Swiss lingerie and pyjama maker Calida says its net profit more than doubled last year to SFr5.3 million ($4.57 million) as it continued its turnaround.
Announcing its results on Friday, the Swiss market leader said it would continue its relocation of production jobs to eastern Europe.
The SFr6 million operating profit in 2004 was twice the previous year’s level, despite sales dropping to SFr138 million. The company had earlier said it expected sales to remain at the 2003 level of SFr141.8 million.
Calida blamed difficult markets for lower sales, in particular weak consumer spending in Germany – the firm’s second biggest market. It said it expected sales to increase in the current year.
The firm said that thanks to the good results, it was proposing to pay a dividend of SFr5 per share for the first time since 2001.
"We are proud that we have managed to continue the positive momentum from last year’s turnaround, and secure a further improvement in the business result," said Calida CEO Felix Sulzberger in a statement.
"I am confident that we will be able to generate sustainable profits."
Local production ends
Calida said that over the next two years it would complete the process of shifting production from Switzerland to cheaper countries. At the same time sewing capacities would be gradually moved from Portugal to eastern Europe and Asia.
Thirty jobs at Calida headquarters in Lucerne will be affected. These positions will be relocated to Hungary and to external suppliers.
Calida embarked on a company restructuring programme in 2001, shifting production abroad and stepping up its marketing. The first fruits of these efforts were seen in 2003, when the company moved back into the black.
Calida is the market leader for nightwear and lingerie in Switzerland, with a share of more than 20 per cent. Its second biggest market is Germany where it has a share of three per cent.
The company has started modernising its image in recent years in a bid to establish itself as a major European brand.
swissinfo with agencies
Calida reported net profit of SFr5.3 million ($4.57 million) in 2004.
Operating profit (EBIT) more than doubled to SFr6 million on sales which fell to SFr138 million.
The company is to end production in Switzerland over the next two years.
Thirty jobs will be lost at the company's headquarters in Sursee, Lucerne.
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