Glasses on the run Newsletter #42
Hi,
I hope you are all well and I hope you enjoy this short selection of stories from the business of running.
What was interesting in the business of running
There are two main topics this time - some of the first financial reports for 2024 and money in professional running.
Companies financial performance reporting.
Adidas released preliminary results for its fiscal 2023 year. Overall sales fell 5% from the 2022 level, but Adidas had a stronger than expected fourth quarter. It cites currency fluctuations, the devaluation of the Argentine Peso, and the discontinuation of the Yeezy business as negative factors. But despite all of them, it finished the year with an operating profit of € 268 million out of € 21.43 billion of sales, while it had previously expected an operating loss of € 100 million. Here is the official Adidas statement as well as coverage by Reuters and the BBC.
Puma also released its preliminary 2023 fiscal year results. Unlike Adidas, Puma grew its sales in 2023 - by 6.6% as compared to 2022 to € 8.60 billion. It did however face similar challenges to the ones faced by Adidas - more specifically the devaluation of the Argentine Peso. (Reuters)
Deckers - the parent company of Hoka - also shared its financial results, albeit for its third fiscal quarter rather than the full year ones. Its impressive growth continues - this time 16% as compared to the same period the previous year. Hoka's amazing performance continues to be a main driver (alongside UGG) for the company. Hoka recorded 21.9 percent growth to $429.3 million with its direct-to-consumer channel growing 50%. (SGB Online)
Salomon owner Amer Sports went ahead with its IPO. It was aiming for a price per share between $16 and $18, but ultimately couldn't meet that range and went public at a price of $13 per share, raising $1.6 billion at a $6.3 billion valuation. The Finnish Amer Sports was previously acquired by the Chinese Anta Sports for $5.2 billion in 2019. (Hyperbeast)
Money in professional running.
I Run Far conducted a very interesting thought experiment of how much it costs to be a competitive trail runner. As always in these estimates, the logic and the thinking behind them is as useful as the actual numbers (I Run Far). It is an interesting topic because prize money in trail running have been growing, for example the Run Rabbit Run race, which is a popular 100 (& 50) miles race, offers $15,000 for both the male and the female winners of the 100-mile distance.
At the same time, as a comparison, most of the six marathon majors offer $100,000 prize for the winners, with the Boston marathon offering $150,000 (RunRepeat). In 2023 Kelvin Kiptum, who is the current world record holder, was the only winner of two marathon majors in the men races. Both Sifan Hassan and Hellen Obiri won two each in the women marathon majors races. Of course, professional athletes at this level have sponsorship deals too, but in terms of races and race prize money, that's pretty much the ceiling as it would be rare for an athlete of this caliber to participate in more that two marathon races per year.
One more (and final) comparison, four out of the top 10 earners on the 2023 Forbes list of highest-earning athletes have had on-the-field earnings of $100 million or more for the year. That's a whopping 500x the prize money for winning two marathon majors... Food for thought.
As always, thank you for reading,
Momchil
