FGL Sports, the parent of Sport Chek in Canada, experienced another soft quarter as third-quarter sales grew 0.5 percent and same-store sales inched up 0.4 percent. But Canadian Tire, its parent, is still upbeat about the prospects for the chain.

“There are aspects of the business we are pleased with and others that require attention,” said Stephen Wetmore, CEO and president of Canadian Tire, the owner of FGL Sports, of the business on his company’s third quarter conference call. “However, everything we look at is providing upside potential.”

In early August, Canadian Tire said FGL Sports would miss its ambitious growth goals for 2017 of high-single-digit growth due to weak sales trends. FGL Sports’ retail sales increased 3.7 percent in the second quarter, recovering from a 2.7 percent decline seen in the first quarter but far short of the annual growth goal.

Earlier in the year, Wetmore warned that growth for FGL Sports would slow. At the time, he noted that FGL Sports had completed its five-year plan calling for a 2 million square feet real estate expansion that was started soon after Canadian Tire acquired Forzani Group in 2011. Growth was expected to slow to some degree as the focus shifted more to driving profitability.

On its third-quarter conference call, Duncan Fulton, president, FGL Sports, also noted that the latest third quarter was also impacted by tough comparisons with enthusiasm around the MLB playoffs between the relatively nearby Chicago Cubs and Detroit Tigers. The Olympics also took place last year against no major event this year.

Fulton added, “When you take that out and you look at the core categories you want to perform through the summer months and back to hockey and back-to-school, we’re pleased where those are.”

Canadian Tire also said it was planning to increase its marketing spend to support opportunities at Sport Check. Said Fulton, “I think you’re going to see some more great brand work out of Sport Chek, consistent with what you’ve seen in previous years.

Wetmore further noted that Sport Chek had made recent advancements in its digital capabilities. The CEO said, “We have made remarkable progress in our online execution at Sport Chek, as the benefit of implementing the distributed order management system is even greater than originally anticipated. This improved ability to execute will be a critical importance as FGL seeks to grow its position as a digital marketing leader.”

Asked if FGL Sports would be impacted by the struggles and repositioning efforts at Nike, Under Armour and Bauer as well as those vendors’ moves to go direct, Fulton said the three mentioned brands are “major partners of ours, and they continue to be.”

Fulton added, “I would say that our relationship with those vendors is better today than it has been at any time since we made the FGL acquisition. And that’s evidenced by having access to a wider section of their product, having access to more digital marketing materials online. And they have certainly taken the view with us that if a customer is in any of our channels and are looking for their brand, they want to win with that customer through us. Longer term, they will, of course, remain an important partner to us.”

He also noted that partly in answer to its vendors going direct to consumers, FGL Sports is developing its proprietary brands as part of a “wholly-owned brand” strategy.

Said Fulton, “We think there’s a lot of runway given the premium shelf space we have and the premium position we play with the customer online in Canada that we can take wholly owned brands and treat them strategically, by which I mean, some brands could serve an opening price point purpose, other brands can compete with the very, very best premium brands available in the market.”

He noted that this week a new Woods premium apparel collection is being introduced to 20 Sports Chek doors in Toronto and Vancouver. Fulton added, “I think when you put that product up against the very, very best outerwear in the market, you’re going to be very impressed. So we have a journey here, and certainly, our expectations of where we’ll be in 2020 versus today with our own brands is high.”

Besides Sport Chek, FGL Sports also includes Sports Experts, Atmosphere, PHL, National Sports and Hockey Experts in Canada.

The sales slowdown follows a steady streak of strong gains for FGL Sports that soon followed its acquisition by Canadian Tire in 2011. Same-store sales at FGL Sports grew 6 percent in 2016, 4.4 percent in 2015, 6.9 percent in 2014, 7.7 in 2013 and 4.9 in 2012.

Photo courtesy Sport Chek