Net sales of US' Columbia Sportswear at $770 mn in Q1 FY24

Despite the dip in sales, the company saw an improvement in its gross margin, which increased by 190 basis points to 50.6 per cent of sales, up from 48.7 per cent in the first quarter of FY23. This rise indicates a stronger profitability per unit sold, contrasting with the overall drop in revenue.

Operating expenses remained relatively stable, with selling, general and administrative (SG&A) expenses slightly up at $349.3 million, or 45.4 per cent of net sales, compared to $347.4 million, or 42.3 per cent of net sales in the previous year. This change reflects a proportional increase due to the lower sales volume, the company said in a media release.

Operating income saw a significant reduction, decreasing 21 per cent to $44.7 million, which represents 5.8 per cent of net sales, down from 6.9 per cent in the corresponding period last year. The decline in operating income is a direct reflection of the challenges faced in maintaining sales volumes and managing operational costs.

Interest income for the quarter was a bright spot, with net income rising to $9.2 million from $3.3 million the previous year, attributed to higher yields on increased cash, cash equivalents, and short-term investments.

The company's net income fell by 8 per cent to $42.3 million, or $0.71 per diluted share, compared to $46.2 million, or $0.74 per diluted share, in the first quarter of FY23.

“2024 has started out broadly in line with our expectations. We are making good progress against our top priorities. Inventory exiting the quarter was down 37 per cent year-over-year, and our Profit Improvement Plan is on track to achieve our savings targets. Based on year-to-date results, we are reiterating our net sales outlook while modestly increasing our diluted EPS range,” said chairman, president and chief executive officer Tim Boyle.

Fibre2Fashion News Desk (DP)