Easton-Bell is going on with the reorganization of its management following the recent return of Terry Lee as executive chairman and chief executive. Mike Zlaket, who worked for the company for 22 years until 2011, returns as president of Easton Sports, replacing the departing Chris Zimmermann. Among other moves, Mark Kuryak replaces Craig Ryan as executive vice president in charge of global hockey sales. He joins Easton after working on sales for Ogio and Rawlings Sporting Goods over the past five years.
Meanwhile, Easton-Bell reported a decline of 11.4 percent in net sales for the fourth quarter ended last Dec. 29, down to $183.5 million. Team sports sales fell by 9.6 percent and action sports sales dropped by 13.9 percent. The company blamed the depressed global snow market, which affected Giro's sales, and the timing of cycling product releases in the mass market as well as the group's decision to exit the non-core fitness business. Partially offsetting these factors, Giro's cycling products experienced double-digit growth and Bell benefitted from an expanded range and global distribution for its powersports helmets.
The gross margin went down by 3.5 percentage points to 31.7 percent in the quarter, and the adjusted operating earnings before amortization (Ebitda) fell by $17.0 million, or 68.5 percent. For the full financial year, adjusted Ebitda declined by only 15.5 percent to $80 million on 0.9 percent lower sales of $827.2 million. The final result was a net loss of $3.4 million compared with a profit of $10.0 million in the previous year.
The company noted that the recent management changes and the costs associated with its exit from certain categories will impact the results for the first quarter of 2013 by about $8.0 million and $2.5 million, respectively.
