US: Columbia Sportswear narrows Q2 net loss
Outdoor apparel and footwear specialist Columbia Sportswear has narrowed its net losses in the second quarter, despite incurring costs from its acquisition of prAna.
Net losses totalled US$6.3m in the three months to the end of June. This narrowed from $7.1m a year earlier and includes $3.4m of non-recurring transaction costs related to the prAna acquisition.
Gross margin increased 150 basis points versus RBC Capital Markets estimates for 40 basis points of erosion.
Net sales increased $43.7m, or 16%, to a second-quarter record $324.2m.
"We are very pleased with our performance through the first half of 2014 and anticipate strong Columbia and Sorel brand momentum in the second half, particularly in North America," said CEO Tim Boyle. "In addition, our brands continued to stabilise in the key Europe-direct markets that are a focal point of our ongoing efforts to drive renewed growth and improved profitability."
The company is expecting full-year net sales growth of 19-21% to between $2.01bn and $2.04bn, and EPS of around $3.22 to $3.38, including acquisition costs.
RBC Capital Markets analyst Howard Tubin says: " Columbia is approximately 60 days into the PrAna integration process after closing at the end of May. The inclusion of the PrAna brand, along with initiatives such as Omni-Freeze and PFG, is helping to create a more year-round relevance across Columbia's brand portfolio. The differentiation PrAna can offer is vital to generate momentum and create a multi-pronged appeal to fitness-lifestyle consumers."
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