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Columbia Reports Record Results:
1998 Net income Up 34%
2/9/99
PORTLAND, Ore., Feb. 9 -- Columbia Sportswear Company(R)
(Nasdaq: COLM) a global leader in the active outdoor apparel industry,
today announced record fourth quarter net sales of $111.2 million for the
period ended December 31, 1998, an increase of 16.9% over net sales of
$95.1 million for the same period of 1997. The Company reported net
income for the period of $7.2 million, a 56.5% increase when compared to
the Company's pro forma net income of $4.6 million for the same period of
1997. Earnings per share for the fourth quarter of 1998 were $0.28
(diluted), on 25.6 million weighted average shares outstanding for the
period compared to pro forma earnings per share of $0.24 (diluted) on
19.1 million weighted average shares outstanding for the fourth quarter
of 1997. Growth in sales and earnings for the period were primarily
attributable to continued strength in the Company's European and Canadian
operations.
For 1998, the Company reported record net sales of $427.3 million, an
increase of 20.9% over net sales of $353.5 million for 1997. The Company
reported net income for 1998 of $32.7 million, a 34.0% increase when
compared to the Company's pro forma net income of $24.4 million for 1997.
Including a one-time tax benefit of $2.0 million which occurred in the
first quarter of 1998, earnings per share for 1998 were $1.36 (diluted),
on 24.1 million weighted average shares outstanding for the period,
compared to pro forma earnings per share of $1.28 (diluted) on 19.1
million weighted average shares outstanding for 1997.
For 1998, the Company's domestic, Canadian and international sales
increased 17.1%, 24.6%, and 48.5%, respectively, over 1997. Strong
domestic sell-through of spring sportswear in the first and second
quarters, and strength in the Company's European and Canadian operations
in the third and fourth quarters contributed to sales growth for the
year. These factors also positively affected earnings for 1998 compared
to 1997, as did the recording of a one-time $2.0 million deferred income
tax benefit upon conversion to a C corporate status in conjunction with
the Company's initial public offering in the first quarter of 1998.
Tim Boyle, Columbia's president and chief executive officer, commented,
"We are pleased to close 1998 strongly despite the unseasonably warm
weather in many parts of the country. Our outerwear inventory position
coming out of fall 1998 is appropriate and we are currently booking
business for fall 1999. However, given the warm weather during the fourth
quarter we are experiencing a slower than normal ordering pattern from
our domestic customers for the fall 1999 season. Although it is too early
to know with certainty where our fall business will end up, we feel that
it is prudent for us to plan for the domestic portion of the fall
business for 1999 to trend flat with 1998's domestic fall business.
Nevertheless, we believe that there is a potential for some sales growth
since customers are booking orders later this year. Given the potential
for slower than previously anticipated growth, we have recognized that
there must be an even greater focus on continually reviewing and
controlling expenses. Accordingly, we have started a process of
examiningour expense line items and have taken the initiative to further
improve cost controls as we move into 1999. Notwithstanding potential
pressure on the domestic fall business for 1999 we remain optimistic
about the sales growth prospects in Europe in all product categories as
well as our footwear and sportswear divisions globally."
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