Due to the unstable situation in the U.S. retail market, Columbia Sportswear has slightly downgraded its guidance for the full financial year. It predicts that sales will gain 3 percent and that net profit will range from $192 million to $199 million, compared with sales of $2.38 billion and earnings of $192 million in 2016.
The group has lost about 800 stores among its clients in the last year and remaining retailers have generally become more cautious about orders in the winter business.
Columbia issued the adjusted forecast as it reported a sales increase of 4 percent to $543.8 million for the first quarter. U.S. sales were down by one percent to $333.2 million due to a drop in wholesale turnover, while the group's direct-to-consumer sales moved up.
Demand was robust outside of the U.S. market, with sales growth of 8 percent in Europe, the Middle East and Africa (EMEA) to $55.4 million, up by 10 percent in constant currencies. It was driven by the group's European subsidiaries, while sales to EMEA distributors declined. Columbia Sportswear's sales also gained 17 percent in Latin America and Asia Pacific and one percent in Canada in constant currencies.
In reported terms, sales were up by 3 percent for the Columbia brand, by 50 percent for Sorel and by 10 percent for Mountain Hardwear, while they slipped by 7 percent for Prana, which was most exposed to U.S. retail issues.
Columbia Sportswear's operating income advanced by 8 percent to a first-quarter record of $48.0 million and it ended the three months with net income of $36.0 million, up 13 percent. The group still expects to achieve growth in the U.S. market this year, with a low-single digit rise in own retail sales, driven by 13 store openings and online retailing.
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