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SGI -  April, 5th 2010
 

SGI - April, 5th 2010

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Take a minute to catch up on the latest industry news with SGI Weekly Intelligence.

Take a minute to catch up on the latest industry news with SGI Weekly Intelligence.

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    SGI -  April, 5th 2010 SGI - April, 5th 2010 Document Transcript

    • VOLUME 2, NUMBER 14 APRIL 5, 2010 INSIDE: Industry Profits rebound in Q4 with apparel and retail leading the turn. Reebok execs see brighter future. We talk to the brass there and at parent Adidas. Titleist wins appeal on patent case with Callaway. Nike signs LeBron James to a new seven-year contract. Backcountry.com promotes key execs. Judy Spies: Wenger, Montrail Hibbett  General Growth Properties  Golfsmith  Shoe Carnival  U.S. consumer confidence  Warwick Mall  Callaway  Cerf  Ecco  New Balance  Orange 21  Phoenix Footwear  Puma  Total Apparel Group Ultra runner and Montrail- sponsored athlete Max King is shown here powering his way to a second place finish in the Way Too Cool 50K endurance race that was held last month in Cool, CA. King’s resume also includes back- to-back titles in the 2008 and 2009 XTERRA Trail Run Championships, and he was first across the finish line in the 2009 USATF Trail Marathon Championship. (For details on Montrail’s Fall 2010 trail running shoes, visit the new product department.) Photo courtesy of Montrail. INDUSTRY NEWS AND ANALYSIS FOR RETAILERS From the Editorial Team of Sporting Goods Intelligence
    • John Horan CHARTING NEW TERRITORY Publisher jhoran@sginews.com In an effort to stand out 610-459-4040 in a crowded market- Judy Leand place and to offer con- Editor sumers broader brand jleand@sginews.com perspectives, many compa- 718-858-2354 nies are rethinking their approaches to prod- Bob McGee Managing Editor uct development and marketing. bmcgee@sginews.com 508-279-3060 For example, on the product side, Wenger is returning to its roots in the active outdoor Robert Z. Feiner market by expanding its assortment of multi- Advertising Director functional products, slightly modifying its rfeiner@sginews.com logo, and aligning itself with marquee events 212-879-9200 and world-renowned Brand Ambassadors. Jon Bogert Meanwhile, over at Montrail, the mission is to Associate Publisher further insinuate the brand into the core trail jbogert@sginews.com running category by providing performance- 610-459-4040 driven footwear and by using top athletes as Rob Maturo both product consultants and marketing vehi- Circulation rmaturo@sginews.com cles. For further details, stop by the new prod- 610-459-4040 uct department. In the marketing realm, Maverik Lacrosse SGI Weekly Intelligence is published by Sporting has enlisted the aid of NFL Films cinematog- Goods Intelligence, Inc. raphers to create a new video/TV campaign 442 Featherbed Lane, Glen called “BE READY.” The detailed, super slow- Mills, PA 19342. motion spots feature top players in action, ©2010 Sporting Goods and showcase the sport in a new way. Check Intelligence, Inc. all rights reserved. it out the first of these new ads in the e-vent department. Click Here to Request a Subscription As you’ve come to expect, this week’s issue also includes the latest news and events from around the industry, so go ahead and start clicking! Judy Leand Editor PAGE 2 APRIL 5, 2010
    • INDUSTRY PROFITS REBOUND SHARPLY ON FLAT SALES IN Q4 After flushing last year’s impairment charges, restruc- turing costs, inventory liquidations and bloated expenses, sporting goods companies turned in a decent bottom line performance for the final quarter of 2009. The $924.2 mil- lion in aggregate profits compared to an aggregate loss in the year-ago quarter but are below the Q4 2006 record of $1,085.6 million in 2006. However, there was little help from the topline as sales improved a modest 2%. Return on Sales was a modest 3.76% this year compared to a loss of 0.58% last year. Our quarterly survey of sales and profits included the results of 60 public companies for the quarter ended near- est to Dec. 31. Profits are tabulated on the basis of GAAP net income except for the section on Diversified where we use GAAP operating profits before corporate, interest and tax ex- penses. Lowered SG&A and improved gross margins as a result of leaner inventories across the board were the major factors in improving the operating performance of Q4 over last year. Most companies headed into Q4 trying to backpedal on their 2008 optimism that put aggressive growth plans in place for 2009. In addition, there were some massive writedowns of in- tangibles and assets acquired during the cheap debt era from 2006-2008. With 2009 being the year when everyone tried to build up cash and pay down debt, this was no longer an issue by the end of the year. APRIL 5, 2010 PAGE 3
    • APPAREL: This sector had one of the more dramatic turnarounds, though it was primarily due to Quiksilver’s mis- adventure into the equipment sector with Rossignol. ROS improved to 3.13% from a loss of 7.35% last year. Excluding the $194 million loss from Quiksilver, the sector would have basically broken even last year. A near breakeven perfor- mance at Broder also helped the sector after a $54 million loss last year. Positive profit gains at Gildan and Under Ar- mour were also pluses for apparel. DIVERSIFIED: ROS based on operating profits improved to 9.65% from7.91% for the nine divisions of diversified com- panies covered. Operating income improved 29% on a 6% revenue gain. The category driver was VF’s Outdoor Coali- tion, which had a 45% gain in operating profit and accounted for 58% of the sector’s aggregated profits. Famous Foot- wear also had a swing from a loss to a profit, offset some- what by a larger loss in Fortune Brands’ golf business. FOOTWEAR: The 11 sneaker companies eked out a 1% revenue gain for the period and a 12% profit improvement, which brought ROS to 5.12% from 4.64%. Despite down profit performances by both Nike and Adidas Group in the sector, there were two notable gainers that offset the decline of the big boys. Crocs lowered its loss considerably and Ske- chers rebounded from a significant loss last year to a solid profit this year as it jumped on the toning trend early. Deck- ers also had a strong performance in a seasonally important quarter for its Uggs brand. EQUIPMENT: The 14 equipment companies compiled a Q4 that was less awful than the prior year as the aggregate PAGE 4 APRIL 5, 2010
    • loss decreased 36% on a 5% sales shortfall. ROS was –4.10 this year compared to –6.10 last year. The biggest factor in this year’s red ink was Brunswick’s massive $124 million loss, almost double the loss it had last year. Excluding BC, the ROS would have been 1.52% this year against a loss of –5.00% last year. Positives in the sector were Amer Sports, whose profit nearly doubled, and swings from large losses to profits at Freedom Group and Nautilus. Weak demand continues to plague the sector, especially in high ticket items from golf, fitness and winter sports. RETAIL: The 17 retailers surveyed swung from a huge loss spurred by restructuring and writedown charges back to modest profits in its seasonally biggest quarter. Big swings at the two biggest retailers, Dick’s and Foot Locker, accounted for most of the improvement. Collective Brands also low- ered its loss though it remained in the red. Only two retailers did worse than last year: Turnaround hopeful Pacific Sun- wear and Cabela’s. The scorecard table follows on page 8. PAGE 6 APRIL 5, 2010
    • Sporting Goods Intelligence Industry Scorecard Fourth Quarter 2009 Quarter SALES(000s) % EARNINGS(000s) % Ended Q4 '09 Q4 '08 Change Q4 '09 Q4 '08 Change APPAREL Broder Bros. 12/26 $ 182,800 $ 219,500 -17% $ (2,900) $ (54,000) 95% Columbia Sportswear 12/31 $ 358,316 $ 354,910 1% $ 23,086 $ 18,557 24% Delta Apparel 12/26 $ 91,160 $ 73,361 24% $ 979 $ 595 65% Gildan Activewear 12/31 $ 220,400 $ 184,000 20% $ 28,000 $ 4,400 536% Hanesbrands, Inc. 1/2 $ 988,739 $ 1,035,117 -4% $ (1,082) $ 17,881 -106% Iconix Brand Group 12/31 $ 65,782 $ 54,259 21% $ 20,822 $ 15,333 36% Quiksilver 1/31 $ 432,737 $ 443,278 -2% $ (5,354) $ (194,426) 97% Under Armour 12/31 $ 222,217 $ 179,279 24% $ 15,202 $ 8,321 83% Volcom 12/31 $ 63,495 $ 69,082 -8% $ 3,397 $ (8,749) 139% SUBTOTAL $ 2,625,646 $ 2,612,786 0% $ 82,150 $ (192,088) 143% DIVERSIFIED Brown Shoe-FAMOUS FW 1/30 $ 342,700 $ 312,300 10% $ 13,900 $ (11,900) 217% Dorel-PACIFIC CYCLE 12/30 $ 175,670 $ 157,894 11% $ 8,989 $ 3,172 183% Fortune Brands' GOLF 12/31 $ 226,900 $ 212,200 7% $ (37,300) $ (18,300) -104% Genesco-JOURNEYS 1/30 $ 225,356 $ 229,541 -2% $ 24,029 $ 24,464 -2% Genesco-HAT WORLD 1/30 $ 152,403 $ 122,409 25% $ 19,979 $ 14,770 35% Jarden-OUTDOOR 12/31 $ 517,000 $ 494,000 5% $ 50,200 $ 57,300 -12% VFC OUTDOOR/ACTION 12/31 $ 730,883 $ 675,745 8% $ 147,018 $ 101,420 45% VF Corp. IMAGEWEAR 12/31 $ 222,269 $ 242,688 -8% $ 26,013 $ 27,097 -4% Warnaco SWIMWEAR 1/2 $ 50,780 $ 46,163 10% $ 2,261 $ (767) 395% SUBTOTAL $ 2,643,961 $ 2,492,940 6% $ 255,089 $ 197,256 29% FOOTWEAR Adidas Group 12/31 $ 3,631,000 $ 3,387,000 7% $ 29,542 $ 71,053 -58% Crocs 12/31 $ 136,011 $ 126,092 8% $ (11,448) $ (34,701) 67% Deckers 12/31 $ 347,909 $ 303,506 15% $ 68,048 $ 40,340 69% Heelys 12/31 $ 15,598 $ 11,375 37% $ (5,238) $ (1,123) -366% K-Swiss 12/31 $ 42,020 $ 53,490 -21% $ (12,488) $ (13,714) 9% Nike 11/30 $ 4,405,600 $ 4,590,100 -4% $ 375,400 $ 391,000 -4% Puma 12/31 $ 723,043 $ 738,553 -2% $ 23,929 $ 10,658 125% Rocky Shoes & Boots 12/31 $ 61,660 $ 66,045 -7% $ 910 $ (2,241) 141% Skechers 12/31 $ 388,620 $ 298,088 30% $ 27,946 $ (20,378) 237% Timberland 12/31 $ 387,760 $ 390,626 -1% $ 22,254 $ 13,138 69% Wolverine World Wide 1/2 $ 312,530 $ 346,116 -10% $ 16,738 $ 24,117 -31% SUBTOTAL $ 10,451,751 $ 10,310,991 1% $ 535,593 $ 478,149 12% EQUIPMENT Aldila 12/31 $ 14,726 $ 11,535 28% $ 1,003 $ (1,344) 175% Adams Golf 12/31 $ 12,024 $ 12,490 -4% $ (6,717) $ (296) -2169% Amer Sports 12/31 $ 713,146 $ 651,711 9% $ 54,062 $ 23,289 132% Brunswick Corp. 12/31 $ 657,300 $ 837,700 -22% $ (124,000) $ (66,300) -87% Callaway 12/31 $ 185,852 $ 171,272 9% $ (15,555) $ (3,154) -393% Cybex Intl. 12/31 $ 34,811 $ 39,260 -11% $ 993 $ (10,874) 109% Easton-Bell Sports 1/2 $ 163,700 $ 169,200 -3% $ (15,300) $ (10,800) -42% Head Sports 12/31 $ 165,950 $ 151,355 10% $ (3,064) $ (1,629) -88% Johnson Outdoors 1/1 $ 70,460 $ 69,756 1% $ (4,236) $ (6,900) 39% The Nautilus Group 12/31 $ 53,672 $ 63,903 -16% $ 5,711 $ (41,234) 114% Freedom Group Inc. 12/31 $ 185,700 $ 201,600 -8% $ 6,300 $ (37,300) 117% Smith & Wesson 1/31 $ 89,379 $ 83,712 7% $ 2,380 $ 2,355 1% Sport Supply Group 12/31 $ 55,529 $ 53,175 4% $ 922 $ 1,052 -12% SUBTOTAL $ 2,402,249 $ 2,516,669 -5% $ (97,501) $ (153,135) 36% RETAIL Big 5 1/3 $ 237,629 $ 219,609 8% $ 6,386 $ 3,602 77% Cabela's 1/2 $ 919,168 $ 879,430 5% $ 16,600 $ 49,447 -66% Citi Trends 1/30 $ 169,811 $ 146,603 16% $ 11,251 $ 10,056 12% Collective Brands 1/30 $ 741,700 $ 735,200 1% $ (10,900) $ (144,000) 92% Dick's Sporting Goods 1/30 $ 1,336,590 $ 1,207,531 11% $ 67,360 $ (105,593) 164% Finish Line 11/28 $ 240,056 $ 240,571 0% $ 6,593 $ (8,843) 175% Foot Locker, Inc. 1/30 $ 1,325,000 $ 1,317,000 1% $ 23,000 $ (125,000) 118% GSI Commerce 1/2 $ 430,248 $ 391,380 10% $ 23,601 $ 23,069 2% Golfsmith 1/2 $ 63,850 $ 67,840 -6% $ (6,300) $ (6,487) 3% Hibbett Sports 1/30 $ 166,819 $ 147,926 13% $ 11,752 $ 7,633 54% lululemon athletica 1/31 $ 160,606 $ 103,921 55% $ 28,451 $ 10,938 160% Pacific Sunwear 1/30 $ 292,562 $ 351,681 -17% $ (36,499) $ (27,042) -35% Shoe Carnival 1/30 $ 170,790 $ 156,910 9% $ 2,554 $ (3,049) 184% Sport Chalet 12/27 $ 95,258 $ 104,562 -9% $ (3,800) $ (32,376) 88% Zumiez 1/30 $ 132,433 $ 125,464 6% $ 8,801 $ 6,297 40% SUBTOTAL $ 6,482,520 $ 6,195,628 5% $ 148,850 $ (341,348) 144% TOTAL $ 24,606,127 $ 24,129,014 2% $ 924,181 $ (11,166) 8377% PAGE 8 APRIL 5, 2010
    • REEBOK MUCH SMARTER, BETTER LOOKING THAN TWO YEARS AGO With the big success of the EZ Tone and a promising launch of Zig technology, the top brass at Reebok and its parent are planning their next moves with a confidence that Canton hasn’t experienced in years. They feel they have finally cleaned up the marketplace of promotional products, launched two concepts that can be extended on several lev- els from a product standpoint as well as internationally and promise a disciplined approach to the rollout. The discipline part, of course, has not always been con- sidered a strength for this brand. It has a history of getting a pretty good idea like the Pump and slapping it on every conceivable product immediately. The predictable result has been a short-term sales spike instead of a focus on building a long-term franchise position that gives the brand a clear identity in the minds of its consumers. That is what the new management says it is determined to change. The toning category right now is basically seen as a walking shoe with a twist. Instead of a dumbed-down running shoe, it is actually something with a real technology behind it. The idea of stressing muscles for walking is going to be expanded to other categories such as indoor training and running. A basketball product is also in the works. Ex- Numero Uno stresses that these are not designed for compe- tition necessarily but to help an athlete get more out of his/ her training. While sales are primarily to women now, the new Run Tone at Finish Line is for both genders with sales running 85/15 female, but long-term X-NU believes it can PAGE 10 APRIL 5, 2010
    • make that ratio closer to 60/40 or 55/45. It also promises a clear segmentation strategy by distribution channel. The toning product for mid-tier department stores, for example, won’t have the Air Transfer technology that’s sold in mall specialty and sporting goods stores. There is also an apparel launch for toning in 2010 with the product already set and the go-to-market piece in fine-tuning. Perhaps most interesting about toning is the po- tential X-NU believes exists outside the U.S. Early in- dications have been strong in all the key markets like Ger- many, the U.K., Russia, South Korea and Japan. The Reebok EZ Tone in Germany will get massive advertising support, the biggest campaign in Germany by any sneaker brand ever for a single concept, with the exception of the World Cup, X-N.U. says. That kind of investment strongly suggests that the brand has confidence it has resolved its supply chain is- sues with the category. It has already said it will sell over 5 million pairs of EZ Tone in the U.S. this year, and says it will deliver 90% on time. As for Zig, Reebok believes it has a concept that will sell well in sporting goods channels because it promotes more muscle efficiency during training but will also sell in mall specialty channels because of the striking cosmetics of the technology. It is now posi- tioned as a running/training product but will evolve into oth- er categories like basketball soon. Again, X-N.U. doesn’t see the technology necessarily going into competition product, but maintains that even an elite athlete will use the prod- uct because it allows longer training regimens by minimizing stress. The idea suggests that the bigger concept being cre- PAGE 12 APRIL 5, 2010
    • ated here is separating training footwear from competition footwear more clearly with the objective of getting an ath- lete to look at the workout as a separate activity requiring specific footwear. This was also the message behind Under Armour’s running shoe launch. Zig apparel is expected to hit the market in Spring 2011. Like the EZ Tone apparel, Reebok promises some functional details specific to Zig in the line and, of course, a strong visual tie to the footwear. As for the Adidas brand here, where executives have not looked as handsome nor sounded as clever as the ones at Reebok, the Big a reiterates that it will grow both in the U.S. and internationally in 2010. Some of the growth in 2010 will come from its traditional weakness in the mall chains, with the Originals wall in Foot Locker and the new NBA program in Champs. The majority is more likely to come in the sport- ing goods channel, where it is focusing on lightweight run- ning and, of course, football tied to the World Cup. Adidas believes the World Cup results will exceed its re- cord haul in 2006, despite the fact that it had a huge boost in 2006 from having the event in its home market when it sold 1.5 million of the German team kit alone. This year, it expects to sell between 500,000 and 1,000,000 for the Ger- man team, depending on the team’s performance, but points out that it has 12 teams in the event this year compared to only six in 2006. Some of its biggest boosts are coming from Mexico and sales from Spain are also expected to be very strong. A big driver in the category has been the advent of public viewings of the games, which has brought a more diverse audience than just hard-core fans out to enjoy the party atmosphere. APRIL 5, 2010 PAGE 13
    • TITLEIST SCORES VICTORY IN PRO V1 PATENT BATTLE WITH CALLAWAY Acushnet Co. successfully argued against Callaway Golf’s claims of infringement that technology in its Titleist Pro V1 family of golf balls was developed from 84 Acushnet patents and was first introduced to its PGA Tour players in Oct. 2000, well before Spalding golf ball patents were issued in 2001 and 2003. In Jan. 2006, before Callaway filed its litigation, Acushnet asked the U.S. Patent and Trademark Office to re-examine the four patents that would come into question in the lawsuit. During the process, according to Acushnet, seven separate PTO examiners each concluded they were invalid. In late Nov. 2008, Acushnet had asked a federal appeals court to overturn the decision of a Delaware federal district court that ordered it to stop selling its popular ProV1 golf ball immediately following a jury finding that several patents by a Spalding inventor were valid. The patents in question allowed the ball to combine the distance of a hard cover with the feel of a soft cover. In commenting on the jury verdict in the U.S. District Court in Delaware, Acushnet said it hoped the decision “fi- nally brings this long standing dispute to a close.” PAGE 14 APRIL 5, 2010
    • APRIL 5, 2010 PAGE 15
    • NIKE SIGNS LEBRON TO NEW ENDORSMENT DEAL The package extends the original seven-year, $90 mil- lion deal that the Cavaliers star signed when he exited high school in 2003. Speculation is that the new deal, also for seven years, includes only a modest raise to about $100 million as sales of LeBron product still fall well below those of Brand Jordan despite his superstar year on the court. Moreover, at this point in the basketball market, there are no other brands that could even entertain the idea of paying that kind of money to a player so connected to Nike. Among the more interesting bits in the media about the deal is the news that the contract does not include any bo- nus for James if he moves to a big market team, such as the Knicks. James becomes a free agent after this season. His original deal reportedly had a bonus clause if he moved to a big market team. PAGE 16 APRIL 5, 2010
    • BACKCOUNTRY.COM PROMOTES KEY EXECS Jill Layfield moves up to COO from VP of product devel- opment. Elsewhere, CMO Dustin Robertson adds corporate development; CFO Scott Klossner moves to CFO/SVP of sup- ply chain operations and Sam Bruni, adds GM of business unit operations. Its sales in 2009 were estimated at about $300 million, making it by far the largest Internet-only business in the specialty market. Backcountry.com was ranked 92nd in 2003 on Inc. Magazine’s list of fastest grow- ing companies when it had a 306% growth rate from 2000 to 2003. Besides the Backcountry.com site, it operates a number of niche sites aimed at mountain biking, surf/skate and other action sports. APRIL 5, 2010 PAGE 17
    • WENGER RE-COMMITS TO JUDY SPIES... OUTDOOR ROOTS WITH NEW PRODUCTS, MARKETING The 116-year-old brand, best known as the “Maker of the Genuine Swiss Army Knife,” is returning to its original brand position as a provider of multi-functional equipment in the active outdoor market. According to Wenger, the strategy “is more of an affirmation of our brand positioning rather than a change of our position.” To embark on its new mission, Wenger has slight- ly modified its logo and is using a “Seal of Authenticity” and a “Corner Knife” as brand assets that link back to the brand’s iconic Swiss Army knife. On the product side, the brand has ex- The Mike Horn Knife (SRP $135) includes an The Swiss-made Nomad LED Compass eco-friendly handle, two one-handed opening Watch (SRP $375) includes a PVD-engraved blades, needle-nose pliers, metal saw and file, bezel, surgical steel case, integrated can opener, and reamer. A hex-bit receptacle LED and traditional analog displays and in the flat portion of the handle includes three luminous numerals. It is also water- screwdriver bits. resistant to 330 feet. PAGE 18 APRIL 5, 2010
    • tended beyond pocket knives and watches with the addition of footwear, camping equipment and travel gear, all of which fit into the new brand ethos of multi-functionality. In the marketing arena, the company contin- ues its title sponsorship of the Wenger Pa- tagonian Expedition Race (the 2010 event recently concluded in February), and has aligned itself with world-renowned Brand Ambassadors. Global adventurer Mike Horn, the Alinghi sailing team, and pro- fessional mountaineer Ueili Steck are all on Wenger’s roster. The Wenger Patagonian Expedition Race, which bears the tagline, “The adventure at the end of the world,” is touted as the world’s tough- The RangerGrip 179 Wenger Patagonian Expedition Race knife (SRP $72.95) boasts est race. The eighth edition of the seven implements that perform 11 different event, which concluded in February, functions. The EvoGrip S18 model (SRP $69.95) includes a locking 2.5-inch blade. Both offer boasted more than 600km of trek- Wenger’s proprietary EvoGrip handle with king, kayaking, climbing and cycling rubber inlays that enhance handling and through the Tierra del Fuego re- performance, even in wet conditions. gion of Chilean Patagonia. Besides providing physical and mental chal- lenges, the race also helped spread a message of preservation in the region. All of this creates an ideal backdrop for Wenger to highlight its brand authenticity. Toward this end, the company recently launched the APRIL 5, 2010 PAGE 19
    • Wenger Patagonian Expedition Race line of products. The JUDY SPIES... collection includes three Swiss Army knives, a Swiss- made watch, footwear, technical packs, tents and sleep- ing bags. The products are designed to appeal to out- door extremists as well as enthusiasts. Similarly, Wenger is using its Brand Ambassadors to spread the corporate message and to help develop prod- uct. For example, the company has partnered with ex- plorer Mike Horn as he continues his four-year Pangaea Expedition that launched in 2008. The journey is intend- ed to increase awareness of man’s effect on the environ- ment and to actively participate in conservation efforts. Click here for a peek at the Wenger Patagonian Expedition Race: PAGE 20 APRIL 5, 2010
    • MONTRAIL’S FALL 2010 FOOTWEAR ON WINNING PATH In an effort to strengthen both its brand message and product, Montrail signed four elite trail and ultra runners to its 2010 roster, including national trail champion Max King (pictured on the cover of this issue). The other three ath- letes are Dakota Jones, Jill Perry and Mandy Hosford. Team Montrail, which now boasts 21 members, is already playing a critical role in the growth of the Mon- trail brand and the development of the company’s expanding line of trail footwear. On the product side, Montrail is now launching two key trail shoes for Fall 2010: The Sabino Trail GTX is a performance running shoe designed the Mountain Mas- to offer stability and protection on rugged terrain. ochist Mid GTX (SRP $135), and Sabino Trail GTX (SRP $120). The Mountain Mas- ochist Mid GTX (also available in a low-cut version), features a Gore-Tex waterproof/ breathable lining, a webbing and strap clo- APRIL 5, 2010 PAGE 21
    • sure system for improved fit and comfort, midfoot lateral JUDY SPIES... and medial dual-density trail stability posts, and breathable hydrophobic mesh uppers. A mid-height Neoprene col- lar provides articulated support. The Sabino Trail GTX has a lightweight synthetic leather and nylon mesh upper, thermoplastic midfoot shank and forefoot Trail Shield for torsional rigidity and underfoot protection, and a Gore-Tex waterproof/breath- able lining. Both models are available in gender-spe- cific sizes. The Mountain Masochist Mid GTX offers protection from the elements in a lighter, less bulky package than traditional mid- height models. PAGE 22 APRIL 5, 2010
    • E-VENTS MAVERIK ‘READY’ WITH NEW TV ADS Long Island City, NY-based Maverik Lacrosse and its creative video production arm, Maverik Films, recently re- leased the first in a series of super slow-motion video/tele- vision commercials in a campaign titled “BE READY.” The first spot, which features Major League Lacrosse star Paul Rabil demonstrating one of his 111 mph shots, is airing during ESPNU’s coverage of the 2010 NCAA men’s lacrosse season now in progress. Jay Jalbert, co-founder of Maverik Lacrosse and direc- tor/producer of Maverik Films, worked with NFL Films cin- ematographers to capture, in slow-motion detail, the pas- sion that Maverik’s “Soldiers” bring to lacrosse. According to Jalbert, the goal was to use state-of-the-art slow-motion camera equipment to showcase lacrosse in a way not seen before. The spots are unique in their use of Phantom HD camera technology that films at a rate of 1,000 frames per second, allowing for crisp, slow-motion detail. Click here to see the first commercial in Maverik Lacrosse’s new “BE READY” campaign. APRIL 5, 2010 PAGE 23
    • RETAIL BRIEFS HIBBETT SPORTS 10-K NOTES: • Has increased store base by 11% to 767 doors over the last two FYs. • Approximately 75% of store base is in a strip center. • Has identified 350-375 potential markets for future stores in existing markets where it operates. • Believes current distribution center can support over 1,200 stores. • Nike represented 49.9% of purchases vs. 51.4% in the prior FY. Second largest vendor represented 9.0% in FY10 vs. 8.4% the year before. • Will increase store base by 2% in FY11 vs. 3% and 8%, respectively, in FY10 and FY09. • Four Southeast States (AL, GA, LA and MS) account for 34% of door base. Florida and Texas combined account for another 15% of door base. • Gross advertising expense declined 9% in FY10 to $5,572,000 from $6,145,000, but net advertising costs (including reimbursements from vendors) rose 7% to $3,304,000 from $3,091,000. • Began accepting consignment inventories in FY10, end- ing the fiscal year with $300,000 worth in its stores. PAGE 24 APRIL 5, 2010
    • ABERCROMBIE & FITCH, EBAY, JC PENNEY, NIKE and SEARS are among 23 defendants named in a Mar. 29 federal suit in Tyler, TX, by Parallel Networks LLC. The complaint contends the defendants are infringing on a patent for “Method and Apparatus for Client-Serve Communications Using a Limited Capability Client Over a Low Speed Commu- nication Network.” GENERAL GROWTH PROPERTIES, the mall operator, has a $6.55 billion equity capital investment from Brookfield Asset Management, Pershing Square Capital and Fairholme Capital to help it emerge from Chap. 11. The investment combined with a $1.5 billion debt issuance will enable the company emerge where it will form a new entity, General Growth Opportunities, to oversee its real estate portfolio. GOLFSMITH reports that Tiger Woods’ off-course issues over the last six months have not negatively impacted sales of his Nike-branded golf products in its 74 stores. In report- ing “no noticeable or precipitous drops in unit sales” over the past several months, GOLF said its unit sales of Tiger-Woods branded golf products rose 8% for the 24 weeks ended March 13 year-over-year to 9,564 units. TW hats were the hottest product category during the period, rising 24% y-o- y. Woods’ scheduled return to play next week for The Mas- ters coincides with his next introduction of products, also slated for this month. SHOE CARNIVAL and Acacia Research Corp. reach a settlement on a patent that applies to credit card fraud pro- tection technology at the retail chain, resolving federal litiga- tion pending in Georgia. APRIL 5, 2010 PAGE 25
    • U.S. CONSUMER CONFIDENCE INDEX is 52.5 in March, up from 46.4 in Feb. , as compiled by The Confer- ence Board from a representative survey of 5,000 house- holds. Nonetheless, there remains U.S. consumer concern about current business and labor market conditions, the Conference Board reported. “And their outlook for the next six months is still rather pessimistic. Overall, consumer confidence levels have not changed significantly since last Spring.” In the March survey, those U.S. consumers claiming conditions are “bad” decreased to 42.8% from 45.1%, while those stating business conditions are “good” rose to 8.6% from 6.8%. Meanwhile, those saying jobs are “hard to get” fell to 45.8% from 47.3% in Feb. WARWICK MALL, near Providence, RI, was under wa- ter due to torrential rains, forcing it to shutter for the first time in its 40-year history. The mall’s parking lot was turned into a lake with water up to door level, forcing the closure of 70 odd retailers, including a Sports Authority store PAGE 26 APRIL 5, 2010
    • ON THE MOVE • Big 5 Sporting Goods opens a store in Tehachapi, CA, some 35 miles east-southeast of Bakersfield. • Dick’s SG is slated to open in a former Macy’s at the River Valley Mall in Lancaster, OH, that already houses a Dunham’s. • Foot Locker CEO Ken Hicks signed a letter on March 23 to irrevocably waive his entitlement to the cash annual bonus for the company’s FY09 year as stated in his employment contract of June 25, 2009. • Sport Chalet recently signed up the millionth member to its Action Pass reward program, awarding the customer, Gonzalo Talavera of Saugus, CA, a $1,000 Sport Chalet gift card. • Global Footwear Market is projected to hit $232.1 billion in value in 2013, representing 18.1% growth since 2008, according to a new report from Research and Markets of Dublin, Ireland. APRIL 5, 2010 PAGE 27
    • COMPANIES CALLAWAY will provide a full set of the Diablo Edge clubs to any MLBer who hits a home run that travels at least 470 feet. There were 10 such home runs in 2009, according to hittrackeronline.com, which collects data on every long ball. There were also 27 homers last season that traveled between 460 and 469 feet. CERF PRODUCTS names outdoor industry veteran Erik Specht, most recently the president of Mountainsmith, as president of the former Cerf Brothers Bag Co. that was ac- quired by Ameribag Inc. in Jan. In his new post, Specht will oversee the HideAway, CampInn and licensed Browning brands and product lines, directing sales, marketing, product and budget strategies. Following his appointment, Specht sets his executive team at Cerf. It will include Ron Hyde as VP of sales, Lonnie Drosihn as VP of product development and George Grabner as Emeritus advisor. Grabner, who most recently served as Cerf’s interim CEO, was previously presi- dent and CEP of American Recreation Products. ECCO shoes and accessories sales declined 6% in FY09 to DKK 4,846,352,000 ($876.8 mm) from DKK 5,129,113,000. Sales in ECCO Americas were off 9% to DKK 928,681,000 ($168.0 mm). The Danish company invested DKK 129 million ($23.3 mm) in sales, marketing and new store costs. ECCO ended FY09 with 901 doors and 1,278 shop-in-shops. NEW BALANCE inks a multi-year endorsement con- tract with Red Sox Dustin Pedroia, who will wear a special PAGE 28 APRIL 5, 2010
    • make-up of the New Balance 1101 baseball spike, including a version in his signature camouflage colors. Besides being Pedroia’s official footwear and off-field apparel provider, New Balance will team with him to support their sponsorship of the Run to Home Base 9K to benefit “The Red Sox Founda- tion and Massachusetts General Hospital Home Base Pro- gram.” ORANGE 21 had a net loss was $3,407,000 against a loss of $15,212,000 for the 12 months ended Dec. 31. An- nual sales declined 28% to $34,238,000 from $47,276,000 as gross margins slipped 460 b.p. to 40.4%. ORNG said it would continue to control costs and improve operational ef- ficiencies to minimize possible future losses. PHOENIX FOOTWEAR GROUP net income was $1,026,000 against a loss of $14,903,000 for the pe- riod ended Jan. 2 due to income from the divestiture of Chambers and a tax gain. Total sales slipped 25% to $4,434,000 from $5,921,000. Gross margins declined 400 b.p. to 31.0%. Meanwhile, PXG reduced its FY net loss to $6,991,000 versus a loss of $19,460,000 despite a 33% de- cline in annual revenues to $19,939,000 from $29,571,000. The loss from discontinued operations was $1.7 million ver- sus $11.1 million in FY08. Over the last year, Phoenix has reduced its cost structure by millions of dollars, bank debt by 74% and liabilities by $11.6 million. At year-end, backlog was up a reported 37%. PUMA adds soccer sensation Natasha Kai to its endorse- ment roster. The Cat says the signing is evidence of its com- mitment to Women’s Professional Soccer and the game as APRIL 5, 2010 PAGE 29
    • a whole. Puma intends to utilize Kai, a forward for the WPS Champion Sky Blue FC, in its football (soccer) and fitness marketing campaigns and, because of her crossover ap- peal, incorporate her into the brand’s lifestyle activities too. Hawaii-born Kai is known as much for her vibrant personality and explosive play as her tattoos that have attracted atten- tion both on and off the pitch. The Olympic gold medalist was Sky Blue’s leading scorer in the league’s inaugural season. TOTAL APPAREL GROUP reports that it has booked over $2.5 million in product orders. TAG is continuing to work on completing its audited financial statements so that it may become a fully reporting company. Due to a decision to include FY09 financial statements and Q1/10, the compa- ny now expects to complete and file the statements with the SEC no later than May 17. PAGE 30 APRIL 5, 2010
    • RECALLS SPORT OBERMEYER is recalling approximately 3,900 Vietnam-made girl’s ski jackets due to a waist drawstring that can pose an entrapment hazard. The recalled styles are: Lily #91549, Rose #91552, Daisy #91555 and Posey #91558. Various boutiques and ski/sport retailers sold the jackets between July 2009 and Feb. 2010. ARDICA TECHNOLOGIES, a San Francisco-based im- porter, is recalling approximately 2,600 jackets and vests with Moshi Power Systems. NORTH-SPORTIF INC., of New York, is recalling about 360 jackets and 360 vests due to possible drawstring stran- gulation. The boys’ black hooded jackets were sold exclu- sively at Burlington Coat Factory stores between Oct. 2002 and Jan. 2010. BAUER HOCKEY is recalling approximately 67,000 youth and junior hockey sticks, shafts and blades in the U.S. and another 60,000 in Canada due to excessive lead levels in the paint. The recalled, China-made products were sold in sporting goods stores between Feb. 2005 and last month. APRIL 5, 2010 PAGE 31
    • SHORT STOPS • K-Swiss partners with Amos Content Group and Rhino.com to launch California Music Month. • Fulgent Sun International, which has been making footwear in China for the past 15 years, files an IPO for a listing on the Taiwan Stock Exchange. • Amon Carter donates $5,000 to Batters Up USA, which supports start-up recreational ball programs for boys and girls. It intends to use the donation to increase participa- tion in inner-city recreational baseball/softball programs. • Wolverine World Wide hires industry veteran Nick Schwartz, most recently at Columbia Sportswear, as VP of sales for apparel and accessories to focus on Merrell apparel. • Ryn Footwear names Heath North as marketing man- ager for North & South America. He was previously head of consumer marketing for MBT. • Nivea signs a multi-year contract as title sponsor and ex- clusive skin and personal care product of the AVP Tour. • International Junior Golf Tour is partnering with the Canadian Junior Golf Association to provide playing privileges to each other’s members at over 160 events. • Gita Sporting Goods hires Ed Adair as a sales rep for a newly created western territory in No. CA. • KARHU says it will reach over 50,000 runners in the first year of its 10+ major city half-marathon sponsorship of the 13.1 Marathon race series. PAGE 32 APRIL 5, 2010
    • CATALOG OF CATALOGS Click on the logo to view the catalog. APRIL 5, 2010 PAGE 33