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Columbia Sportswear Company’s (COLM - Snapshot Report) fourth quarter 2012 earnings went up 8% to $1.15 from the year ago quarter backed by disciplined cost management. The earnings missed the Zacks Consensus Estimate by 5 cents.

Net sales slipped 5% from the year-ago quarter to $501.1 million. The sales were within the guidance of a range of $499.0 million and $503.0 million.

The decline in sales was due to mild cold during holiday season, customer caution and reduced retail traffic that impacted direct-to-consumer sales, as well as weakness at wholesale customers in the U.S. Moreover, spring 2013 advance orders shifted into the first quarter of 2013.

Gross profit declined 8.1% to $206.9 million due to lower sales. Gross margin contracted 120 basis points to 41.3% during the quarter. Operating income climbed 1.1% to $51.1 million due to lower selling, general & administrative expenses.

Segmental Information

Net sales in U.S. declined 7% to $273.8 million mainly due to mild winter and ongoing economic challenges. In Europe/Middle East/Africa (EMEA) region net sales slipped 20% from the year ago quarter to $62.0 million due to negative effect from changes in foreign currency exchange rates.

Net sales in Canada increased 5% from the year ago quarter to $33.3 million, backed by positive foreign currency translation. In Latin America & Asia Pacific net sales went up 6% to $132.0 million.

Apparel, Accessories & Equipment net sales slipped 2% from the year ago quarter to $392.3 million, and Footwear net sales was $108.8 million, down 14 percent from comparable prior year-quarter.

Full Year 2012

Net sales decreased 1% to $1.67 billion from the year-ago quarter mainly due to negative foreign exchange translation. Earnings declined 3% from the year-ago quarter to $2.93 per share.

Other Financial Updates

The company ended the year with $335.4 million in cash as of December 31, 2012 compared with $243.9 million at December 31, 2011.

2013 Outlook

The company expects 2013 net sales to remain flat compared to the year-ago level. Full-year operating margin is expected to be between 7.5% to 8.0% of sales.

For the first quarter of 2013 also, the company expects net sales is expected to remain flat compared to year ago level. Gross margin is expected to decrease between 120 and 170 basis points.

Other Stocks to Consider

Columbia Sportswear carries a Zacks Rank #5 (Strong Sell). However, some other companies in the textile apparel sector that warrant a look include Hanesbrands Inc. (HBI - Analyst Report), PVH Corp. (PVH - Analyst Report) and Guess Inc. (GES - Analyst Report), all of which carry a Zacks Rank #2 (Buy).

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