Precor, Woodinville, Washington, reported net sales of EUR74.4 million ($84.1 million) in the first quarter, according to financials released Friday by parent company Amer Sports, Helsinki, Finland.
The EUR74.4 million is a six percent increase over the first quarter of 2015 (EUR69.9 million) and marked the fifth consecutive first quarter of growth for the company. Amer Sports said its fitness segment is "starting to re-ignite growth" due to strengthened distribution supported by product launches.
Amer Sports attributed first quarter fitness segment results to the completion of go-to-market integration and improved capabilities, and a strong pipeline of initiatives kicking in, according to the release.
Amer Sports' overall net sales in the first quarter increased 11 percent over 2015 to EUR635.5 million ($718.2 million). The company expects net sales in local currencies to increase in 2016, according to its outlook.
"We started 2016 with solid profitable growth as we continued to successfully accelerate especially in our five priority areas: apparel and footwear, United States, China, business to consumer, and digital," Heikki Takala, president and CEO, Amer Sports, said in a statement. "Gross margin was very healthy, supported by clean inventory and pricing ahead of currency related pressures. The improved gross margin enabled us to invest back into acceleration especially in Digital and Business to Consumer. Our growth was further boosted by the 2015 acquisitions of Louisville Slugger and Queenax."
Further details on business performance of Precor's Queenax and Spinner lines were not disclosed in the media release.
In February's financial disclosure, Takala said the Queenax business was "very healthy" and said the Spinner bike production was "starting to contribute." Precor and Madd Dogg Athletics entered into a worldwide distribution agreement in 2015 for Precor to assume all Spinner commercial production.
Precor's net sales grew in the Asia-Pacific and Americas regions in the first quarter but fell slightly in the Europe, Middle East and Africa region (EMEA). In the first quarter, American sales increased four percent in local currencies over 2015 to EUR47.8 million ($54 million), Asia-Pacific sales increased 29 percent in local currencies over 2015 to EUR12.1 million ($13.7 million), and EMEA sales declined 2 percent in local currencies over 2015 to EUR14.5 million ($16.4 million).
There were 952 employees in the fitness segment as of March 31, marking a 23 employee drop since Dec. 31, 2015, and a three employee drop from March 31, 2015.
In February, Precor reported 2015 net sales fell 3 percent in local currencies to EUR357.3 million ($389.7 million) despite year-over-year growth in the fourth quarter and in international sales. Precor's sales in the fourth quarter of 2015 were EUR116.1 million ($126.7 million), marking a four percent growth over the fourth quarter of 2014.
At the time, Takala noted fitness and cycling segments were slightly down due to "business model renewal and restructuring." Amer Sports acquired ENVE Composites LLC, Ogden, Utah, a manufacturer of high-end carbon wheels, components and accessories for road and mountain biking, in a $50 million transaction that closed on March 8. ENVE Composites has annual sales of approximately $30 million and will be part of Amer Sports' cycling segment. The acquisition had no material impact on Amer Sports first quarter results.
Editor's note: Euro to U.S. dollar conversions for the first quarter are based on the April 22 exchange rate. All other conversions were calculated on previous exchange rates.