Q3 sales for Amer Sports' Precor segment fall 24 percent
Hit by weak North American sales, Amer Sports reported an expected decline in company-wide net sales, but a lower-than expected sales drop of 24 percent for its Precor fitness segment.
For the third quarter, Amer Sports' net sales decreased 6 percent to EUR 433.2 million (USD $541.0 million) versus EUR 462.8 million (USD $578.0 million) in the same period last year. Net sales in local currency terms decreased 2 percent.
The group's earnings before interest and taxes amounted to EUR 51.5 million (USD $64.3 million) compared to EUR 59.1 million (USD $73.8 million).
Earnings before taxes were EUR 43.8 million (USD $54.7 million) down 15 percent from EUR 51.3 million (USD $64.0 million) in 2007. Earnings per share were EUR 0.45 (USD $0.56) versus EUR 0.53 (USD $0.66). Net financial expenses amounted to EUR 7.7 million (USD $9.6 million) compared to EUR 7.8 million (USD $9.7 million).
"Amer Sports' business developed in the third quarter according to our expectations except for the Fitness segment. The challenging conditions in the North American consumer market have continued to affect Precor's consumer business more than we previously anticipated, and we have experienced major difficulties in our dealer network," said Roger Talermo, CEO and president of Amer Sports, in a statement.
For the third quarter, Precor's net sales fell 24 percent to EUR 55.0 million (USD $68.6 million) versus EUR 72.3 million (USD $90.3 million) in the same period the year before. In local currencies, the decline was 18 percent.
Precor's EBIT plunged 65 percent from EUR 8.1 million (USD $10.1 million) last year to EUR 2.8 million (USD $3.4 million) this quarter. In local currencies, the change was a 63-percent drop.
The company said in a statement that challenging conditions in the North American consumer market continue to take their toll on Precor's consumer business. Demand and consumer traffic have dropped far below any level of expectation, it added. Precor's North American commercial business remained solid through the third quarter.
Amer said Precor's sales and opportunities in EMEA continued to grow in the third quarter, with record-setting revenues at the end of the quarter and further inroads into major club accounts.
For the group, Amer Sports revised its full-year guidance.
"Given the weak worldwide consumer confidence, Amer Sports' outlook is more uncertain than normally at this time of the year. With this in mind and as the last quarter is seasonally the strongest for Amer Sports, we currently anticipate full-year operating results to be between EUR 80 million to EUR 90 million (USD $99.9 million to USD $112.4 million)," Talermo said in a statement.
Previous guidance was EUR 90 million to EUR 105 million (USD $112.4 million to USD $131.1 million).
(Conversion of Euros into U.S. dollars is for information only, is not necessarily relative to earnings, and is based on the currency rate as of Oct. 28.)
Under Armour Q3 profit up 28 percent
Under Armour (NYSE: UA) said its third-quarter profit rose 28 percent, but the company lowered its full-year profit outlook in anticipation of a tough holiday shopping season that will affect the fourth quarter.
The company earned $25.7 million, or $0.51 per share, in the three months that ended Sept. 30. It earned $20 million, or $0.40 per share, in the same period a year ago.
Revenue rose 24 percent to $231.9 million.
Operating income rose 37.5 percent to $97.5 million in the third quarter.
Apparel net revenues for the third quarter rose 19.0 percent to $201.1 million compared with $169.0 million in the same period of the prior year. The women's business achieved the strongest percentage rate of growth during the quarter, increasing 27.5 percent to $50.3 million.
Footwear revenues increased to $13.1 million from $2.2 million in the third quarter of 2007, primarily driven by its performance training footwear, which launched during the second quarter of 2008.
The current financial turmoil led the company to be more cautious of how it will perform in the final months of the year. For the full year, the company lowered its revenue estimate to a range of $750 million to $765 million, an increase of 24 percent to 26 percent over 2007. It had previously predicted revenue would be $765 million to $775 million.
The company also lowered its guidance for operating income to a range of $97.5 million to $104.5 million, down from an earlier estimate of $104.5 million to $105.5 million.
Hanesbrands' sales hold steady for Q3
Hanesbrands (NYSE: HBI), parent of Champion, said total net sales in the quarter held steady at $1.15 billion, increasing slightly. In the outerwear segment, Champion activewear sales increased by double-digits.
For the quarter ended Sept. 27, earnings per diluted share in the quarter were $0.17. Excluding actions and the previously announced impact of the Mervyns bankruptcy, non-GAAP earnings per diluted share increased by 17 percent to $0.56. The company said the increase was a result of reduced long-term debt, lower base interest rates, and lower income tax expense as a result of its global supply chain strategy.
"We continued our strategic execution in the third quarter and delivered comparable sales and solid earnings per share in a difficult environment," Hanesbrands CEO Richard A. Noll said in a statement. "We remain optimistic about our earnings potential for the fourth quarter due to favorability of expenses that may more than offset the challenges of higher commodity costs and an uncertain sales environment."
Brunswick declares common stock dividend
The board of directors of Brunswick Corp. (NYSE: BC) declared an annual dividend on its common stock of $0.05 cents per share payable Dec. 15 to shareholders of record on Nov. 24. Brunswick currently has approximately 87.7 million shares of common stock outstanding. The annual dividend declared in 2007 was $0.60 per share.
—Compiled by Wendy Geister
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