Manchester-based sportswear brand Castore has been growing persistently since its launch in 2015. With talks ongoing with lenders over raising a further $200m, Retail Week analyses how it is looking to take on some of the biggest names in sportswear

Phil and Tom Beahon (right) Castore

Castore founders and brothers Phil and Tom Beahon

Founded by brothers Phil and Tom Beahon in Manchester in 2015, Castore has grown quickly to become one of the most recognisable sports brands in the UK. 

Launched as a pureplay brand, Castore has since grown to 11 physical retail stores across the country with a new 1,200 sq ft shop opening in the Trafford Centre, Manchester, this week.

The brand was projected to make a turnover of £200m, with an EBITDA of £20m, this year. In January, the retailer increased its earning guidance for 2023 as it aimed to grow in multiple international markets and become a billion-pound business. 

It has been reported that the company expects to make profits of £30m this financial year.

But who is behind the brand, what has been driving its rapid rise and, with a fresh round of fundraising set to get underway, is it on track to compete with the global giants of sportswear such as Adidas and Nike?

Big-name shareholders

From its early stages, Castore was backed by big investors and shareholders including Asda owners the Issa brothers, Pure Gym founders Peter Roberts and Brian Scurrah, and New Look founder Tom Singh.

Mohsin and Zuber Issa own a sprawling business empire across industries. This includes Euro Garages – with sales exceeding €20bn in 2021 – and majority shares in supermarket chain Asda, Leon and Coopland with over 6,600 sites worldwide.

Roberts and Scurrah founded Pure Gym in 2008. The company went on to be the largest gym operator in the UK from 2008 to 2015 and was sold to US private equity fund Leonard Green & Partners for £600m in 2017.

Singh was the non-executive director of New Look from when it was founded in 1969 to 2019.

Castore stands to benefit tremendously from the networks, industry knowledge and resources its investors bring to the table. This may be in the form of a concession store deal at Asda, knowledge of the sports and gym world from Pure Gym, and the connections and trust that New Look has with its customers.

In 2019, three-times grand slam winner Sir Andy Murray became a shareholder in the brand and made it his official kit partner. 

At the time he said: “Castore is a young, exciting brand that offers something different with products that are really well cut and designed. For me, it was a natural progression from previous kit partners.”

Successful partnerships

Castore store at St James' Park

Castore has struck high-profile partnerships with sports teams like Newcastle United

One of Castore’s most successful brand strategies includes being kit partners to teams across a range of sports to infiltrate the market and increase brand recognition.

The retailer supplies kits to Premier League football teams including Newcastle United and Wolverhampton Wanderers.

With Formula One regaining popularity, the brand has also partnered with McLaren and Red Bull Racing.

Castore plans on expanding its presence in sports such as cricket and rugby and has partnered with Surrey Cricket Club and the Australian rugby league teams Melbourne Storm and Sydney Roosters in Australia as it plans to scale up in other markets outside the UK.

Pippa Stephens, apparel analyst from GlobalData, says: “Castore aims to be the market leader in most sports and though the $200m of funding it is hoping to raise will help towards this, it is unlikely to beat Nike and Adidas in sports like football, basketball and general training apparel.

“However, it has more potential in sports such as rugby and tennis where it is gaining a strong reputation through its ever-expanding list of partnerships.

“It stands a good chance in motorsports too where it is gaining traction against rival Puma, as it won a deal to supply the Oracle Red Bull Formula One team in the 2023 season.”

Fighting competition

On top of its strong financial performance, Castore is valued at £750m following its latest debt refinancing in the autumn and has extended its borrowing facilities with lenders including HSBC and Silicon Valley Bank, allowing it plenty of room to manoeuvre.

At the time, Tom Beahon hinted the brand is open to exploring new forms of investment including private equity, as it plans for global expansion and competes against the likes of Adidas and Nike.

He said: “It’s well documented that there’s been significant interest from institutional investors in sports. So, for Castore, we do have the ambition to be a billion-pound turnover brand. We do have ambitions to be a genuinely global brand.”

Adidas last week warned of losing €1.2bn (£1.06bn) in revenue after ending its partnership with Kanye West. The sportswear giant said it stands to lose €500m (£441.5m) in operating profits this year should it write off its Yeezy inventory and decide not to repurpose it.

Adidas has continued to take a hit on the business after cutting ties with West and expects a “high single-digit declining sales rate”. In 2022, the company reported a net income of €254m (£225m), less than one-fifth of the €1,492m (£1,320m) of its net income in 2021.

With Adidas at its weakest, Castore could benefit from increasing its market share.

Nike is yet to release its third-quarter financial figures but is on track to increase profits after it reported a revenue of $13.3bn and sales of $5.4bn in the second quarter. However, it may be distracted after it entered a legal battle with athleisure specialist Lululemon over patent infringement.

Stephens said: “The funding will allow Castore to introduce new partnerships to boost consumer awareness of the brand and continue to launch in new sports and geographies, helping it to continue growing over the next few years.

”It should also focus on the digital side of its partnerships to capitalise on the international fans of sports teams – including improving its engagement on social media.” 

With its smart marketing strategy focused on close partnerships with sports teams, strong investor support and increased funding, Castore stands to be one of the biggest names in the world of sportswear.

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