The general ledger (BC company DPS PROD, division 02) tells the story of MV Sport's trouble in three acts. First the top line fell: net revenue dropped $10M between 2022 and 2024 ($79M → $69M) and stayed there. Then the cost base didn't follow it down: decoration, warehouse and operating expenses — roughly $40M a year of internal cost — barely moved, so every dollar of lost revenue fell almost straight through to the bottom line, and a +$1.1M operating profit in 2022 became a −$5.0M loss by 2025 even though merchandise sourcing was getting cheaper. Then, in 2026, the sourcing tailwind reversed: landed product cost is running points of revenue above 2025 ( above 2024 — LDP, FOB and a new tariff account), gross margin has fallen to , and 2026 as a whole is shaping up to a operating loss — even holding revenue flat at 2025's , a level the A2000 order book ( H1 bookings) comfortably supports. of net losses are already booked since 2022, heading for roughly by year-end.
The whole ledger, top to bottom, side by side (blue bars are GL subtotals; salmon steps are costs; dark red is a loss). Read one year left to right, then compare the years: 2024 — of revenue absorbs all its costs and comes out at the operating line. 2025 — revenue is flat () and so is every cost bar, so the loss barely moves (). 2026 expected — revenue is held at the same as 2025 (the A2000 order book supports it), but at 2026's unit economics the merchandise bar swells to (from — the landed-cost shock) so gross profit falls → , the operating loss deepens to , and net income lands at . The same sales now lose more money — that is the whole problem in one chart. "Interest & other" nets other income against interest and tax.
Net revenue = gross sales less returns & discounts. COGS is split the way the economics work, not the way the account ranges happen to group: merchandise (sold) = product purchases (FOB + LDP landed-duty-paid + freight/duty/tariffs) plus account 60900 "Ending Inventory Change" — the periodic-inventory plug that converts what was bought into what was sold (leaving it in the warehouse bucket, as the raw account ranges do, makes warehouse cost swing ±$14M a year on pure accounting). 2026e = revenue held flat at 2025's level × the unit economics of the posted GL months (construction details in the source note at the bottom); the Δ column compares it against full-year 2025.
Revenue fell from 2022 to 2024, then held flat into 2025 ( → ). The 2026e bar is held flat at 2025's — a deliberately conservative assumption that the A2000 order book (Market segments tab) still comfortably supports: H1 bookings are vs 2025, even though the GL's shipped revenue is pacing only () because orders are converting to shipments slowly (see the demand note below). The revenue problem is real but it is old — demand has stabilized; what keeps getting worse is what the ledger does with each revenue dollar.
Top: every cost line in dollars, indexed to 2022. Revenue (blue, thick) is down ~20%; merchandise cost tracked it down — it's variable — but decoration, warehouse and opex stayed at or above their 2022 dollars. Bottom: the same thing as a common-size P&L. Decoration went from of revenue to , warehouse from to , opex from to — roughly points of revenue consumed by fixed-cost deleverage. Through 2025 this was partly hidden because merchandise sourcing kept getting cheaper ( → of revenue by 2024). In 2026 that mask came off.
The account-level detail names the culprits. These are the largest swings in the operating ledger — GL pacing for 2026 (posted Jan–May ×12/5) against full-year 2025:
"OI impact" = what the swing does to operating income. Reading the top rows together: shipped full-price sales are pacing below 2025 (the headline 2026e revenue above instead holds flat at 2025's level, which the A2000 order book supports — the backlog ships later), yet LDP cost is already pacing above 2025 — paying more for product while shipping less of it. The favorable-looking 60900 swing is the inventory plug — costlier 2026 purchases sitting in inventory rather than COGS — i.e. part of the cost shock hasn't reached the P&L yet. Read the bonus lines (60435, 60615, 70125) with care: bonuses post at year-end, so a straight ×12/5 of Jan–May shows them going to zero — an extrapolation artifact, not a cost cut.
Monthly gross margin through the last fully-posted month (). The 2026 line (red) sits below 2024–25 from January — a step-change in unit economics, not a bad month.
Merchandise (sold) rises from to on the identical of revenue. The division is not buying more goods — it is paying more per garment. In 2025 merchandise consumed ¢ of every revenue dollar; in the posted 2026 months it consumes ¢ — and that ratio move, applied to , is the entire . The ledger shows the mechanics (LDP cost pacing above 2025 while shipped sales pace below it; a brand-new tariff account, 60126). The SKU-level costing book shows exactly where it lands: suppliers' re-quoted landed-duty-paid (LDP) costs add a year at 2025 volumes across the 118 core styles — the same ≈$2M arriving in the GL. The twelve biggest dollar movers:
Per-unit landed-duty-paid cost, 2025 book → re-quoted book, weighted by 2025 unit volume. These twelve SKUs alone add
a year (
% of the total). The pattern is broad, not idiosyncratic: the entire fleece core takes
+14% (139 Fundamental Fleece Hood, 20335 Crew, 3300 Pro-Weave® Blanket, 17116 Vintage Raglan), outerwear up to +18–20%, and even the Classic Tee (555k units) +7%. Domestic-decorated Pro-Weave® styles (488, 496) escape with ~+4%. What portion of this is recoverable through price — SKU by SKU, against live competitor comps — is exactly what the
2027 pricing analysis and
strategic proposal tabs quantify.
On the 2026 expected P&L — of revenue, gross margin, of opex — the arithmetic of getting operating income back to zero looks like this if only one lever moves:
What this means. No single lever reaches zero, and two of the three are barely levers at all — demand is already stable and opex is already flat. The recovery has to come mostly from
gross margin: price and landed cost. That is exactly the surface the
2027 pricing analysis and the
strategic proposal work: selectively passing the LDP increases through recovers roughly $1.9M of operating income; combined with modest volume recovery (the order book is growing) and the fixed-cost leverage working in
reverse on the way up, that is the path the ledger points to.
Booked vs recognized — and why 2026e revenue uses the order book. 2026 A2000 bookings are running
ahead of last year through June (
on Jan–May; Market segments page — order value credited when an order is placed), while
recognized GL revenue is pacing vs 2025 (posted only when invoiced/shipped). Orders are arriving faster than they convert to shipped revenue — a building backlog (see
Department latency), not disappearing demand. This page therefore holds 2026e net revenue
flat at 2025's — a conservative floor the order book more than supports — rather than using shipped pacing (
). Opex tells the same story from the cost side:
(2025) →
(2026e), flat-to-down. The trouble in this ledger is not volume and not spending — it is
what each shipped dollar costs.
The bottom line, from the GL. A business shrank to and kept a -a-year internal cost structure built for the larger version of itself — that converted a profit into a loss by 2025 ( volume, margin rate, only of opex relief). Cheaper sourcing had been absorbing part of that blow; in 2026 sourcing flipped to a headwind (merchandise cost running + pts of revenue above 2025's rate, visible in the LDP, FOB and tariff accounts) and the loss is on pace for . Cumulatively the division has booked of net losses since 2022 — and the fix the arithmetic allows runs through price × landed cost, not through cutting.
Source & scope. Business Central GL, company DPS PROD, List_GeneralLedgerEntries_QRY30300, global dimension 1 = division 02 (MV Sport), posted entries 2022–2026. Amounts are signed (income credited); revenue and margins flip credits to positive. P&L classes: net revenue 50100–50400; COGS 60110–60900 presented as merchandise-sold (product purchases 60110–60300 + inventory change 60900), decoration (60400–60540) and warehouse & ops (60600–60899); opex 70100–80920; interest 90100, tax 95100. 2026 appears throughout as "2026 expected" (2026e), compared against prior full years rather than YTD-to-YTD. Its construction: net revenue is held flat at 2025's actual — deliberately conservative; the A2000 order book (Market segments tab) is running ahead of 2025 on H1 bookings, so flat is a floor the demand data supports, while the GL's posted months understate the year because bookings lead shipments. COGS holds the cost ratios observed in the five posted GL months (Jan–May 2026 unit economics; June revenue had not posted at extract time) — conservative, since fixed decoration/warehouse cost spreading over more volume would do somewhat better. Opex, interest and other income extrapolate ×12/5 (fixed lines); year-end postings (bonuses, inventory true-ups) make individual extrapolated account lines pacing indicators, not forecasts. The account-movers table stays on pure GL pacing (×12/5) so it reads directly from the ledger.