Under Armour Inc. said that based on preliminary estimates for the fourth quarter of 2008, it now anticipates net revenues in the range of $179 million to $180 million. Income from operations for the fourth quarter is estimated to be approximately $22 million to $24 million and diluted earnings per share is expected to be in the range of 16 cents to 18 cents a share.
Given these preliminary fourth quarter estimates, the company now expects full year 2008 revenues in the range of $725 million to $726 million compared with net revenues of $606.6 million in 2007, representing growth of approximately 20%. Full year 2008 income from operations is estimated to be approximately $76 million to $78 million compared with $86.3 million in 2007. Diluted earnings per share for 2008 is anticipated to be in the range of 76 cents to 78 cents a share compared with $1.05 for the full year in 2007. The company had previously anticipated 2008 net revenues in the range of $750 million to $765 million and 2008 income from operations in the range of $97.5 million to $104.5 million.
Fourth quarter 2008 net revenues were primarily impacted by lower than anticipated at-once orders and higher than anticipated cancellations in the U.S. wholesale business as well as lower than anticipated web sales, resulting from the weaker retail environment. The impact to fourth quarter income from operations and diluted earnings per share was primarily driven by the lower than expected sales volumes.
Cash and cash equivalents are estimated to be approximately $100 million at Dec. 31, 2008 compared with $40.6 million at Dec. 31, 2007. The Company has approximately $25 million in borrowings outstanding under its $100 million revolving credit facility at Dec. 31, 2008. Inventory at year-end, which includes approximately $15 million of running footwear to support the product launch on Jan. 31, 2009, is expected to increase approximately 10% from the balance reported at Dec. 31, 2007.
Kevin Plank, Chairman and CEO of Under Armour, Inc., stated, “We are a growth company, and we remain focused on developing and executing our strategy to deliver both near-term and long-term value for our shareholders. Our brand strength, connection with the consumer, and our demonstrated ability to generate excitement through the introduction of compelling performance products give us confidence in the opportunities ahead. Understanding the current environment, we will focus greater precision on cost management and prioritize our investments for the long-term growth of the Brand.”
