Columbia Sportswear Company (NASDAQ:COLM) Q3 2018 Earnings Conference Call Transcript

Oct 25, 2018 • 05:00 pm ET


Columbia Sportswear Company (NASDAQ:COLM) Q3 2018 Earnings Conference Call Transcript


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Greetings, and welcome to the Columbia Sportswear Company Third Quarter Fiscal Year 2018 Financial Results Conference Call. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. (Operator Instructions) As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Andrew Burns, Director of Investor Relations. Please go ahead.

Andrew Shuler Burns

Good afternoon, and thanks for joining us to discuss Columbia Sportswear Company's third quarter results and updated outlook. In addition to the earnings release, we furnished an 8-K containing a detailed CFO commentary, explaining our results and assumptions behind our outlook. This CFO commentary is also available on our Investor Relations website,

With me on the call today are Chairman of the Board, Gert Boyle; President and Chief Executive Officer, Tim Boyle; Executive Vice President and Chief Operating Officer, Tom Cusick; Senior Vice President and Chief Financial Officer, Jim Swanson; and Executive Vice President and Chief Administrative Officer, Peter Bragdon.

Gert will start us off by covering the safe harbor reminder.

Gert Boyle

(Forward-Looking Cautionary Statements)

Andrew Shuler Burns

Thanks, Gert. I'd also like to point out that during the call, we may reference certain non-GAAP financial measures, including non-GAAP results, which exclude the effects of new accounting requirements associated with ASC 606 and insurance claim recovery benefit, program expenses and discrete costs associated with Project CONNECT, income tax charges associated with Tax Cuts and Jobs Act as well as constant currency sales growth. You'll find a reconciliation of these non-GAAP financial measures to comparable measures reported under U.S. GAAP in the supplemental financial tables that accompany our earnings release, along with an explanation of management's rationale for referencing these non-GAAP financial measures.

Following our prepared remarks, we will host a Q&A period, during which we will limit each caller to two questions, so we can get to everyone by the end of the hour.

Now I'll turn the call over to Tim.

Timothy Boyle

Thanks, Andrew. Welcome, everyone, and thanks for joining us this afternoon. So far, 2018 has been a great year for Columbia Sportswear Company and these results demonstrate our brand-led consumer focus strategy is working. For the quarter, we're elated to report record revenue and earnings that exceeded expectations. With strong year-to-date performance and ongoing business momentum, we are raising our full-year outlook. It's important to note that these results include significant investments in our business that are designed to help us adapt to the rapidly changing retail environment and fuel sustainable long-term profitable growth.

Non-GAAP sales increased 6% for the quarter adjusting for favorable impact of new revenue accounting standards. Non-GAAP net income increased 11% to $99.3 million or $1.41 per diluted share, compared to $1.28 per share in the comparable quarter last year. Year-to-date non-GAAP sales increased 10%, and year-to-date non-GAAP earnings per share of $2.34 is up 40% compared to the same period last year. Regionally, the United States business grew 9% in the quarter and year-to-date is up 11%, led by high teens