American based Manufacturer, Under Armour, is likely to achieve a low double-digit growth rate by 2023, inclusive of a mid to high single-digit five-year compounded annual growth rate (CAGR), driven primarily by the company’s international and Direct-to-Consumer businesses. Under Armour’s new 5-year plan is constituted around two strategic priorities: protect and perform.
The first priority is a continued focus on elevating and protecting the Under Armour brand by taking actions to ensure the ability to consistently deliver what consumers, customers and shareholders expect from the company. Simultaneously, the second priority is performing with balance and working to create greater financial and operational agility across the company’s portfolio of businesses to ensure future growth is repeatable and consistent.
For fiscal 2018, gross margin is now expected to be flat versus the previous expectation of ‘flat to down slightly’ versus 45.1 per cent in 2017. Adjusted gross margin is likely to improve 20 to 30 basis points compared to 45.2 per cent in 2017 as benefits from product costs and lower planned promotional activity is offset primarily by inventory management actions.
Operating loss is now expected to be approximately 40 to 55 million US Dollar versus the previously expected 50 to 55 million US Dollar loss. On an adjusted basis, operating income is now expected to reach the 160 to 165 million US Dollar range versus the previous 150 to 165 million US Dollar range.
“Under Armour is designed for resilience and over the past two years, our global team has worked tirelessly to transform our business – operationally, strategically and culturally,” Under Armour chairman and CEO, Kevin Plank said. “With a distinct strategy engineered around a clear, uniquely defined consumer supported by a disciplined go-to-market process and data-driven demand mapping, we have never been more inspired, aligned and capable of achieving our goals.”
“As we execute against our long-term strategy, we remain unwavering in our commitment to protecting and growing the Under Armour brand,” Plank continued. “Led by a strong management team, an accelerated innovation agenda and comprehensive discipline around our commitment to increasing total shareholder return, we look forward to delivering the next chapter in our growth story.”
“Focusing on sustainable, profitable growth while increasing returns on capital and generating substantial cash will empower our ability to deliver industry-leading innovation, compelling premium consumer experiences and drive toward our targets, while steadily increasing returns to our shareholders,” chief financial officer David Bergman said.
– Apparel and Textile News, Apparel Talk, Indian Apparel
