BALTIMORE, May 2, 2019 /PRNewswire/ -- On February 12, 2019 Under Armour, Inc. (NYSE: UA,
UAA) announced the realignment of its segments to exclude certain
corporate costs from its operating segment profitability measures
and report these expenses as Corporate Other beginning in fiscal
2019.
Effective January 1, 2019, the
company changed the way management internally analyzes the
business to exclude certain corporate costs from its segment
profitability measures and will report these costs as "Corporate
Other". These costs consist largely of general and administrative
expenses not allocated to an operating segment, including expenses
associated with centrally managed departments such as information
technology, supply chain, innovation and other corporate support
functions; costs related to the company's global assets and
marketing; costs related to the company's headquarters;
restructuring and restructuring related charges; and certain
foreign exchange hedging gains and losses.
We believe this new segment presentation provides improved
visibility into the underlying performance and results of our five
operating segments: North America,
EMEA (Europe, Middle East, Africa), Asia-Pacific, Latin
America, and Connected Fitness. This change in segments most
significantly impacts the North
America operating segment, which previously recognized the
majority of the company's corporate overhead costs.
In conjunction with this change and today's announcement of the
company's financial results for the first quarter ended
March 31, 2019, certain prior year
amounts have been recast to conform to the 2019 presentation. These
changes have no impact on previously reported consolidated balance
sheets, statements of operations, comprehensive income (loss),
stockholder's equity, or cash flows. The recast of certain
unaudited historical financial information to reflect this segment
reporting change accompanies this press release.
As a result of the change in segments, the company has updated
its five-year segment operating profitability targets presented at
its December 12, 2018 investor
meeting in the table provided below. This segmentation recast only
impacts the five-year profitability target for the North America operating segment.
Operating
Income (Loss) Percentage by Segment
|
|
|
Year
Ended
December 31,
2018
(1)
|
December 12,
2018
Investor Day
2023
Target
|
Updated
2023
Target
|
North
America
|
19.2%
|
+Mid-Single-digit
|
+Low-to-Mid
20's
|
Asia-Pacific
|
18.6%
|
+Mid-20's
|
+Mid-20's
|
EMEA
|
5.1%
|
+Mid-Teen
|
+Mid-Teen
|
Latin
America
|
(8.8)%
|
+High
Single-digit
|
+High
Single-digit
|
Connected
Fitness
|
4.9%
|
+Mid-Teen
|
+Mid-Teen
|
Corporate Other
(2)
|
NM
|
NM
|
NM
|
Total
|
(0.5)%
|
~10%
|
~10%
|
|
(1) Reflects the
unaudited recast of historical information provided
below.
|
(2) Operating income
(loss) percentage for Corporate Other is not presented as it is not
a meaningful metric (NM).
|
About Under Armour, Inc.
Under Armour, Inc., headquartered in Baltimore, Maryland, is a leading inventor,
marketer and distributor of branded performance athletic apparel,
footwear and accessories. Designed to make all athletes better, the
brand's innovative products are sold worldwide to consumers with
active lifestyles. The company's Connected Fitness™
platform powers the world's largest digitally
connected health and fitness community. For further
information, please visit https://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, future plans and
strategies, anticipated events or trends and similar expressions
concerning matters that are not historical facts, such as
statements regarding our future financial condition or results of
operations, our prospects and strategies for future growth, 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," "expects," "plans," "assumes," "anticipates," "believes,"
"estimates," "predicts," "outlook," "potential" or the negative of
these terms or other comparable terminology. The forward-looking
statements contained in this press release reflect our current
views about future events and 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, levels of activity, 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 the
forward-looking statements, including, but not limited to: changes
in general economic or market conditions that could affect overall
consumer spending or our industry; changes to the financial health
of our customers; our ability to successfully execute our long-term
strategies; our ability to realize expected benefits from our
restructuring plans; our ability to effectively drive operational
efficiency in our business; our ability to manage the increasingly
complex operations of our global business; our ability to comply
with existing trade and other regulations, and the potential impact
of new trade, tariff and tax regulations on our profitability; our
ability to effectively develop and launch new, innovative and
updated products; our ability to accurately forecast consumer
demand for our products and manage our inventory in response to
changing demands; any disruptions, delays or deficiencies in the
design, implementation or application of our new global operating
and financial reporting information technology system; increased
competition causing us to lose market share or reduce the prices of
our products or to increase significantly our marketing efforts;
fluctuations in the costs of our products; loss of key suppliers or
manufacturers or failure of our suppliers or manufacturers to
produce or deliver our products in a timely or cost-effective
manner, including due to port disruptions; 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 accurately anticipate and respond to seasonal or quarterly
fluctuations in our operating results; our ability to successfully
manage or realize expected results from acquisitions and other
significant investments or capital expenditures; risks related to
foreign currency exchange rate fluctuations; our ability to
effectively market and maintain a positive brand image; the
availability, integration and effective operation of information
systems and other technology, as well as any potential interruption
of such systems or technology; risks related to data security or
privacy breaches; our ability to raise additional capital required
to grow our business on terms acceptable to us; our potential
exposure to litigation and other proceedings; and our ability to
attract key talent and retain the services of our senior management
and key employees. The forward-looking statements contained in this
press release 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 date on which the statement is made or to reflect the
occurrence of unanticipated events.
Under Armour,
Inc.
|
For the Three Months
Ended March 31, June 30, September 30 and December 31, 2018
and
|
For the Year Ended
December 31, 2018
|
(Unaudited; in
thousands)
|
|
REVENUE BY
SEGMENT
|
|
Three Months
Ended
|
Year Ended
|
|
|
|
(in
thousands)
|
March 31,
2018
|
June 30,
2018
|
September 30,
2018
|
December 31,
2018
|
December 31,
2018
|
North
America
|
$
|
867,545
|
|
$
|
843,383
|
|
$
|
1,059,535
|
|
$
|
964,830
|
|
$
|
3,735,293
|
|
Asia-Pacific
|
115,553
|
|
125,706
|
|
149,388
|
|
166,784
|
|
557,431
|
|
EMEA
|
129,588
|
|
136,942
|
|
147,640
|
|
176,887
|
|
591,057
|
|
Latin
America
|
46,514
|
|
40,757
|
|
54,299
|
|
49,225
|
|
190,795
|
|
Connected
Fitness
|
28,826
|
|
29,112
|
|
32,160
|
|
30,259
|
|
120,357
|
|
Corporate
Other
|
(2,656)
|
|
(1,041)
|
|
(46)
|
|
1,995
|
|
(1,748)
|
|
Total
|
$
|
1,185,370
|
|
$
|
1,174,859
|
|
$
|
1,442,976
|
|
$
|
1,389,980
|
|
$
|
5,193,185
|
|
REVENUE BY
DIVISION
|
|
Three Months
Ended
|
Year Ended
|
|
|
|
(in
thousands)
|
March 31,
2018
|
June 30,
2018
|
September 30,
2018
|
December 31,
2018
|
December 31,
2018
|
Apparel
|
$
|
768,931
|
|
$
|
748,335
|
|
$
|
978,457
|
|
$
|
968,397
|
|
$
|
3,464,120
|
|
Footwear
|
271,770
|
|
271,375
|
|
284,856
|
|
235,174
|
|
1,063,175
|
|
Accessories
|
92,158
|
|
105,906
|
|
116,186
|
|
108,246
|
|
422,496
|
|
Total net
sales
|
1,132,859
|
|
1,125,616
|
|
1,379,499
|
|
1,311,817
|
|
4,949,791
|
|
Licensing
|
26,341
|
|
21,172
|
|
31,363
|
|
45,909
|
|
124,785
|
|
Connected
Fitness
|
28,826
|
|
29,112
|
|
32,160
|
|
30,259
|
|
120,357
|
|
Corporate
Other
|
(2,656)
|
|
(1,041)
|
|
(46)
|
|
1,995
|
|
(1,748)
|
|
Total
|
$
|
1,185,370
|
|
$
|
1,174,859
|
|
$
|
1,442,976
|
|
$
|
1,389,980
|
|
$
|
5,193,185
|
|
REVENUE BY
CHANNEL
|
|
Three Months
Ended
|
Year Ended
|
|
|
|
(in
thousands)
|
March 31,
2018
|
June 30,
2018
|
September 30,
2018
|
December 31,
2018
|
December 31,
2018
|
Wholesale
|
$
|
781,248
|
|
$
|
711,449
|
|
$
|
914,225
|
|
$
|
735,061
|
|
$
|
3,141,983
|
|
Direct to
consumer
|
351,611
|
|
414,167
|
|
465,274
|
|
576,756
|
|
1,807,808
|
|
Total net
sales
|
1,132,859
|
|
1,125,616
|
|
1,379,499
|
|
1,311,817
|
|
4,949,791
|
|
Licensing
|
26,341
|
|
21,172
|
|
31,363
|
|
45,909
|
|
124,785
|
|
Connected
Fitness
|
28,826
|
|
29,112
|
|
32,160
|
|
30,259
|
|
120,357
|
|
Corporate
Other
|
(2,656)
|
|
(1,041)
|
|
(46)
|
|
1,995
|
|
(1,748)
|
|
Total
|
$
|
1,185,370
|
|
$
|
1,174,859
|
|
$
|
1,442,976
|
|
$
|
1,389,980
|
|
$
|
5,193,185
|
|
OPERATING INCOME
(LOSS) BY SEGMENT
|
|
Three Months
Ended
|
Year Ended
|
|
|
|
(in
thousands)
|
March 31,
2018
|
% of Net
Revenue
|
June 30,
2018
|
% of Net
Revenue
|
September
30, 2018
|
% of Net
Revenue
|
December
31, 2018
|
% of Net
Revenue
|
December
31, 2018
|
% of Net
Revenue
|
North
America
|
$
|
148,185
|
|
17.1
|
%
|
$
|
132,529
|
|
15.7
|
%
|
$
|
253,706
|
|
23.9
|
%
|
$
|
183,775
|
|
19.0
|
%
|
$
|
718,195
|
|
19.2
|
%
|
Asia-Pacific
|
24,122
|
|
20.9
|
%
|
21,391
|
|
17.0
|
%
|
36,579
|
|
24.5
|
%
|
21,435
|
|
12.9
|
%
|
103,527
|
|
18.6
|
%
|
EMEA
|
7,154
|
|
5.5
|
%
|
(5,945)
|
|
(4.3)
|
%
|
16,726
|
|
11.3
|
%
|
12,453
|
|
7.0
|
%
|
30,388
|
|
5.1
|
%
|
Latin
America
|
(1,878)
|
|
(4.0)
|
%
|
(4,689)
|
|
(11.5)
|
%
|
(3,772)
|
|
(6.9)
|
%
|
(6,540)
|
|
(13.3)
|
%
|
(16,879)
|
|
(8.8)
|
%
|
Connected
Fitness
|
3,411
|
|
11.8
|
%
|
1,711
|
|
5.9
|
%
|
2,132
|
|
6.6
|
%
|
(1,306)
|
|
(4.3)
|
%
|
5,948
|
|
4.9
|
%
|
Corporate
Other
|
(209,655)
|
|
NM
|
|
(249,872)
|
|
NM
|
|
(186,405)
|
|
NM
|
|
(220,264)
|
|
NM
|
|
(866,196)
|
|
NM
|
|
Total
|
$
|
(28,661)
|
|
(2.4)
|
%
|
$
|
(104,875)
|
|
(8.9)
|
%
|
$
|
118,966
|
|
8.2
|
%
|
$
|
(10,447)
|
|
(0.8)
|
%
|
$
|
(25,017)
|
|
(0.5)
|
%
|
|
NOTE: Operating
income (loss) percentage for Corporate Other is not presented as it
is not a meaningful metric (NM). Additionally, Corporate Other
includes approximately $204 million in charges related to the
Company's 2018 Restructuring Plan.
|
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SOURCE Under Armour, Inc.