Good afternoon, ladies and gentlemen. My name is Anna Torminen. I'm the IRO of Marimekko. I have the pleasure to invite soon here Tina Allahutakasco, our President and CEO, to present our Q1 results for this year. After Tina's presentation, we'll have time for Q and A and you can type in your questions using the chat function already during the presentation.
But now without further ado, Tina, please go ahead.
Thank you, Anna, And good afternoon, everyone. It is my pleasure today to open up the Q1 results of our 17th anniversary year of 2021. And let's get started. I have to say, I'm personally extremely proud of our Marimekko team That in the Q1 of our 17th anniversary year, we together succeeded to make a significant result improvement in the yet still challenging situation. As we know, the coronavirus pandemic still continues to heavily impact the fashion industry.
But even still, at Marimekko, we were able to grow our net sales by 17%, driven by international sales that increased by 29%. Especially the wholesale sales performed well, but also licensing income showed clear growth. Overall, we can see that What supported us with this strong result in the Q1 was the attractive collections paired with the growing interest overall in home During the course of the pandemic, overall, the lessons learned new ways of working that we've accumulated in the Marimekko team During the past one and a half years in these exceptional circumstances as well as the long term work that we have done to develop our brand and omnichannel business, These are all factors that helped us achieve this good strong growth. And we're Also very happy to announce that our comparable operating profit improved significantly. It grew from 1,200,000 In the comparison period to €5,600,000 and a decrease due to the sales growth As well as relative sales margin strengthening and fixed costs being lower than in the comparison period.
What is good to remark though here is that the decrease in fixed cost was partly due to the timing of expenses and some temporary cost savings. Overall, in 2021, in our anniversary year, we will be investing in strengthening the building blocks of our long term international growth. During the course of the past one and a half years, our belief and trust to our international growth strategy has even further strengthened. And our plan is to really be courageous and tap into these growth opportunities that uniquely Present for Marimekko. As the consumer behavior is changing due to the expedited digitalization and increasing importance Of course, at the same time, the pandemic situation, as it continues, we keep monitoring the situation very carefully And I definitely then adjust plans if needed.
Then if we have a closer look into our Net sales development. So as mentioned, a good 17% total net sales growth And which were especially boosted by a favorable trend in the wholesale sales in the Asia Pacific region, Finland and Scandinavia as well as the increased licensing income in EMEA, which is due to a newly signed agreement this spring. Something to be noted is that the sales growth in the Asia Pacific was partly due to the transfer of some of the wholesale deliveries from the final quarter of 2020 moving to the Q1 of the current year. Nearly all of the Marimekko Stores have been opened in the Q1, but overall, the footfall in the store has been noticeably lower than in the previous year due to the pandemic. However, as in the past year, Marimekko's online sales continued to grow well, which then helped compensate The negative impacts of the reduced footfall in the physical stores.
Overall, the retail sales Fell quite moderately in these special circumstances, meaning only by 4%. Then when we look at the net sales split per market area as well as product line, What we can see is that as the net sales growth was very much driven by international sales growth, We can see that the share of the Finnish market dropped to 50%, while then we could see nice increases, especially in the Asia Pacific region And also in EMEA, in EMEA, of course, this markedly higher licensing income than in the previous year Supported this increase in the relative share of the market area. Then when we look at the net sales By product line, here we can really see the strength of Marimekko's lifestyle concept featuring 3 product lines, namely, of course, fashion bags and accessories and home. So as during the course of the pandemic, people around the world have been spending more and more times in their homes. We've seen overall in the market a tremendous trend in increasing interest to home decoration.
And that has also translated very well for Marimekko. We have had a very strong home offering for well, ever since the company has started. And our home products grew by 37%. However, we did see growth across our product lines, which is, of course, a wonderful result in these exceptional times. Then when we look at our retail footprint, Of course, omni channel Marimekko retail is the key driver of our growth.
Today, the Asia Pacific region already has the greatest number of stores, and The Marimekko online store already serves customers in 34 countries. And I can't highlight enough the importers Of creating a seamless omnichannel experience, and that's the way that we approach our business as well. The Marimekko brand sales amounted to €67,400,000 and already 69% of our brand sales Come outside of the whole market. What is then brand sales? It represents the reach Of the Marimekko brand through different distribution channels.
So it's an unofficial estimate of sales of the Marimekko products at consumer prices, And they are calculated by adding together Marimekko's own retail net sales and the estimated retail value of Marimekko sold by Other retailers. In the Q1, as mentioned, our results improved significantly and amounted to 5.6 €1,000,000 In addition to the increased net sales, also the improved relative sales margin as well as the decrease In fixed costs, partly due to the timing of expenses and temporary cost savings, contributed to this great positive development. And if we look at more into detail to some of these drivers behind the aforementioned factors, The improved relative sales margin improved due to the improved Product margins as well as the significantly higher licensing income than in the previous period. Then we would look at the fixed SKOS, what were the key contributors there? So we have lower credit loss provisions.
And then there are some of these timing related aspects, Such as the timing of the marketing investments as well as some temporary aspects such as the temporary rent reductions And some rents being linked to net sales, which, of course, helps flex in these exceptional circumstances where the footfall Food traffic to the stores is much lower than usual. Then just highlighting some exciting events in the Q1 kicking off the 70th anniversary year. Copenhagen Fashion Week is today one of the world's most significant global fashion events, and it is Extremely important and relevant for Marimekko because of its high sustainability agenda and positioning. And therefore, This spring, we decided, instead of presenting our newest collections, to tell the story of Marimekko to the fashion industry By highlighting our timeless design philosophy, sustainability thinking as well as our original approach to printmaking. And at the in conjunction of the Copenhagen Fashion Week, also the Zalando Sustainability Award competition was organized.
And What is great news is that Marimekko was awarded the 2nd place in to recognize our long term work to promote sustainability. Also in the Q1, we were able to continue to increase our visibility in the Asian markets. And Obviously, Asia really represents an important market area for us for our next phase of our international growth. So what we did, we had in several major Asian cities, Marimekko pop up stores that showcase either our anniversary collections or our co created special collections, limited edition collections. In addition, the world's 1st Marimekko Kiyoski Streetwear store was opened in Japan with great success.
Overall at Marimekko, we very much believe that the role of creative retail concepts such as these kind of pop ups, creative pop ups That really take the attention in an eye catching way and tell the story of our brand in a surprising yet Natural Way represent an important part of the seamless omnichannel customer experience. And we believe that the role of these kinds of creative retail concepts will even further increase in the post pandemic new reality. Then a few words about the overall outlook for 2021. So as mentioned Earlier on in the presentation, the coronavirus pandemic has created the worst crisis experienced by the global fashion industry And specialty retail sectors indicates and it will still continue to heavily impact the sector in 2021. It is also changing consumers and expediting consumers' purchasing behavior, and it can have an impact on our sales profitability and cash Flow as well as can impact the reliability of our company's value chain.
However, as mentioned earlier, we are closely monitoring the development of Pandemic across our markets, and we will adjust our operations and plans if needed, depending on the situation. Then having a closer look into our 2 major key market areas, so of course, Finland and Asia Pacific. So Finland traditionally represents about half of the company's net sales. And also in 2021, we're expecting Our sales in Finland had to grow on the previous year. Also something to be noted is that the domestic wholesale sales in the current year will be boosted by these Nonrecurring promotional deliveries, the total value of which is estimated to be substantially higher than in the year before and With a vast majority of these deliveries taking place in the latter part of the latter half of the year.
Then if we look into Asia Pacific, which is obviously our 2nd largest market area with a very significant Role in our company's overall international growth strategy. We also do expect our net sales in the Asia Pacific region To increase in 2021 and as the company's aim is to open 5 to 10 new Marimekko stores and shop in shops in 2021, Most of these planned openings will be, namely in Asia. Then to continue, Overall, both our company's own and our Asian partners, omni channel Marimekko Retail, represents the key driver of Marimekko's growth. And In 2021, also the nonrecurring promotional wholesale deliveries in Finland are estimated to have a significant impact on our growth. These nonrecurring promotional deliveries may also increase our inventory risks.
The overall development of the coronavirus situation, the vaccine In coverage and the possible tightening restrictions in the different market areas, on the other hand, do influence the customer numbers in stores and this way also the outlook for both Telen wholesale, including the nonrecurring wholesale promotions. What's also good to remember is that the rapid fluctuations in demand Due to the pandemic, it can have an impact, for example, on the availability of products and consequently on the net sales. This year, we will be also continuing our actions to control the cases of gray exports, which will have a clear weakening impact on the company's net Sales and earnings and also licensing income is forecast to be lower than in the previous year. As discussed earlier on, our And is to accelerate our long term international growth in 2021. And this way also the fixed costs are expected to be up on the previous year.
What's also good to keep in mind is that in 2020, the fixed costs were reduced partly by temporary cost savings As well as the subsidies granted in different countries to mitigate the negative impacts of the coronavirus pandemic on the business. Our marketing expenses are expected to grow to the previous year, while the total investments are estimated to be around the same level as the year 4, and most of these investments will naturally be devoted to IT systems in order to strengthen our company's digital business. And finally, because of the seasonal nature of our business, the major portion of our company's euro denominated net sales Earnings are generated during the last two quarters of the year. And then last but not least, last This week, we raised our earnings guidance for 2021, while keeping the net sales estimate remaining or keeping the net sales estimate unchanged. The upgrade in the earnings was due to, in particular, to the improved sales outlook for the full year, supported by the very strong first Order of the year.
And thus, the financial guidance of Marimekko for 2021 is that we expect that our net sales Our we expect that our net sales are to be higher than in the previous year and the comparable operating profit margin is estimated to be approximately on par with or higher than in the previous year. Still, it's good to keep in mind that the instability caused by the COVID pandemic It continues in the Marimekko markets and thus there are significant uncertainties associated with the trend in net sales and earnings overall. But with these words, I would like to thank for listening to Marimekko's Q1 interim results And now opening up for questions.
Thank you, Tina. There are a few questions related to our net sales. The first one is About the increased licensing income in EMEA region. Could you tell more about this?
Yes. So Some of you who may remember or have been following us for a longer time, it's typical for Marimekko sometimes to have Licensing income in some quarter and in others, we might not then have them. So it's these vary This licensing income may vary across quarters. When it comes to the licensing income in the EMEA region In the Q1, it's related to a new licensing agreement signed in the first During the Q1 and unfortunately, at this point in time, I'm not able to share more about this. But as soon as it's possible, we will be then sharing more.
Thank you. The second question is related to net sales and marketing. Have you been able to improve your efficiency in marketing Since you were able to reach 17% increase in net sales with lower marketing investments. And if so, Will this open up sort of faster growth potential in future as well?
So when it comes to the Q1 marketing costs, The fact that they were lower is related to just timing. And as mentioned early on, due to the seasonality of our business, The majority I mean, the major part of the business is typically generated in the last half of the year. And this is and typically then also it's natural that there are these sort of timing differences in the marketing Investment pacing during the course of this year. Of course, we continuously develop the efficiency of our marketing efforts. But because we this year especially will be further fueling our long term international growth, we will be investing Also in increasing our international brand awareness, and we will have our marketing costs and investments increase to the previous year levels.
And We think it's exactly what is needed at this point in time in our strategy.
Thank you. The second question is about CapEx. In the last report in the financial statements bulletin, the estimate was that the CapEx would be growing this year. And now in the market outlook, the level is estimated to be similar to 2020. What has changed during these few months?
Thank you also for that question. I wouldn't say that it's anything major that has changed. This year, we will be investing In our CapEx, especially to IT systems, in order to support and strengthen further our digital business. And as Anna, you said, we currently estimate that the level of CapEx is in the previous year's levels.
You mentioned the pop ups in Asia. Are you planning to have more of those this year?
Yes. And I'm very excited to share that. As mentioned in my presentation, we do believe that the role of these sort of pop ups as sort of creative retail experiences We'll further grow in the post pandemic new reality. And actually, after the period under review, Actually, even more Marimekko pop up concepts have been opening around the world. For example, in mid May in the U.
S. Or North America, 9 Marimekko pop ins have been opened at Nordstrom in North America. The Experience is also available online and we've had further Marimekko pop ups also opening in major cities in Asia. So we do believe That these sort of creative retail experiences in the form of pop ups will further increase, and we see a tremendous opportunity to Share our story and to also new customer groups through these concepts around the world.
Thank you, Tina. There are no further questions. So I think we are ready to end our Q and A session. Would you like to say something about tomorrow still?
Yes, Anna. I would like to. So some of you might know that actually today marks the day When 70 years ago, literally, our founder, Armin Ratia, hosted the first ever Marimekko fashion show In Helsinki, which then led to the establishment of our company. So tomorrow, we will be celebrating the 17th anniversary together with our Entire global Marimekko friend community. And as due to the pandemic circumstances, we're not going to be able to celebrate face to face.
We are actually going to be hosting the world's most inclusive fashion party called the Marimekko Summer Market. And everybody can so everybody is invited, so everybody can join at www.marimekko. Party. And this party will take start at 12 at noon in Finnish time. It will last for 12 hours.
It will include exciting virtual Activities as well as performances from all around the world by up and coming artists. So please, everyone, very warmly welcome to join.
Thank you so
much. Thank you.