Under Armour Inc.’s net income saw healthy growth in the first quarter.
Earnings per share for the first quarter ended March 31 handily topped estimates, coming in at 23 cents, compared with 14 cents in the same period a year ago. Analysts were looking for 19 cents as polled by Yahoo Finance.
Net income for the period swelled 68 percent to $12.1 million, while net revenue increased 36 percent to $312.6 million.
Footwear played a sizable part of the increase, as sector sales advanced 20 percent to $51.4 million. Growth was predominantly driven by new basketball offerings, said Kevin Plank, president, chairman and CEO of Under Armour, during in a call with analysts.
Brad Dickerson, the firm’s CFO, predicted that the second and third quarters will see the “highest growth rate for footwear this year” and will be “driven by a run in baseball and … football.”
Plank also said the firm sees footwear as a longer-term investment.
“We’re seeing successful footwear that is coming on in the back half of this year. We’ve had some success with the Assault running shoe that’s coming out, and … we feel good about what the running category will look like [in the fall]. Really as we get into [2012 and 2013], we should have business coming on,” Plank added.
Strong performance was broad-based for the Baltimore-based firm, with apparel sales surging 34 percent to $230.5 million and accessories more than tripling to $23.5 million, driven mainly by the transition of previously licensed hats and bags to in-house.
Gross margin slipped due partly to increased footwear sourcing costs, although these were partially offset by lower sales returns in the category, according to the firm.
Under Armour ended the quarter with cash and cash equivalents of $110.8 million, down 33 percent from the same period a year earlier, and it reduced its long-term debt obligations by $2.3 million.