Umbro Swings to Profit in Non-Tournament Year…

Umbro plc was able to swing to a profit in the 2005 fiscal year despite a sharp decline in total revenues and the lack of any key tournaments during the year. Operating earnings before exceptional items inched up 1.3% to £24.5 million ($45 mm), compared to £24.2 million ($44 mm) in the prior year. Umbro posted net income of £22.0 million in 2005, compared to a net loss of £11.8 million in the year-ago period.

Total revenues declined 12.4% to £123.0 million from £140.4 million in 2004. Wholesales sales were down 16.0% to £99.1 million from £118.0 million in the prior year, with branded apparel sales declining 5.1% to £11.4 million from £12.0 million in 2004 and licensed apparel falling 20.3% to £74.0 million in 2005 from £92.9 million in the tournament-aided results in 2004. Total apparel sales declined 18.6% to £85.3 million ($155 mm) from £104.8 million ($192 mm) a year ago. Footwear sales, which are less affected by the event business, grew 10.9% to £10.4 million from £9.4 million, while equipment and other sales declined 10.9% to £3.4 million from £3.8 million in 2004.

Total wholesale equivalent sales in the U.S. increased 63.3% to approximately $20 million, with 18% of sales coming from apparel, 78% from footwear, and another 4% from equipment. The majority of sales during the year were of branded footwear to the Foot Locker,Inc. group, which has a distribution agreement with Umbro. Management said soccer specialty store and catalog distribution order has also been established. Total U.S. pairage was estimated at 667,000 pairs in 2005 versus 264,000 pairs in 2004.