Like Puma and Champion, Fila continues to grow faster than much bigger sports brands like Nike, Adidas and Under Armour. The Italian heritage sports brand’s momentum remained particularly strong in Europe during the third quarter of 2019, as Fila Korea’s licensing royalties from the region surged by 59.3 percent to 11,919 million Korean won (€9.2m-$10.1m).
Fila Korea has been the owner of the brand since 2007, and it has been licensing it out in key regions such as Europe, where it has been working through Ochsner Sport. Globally, Fila Korea reported a 31.9 percent increase in licensing fees to KRW 18,926 million (€14.6m-$16.1m), as well as a 52.7 percent increase to KRW 6,972 million (€5.4m-$5.9m) in design fees from its 10-year-old joint venture with Anta Sports Products in China.
The revenues of the company’s North American subsidiary, Fila USA, jumped by 33.4 percent to $140.7 million in the region, leading to gain of 6.7 percent in local net earnings to $6.8 million, despite a drop of 1.9 percentage points in the operating margin to 30.5 percent.
In South Korea, the operating margin grew by 6.5 percentage points to 17.7 percent, but the brand’s sales in the country went up at a more moderate pace of 12.2 percent to KRW 149.8 million (€120,000-$130,000), probably reflecting the depressed economic situation in the country. Still, the net profit in Korea soared by 93.1 percent to KRW 35.6 million (€27,400-$30,000).
Overall, Fila’s operations saw a jump in revenues of 19.4 percent to KRW 866,986 million (€688.4m-$737.1m). The gross margin declined by 0.6 percentage points to 48.1 percent, but the operating margin rose by 4.2 percentage points to 14.4 percent, and net earnings rocketed by 117.3 percent to KRW 98,450 million (€75.9m-$83.7m). The company’s results include the sharply improved results of Acushnet in the quarter (see the separate story in this issue).
