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Volume 24 No. 158


Under Armour today announced net revenues increased 34% to $403M during Q4 of '11. Net income increased 42% to $33M. Diluted earnings per share were $0.62, compared with $0.44 per share during Q4 last year. Apparel net revenues increased 27% to $323M, compared with $254M in the same period of the prior year, driven by continued strength in Fleece and the expanded Charged Cotton platform. Footwear net revenues increased 43% to $31M from $22M in the prior year's period, primarily reflecting new introductions in running footwear. Gross margin was 51.6%, compared with 51.7% in the prior year, reflecting less favorable North American wholesale apparel product margins along with the ongoing impact of the hats and bags transition in '11. For the full year '11, net revenues increased 38% to $1.473B, compared with $1.064B in the prior year and compared with the company's prior outlook of $1.46-1.47B. Diluted earnings per share for the full year increased 38% to $1.85 per share, compared with $1.34 per share (Under Armour). MARKET WATCH’s Matt Andrejczak noted company inventories “grew 63% through the first nine months of 2011 to support the launch of new cold weather exercise gear, hats, and bags.” But a mild winter “has been a setback for companies selling winter apparel.” Higher prices for petroleum-based synthetic materials used in the company’s fabrics “is another factor cited for rising inventory costs.” Under Armour’s stated goal is “for inventories to grow more closely with revenue” (, 1/24). At presstime, shares of Under Armour were trading at $72.98, down 4.51% from yesterday's close of $77.49 (THE DAILY).

Despite seeing total revenues decrease by $15.6M last year, Int'l Speedway Corporation today reported net income of $69.4M for FY '11. Admissions revenue decreased 10% from '10 to $144.4M, but ISC did not host IndyCar Series events at its Kansas, Chicagoland, Watkins Glen or Homestead tracks, as it did in '10. The company's motorsports related revenue increased 1% to $425.6M. Total expenses fell from $523.2M in '10 to $496.5M in '11. Total revenue in '11 was $629.7M. Looking ahead to '12, the company expects total revenues for the year to be between $610-630M. The decrease in revenues is largely because NASCAR cut a less lucrative renewal with SirusXM Radio, which will reduce the amount of ancillary rights revenue ISC receives in '12. ISC did not specify how much less SiriusXM will pay. The company reported the NASCAR industry in '11 earned $17M in total ancillary rights fees, which includes the satellite radio, international TV and online revenues. Of that, ISC took $8M. ISC said it expects to earn an "immaterial amount" of ancillary revenue in '12. At presstime, shares of ISC were trading at $26.40, down .35% from yesterday's close of $26.75.

Callaway Golf yesterday reported "wider fourth quarter losses," but said that it “is hitting expense reductions goals and that sales and profits will improve" in '12, according to the AP. Callaway said that it “lost $65.6 million in the quarter, compared with a loss of $34.9 million in the same year-ago period.” The Carlsbad-based company also said that last summer it “had eliminated 7 percent of its workforce as part of its restructuring as the economy took its toll on the sport.”  Revenue for the three-month period that ended Dec. 31 “fell 17 percent from $185.5 million to $153.9 million as sales of woods tumbled nearly 40 percent, and sales for irons, golf balls and accessories slid by double digits.” Putter sales, however, “rose 13 percent.” For the year, Callaway “lost $182.3 million versus a loss of $29.3 million in 2010,” making the company's adjusted loss $0.63 per share. Revenue declined 8% to “$886.5 million from $967.7 million.” Callaway anticipates adjusted earnings of $0.40-0.45 per share for the first half of '12, with revenue between $610-630M. Gross margins "are expected to be about" 44% (AP, 1/25). At presstime, Callaway shares were trading at $6.50, up .08% from yesterday's close of $6.42 (THE DAILY).