– 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.
Columbia Sportswear Company, 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, Columbia's 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.
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 Company's second quarter 2005 performance in general, the Company's geographic and merchandise category performance, and the Company's 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 Company's website at www.columbia.com. The webcast will be archived on the investor information section of the Company's 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 Company's website at www.columbia.com.