For those who play, there's Sport Chalet. The sporting goods retailer operates 50-plus stores mostly in California, but also in Arizona, Nevada, and Utah. It also sells its goods through its online shopping site. The stores, which average about 41,000 sq. ft., are known for carrying specialty products, such as mountain climbing and SCUBA gear. Sport Chalet has traditionally specialized in gear for cold-weather sports, such as skiing and snowboarding, but its stores sell brand-name footwear, apparel, and equipment for many other activities, too. Shoppers at Sport Chalet can sign up for SCUBA training and join dive clubs associated with the stores. Sport Chalet was founded in 1959 by the late Norbert Olberz.
In addition to its retail stores, Sport Chalet operates a Team Sales Division in Van Nuys, California that provides uniforms, footwear, and equipment to universities, high schools, athletic teams, youth sports leagues, clubs and other recreational organizations.
Sport Chalet is still struggling to get back in the game after getting pummeled by the recent deep recession in the US, which hit its two largest markets -- Arizona and California -- especially hard. The sporting goods retailer has posted negative annual sales comparisons in three of the past four years and has failed to turn a profit in five years. After a modest 2.5% uptick in sales in fiscal 2011 (ends March), sales declined again by about 3.5% in fiscal 2012. Same-store sales (generally considered the best indicator of a retailer's health) decreased for the fifth consecutive year. Indeed, the nearly $350 million the company rang up in 2012 was well below its pre-recession high of more than $400 million. The company blamed its poor results on an extra week in fiscal 2011 and the closing of one of its stores. Its Action Pass program, which reduces sales as points are earned, and warm and dry weather during ski season also negatively impacted sales of winter related merchandise. On the plus side, online sales grew by 22% in 2012.
In response to the weak business climate, traditionally fast-growing Sport Chalet put plans for expansion on hold and closed one store in fiscal 2012. While no new stores are planned for fiscal 2013, one new location in Southern California is expected to open in early fiscal 2014. Sport Chalet has identified underperforming markets where it has stores and is attempting to renegotiate those leases or close unprofitable locations. When its business began heading south, the chain took aggressive measures to improve liquidity and cut operating expenses by renegotiating loans and lease terms, reducing inventory, and cutting jobs, among other measures. While it's been a tough couple of years for Sport Chalet, it's been worse for some of its competitors, including Sierra Snowboard, Chick's Sporting Goods, and Sportsman's Warehouse -- all of which have closed stores.
The family of founder Olberz owns about 62% of Sport Chalet's common stock and control 20% of the voting power. Also, Chairman and CEO Craig Levra and CFO Howard Kaminsky control about 33% and 12% of the voting stock, respectively. Norbert Olberz died in 2011. – less