USA: Reebok Reports Improved Third Quarter
For the nine month period ended September 30, 2000, net income was $74.7m or $1.30 per share as compared with net income of $25.7m or $0.45 per share for the 1999 comparable period. During the third quarter of 1999, the company recorded a special after-tax charge of $24.3m or $0.43 per share for restructuring activities in the company's global operations.
Net sales as reported in US dollars for the 2000 third quarter were $787.8m as compared with 1999's net sales of $793.9m. However, sales comparisons are being adversely affected by the weakening of the Euro and British Pound Sterling over the past several quarters. On a constant dollar basis, which eliminates the impact of currency fluctuations, sales for the 2000 third quarter increased $21.5m or 2.8 per cent. Worldwide sales for the Reebok Brand in the 2000 third quarter were $645.6m as compared with 1999's third quarter sales of $623.1m in constant dollars, an increase of 3.6 per cent.
In the US, Reebok footwear sales in the quarter were $233.3m, an increase of 4.4 per cent from 1999's third quarter US footwear sales of $223.5m. Reebok apparel sales in the US, including sales of the Greg Norman Collection, were $58.8m for the quarter, as compared with 1999's third quarter sales of $69.9m.
On a constant dollar basis, sales of the Reebok Brand outside the US, including both footwear and apparel, increased 7.2 per cent in the 2000 third quarter to $353.5m, and sales of the company's Rockport subsidiary were $116.2m in the 2000 third quarter as compared to sales of $117m in the third quarter of 1999.
Sales of the company's Ralph Lauren Footwear division were $26m, as compared to sales of $26.2m in the prior year's third quarter.
Paul Fireman, the company's chairman and CEO, said: "The operating performance and future outlook for our Reebok Brand has improved dramatically over the past nine months. The improvement in Reebok's open orders is in most key footwear categories and the growth comes from many of our global strategic retail partners. We are designing innovative products that address market trends and stimulate consumer demand.
"We offer our customers a much needed alternative to what has become an over-saturation in the marketplace of one brand. We continue to make technology more available across the product line and as a result unit sales of DMX product in the US increased 56 per cent in the third quarter."
"Our multiple brand strategy enables us to reach a broader audience of consumers. The improvement in our Rockport business is a result of the successful introduction of many new product offerings. As planned, the quantity of Rockport's new product introductions increased beginning in July, 2000 and as a result sales of new men's products increased 20% in the quarter. By successfully revitalizing our core products and continuing to introduce new products to the market, we expect to be able to grow sales for the Rockport brand in 2001," Fireman continued.
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