The new parent of The Athlete’s Foot (TAF), NexCen Brands, wants to grow the American athletic footwear chain to more than 700 doors by the end of next year, including 420 stores outside of the USA. At the end of 2006, TAF will have 390 stores outside of the USA and 245 in its domestic market. There are already 260 potential doors outside of the USA that could be opened within the next three years.
TAF was bought by NexCen earlier this month for $51.5 million in cash and shares, with an earn-out clause of up to $8.5 million if TAF meets certain financial targets. In addition to the planned expansion, NexCen intends to introduce a new store design, develop private label goods to be sold within the chain and establish a new concept called The Athlete’s Foot XB, which will be rolled out in select markets.
For the nine months, ended Sept. 30, TAF reports revenue growth of 3.7 percent to $6.8 million. During the six months ended last June 30, the affiliated retailers raised their sales by 4.7 percent on a same-store basis, with an increase of 8.5 percent for doors outside the USA. Revenues are forecasted to reach $9.6-9.8 million for the 2006 financial year. The franchisees’ sales are expected to be roughly $360 million for the full year, and to total around $400 million in the 2007 financial year. TAF is expected to contribute about $3.8-4 million in incremental net income to NexCen in 2007.