Global sportswear giants post strong financial gains in 2024

Sports & activewear segment gave an overall strong performance for the period ended September 2024, with four out of seven companies delivering strong, and two moderate financial results. While Japanese companies reported consolidated results of half-year and nine-month periods, the others reported second and third quarter results depending on their financial year. Two each, Japanese and European companies, grew both in sales and profits; one each, European and Canadian companies, grew in either of them, while one American company could improve neither.

Strong: Growth In Both Sales & Profits

Goldwin Inc (TYO: 8111)

Goldwin Inc ended the second quarter (Q2) of FY24 on September 30 and reported a consolidated six-month (April to September) performance in early November. For the period, net sales were ¥53,367 million (~$355.28 million), increasing 4.4 per cent from last year’s ¥51,096 million (~$346.16 million) during the same period. Ordinary profit also registered a growth of 8 per cent and amounted to ¥9,917 million (~$66.02 million) versus ¥9,180 million (~$61.11 million) in 2023, while the profit attributable to owners of the parent stood at ¥7,865 million (~$52.36 million), increasing 7.4 per cent. On a six-month basis, earnings per share (EPS) grew from last year’s ¥162.48 to ¥174.94 this year.

The owner of outerwear and activewear apparel and accessories brands, such as Goldwin, The North Face, Helly Hansen, Woolrich, icebreaker, macpac, and Fischer, the Tokyo exchange-listed company maintained its full-year consolidated financial results forecasts announced on May 14, 2024.

Amer Sports (Anta) Products Limited (NYSE: AS)

Amer Sports’ third quarter and nine-month financial results delivered a 'Strong' performance with both sales and profits growing over the same periods last year.

For the third quarter, revenue increased to $1,354 million, up 17 per cent both in reported and constant currency terms, encompassing growth in technical apparel (up 34 per cent), outdoor performance (up 8 per cent), and Ball & Racquet Sports (up 11 per cent). Gross margin for the quarter increased 420 basis points to 55.2 per cent and net income rose 257 per cent to $56 million, or $0.11 diluted earnings per share.

For the nine-month period ending September 30, 2024, the revenues in the current fiscal rose to $3,547 million from $3,072.9 million of last year, while the net loss of $113.9 million last year changed to a net income of $61.3 million this year.

Sharing its full year 2024 (ending December 31, 2024) guidance, Amer Sports, a global portfolio of iconic sports and outdoor brands, including Arc’teryx, Salomon, Wilson, Peak Performance, Atomic, and Armada, expects a revenue growth of 16 to 17 per cent, gross margin of 55.3 to 55.5 per cent, operating margin towards the high end of 10.5 to 11 per cent, and fully diluted EPS of $0.43 to $0.45.

ASICS Corporation (TYO:7936)

ASICS, the Japanese multinational corporation that produces sportswear, reported net sales of ¥525,454 million (~$3,483 million) for the consolidated nine-month period ended September 30, 2024, and registered a 17.3 per cent growth over last year’s net sales of ¥448,105 million (~$2,970.19 million) for the same period. The company, headquartered in Kobe, Hyogo, reported ordinary profit and profit attributable to owners of the parent of ¥88,279 million (~$585.14 million) and ¥64,940 million (~$430.44 million), respectively, for the period, with both increasing 61.2 per cent. The basic EPS increased to ¥89.61 (from ¥54.97 in 2023) and diluted EPS increased to ¥89.55 (from ¥54.92 in 2023) for the reported period.

For full FY24 ending December 31, 2024, the company’s projections are net sales of ¥680,000 million (up 19.2 per cent), operating profit of ¥100,000 million (up 84.4 per cent), ordinary profit of ¥96,000 million (up 89.5 per cent), and profit attributable to owners of the parent of ¥63,000 million (up 78.6 per cent), with basic EPS of ¥86.93.

Adidas AG (ATR: ADS)

The third quarter was a very strong one for Adidas, better than expected.

Currency-neutral revenues increased 10 per cent and 7 per cent in euro terms to €6.438 billion (~$6.72 billion), compared to €5.999 billion last year, inclusive of the sale of parts of the remaining Yeezy inventory of around €200 million, compared to around €350 million previously. The gross margin increased 2 percentage points to 51.3 per cent, compared to 49.3 per cent, and net income from continuing operations increased to €469 million, compared to €270 million, with basic and diluted EPS increasing to €2.44, compared to €1.40.

The revenues for the nine months period reached €17.718 billion (~$18.45 billion), rising over €16.616 billion during the same period of 2023. For the period, the gross margin increased 2.7 percentage points to 51.1 per cent against 48.4 per cent a year prior. The net income increased significantly to €851 million compared to €343 million of last year, putting Adidas's performance in the ‘Strong’ category.

On October 15, the Herzogenaurach-based company raised its top- and bottom-line guidance as a result of the better-than-expected performance during Q3 FY24: currency-neutral revenues are now expected to increase at a rate of around 10 per cent compared to the earlier forecast of a high-single-digit rate, and operating profit is projected to reach a level of around €1.2 billion against the previous forecast of €1 billion.

Moderate: Growth In Either Sales Or Profits

Puma SE (ETR: PUM)

The currency-adjusted sales of Puma for the third quarter of FY24 increased by 5 per cent to €2,308.2 million (~$2,442.04 million), supported by growth in the Americas, Asia/Pacific, and EMEA despite currencies negatively impacting sales in euro terms by approximately €100 million in Q3 2024, resulting in a -0.1 per cent reported growth rate. The early November release by the company reported that the currency-adjusted sales growth was driven by sales of footwear, up 9.3 per cent, and wholesale, up 1.5 per cent, which demonstrated a return to growth.

The gross profit margin for the Herzogenaurach-headquartered sports company improved by 80 basis points to 47.9 per cent compared to 47.1 per cent in Q3 2023; operating expenses (OPEX) increased by 1.1 per cent to €873 million (~$923.62 million), compared to €863.7 million in Q3 2023; and the operating result (EBIT) rose by 0.3 per cent to €237 million (~$250.74 million), compared to €236.3 million (~$250 million) in Q3 2023. Net income, however, decreased by 3 per cent to €127.8 million (~$135.21 million), compared to €131.7 million in Q3 2023, with an EPS yield of €0.86 against €0.88 in Q3 2023, mainly due to a higher net income attributable to non-controlling interests as a result of a stronger socks and bodywear business in the US.

The 2024 outlook by the company expects the currency-adjusted sales growth at a mid-single-digit percentage rate and EBIT in a range between €620 million and €670 million. Furthermore, the company expects net income to change in 2024 in line with the operating result, compared to €304.9 million in 2023.

Gildan Activewear Inc (NYSE & TSX: GIL)

Gildan Inc reported record third quarter and nine-month performance, which ended on September 29, 2024, covering revenue and adjusted diluted EPS, and updated its full-year FY24 guidance on October 31, 2024. The Montreal-based activewear company reported net sales of CA$891 million (~$629 million), a rise of 2.4 per cent over the net sales of Q3 FY23, at the high end of previously provided guidance of flat to low single-digit growth.

The company generated a gross profit of CA$278 million (~$196 million), or 31.2 per cent of net sales, compared to CA$239 million, or 27.5 per cent of net sales, in the same period last year, representing a 370 basis point improvement primarily driven by lower raw material and manufacturing input costs. The operating income stood at CA$193 million (~$136 million) vs. CA$155 million, or 21.7 per cent vs. 17.8 per cent of net sales, including the negative impact of expenses for the proxy contest, leadership changes, and related matters. Adjusted operating income was reported at CA$200 million or 22.4 per cent of net sales, in line with guidance provided, and up CA$43 million or 430 basis points compared to the prior year.

For the nine months period, net sales were CA$2,449 million (~$1,728.31 million), up 1.5 per cent versus the same period last year. The company generated operating income of CA$439 million (~$310 million), or 17.9 per cent of net sales, compared to operating income of CA$466 million or 19.3 per cent of net sales last year. For this, Gildan’s performance classifies under ‘Moderate’.

For the full FY24, the company’s revised outlook now includes revenue growth to be up by low single digits compared to previous guidance of flat to up low single digits; the adjusted operating margin to be slightly above 21 per cent compared to the previous guidance of slightly above the high end of the company’s 18 per cent to 20 per cent target range; and adjusted diluted EPS in the range of CA$2.97 to CA$3.02 compared to previous guidance of CA$2.92 to CA$3.07.

Weak: No Growth In Sales & Profits

Under Armour (NYSE: UA, UAA)

In an early November release, Under Armour reported its Q2 and H1 2025 financial results. For the second quarter, the net revenues of Under Armour dropped from $1.56 billion in the previous year to $1.4 billion, down 10 per cent in constant currency, while net income increased from approximately $105 million to $170 million, up approximately 62 per cent. On a half-yearly basis, net revenues fell from $2.883 billion last year to $2.582 billion in 2024. Likewise, last year’s net income of $115 million (4 per cent of sales) changed into a net loss of $135 million (-5.2 per cent of sales) in H1 2025, registering a ‘Weak’ performance.

Headquartered in Baltimore, Maryland, Under Armour, Inc is an inventor, marketer, and distributor of branded athletic performance apparel, footwear, and accessories.

In May 2024, Under Armour announced a restructuring plan designed to strengthen and support the company's financial and operational efficiencies. Following further evaluation, in September 2024, the company announced additional restructuring actions primarily related to the decision to exit one of its distribution facilities in Rialto, California.

Updating the FY25 outlook, the company now expects revenues to decline at a low double-digit percentage rate, including a 14 to 16 per cent decline in North America as the company works to reset this business, a low single-digit per cent decline in its international business, and flat results in EMEA offset by a high single-digit decline in its Asia-Pacific business due to macroeconomic pressures. The operating loss is expected to be $176 to $196 million, compared to the previous expectation of $220 to $240 million.

ALCHEMPro News Desk (SB - WE)