Listed group begins to make good
SYDNEY: Listed group Beyond Sportswear International's (BSI) attempt to stabilise its financial dealings has received a profitable shot in the arm after the company was awarded two lucrative new contracts.
The Melbourne headquartered retail and merchandising business, which formerly traded as Concept Sports, has been named as the official merchandise partner and uniform supplier to the 2009 World Masters Games. The win involved BSI outfitting more than 7000 volunteers and officials as well as provide an extensive merchandise program for the expected 30,000 competitors.
The win comes on the back of the brand being named as the official merchandise supplier to a new Superleague Formula One racing event to be staged in Europe later next month.
The news appears to signal the end of a turbulent couple of years for BSI which in 2006 faced a multimillion dollar class action brought by shareholders over what they claimed was the company's misleading and deceptive conduct while trading under its former name. The case was based on profit forecasts made at the time of the company's float in 2004 after which it subsequently posted a $2 million loss and the value of its shares dived 70 per cent.
The case, brought by Melbourne law firm Maurice Blackburn, was settled out of court in October 2006.
Concept Sports, which ran the official merchandise outlets for the Sydney and Athens Olympics as well as the Melbourne Grand Prix, was originally established in 2002 on the back of what CEO Glen Casey described as a "very successful" Sydney Olympics followed by a "very unsuccessful" Athens Olympics.
The business was restructured in 2007, during which time it changed its name to BSI, and since the group has made several attempts to return to profitability through the acquisition of several "more stable recurring revenue businesses" including the Kea and Kombat Sportswear groups.
In March BSI announced it had entered an agreement with Gold Coast-based apparel group GJK Australia to purchase the business assets of the company for $400,000. Earlier this month the group purchased Sunshine Coast business Frontrow Rugbywear, representing its fifth acquisition over the past 12 months.
Casey said there were significant synergies which were expected from the acquisition as product would be able to be manufactured and distributed from BSI's existing facilities.
He said the acquisition provided further momentum to its focus on the growing markets of education and "grass roots" sporting clubs. "Frontrow Rugbywear was purchased to expand a growing market specifically in knitted rugby jumpers to schools. The owner Michael Spring will stay on and all other activities will be handled by our existing set up," Casey said.
The group has provided financial year 2008 guidance of operating EBIT of $2.6 million - representing a 160 per cent increase on the previous year. Casey said it was hoped the latest acquisition would increase next year's earnings by at least 10 per cent.
By Tracey Porter