Exhibit 99.1
Columbia Sportswear Company Reports Record Second Quarter 2003 Results
PORTLAND, Ore.--(BUSINESS WIRE)--July 23, 2003--Columbia
Sportswear Company (Nasdaq:COLM):
Highlights:
-- Global sales increased a solid 22.5 percent to a second
quarter record of $152.1 million.
-- On a constant dollar basis, consolidated sales increased by
17.8 percent in the second quarter.
-- Net income increased 25.3 percent to $9.4 million, a second
quarter record, or $0.23 per diluted share, vs. $0.19 last
year.
-- Full year 2003 net income guidance raised to 10 percent to 12
percent year over year growth.
-- The Company plans to construct a Midwestern U.S. footwear
distribution center.
Columbia Sportswear Company (Nasdaq: COLM), a global leader in the
active outdoor apparel and footwear industries, today announced record
second quarter net sales of $152.1 million for the quarter ended June
30, 2003, an increase of 22.5 percent over net sales of $124.2 million
for the same period of 2002. The Company reported record net income
for the second quarter of $9.4 million, a 25.3 percent increase over
net income of $7.5 million for the same period of 2002. Earnings per
share for the second quarter of 2003 were $0.23 (diluted) on 40.6
million weighted average shares, compared to earnings per share of
$0.19 (diluted) for the second quarter of 2002 on 40.1 million
weighted average shares.
Compared to the second quarter of 2002, U.S. sales increased by
4.1 percent to $90.5 million, Canadian sales increased by 52.8 percent
to $11.0 million, European sales increased by 37.8 percent to $20.4
million and Other International sales increased 97.4 percent to reach
$30.2 million for the second quarter of 2003. International
distributor sales, including Russia, accounted for the majority of the
growth in the Other International sales category.
When measured in constant dollar terms, Canadian sales grew by
38.3 percent, European sales increased by 10.4 percent, and Other
International sales increased 92.5 percent for the second quarter of
2003. Consolidated net sales for the second quarter of 2003 increased
17.8 percent to $146.3 million in constant dollars, when compared to
the same period of last year.
Outerwear sales increased 13.9 percent to $46.7 million,
sportswear sales increased 13.3 percent to $68.8 million, footwear
sales increased 60.8 percent to $28.3 million, and accessories sales
increased 18.4 percent to $5.8 million, when compared to the second
quarter of 2002. Mountain Hardwear, our newly acquired subsidiary,
contributed $6.3 million in sales during the second quarter. Equipment
sales, a new category consisting of tents and sleeping bags sold by
Mountain Hardwear, were $2.5 million in the quarter.
Net income expanded 25.3 percent to a second quarter record $9.4
million. Net income growth was primarily the result of operating
margin leverage generated from strong sales growth, particularly the
expansion of our international distributor revenue base which carries
minimal SG&A costs.
Tim Boyle, Columbia's president and chief executive officer,
commented, "We are excited with our solid second quarter results,
demonstrating the expanding acceptance of our brands in key markets
worldwide. 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. Based on the brand's comparative
performance during the spring 2003 season and improvements for the
spring 2004 product lines, we are currently optimistic about the
opportunity to grow the spring 2004 business. As is customary, we will
announce our consolidated spring 2004 order backlog as a component of
our third quarter release on October 23rd, 2003."
Midwestern U.S. Distribution Center
In anticipation of continuing growth of the Company's U.S.
footwear business, and more specifically, Columbia's migration to
being a year-round footwear resource for our customers, the Company
plans to construct a distribution center focused on the footwear
category located in the Midwestern U.S. The facility will improve
proximity to major customers and should help facilitate footwear
reorders. Nearly half of the U.S. population and approximately 45
percent of retail sales would be located within two standard shipping
days of a Midwest facility. The state of the art distribution center
is expected to be approximately 400,000 sq. ft., cost an estimated $40
million, and begin operating in 2005. While it will be constructed
with a specific focus on footwear, it will be designed and engineered
to support other product lines for our brands as well.
Guidance
Boyle continued, "At this point, we believe that our strategies
will enable us to generate third quarter 2003 revenue growth of 9
percent to 11 percent and net income growth of 4 percent to 6 percent
as compared to the third quarter of 2002. 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."
The Company will host a conference call to elaborate on second
quarter 2003 results on Wednesday, July 23 at 5 p.m. Eastern. The call
will include discussions regarding the Company's second quarter 2003
performance in general, the Company's geographic and merchandise
category performance, and the Company's future opportunities. To
participate, please dial 800-358-8449 in the United States (outside
the United States, please dial 706-634-7408) 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. An
audio replay will be available for 24 hours after the call has ended.
To access, please dial 800-642-1687 in the United States (outside the
United States, please dial 706-645-9291) and enter reservation #
3624344. The webcast can also be accessed on the investor information
section of the Company's website at www.columbia.com until Aug. 15,
2003.
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 Web site at
www.columbia.com.
This press release contains forward-looking statements, including
Boyle's statements regarding anticipated revenues and earnings in 2003
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 Company's
Quarterly Report on Form 10-Q for the period ended March 31, 2003,
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 deliveries
include, but are not limited to, business disruptions and costs
arising from disease outbreaks, acts of terrorism or military
activities around the globe; unfavorable economic conditions generally
and weakness in consumer confidence; the financial health of Company
customers; the Company's ability to cost-effectively integrate Sorel
and Mountain Hardwear into its existing operations; the Company's
ability to effectively deliver its products to customers in a timely
manner due to potential service interruptions; the Company's 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 Company's products);
dependence on independent manufacturers and suppliers; effectiveness
of the Company's sales and marketing efforts; intense competition in
the industry (which the Company expects to increase); the Company's
ability to achieve and manage growth effectively; international risks
including trade disruptions, political instability in foreign markets,
exchange rate fluctuations, changes in quotas and tariffs or other
duties; effective implementation and expansion of the Company's
distribution facilities; operations of the Company's and third party
computer systems; and the Company's 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 our
expectations.
COLUMBIA SPORTSWEAR COMPANY
CONSOLIDATED BALANCE SHEETS
(In thousands)
June 30,
---------------------
2003 2002
-------- --------
Current Assets:
Cash and cash equivalents $ 158,817 $ 71,569
Accounts receivable, net 128,244 103,144
Inventories 181,646 170,695
Deferred tax asset 11,104 14,604
Prepaid expenses and other current assets 9,762 4,720
-------- --------
Total current assets 489,573 364,732
Property, plant and equipment, net 121,125 116,354
Intangibles and other assets 36,623 7,465
-------- --------
Total assets $ 647,321 $ 488,551
======== ========
Current Liabilities:
Notes payable $ 7,842 $ 12,069
Accounts payable 61,395 45,423
Accrued liabilities 25,713 23,539
Current portion of long-term debt 4,490 4,614
-------- --------
Total current liabilities 99,440 85,645
Long-term debt 20,154 24,648
Deferred tax liability 6,872 946
Shareholders' equity 520,855 377,312
-------- --------
Total liabilities and shareholders'
equity $ 647,321 $ 488,551
======== ========
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
------------------- -------------------
2003 2002 2003 2002
-------- -------- -------- --------
Net sales $152,077 $124,195 $320,948 $267,494
Cost of sales 87,358 70,101 179,485 152,249
-------- -------- -------- --------
Gross profit 64,719 54,094 141,463 115,245
42.6% 43.6% 44.1% 43.1%
Selling, general, and
administrative 49,800 42,787 102,856 89,014
-------- -------- -------- --------
Income from operations 14,919 11,307 38,607 26,231
Interest (income) expense, net (189) (276) (372) (167)
-------- -------- -------- --------
Income before income tax 15,108 11,583 38,979 26,398
Income tax provision 5,665 4,047 14,617 9,899
-------- -------- -------- --------
Net income $ 9,443 $ 7,536 $ 24,362 $ 16,499
======== ======== ======== ========
Net income per share:
Basic $ 0.24 $ 0.19 $ 0.61 $ 0.42
Diluted 0.23 0.19 0.60 0.41
Weighted average shares
outstanding:
Basic 39,926 39,399 39,848 39,351
Diluted 40,644 40,127 40,446 40,046
CONTACT: Columbia Sportswear Company
David W. Kiser, 503/985-4584