Under Armour raises 2015 outlook following strong Q3

By

Barbara Santamaria

Published
Oct 23, 2015

The sports label Under Armour announced on Thursday its third quarter results. In the period ended September 30, it posted a net revenues rise to $1.20 billion, up 28% from net revenues of $938 million in the prior year's period. On a currency neutral basis, net revenues increased by 31%. 

Kevin Plank, Chairman and CEO of Under Armour stated: "Our scoreboard in the third quarter not only marked our 22nd straight quarter of at least 20% net revenue growth, but also our first $1 billion quarter. Our ongoing success in 2015 has been driven by innovative, head-to-toe product, combined with game-changing performances by our athletes.”

The company saw its net income increase by 13% in the third quarter of 2015 to $100 million, compared with $89 million in the same date last year. Diluted earnings per share for the third quarter of 2015 were $0.45 compared with $0.41 per share in the prior year's period, inclusive of the impacts of the Endomondo and MyFitnessPal acquisitions.

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Third quarter apparel net revenues increased by 23% to $866 million, while footwear net revenues rose  61% to $196 million reflecting continued product expansion across the running, basketball, and training categories. Accessories also grew by 22% to $104 million driven by new products.

International net revenues, which represented 11% of total net revenues for the third quarter, grew by 52% year-on-year.

Gross margin for the third quarter of 2015 was 48.8% compared with 49.6% in the prior year's period, primarily reflecting the impacts of foreign exchange rates and sales mix, partially offset by favorable product margins. Operating income also rose by 17% to $171 million compared with $146 million in the prior year's period.

Following the positive performance it recorded, Under Armour announced it has raised its 2015 guidance from $3.84 billion in net revenues to $3.91 billion. The sports label expects revenue growth of 27% over 2014, and 2015 operating income of approximately $408 million.