Disappointing Q4 for Columbia

Columbia Sportswear Co. on Thursday posted double-digit declines in both fourth-quarter and full-year profits.

For the three months ended Dec. 31, profits were down 59.4 percent to $18.6 million, or 55 cents a diluted share, from $45.7 million, or 1.26, in the year-ago period. The results include a $24.7 million pretax, noncash charge, or 46 cents per share after tax, for the writedown of intangible assets in connection with the 2006 purchase of the Pacific Trail and Montrail brands.

Sales fell 5.8 percent to $354.9 million from $376.8 million. Sales in the U.S. were down 3 percent, while sales in Europe, the Middle East and Africa fell 21 percent and sales in Canada were down 12 percent. The declines were offset by a 6 percent gain in sales in the Latin America/Asian Pacific region.

In 2008, profits fell 34.2 percent to $95 million, or $2.74 a diluted share, from $144.5 million, or $3.96, from 2007. Sales dipped 2.8 percent to $1.32 billion from $1.36 billion.

Tim Boyle, Columbia’s president and CEO, boasted that the company “returned over $100 million to shareholders through share repurchases and dividends and ended the year with cash and short-term investments totaling over $250 million and zero debt.”

He said that the firm is pulling back on store opening plans and is adjusting marketing and advertising budgets due to the “accelerated deterioration of the global economy since September.” The opening of a branded store on Chicago’s Michigan Avenue this fall won’t be affected by the revised plans. The company also will continue opening outlet stores because they provide a “more profitable channel for inventory liquidation,” Boyle said.

The company said it expects first quarter 2009 sales to decline 10 percent to 12 percent. It also projects first quarter earnings per share at between 4 cents and 8 cents, compared with 56 cents in last year’s quarter.

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