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Columbia Sportswear Company: Q3 net income rises 14 percent

By Prachi Singh

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Business

For its third quarter, Columbia Sportswear Company reported consolidated net sales increase of 6 percent or 7 percent constant-currency to 795.8 million dollars. Non-GAAP net sales, the company said, increased 6 percent to 788.9 million dollars. Net income for the quarter increased to 100.2 million dollars or 1.42 dollars per diluted share, a 14 percent increase compared to 87.7 million dollars or 1.25 dollars per diluted share, in the third quarter of 2017.

Non-GAAP net income of 99.3 million dollars or 1.41 dollars per diluted share, increased 11 percent compared to 89.8 million dollars or 1.28 dollars per diluted share, in the third quarter of 2017.

Highlights of Columbia Sportswear’s Q3

The company said, net sales in the US increased 9 percent, attributable to low-20 percent growth in direct-to-consumer and low-single-digit percent growth in wholesale. The company operated 135 US retail stores at September 30, 2018 compared with 127 at the same time last year. Reported Latin America Asia Pacific (LAAP) net sales decreased 4 percent or 3 percent at constant-currency, while LAAP non-GAAP net sales decreased 9 percent driven by declines in LAAP distributor business and China, offset by growth in Japan and Korea.

Europe Middle East and Africa (EMEA) net sales increased 15 percent, led by high-teens percent Europe-direct growth while EMEA distributors net sales were flat. Canada net sales were flat but rose 3 percent at constant-currency, reflecting strong DTC net sales performance and flat wholesale net sales.

Columbia brand net sales increased 7 percent or 8 percent constant-currency to 640.9 million dollars, Sorel brand net sales increased 12 percent or 13 percent constant-currency to 91.2 million dollars, while Prana brand net sales increased 8 percent to 39.9 million dollars. Mountain Hardwear brand net sales, however, decreased 22 percent or 21 percent constant-currency to 23 million dollars.

Apparel, accessories and equipment net sales increased 6 percent or 7 percent constant-currency to 617.6 million dollars and footwear net sales increased 6 percent or 7 percent constant-currency to 178.2 million dollars. Wholesale net sales were essentially flat but rose 1 percent at constant-currency to 544.8 million dollars and DTC net sales increased 23 percent to 251 million dollars.

Columbia Sportswear raises full year outlook

The company currently expects 2018 net sales growth of approximately 11 to 11.5 percent compared to prior 9 to 10.5 percent, compared with 2017 net sales of 2.47 billion dollars. The company expects non-GAAP net sales growth of approximately 9.5 to 10 percent compared to prior expectation of 7.5 to 9 percent, which excludes approximately 40 million dollars in net sales associated with the new revenue accounting standard.

Full year gross margin is expected to improve by up to 165 basis points (prior up to 140 basis points) and non-GAAP gross margin to improve by up to 90 basis points (prior up to 60 basis points). The company expects 2018 net income between approximately 240 million dollars and 244 million dollars (prior between 223 million dollars and 230 million dollars), and non-GAAP net income between approximately 252 million dollars and 255 million dollars (prior between 239 million dollars and 246 million dollars), or diluted earnings per share between approximately 3.41 dollars and 3.46 dollars (prior between 3.15 dollars and 3.25 dollars), and non-GAAP diluted earnings per share between 3.57 dollars and 3.62 dollars (prior between 3.37 dollars and 3.47 dollars).

Picture:Facebook/Columbia Sportswear

Columbia Sportswear