News

Athlete’s Foot gains momentum

Athlete__s_Foot_Merrell_w250The parent company of sports footwear chain Athlete’s Foot is looking forward to a period of expansion following an acquisition spree and strong annual results.

RCG Corporation has purchased the Australian distribution rights to outdoor and active brand Merrell under an agreement with Merrell parent Wolverine World Wide, which will take effect from January 1, 2010.

RCG chairman Ivan Hammerschlag said the Merrell business was expected to turn over in excess of $12 million in its first year of operation, and would potentially deliver earnings before interest and tax contribution in excess of 20 per cent.

Meanwhile the acquisition of Shoe Superstore would complement, rather than compete with, the 136-store Athlete’s Foot chain.

RCG reported net profits of $5.3million for the year ended June 28, a 7.4 per cent rise compared with the previous year.

While revenue fell 7.1 per cent to $21.997m from $23.666m last year, the company’s profit grew on the back of the “exceptional sales performance” of the Athlete’s Foot network, which recorded total sales growth of 15 per cent to $166.7million, and like-for-like stores sales growth of 11 per cent.

Hammerschlag said the outlook for the business was hopeful despite economic uncertainty, attributing the company’s solid performance to its strong customer service model.

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