30/10/2013

Business news : VF Reports Third Quarter 2013 Results, Increases Dividend by 21 Percent and Announces Four-for-One Stock Split

GREENSBORO, N.C.–VF Corporation (NYSE:VFC) today reported financial results for its third quarter ended Sept. 28, 2013. All per share amounts are presented on a diluted basis.

“Adjusted” amounts refer to non-GAAP measures as described in the “Adjusted Amounts” paragraph at the end of this news release.

“VF is at its best when we empower our brands to deliver innovative products, connect with consumers, and operate with efficiency and discipline,” said Eric Wiseman, VF Chairman and Chief Executive Officer. “Our third quarter results validate our growth strategy and our ability to deliver strong results in a challenging economic environment.”

“Our solid year-to-date results allow us to make significant, incremental brand investments while still delivering on our long-term earnings growth target,” continued Wiseman. “The announced 21 percent increase in our dividend and stock split demonstrate the confidence we have in our ability to consistently generate strong returns for VF shareholders.”

Third Quarter 2013 Review

Revenues rose 5 percent to $3.3 billion, compared with the same period of 2012, led by Outdoor & Action Sports, Jeanswear, and our International and Direct-to-Consumer businesses. Changes in foreign currency exchange rates positively impacted total reported revenue growth by approximately one percentage point during the quarter.

Gross margin improved 90 basis points to 47.6 percent, compared with 46.7 percent in the same period of 2012. With improvements in nearly every coalition, the higher gross margin reflects the continuing shift in our revenue mix toward higher margin businesses and moderately lower year-over-year product costs.

SG&A as a percent of revenues rose 40 basis points to 30 percent in the third quarter. This increase includes an 80 basis point impact from higher marketing investments to support our largest and fastest growing businesses.

Operating income on an adjusted basis grew 6 percent to $582 million in the third quarter, compared with $551 million in the same period of 2012. On a GAAP basis, third quarter operating income increased 8 percent to $580 million, compared with $537 million in last year’s same period.  

Adjusted operating margin was 17.7 percent, compared with 17.5 percent in the third quarter of 2012. On a GAAP basis, operating margin rose to 17.6 percent from 17.1 percent in last year’s period.

Net income on an adjusted basis grew 11 percent to $436 million in the third quarter, compared with $393 million in the same period of 2012.  

Adjusted earnings per share – which excludes items related to the acquisition of The Timberland Company (“Timberland”) of $0.02 per share in the third quarter – increased 11 percent to $3.91 per share from $3.52 per share during the same period last year. Last year’s third quarter adjusted earnings per share of $3.52 excluded $0.10 per share in Timberland acquisition-related expenses. On a GAAP basis, third quarter net income was up 14 percent to $434 million or $3.89 per share.

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Business news : Under Armour's Q3 Net Jumps 27 Percent

Under Armour Inc. reported earnings rose 26.9 percent  in its third quarter ended Sept. 30, to $72.8 million, or 68 cents a share, exceeding Wall Street's consensus estimate of 66 cents. Revenues jumped 25.7 percent to $723.1 million, led by strong double-digit growth across categories. The company again raised its outlook for the year.

Third quarter apparel net revenues increased 26 percent to $561 million compared with $445 million in the same period of the prior year, primarily driven by the continued expansions of the Storm and Charged Cotton platforms, as well as the introduction of ColdGear Infrared technology.  Third quarter footwear net revenues increased 28 percent to $81 million from $63 million in the prior year's period, led by strong gains in both running and football.  Third quarter accessories net revenues increased 18 percent to $64 million from $54 million in the prior year's period, primarily driven by bags and headwear.  Direct-to-Consumer net revenues, which represented 25 percent of total net revenues for the third quarter, grew 34 percent year-over-year.

Kevin Plank, Chairman and CEO of Under Armour, Inc., stated, "We have a consistent formula that is driving success across our business:  deliver newness and innovation and the consumer responds.  This has been instrumental in driving net revenue growth in excess of 20 percent for the past fourteen straight quarters and we will continue to fuel this strategy going forward.  During the quarter we introduced our latest apparel innovation, ColdGear Infrared, which utilizes a ceramic thermo-conductive inner coating to absorb and retain body heat.  With the limited release of Speedform we also provided a glimpse of where we can take footwear and redefine fit in the category."

Gross margin for the third quarter of 2013 was 48.4 percent compared with 48.7 percent in the prior year's quarter, primarily reflecting higher import duties, partially offset by the net impact of lapping the prior year's sourcing challenges.  Selling, general and administrative expenses as a percentage of net revenues were 31.7 percent in the third quarter of 2013 compared with 32.9 percent in the prior year's period, primarily reflecting leverage of marketing expenses.  Third quarter operating income increased to $121 million compared with $91 million in the prior year's
period. 

Balance Sheet Highlights

Cash and cash equivalents increased 19 percent to $186 million at September 30, 2013 compared with $157 million at September 30, 2012.  Inventory at September 30, 2013 increased 59 percent to $497 million compared with $312 million at September 30, 2012.  Long-term debt decreased to $54 million at September 30, 2013 from $72 million at September 30, 2012.

Updated 2013 Outlook

The company had previously anticipated 2013 net revenues in the range of $2.23 billion to $2.25 billion, representing growth of 22 percent to 23 percent over 2012, and 2013 operating income in the range of $258 million to $260 million, representing growth of 24 percent to 25 percent over 2012.  Based on current visibility, the company now expects 2013 net revenues of approximately $2.26 billion, representing growth of 23 percent over 2012, and 2013 operating income of approximately $260 million, representing growth of 25 percent over 2012.  The company continues to anticipate an effective tax rate of 40.0 percent to 41.0 percent for the full year, compared to 36.7 percent for 2012.  The company now anticipates fully diluted weighted average shares outstanding of approximately 108 million for 2013.

Plank concluded, "The sustained momentum we are generating domestically will help fuel our global ambitions.  Many of these global efforts are ramping up with recent specialty stores opening in China, Japan and Mexico, e-commerce platforms launching in Hong Kong and Taiwan, and new offices opening in Brasil and Chile.  Moreover, we are better aligning our internal leadership to help capitalize on these global opportunities, while also adding talent across our direct-to-consumer businesses.  We have never been better positioned to take the Under Armour performance story to athletes around the world."


By press release through sportsonesource


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29/10/2013

Business people : Kevin Farr Appointed to Polaris Industries Inc. Board of Directors

MINNEAPOLIS, MN – October 25, 2013 – Polaris Industries Inc. (NYSE: PII) today appointed Kevin Farr to the Company’s Board of Directors. Mr. Farr is the Executive Vice President and Chief Financial Officer for Mattel, Inc., the worldwide leader in the design, manufacture and marketing of toys and family products. At Mattel, Mr. Farr is responsible for the finances of a $6.4 billion global business. He also plays integral roles in corporate strategic planning and development, including mergers and acquisitions, as well as corporate communications and government affairs.

“We are excited for Kevin Farr to bring his unique blend of financial acumen, business development and corporate strategy experience to our Board of Directors,” said Polaris Chairman and CEO Scott Wine. “Kevin honed these skills while managing critical elements of Mattel’s global consumer product business, particularly financial operations. He will provide invaluable oversight as we continue to strengthen and grow Polaris as a global brand.”

Prior to his time at Mattel, Mr. Farr worked for 10 years as a senior manager at PricewaterhouseCoopers International.

Mr. Farr is a Certified Public Account and holds a B.S. in Accounting from Michigan State. He also earned an M.B.A. in Finance and Marketing from the prestigious Kellogg Graduate School of Management at Northwestern University. He serves on the Corporate Advisory Board of the Marshall School of Business at the University of Southern California and is active in a number of professional organizations, including the American Institute of CPAs and the California Society of CPAs.

About Polaris

Polaris is a recognized leader in the powersports industry with annual 2012 sales of $3.2 billion. Polaris designs, engineers, manufactures and markets innovative, high quality off-road vehicles, including all-terrain vehicles (ATVs) and the Polaris RANGER® and RZR® side-by-side vehicles, snowmobiles, motorcycles and small vehicles.

Polaris is among the global sales leaders for both snowmobiles and off-road vehicles and has established a presence in the heavyweight cruiser and touring motorcycle market with the Victory and Indian motorcycle brands. Additionally, Polaris continues to invest in the global on-road small vehicle industry with Global Electric Motorcars (GEM), Goupil Industrie SA, Aixam Mega S.A.S., and internally developed vehicles. Polaris enhances the riding experience with a complete line of Polaris and KLIM branded apparel and Polaris accessories and parts.

Polaris Industries Inc. trades on the New York Stock Exchange under the symbol “PII”, and the Company is included in the S&P Mid-Cap 400 stock price index.

Information about the complete line of Polaris products, apparel and vehicle accessories are available from authorized Polaris dealers or anytime at www.polaris.com.

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Sport event :Rip Curl and Channel Islands Surfboards partner on West Coast wetsuit and surfboard demo tour


Costa Mesa, CA (October 23, 2013): The defending SIMA Image Award winners for ‘Wetsuit of the Year’ and ‘Surfboard of the Year’, Rip Curl and Channel Islands Surfboards (respectively), will be embarking on a 6-stop demo tour to bring the world's best wetsuits and surfboards into the hands of surfers up and down the west coast starting this weekend.

From the latest generation of the world's fastest drying wetsuit, The Flash Bomb Plus, to the latest Channel Islands Surfboards models, the demos aim to give a FREE test drive of the most cutting edge surfing equipment to the general public.

Mutual Rip Curl and CI team riders, such as Taylor Knox, Dillon Perillo, and Tom Curren, will be making guest appearances at select stops. Additionally, we will be throwing out giveaways, as well as special retailer promotions at every stop of the Demo Tour.

The Demo Tour kicks off this weekend to predicted fun 2-3’ waves at Pleasure Point, Santa Cruz just before heading north on Sunday to Ocean Beach, San Francisco. For updated schedule and information, visit shop.ripcurl.com.

Rip Curl Wetsuits+ Channel Islands Surfboards DEMO Tour:

October 26: Pleasure Point, Santa Cruz | 8-12pm
October 27: Ocean Beach, San Francisco | 8-12pm
November 2: Seaside Reef, Solana Beach | 8-12pm
November 9: Ponto, South Carlsbad | 8-12pm
November 16: El Porto, Manhattan Beach | 8-12pm
November 23: Crystal Pier, Pacific Beach | 8-12pm

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Mobile app : The Nike SB Skate App: An App Above All Others

Five distinguishing features of Nike Skateboarding’s Skate App.

These days there’s no escaping the quote heard round the world; “There’s an app for that.” Finally there is an app that provides an innovative take on the future of skateboarding, taking the once fiercely local sport, to a global stage.

Fully iOS7 compatible, the Nike SB Skate App gives the user a truly innovative experience. Pro riders like Sean Malto, Paul Rodriguez, Alex Olson, Brain Anderson, Cory Kennedy, Lance Mountain, Omar Salazar, Shane O’Neill, Stefan Janoski, and Theotis Beasley are more available than ever—allowing users to interact and emulate the world’s top skaters. The new app gives young athletes the chance to learn directly from the pros they idolize and receive real-time tips on how to master key skills.

Features like multi-angle tilt-to-play video, YouTube dynamic uploading and streaming, gamification, Trick Tree, and the game of S.K.A.T.E., are all packaged in a 40-megabite-memory footprint, leaving space for music, photos and whatever else to be stored on your phone.

Multi-angle video:

The app leverages the iPhone’s accelerometer enabling multi-angle, multi-speed videos featuring Nike SB riders performing tricks from the basics and beyond. This gives users an unprecedented view of a trick and allows them to learn like never before.

Dynamic Uploading and Streaming:

Another never been done feature, the Nike SB App’s UGC video, does not live natively on the app, but is dynamically uploaded and streamed from the app’s YouTube page. This enables the app to be small in size, increases social shareability, and provides a natural app extension to the Nike SB App’s own Youtube page.



Game of S.K.A.T.E.:

The app’s Game of S.K.A.T.E. platform enables consumers to randomly challenge anyone, at anytime, anywhere in the world, connecting a virtual community of skaters.

Trick Tree:

The Trick Tree is a virtual index cataloging the taxonomy of skate tricks, allowing you to track, show-off, and catalogue every trick in your arsenal and giving you visibility to everyone else’s.

Gamification:

No other app tracks your skating progress like the Nike SB App. Based on the user’s Trick Tree executions, Pro Challenge completions, game of S.K.A.T.E. victories, and overall app engagement, badges are awarded and represent the user’s development within the app.
The Nike SB Skate App is available globally for free on iTunes®. Download the app here.


source Nike
 
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Business news : Puma's Revenues Slide in Q3

Puma's Q3 revenues slid 7.6 percent in the third quarter to £824.8 million ($1.14 bn) from £892.2 million, according to a revenue update from its parent, Kering. Puma’s sales for the quarter were down 0.8 percent on a comparable basis. The decline was due to lower footwear sales. Accessories and apparel were up 7 percent and 4 percent, respectively.

By country, Kering noted in its presentation with analysts that sales in North America, representing 20 percent of Puma's sales, grew 5 percent. In other regions, Western Europe (representing 34 percent of Puma's sales) was down 2 percent; Japan (8 percent), was down 6 percent; Asia Pacific (13 percent), slipped 1 percent; and Other Countries (25 percent) was also off 1 percent.

Kering noted that adverse currency impacts continued to weigh on sales performance, exacerbated by volatility in emerging market countries.

Kering said in its press release, “The Puma brand recorded improved retail sales (up 6 percent), driven by all of its directly operated distribution channels (stores, outlets, online sales).

Sales developed positively in North America, but remained under pressure in Western Europe. Sales of Apparel and Accessories grew over the quarter, while the Footwear category continued to be affected by challenging conditions in its main markets.

In the third quarter, Puma pressed ahead with the implementation of the brand’s Transformation Program, closing more underperforming stores, appointing a new creative director, introducing a new geographic organization, reducing the number of product references and optimizing the product development process.”

Sales at Kering's Sports & Lifestyle Division – including Puma as well as Cobra, Tretorn, Volcom and Electric – were down 7.6 percent to £896.2 million ($1.24 bn) from £969.7 million. Sales were down 0.9 percent on a comparable basis. Its Other Brands portion under the Sports & Lifestyle division had revenues of £71.4 million ($98.5 mm), down 7.9 percent from £77.5 million.

Kering noted that Volcom’s sales were up 2 percent, driven by strong sales of newly introduced footwear styles.

Kering's main business is its Luxury division, which includes Gucci, Bottega Veneta, Saint Laurent, Alexander McQueen, Balenciaga, Stella McCartney and several other high-end brands.

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Business news : Callaway Golf's Q3 Loss Narrows

Callaway Golf Co. reduced its loss in the third quarter to $22.9 million, or 32 cents a share, from $89.2 million, or $1.19, a year ago. Revenues grew 38 percent to $178.2 million from $147.9 million.
Callaway said its results include sales growth as well as significant improvements in gross margins, operating expenses, and earnings for the third quarter and year to date, both on a GAAP and non-GAAP basis. These financial results reflect the continued success of the company's turnaround plan, including continued improvement in the development of more exciting and performance-oriented products, brand momentum, operating efficiencies, and cost management.

The company was able to grow sales despite adverse changes in foreign currency rates and the sale in 2012 of the Top-Flite and Ben Hogan Brands and the transition to a licensing arrangement for apparel and footwear in North America.  The sale of these brands and licensing arrangements negatively impacted 2013 sales by approximately $53 million for the first nine months, and by approximately $9 million for the third quarter, compared to the same periods in 2012.  In addition, changes in foreign currency rates negatively affected 2013 net sales by approximately $32 million for the first nine months, and by approximately $14 million for the third quarter, as compared to the same periods in 2012. On a constant currency basis, the company's current business, which excludes the sold or licensed brands and businesses, achieved 13 percent sales growth for the first nine months of 2013, and 38 percent sales growth for the third quarter of 2013, compared to the same periods in 2012.

In addition to sales growth, the company's 2013 financial results also benefitted from increased operating efficiencies, and the continued success of the company's cost reduction initiatives, including a decrease in charges related to these initiatives in 2013.  As a result, the company reported significant improvements in earnings with non-GAAP diluted earnings/loss per share improving by $0.32 and $0.60, respectively, for the third quarter and first nine months of 2013 as compared to the same periods in 2012, and with GAAP earnings per share increasing even more.

GAAP results 
For the third quarter of 2013, the Company reported the following GAAP results:

Dollars in millions except per share amounts
2013
% of Sales
2012
% of Sales
Improvement / (Decline)
Net Sales
$178
-
$148
-
$30
Gross Profit
$59
33%
$4
3%
$55
Operating Expenses
$76
43%
$87
59%
$11
Operating Loss
($17)
(10%)
($83)
(56%)
$66
Net Loss
($21)
(12%)
($87)
(59%)
$66
Diluted loss per share
($0.32)
-
($1.33)
-
$1.01
For the first nine months of 2013, the Company reported the following GAAP results:
Dollars in millions except per share amounts
2013
% of Sales
2012
% of Sales
Improvement / (Decline)
Net Sales
$716
-
$714
-
$2
Gross Profit
$286
40%
$239
33%
$47
Operating Expenses
$251
35%
$284
40%
$33
Operating Income/Loss
$35
5%
($45)
(6%)
$80
Net Income/Loss
$31
4%
($52)
(7%)
$83
Diluted earnings/loss per share
$0.36
-
($0.91)
-
$1.27

NON-GAAP fINANCIAL RESULTS.

In addition to the Company's results prepared in accordance with GAAP, the Company has also provided additional information concerning its results on a non-GAAP basis. The manner in which the non-GAAP information is derived is discussed in more detail toward the end of this release and the Company has provided in the tables to this release a reconciliation of this non-GAAP information to the most directly comparable GAAP information.
For the third quarter of 2013, the Company reported the following non-GAAP results:

Dollars in millions except per share amounts
2013
% of Sales
2012
% of Sales
Improvement / (Decline)
Net Sales
$178
-
$148
-
$30
Gross Profit
$60
34%
$31
21%
$29
Operating Expenses
$75
42%
$79
53%
$4
Operating Loss
($15)
(9%)
($48)
(32%)
$33
Net Loss
($11)
(6%)
($31)
(21%)
$20
Diluted loss per share
($0.18)
-
($0.50)
-
$0.32
For the first nine months of 2013, the Company reported the following non-GAAP results:
Dollars in millions except per share amounts
2013
% of Sales
2012
% of Sales
Improvement / (Decline)
Net Sales
$716
-
$714
-
$2
Gross Profit
$293
41%
$267
37%
$26
Operating Expenses
$248
35%
$279
39%
$31
Operating Income/Loss
$45
6%
($12)
(2%)
$57
Net Income/Loss
$28
4%
($10)
(1%)
$38
Diluted earnings/loss per share
$0.33
-
($0.27)
-
$0.60

"We are pleased with our results for the third quarter and first nine months of the year," commented Chip Brewer, President and Chief Executive Officer. "Market conditions during the third quarter were better than we had anticipated as we entered the quarter, due in part to improvements in weather and rounds played in both Europe and the Americas.   These market conditions, along with continued gains in market share in our major markets and the realization of the benefits from the many actions we have taken over the past year to improve our operations and reduce our costs, have resulted in an increase in sales and operating income.  On a constant currency, continuing business basis for the third quarter and first nine months of 2013, sales increased 38 percent and 13 percent, respectively.  Likewise, non-GAAP operating income for the third quarter and first nine months of the year increased approximately $33 million and $57 million, respectively, compared to the same periods in 2012. Moreover, our inventory levels, both internally and at retail, are in good shape, positioning us well for the balance of this year and the start of the 2014 golf season."

"While we are pleased with our first nine months results, which provide evidence that our turnaround is working, we are fully aware that we have more work to do to return to acceptable levels of performance," continued Mr. Brewer. "As I mentioned when I started with Callaway, successful turnarounds take time and we did not expect to complete everything in only one year.  With that said, our turnaround is proceeding at or above our original expectations, particularly given the headwinds we experienced this year from unfavorable changes in foreign currency rates, adverse weather conditions, a very late start to the 2013 golf season, and higher than normal promotional activity in both North America and Europe. I remain optimistic about the opportunities that lie ahead for Callaway and look forward to reporting to you on our continued progress."

Business Outlook
Due to better than expected third quarter performance, the company is increasing its 2013 full year financial guidance as follows:
  • Net sales for the full year 2013 are currently estimated to be approximately $836 million, compared to previous guidance of $810-$820 million.  Net sales for full year 2012 were $834 million, which included sales of $60 million related to the brands and products that in 2012 were sold or transitioned to a third party model.  Excluding sales from the sold or transitioned businesses, the company estimates that net sales from its current business on a constant currency basis will increase by approximately 13 percent compared to 2012.
  • For the full year 2013, the company estimates non-GAAP pre-tax income of $2 million - $7 million, which based upon an assumed tax rate of 38.5 percent equates to an estimated non-GAAP net income within a range of $2 million to $4 million and non-GAAP diluted earnings/loss per share of ($0.03) to $0.01, including the impact of dividends paid on the company's outstanding convertible preferred stock. The company's prior guidance was for a non-GAAP pre-tax loss of $9 million to breakeven, which equated to a non-GAAP net loss of $6 million to breakeven, and a non-GAAP diluted loss per share range of ($0.12) to ($0.04). For the full year 2012, the company's non-GAAP loss was $43 million with a non-GAAP diluted loss per share of ($0.77).*
*Note:  The non-GAAP estimates of earnings/loss exclude for 2013 carryover charges related to the company's 2012 cost-reduction initiatives and exclude for 2012 gains and charges related to the sale of the Top-Flite/Ben Hogan brands and the 2012 cost-reduction initiatives.  The non-GAAP estimates for both 2013 and 2012 are based upon an assumed tax rate of 38.5 percent for comparative purposes because the GAAP tax rates are not directly correlated to the company's pre-tax results due to the effect of the company's deferred tax valuation allowance.


Callaway Golf Company
Statements of Operations
(In thousands, except per share data)
(Unaudited)











Quarter Ended




September 30,




2013

2012







Net sales
$ 178,229

$ 147,906
Cost of sales
118,820

144,106
Gross profit
59,409

3,800
Operating expenses:




Selling 
49,871

60,273

General and administrative 
18,870

18,238

Research and development 
7,689

7,978


Total operating expenses
76,430

86,489
Loss from operations
(17,021)

(82,689)
Other expense, net
(3,095)

(3,359)
Loss before income taxes 
(20,116)

(86,048)
Income tax provision 
1,037

750
Net loss
(21,153)

(86,798)
Dividends on convertible preferred stock
1,766

2,414
Net loss allocable to common shareholders
$ (22,919)

$ (89,212)







Loss per common share:




Basic

($0.32)

($1.33)

Diluted
($0.32)

($1.33)
Weighted-average common shares outstanding:




Basic

72,649

67,162

Diluted
72,649

67,162








By press release.


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Business newxs : Columbia Sportswear Raises Dividend and Outlook Despite Lower Q3 Results

Columbia Sportswear Company reported net sales of $523.1 million for the quarter ended Sept.  30, a 4 percent decrease compared with net sales of $545.0 million for the same period in 2012, including a 1 percentage point negative effect from changes in currency exchange rates.

Third quarter net income totaled $54.6 million, or $1.57 per diluted share, compared with net income of $64.4 million, or $1.88 per diluted share, for the same period in 2012. A higher effective tax rate in the current quarter accounted for $2.2 million, or $0.06 per diluted share, of the decline.

“Our third quarter results benefited from strong performance across our direct-to-consumer platform while we continue to focus on reinvigorating growth in our wholesale channels globally,” said Tim Boyle, Columbia’s president and chief executive officer. “A 14 percent decline in inventory levels and our continued focus on managing discretionary spending also contributed to better-than-expected profitability and cash flow during the quarter, leading us to raise our financial outlook for 2013.

“These trends are encouraging and we’re very focused on several initiatives to return to growth in 2014, beginning with improved seasonal product assortments,” Boyle continued. “We also expect to generate growth through our new joint venture in China, grow and expand our direct-to-consumer operations, generate growth in our North American and European wholesale businesses, and grow in key international markets served by independent distributors. We also expect to implement our new global ERP platform in the U.S. in order to improve our business processes and financial performance.

With the above factors in mind, the board of directors approved a 14 percent increase in the company’s quarterly dividend, bringing it to $0.25 per share from the prior $0.22 per share rate.”

Third quarter results

(All comparisons are between third quarter 2013 and third quarter 2012, unless otherwise noted.)
Net sales in the U.S. declined 7 percent to $323.1 million; Latin America/Asia Pacific (LAAP) region net sales decreased 15 percent to $72.0 million, including a 9 percentage point negative effect from changes in currency exchange rates; Europe/Middle East/Africa (EMEA) region net sales increased 29 percent to $78.1 million, including a 4 percentage point benefit from changes in currency exchange rates; net sales in Canada decreased 4 percent to $49.9 million, including a 3 percentage point negative effect from changes in currency exchange rates.

Apparel, Accessories & Equipment net sales of $428.6 million were essentially unchanged, down less than 1 percent. Footwear net sales of $94.5 million declined 18 percent.

Columbia brand net sales decreased 1 percent to $431.5 million, Sorel brand net sales declined 23 percent to $47.4 million, and Mountain Hardwear net sales declined 9 percent to $40.6 million. (See “Brand Net Sales” table below.)

Balance sheet

The company ended the third quarter with $303.2 million in cash and short-term investments, compared with $96.3 million at Sept.  30, 2013. Approximately 47 percent of cash and short-term investments were held in foreign jurisdictions where a repatriation of those funds to the United States would likely result in a significant tax cost to the company.

Consolidated inventories totaled $410.1 million at Sept.  30, 2013, a reduction of $65.6 million, or 14 percent, compared with $475.7 million at Sept.  30, 2012. Reduced inventory purchases, primarily reflecting the planned later receipt of Fall inventory to be more aligned with delivery dates requested by wholesale customers, improved inventory management, and lower Fall 2013 advance wholesale orders.

Upward revised full year 2013 financial outlook

The company expects 2013 net sales to decline up to 1.5 percent compared to 2012, including an approximate 2 percentage point negative effect from anticipated changes in foreign currency exchange rates.

Full year 2013 gross margin is expected to improve by approximately 50 basis points compared to 2012.

Full year 2013 selling, general and administrative expenses are expected to increase approximately 2.0 percent, including approximately $3.7 million in pre-operating expenses related to the China joint venture and pre-tax restructuring charges of approximately $5.2 million, resulting in approximately 125 basis points of SG&A expense deleverage.

Full year 2013 licensing income is expected to be comparable to 2012, including the effect of deferring approximately $3.5 million of licensing income into 2014 in conjunction with the transition to the China joint venture.

As a result, full year 2013 operating margin is expected to be approximately 7.25 percent. Full year 2013 operating margin is expected to be approximately 8.1 percent if the following items are excluded: approximately $5.2 million in restructuring charges, the deferral of approximately $2.1 million of gross profit and $3.5 million of licensing income into 2014 and pre-operating costs of approximately $3.7 million related to the China joint venture.

The company is modeling a full year effective tax rate of 27.5 percent; however, the actual rate could differ based on the status of tax uncertainties, the geographic mix of pre-tax income, as well as other discrete events that may occur during the year.

Fourth quarter 2013 financial outlook

The company expects fourth quarter net sales to decline up to 2.0 percent compared with the fourth quarter of 2012. Fourth quarter operating margins are expected to contract approximately 220 basis points compared with the fourth quarter of 2012, consisting of approximately 290 basis points of SG&A deleverage and lower licensing income due to the deferral of approximately $2.0 million in licensing income related to the China JV transition, partially offset by anticipated gross margin expansion of approximately 90 basis points. Excluding a total of approximately $5.3 million of anticipated pre-operating costs and deferral of gross profit and licensing income related to the China joint venture, fourth quarter 2013 operating margin is expected to contract approximately 120 basis points. The company is modeling a fourth quarter effective tax rate of 27.0 percent.

The company’s annual net sales are weighted more heavily toward the second half of the fiscal year, while operating expenses are more equally distributed, resulting in a highly seasonal profitability pattern weighted toward the second half. All projections related to anticipated future results are forward-looking in nature and are subject to risks and uncertainties which may cause actual results to differ, perhaps significantly.

Dividend

The board of directors authorized a 14 percent increase in the company’s regular quarterly dividend to $0.25 per share from the prior $0.22 per share, payable on December 2, 2013 to shareholders of record on November 14, 2013.

COLUMBIA SPORTSWEAR COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)















Three Months Ended September 30,
Nine Months Ended September 30,


2013

2012

2013

2012
Net sales
$ 523,084

$ 545,005

$ 1,151,886

$ 1,168,503
Cost of sales

290,735


301,320


645,949


659,014
Gross profit

232,349


243,685


505,937


509,489



44.4 %

44.7 %

43.9 %

43.6 %













Selling, general and administrative expenses

162,951


160,154


437,789


437,881
Net licensing income

7,501


4,287


11,482


10,817
Income from operations

76,899


87,818


79,630


82,425













Interest income (expense), net

56


(17 )

403


421
Other non-operating income (expense)

417


-


(686 )

-
Income before income tax

77,372


87,801


79,347


82,846













Income tax expense

(22,822 )

(23,426 )

(22,025 )

(22,474 )
Net income

54,550


64,375


57,322


60,372
Net loss attributable to non-controlling interest

(36 )

-


(289 )

-
Net income attributable to











Columbia Sportswear Company
$ 54,586

$ 64,375

$ 57,611

$ 60,372













Earnings per share attributable to Columbia










Sportswear Company:











Basic
$ 1.58

$ 1.90

$ 1.68

$ 1.79
Diluted

1.57


1.88


1.66


1.77
Weighted average shares outstanding:










Basic

34,452


33,872


34,325


33,761
Diluted

34,753


34,155


34,640


34,035













COLUMBIA SPORTSWEAR COMPANY
(In millions, except percentage changes)
(Unaudited)



















Three Months Ended September 30,
Nine Months Ended September 30,





2013

2012
% Change

2013

2012
% Change















Geographical Net Sales:













United States

$ 323.1
$ 347.8
(7 )%
$ 663.4
$ 672.9
(1 )%

Latin America & Asia Pacific


72.0

84.7
(15 )%

236.3

245.6
(4 )%

Europe, Middle East, & Africa


78.1

60.5
29 %

172.1

168.6
2 %

Canada


49.9

52.0
(4 )%

80.1

81.4
(2 )%

Total

$ 523.1
$ 545.0
(4 )%
$ 1,151.9
$ 1,168.5
(1 )%















Categorical Net Sales:













Apparel, Accessories and Equipment

$ 428.6
$ 429.5
-

$ 958.6
$ 954.7
-

Footwear


94.5

115.5
(18 )%

193.3

213.8
(10 )%

Total

$ 523.1
$ 545.0
(4 )%
$ 1,151.9
$ 1,168.5
(1 )%















Brand Net Sales:













Columbia

$ 431.5
$ 436.8
(1 )%
$ 985.1
$ 990.6
(1 )%

Mountain Hardwear


40.6

44.4
(9 )%

95.2

98.8
(4 )%

Sorel


47.4

61.2
(23 )%

62.7

70.5
(11 )%

Other


3.6

2.6
38 %

8.9

8.6
3 %

Total

$ 523.1
$ 545.0
(4 )%
$ 1,151.9
$ 1,168.5
(1 )%

By press release