Strong performance in the Apparel category led
Under Armour Inc
) to post robust fourth-quarter 2012 results. The quarterly
earnings of 47 cents a share came a penny ahead of the Zacks
Consensus Estimate and surged 51% from the comparable year-ago
Total net revenue was also strong at $505.9 million, up 25.5%
year over year and ahead of the Zacks Consensus Estimate of $498
The company witnessed strong year-over-year performances
across all its segments. Consequently, Under Armour now expects
2013 net revenue to be in the range of $2.20 billion to $2.22
billion, up 20%-21% year over year.
The company's largest product category, Apparel, witnessed a
25.1% increase in revenue to $404.5 million, reflecting growth
across men's, women's and youth apparel businesses, and
innovative products such as Studio product and Armour Bra. Under
Armour remains optimistic about a healthy market for Studio
product and Armour Bra.
Footwear net revenues soared 42.7% to $44.7 million, including
the sturdy performance of the UA Spine. Moreover, the company
witnessed strong growth in the 2013 line of new baseball
Net revenue in the Accessories category rose 15.8% to $42.6
million during the quarter, while Licensing revenues elevated
20.7% year over year to $14 million.
Baltimore, Md.-based Under Armour announced that
direct-to-consumer net revenues surged 29% during the quarter,
representing 39% of the total revenue.
Gross profit rose 22.3% to $254.2 million during the quarter,
while gross profit margin contracted 130 basis points to 50.3%,
reflecting unfavourable sales mix and rise in air freight
Operating income increased 47.5% year over year to $81.6
million, whereas operating margin expanded 240 basis points,
reflecting lower marketing and selling costs. Operating income is
now projected to be in the range of $255 million - $257 million
for 2013, up 22%-23% year over year.
Under Armour opened 5 new Factory House stores during the
quarter, increasing the store count to 101. Going forward, the
company intends to add 15 new All-American and 20 blue-chip
shopping shops at
Dick's Sporting Goods Inc
). Moreover, with strong performance across its Women's, Youth
and Underwear segments, the company is witnessing growth in its
floor space at its key department store distribution partners
) and Belk department stores.
Other financial Details
Under Armour ended the quarter with cash and cash equivalents
of $341.8 million, total long-term debt of $62 million and
shareholders' equity of $816.9 million. The company had no
borrowings under its revolving credit facility of $300 million at
the end of the quarter.
Capital expenditures were approximately $23 million for the
quarter under review. Management now expects 2013 capital
expenditures to be in the range of $80 million - $85 million.
Currently, Under Armour holds a Zacks Rank #4 (Sell).
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