Under Armour Results

Under Armour, announced financial results for the second quarter ended June 30, 2015.  Net revenues increased 29% in the second quarter of 2015 to $784 million compared with net revenues of $610 million in the prior year’s period.  On a currency neutral basis, net revenues increased 31% compared with the prior year’s period.

Net income decreased 17% in the second quarter of 2015 to $15 million compared with $18 million in the prior year’s period and diluted earnings per share for the second quarter of 2015 were $0.07 compared with $0.08 per share in the prior year’s period, inclusive of the impacts of the Endomondo and MyFitnessPal acquisitions.

Second quarter apparel net revenues increased 23% to $515 million compared with $420 million in the same period of the prior year, driven primarily by enhanced product offerings in baselayer and training.  Second quarter footwear net revenues increased 40% to $154 million from $110 million in the prior year’s period, primarily reflecting continued product expansion across the running category and ongoing excitement around Stephen Curry signature product.

Second quarter accessories net revenues increased 39% to $83 million from $60 million in the prior year’s period, driven primarily by new introductions across the bags category.  Direct-to-Consumer net revenues, which represented 32% of total net revenues for the second quarter, grew 33% year-over-year.  International net revenues, which represented 11% of total net revenues for the second quarter, grew 93% year-over-year.

Kevin Plank, Chairman and CEO of Under Armour, Inc., stated, «More than ever before, this year has highlighted that the right investments are key to not only driving near-term results, but building the foundation for the unlimited potential of the Under Armour Brand.  In the second quarter of 2015, we witnessed historic performances and accolades from our incredible portfolio of athletes including the NBA’s MVP and World Champion Stephen Curry, PGA Tour pro Jordan Spieth who won this year’s Masters & U.S. Open and the American Ballet Theatre’s first-ever African American female principal dancer Misty Copeland. Leveraging these unprecedented successes for our Brand remain critical as we continue to align our strategy to attack key growth categories and drive deeper connections with the athlete.

«Some of these powerful connections are already evident across our distribution, where we are investing in expanded relationships with our key sporting goods and mall partners, as well as supporting our own direct-to-consumer capabilities including new Brand Houseopenings across both the U.S. and our International markets.  It also means continuing to build one of our key foundations for future growth with Connected Fitness.  With our Connected Fitness community now totaling more than 140 million unique registered users and adding on average more than 100,000 new athletes each day, we are pleased with our progress and believe we are still in the early stages of uncovering the potential of what the world’s largest digital health and fitness community can do to build consumer engagement and drive healthier lifestyles.» said  Plank. 

Gross margin for the second quarter of 2015 was 48.4% compared with 49.2% in the prior year’s period, primarily reflecting the impacts of foreign exchange rates and planned air freight expenses.  Selling, general and administrative expenses as a percentage of net revenues were 44.3% in the second quarter of 2015 compared with 43.5% in the prior year’s period, primarily reflecting investments to support Connected Fitness and the opening of global Brand House stores in the quarter.  Second quarter operating income decreased 8% to $32 million compared with $35 million in the prior year’s period.