Fitness financials: Shares of Brunswick climb on consumer confidence, plus Sport Chalet, Under Armour

Shares of Brunswick climb on consumer confidence

Shares of Brunswick Corp. (NYSE: BC) climbed more than 14 percent in trading July 29, after a private research group said consumer confidence rose during the month and oil prices fell to a seven-week low. Brunswick is the parent company of Life Fitness, Parabody and Hammer Strength.

Shares climbed as high as $13.96 — a 14 percent increase — during afternoon trading. It closed the day at $13.77, up $1.54 from the previous day.

The stock, which is down nearly 28 percent since the start of the year, has been battered by poor economic news about lowered discretionary spending and a massive slowdown in boat sales — a core business segment for the company.

But it got a boost when The Conference Board reported consumer confidence rose to 51.9 in July, up from 51 in June. And oil prices reached their lowest level since June 10, falling as low as $120.42 a barrel.

The suburban Chicago manufacturer has said it will reduce its hourly and salaried work force by 1,000 jobs and may slash up to 1,700 more jobs as further cost-cutting initiatives are completed. The company already laid off about 1,500 marine employees and announced plans to close eight boat plants. By the time the most recent rounds of layoffs and closures are completed, Brunswick’s marine division will have been cut by about 25 percent since January.

Brunswick shares have a 52-week range of $9.29 to $28.53.



Sport Chalet suffers slow sales, wider loss in Q1

Sport Chalet (Nasdaq: SPCHA and SPCHB) said sales for the first fiscal quarter were down 4.8 percent, hit by soft macroeconomic conditions and to a lesser extent, new store openings by the company and competitors in certain markets.

Sales for the quarter ended June 29 were $87.1 million versus $91.6 million in the same period last year. Eight new stores not included in same store sales contributed $5.5 million in sales for the quarter while same store sales decreased 11.1 percent.

Net loss for the first quarter of 2009 was $4.5 million, or $0.32 per diluted share, compared to a net loss of $664,000, or $0.05 per diluted share, for the first quarter last year.

Gross profit as a percent of sales was 26.1 percent compared to 28.6 percent for the first quarter of last year. It said the decline was primarily due to increased rent as a percent of sales in newer stores. Selling, general and administrative expenses as a percent of sales increased to 29.8 percent from 25.9 percent in the same period last year, reflecting the decrease in comparable store sales and the expenses associated with new stores which take time to ramp up.

Under Armour’s Q2 profit falls 75 percent

Despite a 30-percent boost in sales, Under Armour (NYSE: UA) said soft margins and marketing expenses caused second-quarter profit to drop 75 percent.

Profit slipped to $1.4 million, or $0.03 per share, from $5.7 million, or $0.11 per share, in the same quarter a year ago.

Sales rose 30 percent to $156.7 million from $120.5 million.

Under Armour said gross margin declined to 45.3 percent from 49 percent because of higher sales of shoes, which have lower gross margins than apparel. Sales of shoes accounted for 29 percent of total revenue compared with 17 percent a year ago.

Marketing expenses for the second quarter of 2008 were 14.4 percent of revenue compared with 13.5 percent in the prior year.

Selling, general and administrative expenses rose to $67.6 million from $50.9 million.

Under Armour raised its income from operations outlook between $104.5 million and $105.5 million, versus a previous expectation for results between $103.5 million to $104.5 million.

It expects sales to rise between 26 percent and 28 percent from 2007, or between $765 million and $775 million.



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