BALTIMORE, Nov. 3, 2022
/PRNewswire/ -- Under Armour, Inc. (NYSE: UA, UAA) today announced
unaudited financial results for its second quarter of fiscal 2023
ended September 30, 2022. The company
reports its financial performance following accounting principles
generally accepted in the United States
of America ("GAAP"). This press release refers to "currency
neutral" and "adjusted" amounts, which are non-GAAP financial
measures described below under the "Non-GAAP Financial Information"
paragraph.
"We're pleased to have delivered second-quarter results that
were in line with our expectations," said Under Armour Interim
President and CEO Colin Browne.
"While we anticipate the immediate macroeconomic backdrop to stay
uncertain – we are taking a balanced approach to mitigate near-term
pressures while continuing to focus on the long-term strength of
our brand."
Browne continued, "By leaning into these strengths – performance
product innovation, deep consumer connections, and empowering
athletes – our team is working tirelessly across multiple
growth opportunities. From refining our target consumer to young
athletes and creating the space necessary to broaden our product
aperture – we're taking action to pivot to the growth we know
the Under Armour brand is capable of over the long term."
Second Quarter 2023 Review
- Revenue was up 2 percent to $1.6
billion (up 5 percent currency neutral) compared to the
prior year.
-
- Wholesale revenue increased 4 percent to $948 million, and direct-to-consumer revenue
decreased 4 percent to $577 million
due to a 9 percent decline in owned and operated store revenue
partially offset by a 4 percent increase in eCommerce revenue,
which represented 36 percent of the total direct-to-consumer
business during the quarter.
- North American revenue was down 2 percent compared to the prior
year at $1 billion, and international
revenue increased 7 percent to $547
million (up 16 percent currency neutral). Within the
international business, revenue increased 9 percent in EMEA (up 20
percent currency neutral), rose 7 percent in Asia-Pacific (up 14 percent currency neutral),
and increased 3 percent in Latin
America (up 4 percent currency neutral).
- Apparel revenue decreased 2 percent to $1 billion. Footwear revenue increased 14 percent
to $376 million. Accessories revenue
fell 12 percent to $111 million.
- Gross margin declined 560 basis points to 45.4 percent
compared to the prior year, driven primarily by higher promotions,
elevated freight expenses related to COVID-19 supply chain impacts,
unfavorable channel mix, and the negative impact of changes in
foreign currency.
- Selling, general & administrative expenses decreased
1 percent to $594 million, including
a $10 million legal expense related
to ongoing litigation matters.
- Operating income was $119
million. Adjusted operating income was $129 million.
- Net Income was $87
million. Excluding a $10
million legal expense related to ongoing litigation matters
and a $5 million benefit from a tax
valuation allowance release related to prior-period restructuring,
adjusted net income was $92
million.
- Diluted earnings per share was $0.19. Adjusted diluted earnings per share
was $0.20.
- Inventory was up 29 percent to $1.1 billion.
- Cash and Cash Equivalents were $854 million at the end of the quarter, and no
borrowings were outstanding under the company's $1.1 billion revolving credit facility.
Share Buyback Update
Under Armour repurchased $25
million of its Class C common stock during the second
quarter, reflecting 3.2 million shares retired. As of Sept. 30, 26 million shares for $350 million had been repurchased under its
two-year, $500 million program, which
the Board of Directors approved in February
2022.
Updated Fiscal 2023 Outlook
As a reminder, Under Armour began its new fiscal year 2023 on
April 1, 2022. Accordingly, the
comparable baseline period is April 1,
2021, through March 31, 2022.
Key points related to Under Armour's fiscal year 2023 outlook
include:
- Revenue is expected to grow at a low single-digit
percentage rate compared to the previous expectation of 5 to 7
percent growth due primarily to a more challenging retail
environment and additional negative impacts from changes in foreign
currency. Currency-neutral revenue is expected to be up at a
mid-single-digit percentage rate compared to the previous
expectation of 7 to 9 percent growth.
- Gross margin remains unchanged from the previous outlook
of a 375 to 425 basis point decline.
- Selling, general & administrative expenses are
expected to be down slightly against the prior year as the company
manages costs amid uncertain market conditions.
- Operating income is expected to reach $270 to $290
million compared to the previous range of $300 to $325
million. Excluding an expense related to ongoing litigation
matters, adjusted operating income is expected to reach
$290 to $310
million compared to the previous range of $310 to $335
million.
- Diluted earnings per share is expected to be
$0.56 to $0.60 compared to the previous expectation of
$0.61 to $0.67. This includes a $0.28 benefit related to a tax valuation
allowance release expected to be realized during the fiscal year.
Of this $0.28 benefit, $0.16 is related to prior restructuring.
Additionally, there is a $0.04
negative impact from a legal expense related to ongoing litigation
matters. Excluding these net positive impacts of $0.12, adjusted diluted earnings per share is
expected to be $0.44 to $0.48 compared to the previous expectation of
$0.47 to $0.53.
- Capital expenditures remain unchanged from an
expectation of approximately $225
million.
Conference Call and Webcast
Under Armour will hold its second quarter fiscal 2023
conference call today at approximately 8:30
a.m. Eastern Time. The call will be webcast live at
https://about.underarmour.com/investor-relations/financials and
will be archived and available for replay about three hours after
the live event.
Non-GAAP Financial Information
This press release refers to "currency neutral" and "adjusted"
results, as well as "adjusted" forward-looking estimates of the
company's results for its 2023 fiscal year ending March 31, 2023. Management believes this
information is helpful to investors to compare the company's
results of operations period-over-period because it enhances
visibility into its actual underlying results, excluding these
impacts. Currency-neutral financial information is calculated to
exclude changes in foreign currency exchange rates. References to
adjusted financial measures exclude the effect of legal expenses
related to ongoing litigation matters, the company's 2020
restructuring plan, and related impairment charges, including
goodwill and related tax effects. Where applicable, adjusted net
income (loss) and adjusted diluted income (loss) per share exclude
the non-cash amortization of debt discount on the company's
convertible senior notes, any gain or loss on extinguishing the
company's convertible senior notes, and related tax effects, and
any gain or loss from divestitures (including associated earn-outs
and expenses) and related tax effects. Management believes these
adjustments are not core to the company's operations. The
reconciliation of non-GAAP amounts to the most directly comparable
financial measure calculated according to GAAP is presented in
supplemental financial information furnished with this release. All
per-share amounts are reported on a diluted basis. In addition, in
connection with its change in fiscal year-end from December 31 to March 31, Under Armour is
presenting select non-GAAP financial measures for the twelve months
beginning on April 1, 2021, and
ending March 31, 2022, to provide
comparable reference periods against the company's new fiscal 2023
year, which began April 1, 2022, and
ends on March 31, 2023. These
supplemental non-GAAP financial measures should not be considered
in isolation. They should be contemplated in addition to, and not
as an alternative to, the company's reported results prepared per
GAAP. Additionally, the company's non-GAAP financial information
may not be comparable to similarly titled measures reported by
other companies.
About Under Armour, Inc.
Under Armour, Inc., headquartered in Baltimore, Maryland, is a leading inventor,
marketer, and distributor of branded athletic performance apparel,
footwear, and accessories. Designed to empower human performance,
Under Armour's innovative products and experiences are engineered
to make athletes better. For further information, please visit
http://about.underarmour.com.
Forward-Looking Statements
Some of the statements contained in this press release
constitute forward-looking statements. Forward-looking statements
relate to expectations, beliefs, projections, plans and strategies,
anticipated events or trends, and similar expressions concerning
matters that are not historical facts, such as statements regarding
our share repurchase program, our future financial condition or
results of operations, our prospects and strategies for future
growth, the impact of the COVID-19 pandemic on our business and
results of operations and the operations of our suppliers and
logistics providers, expectations regarding inflation, promotional
activities, freight, product cost pressures, and foreign currency
rates, our plans to prioritize investments and reduce our operating
expenses, the development and introduction of new products, the
implementation of our marketing and branding strategies, and the
future benefits and opportunities from significant investments. In
many cases, you can identify forward-looking statements by terms
such as "may," "will," "should," "could," "expects," "plans,"
"anticipates," "believes," "estimates," "predicts," "outlook,"
"potential" or the negative of these terms or other comparable
terminology. The forward-looking statements in this press release
reflect our current views about future events. They are subject to
risks, uncertainties, assumptions, and changes in circumstances
that may cause events or our actual activities or results to differ
significantly from those expressed in any forward-looking
statement. Although we believe that the expectations reflected in
the forward-looking statements are reasonable, we cannot guarantee
future events, results, actions, activity levels, performance, or
achievements. Readers are cautioned not to place undue reliance on
these forward-looking statements. A number of important factors
could cause actual results to differ materially from those
indicated by these forward-looking statements, including, but not
limited to: the impact of the COVID-19 pandemic on our industry and
our business, financial condition and results of operations,
including recent impacts on the global supply chain; changes
in general economic or market conditions, including inflation, that
could affect overall consumer spending or our
industry; failure of our suppliers, manufacturers or logistics
providers to produce or deliver our products in a timely or
cost-effective manner; labor or other disruptions at ports or
our suppliers or manufacturers; increased competition causing us to
lose market share or reduce the prices of our products or to
increase our marketing efforts significantly; fluctuations in
the costs of raw materials and commodities we use in our products
and costs related to our supply chain (including labor); changes to
the financial health of our customers; our ability to
successfully execute our long-term strategies; our ability to
effectively drive operational efficiency in our business and
realize expected benefits from restructuring plans; our
ability to effectively develop and launch new, innovative and
updated products; our ability to accurately forecast consumer
shopping and engagement preferences and consumer demand for our
products and manage our inventory in response to changing
demands; loss of key customers, suppliers or manufacturers;
our ability to further expand our business globally and to drive
brand awareness and consumer acceptance of our products in other
countries; our ability to manage the increasingly complex
operations of our global business; the impact of global events
beyond our control, including military conflict; our ability to
successfully manage or realize expected results from significant
transactions and investments; our ability to effectively
market and maintain a positive brand image; our ability to
effectively meet the expectations of our stakeholders with respect
to environmental, social and governance practices; the
availability, integration and effective operation of information
systems and other technology, as well as any potential interruption
of such systems or technology; any disruptions, delays or
deficiencies in the design, implementation or application of our
global operating and financial reporting information technology
system; our ability to attract key talent and retain the
services of our senior management and other key employees; our
ability to access capital and financing required to manage our
business on terms acceptable to us; our ability to accurately
anticipate and respond to seasonal or quarterly fluctuations in our
operating results; risks related to foreign currency exchange
rate fluctuations; our ability to comply with existing trade
and other regulations, and the potential impact of new trade,
tariff and tax regulations on our profitability; risks related
to data security or privacy breaches; and our potential
exposure to litigation and other proceedings. The
forward-looking statements here reflect our views and assumptions
only as of the date of this press release. We undertake no
obligation to update any forward-looking statement to reflect
events or circumstances after the statement's date or to reflect
unanticipated events.
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2022, and 2021
(Unaudited; in
thousands, except per share amounts)
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
|
% of Net
Revenues
|
|
2021
|
|
% of Net
Revenues
|
|
2022
|
|
% of Net
Revenues
|
|
2021
|
|
% of Net
Revenues
|
Net revenues
|
$
1,573,885
|
|
100.0 %
|
|
$
1,545,532
|
|
100.0 %
|
|
$
2,922,942
|
|
100.0 %
|
|
$
2,897,066
|
|
100.0 %
|
Cost of goods
sold
|
860,051
|
|
54.6 %
|
|
757,428
|
|
49.0 %
|
|
1,578,911
|
|
54.0 %
|
|
1,440,141
|
|
49.7 %
|
Gross
profit
|
713,834
|
|
45.4 %
|
|
788,104
|
|
51.0 %
|
|
1,344,031
|
|
46.0 %
|
|
1,456,925
|
|
50.3 %
|
Selling, general and
administrative expenses
|
594,424
|
|
37.8 %
|
|
599,384
|
|
38.8 %
|
|
1,190,138
|
|
40.7 %
|
|
1,144,387
|
|
39.5 %
|
Restructuring and
impairment charges
|
—
|
|
— %
|
|
16,656
|
|
1.1 %
|
|
—
|
|
— %
|
|
19,269
|
|
0.7 %
|
Income (loss) from
operations
|
119,410
|
|
7.6 %
|
|
172,064
|
|
11.1 %
|
|
153,893
|
|
5.3 %
|
|
293,269
|
|
10.1 %
|
Interest income
(expense), net
|
(3,555)
|
|
(0.2) %
|
|
(9,261)
|
|
(0.6) %
|
|
(9,560)
|
|
(0.3) %
|
|
(22,568)
|
|
(0.8) %
|
Other income (expense),
net
|
(5,771)
|
|
(0.4) %
|
|
(29,476)
|
|
(1.9) %
|
|
(20,012)
|
|
(0.7) %
|
|
(67,970)
|
|
(2.3) %
|
Income (loss) before
income taxes
|
110,084
|
|
7.0 %
|
|
133,327
|
|
8.6 %
|
|
124,321
|
|
4.3 %
|
|
202,731
|
|
7.0 %
|
Income tax expense
(benefit)
|
22,251
|
|
1.4 %
|
|
18,962
|
|
1.2 %
|
|
27,908
|
|
1.0 %
|
|
28,989
|
|
1.0 %
|
Income (loss) from
equity method investments
|
(908)
|
|
(0.1) %
|
|
(921)
|
|
(0.1) %
|
|
(1,806)
|
|
(0.1) %
|
|
(1,091)
|
|
— %
|
Net income
(loss)
|
$
86,925
|
|
5.5 %
|
|
$ 113,444
|
|
7.3 %
|
|
$
94,607
|
|
3.2 %
|
|
$ 172,651
|
|
6.0 %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per share of Class A, B
and C common stock
|
$
0.19
|
|
|
|
$
0.24
|
|
|
|
$
0.21
|
|
|
|
$
0.37
|
|
|
Diluted net income
(loss) per share of Class A, B
and C common stock
|
$
0.19
|
|
|
|
$
0.24
|
|
|
|
$
0.20
|
|
|
|
$
0.37
|
|
|
Weighted average
common shares outstanding Class A, B and C common
stock
|
Basic
|
454,322
|
|
|
|
470,002
|
|
|
|
456,357
|
|
|
|
464,831
|
|
|
Diluted
|
464,141
|
|
|
|
473,116
|
|
|
|
466,143
|
|
|
|
467,730
|
|
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2022, and 2021
(Unaudited; in
thousands)
|
|
NET REVENUES BY
PRODUCT CATEGORY
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
|
2021
|
|
% Change
|
|
2022
|
|
2021
|
|
% Change
|
Apparel
|
$
1,038,268
|
|
$
1,058,231
|
|
(1.9) %
|
|
$
1,906,696
|
|
$
1,932,424
|
|
(1.3) %
|
Footwear
|
375,885
|
|
329,718
|
|
14.0 %
|
|
723,136
|
|
672,359
|
|
7.6 %
|
Accessories
|
111,117
|
|
126,345
|
|
(12.1) %
|
|
207,948
|
|
237,848
|
|
(12.6) %
|
Total net
sales
|
1,525,270
|
|
1,514,294
|
|
0.7 %
|
|
2,837,780
|
|
2,842,631
|
|
(0.2) %
|
Licensing
revenues
|
33,123
|
|
31,099
|
|
6.5 %
|
|
61,258
|
|
54,360
|
|
12.7 %
|
Corporate Other
(1)
|
15,492
|
|
139
|
|
NM
|
|
23,904
|
|
75
|
|
NM
|
Total net
revenues
|
$
1,573,885
|
|
$
1,545,532
|
|
1.8 %
|
|
$
2,922,942
|
|
$
2,897,066
|
|
0.9 %
|
NET REVENUES BY
DISTRIBUTION CHANNEL
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
|
2021
|
|
% Change
|
|
2022
|
|
2021
|
|
% Change
|
Wholesale
|
$
948,154
|
|
$
910,655
|
|
4.1 %
|
|
$
1,739,840
|
|
$
1,678,266
|
|
3.7 %
|
Direct-to-consumer
|
577,116
|
|
603,639
|
|
(4.4) %
|
|
1,097,940
|
|
1,164,365
|
|
(5.7) %
|
Net
Sales
|
1,525,270
|
|
1,514,294
|
|
0.7 %
|
|
2,837,780
|
|
2,842,631
|
|
(0.2) %
|
License
revenues
|
33,123
|
|
31,099
|
|
6.5 %
|
|
61,258
|
|
54,360
|
|
12.7 %
|
Corporate Other
(1)
|
15,492
|
|
139
|
|
NM
|
|
23,904
|
|
75
|
|
NM
|
Total net
revenues
|
$
1,573,885
|
|
$
1,545,532
|
|
1.8 %
|
|
$
2,922,942
|
|
$
2,897,066
|
|
0.9 %
|
NET REVENUES BY
SEGMENT
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
|
2021
|
|
% Change
|
|
2022
|
|
2021
|
|
% Change
|
North
America
|
$
1,011,823
|
|
$
1,035,862
|
|
(2.3) %
|
|
$
1,921,179
|
|
$
1,941,355
|
|
(1.0) %
|
EMEA
|
262,679
|
|
241,201
|
|
8.9 %
|
|
467,860
|
|
448,425
|
|
4.3 %
|
Asia-Pacific
|
225,729
|
|
211,950
|
|
6.5 %
|
|
402,394
|
|
404,319
|
|
(0.5) %
|
Latin
America
|
58,162
|
|
56,380
|
|
3.2 %
|
|
107,605
|
|
102,892
|
|
4.6 %
|
Corporate Other
(1)
|
15,492
|
|
139
|
|
NM
|
|
23,904
|
|
75
|
|
NM
|
Total net
revenues
|
$
1,573,885
|
|
$
1,545,532
|
|
1.8 %
|
|
$
2,922,942
|
|
$
2,897,066
|
|
0.9 %
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2022, and 2021
(Unaudited; in
thousands)
|
|
INCOME (LOSS) FROM
OPERATIONS
|
|
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
% of Net
Revenues (2)
|
|
2021
|
% of Net
Revenues (2)
|
|
2022
|
% of Net
Revenues (2)
|
|
2021
|
% of Net
Revenues (2)
|
North
America
|
$
209,206
|
20.7 %
|
|
$
292,367
|
28.2 %
|
|
$
399,130
|
20.8 %
|
|
$
518,136
|
26.7 %
|
EMEA
|
35,895
|
13.7 %
|
|
41,772
|
17.3 %
|
|
54,076
|
11.6 %
|
|
81,664
|
18.2 %
|
Asia-Pacific
|
46,134
|
20.4 %
|
|
40,529
|
19.1 %
|
|
66,079
|
16.4 %
|
|
64,575
|
16.0 %
|
Latin
America
|
7,177
|
12.3 %
|
|
10,831
|
19.2 %
|
|
13,411
|
12.5 %
|
|
16,832
|
16.4 %
|
Corporate Other
(1)
|
(179,002)
|
NM
|
|
(213,435)
|
NM
|
|
(378,803)
|
NM
|
|
(387,938)
|
NM
|
Income (loss)
from
operations
|
$
119,410
|
7.6 %
|
|
$
172,064
|
11.1 %
|
|
$
153,893
|
5.3 %
|
|
$
293,269
|
10.1 %
|
|
(1) Corporate Other
primarily includes net revenues from foreign currency hedge gains
and losses generated by entities within the Company's operating
segments but managed through the Company's central foreign exchange
risk management program, as well as subscription revenues from the
Company's MapMyRun and MapMyRide platforms (collectively "MMR") and
revenue from other digital business opportunities. Corporate Other
also includes expenses related to the Company's central supporting
functions.
|
(2)
The percentage of operating income (loss) is calculated based on
total segment net revenues. The operating income (loss) percentage
for Corporate Other is not presented as a meaningful metric
(NM).
|
Under Armour,
Inc.
As of
September 30, 2022, and March 31, 2022
(Unaudited; in
thousands)
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
in '000s
|
|
September 30,
2022
|
|
March 31,
2022
|
Assets
|
|
|
|
|
Current
assets
|
|
|
|
|
Cash and cash
equivalents
|
|
$
853,652
|
|
$
1,009,139
|
Accounts receivable,
net
|
|
789,087
|
|
702,197
|
Inventories
|
|
1,080,420
|
|
824,455
|
Prepaid expenses and
other current assets, net
|
|
356,244
|
|
297,034
|
Total current
assets
|
|
3,079,403
|
|
2,832,825
|
Property and equipment,
net
|
|
636,746
|
|
601,365
|
Operating lease
right-of-use assets
|
|
471,894
|
|
420,397
|
Goodwill
|
|
468,332
|
|
491,508
|
Intangible assets,
net
|
|
9,291
|
|
10,580
|
Deferred income
taxes
|
|
18,528
|
|
20,141
|
Other long-term
assets
|
|
85,877
|
|
76,016
|
Total
assets
|
|
$
4,770,071
|
|
$
4,452,832
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
Accounts
payable
|
|
747,330
|
|
560,331
|
Accrued
expenses
|
|
353,435
|
|
317,963
|
Customer refund
liabilities
|
|
155,021
|
|
159,628
|
Operating lease
liabilities
|
|
132,184
|
|
134,833
|
Other current
liabilities
|
|
85,294
|
|
125,840
|
Total current
liabilities
|
|
1,473,264
|
|
1,298,595
|
Long-term debt, net of
current maturities
|
|
673,382
|
|
672,286
|
Operating lease
liabilities, non-current
|
|
705,027
|
|
668,983
|
Other long-term
liabilities
|
|
102,065
|
|
84,014
|
Total
liabilities
|
|
2,953,738
|
|
2,723,878
|
Total stockholders'
equity
|
|
1,816,333
|
|
1,728,954
|
Total liabilities
and stockholders' equity
|
|
$
4,770,071
|
|
$
4,452,832
|
Under Armour,
Inc.
For the Six Months
Ended September 30, 2022, and 2021
(Unaudited; in
thousands)
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
Six Months Ended
September 30,
|
in '000s
|
2022
|
|
2021
|
Cash flows from
operating activities
|
|
|
|
Net income
(loss)
|
$
94,607
|
|
$
172,651
|
Adjustments to
reconcile net income (loss) to net cash used in operating
activities
|
|
|
|
Depreciation and
amortization
|
68,007
|
|
72,335
|
Unrealized foreign
currency exchange rate (gain) loss
|
16,338
|
|
(2,349)
|
Loss on extinguishment
of senior convertible notes
|
—
|
|
58,526
|
Loss on disposal of
property and equipment
|
1,074
|
|
2,049
|
Non-cash restructuring
and impairment charges
|
—
|
|
6,302
|
Amortization of bond
premium and debt issuance costs
|
1,096
|
|
14,629
|
Stock-based
compensation
|
19,708
|
|
22,581
|
Deferred income
taxes
|
(2,021)
|
|
(23,405)
|
Changes in reserves
and allowances
|
4,452
|
|
(9,953)
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
(90,331)
|
|
(29,586)
|
Inventories
|
(266,824)
|
|
14,956
|
Prepaid expenses and
other assets
|
(15,486)
|
|
(26,033)
|
Other non-current
assets
|
(36,932)
|
|
32,712
|
Accounts
payable
|
167,149
|
|
43,179
|
Accrued expenses and
other liabilities
|
19,034
|
|
(1,432)
|
Customer refund
liabilities
|
(5,475)
|
|
(18,123)
|
Income taxes payable
and receivable
|
23,105
|
|
31,417
|
Net cash provided by
(used in) operating activities
|
(2,499)
|
|
360,456
|
Cash flows from
investing activities
|
|
|
|
Purchases of property
and equipment
|
(93,864)
|
|
(49,195)
|
Sale of property and
equipment
|
—
|
|
852
|
Earn-out from the sale
of the MyFitnessPal platform
|
35,000
|
|
—
|
Net cash used in
investing activities
|
(58,864)
|
|
(48,343)
|
Cash flows from
financing activities
|
|
|
|
Payments on long-term
debt and revolving credit facility
|
—
|
|
(506,280)
|
Proceeds from capped
call
|
—
|
|
91,722
|
Common Shares
Repurchased
|
(50,000)
|
|
—
|
Employee taxes paid for
shares withheld for income taxes
|
(803)
|
|
(1,322)
|
Proceeds from exercise
of stock options and other stock issuances
|
2,015
|
|
1,881
|
Net cash provided by
(used in) financing activities
|
(48,788)
|
|
(413,999)
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
(43,962)
|
|
8,608
|
Net increase in
(decrease in) cash, cash equivalents and restricted cash
|
(154,113)
|
|
(93,278)
|
Cash, cash
equivalents and restricted cash
|
|
|
|
Beginning of
period
|
1,022,126
|
|
1,359,680
|
End of
period
|
$
868,013
|
|
$
1,266,402
|
Under Armour,
Inc.
For the Three and Six
Months Ended September 30, 2022
(Unaudited)
|
|
The table below
presents the reconciliation of net revenue growth (decline)
calculated according to GAAP to currency-neutral net revenue a
non-GAAP measure. See "Non-GAAP Financial Information" above for
further information regarding the Company's use of non-GAAP
financial measures.
|
|
CURRENCY-NEUTRAL NET
REVENUE GROWTH (DECLINE) RECONCILIATION
|
|
|
Three months ended
September 30, 2022
|
|
Six months ended
September 30, 2022
|
Total Net
Revenue
|
|
|
|
Net revenue growth -
GAAP
|
1.8 %
|
|
0.9 %
|
Foreign exchange
impact
|
3.1 %
|
|
2.5 %
|
Currency neutral net
revenue growth - Non-GAAP
|
4.9 %
|
|
3.4 %
|
|
|
|
|
North
America
|
|
|
|
Net revenue growth -
GAAP
|
(2.3) %
|
|
(1.0) %
|
Foreign exchange
impact
|
0.4 %
|
|
0.3 %
|
Currency neutral net
revenue growth - Non-GAAP
|
(1.9) %
|
|
(0.7) %
|
|
|
|
|
EMEA
|
|
|
|
Net revenue growth -
GAAP
|
8.9 %
|
|
4.3 %
|
Foreign exchange
impact
|
11.5 %
|
|
9.4 %
|
Currency neutral net
revenue growth - Non-GAAP
|
20.4 %
|
|
13.7 %
|
|
|
|
|
Asia-Pacific
|
|
|
|
Net revenue growth -
GAAP
|
6.5 %
|
|
(0.5) %
|
Foreign exchange
impact
|
7.2 %
|
|
5.6 %
|
Currency neutral net
revenue growth - Non-GAAP
|
13.7 %
|
|
5.1 %
|
|
|
|
|
Latin
America
|
|
|
|
Net revenue growth -
GAAP
|
3.2 %
|
|
4.6 %
|
Foreign exchange
impact
|
0.8 %
|
|
0.2 %
|
Currency neutral net
revenue growth - Non-GAAP
|
4.0 %
|
|
4.8 %
|
|
|
|
|
Total
International
|
|
|
|
Net revenue growth -
GAAP
|
7.3 %
|
|
2.3 %
|
Foreign exchange
impact
|
8.5 %
|
|
6.8 %
|
Currency neutral net
revenue growth - Non-GAAP
|
15.8 %
|
|
9.1 %
|
Under Armour,
Inc.
For the Three and Six
months ended September 30, 2022
(Unaudited; in
thousands, except per share amounts)
|
|
The tables below
present the reconciliation of the Company's condensed consolidated
statement of operations presented in accordance with GAAP to
certain adjusted non-GAAP financial measures discussed in this
press release. See "Non-GAAP Financial Information" above for
further information regarding the Company's use of non-GAAP
financial measures.
|
|
ADJUSTED OPERATING
INCOME (LOSS) RECONCILIATION
|
|
in '000s
|
Three months ended
September 30, 2022
|
|
Six months ended
September 30, 2022
|
GAAP Income from
operations
|
119,410
|
|
153,893
|
Add: Impact of legal
expenses relating to litigation matters
|
10,000
|
|
20,000
|
Adjusted income from
operations
|
$
129,410
|
|
$
173,893
|
ADJUSTED NET INCOME
(LOSS) RECONCILIATION
|
|
in '000s
|
Three months ended
September 30, 2022
|
|
Six months ended
September 30, 2022
|
GAAP net
income
|
86,925
|
|
94,607
|
Add: Impact of legal
expenses relating to litigation matters
|
10,000
|
|
20,000
|
Add: Impact of
commission expense in connection with the sale of the
MyFitnessPal platform
|
—
|
|
490
|
Add: Impact of
provision for income taxes
|
(4,811)
|
|
(8,124)
|
Adjusted net
income
|
$
92,114
|
|
$
106,973
|
ADJUSTED DILUTED
EARNINGS (LOSS) PER SHARE RECONCILIATION
|
|
|
Three months ended
September 30, 2022
|
|
Six months ended
September 30, 2022
|
GAAP diluted net income
per share
|
$
0.19
|
|
$
0.20
|
Add: Impact of legal
expenses relating to litigation matters
|
0.02
|
|
0.04
|
Add: Impact of
commission expense in connection with the sale of the
MyFitnessPal platform
|
—
|
|
—
|
Add: Impact of
provision for income taxes
|
(0.01)
|
|
(0.01)
|
Adjusted diluted net
income per share
|
$
0.20
|
|
$
0.23
|
Under Armour,
Inc.
Outlook for the Year
Ended March 31, 2023
(Unaudited; in
millions, except per share amounts)
|
|
The tables below
present the reconciliation of the Company's fiscal 2023 outlook
presented in accordance with GAAP to certain adjusted non-GAAP
financial measures discussed in this press release. See "Non-GAAP
Financial Information" above for further information regarding the
Company's use of non-GAAP financial measures.
|
|
ADJUSTED OPERATING
INCOME RECONCILIATION
|
|
(in
millions)
|
|
Year Ended March 31,
2023
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
GAAP income from
operations
|
|
$
270
|
|
$
290
|
Add: Impact of legal
expenses relating to litigation matters
|
|
20
|
|
20
|
Adjusted income from
operations
|
|
$
290
|
|
$
310
|
ADJUSTED DILUTED
(LOSS) EARNINGS PER SHARE RECONCILIATION
|
|
(in
millions)
|
|
Year Ended March 31,
2023
|
|
|
Low end of
estimate
|
|
High end of
estimate
|
GAAP diluted net income
per share (1)
|
|
$
0.56
|
|
$
0.60
|
Add: Impact of legal
expenses relating to litigation matters
|
|
0.04
|
|
0.04
|
Add: Impact of
provision for income taxes
|
|
(0.16)
|
|
(0.16)
|
Adjusted diluted net
income per share
|
|
$
0.44
|
|
$
0.48
|
|
(1) GAAP diluted net
income (loss) per share excludes any potential earn-out related to
the sale of the MyFitnessPal platform.
|
Under Armour,
Inc.
As of September 30,
2022, and 2021
|
|
COMPANY-OWNED &
OPERATED DOOR COUNT
|
|
|
|
September
30,
|
|
|
2022
|
|
2021
|
Factory
House
|
|
178
|
|
179
|
Brand House
|
|
18
|
|
18
|
North
America total doors
|
|
196
|
|
197
|
|
|
|
|
|
Factory
House
|
|
162
|
|
144
|
Brand House
|
|
79
|
|
95
|
International total doors
|
|
241
|
|
239
|
|
|
|
|
|
Factory
House
|
|
340
|
|
323
|
Brand House
|
|
97
|
|
113
|
Total
doors
|
|
437
|
|
436
|
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SOURCE Under Armour, Inc.