Assignment 4: AMDP Investment Proposal Memo

To: Clark Hansen, CEO, Anima Mundi Development Partners

From: Genaro Flores-Machorro, Research and Development Analyst

Date: March 4, 2025

Subject: Recommendation to Invest in Helly Hansen

______________________________________________________________________________

As a Research and Development Analyst at Anima Mundi Development Partners, I strive to find

companies that are not only profitable and financially strong, but also ones that fit the AMDP

Standard. After conducting extensive market analysis, I recommend investing in Helly Hansen.

Overview of AMDP Standards

● Triple Bottom Line

The Triple Bottom Line, also known as the Three Ps: People, Planet, and Profit, refers to

a business methodology where a company is evaluated on three components: how

socially responsible it is to its employees and other people, how environmentally

responsible it has been to the plant, and how fiscally responsible it has been in

maximizing the company’s profits (Investopedia).

● Corporate Social Responsibility

Corporate Social Responsibility refers to a business’ commitment to help society and the

communities around them through environmental, philanthropic, and ethical means and

responsibilities, not just attending to and focusing on the traditional singular goal of

maximizing profits (Stobierski).

● Social Enterprise:

Social Enterprise refers to a business whose main focus is not to maximize profits, but

rather to actively help their community through a market-driven approach where the

profits are reinvested into the business to further fund the social cause (Investopedia).

● Carbon Footprint:

Carbon Footprint refers to a measurement used to calculate the total amount of

greenhouse gases emitted into the atmosphere by the company, whether intended or not,

through their production process, transportation, and/ or consumption (EPA).

Company Overview

Helly Hansen (HH) is a premier outdoor clothing and merchandise retailer and manufacturer

founded in 1877 in Norway. Over the past 148 years, it has made a name for itself as the trusted,

quintessential clothing wear for hiking, skiing, and sailing gear, partnering with established

institutions, such as the US Ski and Snowboard Association, Canada’s Alpine and Para-alpine

skiing teams, and the distinguished sailing Ocean Race. It boasts its own trademarked

Helly-Tech systems, created by HH, to ensure breathable and waterproof gear. Gear Lab, a

reputable initiative that tests outdoor apparel and gear, consistently ranks high HH for its overall

low weight, good mobility, breathability, and strong water resistance (Lovell). From Germany to

Mexico, HH attracts an affluent consumer base of all ages, attracting Millennials and Gen X with

36% and 39% (Statista) of them falling in the high income categories. Its popularity rating within

those markets is 29% and 32% (Statista), with an increasing trend. In February 2025, HH was

acquired by Kontoor Brands, an established global lifestyle apparel company.

Commitment to People, Society, and the Environment

In their annual Due Diligence report, Helly Hansen discloses pressing issues that the company is

facing in regards to their employees, society, and the environment. They then identify areas of

growth and give concrete examples of solutions that they are enacting or planning to enact to

their supply chain in order to curtail these issues. Some examples of such solutions provided in

the Due Diligence for Responsible Business Conduct with Regards to People, Animals, Society

and the Environment 2023 Report are:

● Commitment to End Forced Labor

Through social audits of their manufacturing plants and by implementing software such

as TrusTrace to track the raw goods to the finished product (Doyle), HH is monitoring

every step of the supply chain process in order to ensure there are no signs of forced

labor.

● Commitment to Prevent Spillage/ Increased Usage of Hazardous Chemicals

Helly Hansen is actively testing new materials and investing into research to find the

combination that yields a product using materials that least harms the environment. They

have moved away from using PFAS, also known as the “Forever Chemicals,” and have been 

commended by the Washington State Department of Health, citing HH’s alternative

weaves as a safe alternative for apparel and gear (Davis).

● Commitment to Mitigate Climate Impact

Helly Hansen is participating in three decarbonization projects, along with several of

their supply chain partners. Through a circular economy plan that is being created, they

are looking to see how facilitating clothing repairs, re-use, and take back programs can

further help limit the climate impact.

Key Financial Data

As of December 2023, Helly Hansen has been performing well, with its Profit Margins being

8.23% (Orbis), which is the average of retail stores/ online sellers (Investopedia). Their Balance

Sheet is really strong, a sign of financial stability. Their Current Ratio is a healthy 2.10 (Orbis),

meaning their Current Assets are capable of covering their Current Liabilities. More importantly,

their Solvency Ratio is a strong 39.28% (Orbis), indicating a strong, healthy, asset base that is

well able to cover their long term liabilities. In other words, while their profit margins may be

average, their strong asset base is setting them up for success. With the right management and

strategic decisions, Helly Hansen can further expand globally and move to the next level.

Acquired by Kontoor Brands

Kontoor Brands has a vast portfolio containing other well known clothing companies, such as

Wrangler and Lee and has an established global presence. In a press release to their investors and

shareholders, Kontoor Brands has committed themselves “to double Helly Hansen operating

margin and drive significant cash flow contribution over time through improved profitability and

net working capital management” (Kontoor). Kontoor Brands is attempting to take Helly Hansen

to the next level by using its strong asset base to further strengthen their sales and product,

ultimately leading to an increase in the profit margin and shareholder dividends.

Why Invest In Helly Hansen?

Helly Hansen is a socially responsible company that perfectly embodies the AMDP Standards

through its demonstrated commitment to the safety of its workers, the environment, and product

research and development. It is currently in a strong financial position, and with its acquisition

by Kontoor Brands, it will be propelled to a higher profitability bracket. It is my strong

recommendation to invest in Helly Hansen.

Works Cited

“Brand KPIs for outdoor fashion: Helly Hansen in Germany.” Statista, Oct. 2024,

https://www.statista.com/study/176895/brand-kpis-for-outdoor-fashion-helly-hansen-in-g

ermany/

“Brand KPIs for outdoor fashion: Helly Hansen in Mexico.” Statista, Oct. 2024,

https://www.statista.com/study/176948/brand-kpis-for-outdoor-fashion-helly-hansen-in-m

exico/

“Climate Change Terms.” EP A, Environmental Protection Agency, 9 Sept. 2013,

sor.epa.gov/sor_internet/registry/termreg/searchandretrieve/glossariesandkeywordlists/sea

rch.do?details=&vocabName=Glossary+Climate+Change+Terms&filterTerm=carbon+fo

otprint&checkedAcronym=false&checkedTerm=false&hasDefinitions=false&filterMatch

Criteria=Contains.

Davis, Holly. ALTERNATIVES TO PFAS UNDER SAFER PRODUCTS FOR WASHINGTON,

2024. https://www.epa.gov/system/files/documents/2024-03/holly-davies.pdf

Doyle, Megan. “What Are the Fashion Supply Chain Tiers & Their Risks.” What Are the

Fashion Supply Chain Tiers & Their Risks, 2 Sept. 2022,

trustrace.com/knowledge-hub/unpicking-fashions-supply-chain-tiers-their-risks.

Due Diligence for Responsible Business Conduct with Regards to People, Animals, Society and

the Environment, Helly Hansen, 31 Dec. 2023,

www.hellyhansen.com/content/dam/sustainability/Helly-Hansen-2022-Annual-Due-Dilig

ence-Report.pdf.

Kenton, Will. “Triple Bottom Line.” Investopedia, Investopedia, 11 May 2025,

www.investopedia.com/terms/t/triple-bottom-line.asp.

“Key Financials and Employees.” Orbis, Moody’s Analytics, Inc, 14 May 2025,

orbis-r1-bvdinfo-com.libproxy2.usc.edu/version-20250325-4-0/Orbis/1/Companies/repor

t/Index?backLabel=Back+to+Contents&format=_standard&BookSection=KEYFINANC

IALS&seq=0&sl=1747241286830.

“Kontoor Brands Announces Definitive Agreement to Acquire Iconic Global Outdoor and

Workwear Brand Helly Hansen®.” Kontoor Brands, Inc., 19 Feb. 2025,

www.kontoorbrands.com/investors/news-events/press-releases/detail/193/kontoor-brands

-announces-definitive-agreement-to-acquire#:~:text=Under%20the%20terms%20of%20t

he,value%20for%20all%20our%20stakeholders.

Lovell, Zach. “Helly Hansen Loke Review.” GearLab, 5 Mar. 2025,

www.outdoorgearlab.com/reviews/clothing-mens/rain-jacket-men/helly-hansen-loke.

Ross, Sean. “What Is a Good Profit Margin for Retailers?” Investopedia, Investopedia, 12 Apr.

2024,www.investopedia.com/ask/answers/071615/what-profit-margin-usual-company-retail-se

ctor.asp

Stobierski, Tim. “What Is Corporate Social Responsibility? 4 Types.” Business Insights, Harvard

Business School Online, 8 Apr. 2021,

online.hbs.edu/blog/post/types-of-corporate-social-responsibility.

The Investopedia Team. “Social Enterprise: What It Is, How It Works, and Examples.”

Investopedia, Investopedia, 16 July 2024,

www.investopedia.com/terms/s/social-enterprise.asp.