Columbia Sportswear FY15 net sales jump 11 percent

Columbia Sportswear Company registered fourth quarter net sales of 699.4 million dollars for the period ending December 31, 2015, a 3 percent increase or 7 percent on constant-currency basis. Full year 2015 net sales increased 225.6 million dollars, 11 percent or 15 percent on constant-currency basis, to 2.33 billion dollars, while operating income increased 26 percent to 249.7 million dollars, representing operating margin of 10.7 percent.

“2015 was another outstanding year for Columbia Sportswear Company. Record net sales, record operating income, expanded operating margin, and record net income validate that our strategies are driving growth and improved profitability,” commented Chief Executive Officer Tim Boyle, adding, “Looking forward to 2016, our balance sheet gives us the financial flexibility to continue to drive sales growth, expand gross margins and increase brand awareness to further strengthen our brands and improve profitability.”

Detailed review of the fourth quarter results

Fourth quarter 2015 operating income increased to 82.3 million dollars and net income increased 14 percent to 63.4 million dollars, or 0.90 dollar per diluted share. Full year 2015 net income, including five months of incremental results from the prAna brand, increased 27 percent to a 174.3 million dollars, or 2.45 dollars per diluted share.

Fourth quarter consolidated net sales growth was driven by US net sales growth of 10 percent to 446.2 million dollars, reflecting growth from the Columbia, Sorel, prAna and Mountain Hardwear brands. This growth was partially offset by a 15 percent or 6 percent on constant currency basis net sales decline in the Europe/Middle East/Africa (EMEA) region to 58.2 million dollars, including mid-teen constant-currency net sales growth in the company's Europe-direct business (flat in US dollars) that was more than offset by a decline of more than 30 percent in net sales to EMEA distributors.

The company witnessed a 4 percent net sales decline or 2 percent growth constant-currency in the Latin America/Asia Pacific (LAAP) region to 149.7 million dollars, including net sales growth of more than 40 percent to LAAP distributors that was more than offset by net sales declines in the company's Asian markets, although Japan and China posted net sales growth on a constant-dollar basis; and a 7 percent net sales decline or 10 percent growth in constant-currency in Canada.

Global Columbia brand net sales of 528.9 million dollars increased less than 1 percent or 3 percent on constant currency. Global Sorel brand net sales increased 14 percent or 21 percent constant-currency to 105.3 million dollars. Global prAna brand net sales increased 39 percent or 39 percent constant-currency) to 27.7 million dollars, and global Mountain Hardwear brand net sales increased 2 percent or 5 percent constant-currency) to 35.2 million dollars. Global Apparel, Accessories & Equipment net sales increased 1 percent or 4 percent constant-currency to 515.6 million dollars, and Footwear net sales increased 10 percent or 16 percent constant-currency to 183.8 million dollars.

FY15 sees growth in the US and Canada

Organic growth equated to approximately 8 percent or 12 percent constant-currency, excluding five months of incremental net sales of approximately 56 million dollars from the prAna brand, which the company acquired in May 2014. Consolidated 2015 net sales growth of 11 percent included, 21 percent growth in US net sales, to 1.46 billion dollars, including five months of incremental prAna net sales of approximately 48.5 million dollars. Organic US net sales increased 17 percent.

The company reported 11 percent or 30 percent net sales growth in Canada to 168.6 million dollars. A 10 percent net sales decline in the EMEA region (flat constant-currency) to 233.2 million dollars, reflecting a low single-digit net sales increase (low 20-percent constant-currency) in the company's Europe-direct markets, more than offset by a mid-20-percent decline in net sales to EMEA distributors. A 5 percent net sales decline in the LAAP region (2 percent growth constant-currency) to 469.2 million dollars, reflecting mid-20-percent growth in net sales to LAAP distributors, more than offset by lower sales in Korea and Japan. On a constant-currency basis, Japan posted net sales growth. Net sales in China were essentially flat (2 percent growth constant-currency).

Global Columbia brand net sales increased 7 percent or 10 percent constant-currency to 1.86 billion dollars. Global Sorel brand net sales increased 26 percent or 34 percent constant-currency to 209.2 million dollars. Global prAna brand net sales increased 133 percent, Global Mountain Hardwear brand net sales declined 3 percent (increased 1 percent constant-currency) to 116.3 million dollars. Global Apparel, Accessories & Equipment net sales increased 9 percent or 12 percent constant-currency to 1.82 billion dollars and Global Footwear net sales increased 19 percent or 26 percent on constant-currency to 505 million dollars.

Dividend and outlook for 2016

The board of directors authorized a regular quarterly dividend of 0.17 dollar per share, payable on March 17, 2016 to shareholders of record on March 4, 2016.

The company’s full year 2016 financial outlook anticipates mid-single-digit percent net sales increase compared with 2015 net sales of 2.33 billion dollars, including approximately 1 percentage point negative effect from changes in currency exchange rates; operating income of 257 million dollars to 267 million dollars, representing operating margin of up to 10.8 percent; and net income of between approximately 179 million dollars and 186 million dollars, or 2.55 dollars to 2.65 dollars per diluted share.