Ambitious investment strategy at Under Armour
Baltimore-based Under Armour says it plans to open 15 new stores, update its running shoe range, upgrade its computer systems, increase investment for online services and focus on designing new products this year.
Although these measures will see costs exceeding revenue growth, according to chief financial officer, Brad Dickerson, this is part of a new long-term strategy. "We believe these investments are the key to building the growth platform for accelerated profitable growth in future years," he says.
The company’s fourth-quarter net income totalled $15.2 million compared with $8.3 million in the prior-year period. Revenues rose 24% to $222.2 million, largely because of higher apparel sales, which increased by 26% during the quarter. Footwear sales fell 5.1% year-on-year. "We learned we need to invest capital, both human and financial, to fully leverage the Under Armour opportunity in footwear," says chairman and CEO, Kevin Plank.
"Footwear is a key part of our mid- and long-term growth story," adds president, David McCreight. "And 2010 will represent a year of continued investment and concentration for us."
