PORTLAND, Ore. - Columbia Sportswear Company (NASDAQ:COLM) reported a strong start to 2024, with first-quarter earnings and revenue surpassing analysts' expectations, and provided an optimistic full-year guidance that exceeded consensus estimates. The company's shares jumped 7.58% in response to the positive financial results and forward outlook.
For the first quarter ended March 31, 2024, Columbia Sportswear announced net sales of $770 million, a decrease of 6% compared to $820.6 million in the same quarter last year. Despite the drop, the company's sales figures were significantly higher than the analyst consensus of $741.68 million. Adjusted earnings per share (EPS) for the quarter came in at $0.71, which was $0.37 better than the consensus estimate of $0.34.
The decrease in net sales was attributed to lower wholesale net sales in the United States and Canada, driven by retailer cautiousness, a competitive environment, and soft consumer demand. However, gross margin saw an improvement, increasing 190 basis points to 50.6% of sales compared to 48.7% in the first quarter of 2023. This was mainly due to lower inbound freight costs and a favorable region and channel net sales mix.
Operating income for the quarter decreased by 21% to $44.7 million, or 5.8% of net sales, from $56.4 million, or 6.9% of net sales, in the first quarter of 2023. Net income also saw a decline of 8% to $42.3 million, or $0.71 per diluted share, compared to $46.2 million, or $0.74 per diluted share, in the prior year period.
Looking ahead, Columbia Sportswear provided a full-year 2024 financial outlook, expecting net sales to be between $3.35 and $3.42 billion, which aligns with the unchanged forecast of a 4.0 to 2.0 percent decline compared to 2023. The company anticipates operating income to be in the range of $259 to $291 million, with an operating margin between 7.7 to 8.5 percent. Adjusted EPS is projected to be between $3.65 and $4.05, a modest increase from the previous range of $3.45 to $3.85 and ahead of the analyst consensus of $3.66.
Tim Boyle, Chairman, President and Chief Executive Officer, stated, "2024 has started out broadly in line with our expectations. We are making good progress against our top priorities." He highlighted the company's strong financial position, with approximately $788 million in cash and short-term investments and no borrowings at quarter end. Boyle expressed confidence in the company's strategies and its ability to achieve significant long-term growth opportunities.
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