ASKIM, Norway, Oct. 21, 2003 (PRIMEZONE) -- Gresvigs preliminary figures for Q3 show weaker results than expected and weaker than Q3 2003, mainly due to weak results in own stores. Other parts of the group are in line with the company's expectations. A restructuring process will be started immediately to improve the results in own stores.Preliminary accounts show an EBT of NOK 2.2 million in Q3 (NOK 20.5 million) and NOK 35.3 million year to date (NOK 43.9 million). Own stores show a preliminary EBT of NOK -30.0 million (NOK -8.1 million). Gresvigs total EBT for the year is expected to be around NOK 55 to 60 million. Final results for Q3 will be presented on 6th November, as previously announced. The board has announced that an action plan will be implemented immediately, in order to regain profitability in own stores.
The weak results in own stores are mainly a consequence of strong competition in the Oslo area, where most of the own stores are located, but also lack of focus on profitable operation in own stores. Major resources have been tied up with projects related to development of new joint venture agreements with the chain members, and with an extensive process related to new chain concepts. This work has contributed to improved results for the chain members, but has at the same time caused lack of profitability focus in own stores. The process with new, long term, joint venture agreements in the chains is in line with plans. This is expected to generate margin improvements as a result of improved purchase terms. Gresvig has, together with the G-Sport Council, come to an agreement upon the terms in a new joint venture agreement between Gresvig and the G-Sport chain members. Agreements are ready to be signed with each member, starting in November 2003. The same process is being executed together with INTERSPORT chain members in Norway.
Gresvig's board and administration have started a restructuring process in own stores, in order to reduce operating costs, increase sales and increase margins. Cost reductions will be achieved by reducing the number of employees and by reducing other operating costs. Work force reductions have already been executed in the stores, and management changes have taken place. There will also be a programme to increase focus on sales campaigns, marketing and advertising issues, and on general sales issues in own stores
An over all restructuring process for own stores is also planned, with special focus on size, location, incentive models and ownership models.