The US outdoor outfitter Columbia Sportswear Company suffered significant losses in sales in the final quarter of the 2023 financial year.
The prospects for 2024 are not exactly rosy either: he expects a “difficult year” due to the reluctance of trading partners and major economic and geopolitical uncertainties, admitted CEO Tim Boyle in a statement published on Thursday evening.
Net profit shrank by almost 26 percent in the final quarter
In the fourth quarter of 2023, the parent company of the brands Columbia, Mountain Hardwear, Sorel and Prana generated sales of 1.06 billion US dollars (974.3 million euros). This corresponded to a decline of nine percent (-10 percent adjusted for currency effects) compared to the same period last year. The company attributed the losses to postponed delivery dates in the wholesale business and lower sales in US retail.
The operating result shrank by 27.2 percent to 113.1 million US dollars, which was not least due to the fact that impairments of 25.0 million US dollars were made on the Prana label. Net profit fell by 25.7 percent and reached $93.3 million (85.8 million euros).
The group predicts a decline in sales and profits for 2024 and has announced cost-cutting measures
For the entire 2023 financial year, consolidated sales amounted to 3.49 billion US dollars and exceeded the previous year’s level by one percent (currency-adjusted +1 percent). Net income fell 19.3 percent to $251.4 million.
For 2024, management now expects a decline in sales of 2.0 to 4.0 percent to between 3.35 and 3.42 billion US dollars. The company also forecast a lower operating margin and a decline in net income to between $207 million and $231 million.
In view of the difficult situation, CEO Boyle announced an austerity program that would last several years. The aim of the measures is to reduce the annual cost burden by 125 to 150 million US dollars by 2026, he explained.