Columbia Sportswear Company (COLM) Q4 2024 earnings summary

Executive summary

• Q4 2024 net sales rose 3% year-over-year to $1.1 billion, led by strong EMEA (+24%) and LAAP (+7%) growth, while US declined 1% and Canada was flat.

• Operating margin expanded to 12.5% (+180 bps), aided by non-recurrence of prAna impairment and gross margin gains, partially offset by higher SG&A.

• Full-year 2024 net sales declined 3% to $3.37 billion, with U.S. wholesale weakness offsetting 1% global DTC growth; diluted EPS fell 7% to $3.82.

• Inventory decreased 7% year-over-year; cash and equivalents ended at $815.5 million with no borrowings.

• Profit improvement program delivered $90 million in cost savings; $318 million in share repurchases and $70 million in dividends returned to shareholders.

Financial highlights

• Q4 gross margin expanded 50 bps to 51.1% due to lower inventory clearance and favorable input costs, partially offset by FX headwinds.

• Q4 operating income grew 21% to $137.3 million; net income up 10% to $102.6 million; diluted EPS up 16% to $1.80.

• SG&A expenses rose 6% in Q4, mainly from higher incentive compensation and DTC costs.

• Full-year gross margin up 60 bps to 50.2%; operating margin for the year was 8.0% (down 90 bps); free cash flow for 2024 was $431.2 million.

• Year-end cash and equivalents: $815.5 million; inventories down 7% to $690.5 million.

Outlook and guidance

• 2025 net sales expected at $3.40–$3.47 billion, up 1–3% year-over-year; gross margin projected to expand 80 bps to ~51%.

• SG&A as a percent of sales to rise to 43.4–44.1%; operating margin projected at 7.7–8.3%.

• Diluted EPS guidance: $3.80–$4.15, including a $0.30 FX headwind; operating cash flow at least $250 million; capex $60–$80 million.

• Q1 2025 net sales expected to decline 1–3% year-over-year; EPS $0.62–$0.70.

• Demand creation spend to rise to 6.5% of sales in 2025 (from 5.9% in 2024).