SGB Executive

The sporting goods industry showed some resilience in 2019. SFIA’s 2020 Manufacturers’ Sales Reports showed overall U.S. sports and fitness products industry revenues grew 3.9 percent in 2019, accelerating from 2.3 percent growth in 2018. Stand-out categories include athleisure, coolers, water bottles, tents, running footwear and exercise bikes.

Four of the five big department stores—J.C. Penney Co., Macy’s Inc., The TJX Cos. Inc. and Kohl’s Corp.—beat Wall Street’s earnings and revenue estimates during the fourth quarter ended February 1. Only Dillard’s Inc. fell shy of analysts’ projections for the period, which included a shortened Holiday Season due to a later-than-normal Thanksgiving and Black Friday.

UBS reduced its price target on Nike to $123 down from $136 due to the coronavirus. However, the investment firm said Nike still has an “Exceptional Long-Term Story” and maintained its “Buy” rating due to strong fundamentals.

Fox Factory Holding Corp. shares were up in the mid-single digits Wednesday morning after reporting an earnings and revenue beat for the fourth quarter driven by strength across all categories, including the company’s Specialty Sports Group. That segment includes Fox Factory’s bike component brands—Fox, Marzocchi, Easton cycling and RaceFace.

Kohl’s Inc.’s 2019 results missed expectations due to weakness in home and women’s as well as margin pressures. Traffic and new customer acquisition, however, grew in the second half of the year. Moreover, the active category saw momentum throughout the year and the chain plans to build on that in 2020.

The coronavirus, or COVID-19, is wreaking havoc across the global supply chain. SGB Executive’s latest report looks at the outbreak’s economic impact on the active lifestyle marketplace, including how companies, consumers and even trade show operators are reacting.

Velofix has become the largest fleet of mobile bike shops in North America with more than 125 franchise partners in Canada and across the U.S. and plans to accelerate that growth with fresh funding and the introduction of corporate-owned vans. Chris Guillemet, CEO and co-founder, talk to SGB Executive about Velofix’s disruptive business model.

BSN Sports dominated last month’s M&A activity. The Dallas, TX-based team sports apparel and equipment distributor announced a trio of acquisitions in February, bringing the company’s 2020 total to four. Also, the boutique outdoor and active lifestyle public relations firm CGPR found a new home with a larger agency in a deal that provides synergies for both.

Acushnet Holdings Corp. is riding an impressive wave of momentum into 2020. But the Fairhaven, MA-based parent of Titleist and other brands is facing a sizeable hazard midway through the first quarter, one that should be a drag on the top and bottom lines for at least the first half of the year—the coronavirus.

Foot Locker Inc.’s fourth-quarter sales came in below expectations due to ongoing challenges in the apparel category and underperformance by Adidas in footwear. But sales growth is expected to resume in 2020 as demand for Nike and Jordan product remains strong and several newer initiatives – including its Power Centers, FLX rewards program, and dedicated women’s spaces – are showing promise.

Last year, Camping World Holdings Inc. closed or sold more than 60 locations that didn’t sell or service RVs, a move took a toll on 2019 results by causing some short-term revenue and earnings pressure. But as Camping World turns the page on its retail model and refocuses on its core RV business, the company appears better positioned for 2020 and beyond.

Top headlines from across the active lifestyle industry featured in SGB during the week of February 24, 2020.

HSBC Global Research issued a bullish report on the sporting goods space, believing industry growth in the years ahead will be fueled by younger and more health-focused consumers, a global shift towards casualization, and the growing importance of sustainability among consumers.

5.11 Tactical, the apparel and gear brand owned by Compass Diversified Holdings LLC (CODI), truly found its stride in 2019 and Q4, in particular. The brand posted its second consecutive quarter of double-digit revenue growth and fourth consecutive quarter of double-digit EBITDA growth. Here’s how 5.11 did it and what’s in store for 2020 and beyond.

In a further sign that it’s extensive restructuring efforts are paying off, Crocs Inc. reported a profit against a loss in the fourth quarter as sales climbed 21.8 percent. Crocs, however, joined other firms in warning of a near-term hit to revenues due to the coronavirus outbreak.