Athletic apparel maker Under Armour (UAA 6.13%) reported first-quarter earnings that fell 50% year over year but handily beat the Capital IQ consensus estimates by $0.03 per share. Revenues surged 22% year over year, coming in well ahead of estimates.
Under Armour recorded revenues of $4712.6 million in the quarter that ended March 31, easily outpacing last year's $384.4 million effort and ahead of Wall Street's estimates of $468.4 million. On the bottom line, it generated $7.8 million, or $0.07 per share, down sharply from the year-ago figure of $0.14 per share but well ahead of the $0.03-per-share estimate.
The profit decline was driven largely by increases in its planned marketing expenditures, which saw SG&A expenses jump almost 35% from the year-ago figure and caused operating income to tumble 44% to $13.5 million.
Under Armour Chairman and CEO Kevin Plank said, "Our strong start to 2013 was underscored by the successful debut of our first of three Brand Holidays planned for this year, which included our largest ever global marketing campaign, I WILL. As part of this Brand Holiday, we opened the first UA Brand House retail store in our hometown of Baltimore, launched the first-of-its kind performance monitoring system for athletes, Armour39, and expanded our footwear running platform led by UA Spine Venom."
Apparel revenues jumped primarily because of the introduction of new Baselayer products and strong sales of fleece while footwear sales surged 27% to $81 million as it introduced new running styles, particularly UA Spine Venom.
The apparel maker plans to hold an investor day conference on June 5. It ended the quarter with $256 million in cash and equivalents on its balance sheet, a 139% increase from 2012, while long-term debt decreased to $60 million.