EXHIBIT 99.1
2 Q Financial Report
|
|
|
Contact:
|
|
David W. Kiser
Director of Investor Relations
Columbia Sportswear Company
(503) 985-4584 |
COLUMBIA SPORTSWEAR COMPANY
REPORTS SECOND QUARTER 2005 RESULTS
Highlights:
|
|
Global net sales increased to $186.2 million, an 8.8 percent increase over second
quarter 2004 sales of $171.1 million. |
|
|
Second quarter net income was $6.3 million, or $0.16 per diluted share, compared to
$10.7 million, or $0.26 per diluted share, for the same period last year. |
|
|
During the second quarter, approximately 2.6 million shares of common stock were
repurchased at an aggregate purchase price of approximately $116.5 million. |
|
|
Company reaffirms prior fiscal 2005 guidance of revenue growth of approximately 5
percent, and net income decline of 8 to 12 percent. |
PORTLAND, Ore. July 28, 2005 Columbia Sportswear Company (Nasdaq: COLM), a global leader in the
active outdoor apparel and footwear industries, today announced net sales of $186.2 million for the
quarter ended June 30, 2005, an increase of 8.8 percent over net sales of $171.1 million for the
same period of 2004. The Company reported net income for the second quarter of $6.3 million, a
41.1 percent decrease over net income of $10.7 million for the same period of 2004. Earnings per
share for the second quarter of 2005 were $0.16 (diluted) on 39.3 million weighted average shares,
compared to earnings per share of $0.26 (diluted) for the second quarter of 2004 on 41.1 million
weighted average shares.
Compared to the second quarter of 2004, Other International sales increased 44.7 percent to $40.8
million, U.S. sales increased 4.2 percent to $110.3 million, European sales increased 3.7 percent
to $25.4 million, and Canadian sales decreased 22.4 percent to $9.7 million for the second quarter
of 2005.
Excluding changes in currency exchange rates, Other International sales increased 41.2 percent,
European sales decreased 0.8 percent, and Canadian sales decreased 28.3 percent for the second
quarter of 2005. Consolidated net sales for the second quarter of 2005 increased 7.1 percent,
excluding changes in currency exchange rates, compared to the same period of last year.
For the second quarter of 2005, sportswear sales increased 13.3 percent to $102.4 million, footwear
sales increased 11.7 percent to $34.3 million, accessories sales increased 3.0 percent to $6.8
million, equipment sales increased 3.8 percent to $2.7 million, and outerwear sales decreased 2.0
percent to $40.0 million compared to the second quarter of 2004.
Tim Boyle, Columbias president and chief executive officer, commented, We have made significant
long-term investments in distribution capacity, product design and sourcing infrastructure, and
have increased advertising to strengthen our brands to support our long-term growth. These are
essential investments and are competitive advantages that position us to remain a primary vendor in
a consolidating retail landscape. During the second quarter, we significantly improved inventory
levels going into the peak fall shipping season by increasing our shipments of closeout
merchandise. These lower margin close-out sales, coupled with our long-term investments, are
compressing operating margins in the near-term, but we believe these investments are essential to
our long-term growth.
Our strong financial position provides significant financial flexibility. Our board previously
authorized an aggregate $200 million share repurchase program, and during the second quarter, we
repurchased approximately 2.6 million shares for $116.5 million. To date, we have repurchased
approximately 3.5 million shares for an aggregate purchase price of $164.1 million, with $35.9
million remaining under the program.
In reviewing the second quarter results, investors should be aware that the second quarter is our
smallest revenue quarter of the year, as we conclude our spring product shipping season and begin
shipping fall products late in the quarter. Due to the comparatively low revenue levels in the
quarter, changes in shipments in any one channel, geography or category may be excessively
pronounced and may not necessarily be indicative of future results, continued Mr. Boyle.
Guidance
Mr. Boyle continued, Based on our current outlook, we expect third quarter 2005 revenue to decline
3 to 4 percent, and net income to decline 12 to 14 percent, compared to the third quarter of 2004.
For the full year 2005, we continue to maintain previously stated revenue and earnings guidance of
net sales growth of approximately 5 percent, and net income decline of 8 to 12 percent when
compared to 2004. These projections are forward-looking in nature, and are based on backlog and
forecasts, which may change, perhaps significantly.
The Company will host a conference call to elaborate on second quarter 2005 results on Thursday,
July 28, 2005 at 5:00 p.m. Eastern. The call will include discussions regarding the Companys
second quarter 2005 performance in general, the Companys geographic and merchandise category
performance, and the Companys future opportunities. To participate, please dial 800-851-3059 in
the United States (outside the United States, please dial 706-679-8430) five to ten minutes prior
to the call. The call will also be webcast live on the investor information section of the
Companys website at www.columbia.com. The webcast will be archived on the investor
information section of the Companys website until August 11, 2005.
Founded in 1938 in Portland, Ore., Columbia Sportswear Company is a global leader in the design,
sourcing, marketing and distribution of active outdoor apparel and footwear. As one of the largest
outerwear manufacturers in the world and the leading seller of skiwear in the United States, the
Company has developed an international reputation for quality, performance, functionality and
value. To learn more about Columbia Sportswear, please visit the Companys website at
www.columbia.com.
This press release contains forward-looking statements, including Mr. Boyles statements regarding
anticipated revenues and earnings for the third quarter of 2005 and for the full year 2005 and
growth in future periods. Actual results could differ materially from those projected in these and
other forward-looking statements as a result of a number of risks and uncertainties, including
those set forth in this press release, those described in the Companys Quarterly Report on
Form 10-Q for the quarter ended March 31, 2005, under the heading Factors That May Affect Our Business
and the Price of Our Common Stock, and other risks and uncertainties that have been or may be
described from time to time in other reports filed by the Company, including reports on Form 8-K,
Form 10-Q, and Form 10-K. Risk factors that may affect future revenues, earnings and growth
include international risks, including trade disruptions, political instability in foreign markets,
exchange rate fluctuations, and changes in quotas and tariffs or other duties; unfavorable economic
conditions generally and weakness in consumer confidence; the financial health of Company
customers; the Companys ability to effectively deliver its products to customers in a timely
manner despite potential service interruptions; the Companys reliance on product acceptance by
consumers; effects of unseasonable weather (including, for example, warm weather in the winter and
cold weather in the spring, which affects demand for the Companys products); dependence on
independent manufacturers and suppliers; effectiveness of the Companys sales and marketing
efforts; intense competition in the industry (which the Company expects to increase); business
disruptions and costs arising from disease outbreaks, acts of terrorism or military activities
around the globe; effective implementation and expansion of the Companys distribution facilities;
operations of the Companys and third party computer systems; and the Companys ability to
establish and protect its intellectual property. Although forward-looking statements help provide
complete information about the Company, investors should keep in mind that forward-looking
statements are inherently less reliable than historical information. The Company does not undertake
any duty to update any of the forward-looking statements after the date of this release to conform
them to actual results or to changes in Company expectations.
-table follows-