Marimekko, the Finnish textiles-to-fashion company, has released its updated guidance for the full year, stating that net sales are expected to be lower. The comparable operating profit could potentially be similar to last year, but there is also a possibility of it being lower. This revised guidance reflects the ongoing uncertainty that businesses are grappling with as they try to navigate the trading landscape for the rest of 2020.

Earlier in March, Marimekko had to withdraw its initial guidance due to the estimated impact of the coronavirus pandemic. In its interim financial report in August, the company acknowledged that the pandemic would have a significant negative impact on sales and profitability. However, it also noted that the situation was evolving rapidly.

In a statement released on Friday, Marimekko stated that despite the significant uncertainties caused by the pandemic, it now has a better understanding of the impacts on its business. Although sales and profits are anticipated to be lower, this updated outlook represents an improvement compared to the previous forecast. The improved outlook is primarily based on a better-than-expected trend in Finnish retail sales during the summer, an improved wholesale outlook for the remainder of the year, and higher-than-estimated fixed cost savings.

However, it is crucial to acknowledge that there are still significant uncertainties associated with this outlook. The performance of the domestic market and overall retail sales depend on the trend in customer numbers in retail stores for the rest of the year. Additionally, the possibility of new major waves of coronavirus infections in the fall, which may necessitate temporary closures of Marimekko’s own retail stores, could impact the outlook. The recovery of wholesale partners and customers from the crisis can also influence their replenishment orders for the remainder of the year and subsequently affect Marimekko’s full-year outlook. Furthermore, the global crisis may have an impact on the operational reliability of the company’s value chain.

Overall, while Marimekko has issued an improved guidance, uncertainties still persist due to the ongoing effects of the pandemic. The company remains vigilant, closely monitoring the situation, and making necessary adjustments to its strategies in order to navigate these challenging times in the fashion industry.

Useful links:
1. Marimekko Official Website
2. BBC Business Section