Fitness: Did you hear?…
Consumer Reports analyzes energy bars, Northern Lights Vector on its way, German sporting goods on the upswing, Precor to be at Germany's ispo summer show, Bally and TSI first quarter results, Discovery Health Channel's "Buff Brides" reality show
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>> The latest Consumer Reports magazine (June 2003) has an analysis of athletic energy bars, taking a look at ingredients (calling some “iffy”), while also pointing out how confusing it is to consumers since the formulations are different despite being lumped under one label of “energy bars.” The magazine also pointed out that some “overdo it” when it comes to minerals and vitamins with 100-percent fortification that could put a user over the top. “While the big-name bars we evaluated did not contain ‘extras’ such as caffeine, ginseng, guarana or ephedra, some products may,” the magazine warned. “So scrutinize labels and avoid bars with unnecessary or questionable additives.” The magazine doesn’t actually rank or rate them, but instead lists them (the likes of PowerBar, Clif Bar, Met-Rx, Kashi, and Balance) breaks out nutritional differences and makes a few comments about taste or texture.
>> The latest additions to the new light commercial line by Northern Lights, called Vector, will be released next month. Nine pieces are shipping now. The new line out of Canada has gotten great reviews from industry insiders, we’re told.
>> In The (Portland, Ore.) Oregonian on May 11 appeared a story titled “Beyond Bowflex” by writer Boaz Herzog. “Slumping results prompt The Nautilus Group to expand its array of physical fitness products and move into stores instead of just direct sales. The Nautilus Group’s muscles have gone flabby — and it’s struggling to bulk up again. The exercise equipment-maker, which became an industry powerhouse through the strength of its Bowflex machine, is seeing its sales, profits and stock price plummet after peaking last year. And industry observers are beginning to doubt that Nautilus has enough oomph to regain its form,” the article said. “The fall could be quite hard,” senior research analyst Brent Rystrom of Minneapolis-based brokerage firm U.S. Bancorp Piper Jaffray wrote in a recent report. The Vancouver-based company has taken steps to move beyond Bowflex. Recent product introductions and an acquisition spree have given Nautilus more equipment to peddle. And it’s trying to increase sales by moving those products — including the Bowflex, which previously was sold primarily through infomercials — into more retail stores. Want to see the whole thing? Click here
>> GERMANY — Sporting goods recovered slightly in Germany in April, showing an average gain in sales of 1.6 percent, according to the trade news magazine Spomo. The figure was derived from a survey of 94 retailers across the country. That means that for the first four months of the year, average sales were up 2.7 percent compared to last year. That’s turned into a bit of a recovery from last fall when sales were very weak.
>> Bally Total Fitness Holding Corp. (NYSE: BFT) has for the quarter ended March 31, net income of $9.7 million ($.30 per diluted share), versus $19.4 million ($.59 per diluted share) in the prior year quarter, down about 50 percent. Net revenues increased 5 percent to $253.1 million during the quarter. Cash flows from operations ($19.3 million) less cash used in investing activities ($9.8 million), free cash flow, was $9.5 million. “Bally’s results for the first quarter of 2003 show areas where we achieved success, and areas where we need improvement,” said Paul Toback, president and CEO. “Consistent with our strategy to generate free cash flow during 2003, we are on target to reduce this year’s capital spending to approximately $50 million, which is less than half the average annual outlay during the previous three years. Also, beginning with the second quarter, companywide cost reduction initiatives are expected to reduce annualized spending by $12 million.” For details, go to www.ballyfitness.com
>> GERMANY — Life Fitness will be sponsoring the treadmills on the Runner’s World stage at the summer ispo show in Germany, in the running segment of the sporting goods show. Visitors will be able to try them out between demos. In addition, Precor will be at the Munich summer show, June 29 to July 1, for the first time, sharing space in an Amer Group booth.
>> A letter of intent has been signed and the move for Quantum Fitness Corp. to acquire CadEx Fitness Systems will be finalized by the end of the month. Quantum, a 14-year-old Houston, Texas-based, company manufactures a variety of weight-training products. Don Foley, COO of Quantum, stated, “It was time for us to expand our business. With the addition of the CadEx product offering, we add cutting edge and unique products, like the Lower Limb Series and the converging motion stations. These products will have an immediate impact in the club and medical markets.” CadEx Fitness Systems is a New Jersey-based corporation.
>> InSport International has selected Gary Fleshman as the new director of sales. Fleshman has more than 20 years of experience in strategic business growth and sales development initiatives. His positions at Nike included director of strategic accounts, Europe; director, sales training and development, Europe; and global strategic accounts manager, military. An avid runner, Fleshman at one point owned a running specialty store in Salem, Ore.
>> Sears, Roebuck and Co. (NYSE: S) has announced that comparable domestic store revenues decreased 8.5 percent for the four weeks ended May 3. Total domestic store revenues were $2 billion, an 8 percent decrease compared with the four weeks ended May 4, 2002. “Hardlines revenues declined, partially due to our Easter store closing and strong seasonal product sales in March,” said chairman and CEO Alan J. Lacy.
>> More “reality” shows aka “this can’t be real:” The Discovery Health Channel has started production in and around New York City on a new reality series called “Buff Brides.” “Every bride-to-be wants to look and feel fabulous on her wedding day and now Discovery Health Channel is helping a group of blushing, and very busy, women make that dream a reality,” a statement gushed. The series follows more than 20 brides (Ed. Note: We presume they mean brides to be) for 12-16 weeks as they slim down and tone up to look their best in a wedding dress, all while planning the wedding of their dreams. The TV channel “follows them every step of the way.” Oh, ouch. It will premiere in October. If you just can’t wait, find out more at www.discovery.com/health.
>> Town Sports International (TSI), which owns and operates 129 health clubs on the East Coast, has announced revenues for the three months ended March 31 of $86.9 million, an increase of $10 million, or 13 percent over the same quarter of 2002. During the quarter, TSI’s mature clubs (those in operation for 24 months or longer) experienced revenue growth of $1.3 million, an increase of 1.8 percent. The company received a $1.3 million on-account business interruption insurance payment in January 2003. These insurance proceeds were received in connection with the company’s four clubs that were temporarily closed due to the events of Sept. 11, 2001, and such proceeds have been recorded with fees and other revenue. Operating income for the quarter was $14.2 million compared to $8.9 million in the first quarter of 2002, while net interest expense increased to $4.2 million from $4.1 million. “Over the past year we have decreased the rate of new club openings, focusing instead on the operations of our existing clubs, as well as support functions,” said CEO Bob Giardina.
>> An animal rights group sued Germany’s adidas-Salomon AG in a San Francisco Superior Court on Wednesday, alleging the company is selling cleats that include kangaroo products barred in California. The suit also named several California stores that sell the Adidas cleats and running shoes that they say use kangaroo leather. The case seeks to halt imports of those products. “Adidas is getting away with murder in Australia and California,” said Lauren Ornelas, an official at Viva!, the Davis, Calif.-based, animal rights group that sued. “They are showing the same disregard for California law that the hunters show the baby kangaroos whom they bludgeoned to death.” One of the stores named was a single small independent store near Sacramento, Calif., whose owner told the local paper that he didn’t know why it was targeted. “Nearly every soccer store in the states sells kangaroo shoes,” he said. “I’m surprised we were named.” adidas has not commented.