Columbia Sportswear Q1 net income up 25 percent, raises outlook

Columbia Sportswear Company has reported net sales of 607.3 million dollars for the quarter ended March 31, 2018, an increase of 12 percent or 8 percent constant-currency. Non-GAAP net sales of 599 million dollars, the company said, increased 10 percent or 7 percent constant-currency. First quarter net income increased 25 percent to 45.1 million dollars or 0.64 dollar per diluted share, while non-GAAP net income increased 48 percent to 54.5 million dollars or 0.77 dollar per diluted share.

Commenting on the first quarter trading, the company’s President and CEO Tim Boyle said in a statement: "We are pleased to report better than expected first quarter net sales and profitability led by strength in our direct-to-consumer businesses, growth in our wholesale businesses, including a return to growth in US wholesale, and the favourable effect of strengthening foreign currencies relative to the US dollar."

Columbia Sportswear posts positive results across geographies

US net sales increased 9 percent, attributable to high-teens percent growth in DTC and low-single-digit percent growth in wholesale. The company operated 130 US retail stores at March 31, 2018 compared with 120 at the same time last year.

Latin America, Asia Pacific (LAAP) net sales increased 11 percent or 5 percent constant-currency, while non-GAAP net sales increased 4 percent or decreased 2 percent constant-currency driven by growth in Japan, China, and Korea, partially offset by declines in LAAP distributor net sales. Europe, Middle East and Africa (EMEA) net sales increased 30 percent or 15 percent constant-currency driven by low-30 percent growth (mid-teens percent constant-currency) in Europe-direct and modest growth with EMEA distributors. Canada net sales increased 11 percent or 6 percent constant-currency), largely driven by DTC.

Columbia brand net sales for the quarter increased 13 percent or 10 percent constant-currency to 508.8 million dollars. Sorel brand net sales increased 13 percent or 10 percent constant-currency to 30.8 million dollars. Prana brand net sales increased 9 percent to 42.3 million dollars, while Mountain Hardwear brand net sales decreased 12 percent or 14 percent constant-currency to 24.4 million dollars.

Apparel, accessories and equipment net sales increased 11 percent or 9 percent constant-currency) to 490 million dollars and footwear net sales increased 13 percent or 8 percent constant-currency to 117.3 million dollars. Wholesale net sales during the quarter increased 5 percent or 1 percent constant-currency to 343.9 million dollars. DTC net sales increased 23 percent or 20 percent constant-currency to 263.4 million dollars.

First quarter income of 59.3 million dollars or 9.8 percent of net sales, increased 24 percent, while non-GAAP first quarter 2018 operating income increased 43 percent to 70.3 million dollars or 11.7 percent of net sales.

Columbia Sportswear raises full year outlook

The company currently expects 2018 net sales growth of approximately 8 to 10 percent against prior outlook of 5.5 to 7.5 percent, while non-GAAP net sales growth is expected to be between approximately 6.5 to 8.5 percent compared to prior outlook of 4 to 6 percent, which excludes approximately 40 million dollars in net sales associated with the new revenue accounting standard.

The company expects gross margin to improve by up to 140 basis points and non-GAAP gross margin to improve by up to 60 basis points, excluding an approximately 40 million dollars benefit to gross profit associated with the new revenue accounting standard.

The company expects 2018 operating income between approximately 275 million dollars and 285 million dollars against prior outlook of between 263 million dollars and 273 million dollars, and non-GAAP operating income between approximately 299 million dollars and 308 million dollars compared to prior guidance of between 290 million dollars and 300 million dollars, resulting in operating margin between approximately 10.3 and 10.5 percent against prior outlook of between 10.1 and 10.3 percent, and non-GAAP operating margin between approximately 11.4 and 11.5 percent comrade to prior estimate of between 11.3 and 11.5 percent.

The company expects net income between approximately 213 million dollars and 220 million dollars against prior outlook of between 203 million dollars and 211 million dollars, and non-GAAP net income between approximately 231 million dollars and 238 million dollars compared to prior outlook of between 224 million dollars and 231 million dollars, or diluted earnings per share between approximately 3.01 dollars and 3.11 dollars against prior guidance of between 2.88 dollars and 2.98 dollars, and non-GAAP diluted earnings per share between 3.27 dollars and 3.37 dollars against prior outlook of between 3.17 dollars and 3.27 dollars.

Picture:Facebook/Columbia Sportswear

 

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