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Tuesday, February 13, 2018

=Under Armour (UAA) reported earnings on Tue 13 Feb 2018 (b/o)

Under Armour reports EPS in-line, beats on revs; guides FY18 EPS below consensus, rev in-line 
  • Reports Q4 (Dec) net of breakeven, excluding non-recurring items, in-line with the Capital IQ Consensus of ($0.00); revenues rose 4.6% year/year to $1.37 bln vs the $1.31 bln Capital IQ Consensus (up 4 percent currency neutral).
    • Revenue to wholesale customers declined 1 percent to $733 million and direct-to-consumer revenue was up 11 percent to $575 million. Direct-to-consumer represented 42 percent of global revenue in the quarter.
    • Consistent with previous expectations, revenue in North America was down 4 percent. Strong international momentum continued with revenue up 47 percent (up 43 percent currency neutral), representing 23 percent of total revenue. Within our international business, revenue in EMEA was up 45 percent (up 37 percent currency neutral), up 56 percent in Asia-Pacific (up 55 percent currency neutral) and up 36 percent in Latin America (up 34 percent currency neutral).
    • Apparel revenue increased 2 percent to $952 million, as growth in men's training and global football was tempered by declines in the team sports and outdoor categories. Footwear revenue was up 9 percent to $246 million, driven by strength in running, offset by team sports and basketball. Accessories revenue increased 6 percent to $111 million led by men's training and running.
  • Co issues downside guidance for FY18, sees EPS of $0.14-0.19, excluding non-recurring items, vs. $0.22 Capital IQ Consensus. Net revenue is expected to be up at a low single-digit percentage rate (vs. +3.3% consensus) reflecting a mid-single-digit decline in North America and international growth of greater than 25 percent. Gross margin is expected to increase ~50 basis points to 45.5 percent due to benefits from lower planned promotional activity, product costs, channel mix and changes in foreign currency. Operating income is expected to reach $20 million to $30 million. Excluding the impact of continued restructuring efforts, adjusted operating income is expected to be $130 to $160 million.  
  • Based on the restructuring efforts in 2017 and 2018, the company anticipates a minimum of $75 million in savings annually from these efforts in 2019 and beyond.

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