Columbia Sportswear Q1 sales up 8 percent, narrows outlook

Net sales at Columbia Sportswear Company increased 8 percent or 10 percent constant-currency to 820.6 million dollars in the first quarter of 2023. The company said, increase in net sales primarily reflects earlier shipment of spring 2023 wholesale orders and direct-to-consumer (DTC) growth.

For 2023, net income is expected to be 322 to 336 million dollars compared to prior outlook of 322 to 347 million dollars, resulting in diluted earnings per share of 5.15 dollars to 5.40 dollars against prior estimate of 5.15 dollars to 5.55 dollars.

Gross margin for the quarter contracted 100 basis points to 48.7 percent of net sales from 49.7 percent of net sales for the comparable period in 2022. Operating income decreased 33 percent to 56.4 million dollars or 6.9 percent of net sales, and net income decreased 31 percent to 46.2 million dollars or 74 cents per diluted share.

Commenting on the trading results, the company’s chairman, president and CEO Tim Boyle said in a statement: “We were able to generate healthy net sales growth, up 8 percent year-over-year, as consumer demand remained strong in many areas of our business. After three years of pandemic related supply chain constraints, it’s gratifying to see that our wholesale on-time delivery rates have returned to pre-pandemic service levels. 2023 is off to a solid start and we are reiterating our full year net sales outlook, while narrowing our diluted EPS range.”

The company added that for 2023 net sales are expected to increase 3 to 6 percent to 3.57 dollars to 3.67 billion dollars from 3.46 billion dollars in 2022. Gross margin is expected to expand approximately 60 basis points to approximately 50 percent of net sales.

Operating income is expected to be 413 dollars to 432 million dollars against prior outlook of 413 to 448 million dollars, resulting in operating margin of 11.6 to 11.8 percent compared to prior forecast of 11.6 to 12.2 percent.

For the first half, the company anticipates net sales growth of mid-single-digit percent and diluted earnings per share to be at the low end of our prior range of 75 cents to 90 cents.

The company’s board of directors approved a regular quarterly cash dividend of 30 cents per share, payable on June 1, 2023 to shareholders of record on May 18, 2023.