Under Armour finished last year with a buoyant quarter, lifting its sales by 33.9 percent to $403.1 million, with increases in all product categories. The rise was again driven by North America, where the brand's sales inflated by 35.3 percent, while they increased by 16.3 percent to just $26 million in other countries.
This means that international sales still make up just over 6 percent of Under Armour's sales, while its long-term target is to lift that rate to more than half of its turnover. The company said it would appoint a new international manager this year to push its foreign expansion.
Apparel sales climbed by 27.3 percent to $323.4 million for the quarter, but footwear continued to expand even faster, up by 42.8 percent to $31.3 million, partly owing to launches of Under Armour running footwear. Its sales of accessories even jumped by 149.4 percent to $36.8 million, as the company started making its own bags and hats at the start of last year, instead of licensing them out.
While the American company's gross margin slid by just 0.1 percentage point to 56.1 percent, its net income for the quarter was up by 42 percent to $32.5 million. Under Armour's margin declined in its U.S. wholesale business, and it was impacted by the switch to its own operations for hats and bags. On the other hand, it enjoyed a 50 percent increase in direct-to-consumer sales, which made up 38 percent of its turnover for the quarter.
Under Armour ended the full year with sales of $1,473 million, a jump of 38.4 percent. The company's gross margin for the full year dipped by 1.5 percentage points to 48.4 percent, for the same reasons as in the last quarter, and marketing and other expenses were reduced as a percentage of sales. Its net income of nearly $97 million amounted to an increase of 41.5 percent compared with the previous year.
However, analysts were taken aback that Under Armour adjusted its sales forecast for this year, predicting that its turnover should expand at a rate at the lower end of its 20 to 25 percent long-term growth target, while it had previously anticipated a growth rate at the higher end of this range. Under Armour does still expect to close 2012 with operating income growth at the higher end of its 20 to 25 percent long-term target.
