New Chief Orders Shake-Up at Reebok

Nov. 9, 2016 Issue N°18 New chief orders shake-up at Reebok FNE# 18 eebok is to undergo size- Rorsted was particularly Some of the comments sug- able cuts in staff and unimpressed that Reebok stores, in the latest mea- failed to raise its sales in North You’re reading Fitness News Europe, the independent Rsures to improve the gestedbrand ifthat the resultsAdidas dowould not imbe- business news publication for preparedprove, as someto sell investors the fitness have executives in the international - Americagrowth infor the the region last inthree the fitness industry. With an brand’spany will profit move margins. out of its As cam part- years.third quarter, Reebok but did with return a sales to - online portal and a bi-monthly ofpus the in changes,Canton, near the fitness Boston, com and beenness, advocatingwhich should for leadsome to time. 150 newsletter, Fitness News Europe Perhaps least acceptable for jobThe losses cutbacks among in thethe U.S. brand’s busi provides reliable business news The cuts do not affect the Eu- increaseRorsted, ofthe just Reebok 2%. brand’s and often exclusive analysis on intoropean the city.structure for Reebok, meant to tackle wider issues the fast-moving fitness market. which has delivered ample ex- 950 employees in Canton, are Check out fitnessnewseurope. profit margin remains way structure and the way it oper- com for further information about the publication, to register brand managed a global sales with the fitness brand’s cost for a free trial and obtain your pansion so far this year. The subscription at a special launch for the third quarter, with an ates. rate. rise of 3.6% to €493 million willRorsted move explainedto a location that that650 ofhas Reebok’syet to be foundU.S. inemployees a vibrant increase of 7.2% in constant- currencies.rope area, which The turnoverbasically covwas- have been offered relocation CONTENTS upers byEurope 15% inwith the the Western exception Eu areato Portland of Boston. – almost Another literally 150 Shake-up at Reebok ....p1-4 of Russia and the former CIS at the other end of the country, Berlin clubs snapped up .1-6 Cybex weaker than But Kasper Rorsted, who - projected ..........................p2 countries.took over at the beginning of below the level of the Adidas in Oregon, where the Adidas Flat forecast for Octane ..p2 October as chief executive of brand. The gross profit for Ree Group has its North American Technogym claims market bok reached 36.7% in the third head office. These changes share gains ......................p3 owner, found that the growth quarter,“It’s time compared to get backwith 45.6%to the come at a cost of about €20 Gym pass groups target the Adidas Group, Reebok’s forgym Adidas. and redouble our efforts million.plan is to accelerate the closure Swiss market ...................p5 on Reebok,” Rorsted said in a Another major part of the ClassPass scraps Unlimited wasevery lagging member behind has Adidasto contrib and- - plan ..................................p5 manyute to rivals. the Assuccess, in team said sports, the ofReebok U.S. stores.factory Theoutlets new would chief Basic-Fit above openings Danish handball enthusiast in conference call. He was previ executivebe shuttered said by thatthe endabout of the20 target ...............................p6 a conference call with analysts ouslycompany, chief where executive he led at Henkel,a turn- Vivafit goes Saudi ...........p5 the German consumer goods Continued on page 4.... year. Technogym last week. around. Other news Q1 2016 (€ 000, %) Club operators snapping up Berlin gyms Adidas (px), Clever Fit (p7), olmes Place is taking for women with a pool on the - Fit20 (p7), Fitbit (p3), Garmin over at least one of the Bismarckallee, in the Char- Q1 2016 Change (p3), Puma (p4), Skechers (p4), Place clubs in Germany are sit Reebok (p4), UK Active (p7) Sales 115,574 + 11.2% H Berlin, as the receiver- open next week and turn into a uatedCandy infacilities Berlin. asThe an group opportu was- ship ofHard the companyCandy clubsthat was in lottenburg district. It will re- eyeingnity to threemove of toward the former its target Hard Italy 10,875 +12.8% - The receiver is in talks for the of building a national premium Europe many opens up prominent lo- mixedsale of clubtwo Superwomenearly next year. clubs, 62,022 +14.5% (excl. Italy) running the concept in Ger and some of the landlords have - been talking directly with in- chainerally inunderserved Germany. with regard North America 10,484 +19.9% cationsCandy gyms in the and country’s another capital. four “The German market is gen Fitness News Europe is Asia Pacific 15,758 -5.6% Jopp AG, which ran nine Hard Management, a company set is room for a national player published by Zelus (France) temporary insolvency in June, terestedup in September parties. byClays two Sportsinves- toin thethis premium category,” market. said DoronThere Editor: Barbara Smit Latin America 5,852 +58.7% [email protected] Superwomen facilities, filed for tors in real estate, is apparently Dickman, general manager for @ All rights reserved. MEIA (*) 10,583 -3.8% [email protected] as previously reported. Full- - deputy chief executive of the The information published in this newsletter fledged proceedings started in opening another fitness club at Holmes Place in Germany and cannot be copied or distributed electronically September. the former Hard Candy loca Continued on page 6.... Holmes Place has taken over tion on the Clayallee. Holmes Place Group. without the publisher’s written permission. the former Hard Candy club Five out of the eleven Holmes FITNESS NEWS Europe 1 Top Gear Cybex weaker than projected he acquisition of Cy- previous estimate primarily bex International has division at Brunswick Corpora- relates to the acceleration of yielded lower sales and The turnover of the fitness tothat double the shoppingthe size of spree its fitness isn’t our cost reduction and facil- T it has proved costlier divisionover just yet,by 2020.and some It appearssources ity integration activities,” said than anticipated so far for the tion was up by 20% to $237.6 predict another buy before the - millioncurrencies, for with the about quarter. 17 per It- The adjusted operating spires from the group’s third movedcentage up points by 21% of that in constantincrease Schwabero. owner of Life Fitness, it tran end of the year. Mark Schwabero, chief ex- Without acquisitions and in margin of the fitness division quarterecutive earnings.of Brunswick Corpo- constant currencies, the fitness waswhich down was attributedby 0.7 percentage to unfa- ration, said in a conference division’s sales were up by 4% pointsvourable to 13.3%changes for in the the quarter, sales call that “sales of Cybex prod- for the quarter. This included an mix and increased investments ucts have been unfavourably organic sales increase of 5% in affected by some changes in Europe, up 26% including the Schwabero said that Cybex distribution and decreasing acquisitions and 19% in reported tocontributed push the group’smodestly expansion. to the terms. European sales accounted - Yet still, Brunswick remains forExcluding about 20% theof the acquisitions Life Fitness chase accounting adjustments demandupbeat about for certain the prospects products.” of division’sand in salesconstant last year. currencies, operating profit, including pur - of $1.4 million in the quarter. theIt points fitness to market robust and demand the out in salesrest of were the world,flat in withthe U.S. growth and For the first three quarters of- come of its latest acquisitions. Elevation Series Photo: Life Fitness theyin all movedregions up other by 10% than in Latin the thisstant year, currencies the fitness and excludingdivision’s favourable trends in the re- turnover was up by 5% in con- thehabilitation fitness cluband activemarket aging and coming from the latest acqui- erating margin was down by category, along with increased sitions, Cybex and the Indoor America.clubs and hotels,The demand while sales in thede- acquisitions. Its adjusted op participation in group exercise U.S.clined chiefly in other came channels, from fitness from Brunswick bought Cybex for 1.8The percentage Brunswick points group to saw 12%, its - Cycling Group (ICG). chiefly due to Cybex. activities.cent Cybex acquisition have then said that the group’s turn- retaildivision to governmentincurred restructuring orders. million for the quarter, with trailed“While our revenues initial expectations, of our re $195 million in January and- andFurthermore, integration the of Lifecharges Fitness of sales rise by 10% to $1,093.0 we are continuing to make out- - currencies and without acqui- standing progress integrating over reached about $169 mil- an increase of 6% in constant lionplier in of 2015. indoor In Julycycling it snapped equip- $2.4 million in the quarter re- segment and remain on plan up ICG, the German-based sup latingwick isto acquisitions,projecting that and such$8.8 sitions.Brunswick Its net is profitprojecting firmed sales up thisto achieve business our into near-term our fitness and - million so far this year. Bruns by 13% to $85.4 million. long-term earnings objec- ment with sales of about €37 half of it from acquisitions,and tives for this acquisition,” said millionbeen on inthe 2015, acquisition at an trailundis in costsincrease will in rise the torestructuring about $12 growthslight improvements of about 10% in for gross the year, and closedthe last price.year, asLife part Fitness of its goalhas millionand integration for the costsfull year. from “The our SchwaberoOctane in a statement. sales to stagnate foroperating the profit margins.year - and sharply increased sales to re- growth,” as he said in a conference call he acquisition of Octane Fitness- tion the company for future profitable significantly, to ensure a profitable re- T turn on media investment. The media milliontailers for the enabled third quarter,Nautilus although Inc.

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