sportstyle

JD Sports Leadership: CEO Régis Schultz Founded in 1981, Based in Manchester, England. Presence in 49 countries with 4,850 stores. 1,652 doors in North America, including 73 JD banners, and 569 locations in the European Union. North American banners: JD Sports (305), Finish Line (257), Hibbett Sports (1,000), City G.E.A.R. (200), Shoe Palace (200), and DTLR (250) Annual Sales: £11.5 billion ($15.6 billion) for 12 months ended Feb. 1, 2025. Footwear revenues stepped up 15.2% last year to £6,819 million ($9.27 billion), and apparel sales increased by 4.2% to £3,550 million ($4.82 billion). Dick's Sporting Goods Leadership: Edward W. Stack, Executive Chairman; Lauren R. Hobart, President & CEO Founded in 1948, Based in Coraopolis, PA Presence in U.S., Europe, and Asia aer the merger with Foot Locker with 3,490 stores. 856 Dick's and 2,410 Foot Locker doors across 20 countries and 224 licensed Foot Locker stores in the EU, Middle East, and Asia. North American banners: Dick's, Foot Locker, Champs Sports, Kids Foot Locker, WSS, Atmos, Dick's House of Sport, Golf Galaxy, Gamechanger, and Going, Going, Gone. Annual Sales: $13.6 billion (2024), up 1% y-o-y. Footwear revenues rose 13% to $3,829 million, and annual apparel sales increased by 2.2% to $4,425.4 million. Foot Locker's FY24 total revenues fell by 2.2% y-o-y to $7,971 million. Operating income: Dick's: $1,154.3 million, up 2% y-oy; Foot Locker's FY24 operating income declined by 27.5% to $103 million. POWER PLAYERS different categories, price tiers, and usage occasions. But there are notable concerns and risks. Most notably, "execution risk," as pointed out by more than one analyst. e complexity of integrating two large retail businesses with different operational models is a major concern that will undoubtedly take time to complete. "ere can be problems bringing together disparate systems, cultures, and operations in retail mergers," UBS analysts recently pointed out, adding, "Retail integrations tend to be challenging with a far longer list of retail mergers that were not successful than those that were." Peel Hunt analysts have suggested the Dick's-Foot Locker merger could benefit JD given the execution risk, further suggesting that while Dick's is overseeing a consolidation of operations, its rival could capitalize on the situation and gain market share in both the U.S. and U.K. Out of the gate, Dick's senior management will be charged with helping Foot Locker reverse its recent struggles that have prompted soer sales and low operating margins. e retailer's proponents see it as a "highly capable and efficient operator" that can effectively utilize its customer data and omnichannel capabilities to improve Foot Locker's operational efficiencies and sell- through rates. In Foot Locker, Dick's will obtain access to new customer demographics, largely urban and international markets, that present customer bases it currently does not reach. JD CEO Régis Schultz initially called Dick's acquisition of Foot Locker "a positive" for the market and expressed confidence in the British company's growth strategy through differentiation and customer engagement. Over the last two years, key developments at JD have included adding 405 profitable stores, acquiring both Hibbett and France-based retailer Courir, divesting 30 non-core businesses, developing a franchise model, and enhancing its omnichannel capabilities and profitability. Running and retro basketball dominate JD's footwear business, which has grown at a compound annual growth rate of 9 percent over its last five fiscal years. Sales of athletic shoes, which represent more than 40 percent of its footwear business, grew 17 percent in 2024 and fueled a 5 percent gain in sports apparel sales. Meanwhile, JD's apparel segment, where core sport and outdoor garb are the majority, has grown sales at a 12 percent compound annual growth rate since FY20. Nonetheless, recent analyst ratings on publicly traded JD Sports ranged from "Buy" and "Hold" to "Sell" with some seeing the stock as undervalued and poised for growth, and others expressing concern about potential headwinds and impacts from supply chain constraints. e company's long-term prospects are solid, according to Shore Capital analyst David Hughes due to its strong balance sheet and cash generation. As for Dick's-Foot Locker, most market analysts appear to see the marriage as a long-term play rather than one that will yield immediate returns. e deal's ultimate success will rely heavily on Dick's ability to effectively integrate Foot Locker and stimulate its business. Let the Battle of the Titans begin. n RETAIL 6 • July/August 2025 sportstyle • sportstylemag.com

• Cover