As indicated by the typical company data, the demand for ski equipment has been increasing gradually in the past several years. The increased demand has been driven by positive changes in macro-economy and demographic/housing factors.

Sector’s Current, Trend, Causes behind trend, and Future

Current and Trend

1. It seems that the demand has been stabilized and strong and gradually growing for most of types of equipment of US outdoor recreation& sports.

2. The upward driver for price and the passion of market on new products have been seen in golf, snow sports, and fishing equipment markets. However, we have not seen the same upward trend in shooting& hunting, hiking, or camping equipment market.

3. Growth in demand from international market seems to be stronger than that in domestic market.

4. As demand increased, companies have been able to reduce their promotions and thus increase revenue and improve the margins for most of their product lines.

5. Companies focus on competition on products’ innovation.

6. The data as presented by specialty outdoor sports retailers seems consistent with what we have seen from corresponding manufacturers.

7. The retail performance in traditional stores (sell all categories in equipment, apparels and footwear) seems to have been influenced largely by the whole retail industry climate. While some of category of equipment and footwear perform well, the whole sales of those retailers have been dragged down by generally shrinking demand in some of equipment such as camping, hiking, and hunting and apparels.

Causes behind the trend

1. Generally, the demand for outdoor recreation and related equipment& products has been growing driven by macro-economy and income factors as described above and by increasing realization of outdoor sports among young and women.

2. The increased demand may be more likely from existing sport fans than from new fans as they would like to pay more for new, innovative equipment, which help speed up product updating and result in growth in revenue. At the same time, those consumers may prefer to go to specialty stores for their equipment.

3. However, sales of outdoor related goods and equipment have also been, to less extent, influenced by the whole retail climate as seen by slowing down traffic in traditional sport stores, which may be attributable to the decrease in revenue in hiking, camping, and sportswear.

4. For some of recreation sport such as sport shooting, political and public factor play a more important role in influencing consumers’ shift.

Industry Future

1. As upward trend in this industry continues, companies may be able to continue to see growth in their revenue as macro economy recovers gradually. However, some of categories that depend on traditional sports stores channels may find their performance in revenue will be limited by those stores’ ability to attract traffic.

General Financial Performance of Companies In the Sector

It seems that the demand for climb, mountain, and ski equipment has been stabilized and growing since 2016 as indicated by increased sales volume of those products for related companies in this sector. However, the general demand from US domestic market for ski products seems not to be as strong as international market and the performance of climb and mountain products seems to be better than ski products.

Impact from foreign currency on profit of companies seems to be significant due to increasing contribution to sales growth from international market. A typical gross margin (including direct operating costs and depreciation) was 32.5%, the SG&A as percentage of sales was about 33%, and the operating margin was about -1% in the past year. And EBI/sales was about -0.9% in 2018.

The typical enterprise price/sales ratio is 1.3.

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