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Jun 30, 2022
Columbia Q2 2022 Earnings Report
Columbia's Q2 2022 financial results were reported, showing mixed performance amid a challenging economic environment.
Key Takeaways
Columbia Sportswear reported a 2% increase in net sales to $578.1 million in Q2 2022, but experienced a 75% decrease in operating income to $8.8 million and an 82% decrease in diluted earnings per share to $0.11. The company updated its full year 2022 financial outlook, reflecting a more conservative approach due to growing economic uncertainty.
Net sales increased 2% to a record $578.1 million, driven by growth in the U.S., Canada, Europe-direct, Japan, and Korea, but offset by lower sales in Russia and China.
Operating income decreased 75% to $8.8 million, or 1.5% of net sales, due to gross margin contraction and increased SG&A expenses.
Diluted earnings per share decreased 82% to $0.11, compared to $0.61 in the same quarter last year.
The company repurchased $69.6 million of common stock during the second quarter.
Columbia
Columbia
Columbia Revenue by Geographic Location
Revenue by Geographic Location
United States Revenue
CapyFin.comLatin America and Asia Pacific Revenue
CapyFin.comEurope, Middle East and Africa Revenue
CapyFin.comCanada Revenue
CapyFin.com Forward Guidance
Columbia Sportswear Company updated its full year 2022 financial outlook to reflect growing economic uncertainty.
Positive Outlook
- Net sales are expected to increase 10 to 12 percent to $3.44 to $3.50 billion compared to 2021.
- SG&A expenses are expected to increase roughly in line with net sales growth.
- Demand creation as a percent of net sales is anticipated to be 6.0 percent in 2022, compared to 5.9 percent in 2021.
- Effective income tax rate is expected to be approximately 24.0 to 24.5 percent.
- Capital expenditures are planned to be between $80 to $100 million.
Challenges Ahead
- Foreign currency translation is anticipated to reduce 2022 net sales growth by approximately 300 basis points.
- Foreign currency is expected to have a $0.15 to $0.20 negative impact on earnings due to unfavorable foreign currency translation impacts.
- Gross margin is expected to contract 210 to 180 basis points to 49.5 to 49.8 percent of net sales from 51.6 percent of net sales in 2021.
- Operating income is expected to be $415 to $449 million, resulting in operating margin of 12.1 to 12.8 percent, compared to operating margin of 14.4 percent in 2021.
- Net income is expected to be $315 to $340 million, resulting in diluted earnings per share of $5.00 to $5.40.
Revenue & Expenses
Visualization of income flow from segment revenue to net income