- Wolverine Worldwide on Wednesday announced a number of changes to its Sweaty Betty brand — intended to drive long-term growth at the company. The brand will now report to Wolverine Worldwide’s London-based International Group, which oversees the company’s operations outside of the U.S.
- In an effort to better align Sweaty Betty’s cost structure with Wolverine’s other brands, the company is proposing a U.K. workforce reduction, consolidating its London office space and “securing savings through Wolverine’s new Profit Improvement Office,” according to a company press release.
- Julia Straus, Sweaty Betty’s CEO, will be leaving the company in June in order to be closer to her family in the U.S. A search for a successor is underway.
The changes to Sweaty Betty’s structure, including job cuts and a reorganization, come just over a year and a half after Wolverine Worldwide acquired the activewear brand for $410 million. The acquisition was made to help Wolverine expand its DTC strategy.
Moving Sweaty Betty under Wolverine’s International Group is in part to more closely align the brand with Wolverine’s global centers of excellence, the company said Wednesday.
“Bringing Sweaty Betty under Isabel Soriano and the International Group fits perfectly with our strategy to prioritize resources and support to the brands with the biggest global growth opportunities,” Brendan Hoffman, Wolverine Worldwide’s president and chief executive officer, said in a statement. “Our regional teams have deep commercial experience in key international markets and are well-positioned to bring their sourcing, logistics, technology, and operational expertise to help accelerate Sweaty Betty’s growth.”
Wolverine’s portfolio of brands also includes Merrell, Saucony, Sperry, Chaco and others. Up until last month, Keds was also among those brands until it was sold to DSW parent Designer Brands, which is also now licensing the Hush Puppies footwear brand. At the same time, the company said it was considering what it will do with the Wolverine Leathers business as it prioritizes growth and providing long-term shareholder value.
Wolverine Worldwide in December also announced it laid off an undisclosed number of employees, which the company anticipates will result in $30 million in savings this year. The company last month reported that overall fourth quarter net revenue increased 4.6% year over year to $665 million. By brand, Merrell sales increased 27% year over year; Saucony increased 24.8%; and Wolverine increased 9.6%. However, sales were dragged down by a 28% decline at Sperry and a 7% decline at Sweaty Betty. Wolverine Worldwide’s operating loss widened to $454.7 million during the quarter and its net loss grew to $360.8 million.
For the year ahead, the company expects revenue to be flat to up 2% year over year, reaching $2.53 billion to $2.58 billion. Gross margin is expected to be 41.2% and operating margin is expected to be 8.7%.