The big Portuguese shoe retailer opened its 32nd Spanish store in a new shopping mall in Coruña yesterday. It's one out of about 20 new SportZone stores that are going to be opened all over Spain this year. SportZone is also re-evaluating a former project to enter the Turkish sporting goods market.
As Portugal is a relatively small market, with a relatively fragile economy, the chain's parent company, Sonae Group, has defined international expansion as its main strategic priority. It is opening new shopping centers abroad and widening the international reach of its supermarkets, hypermarkets and specialty stores. It opened a total of 46 new stores in Spain last year under the SportZone, Worten and Zippy banners, to be followed by at least 60 new openings in 2011.
With a total of 89 stores at the end of last year, not including 21 joint ventures and franchises in various countries, Sonae's foreign specialty retail turnover grew by 59.8 percent to €231 million in 2010, representing about 20 percent of total specialty retail sales. While their Ebitda margin remained negative at 11.9 percent, this was better than before.
SportZone's total sales increased by 11.3 percent to €228 million in 2010. The group's total specialty retail revenues increased by 12.3 percent to €1,272 million – faster than other operations of the Sonae group. On a comparable store basis, sales rose by 1 percent in Portugal as well as in Spain.
While the number of SportZone stores in Spain doubled to 28 last year, with a sales surface of 33,000 m², the number of SportZone stores in Portugal declined from 75 to 74 due to the shutdown of two unprofitable units, but their total retail surface in the country remained stable at 61,000 m².
Despite its international ambitions, SportZone is not giving up the fight for market shares in its home country, where Décathlon is becoming a more important competitor and Sports Direct International has bought the Megasport chain. SportZone opened its 76th Portuguese store earlier this week in a new shopping center in Sintra.
The chain also launched its biggest direct mailing campaign so far in both Spain and Portugal, sending more than 1.5 million fliers with special discount vouchers to the customers who have signed up for a loyalty scheme that it stated one year ago. Two-thirds of them were distributed in Portugal.
The Sonae group reported a 4.4 percent increase in total sales to €5,914 million for last year. Operating earnings before amortization (Ebitda) grew by 9 percent and reached a margin of 12.3 percent. Net income jumped by 171 percent to €199 million.
