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Columbia Sportswear Reopens Stores, Brings Back Employees

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With restrictions to check the coronavirus outbreak being lifted, a number of companies are slated to reopen their stores. In this regard, Columbia Sportswear Company (COLM - Free Report) announced its plans to reopen 30 Columbia branded stores across 10states, effective today. Incidentally, the company will bring back more than 250 retail employees who were furloughed in the past. Prior to this, the company already reopened one Columbia branded store located in Nebraska.

Columbia Sportswear had temporarily shut company stores across Europe and North America owing to the rapid spread ofthe novel coronavirus. Also, U.S. retail store operations staffs were partially furloughed through May 1. Similar moves to furlough workers were undertaken in the company’s distribution centers. Meanwhile, the company’s online business is operational amid the coronavirus crisis.

This Zacks Rank #5 (Strong Sell) company reported dismal first-quarter 2020 results, which were primarily affected by concerns related to the coronavirus outbreak. Both the top and the bottom line deteriorated year over year and fell short of the Zacks Consensus Estimate. Moreover, gross margin in the quarter declined 360 basis points year over year due to coronavirus-led impacts. To top it, management expects net sales and operating loss to be significantly marred by the pandemic in the second quarter. It is also battling supply-chain disruptions, primarily due to temporary raw material and finished goods supplier shutdowns in Asia.


 

Nevertheless, the company is taking several actions to curtail costs and fortify capital position in the wake of this crisis. To this end, it has suspended dividend payouts and share buybacks, reduced operating and discretionary expenses as well as reduced planned inventory purchases for fall 2020.

Coming back to store reopening, the company is taking adequate precautionary measures for the sake of its employees’ and customers’ safety. This includes proper face coverings for workers, maintaining social distancing norms along with enhanced sanitization among other moves.

Apart from Columbia Sportswear, Five Below, Inc. (FIVE - Free Report) recently announced that it has begun the process of reopening stores and looks to open most by early June. Also, Bed Bath & Beyond, Inc. revealed plans to reopen stores in late May in a phased manner, keeping in mind the local and state regulations. Further, Kohl's Corporation (KSS - Free Report) announced its plans to reopen 25% of its stores by this week following the relaxation of coronavirus-induced lockdown restrictions in some regions.

Shares of Columbia Sportswear have lost 32.6% in the past three months compared with the industry’s decline of 35.5%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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