Accelerating footwear sales helped Under Armour Inc. record a 38 percent boost in first-quarter profits and lift its stock Tuesday.
The Baltimore-based activewear producer said net income for the period ended March 31 grew to almost $4 million, or 8 cents a diluted share, versus $2.9 million, or 6 cents a share, in the year-ago quarter. Net sales increased 27.1 percent to $200 million, from $157.3 million, a year earlier. Analysts surveyed by Yahoo Finance expected earnings per share of 3 cents on sales of $182.2 million.
Apparel sales rose 2.4 percent to $132.2 million, with the company’s women’s business generating the strongest growth rate. Licensing revenues decreased 7.4 percent to $5.1 million.
But footwear sales, catapulted by the introduction of Under Armour’s new running sneaker and shipments of its performance training shoes, more than tripled for the quarter to $56.9 million from $16.6 million a year ago.
“This past quarter’s successful entry into running, and our increased presence in the mall, are prime examples of how we can combine new product categories with new distribution channels to deliver growth,” chairman and chief executive officer Kevin Plank said on the company earnings call.
Investors sent the company’s stock up $2.80, or 12.9 percent, to close at $24.50 in New York Stock Exchange trading.
Chief financial officer Brad Dickerson said although footwear is planned to be the company’s “largest revenue growth driver in 2009,” he expected the training footwear business to be down during the year.
When the economy begins to improve, Under Armour is poised to be “one of the few companies that will accelerate very quickly,” said Sterne, Agee & Leach analyst Sam Poser, who sees room for the firm to expand globally and in women’s. International sales, which accounted for just 4 percent of total revenues for the quarter, should continue to grow, as the company begins testing apparel at Foot Locker Europe during the back half of the year, he said.
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