U.S. sporting goods manufacturers managed to increase sales and profitability in 2002, despite the stagnant economy, by controlling costs and leveraging assets. That’s the key finding of SGMA International’s 20th Annual Study of Financial Performance – 2003 Edition. This report is based on actual results reported by 61 manufacturers (privately and publicly owned) in the athletic footwear, sports apparel and sport equipment industry segments, having combined sales of $27.2 billion in wholesale value in 2002.
Sporting goods manufacturers sales growth (+6.8%) surpassed the growth of the national economy, as well as that of non-durable goods manufacturers. However, profitability still lags behind that of all U.S. manufacturers.
Following are some key facts abstracted from this report.
- Gross margin (38.6%) improved substantially, indicative of lower material costs, etc.
- Overhead cost cutting practices have helped bring more to the bottom line, as return on sales (5.9%), return on assets (8.2%) and return on investment (13.8%) ratios all improved.
- Companies demonstrated better control over assets as the inventory and accounts receivable ratios, as well as asset turnover ratios, improved in 2002.
- Manufacturers are more highly leveraged, operating under tighter working capital conditions, which could turn negative should sales suddenly expand or margins recede.
- There have been cut backs in advertising and R&D spending.
The 55-page report is comprised of narrative analysis of survey results, stock price, net income and earnings per share (EPS) data for 36 publicly owned sporting goods manufacturers, as well as statistical tables for 31 financial measures from the survey shown in total and grouped by company size, major product sector and type of ownership.
This report is available only as a PDF download or as a Kinko’s Doc Store printed copy. OBTAIN REPORT
