Odd Molly International AB (publ)
Stockholm, Sweden, September 30, 2019
Odd Molly has today signed an agreement to license the well-established Swedish trademark Hunkydory as part of a strategy to further strengthen its position as an international brand. Extensive changes are underway within Odd Molly, and the company is of the opinion that Hunkydory can be integrated into the business and managed effectively, resulting in economies of scale and synergies. The trademark is being licensed through 2023 with an option to then purchase it from the Finnish financial company Bruk Financial Services Oy (Bruk), which currently owns the trademark.
Odd Molly has in the last year concentrated on its core business – to create clothing collections with strong personality distributed mainly through its own online sales and strong retailers in its home markets in the Nordic region as well as through international partnerships. The goal of Odd Molly’s restructuring is to become more distinctive, faster and more efficient, and to increasingly focus on digital sales. The company today has a strong management team and product development department, well-established suppliers and a distribution structure and competence through its own channels and through partners. The next, natural step in the strategy is to create economies of scale through higher volumes, and Odd Molly assesses that it can efficiently manage Hunkydory while benefiting from synergies.
“Hunkydory has over the years been a colleague in the industry that we have had great respect for. The brand has a distinctive style and position in the market. They have succeeded in building strong demand, but, as I see it, have not succeeded in adapting quickly enough when consumer behavior changes. We still see great potential in the brand and believe that we, by utilizing Odd Molly’s established platform, can create synergies and additional value. When we have freed up capacity in various areas through our extensive restructuring, we feel that a relaunch of Hunkydory will be feasible without adding any significant costs, thereby giving the company a great opportunity to capitalize on the strong structure we have put in place,” says Jennie Högstedt Björk, CEO of Odd Molly.
Hunkydory: An established brand
Hunkydory was established in 1996 and profitably grew for many years. In 2010-2016 average sales exceeded SEK 100 million per year. In 2010 it launched its own e-commerce business and in 2012 the company won Sweden’s Guldknappen fashion award. By 2015 sales had surpassed SEK 120 million. At the same time the company lost a number of customers, which, coupled with a turbulent market and unfavorable exchange rates, forced its retail operations into bankruptcy in 2017, followed by the entire company at the end of 2018. Since then the Hunkydory trademark has been owned by the Finnish financial company Bruk Financial Services Oy.
Licensing agreement with an option to purchase
Odd Molly will as of October 2, 2019 and through December 31, 2023 license the Hunkydory trademark from Bruk and pay a licensing fee based on the brand’s sales. The right applies to distribution in all channels. In the fourth quarter of 2023 Odd Molly has the right to acquire the trademark for consideration based on the brand’s sales at the time.
Odd Molly is preparing to relaunch Hunkydory for the fall/winter 2020 collection with sales starting in the second half of 2020 through the web shop and selected retailers and partners. The agreement is not expected to have a material effect on the Group’s earnings or financial position in the current financial year.
For further information, please contact:
Jennie Högstedt Björk, CEO, +46-8-522 28 509
Johanna Palm, CFO and Deputy CEO, +46-760-10 24 55
This information is information that Odd Molly International AB is obliged to make public pursuant to the EU’s Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set above, on September 30, 2019 at 2.30 pm CET.
This is a translation of the original Swedish language report. In the event of discrepancies, the original Swedish wording shall prevail.