Columbia posts wider Q2 loss
Normally its weakest annual sales quarter, Columbia Sportswear (Nasdaq: COLM) said its sales dropped 16 percent and it posted a nearly $10 million loss for the second quarter.
For the quarter ended June 30, its loss was $9.9 million, or $0.29 per share, on $179.2 million in sales. The company said 4 percent of that loss was from unfavorable currency exchange rates. In the same quarter last year, Columbia reported a loss of $1.8 million, or $0.05 per share, on $213.1 million in sales.
“Our net loss for the second quarter, our smallest revenue quarter of the year, was slightly better than the outlook we gave in April, primarily due to a smaller decline in net sales than anticipated, combined with the positive effect of the cost control measures we’ve implemented over the past year,” said Tim Boyle, Columbia’s president and CEO, in a statement.
Geographically, Columbia had the biggest declines in its Europe, Middle East and Asia region, where sales fell 47 percent, followed by a 44 percent decline in Canada.
Those declines were offset by modest performances in the U.S., where sales increased 2 percent for the quarter, and the Latin America and Asia Pacific region, where sales were flat.
Sportswear net sales decreased 15 percent to $98.4 million, while footwear net sales decreased 21 percent to $33.4 million. Outerwear net sales declined 16 percent to $35.1 million. Accessories and equipment net sales declined 8 percent to $12.3 million.
Columbia brand net sales, which accounted for approximately 90 percent of consolidated second-quarter net sales, declined 17 percent to $162.0 million. Combined, Mountain Hardwear, Sorel and Montrail brand net sales declined $1.8 million, or 9 percent, to $17.2 million.
The company reaffirmed its previous expectation for total 2009 net sales to decline in the low double-digits on a percentage basis compared with 2008, which assumes a 3-percentage-point negative currency effect.
The company expects a low double-digit percentage decline in third-quarter 2009 net sales compared with the third quarter of 2008.
The board of directors approved a dividend of $0.16 per share, payable on Aug. 27 to shareholders of record on Aug. 13.
Timberland’s Q2 loss widens, revenue down 14.4 percent
For the second quarter, Timberland (NYSE: TBL), parent of SmartWool, posted a wider-than-expected loss, hurt by weakness in its casual footwear and apparel business and a stronger U.S. dollar. Its revenue also dropped 14.4 percent.
Net loss was $19.2 million, or a loss of $0.34 per share, versus a net loss of $18.9 million, or a loss of $0.32 per share, for the same period last year.
Revenue was $179.7 million for the quarter compared to $209.9 million last year, reflecting declines in Timberland brand apparel and casual footwear.
Foreign exchange rate changes decreased second-quarter 2009 revenue by approximately $11 million, or 5.3 percent, due to the strengthening of the U.S. dollar relative to the British Pound and the Euro.
North America revenue declined 13.3 percent to $86.3 million, reflecting soft consumer spending in the U.S. Europe revenue decreased 16.6 percent to $65.7 million but was down only 2.5 percent on a constant dollar basis.
Global footwear revenue was down 11.2 percent to $127.0 million, primarily due to declines in the casual footwear business, which offset strength in the boots business in the European and Asian markets. Apparel and accessories revenue decreased 24.6 percent to $47.2 million, primarily due to softness in the European market.
Global wholesale revenue decreased 20.3 percent to $108.4 million. Worldwide consumer direct revenue decreased 3.5 percent to $71.3 million.
Operating loss for the second quarter of 2009 was $36.4 million, compared to a loss of $30.0 million in the prior year period.
Looking ahead, Timberland anticipates that the back half of 2009 will continue to be challenging due to the low levels of consumer confidence and the financial health of the global economy. Given the continued volatile nature of current economic conditions, it continues to believe there is not sufficient visibility to set expectations for the remainder of 2009.
In other company news, Timberland said Mark Bryden has been named Timberland’s vice president and general manager of North America, responsible for all marketing, retail, wholesale and ecommerce business. For the last three years, he has been president and general manager of SmartWool, which was acquired by Timberland in 2005.
Mark Satkiewicz, formerly SmartWool’s vice president of sales, has been promoted to fill the role of president and general manager vacated by Bryden. Satkiewicz will be responsible for the oversight and strategic direction of the SmartWool global brand. He joined SmartWool in June 2006, following more than 10 years of sales and analysis experience in the athletic market.
Luxottica sales up 3.5 percent for Q2
Luxottica Group S.p.A. (NYSE: LUX), parent of Oakley, saw a second-quarter increase in sales as its Ray-Ban and Oakley brands posted growth in sales in both the sun and optical businesses not only for the quarter but also for the trailing 12 months, which was the most difficult portion of the global economic downturn.
In the second quarter of 2009, group sales grew to EUR 1.40 billion (USD $1.99 billion) from EUR 1.35 billion (USD $1.92 billion) — up by 3.5 percent at current exchange rates, down by 3.3 percent at constant exchange rates.
In terms of operating performance, EBITDA for the quarter was down year-over-year by 5.9 percent, to EUR 277.3 million (USD $394.7 million), from EUR 294.7 million (USD $419.5 million) in 2008.
Operating income for the quarter was EUR 206.0 million (USD $293.2 million), reflecting a decline by 10.5 percent from EUR 230.2 million (USD $327.7 million) for the same period in the previous year.
Net income was EUR 115.7 million (USD $164.7 million), a decline by 12.7 percent from EUR 132.6 million (USD $188.7 million) last year. Earnings per share were EUR 0.25 (USD $0.35$), which declined 12.9 percent over the second quarter of 2008. In Euro, the decline in EPS before trademark amortization would have been limited to 11.4 percent.
Luxottica said there are considerable differences between geographic regions: North America is still negative but now more stable than during the first few months of the year; Europe is improving, thanks above all to good weather; and key emerging markets continue to be positive overall.
Net sales for the wholesale division during the quarter were EUR 576.3 million (USD $820.4 million) from EUR 583.4 million (USD $830.5 million) for the second quarter of 2008 — down by 1.2 percent at current exchange rates and by 3 percent at constant exchange rates. Operating income for the quarter was EUR 129.8 million (USD $184.7 million) — down by 12.1 percent, from EUR 147.7 million (USD $210.2 million) for the second quarter of 2008. Operating margin for the quarter was 22.5 percent, compared with 25.3 percent for the same quarter last year.
Net sales for the quarter at the retail division rose to EUR 825.3 million (USD $1.17 billion), from EUR 771.1 million (USD $1.097 billion) in the second quarter of 2008 — up by 7.0 percent at current exchange rates, down by 3.4 percent at constant exchange rates. The division’s operating income for the quarter was EUR 115.9 million (USD $164.9 million), compared with EUR 119.6 million (USD $170.2 million) for last year’s second quarter (down by 3.0 percent). Operating margin declined to 14.0 percent for the quarter, from 15.5 percent in the same period last year.
(Conversion of Euros into U.S. dollars is for information only, is not necessarily relative to earnings, and is based on the currency rate as of July 28.)
Under Armour’s Q2 profit up 5 percent
Under Armour said its second-quarter profit rose 5 percent, aided by strong sales of apparel and lower marketing expenses.
Quarterly profit increased 5 percent to $1.44 million, or $0.03 per share, from $1.38 million, or $0.03 per share last year. There were 50.6 million outstanding shares in the quarter, compared with 50.3 million a year ago.
Revenue rose 5 percent to $164.6 million from $156.7 million a year ago.
Apparel revenue rose nearly 17 percent to $112 million, while footwear revenue fell about 19 percent to $37.5 million. The company said the decline in footwear was expected since the company launched its Performance Training footwear in May 2008.
Looking ahead, it expects 2009 earnings of $0.80 to $0.82 per share, on revenue of $810 million.
Hanesbrands reports dip in Q2 sales
Putting a positive spin on an 8-percent drop in second-quarter sales, Hanesbrands (NYSE: HBI), parent of Duofold, said the decline was better than the decline rate of the past two sequential quarters, which were also impacted by the recession.
Total net sales in the second quarter were $986.0 million, compared with $1.07 billion a year ago, while GAAP earnings per diluted share were $0.32, compared with $0.60 in the year-ago second quarter. Excluding restructuring and other actions, non-GAAP earnings per diluted share in the second quarter were $0.42, compared with $0.65 a year ago.
The company said its outerwear segment sales experienced the significant trend improvement that the company anticipated. Second-quarter outerwear sales declined by 11 percent, compared with the first quarter’s 21 percent decline. Based on the strength of advance orders, especially fleece, the company expects continued sequential improvement in the segment’s sales decline rate with third-quarter sales expected to decline in the mid-single digits or better.
Q2 sales down for GSI Commerce
GSI Commerce (Nasdaq: GSIC), a provider of e-commerce services, reported that its second-quarter net revenues decreased to $187.2 million from $193.2 million last year.
Net loss was $13.1 million, or $0.27 per share, compared to a net loss $20.3 million, or $0.43 per share. Loss from operations was $12.3 million compared to a loss from operations of $17.4 million.
“Net revenues and non-GAAP net revenues topped our expectations in the second quarter with revenues in both our e-commerce services and marketing services segments exceeding our plans,” said Michael Rubin, chairman, president and CEO of GSI, in a statement. “Between business already signed and our current strong pipeline we believe we are on track to have a great year for new business and we are confident in our prospects for the balance of 2009 and beyond.”
–Compiled by Wendy Geister
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