On May 4, Standard & Poor's announced it had put fitness manufacturer Icon Health and Fitness on notice, and it might downgrade its credit rating if the company doesn’t do better financially.
Icon’s VP of marketing, Colleen Logan, called the notice a "non-story."
“Nothing has happened,” Logan said. “They haven’t done anything yet.”
SNEWS reported that S&P placed a "B+ Watch Negative" corporate credit rating on CreditWatch for the Logan, Utah-based company, something Logan said doesn’t mean much.
“It doesn’t mean anything for the company,” Logan said, emphasizing that Icon is on an unusual fiscal calendar, which ends on May 31. S&P had said in a statement the B+ Watch Negative listing was due to deterioration of Icon’s free operating cash flow though the first nine months of its fiscal year.
Logan said that was mostly due to an unusually warm winter, which also hurt the snowsports industries.
“Record-setting heat is really a boon to some people in the overall fitness and outdoor industries, and it’s a bane to others,” Logan explained. “The record-setting heat made it easier for people who exercise to do so outside. People enjoy using our products inside when the weather is bad.”
While Logan wouldn’t speculate as to whether the company could get off the watch list, she did say it’s business as usual for Icon, and that sales are looking good in a few areas, including trail-running and on the new, soon-to-hit stores Boston Marathon treadmill.
According to the Sporting Goods and Manufacturers Association quarterly report, consumers are planning to spend more on footwear and fitness apparel in the coming six months — good news for Icon, since the company owns both Altra Footwear and FreeMotion Fitness apparel, Logan said.
Plus, Logan said there are a couple of partnerships in the works that she’s not at liberty to discuss. She did, however, express excitement at the company’s new treadmill, a partnership between with the Boston Marathon.
The interactive treadmill features a high-definition video of the course so runners will be able to feel like they’re running the actual Boston Marathon course.
Logan said this product is similar to its Tour de France cycle.
“We shot HD video the day of the race course from the lead car,” Logan said. “It’s kind of fun because even if you’re the No. 1 person in the race, you’re always behind the lead car. This way you’re really in first place.”
For now, Logan isn’t worrying.
“Neither S&P nor Moody’s has taken any action,” Logan explained, “they’re just looking carefully at our numbers the way they do all corporate bonds.”