Apparel brand predicts upbeat outlook for 2021 after encouraging Q4
Multi-award winning apparel brand Columbia Sportswear is predicting an upbeat outlook for this year following a better than expected fourth quarter.
The US company was buoyed by continued and robust e-commerce sales – up 41% year-on-year – and a spike in wholesale orders in December. It now projects 18% to 20% net sales growth for 2021.
The bullish target is based on Spring and Autumn 2021 orders that indicate a return to growth for wholesale business. Other items considered in the outlook include continued e-commerce growth and a return to growth in bricks and mortar sales. Fourth quarter sales fell 4% to $915.7m, compared to 2019, against a Wall Street estimate of $866.4m. Earnings fell 16% due partly to impairment charges tied to retail and its Prana trademark, but again topped Wall Street targets.
“We’re encouraged by the building momentum across our brand portfolio reflected in the continued robust growth of our e-commerce channel and a meaningful recovery in wholesale orders for the Spring and Fall 2021 seasons,” said Chairman, President and CEO Tim Boyle in a conference call with analysts.
Boyle cautioned that the company, which manufactures Columbia Performance Fishing Gear, still faces some operational headwinds and unknowns, including uncertainty over the pandemic and the resumption of international tourism supporting stores in destination locations and tourist-dependent markets. Industry-wide constraints on ocean transportation are also resulting in later customer deliveries of Spring 2021 production.
The brand’s most advanced cooling technology to date, Omni-Freeze Zero Ice, will launch this Spring and Omni-Heat Infinity will launch this Fall. Boyle described the latter as the “largest innovation launch in our company’s history” and said early retailer feedback and orders have been “incredibly encouraging.”
Marketing spend will be increased to 6% of sales in 2021 which, said Boyle, represents the highest level as a percentage of sales in Columbia’s history as a public company. Digital marketing and social media investments will continue to be priorities.
In 2020, 13 under-performing stores were closed in the US and one in Europe. In 2021, approximately eight stores are expected to open in the US.