Under Armour: higher targets ignored on Wall Street

(CercleFinance.com) - Under Armour announced on Thursday that it had raised its annual forecasts after reporting better-than-expected quarterly results following the implementation of its recent restructuring plan.


The US sports goods manufacturer posted a symbolic net profit of one million dollars in Q3 to end-December, amongst other things, pénalisé by the recognition of a new restructuring charge.

Its net sales fell by 6% to $1.4bn, but its gross margin improved by 2.4% to 47.5%, due to reduced recourse to promotions and favourable trends in raw materials and transport costs.

As a result, the Baltimore-based group now expects to achieve a gross margin increase of 1.60 points over the full year, rather than just 1.25-1.50 points.

Full-year sales are expected to fall by around 10%, compared with a previous forecast of between 10% and 15%.

In terms of profits, Under Armour now expects an operating loss of between $179m and $189m at the end of the financial year ending in March, compared with a previous target range of between $176m and $196m.

Despite this increase, the stock market on Wall Street ignored it on Thursday, with the sports equipment maker's share price closing down over 7%, after having risen by up to 4.5% at the start of the session.


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