Columbia Sportswear Company saw fourth quarter net sales decrease 9 percent, or 10 percent constant-currency, to $1.06 billion from $1.17 billion for the corresponding period in 2022. The decline in net sales was said to primarily reflect earlier shipment of Fall 2023 wholesale orders in third quarter 2023 compared to late shipment of Fall 2022 wholesale orders in fourth quarter 2022, as well as lower U.S. direct-to-consumer (DTC) net sales.

Full Year 2023 Financial Results

  • Full-year 2023 net sales increased 1 percent (1 percent constant-currency) to $3.49 billion from $3.46 billion for full-year 2022.
  • Gross margin expanded 20 basis points to 49.6 percent of sales in 2023, compared to 49.4 percent of net sales in 2022.
  • SG&A expenses increased 9 percent to $1.42 billion, or 40.6 percent of net sales, in 2023, compared to $1.30 billion, or 37.7 percent of net sales, in 2022.
  • Impairment of goodwill and intangible assets included a $25.0 million charge related to Prana, compared to $35.6 million of charges related to Prana in 2022.
  • Operating income decreased 21 percent to $310.3 million, or 8.9 percent of net sales, in 2023, compared to operating income of $393.1 million, or 11.3 percent of net sales, in 2022.
  • Interest income, net was $13.7 million in 2023, compared to $2.7 million in 2022.
  • Income tax expense of $74.8 million resulted in an effective income tax rate of 22.9 percent, compared to income tax expense of $86.0 million, or an effective income tax rate of 21.6 percent, for the comparable period in 2022.
  • Net income decreased 19 percent to $251.4 million, or $4.09 per diluted share, in 2023, compared to net income of $311.4 million, or $4.95 per diluted share, in 2022.

Full Year 2024 Financial Outlook

  • Net sales are expected to decrease 4.0 to 2.0 percent, resulting in net sales of $3.35 billion to $3.42 billion, compared to $3.49 billion in 2023.
  • Gross margin is expected to expand 100 to 150 basis points to 50.6 to 51.1 percent of net sales from 49.6 percent of net sales in 2023.
  • SG&A expenses, as a percent of net sales, are expected to be 43.2 to 43.5 percent, compared to SG&A expenses as a percent of net sales of 40.6 percent in 2023.
  • Operating income is expected to be $256 to $288 million, resulting in an operating margin of 7.6 to 8.4 percent, compared to an operating margin of 8.9 percent in 2023.
  • Interest income, net is expected to be approximately $19 million.
  • Effective income tax rate is expected to be 24.0 to 25.0 percent.
  • Net income is expected to be $207 million to $231 million, resulting in diluted earnings per share of $3.45 to $3.85. This diluted earnings per share range is based on the estimated weighted average diluted shares outstanding of 60.1 million.

Photo courtesy Columbia Sportswear

For more details on the 2023 fourth quarter and full year, including details on cost cutting, brand details and regional details, see SGB Executive below:

EXEC: Columbia Cutting 3 to 5 Percent of U.S. HQ Staff on Lowered 2024 Outlook