Companies

Columbia Sportswear earnings decline

May 12, 2023 United States

The US-based company reported a net sales increase of 8% in the first quarter of 2023, but a net income decrease of 31%, as compared to the same period of last year

“First quarter results highlight the importance and value of our diversified global business model. We were able to generate healthy net sales growth, up 8% year-over-year, as consumer demand remained strong in many areas of our business. After three years of pandemic-related supply chain constraints, it's gratifying to see that our wholesale on-time delivery rates have returned to pre-pandemic service levels”, commented Chairman, President and Chief Executive Officer Tim Boyle.

First Quarter Results

In the first quarter of fiscal 2023, Columbia's net sales rose by 8% (by 10% on constant currency), amounting to 820.6 million US dollars, as compared to the same period of the prior year.

Columbia brand net sales in this first quarter totalled 702.8 million US dollars, up by 9% (by 12% on constant currency), and Mountain Hardwear net sales reached 24.8 million US dollars, up by 16% (by 18% on constant currency), on a comparable basis to a similar period of fiscal 2022.

Meanwhile, Sorel registered a net sales decline of 5% (down by 3% on constant currency) to 60.5 million US dollars in the first three months of 2023, year-over-year, while prAna net sales decreased by 1% as reported and on constant currency, adding 32.5 million US dollars to the total revenue.

Columbia Sportswear's gross margin narrowed by 100 basis points to 48.7% in the first quarter of the current fiscal year from 49.7% in the same quarter of last year. Such as due to the “increased promotional activity, compared to exceptionally low promotions in first quarter 2022, partially offset by favourable inbound ocean freight costs”.

In the three months to the 31^st of March, the company's net income totalled 46.2 million US dollars, or 0.74 US dollars per diluted share, on a comparable basis to the 66.8 million US dollars net income, or 1.03 US dollars per diluted share, recorded in the same months of 2022.

Fiscal 2023 Outlook

“2023 is off to a solid start and we are reiterating our full year net sales outlook, while narrowing our diluted EPS range. We are executing on our plan to reduce inventory levels, while focusing on profitability”, added Tim Boyle.

So, for fiscal 2023, Columbia Sportswear is still expecting its net sales to increase by 3% to 6%, reaching between 3.57 billion US dollars and 3.67 billion US dollars from the 3.46 billion US dollars posted in 2022.

However, the company's full year net income should range from 322 million US dollars to 336 million US dollars (previous guidance: 322 million US dollars to 347 million US dollars), resulting in diluted earnings per share of 5.15 US dollars to 5.40 US dollars (before, 5.15 US dollars to 5.55 US dollars).

Image Credits: namebrandapparel.com

United States Columbia Sportswear Companies Footwear Quarter Results Results