#142/2016-12-05

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WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

NEWS ALERTGLOBAL SPORTING GOODS INDUSTRY UPDATE

Record number of participants at WFSGI Manufacturers Forum 2016 2

adidas unveils world’s first performance shoe made from biosteel® fiber 2

Mizuno decreases net sales and net income in 1Q and 2Q of FY2016 ending March 31, 2017 3

Puma is gaining in the third quarter - CEO Björn Gulden satisfied 3

An investment subsidiary to accelerate business tie-ups with startup companies establishment of “ASICS Ventures Corporation” 4

Giant looks to Japan and southeast Asia for growth as Chinese market slows 6

Accell Group records rise in turnover in third quarter 6

Colnago sells direct online in the US 7

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WFSGI NEWS ALERT: #142/2016-12-05

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

RECORD NUMBER OF PARTICIPANTS AT WFSGI MANUFACTURERS FORUM 2016

The 4th edition of the WFSGI Manufacturers Forum 2016, held in Tai-chung/Taiwan on November 15-16, was sold out. A record-breaking number of more than 200 delegates from 20 countries studied the multi-faceted transformation brought about by digitalization, innova-tion and robotics, over two days of fast-paced and captivating presen-tations.

Some of the presentations appeared almost like science fiction, and yet they have started to impact many aspects of sporting goods pro-duction – from the digitalization of footwear and apparel to the man-agement of human resources in factories and the geography of manu-facturing, among other topics discussed at the fourth WFSGI Manufacturers’ Forum.

Christian Decker for instance, Managing Director at DESMA, a Ger-man supplier of injection machines and automation equipment for the shoe production, explained that the industry has been shifting toward smaller lot sizes, declining warehouse inventories, growing product variation and a sharp rise in consumer influence. “I am con-vinced that in the near future new production modules will allow companies soon to establish shoe production in urban locations and consumers could have “freshly baked shoes” of their choice made for them while they have a (very) quick coffee in a New York store”.

“It is the goal of our meanwhile very well established yearly Forum to provide an exceptional density of high-level keynote speakers, includ-ing keynote lectures, panel discussion, educational workshop and practical inputs like a factory or tradeshow visit. The delegates of the Forum shall have excellent networking possibilities and the event should always offer cross-industry exchange, providing insights and innovation from the automotive and electronics industry”, stated Robbert de Kock, Secretary General of the WFSGI.

The WFSGI has partnered with ISPO to hold the fifth Manufacturers’ Forum in conjunction with Productronica, a trade fair for electronics development and production. The event will be held in Munich on November 14-15, 2017. Separately, the WFSGI also confirmed that it was jointly organizing a World Cycling Forum with Bike Europe on June 7-8, 2017 around the topics of Consumer Centricity and Lean Manufacturing.

A detailed report will be provided by WFSGI’s media partners SGI Eu-rope and Bike Europe.

Find all pictures of the WFSGI Manufacturers Forum 2016 here.

Source: WFSGI

ADIDAS UNVEILS WORLD’S FIRST PERFORMANCE SHOE MADE FROM BIOSTEEL® FIBER

The adidas Futurecraft Biofabric features include being 100% biode-gradable through a fully natural process.

• The adidas Futurecraft Biofabric features include being 100% biodegradable through a fully natural process

• adidas has partnered with AMSilk for the first premium innova-tion footwear made using silk biopolymers

• Concept shoe unveiled at renowned Biofabricate Conference in New York

adidas has unveiled the world’s first performance shoe made using Biosteel® fiber – a replication of natural silk – at the Biofabricate Con-ference in New York.

The adidas Futurecraft Biofabric prototype shoe features an upper made from 100% Biosteel® fiber, a nature-based and completely bio-degradable high-performance fiber, developed by the German bio-tech company AMSilk. The material offers a unique combination of properties that are crucial in performance, such as being 15% lighter in weight than conventional synthetic fibers as well as having the po-tential to be the strongest fully natural material available.

In addition, Biosteel® fiber also provides a far more sustainable offer-ing, with it being 100% biodegradable in a fully natural process. This continues adidas’ journey of sustainable innovation – from a starting point of virgin plastics, to recycled plastics, to its partnership with Parley for the Oceans and now a totally new frontier of investing in solutions that leverage science and nature as an integral part of in-novation.

The shoe was unveiled at the renowned Biofabricate Conference in New York as adidas and AMSilk announce a partnership that will ex-plore the use of Biosteel® fiber in performance products on a larger scale.

James Carnes, Vice President of Strategy Creation at adidas, said:“In a year of ground-breaking innovations from adidas, the announce-ment of our partnership with AMSilk – and the unveiling of the adidas Futurecraft Biofabric shoe – is another step in our commitment to redefining the sports industry.”

Read the full article here.

Source: adidas Group

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WFSGI NEWS ALERT: #142/2016-12-05

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

MIZUNO DECREASES NET SALES AND NET INCOME IN 1Q AND 2Q OF FY2016 ENDING MARCH 31, 2017

Overview• Net sales decreased by 3.9% to 93.1 billion yen.• Operating income was 498 million yen (down 65.1%). Net loss

before tax was 420 million yen (-%). Net income after tax for the current term was 705 million yen (down 51.5%) due to extraordi-nary income.

• Net sales decreased by 3.6 billion yen due to the effects of ex-change rates.

• Net sales in the Americas were significantly lower year-on-year due to the worsening sports goods market conditions in North America.

• Net sales in Japan, Europe, Asia and Oceania were higher year-on-year on a local currency basis.

By region<Europe> Net sales were 8 billion yen, down 5.8%. • Running shoes sales continued to be strong.Indoor shoes sales were strong and their usage rate was high in inter-national competitions.• The weakness of the British pound caused somewhat less than

one billion yen of non-operating exchange loss.

<Americas> Net sales were 13 billion yen, down 20.3%..• Worsening sports goods market conditions (Bankruptcy of large

retail chains)• Oversupply of running shoes and other products for stock in the

market as well as intense competition• Mizuno had a difficult time in terms of business in South America

due to the sluggish economy in Brazil and the weak Brazilian real.

Read the full article here.

Source: Mizuno

PUMA IS GAINING IN THE THIRD QUARTER - CEO BJÖRN GULDEN SATISFIED

Sportswear manufacturer Puma has produced good business figures for the third quarter of 2016. CEO Björn Gulden emphasizes the new product lines and praises the prominent brand ambassadors for Usain Bolt.

The sports brand from Herzogenaurach’s sales increased by 11 per-cent, to 990 million Euro, compared to the previous quarter. Puma registered growth in every region, the strongest in America at a cur-rency-adjusted 12.2 percent.

The most successful product segment was Shoes, which brought 16.4 percent more sales than last year and, at 458.8 million euros, repre-sented nearly half of sales.

The company’s overall sales have climbed by 10 percent, to 2.669 bil-lion euros, in the past nine months of the fiscal year.

CEO Björn Gulden: “Sales continuously improving”According to CEO Björn Gulden, sales have “developed somewhat better than anticipated, and the gross profit margin also met our ex-pectations and, together with strict cost control, lead to an improve-ment of our results.”

“Sales of our products in retail continuously improved in the third quarter,” said Gulden. “New product lines like Fierce, Platform, Ignite Dual, and the Fenty collections have met with great feedback from our consumers, and our brand desirability has continued to climb through our successful marketing with our brand ambassadors like Rihanna, Kylie Jenner, and Cara Delevingne, as well as through the outstanding performances by Usain Bolt.”

New partnership with popstar The WeekndUsain Bolt sprinted to three gold medals in Puma shoes at the Olym-pic Games in Rio. In total, athletes outfitted by Puma won 24 medals at this year’s Summer Games. In September, Puma launched the col-lection “Fenty Puma by Rihanna” on the market.

In addition, the company announced a partnership with Abel Tesfaye, known as popstar The Weeknd. With him, the company is advertising the sports style campaign “Run the Streets,” first presented in early November.

Source: ISPO News

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WFSGI NEWS ALERT: #142/2016-12-05

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

AN INVESTMENT SUBSIDIARY TO ACCELERATE BUSINESS TIE-UPS WITH STARTUP COMPANIES ESTABLISH-MENT OF “ASICS VEN-TURES CORPORATION”

ASICS Corporation announces the establish-ment of ASICS Ventures Corporation. The new wholly-owned subsidiary will be a cor-porate venture capital arm for ASICS globally, an investment company to accelerate busi-ness tie-ups with startup companies.

From its foundation, ASICS has produced, and delivered to the market, a wide variety of truly innovative products and services, pre-dominantly in sport arena, backed by our continued challenges in developing highly sophisticated sport science technologies.

We believe that ASICS can further accelerate our continued quest for innovations, leverag-ing business development with startup com-panies that have innovative products and services, technologies and people.

ASICS wishes to further ensure our sustaina-ble growth through capital and business tie-ups with startup companies that would cre-ate customer values if combined with ASICS group resources.

Source: Asics Corporation

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

5Any questions? Contact Yves Möri, WFSGI Communication & Bicycle Manager Phone: +41 31 939 60 61, Fax: +41 31 939 60 69, E-mail: ymoeri@wfsgi.org

WFSGI NEWS ALERT: #142/2016-12-05

BERGHAUS SUSTAINABILITY INITIATIVE WINS MAJOR AWARD

Berghaus is celebrating after success at The Great Outdoors Awards 2016. Organised by the long-running magazine The Great Outdoors, the awards celebrate the best new developments in outdoor prod-ucts. As well as achieving Highly Commended in two categories, Berghaus won the Sustainability award for its ground-breaking MADEKIND initiative, which was launched earlier this year.

MADEKIND is an umbrella programme that Berghaus has developed, to reduce the impact on the environment of its business activities, and it has become a core element of the company’s product develop-ment process.

The project is led by Elaine Gardiner, Berghaus’ sustainability man-ager.

To earn the MADEKIND tag, Berghaus products must meet at least one of three criteria: be made out of a bluesign® approved fabric (Berghaus is the first UK clothing brand to sign up to the bluesign® system); be made using the award winning Colourkind fabric dyeing process; or be made using recycled materials.

Berghaus has placed a particular focus on reducing water use in prod-uct manufacture, recognising the increasing pressure that is being put on this limited resource by growing populations and industrialisation. This was highlighted by the World Economic Forum which put water scarcity at the top of its global risk ranking for 2015. Colourkind uses 89% less water than standard fabric dyeing techniques and Berghaus has already saved several million litres of water through the process.

The Great Outdoor Awards’ jury of experts praised Berghaus MADE-KIND for being a fully rounded and well thought through initiative and one which represented a significant step by the brand.

Source: Pentland

HAPTIC ILLUSION

Huafeng’s exciting Haptic 3D additive manufacturing technology re-cently added another fantastic design opportunity – Haptic Illusion.

When looking at Haptic Illusion effects your brain gets activated with-out you realizing what happens. Out of your own unconscious imagi-nation your brain is calculating new color and 3D effects. In some cases even moving action! Creating an actually non-existing color ef-fect only by the power of people’s brains is unbelievable crazy and in addition extremely efficient and sustainable!

Contact: thomas.schmidt@huafeng-cn.com

Source: Huafeng Textile Group

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WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

6Any questions? Contact Yves Möri, WFSGI Communication & Bicycle Manager Phone: +41 31 939 60 61, Fax: +41 31 939 60 69, E-mail: ymoeri@wfsgi.org

WFSGI NEWS ALERT: #142/2016-12-05

Giant has outlined ambitions to do more business in Japan and South-east Asia following a gloomy set of financial results.

In the latest set of financials the world’s largest bike maker saw a revenue dip of 6.5% during the first nine months of 2016. Giant’s turnover for the period amounted to TWD 44.23 Billion, with operat-ing income taking a 19.9% hit year-on-year.

Speaking to Nikkei Asian Review following the release of the figures, CEO Tony Lo explained that the Chinese market for bicycles had tanked.

“Beginning last year, this year, and next year, the China market will be down,” Lo told the site. “We see rapid growth in the Southeast Asia although revenue contribution is still low. It took us 30 years to de-velop the culture of cycling in Taiwan, and in China, i took us 20 years. I think it will take us around 10 years for Southeast Asia to pick up this cycling trend.”

When assessing the fortunes of Giant across the globe, the latest fig-ures evidence a sharp decline in China’s worth to Giants business, which in FY 2015 amounted to 24% of trade. Thus far in FY 2016 it now looks to be worth just 20%.

The slack has been picked up a little by Japan and Europe, which have both posted share growth in Giant’s business. Europe, North America and China represent over 70% of Giant’s NT$60.4 billion revenue. This, outlines Lo, is where Japan (5%) and Southeast Asian market’s (-1%) can build on a relatively small base.

Speaking on global markets, Lo said that Giant would continue to hire local expertise in order to blend in.

“In Japan, we look like a Japanese company and in the U.K., we would look like a U.K. company.”

Source: Cycling Industry News

ACCELL GROUP RECORDS RISE IN TURNOVER IN THIRD QUARTER

Accell Group N.V. realised higher turnover in the third quarter of 2016 compared to the same period of 2015, primarily driven by a higher contribution from E-bikes. Higher discounts to reduce seasonal inven-tories of regular bikes put downward pressure on third quarter re-sults. For the full year 2016, Accell Group expects an increase in turn-over and profit around the same level as 2015.

René Takens, Chairman of the Accell Group Board of Directors: “The market conditions for bicycle sales in the third quarter were comparable to those in the first half of the year. Weather conditions had a negative impact on bike sales in many countries. Turnover in E-bikes continued to increase, in particular E-performance bikes. The strong growth of E-performance bikes is partly at the cost of sports bikes, which is a trend we are seeing in most of our sales markets. This development contributed to the decline in turnover from regular bikes. The order intake for the new 2017 collection is positive, once again in particular for our sports brands. In the US, we implemented the omni-channel strategy and continued to adapt our organisation. The Raleigh brand is now sold via specialist retailers, as well as via online retailers and direct online sales. We are working with a mobile services provider for some of our direct deliveries in the US. The first effects of our new supply chain organisation have become visible in greater delivery reliability and reduced working capital.”

Turnover in both bicycles and bicycle parts increased in the third quarter. Virtually all countries in Europe contributed to the turnover growth. In the US, turnover declined due to difficult conditions in the specialist retail trade, the loss of sales via two large multi-sports chains (due to bankruptcy) and the divestment of the bicycle parts activities. Accell Group is now seeing the first effects of the new om-ni-channel strategy. This strategy is expected to compensate for the reduced sales via the specialist retail trade in the US. Turnover in the UK was down in the third quarter, partly as a result of the decline of the British pound following the Brexit vote.

Due to lower sales in the summer months a greater number of bikes was sold at a discount at the end of the season, which had a negative impact on the added value. In addition, the cost of materials was im-pacted by higher guarantee costs (primarily related to electric bikes) and a stronger Yen, which raised the purchase prices of gear group sets and electric motors.

Read the full article here.

Source: Accell Group

GIANT LOOKS TO JAPAN AND SOUTHEAST ASIA FOR GROWTH AS CHINESE MARKET SLOWS

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

7Any questions? Contact Yves Möri, WFSGI Communication & Bicycle Manager Phone: +41 31 939 60 61, Fax: +41 31 939 60 69, E-mail: ymoeri@wfsgi.org

WFSGI NEWS ALERT: #142/2016-12-05

VISTA OUTDOOR POSTS DOUBLE-DIGIT GROWTH IN 2017 FISCAL Q2

Vista Outdoor, parent of Camelbak, Giro, Bell, Bushnell and other brands, posted sales of $684 million for the second quarter of its fis-cal 2017. That’s up 24 percent from the prior-year quarter. The results included $106 million from recent acquisitions. On an organic basis, sales were up 5 percent for the quarter.

Vista Outdoor CEO Mark DeYoung said the strong results were thanks to acquisitions and strong performance in its shooting sports seg-ment. But both outdoor and shooting sports delivered organic sales growth for the quarter.

Vista Outdoor acquired Camp Chef during the quarter, which pro-vides the company a foothold in the camping market with an outdoor cooking brand.

Gross profit was $185 million, up 24 percent from the prior-year quar-ter. This includes $32 million of gross profit from acquisitions; organic gross profit was up 3 percent. Operating expenses were $81 million compared to $88 million a year ago, the decrease reflects an acquisi-tion claim settlement gain related to the purchase of Bushnell.

The company repurchased approximately 1,074,000 shares for $44 million. Since Oct. 2, Vista has repurchased about 724,000 additional shares for $28 million.

DeYoung said Vista Outdoor continues to see positive Point of Sale data trends in the face of a continuing softness at retail. And he ex-pects the soft retail environment to continue for the balance of the year.

“Some retail consolidation in the outdoor recreational market has caused ripples and waves by retailers and wholesalers,” DeYoung told investors during an earnings call Thursday. “They’re just cautious. The retail environment in general is sluggish and has been slow. Consum-er spending has been slow for a while and retail is impacted by that. We thought we’d see a stronger back half because we get into holiday and hunting season. We still believe that.”

The company reaffirmed its fiscal guidance for the year, with estimat-ed sales ranging from $2.72 to $2.78 billion.

Source: Bicycle Retailer

COLNAGO SELLS DIRECT ONLINE IN THE US

Consumers are able to purchase previous model year bikes and frames from Colnago’s US website, but local retailers to assemble and deliver bikes.

Colnago has launched an online sales platform in the U.S. Through the program, consumers are able to browse and purchase previous mod-el year products, which will be assembled and delivered through local retailers.

The program, first announced to authorized Colnago dealers over the summer, is designed to drive online consumers back into brick-and-mortar retailers, the company stated in a press release.

Now available on Colnago’s U.S. website, consumers can purchase bicycles and framesets at reduced prices, but are required to select from a list of nearby retailers for shipping. Retailers will remain fully involved — from assembly to delivery of the bicycle to the end user, according to Colnago.

All current model year bicycles and frames will still be exclusively available for purchase through authorized Colnago dealer showrooms or previously authorized online retailers, the company said. 2017 models will not be included in the program.

“It was important that we introduce a new way for U.S. customers to purchase Colnago products online,” said Billy Kanzler, national sales manager of Colnago America. “We’re looking forward to collaborat-ing with independent bicycle dealers across the country.”

Retailers have the ability to opt out of the program, but are encour-aged to sign up as incentives will be provided to participating bike shops.

Source: Bicycle Retailer

WFSGI – WORLD FEDERATION OF THE SPORTING GOODS INDUSTRY

8Any questions? Contact Yves Möri, WFSGI Communication & Bicycle Manager Phone: +41 31 939 60 61, Fax: +41 31 939 60 69, E-mail: ymoeri@wfsgi.org

WFSGI NEWS ALERT: #142/2016-12-05

STRENGTHENING OF MANAGEMENT STRUCTURE ACCELL GROUP

As per 1 January 2017, Accell Group N.V. appoints Wouter Jager as Brand and Marketing Director of Accell Group. The appointment marks a next step in the strengthening of Accell Group’s coordinating role.

Wouter Jager will transfer his current responsibilities as Managing Director Commerce Accell Nederland to Huub Snellen, Managing Di-rector Operations, who will take up the Managing Director role for Accell Nederland as per 1 January 2017. With this appointment we enter a new phase in the integration process of Accell Nederland which started several years ago.

Source: Accell Group

ORBEA FOCUSES ON OMNI-CHANNEL DISTRIBUTION

Orbea switches to omni-channel for which the Spanish bike maker recently built an attractive site. Here consumers can order bicycles, e-bikes, eMTBs and accessories easily. Subsequently these products are to be delivered to consumers through registered Orbea dealers.

Orbea S. Coop. has switched to omni-channel in ten European coun-tries. The company, which is part of the co-operative Mondragon. It owns and runs 261 companies with close to 75,000 employees. Orbea offers it online shopping service currently in Austria, Belgium, France, Germany, Italy, Ireland, the Netherlands, Portugal, UK and Spain.

Orbea has invested heavily in its new site www.orbea.com

Products that are ordered here can only reach consumers via Orbea dealers. Orbea CEO Jon Fernández says on this, “The dealer keeps his regular margin. He handles the delivery of the bike to the consumer including all matters that come with that. And the dealer continues to be the Orbea banner to its customers.”

Short leadtimesFor its switch to omni-channel and with that a stepped-up delivery capability of the online ordered bikes to dealers/ consumers Orbea stopped its production in China. Instead, the company’s assembly ca-pacity at its plant in Portugal were expanded. In April 2015 the bike maker bought a 8,000m² facility that has been equiped for state-of-the art assembly.

In a press release Orbea mentioned that the expansion of its Portu-guese facility is aimed to enhance service speed, flexibility and cus-tomization.In the same press release the Spanish bike maker also said to be in-creasing the customizing potential of its production center in Malla-bia, Spain.

According to Orbea CEO Jon Fernández a by consumers online or-dered customized bike can be delivered to dealers in the ten men-tioned countries within 3 to 4 days.

Source: Bike Europe