Columbia Sportswear Company (NASDAQ:COLM) Q3 2023 Earnings Conference Call October 26, 2023 5:00 PM ET Company Participants Andrew Burns - Investor Relations Tim Boyle - Chairman, President and Chief Executive Officer Jim Swanson - Executive Vice President and Chief Financial Officer Conference Call Participants Bob Drbul - Guggenheim Mauricio Serna - UBS Laurent Vasilescu - BNP Paribas Alex Douglas - TD Cowen Jim Duffy - Stifel Abbie Zvejnieks - Piper Sandler Alex Perry - Bank of America Jonathan Komp - RW ...

DTC direct-to-consumer “+” or “up” increased “$##M” in millions of U.S. dollars DTC.com DTC e-commerce “-” or “down” decreased “$##B” in billions of U.S. dollars DTC B&M DTC brick & mortar LSD% low-single-digit percent c.c. constant-currency y/y year-over-year MSD% mid-single-digit percent M&A mergers & acquisitions U.S. United States HSD% high-single-digit percent FX foreign exchange LAAP Latin America and Asia Pacific LDD% low-double-digit percent ~ approximately ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_______to_______ ————————————————————— Commission file number 000-23939 ————————————————————— COLUMBIA SPORTSWEAR COMPANY (Exact name of registrant as specified in its cha ...

Columbia Sportswear Company (NASDAQ:COLM) Q2 2023 Results Conference Call August 1, 2023 5:00 PM ET Company Participants Andrew Burns - Investor Relations Tim Boyle - Chairman, President and CEO Jim Swanson - Executive Vice President and CFO Peter Bragdon - Executive Vice President, Chief Administrative Officer and General Counsel Conference Call Participants Bob Drbul - Guggenheim Laurent Vasilescu - BNP Paribas Mitch Kummetz - Seaport Research John Kernan - TD Cowen Jonathan Komp - Baird Jim Duffy - Stife ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from_______to_______ ————————————————————— Commission file number 000-23939 ————————————————————— COLUMBIA SPORTSWEAR COMPANY (Exact name of registrant as specified in its ch ...

Q1 2023 Performance Highlights - Global net sales increased by 8% (10% c.c.), driven by early shipments of Spring '23 wholesale orders and DTC growth[17] - Gross margin decreased by 100 bps to 48.7%, primarily due to increased promotional activity[18, 26] - Operating income decreased by 33% to $56.4 million, with operating margin declining by 410 bps to 6.9%[18] - Net income decreased by 31% to $46.2 million, and diluted EPS decreased by 28% to $0.74[18] - The company exited the quarter with $460.6 million in cash and short-term investments and no borrowings[17] Net Sales Breakdown - Apparel, Accessories & Equipment sales increased by 12% (14% c.c.) to $633 million, while Footwear sales decreased by 4% (-1% c.c.) to $188 million[20] - Wholesale sales increased by 11% (14% c.c.) to $453 million, and DTC sales increased by 4% (7% c.c.) to $368 million[20] - U S wholesale sales increased by MSD%, while DTC sales increased by LSD%[24] - Canada net sales increased 35% (+43% c.c.)[25] Balance Sheet and Capital Allocation - Inventories increased by 34% y/y to $959 million, driven by elevated carryover inventory and early receipt of current season inventory[28] - Net cash provided by operating activities was $78 million[31] - The company repurchased 179,421 shares for $15.8 million, at an average price of $87.80 per share[32] 2023 Financial Outlook - Net sales are projected to be between $3.57 billion and $3.67 billion, representing a 3% to 6% increase compared to 2022[34] - Operating income is projected to be between $413 million and $432 million, representing a 5% to 10% increase compared to 2022[34] - Diluted EPS is projected to be between $5.15 and $5.40, representing a 4% to 9% increase compared to 2022[34]

Financial Data and Key Metrics Changes - Net sales for Q1 2023 were $821 million, representing an 8% year-over-year increase and a 10% increase in constant currency [7][11] - Gross margin contracted by 100 basis points, primarily due to higher promotional activity compared to the previous year [11] - SG&A expenses increased by 16%, accounting for 42.3% of net sales, up from 39.3% in the prior year [12] Business Line Data and Key Metrics Changes - Columbia brand net sales increased by 12%, driven by apparel, while SOREL brand net sales decreased by 3% due to a challenging footwear environment [18][23] - Mountain Hard Wear net sales increased by 18%, while prAna net sales decreased by 1% [24] - The footwear category faced headwinds, particularly in hike and trail segments, which softened after several years of growth [8][23] Market Data and Key Metrics Changes - International markets showed resilience, with net sales growing 17% on a reported basis and 25% on a constant currency basis [7] - U.S. net sales increased by 3%, with wholesale benefiting from earlier shipments of Spring 2023 orders [13] - Latin America and Asia-Pacific region net sales increased by 22%, with China seeing mid-20% growth [14] Company Strategy and Development Direction - The company aims to reduce inventory levels by over $200 million compared to the previous year, focusing on profitability [9] - Strategic investments are being made in footwear to unlock long-term growth potential [18] - The company is enhancing its digital presence and community engagement to connect with consumers authentically [16][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating economic uncertainties due to a strong financial position, with over $460 million in cash and no bank borrowings [11] - The company reiterated its net sales growth outlook of 3% to 6% for the year, with expectations for gross margin expansion [26] - Management acknowledged challenges in the footwear category but remains optimistic about future growth driven by innovative product launches [32][52] Other Important Information - The company launched a new China-specific product collection named Transit, which has shown exceptional initial sell-through performance [14] - Columbia was announced as the first exclusive partner of Megamarsch, a series of hiking events in Europe, expected to drive momentum in the hiking category [17] Q&A Session Summary Question: Changes in the order book outlook for the remainder of the year - Management indicated no significant changes in the order book, maintaining confidence in fulfilling orders better than the previous year [30][31] Question: SOREL brand growth expectations - Management noted that SOREL was impacted by logistics issues and promotional activity but remains optimistic about future growth, particularly in the sandal category [35][36] Question: SG&A expense increases - Management explained that the increase in SG&A was due to higher-than-expected warehousing and fulfillment costs, which are anticipated to normalize as inventory levels decrease [46][48] Question: Inventory dynamics and recovery of freight costs - Management expects inventory growth to slow down in the second quarter and anticipates a significant reduction in inventory levels by year-end [59][60] Question: DTC sales growth trends - Management reported strong traffic in brick-and-mortar stores, with e-commerce showing improvement later in the quarter due to increased promotions [66][93]

Part I [Business](index=5&type=section&id=Item%201.%20Business) Columbia Sportswear, a global leader in outdoor and lifestyle products, operates four brands and sells through wholesale and direct-to-consumer channels globally - The company's four primary brands are **Columbia®**, **SOREL®**, **Mountain Hardwear®**, and **prAna®**, each targeting different segments of the outdoor, active, and lifestyle market[16](index=16&type=chunk)[17](index=17&type=chunk)[18](index=18&type=chunk) - The business is seasonal, with a significant portion of sales occurring in the **third and fourth quarters**[21](index=21&type=chunk) - The company sells products in approximately **90 countries** across four geographic segments: **U.S., Latin America and Asia Pacific (LAAP), Europe, Middle East and Africa (EMEA), and Canada**[35](index=35&type=chunk) Manufacturing Concentration by Country (2022) | Product Category | Country | Production Share | | :--- | :--- | :--- | | Apparel, Accessories & Equipment | Vietnam | ~40% | | | Bangladesh | ~20% | | | Indonesia | ~15% | | | India | ~10% | | Footwear | Vietnam | ~70% | | | China | ~20% | Employee Workforce Breakdown (as of Dec 31, 2022) | Employee Type | Number of Employees | | :--- | :--- | | Full-time and part-time retail | ~5,040 | | Distribution center | ~1,270 | | Corporate and/or office | ~3,140 | | **Total** | **~9,450** | [Information About Our Executive Officers](index=14&type=section&id=Information%20About%20Our%20Executive%20Officers) This section details biographical information for the company's nine executive officers, including Chairman, President, and CEO Timothy P. Boyle - Timothy P. Boyle, a third-generation member of the founding family, serves as **Chairman, President, and Chief Executive Officer**[68](index=68&type=chunk) - The executive team includes leaders with significant prior experience at **Nike, Inc.**, such as Lisa A. Kulok (Chief Supply Chain Officer), Skip Potter (Chief Digital Information Officer), Tim Sheerin (SVP, Global Wholesale), and Craig Zanon (SVP, Emerging Brands)[71](index=71&type=chunk)[73](index=73&type=chunk)[74](index=74&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company faces numerous material risks including volatile consumer demand, intense competition, supply chain disruptions, and global regulatory changes - Changes in consumer demand are a **primary risk**, influenced by volatile economic conditions, competition, weather, and shifting consumer preferences[80](index=80&type=chunk) - Inaccurate demand forecasting poses a **significant risk**, potentially leading to excess inventory and write-downs, or inventory shortages and lost sales; the company notes it currently has **inventory levels in excess of demand**[84](index=84&type=chunk)[85](index=85&type=chunk) - The company relies on **contract manufacturers**, primarily in the **Asia Pacific region**, creating risks related to production capacity, quality control, and labor practices[88](index=88&type=chunk)[91](index=91&type=chunk) - Global operations are subject to risks from **currency fluctuations, geopolitical instability, and changes in trade policies**, with heightened exposure in Vietnam (manufacturing) and China (raw materials)[125](index=125&type=chunk)[130](index=130&type=chunk) - As of December 31, 2022, three related shareholders controlled **just under 50%** of the company's outstanding common stock, allowing them to exercise significant influence over corporate matters[153](index=153&type=chunk) [Unresolved Staff Comments](index=35&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments - None[156](index=156&type=chunk) [Properties](index=36&type=section&id=Item%202.%20Properties) The company's principal properties include owned headquarters and distribution centers, alongside approximately 450 mostly leased retail stores - Key **owned properties** include the corporate headquarters in Portland, OR, and major distribution centers in the U.S., Canada, and France[159](index=159&type=chunk) - As of December 31, 2022, the company operated **approximately 450 retail stores**, with most locations being leased[159](index=159&type=chunk) [Legal Proceedings](index=36&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal matters, none of which are expected to materially affect its financial condition or operations - The company does not expect ongoing litigation to have a **material adverse effect** on its financials[160](index=160&type=chunk) [Mine Safety Disclosures](index=36&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company - Not applicable[161](index=161&type=chunk) Part II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=37&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ, with a quarterly dividend approved and $529.4 million remaining for share repurchases - The Board of Directors approved a regular quarterly cash dividend of **$0.30 per share**, payable on March 21, 2023[166](index=166&type=chunk) - As of December 31, 2022, **$529.4 million** remained available under the company's share repurchase authorization; no stock was repurchased during the quarter ended December 31, 2022[170](index=170&type=chunk)[171](index=171&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) In 2022, net sales grew 11% to $3.46 billion, but gross margin declined due to freight costs, and operating income fell, impacted by an impairment charge Consolidated Results of Operations (2022 vs 2021, in Millions) | Metric | 2022 | 2021 | % Change | | :--- | :--- | :--- | :--- | | Net Sales | $3,464.2 M | $3,126.4 M | 11% | | Gross Profit | $1,711.1 M | $1,612.5 M | 6% | | Gross Margin | 49.4% | 51.6% | -220 bps | | Operating Income | $393.1 M | $450.5 M | -13% | | Net Income | $311.4 M | $354.1 M | -12% | | Diluted EPS | $4.95 | $5.33 | -7% | - The company recognized a **$35.6 million** impairment charge in 2022 related to the prAna brand's trademark and goodwill[202](index=202&type=chunk) - Key business environment trends impacting results included **inflationary pressures**, a **strengthening U.S. dollar**, **increased freight costs**, later inventory receipts, and **elevated inventory levels** across the marketplace[177](index=177&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk) - Inventory increased to **$1,028.5 million** at year-end 2022 from **$645.4 million** in 2021, due to unrealized sales growth projections and earlier receipts of Spring 2023 products; the company expects inventory to normalize in the second half of 2023[228](index=228&type=chunk) - Planned capital expenditures for 2023 are approximately **$70 to $90 million**, focusing on DTC operations, distribution projects, and digital capabilities[229](index=229&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=59&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is foreign currency exchange rate fluctuations, managed through forward contracts, with limited interest rate risk due to no outstanding credit facility balances - The primary market risk is **foreign currency exchange rate fluctuations**, which the company manages mainly through **currency forward contracts** to hedge anticipated inventory purchases and non-functional currency sales[257](index=257&type=chunk) - A hypothetical **10% unfavorable change** in exchange rates would have resulted in a decline of approximately **$66.4 million** in the net fair value of derivative contracts as of December 31, 2022, which would be substantially offset by changes in the value of the underlying hedged transactions[258](index=258&type=chunk) [Financial Statements and Supplementary Data](index=60&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements, with an unqualified auditor's opinion, noting critical audit matters related to prAna trademark and goodwill impairment testing - The independent auditor, Deloitte & Touche LLP, issued an **unqualified opinion** on the consolidated financial statements and the effectiveness of internal control over financial reporting[266](index=266&type=chunk)[280](index=280&type=chunk) - Critical Audit Matters identified were related to the valuation of the **prAna trademark and goodwill**, specifically the subjective nature of management's projected revenue forecasts used in the impairment analysis[271](index=271&type=chunk)[274](index=274&type=chunk) Key Consolidated Balance Sheet Data (as of Dec 31, in thousands) | (in thousands) | 2022 | 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $430,241 | $763,404 | | Inventories | $1,028,545 | $645,379 | | Total Assets | $3,051,546 | $3,067,128 | | Total Liabilities | $1,115,757 | $1,077,876 | | Total Shareholders' Equity | $1,935,789 | $1,989,252 | Key Consolidated Statements of Cash Flows Data (Year Ended Dec 31, in thousands) | (in thousands) | 2022 | 2021 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $(25,241) | $354,406 | | Net cash provided by (used in) investing activities | $72,740 | $(163,751) | | Net cash used in financing activities | $(360,831) | $(210,889) | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=111&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[430](index=430&type=chunk) [Controls and Procedures](index=111&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2022 - Management concluded that disclosure controls and procedures were **effective** as of December 31, 2022[432](index=432&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2022[434](index=434&type=chunk) [Other Information](index=111&type=section&id=Item%209B.%20Other%20Information) The company reports no other information - None[438](index=438&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=113&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the company's 2023 Proxy Statement - This section incorporates information **by reference** from the company's 2023 Proxy Statement[441](index=441&type=chunk) [Executive Compensation](index=113&type=section&id=Item%2011.%20Executive%20Compensation) Information regarding executive and director compensation is incorporated by reference from the company's 2023 Proxy Statement - This section incorporates information **by reference** from the company's 2023 Proxy Statement[442](index=442&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=113&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information regarding security ownership and equity compensation plans is incorporated by reference from the company's 2023 Proxy Statement - This section incorporates information **by reference** from the company's 2023 Proxy Statement[443](index=443&type=chunk) [Certain Relationships and Related Transactions, and Director Independence](index=113&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information regarding related person transactions and director independence is incorporated by reference from the company's 2023 Proxy Statement - This section incorporates information **by reference** from the company's 2023 Proxy Statement[444](index=444&type=chunk) [Principal Accountant Fees and Services](index=113&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information regarding principal accountant fees and services is incorporated by reference from the company's 2023 Proxy Statement - This section incorporates information **by reference** from the company's 2023 Proxy Statement[445](index=445&type=chunk) Part IV [Exhibits, Financial Statement Schedules](index=114&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists financial statements, schedules, and exhibits filed as part of the Annual Report on Form 10-K, including Schedule II - This section contains the **index of all exhibits** filed with the 10-K, including credit agreements, incentive plans, and certifications[449](index=449&type=chunk)[451](index=451&type=chunk) Schedule II: Valuation and Qualifying Accounts - Allowance for Doubtful Accounts (in thousands) | (in thousands) | Balance at Beginning of Period | Charged to Costs and Expenses | Deductions | Other | Balance at End of Period | | :--- | :--- | :--- | :--- | :--- | :--- | | Year Ended Dec 31, 2022 | $8,893 | $(2,044) | $(980) | $(426) | $5,443 | | Year Ended Dec 31, 2021 | $21,810 | $(10,758) | $(210) | $(1,949) | $8,893 | [Form 10-K Summary](index=120&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company provides no summary in this section - None[463](index=463&type=chunk)

Columbia Sportswear Company (NASDAQ:COLM) Q4 2022 Earnings Conference Call February 2, 2023 5:00 PM ET Company Participants Andrew Burns - Director, IR Tim Boyle - Chairman, President and CEO Jim Swanson - EVP and CFO Conference Call Participants Bob Drbul - Guggenheim Laurent Vasilescu - BNP Paribas Mitch Kummetz - Seaport Research Tracy Kogan - Citigroup Mauricio Serna - UBS Alex Perry - Bank of America Alex Douglas - Cowen Operator Greetings. Welcome to Columbia Sportswear Fourth Quarter 2020 Financial R ...