Footwear Insight - Business Report Quarterly

points to 51.3% in Q3 due to lower product and freight costs, a more favorable product mix, and reduced discounting offset by negative impact from currency. Key developments: Aiming to become a 'good company' in 2025, company in October projected 10% currency-neutral sales growth in FY24 and approximately €1.2 billion ($1.34b) in operating profit. Relaunching the Superstar in U.S. in 2025. Sales: Brand's 'value proposition' and ongoing global diversification were key contributors to Q3's 16% sales growth to nearly $2.35 billion. Wholesale revenues increased by 21%. Direct-To-Consumer sales jumped 10% and U.S. sales were 15% higher for the period ended Sep. 30 Operating profit: Rose 9.5% to $233.4 million. Gross margin: Contracted 80 basis points to 52.1% due to lower average selling prices. Key developments: With nearly $6.76 billion in total revenues for the first nine months of 2024, company continues to target $10 billion in total sales by 2026. e revenue outlook for FY24 is for a range between $8.925 billion and $8.975 billion. Sales: Swiss brand keeps delivering. Q3 sales, fueled by 50% growth in the Direct-To-Consumer channel, rose by 32% to the equivalent of $756.3 million. Americas' revenues increased by 34.5% to approximately $470.5 million. Footwear sales stepped 32% higher year-over-year to $718.1 million. Operating profit: Improved by 26% in Swiss francs to the equivalent of $86.4 million. Gross margin: Driven by the DTC segment and the company's full-price discipline, Q3 gross margin improved 70 basis points year-over-year to 60.6%. Key developments: U.S. unaided awareness of the brand has doubled over the past 12 months. Sold more than 1 million pairs of shoes in a single Q3 week. FY24 outlook calls for constant currency sales growth of at least 32%. Projecting higher inventory at year-end as it raises on-hand levels of key styles and Spring/ Summer 2025 launches, including the new Cloud 6. Sales: Total Q3 revenues slipped 1.4% to $1,958 million despite a 2.85 increase in comparable sales. Foot Locker North America sales declined by 3.3% to $769 million but comparable sales growth was up 1.6%. Footwear comps increased by high-single digits, fueled by strong gains from Adidas, New Balance, On, Hoka, UGG and Asics. Introduced the Anta brand online and in several doors. Operating profit: Declined by 74% to $12 million from $47 million for the period ended Nov. 2. Gross margin: Fewer markdowns contributed to a 230-basis point improvement to 29.6%. Key developments: Retailer remained committed to a go-forward relationship with Nike, its largest vendor. New Foot Locker Reimagined concept now represents 17% of global square footage and should reach 20% by 2026. Has repositioned its Champs Sports banner to focus on both the active athlete and sports style enthusiasts. Sales: Flat revenues of €2,308.2 million ($2.58b) for the three months ended Sep. 30, but up 5% on a currency adjusted basis. Footwear sales stepped 9% higher to approximately $1.38 billion on growth in soccer and running on the performance side. Direct-To-Consumer sales rose 17% to the equivalent of $647.4 million. Sales in the Americas' region expanded by 11% to €872.2 million ($973.6m). Operating profit: Flat at €237.0 million ($264.6m). Gross margin: Rose by 80 basis points to 47.9% due to improved product and channel mix coupled with lower freight costs. Key developments: Excited about both its Speed Cat shoe in 2025, its low-profile silhouettes, and new brand relationship with ASAP Rocky. Forecasting sales growth of mid-single digits for the FY and an Ebit range of €620-€670 million ($692-748 million). Sales: Declined by 6% to $2.76 billion for the period ended Sep. 30. Americas' sales were down 10% versus a 13% decline in the prior period. Sales for e North Face and Timberland tumbled 3% on a reported basis and were improved, but down 11%, at Vans. Operating profit: Contracted by 22% to $273.9 million from $350.5 million but generated a net profit of $52.2 million footwearinsight.com Q4 January 6, 2025 ~ Footwear Insight Business Report Quarterly 11

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