Fox Company sales to drop 9% in 2023
Revenue from Fox's Professional Sports Group, which includes bicycle-related brands, fell 43% in the company's fiscal 2023, a decline the company attributed to "channel inventory rebalancing" and "lower consumer demand for lower-end products." ". SSG's revenue fell despite $16.8 million in net sales from Marucci, which was acquired by Fox last November.
Companywide, Fox sales fell 8.6% to $1.46 billion, driven by sales growth at Fox Powered Automotive Group and Aftermarket Applications Group. SSG sales this year were $389.2 million, down from $681 last year.
Fox CEO Mike Dennison said: "After the first half of the year, the company's sales began to deteriorate. Obviously, 2023 is a story of two first halves. The first half generally went as planned, and the second half , particularly after Labor Day, SSG destocked as it relates to cycling and other macro headwinds. While the second half of 2023 will be challenging, I'm pleased that we have maintained a disciplined focus on innovation across the business."
Fox forecasts net sales in fiscal 2024 to be between $1.53 billion and $1.68 billion. The company said its "product roadmap" supports its long-term goal of achieving $2 billion in sales in fiscal 2025, but warned that achieving that goal depends on factors beyond its control.
The company said: "Our vision of $2 billion in sales and 25% adjusted EBITDA margin will depend on several factors, including uncertainty about volume, product mix (as we are primarily tied to OEMs), larger the macro environment (including interest rates) and our exit rate in the fourth quarter of this year."
Fox's bicycle-related brands include Fox suspension, Easton cycling, RaceFace and Marzocchi. In addition, Marucci is primarily a baseball and softball brand and is the parent company of Lizard Skins, which produces bicycle grips, handlebar tape and gloves, as well as grip tape for racquets and other sports products.
Halfords share price plunges 25%
Halfords, the UK's largest retailer of bicycle products and services, announced that its profit forecast has been cut by at least 17% due to a slow start to the year, and the company's share price plummeted in response.
Halfords shares have fallen to 140p this morning, down more than 25% from its closing price of 200p and hitting their lowest level since October 2022. The market reacted to Halfords' revelation that its January sales were disappointing, with bicycle-related sales down 8% on the same month last year. Elsewhere, car sales fell 5% and tire sales fell 4%.
The company reported in its latest quarterly accounts published last month that performance in its bike segment was "significantly below expectations", a trend that looks set to continue into 2024.
Now Halfords is blaming the bad weather for its business, with rain and warmer temperatures meaning less footfall in stores and fewer antifreeze sales.
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