Footwear Insight - Business Report Quarterly

Sales: -2.0% on a currency-neutral basis in Q4 to approximately $5.24 billion. North American sales fell 21% in euros to the equivalent of $1.26 billion. FY23 total revenues dropped 16% in euros in North America to approximately $5.68 billion and were down 4.8% worldwide at $23.3 billion. Operating profit: Operating loss improved by 48% in euros to the equivalent of $410.4 million in Q4. Annual operating profit decreased by 60 percent in euros to the equivalent of $291.8 million. Gross margin: +550 basis points to 44.6% in Q4; +20 basis points to 47.5% for FY23. Key developments: Projecting a 5% decline in North American sales in FY24, an improvement from FY23. Overall business should grow at least 10% in H2 and by mid-single digits for the year. Growing demand for suede "terrace" classics such as the Samba and Gazelle should bolster sales growth. Sales: +17.7% for the FY ended Dec. 31, 2023, to ¥570,463 million ($3.79 billion). Global performance running sales rose 10.7% to ¥285,929 million ($1.9 billion). North American annual sales increased 8.8% to ¥135,849 million ($902.4 million). Operating Profit: +59.4% to ¥54,215 million ($360.1 million). Gross Margin: +230 basis points to 52.0% from 49.7% in FY22. Key developments: Initial FY24 outlook calls for a 7.0% increase in operating income to ¥58.0 million ($385.3m) and 3.4% revenue growth to ¥590 million ($3.92 billion). But North American revenues are forecast to fall by 3% to approximately ¥111.0 million ($737.3 million). Global performance running sales are expected to rise by 5 percent to about ¥300 million ($2.0 billion). Sales: Privately held subsidiary of Berkshire Hathaway reported a 5% increase in year over year revenues in 2023 to $1.2 billion from more than 20 million units sold. Annual North American revenues rose 7% to hit $1 billion for the first time. Operating profit: Did not disclose. Gross margin: No details. Key developments: Brooks realized 24% global revenue growth in Dec. 2023. e Ghost Max, introduced in Sep. 2023, sold more than 500,000 pairs in first three months, and contributed to the brand's 2-3% footwear retail market share gain between Sep. and Nov. 2023. Dan Sheridan will become Brooks' next CEO on April 26, replacing Jim Weber, who will step down aer 23 years in the position. I n each issue of Footwear Insight Business Review Quarterly, in addition to the Brand Index and Retail Index, which track the most important publicly traded companies with a substantial footwear business, we will also take a deeper look at a dozen companies from those two FI-BRQ Indexes to provide their latest financials and key developments. In this inaugural Scorecard, there are details about how these publicly traded companies performed in both Q4 and for all of 2023. While we can not provide this information for every entrant on our indexes, we intend to rotate different firms from the Indexes into the Scorecard in every issue. And of course, not all footwear news in Q1 was made by public companies. Privately held New Balance revealed that its global 2023 sales rose 23 percent to reach $6.5 billion, and Amer Sports, parent of the Salomon brand, raised more than $1.36 billion in a NYSE IPO in February. 10 Footwear Insight Business Report Quarterly ~ Q1 April 8 2024 footwearinsight.com QUARTER 1 ENDING 3/25/24 BRAND & RETAIL SCORECARD Q1

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