Alpargatas, the parent company of Havaianas and Osklen, saw first quarter sales rise by 32.7 percent to 901.3 million Brazilian reais (€137.9m-$165.5m), posting its best first quarter in a decade as growth accelerated both domestically and abroad following the continued easing of Covid-19 lockdown measures.

Gross margin in the first quarter expanded by 3.0 percentage points to 52.5 percent, with the margin on its international business widening by 9.5 percentage points to 68.2 percent, driven by an improvement in the country mix and by revenue growth management initiatives in the EMEA region. In Brazil, the gross margin instead narrowed by 1.8 percentage points to 43.8 percent, negatively impacted by foreign exchange rate impacts and raw material costs.

Ebitda improved to a positive R$175.3 million (€26.8m-$32.2m) from a negative R$1.3 million the year earlier and net income from continuing operations jumped by 73.5 percent to R$135 million (€20.7m-$24.8m).

Sales of Havaianas increased by 37 percent to R$846 million (€129.4m-$155.4m), with international sales representing 38 percent of the total. Osklen sales inched up by just 0.2 percent to R$51 million (€7.8m-$9.4m).

Alpargatas’ sales in Brazil rose by 21.1 percent to R$583.4 million (€89.2m-$107.2m), led by 25.3 percent growth at Havaianas. International sales of the Havaianas brand jumped by a reported 61.1 percent to R$317.9 million (€48.6m-$58.4m) and were up by 26.5 percent in constant currencies. In Europe, constant currency sales of Havaianas increased by 25.5 percent to R$195 million (€29.8m-$35.8m) while they grew by 12.6 percent to R$45 million (€6.9m-$8.3m) in the U.S. and surged by 736.1 percent to R$5 million (€764,060-$918,062) in China.

Alpargatas’ onlines sales rose by 2.1 times, to R$101 million (€15.4m-$18.5m), accounting for about 13 percent of the Havaianas brand’s first quarter sales and 40 percent of Osklen’s. Havaianas sales through online channels increased by 116 percent, reflecting a two percent rise in Brazil and a 128 percent jump in foreign markets as the brand started its international rollout in the quarter. Online sales at Osklen’s were up by 102 percent.

Alpargatas counted 757 stores in the first quarter, compared to 758 the year earlier. It increased franchises to 673 from 633 while decreasing directly-operated stores to 84 from 125.

As it seeks to speed up its digital transformation, Alpargatas on May 5 announced the acquisition of Brazilian digital solutions firm Ioasys for up to R$200.0 million (€30.6m-$36.7m) in cash and shares to be paid out over five years. Alongside accelerating online sales, Alpargartas aims to expand the Havaianas brand in Europe, North America and China.