Under Armour(UA) - 2024 Q4 - Annual Report

Financial Performance - The Company reported a consolidated net revenue of $1,199.1 million as of March 31, 2024, with contract maturities ranging from one to twenty-four months [201]. - The Company's total net revenue for the year ended March 31, 2024, was $5.7 billion, a decrease from $5.9 billion for the year ended March 31, 2023, representing a decline of approximately 3.4% [216]. - Net income for the year ended March 31, 2024, was $232,042, a decrease of 38% compared to $374,459 for the year ended March 31, 2023 [231]. - The Company reported a basic net income per share of $0.53 for the year ended March 31, 2024, down from $0.83 in the previous year, a decrease of about 36% [224]. - The Company reported net revenues of $5,701,879 for the three months ended March 31, 2024, compared to $5,903,165 for the same period in 2023 [353]. - The Company reported a net income (loss) of $(0.3) million from its Japanese licensee for Fiscal 2024, an improvement from $(2.5) million in Fiscal 2023 [276]. Expenses and Costs - Gross profit for the year ended March 31, 2024, was $2.63 billion, compared to $2.64 billion for the previous year, indicating a slight decrease of about 0.5% [224]. - Selling, general and administrative expenses increased to $2.4 billion for the year ended March 31, 2024, compared to $2.38 billion in the previous year, marking an increase of about 5.1% [224]. - The Company reported depreciation and amortization expenses of $142,590, an increase of 5% from $135,456 in the previous year [231]. - Advertising expenses for Fiscal 2024 amounted to $568.5 million, a decrease from $620.3 million in Fiscal 2023 [272]. - The Company recorded a 401(k) Deferred Compensation Plan expense of $10.6 million for Fiscal 2024, down from $11.6 million in Fiscal 2023 [333]. Assets and Liabilities - The Company had total assets of $4.76 billion as of March 31, 2024, a slight decrease from $4.82 billion as of March 31, 2023 [221]. - Total liabilities amounted to $2.61 billion as of March 31, 2024, compared to $2.86 billion in the previous year, indicating a reduction of approximately 8.7% [221]. - The Company’s total goodwill as of March 31, 2024, is $478.3 million, a decrease from $481.99 million as of March 31, 2023, primarily due to currency translation adjustments [298]. - The total liability for unrecognized tax benefits as of March 31, 2024, was approximately $79.9 million, including $15.0 million for the accrual of interest and penalties [368]. Cash Flow and Financing - Cash flows from operating activities provided $353,970, a significant recovery from a cash outflow of $39,886 in the previous year [231]. - Total cash, cash equivalents, and restricted cash at the end of the period was $876,917, up from $726,745 a year earlier, reflecting a net increase of $150,172 [234]. - The Company incurred and deferred $5.4 million in financing costs related to the Senior Notes [312]. - The Company has approximately $80.9 million aggregate principal amount of 1.50% convertible senior notes due 2024, with a fixed interest rate of 1.50% per annum [309]. Risk Management - The company is exposed to inflationary pressures that may adversely affect operating results, particularly in product input costs and consumer discretionary spending [204]. - The company is subject to risks related to foreign currency exchange rate fluctuations, which could impact financial condition and results of operations [201]. - The allowance for doubtful accounts is deemed sufficient to cover customer credit risks as of March 31, 2024 [203]. - The Company has maintained its commitment to effective internal control over financial reporting, although challenges remain due to identified weaknesses [213]. Legal and Regulatory Matters - The Company is involved in ongoing litigation related to securities and derivative actions, which could have material implications for its financial position [320]. - The Company has accrued $100 million for legal proceeding contingencies as of March 31, 2024, with potential losses expected to exceed this amount [323]. - The Company expects a portion of potential legal losses to be covered by insurance, although the recorded accrual currently exceeds available insurance coverage [323]. Future Outlook - Future outlook suggests continued focus on market expansion and new product development to drive revenue growth [381]. - The restructuring plan approved by the Board of Directors aims to improve profitability and cash flow, with estimated pre-tax charges of approximately $70 million to $90 million during Fiscal 2025 [384]. - The company plans to enhance operational efficiency to improve profit margins in the upcoming quarters [381].