Columbia Sportswear Company · NASDAQ:COLM
Columbia Sportswear — Q3 2021 Earnings Presentation
21 slides from Columbia Sportswear's earnings presentation, Oct 28, 2021
Slide 1: Columbia Sportswear Company Q3 2021
% Columbia F sac Company. October 28, 2021 Exhibit 99.2
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation does not constitute an offer or invitation for the sale or purchase of securities and has been prepared solely for informational purposes. This presentation contains forward-looking statements within the meaning of the federal securities laws regarding Co
Slide 3: Abbreviations and definitions
DTC DTC.com DTC B&M y/y U.S. LAAP EMEA SG&A EPS bps direct-to-consumer DTC e-commerce DTC brick & mortar year-over-year United States Latin America and Asia Pacific Europe, Middle East and Africa selling, general & administrative earnings per share basis points “+” or “up” “-” or “down” LSD% MSD% HS
Slide 4: We connect active people with their passions
Slide 5: Strategic Priorities
STRATEGIC PRIORITIES We are committed to driving sustainable and profitable long-term growth and investing in our strategic priorities to: @ - DRIVE GLOBAL BRAND AWARENESS AND SALES. GROWTH THROUGH INCREASED, FOCUSED DEMAND ENHANCE CONSUMER EXPAND AND IMPROVE EXPERIENCE AND DIGITAL GLOBAL DTC OPERAT
Slide 6: Capital Allocation Priorities
CAPITAL ALLOCATION PRIORITIES Our goal is to maintain our strong balance sheet and disciplined approach to capital allocation. Dependent upon market conditions and our strategic priorities, our capital allocation approach includes: INVEST INORGANIC GROWTH OPPORTUNITIES TO DRIVE LONG-TERM PROFITABLE
Slide 7: Q3'21 Financial Results Compared to Q3'20
Q3'21 FINANCIAL RESULTS COMPARED TO Q3'20 a, ) +15% Net Sales Gross Margin Operating Margin Diluted EPS Q3’21 Highlights: * Favorable gross margin and SG&A performance resulted in better than planned earnings, despite supply chain disruptions which constrained net sales performance. + Strong consume
Slide 8: Q3'21 vs Q3'20 results table
• • • Q3'21 Q3'20 Change Net sales $804.7 $701.1 +15% Gross margin 50.7% 48.9% +180 bps SG&A percent of net sales 34.8% 37.3% -250 bps Operating income $133.5 $85.6 +56% Operating margin 16.6% 12.2% +440 bps Net income $100.6 $62.8 +60% Diluted EPS $1.52 $0.94 +62% (dollars in millions, except per s
Slide 9: Q3'21 Net Sales by Brand, Category and Channel
“Q3'21 NETSALES. BY BRAND - Q3'21 NET SALES AND GROWTH VS. Q3'20 CATEGORY PERFORMANCE , APPAREL, ACCESSORIES & EQUIPMENT: t +22% (+21% c.c.) $621M FOOTWEAR: y -4% (-5% c.c.) $184M + Footwear net sales performance was constrained by supply chain disruptions as well as footwear manufacturing capacity
Slide 10: Q3'21 Regional Net Sales Performance
~Q3'21 REGIONAL | NET SALES PE PERFORMANCE Q3'21 NET SALES AND GROWTH VS. Q3'20 DTC growth and higher Fall 2021 orders benefitted from * A the anniversary of prior year pandemic disruptions CANADA +26% (+18% c.c.) — $82M EMEA +10% (+9% c.c.) U.S. $109M +15% (+15% c.c.) $511M ™! LAAP +13% (+10% c.c.)
Slide 11: Q3'21 Gross-Margin Bridge
Q3'21 GROSS-MARGIN BRIDGE Q3'21 gross margin expanded 180bps y/y to 50.7% Gross Margin expansion primarily reflects: Tailwinds + Channel Profitability: favorable DTC product margins driven by lower promotional levels Channel Profitability: increased wholesale product margin driven by strong retail s
Slide 12: SG&A expense increase drivers
The y/y increase in SG&A expenses was primarily SG&A increased 7% y/y to $280.1M driven by: SG&A Expense Increases + Global Retail: increased expenses relative to prior |] fo year temporary store closures — + Incentive Comp: higher incentive compensation + Demand Creation: higher variable spending w
Slide 13: Balance Sheet Overview
BALANCE SHEET OVERVIEW Balance Sheet as of September 30, 2021 Cash, Cash Equivalents and Short-term Investments S601M Cash, cash equivalents and short-term investments totaled $600.6M, compared to $314.5M as of September 30, 2020. The Company had no borrowings as of September 30, 2021 or 2020. Inven
Slide 14: Cash Flow Overview
CASH FLOW OVERVIEW Cash Flow for the Nine Months Ended September 30, 2021 Net Cash Flow from Operations A Net cash flow used in operating activities was $15.6M, IVI compared to net cash flow used in operating activities of $198.0M for the same period in 2020, Capital Expenditures Capital expenditure
Slide 15: COVID-19 and supply chain update
The Company's top priority throughout the pandemic remains to protect the health and safety of our employees, their families, our customers and our communities. We are continually adapting business operations to adhere to evolving local and regional guidelines and safety protocols across all areas o
Slide 16: 2021 Financial Outlook
The Company's 2021 Financial Outlook and the underlying assumptions are forward-looking in nature, and the forward-looking statements reflect our expectations as of October 28, 2021 and are subject to significant risks and business uncertainties, including those factors described under “Forward-Look
Slide 17: 2021 net sales outlook assumptions
net sales growth pri refl + All brands are anticipated to grow in 2021 led by the Mountain Hardwear and Columbia brands. + Allfour geographic segments are anticipated to grow in 2021. Within our LAAP region, LAP distributor markets and Japan are anticipated to have slower recovery curves. + From a p
Slide 18: 2021 outlook: tax, cash flow and capex
h flow and. res income tax rate may be affected by unanticipated impacts from changes in international, federal or state tax policies, changes in the Company's geographic mix of pre-tax income, other discrete events, as well as differences from our estimate of the tax benefits associated with employ
Slide 19: Appendix
Slide 20: Third Quarter 2021 Constant-Currency Reconciliation
THIRD QUARTER 2021 CONSTANT-CURRENCY RECONCILIATION COLUMBIA SPORTSWEAR COMPANY Reconciliation of GAAP to Non-GAAP Financial Measures Net Sales Growth - Constant-currency Basis (Unaudited) “Three Months Ended September 30, “Adjstfor Constant Constant Reported Foreign curency Reported Reportad curren
Slide 21: First Nine Months 2021 Free Cash Flow Reconciliation
FIRST NINE MONTHS 2021 FREE CASH FLOW RECONCILIATION COLUMBIA SPORTSWEAR COMPANY Reconciliation of GAAP to Non-GAAP Financial Measures Net cash used in operating activities to free cash flow (Unaudited) Nine Months Ended September 30, {te mitions) 2021 2020 Nel cash used in operating actives $ (156)