A new subsidiary of Heelys, Heeling Sports France, is going to take over distribution of Heelys shoes in France, Monaco and Andorra from a distributor, Trotwood Import/Export. Based in Annecy, France, the new subsidiary will be run by a sporting goods industry veteran, Serge Darcy, who has worked in leading positions for such companies as New Balance, NBA Europe, Salomon and Compex.
The new company is a branch of the recently formed Heeling Sports EMEA, which is also run by a former New Balance executive, John O’Neal. It will take advantage of a new EMEA warehouse operated by DSV in Ghent, Belgium, since last year. Trotwood, which has distributed Heelys since 2003, will remain as a consultant for one year.
Also, three months after the resignation of its former chief executive, Heelys has announced that Michael Hessong, its chief financial officer, has resigned "to pursue other interests." The company is searching for his successor.
Meanwhile, Heelys reported a $1.0 million loss for the first quarter ended March 31, compared with a net profit of $8.5 million a year ago. Net sales were down by 73.5 percent to $13.1 million, and the gross profit plunged as well, dropping by 84 percent to $2.8 million. The gross profit margin was 21.5 percent, down from 35.4 percent for the same period in 2007.
The company said that much of the problem was overstocking, and that it was focusing on adjusting inventory as well as expanding in Europe and taking over its own distribution in selected markets.
