NEW YORK — Double-digit sales growth in outerwear, sportswear, accessories and footwear paved the way for robust second-quarter earnings results at Columbia Sportswear Co.
For the three months ended June 30, the Portland, Ore.-based company said net income spiked 25.3 percent to $9.4 million, or 23 cents a diluted share, from $7.5 million, or 19 cents, last year. The company beat Wall Street consensus estimates by 3 cents. Sales jumped 22.5 percent to $152.1 million from $124.2 million.
Tim Boyle, Columbia’s president and chief executive officer, said in a statement, “Second-quarter results were bolstered by healthy footwear and sportswear sales, categories where we see significant growth opportunities, validating our strategies to further develop these product categories and illustrating the growing global popularity of our products on a year-round basis.”
He boasted to Wall Street analysts during a conference call, “As you can tell, we’re thrilled with our second-quarter financial results.”
By category, outerwear sales rose 13.9 percent to $46.7 million, while sportswear sales increased 13.3 percent to $68.8 million. Accessories sales grew 18.4 percent, but it was footwear sales that showed the most gain, rising 60.8 percent to $28.3 million.
U.S. sales inched up 4.1 percent to $90.5 million, while Canadian sales soared 52.8 percent to $11 million. European sales also gained, rising 37.8 percent to $20.4 million. Helped by strong growth in Russia, other international sales rose 97.4 percent to $30.2 million in the quarter.
In anticipation of growth in the footwear category, the company plans to construct a distribution center focused on footwear in the Midwestern U.S., although it will be able to support other product lines as well. Boyle noted during the call that 45 percent of retail sales would be located within two standard shipping days of the facility, which is expected to be around 400,000 square feet at a construction cost of $40 million. The current plan is for the facility to become operational in 2005.
Columbia said that Mountain Hardwear, its newly acquired subsidiary, contributed $6.3 million in sales during the quarter.
Boyle said in a statement that the company expects to generate 2003 third-quarter revenue growth of 9 percent to 11 percent and net income growth of 4 percent to 6 percent over last year’s results. “For the full year 2003, we continue to believe that our strategies will enable us to generate revenue growth of between 12 percent and 14 percent when compared to 2002 revenue, and we are raising our guidance for net income growth to 10 percent to 12 percent for the full year.”For the six months, income jumped 47.7 percent to $24.4 million, or 60 cents, from $16.5 million, or 41 cents, a year ago. Sales increased by 20 percent to $320.9 million from $267.5 million.
The firm did not report backlog for the current quarter. Virginia Genereux of Merrill Lynch said in a report that Columbia’s fall and spring backlog orders are typically reported with first- and third-quarter earnings results.
Separately, Columbia said William Tung joined the firm as director of international sales and operations, reporting directly to Boyle. He succeeds Greg Barron, who is retiring this month. Tung was most recently regional director of The Body Shop International plc and prior to that spent seven years with The Rockport Co. in regional management roles in both Asia and Europe.
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