Columbia Sportswear (COLM) Tops Q1 EPS by 19c, Beats on Revenues; Boosts FY18 Guidance

Columbia Sportswear (NASDAQ: COLM) reported Q1 EPS of $0.77, $0.19 better than the analyst estimate of $0.58. Revenue for the quarter came in at $599 million versus the consensus estimate of $581.42 million.

* Our updated full year 2018 non-GAAP financial outlook excludes net sales of approximately $40 million, with an offsetting increase in SG&A expenses of approximately $40 million associated with the new revenue accounting standard, as well as Project CONNECT program expenses and discrete costs of approximately $23 million, $18 million net of tax, or $0.25 per diluted share (prior $27 million, $21 million net of tax, or $0.29 per diluted share).

** Our updated full year 2018 financial outlook anticipates an estimated full-year effective income tax rate of approximately 22 percent, which may be affected by further refinement of our 2017 provisional TCJA estimates, as well as changes in our geographic mix of pre-tax income and other discrete events that may occur during the year. In the first quarter of 2018, we incurred $1.0 million, or $0.01 per diluted share, in incremental provisional income tax expense related to the TCJA.

For more information on our non-GAAP financial measures and a reconciliation of GAAP to non-GAAP measures, please refer to the "Supplemental Financial Information\" tables provided in this press release.

Columbia Sportswear Company (NASDAQ: COLM) today announced record net sales of $607.3 million for the quarter ended March 31, 2018, an increase of 12 percent (8 percent constant-currency), compared with net sales of $543.8 million for the first quarter of 2017. Non-GAAP net sales of $599.0 million increased 10 percent (7 percent constant-currency).

First quarter 2018 net income increased 25 percent to a record $45.1 million, or $0.64 per diluted share, compared with first quarter 2017 net income of $36.0 million, or $0.51 per diluted share. Non-GAAP first quarter 2018 net income increased 48 percent to $54.5 million, or $0.77 per diluted share, compared with non-GAAP first quarter 2017 net income of $36.9 million, or $0.52 per diluted share.

President and Chief Executive Officer Tim Boyle commented, "We are pleased to report better than expected first quarter net sales and profitability led by strength in our direct-to-consumer (\"DTC\") businesses, growth in our wholesale businesses, including a return to growth in U.S. wholesale, and the favorable effect of strengthening foreign currencies relative to the U.S. dollar. Gross margin exceeded expectations, and we maintained SG&A discipline while continuing to invest in our strategic priorities."

"We are also pleased to increase our full year 2018 financial outlook as a result of better than expected first quarter net sales and profitability, higher than initially planned Fall 2018 advance wholesale orders, including continued improvement in U.S. wholesale net sales across all of our brands, and the favorable effect of strengthening foreign currencies relative to the U.S. dollar. When considering our plans for the balance of the year, we have made the decision to accelerate investment in our strategic priorities."

"First quarter 2018 net sales and earnings results, as well as healthy advance orders for Fall 2018 across our regions demonstrate the power of our global brands and our initiatives to become a more brand-led and consumer-focused organization. Our powerful balance sheet, with $808.2 million in cash and short-term investments, and no long-term debt, provides the flexibility to invest in the business as our major markets evolve. It is from this position of strength and confidence that we are accelerating investment in our strategic priorities to:

• drive brand awareness and sales growth through increased, focused demand creation investments;
• enhance consumer experience and digital capabilities in all our channels and geographies;
• expand and improve global direct-to-consumer operations with supporting processes and systems; and
• invest in our people and optimize our organization across our portfolio of brands."

GUIDANCE:

Columbia Sportswear sees FY2018 EPS of $3.27-$3.37, versus the consensus of $3.23.

For earnings history and earnings-related data on Columbia Sportswear (COLM) click here.

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