The growth in Under Armour's sales accelerated to 36.0 percent in the first quarter of this year, with increases of 33 percent in apparel, 41 percent in footwear, 43 percent in accessories and 79 percent in the company's international business. However, the company's revenues outside the U.S. remained relatively marginal at 9 percent of its total turnover of $641.6 million in the quarter, which included 81.8 percent higher licensing revenues of $16.8 million.
The company's acquisition of the distribution in Mexico and its expansion into Chile and Brazil contributed to its strong performance in foreign markets, but Under Armour also reported strong gains across Europe and Asia. Brand awareness doubled in Germany and France as compared to one year ago, and it grew three times in the U.K., partly because of the sponsorship of the Tottenham Hotspurs soccer team. While concentrating on these three markets, the company plans to move its European e-commerce business from third-party logistics to an in-house solution.
In China, where the brand is focusing on store franchising, the number of corporate and franchised stores is expected to grow to 50 from the present 20 by the end of this year, covering ten regional markets instead of only two. Under Armour's Japanese licensee, whose sales went up by more than 50 percent during the quarter, is anchoring the brand's development in Asia, where new distribution agreements are being signed.
Globally, the company's biggest segment, apparel, reached a turnover of $459 million in the quarter through expanded offerings in golf, hunting, training, studio and baseball. The golf category, which has been particularly successful in the U.K., already approached a turnover of $100 million in 2013.
In footwear, the growth in the latest quarter was driven by new product introductions in running such as the SpeedForm Apollo shoe.
The good results led the company to post a 73.3 percent jump in quarterly net earnings to $13.5 million, exceeding analysts' estimates, with an increase in the gross margin to 46.9 percent from 45.9 percent offsetting an increase in the marketing spend to 13.7 percent of sales from 13.1 percent a year ago.
They also led the management to improve its forecast for the full financial year. Operating earnings, which more than doubled to $27 million in the first quarter, should grow to a range of $331 million to $334 million for the year. With revenues rising by between 24 and 25 percent, sales should reach a level of between $2.88 billion and $2.91 billion.
The release of the quarterly results coincided with the opening in New York of Under Armour's biggest Brand House.
