Fitness financials: Gaiam's Q3 sales rise on increased trade business, plus Big 5, Sport Chalet, Garmin, adidas

Gaiam's Q3 sales rose on increased trade business, Big 5's Q3 profit rose 80 percent, Sport Chalet's sales dropped 7.9 percent, Garmin's Q3 profit rose while sales stumbled, and adidas was optimistic despite a 29.7-percent dip in Q3 profit.

Gaiam’s Q3 sales rise on increased trade business

Gaiam (Nasdaq: GAIA) experienced a 23.5-percent jump in third-quarter sales boosted by its trade business, which reported over 24-percent growth in sales to retailers compared to the same quarter last year.

Revenue for the third quarter ended Sept. 30 was $74.4 million from $60.3 million recorded in the same period last year.

Gross profit increased to $35.8 million, or 48.1 percent of revenue, for the third quarter of 2009, from $33.8 million, or 56.1 percent of revenue, in the comparable quarter last year.

Selling and operating expenses decreased to $31.6 million or 42.5 percent of revenue during the third quarter of 2009, from $34.0 million or 56.5 percent of revenue last year.

Operating income increased to $945,000 from a loss of $17.3 million. Gaiam’s prior year results included a $13.9 million pre-tax impairment charge related to the company’s acquired media libraries, website development costs and related assets.

The company also generated free cash flow of $1.8 million, an $11.3 million improvement from the free cash flow use of $9.5 million during the same quarter of the prior year.

Big 5 Q3 profit up 80 percent

For the third quarter, Big 5 Sporting Goods (Nasdaq: BGFV) said its profit surged 80 percent as sales climbed and it better managed inventory.

For the quarter ended Sept. 27, it earned $8 million, or $0.37 per share, compared to $4.5 million, or $0.21 per share, a year earlier.

Revenue rose 4 percent to $231.6 million from $223.2 million. Same-store sales were up 1.6 percent during the quarter.

Gross profit was $78.5 million, compared to $74.3 million in the third quarter of the prior year. Its gross profit margin was 33.9 percent versus 33.3 percent last year.

Selling and administrative expense as a percentage of net sales improved to 28.2 percent in the fiscal 2009 third quarter versus 29.6 percent in the third quarter of the prior year.

The company reported that sales trends have continued to improve so far in the fourth quarter. It expects fourth-quarter profit to be in a range of $0.28 to $0.38 per share.

Also, the company declared a $0.05 quarterly dividend to be paid Dec. 15 to shareholders of record as of Dec. 1.

Sport Chalet sales drop 7.9 percent

Sport Chalet (Nasdaq: SPCHA and SPCHB) narrowed its second-quarter net loss and saw its sales drop 7.9 percent hurt by a soft economy.

For the quarter ended Sept. 27, sales were $88.8 million versus $96.5 million last year. The company said that three new stores not included in same-store sales contributed $2.3 million in sales for the quarter, while same-store sales decreased 12.4 percent.

Net loss was $1.2 million, or $0.09 per diluted share, compared to a net loss of $4.2 million, or $0.30 per diluted share. This year’s second quarter did not reflect any net tax benefit, the company said, while last year’s second quarter reflected a net tax benefit of $2.8 million, or $0.20 per share. Without the tax benefit, last year’s net loss would have been $7.0 million, or $0.49 per share.

Gross profit as a percent of sales increased to 28.0 percent for the second quarter of fiscal 2010 compared to 26.5 percent for the second quarter of fiscal 2009. Selling, general and administrative expenses as a percent of sales decreased to 24.8 percent from 29.6 percent in the same period last year.

Garmin’s Q3 profit up while sales stumble

Garmin (Nasdaq: GRMN) said profits were up in the third quarter as improved pricing and lower costs offset a drop in sales.

It earned $215 million, or $1.07 per share, compared to $171.2 million, or $0.82 per share, a year ago. Excluding foreign exchange effects, it says it earned $1.02 per share.

Total revenue was $781 million, down 10 percent from $870 million in third quarter of 2008.

The outdoor/fitness segment revenue increased 11 percent to $132 million. The company said the category again showed its strength, posting year-over-year revenue growth with strong gross and operating margins.

It also said that North America and Europe continued to experience year-over-year revenue declines while Asia improved. North America revenue was $503 million compared to $585 million, down 14 percent. Europe revenue was down 4 percent to $237 million compared to $247 million, while Asia revenue was up 8 percent to $41 million compared to $38 million.

Gross margin improved to 52.4 percent compared to 44.3 percent in third quarter 2008 and declined slightly from 52.6 percent in second quarter 2009.

Operating margin improved to 30.3 percent compared to 24.6 percent in the third quarter of 2008 and 29.8 percent in the second quarter of 2009.

adidas optimistic despite 29.7 percent dip in Q3 profit

Despite drops in third-quarter profit and revenue, adidas (ADSG.DE) said it is confident of consumer demand heading into the Christmas season and believes the “worst is over.”

adidas has been dealing with declining sales across the world as cash-strapped consumers reduce discretionary spending. To alleviate the impact, it launched a broad cost-cutting program earlier this year, which already showed effect and helped prop up third-quarter net profit.

Third-quarter net income fell 29.7 percent to EUR 213 million (USD $313 million), on sales of EUR 2.89 billion (USD $4.25 billion), down 6.3 percent.

The company said it still expects 2009 group margins and earnings per share to decline due to higher operating costs and sees group sales down by a mid-single-digit rate. It expects full-year net income at EUR 230 million (USD $338 million) to EUR 260 million (USD $382 million).

(Conversion of Euros into U.S. dollars is for information only, is not necessarily relative to earnings, and is based on the currency rate as of Nov. 4.)

–Compiled by Wendy Geister

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