Shares of Under Armour (UAA) rallied in the premarket Tuesday after third-quarter results topped Wall Street estimates as overseas sales of the sneaker maker rose sharply, aided by the ongoing expansion initiatives. The market was also buoyed by the upward revision of full-year earnings outlook.
Net income, on an adjusted basis, rose to $112 million or $0.25 per share, exceeding analysts’ forecast. Reported profit was $75.3 million or $0.17 per share, up from $54.2 million or $0.12 per share a year earlier.
Revenues of the Baltimore-headquartered sneaker maker moved up 2.4% to $1.44 billion during the three-month period and came in above expectations, helped by a 15% growth in international sales that more than offset a 2% decline in the North American market.
Wholesale revenue advanced 4%, while direct-to-consumer revenue remained broadly unchanged year-over-year. While footwear and accessories remained sluggish, apparel revenue rose 4%.
Wholesale revenue advanced 4%, while direct-to-consumer revenue remained broadly unchanged from last year
The company incurred pre-tax costs of $154 million during the quarter in connecting with its ongoing restructuring program and expects about $200-$220 million in restructuring and related charges for the remainder of the year.
“As we work through this chapter, we are staying sharply focused on our brand by connecting even more deeply with our consumers while delivering industry-leading, innovative products and premium experiences,” said CEO Kevin Plank.
In the whole of 2018, revenues are expected to grow between 3% and 4%, which reflects a low single-digit decline in North America and a 25% growth in the overseas market. Apparel is seen growing at mid-single-digits in 2018, footwear at a low single-digit and accessories at a mid-single-digit rate. Inventory is forecast to be flat to slightly down at the end of the year. The company revised up its full-year adjusted earnings guidance to the range of $0.19 per share to $0.22 per share from the previous outlook of $0.16-$0.19 per share.
Under Armour’s shares gained about 10% in the pre-market trading Tuesday, after closing the last trading session higher.