Columbia Sportswear Company's Q3 net income increases 60 percent

Columbia Sportswear Company’s net sales increased 15 percent to 804.7 million dollars for the third quarter reflecting direct-to-consumer (DTC) growth and higher fall 2021 wholesale orders.

The company said that net sales growth was constrained by supply chain disruptions that resulted in later inventory receipts and reduced wholesale shipments during the quarter.

Gross margin expanded 180 basis points to 50.7 percent of net sales from 48.9 percent of net sales for the comparable period in 2020. Operating income increased 56 percent to 133.5 million dollars or 16.6 percent of net sales, while net income increased 60 percent to 100.6 million dollars or 1.52 dollars per diluted share.

Commenting on the results, the company’s chairman, president and chief executive officer Tim Boyle said in a statement: “Our third quarter results reflect high consumer demand for our products and strong operating performance amidst unprecedented supply chain challenges. Despite delayed inventory receipts which impacted U.S. wholesale shipments, favorable gross margin performance and expense management fueled above plan earnings.”

Nine months net sales up 26 percent at Columbia Sportswear Company

Net sales increased 26 percent to 1,996.7 million dollars for the first nine month period from 1,585.9 million dollars for the comparable period in 2020.

Gross margin expanded 320 basis points to 51.2 percent of net sales from 48 percent of net sales for the comparable period in 2020. Operating income was 238.9 million dollars or 12 percent of net sales compared to 13.4 million dollars or 0.8 percent of net sales, for the same period in 2020.

Net income was 197.1 million dollars or 2.96 dollars per diluted share compared to 12.3 million dollars or 18 cents per diluted share, for the same period in 2020.

Columbia Sportswear Company lowers revenue outlook

The company said that for the full year ahead net sales are expected to increase 21.5 to 23 percent compared to the prior outlook of 25 to 26.5 percent to 3.04 to 3.08 billion dollars (prior 3.13 dollars to 3.16 billion dollars) from 2.50 billion dollars in 2020.

Gross margin is expected to improve 190 to 210 basis points (prior 95 to 115 basis points) to 50.8 to 51 percent of net sales (prior approximately 49.9 to 50.1 percent) from 48.9 percent of net sales in 2020.

Operating income is expected to be 384 to 405 million dollars (prior 365 to 386 million dollars), resulting in operating margin of 12.6 to 13.2 percent (prior 11.7 to 12.2 percent) compared to operating margin of 5.5 percent in 2020.

Net income is expected to be 302 to 319 million dollars (prior 287 to 304 million dollars), resulting in diluted earnings per share of 4.55 dollars to 4.80 dollars (prior 4.30 dollars to 4.55 dollars).

The company’s board of directors approved a regular quarterly cash dividend of 26 cents per share, payable on December 2, 2021 to shareholders of record on November 18, 2021.