-=Under Armour (UAA) reported earnings on Tue 12 Feb 2019 (b/o)

Under Armour beats by $0.05, reports revs in-line; reaffirms FY19 EPS guidance, revs guidance

• Reports Q4 (Dec) earnings of $0.09 per share, excluding non-recurring items, $0.05 better than the S&P Capital IQ Consensus of $0.04; revenues rose 1.5% year/year to $1.39 bln vs the $1.38 bln S&P Capital IQ Consensus.
  • Wholesale revenue increased 1 percent to $737 million and direct-to-consumer revenue was flat at $577 million, representing 41 percent of total revenue.
  • North America revenue decreased 6 percent to $965 million and international business increased 24 percent to $395 million (up 28 percent currency neutral), representing 28 percent of total revenue.
    • Within the international business, revenue was up 32 percent in EMEA (up 35 percent currency neutral), up 35 percent inAsia-Pacific (up 39 percent currency neutral), and down 15 percent in Latin America (down 11 percent currency neutral).
  • Apparel revenue increased 2 percent to $970 million with growth in the train category. Footwear revenue decreased 4 percent to $235 million primarily driven by lower sales to the off-price channel.
  • adjusted gross margin increased 160 basis points to 45.1 percent compared to the prior year driven predominantly by regional and channel mix, product cost improvements, lower promotional activity, and lower air freight partially offset by changes in foreign currency
  • Inventory decreased 12 percent to $1.0 billion
• Co reaffirms guidance for FY19, sees EPS of $0.31-0.33 vs. $0.33 S&P Capital IQ Consensus.
  • Revenue is expected to increase approximately 3 to 4 percent reflecting relatively flat results for North America and a low double-digit percentage rate increase in the international business. 
  • Gross margin is expected to improve approximately 60 to 80 basis points compared to 2018 adjusted gross margin due to channel mix benefits from lower planned sales to the off-price channel and a higher percentage of direct-to-consumer sales along with more favorable product costs due to ongoing supply chain initiatives.
  • Capital expenditures are planned at approximately $210 million.