Under Armour Inc.'s third-quarter earnings climbed 25 percent, driven by strong sales growth across categories, including a 49 percent jump in women's.
The Baltimore-based performance apparel company also raised its 2007 income and revenue outlook.
For the three months ended Sept. 30, net income was $20 million, or 40 cents a diluted share, compared with $16 million, or 32 cents, in the same period in 2006.
Revenues for the quarter grew 46 percent to $186.9 million from $127.7 million.
Apparel showed 45 percent growth, and the smaller accessories business more than doubled. Women's, men's and children's sales all increased in excess of 40 percent.
"Our third-quarter results reflect strength in both our core apparel business and continued growth in new product categories," Kevin Plank, chairman and chief executive officer, said in a statement. "We're especially excited about the success of our women's marketing campaign entitled BoomBoom-TAP, which illustrated our dedication to the team girl consumer.
"The results included 49 percent top line growth in our women's business this quarter," he said. "This is further proof that the female team athlete continues to demand innovative, performance-oriented product, and we intend to fulfill that demand as we expand our product offering for this consumer."
Although Under Armour beat earnings projections, Citigroup retail analyst Kate McShane pointed to inventory doubling to $151.8 million from $75 million during the same period last year.
"We thought that was excessively high," McShane said. "They said they ran out of some sku's last year, and they think there is going to be demand for that product so they built inventories, but the fourth quarter for retail is still uncertain."
Premarket trading lowered the stock price, but shares rebounded to close at $63.71, up 8.5 percent.
For the first nine months of the year, earnings grew 31 percent to $35.7 million, or 71 cents a diluted share, from $27.1 million, or 55 cents, in the same period of 2006. Revenues for that period climbed 46 percent to $431.7 million from $295.4 million.
Under Armour raised its 2007 earnings projections to a range of $81.5 million to $83 million, up from previous estimates of $79 million to $81 million. The company also revised its revenue outlook to a range of $590 million to $600 million, compared with previous estimates of $580 million to $590 million.McShane noted that this increase did not call for a better-than-anticipated fourth quarter, but reflected only the strength of the third quarter.
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