SGB Executive

The Week’s Top Headlines across the Active Lifestyle Industry as reported in SGB Updates during the week of March 16, 2020.

The coronavirus has taken a huge toll on Vail Resorts Inc., which closed its 34 North American resorts (with the chance of reopening three of them). Vail remains in a strong financial position, but such an abrupt end to the ski season quickly turned the company’s fiscal 2020 into a “year to forget.”

Duluth Holdings Inc., the parent of Duluth Trading, plans to reduce new store openings and take other measures that will curtail expenses and capital spending in 2020 to weather the expected fallout from the coronavirus outbreak. Said Stephen Schlecht, executive chairman and CEO, “Our plans for fiscal 2020 made just a few weeks ago are already out of date and under review.”

Online sales could get a significant bump as Americans head indoors and avoid stores to help stop the spread of coronavirus but supply chain issues, out-of-stocks and eroding consumer confidence may hold back some gains.

A burgeoning ski category includes three relative newcomers—Dahu Boots, Envy Snow Sports and Mad Jack Snowsports—plus a longtime player, all of whom aim to remove foot pain by making more comfortable boot systems. SGB Executive breaks down their efforts to bring more people to the sport and keep them on the slopes for longer.

The NPD Group believes the postponement of most of the major sports leagues’ seasons due to the coronavirus outbreak will have a minimal impact on athletic footwear sales but may cause some near-term pain for the licensed sports category.

The chaos that coronavirus is causing across the active lifestyle marketplace is unprecedented. And while it’s hard to claim any “winners” when an outbreak such as Covid-19 is wreaking so much havoc on everyday life, a couple of categories in this space stand to benefit—firearms and at-home fitness manufacturers.

Designer Brands Inc. announced an extensive cost-savings plan to offset the expected fallout from the coronavirus outbreak. The parent of DSW also announced it is temporarily closing its stores while reporting fourth-quarter results showed some sequential improvement.

Tilly’s Inc., as previously reported, saw its first negative quarterly comp in over three and a half years. With a new chief merchant in place, the action sports-themed chain on its fourth-quarter conference call laid out its revised merchandise priorities for 2020.

Zumiez Inc.’s fourth-quarter earnings came in better than expected and momentum continued into February with particular strength in skateboards. Sales are generally holding up well in its home state of Washington despite the coronavirus although officials aren’t sure to what extent social distancing will hurt sales.

Sequential Brands Group Inc. began 2020 with a key leadership change, and the New York, NY-based parent of Avia, And1 and Gaiam is eyeing further transformational moves this year with a strategic review that could include acquisitions, divestitures and more.

SGB Executive’s update on the latest closures, cancellations and postponements due to the ongoing coronavirus outbreak.

The coronavirus fallout on supply chains and increasingly consumer spending was addressed extensively on quarterly conference calls last week. Many expressed vast uncertainty on what disruptions the coronavirus may have on retail. Dick’s CEO Ed Stack said, “We have no idea. I don’t think we’ve seen anything like this in a very, very long time.”

The coronavirus has hit mountain towns especially hard, and Saturday afternoon was an inflection point for the ski industry. When Vail Resorts Inc. announced it was suspending operations at its North American ski areas, most others followed suit.

Caleres Inc., the parent of Famous Footwear, reported fourth-quarter earnings came in below internal plans due to weakness in fashion footwear and slower growth in sport-inspired product.