Asics reported its sales in Japan decreased 1.5 percent to ¥27.2 billion ($267 mm), mainly because of a decline in footwear sales to overseas sales subsidiaries. Income at its Japan segment declined $6.1 million, or 60.5 percent, to ¥387 million ($3.8 mm), primarily due to an increase in advertising and selling, general and administrative expenses attributed to openings of directly managed stores.
On a consolidated basis, Asics’ net sales were ¥161.6 billion ($1.58 bn) in the fiscal first quarter. Overseas sales were ¥138.7 billion ($1.35 bn), or 86.8 percent of revenue. Consolidated gross profit was ¥73.2 billion ($717 mm), or 45.3 percent of net sales. Operating income was ¥20.1 billion ($197 mm), or 12.4 percent of net sales and net income was ¥14.4 billion ($141 mm), or 8.9 percent of net sales.
Asics did not provide year ago figures for its operations outside of Japan because it is shifting toward a unified fiscal year that will start Jan. 1, 2015. The change aims to enhance transparency of its budgeting, performance management and financial reporting as its global expansion accelerates. To accomplish this, Asics is abbreviating its Fiscal 2014 year to the nine months ending Dec. 31, 2014. During this transition period, January through March results from Asics’ overseas segments are being attributed to fiscal first quarter results, making year-to-year comparisons difficult.
In the fiscal first quarter sales and operating income for those segments was as follows: Americas, ¥57.5 billion ($563 mm) and ¥6.4 billion $62.2 mm); Europe, ¥52.4 billion ($513 mm) and ¥5.2 billion ($51.2 mm); Oceania /South East and South Asia, ¥8.3 billion ($86 mm)and ¥1.7 billion ($16 mm); East Asia, ¥15.2 billion ($149 mm) and ¥1.5 billion ($149 mm). At its Other Business segment, sales reached ¥4,942 million and operating loss was of ¥632 million. The segment began operating, maintaining and managing public sporting facilities at nine locations in Kobe City during the quarter.
On a category basis, Asics said the release of the company’s Gel-Nimbus 16 and Gel-Cumulus 16 drove sales in its Running business, while the launch of replica jerseys of both the South African and Australian national rugby teams boosted Apparel sales. Directto-consumer sales increased thanks to the opening of 16 new stores and the greater promotion of Running products on its global e-commerce platform.
Asics centralized apparel sourcing for each of its country’s in Hong Kong during the quarter in a move executives said will enable it to expand global sales and profitability.
