Cline's Diving Industry Survey Results, Q4 2009

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Cline's Diving Industry Survey Results

Fourth Quarter 2009 Dive Business Survey

Similar to the 2nd Quarter 2009 results, there are signs of a small rebound for retailers when asked to forecast their 1st quarter 2010 gross revenues.

> Overall, retailers responded as follows for an INCREASE in their 1st quarter outlook for gross revenues:

Eastern US: +31%
Central US: +21%
Mountain US: +33%
Pacific US: +33%

As shown, retailers everywhere are optimistic about their 1st quarter '10 Gross revenues increasing.

> Independent Instructors posted a drop in certification numbers posting a -5.1% loss in the 4th quarter of 2009. However, unlike retailers, they are projecting a drop in their 1st quarter '10 certification numbers.

Summary:

> Internationally, businesses by region responded as follows for an projected INCREASE in their 1st quarter '10 gross revenues:

Carib/S. America: +44%
All Other Regions: +33%
USA: +29%
Canada: +27%

> When looking at a combined response for travel sector (resorts, wholesalers & liveaboards), the average company posted a 6.6% gain in their 4th quarter 2009 gross revenues as compared to the same period in 2008.
Their outlook is very optimistic as almost 50% expect to see a gain in their expected revenues in the 1st quarter of 2010.

Cline's fourth quarter 2009 Dive Industry Survey is in and a total of 243 dive businesses responded to this survey and indicated the following results:

All dive businesses saw, on average, a -1.5% decrease in their gross revenues for the 4th quarter 2009 versus the same period in 2008.

Retailers specifically were down, reporting a -7.0% decrease in their overall gross revenues in the 4th quarter of this year.

New certifications were also down as retailers posted an average decline of -7.3%. Independent instructors also posted a -5.1% decrease in certifications.

Dive travel sales were down -11.9% specifically for retailers.

Dive equipment sales were also off, as retailers posted a -7.3% decline in sales.

88.9% of the retailer respondents were from the USA.

97.6% of the retailer respondents were the facility owner or manager.

Each business category responded as follows for their Gross Income change in the 4th quarter 2009 versus the same period in 2008: (for categories over 10 respondents):

Gross Revenues Table
Business Classification; 4th Q '10 % Change; Number Reporting and % of Whole

Dive Retailers
-7.0%
126
51.9%

Independent Dive Instructors
(# certs)
-4.3%
47
19.3%

Dive Resort or Resort-Based Dive
Operators
-6.9%
13
5.4%

Dive Wholesaler/Agent or US
Booking Office
n/a
8
3.3%

Dive Related Manufacturers 13.3%
13 5.4%
Dive Liveaboard Boat or Charter
Boat n/a
6 2.5%

Dive Related Media, Publication,
Website
n/a
6
2.5%

Dive Training Agency n/a
4
1.7%
All Other Industry Professionals 4.5% 20 8.2%
All Averaged/Total Respondents
-1.5%*
243* 100%

* Above overall reported averages are adjusted averages for all business classifications, including those classifications indicated as 'n/a' (a classification in which the responses are too low to calculate accurate category averages but applied to the overall averages and totals).

Dive Retailer's 4th Quarter Gross by Time Zone in the USA:
> Dive Retailers residing in the Mountain Time Zone responded with the least decrease in sales for the 4th quarter of 2009. While dive retailers in the Pacific and Mountain Time Zones posted gains in dive travel sales. This is the first gain of any kind seen in over a year.

Retailer Income Table 4th Q '09

Retailers' Time Zone (shows counts); Gross Revenues; New Certs.; Travel Revenues; Equipment Revenues

Mountain Time Zone (9)*
-0.1%
3.7%
3.0%
0.4%

Eastern Time Zone (68)
-7.7%
-11.2%
-13.8%
-8.7%

Central Time Zone (29)
-9.5%
-1.6%
-21.1%
-10.6%

Pacific Time Zone (15)*
-6.2%
-10.9%
2.5%
-5.5%

* Caution should be exercised when interpreting data from fewer than 20 retailers. Mountain Time Zone specifically has a very low count, making the probability of high error rates likely.

Dive Retailer's 1st Quarter 2010 Revenues Projections:

> Retailers have lots of optimism in the 1st quarter '10 projections. These projections are a possible indicator that the retail market is finally headed towards a rebound for 2010. Equipment sales and new certification numbers are most optimistic projections for the 1st Quarter '10:

Retailers' 1st Q '10 Forecasts

1st Q Increase; 1st Q Decrease; 1st Q Same

Gross Revenues
33.3%
13.3%
53.3%

Dive Certification Numbers
40.0%
6.7%
53.3%

Dive Travel Revenues
33.3%
20.0%
26.7%

Equipment Sales Revenues
40.0%
13.3%
46.7%


Dear Industry Professional ,

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Best Regards,
William Cline
President
Cline Group Advertising & Marketing, Est. 1990.

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