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Sep 30, 2022
Columbia Q3 2022 Earnings Report
Columbia's Q3 2022 earnings reflected broad momentum with record net sales and earnings growth.
Key Takeaways
Columbia Sportswear Company reported a strong third quarter with net sales increasing by 19% to a record $955.0 million and diluted earnings per share increasing by 18% to $1.80. The company is reiterating its full year net sales and diluted earnings per share financial outlook.
Net sales increased 19 percent (22 percent constant-currency) to a record $955.0 million.
Operating income increased 9 percent to $145.3 million, or 15.2 percent of net sales.
Diluted earnings per share increased 18 percent to $1.80.
Reiterating full year net sales and diluted earnings per share financial outlook.
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
The Company's fourth quarter and full year 2022 Financial Outlook is forward-looking in nature and reflects expectations as of October 27, 2022. Net sales are expected to increase 10 to 12 percent to $3.44 to $3.50 billion. Diluted earnings per share is expected to be $5.00 to $5.40.
Positive Outlook
- Net sales are expected to increase 10 to 12 percent (unchanged) to $3.44 to $3.50 billion (unchanged) from $3.13 billion in 2021.
- SG&A expense, as a percent of net sales, is expected to be 37.4 to 37.8 percent (prior 37.6 to 38.0 percent), compared to SG&A expense as a percent of net sales of 37.8 percent in 2021.
- Demand creation expense as a percent of net sales is anticipated to be approximately 6.0 percent in 2022, compared to 5.9 percent in 2021.
- Effective income tax rate is expected to be approximately 23.5 percent (prior approximately 24.0 to 24.5 percent).
- Net income is expected to be $315 to $340 million (unchanged), resulting in diluted earnings per share of $5.00 to $5.40 (unchanged).
Challenges Ahead
- Gross margin is expected to contract 250 to 220 basis points (prior approximately 210 to 180 basis points of contraction) to 49.1 to 49.4 percent (prior 49.5 to 49.8 percent) of net sales from 51.6 percent of net sales in 2021.
- Operating income is expected to be $410 to $443 million (prior $415 to $449 million), resulting in operating margin of 11.9 to 12.7 percent (prior 12.1 to 12.8 percent), compared to operating margin of 14.4 percent in 2021.
- Foreign currency translation is anticipated to reduce 2022 net sales growth by approximately 350 basis points (prior 300 bps).
- Foreign currency is expected to have an approximately $0.25 negative impact on diluted earnings per share due primarily to unfavorable foreign currency translation impacts (prior $0.15 to $0.20 negative impact).
- Operating cash flow is expected to be approximately breakeven (prior approximately $150 million).
Revenue & Expenses
Visualization of income flow from segment revenue to net income