Columbia Sportswear cuts full year outlook

Second-quarter net sales at Columbia Sportswear increased 2 percent or 4 percent constant-currency to 578.1 million dollars.

The company said in a release that the increase in net sales primarily reflects growth across the U.S., Canada, Europe-direct, Japan and Korea, partially offset by substantially lower Russia-based distributor and China net sales.

Gross margin contracted 240 basis points to 49.2 percent of net sales, operating income decreased 75 percent to 8.8 million dollars or 1.5 percent of net sales and net income decreased 82 percent to 7.2 million dollars or 11 cents per diluted share.

The company has lowered outlook for the full year due to recent deterioration in market conditions and the economic environment, particularly in the U.S., which continue to exert pressure, unfavourably impacting the retail industry and business.

Commenting on the results, the company’s chairman, president and CEO Tim Boyle said: "First half net sales increased 12 percent, reflecting the strength of our brand portfolio amidst a rapidly changing and increasingly challenging economic environment. As we head into the important Fall sales season, we are eager to get our innovative product into the marketplace.”

Columbia Sportswear lowers FY22 outlook

Net sales for the first half period increased 12 percent or 14 percent constant-currency to 1,339.6 million dollars.

Gross margin contracted 200 basis points to 49.5 percent of net sales, operating income decreased 12 percent to 92.4 million dollars or 6.9 percent of net sales and net income decreased 23 percent to 74 million dollars or 1.16 dollars per diluted share.

The company added that net sales are expected to increase 10 to 12 percent compared to prior outlook of 16 to 18 percent to 3.44 to 3.50 billion dollars against prior guidance of 3.63 to 3.69 billion dollars in 2022.

Gross margin is expected to contract 210 to 180 basis points, operating income is expected to be 415 to 449 million dollars resulting in operating margin of 12.1 to 12.8 percent.

Net income is expected to be 315 to 340 million dollars resulting in diluted earnings per share of 5 dollars to 5.40 dollars.

The company’s board of directors has approved a regular quarterly cash dividend of 30 cents per share, payable on August 31, 2022 to shareholders of record on August 17, 2022.