Columbia Sportswear Valuation
Valuation of
Columbia Sportswear Company (COLM)
Nicholas Stoll
FI 305 Financial Reporting & Analysis
Golden Gate University
April 27, 2012
INTRODUCTION Columbia Sportswear (COLM) is the global leader in in the design, sourcing, marketing and distribution of active outdoor apparel, footwear, accessories and equipment. The company design, develop, market and distribute active outdoor apparel, footwear, accessories and equipment under four primary brands: Columbia®, Mountain Hardwear®, Sorel® and Montrail®. With annual revenues of $1.694 billion (2011), Columbia is headquartered in Portland, Oregon, with offices and support centers throughout the United States, Europe, and Asia. As of December 31, 2011, the company employed approximately 3,600 people worldwide.
General industry conditions and the current economy
Columbia is in the apparel and accessory industry. This is a fragmented sector made up of wholesale and retail businesses and are companies manufacturing clothing and accessories. It is a very seasonal and volatile industry because of the complex emotional aspect that fashion plays in our society. Each season designers spend many hours creating new designs for the coming seasons. The designs are developed through expected developing trends as well as new creative bends conjured up by designers in the hopes that consumers will take to the newly developed creations. This industry is also complex because there are several broad sub categories within apparel of which some cater exclusively to specific consumers while other categories might market to one type of consumer but the apparel might cross over to other consumers as well.
The weather also strongly affects sales within the industry. For example, the outdoor/winter sport apparel category has had a decrease of 2% in their sales year over year ($2.191M vs. $2.241M for 2010) for the Aug to Dec period (the period when they make the majority of their
Columbia Sportswear Company (COLM)
Nicholas Stoll
FI 305 Financial Reporting & Analysis
Golden Gate University
April 27, 2012
INTRODUCTION Columbia Sportswear (COLM) is the global leader in in the design, sourcing, marketing and distribution of active outdoor apparel, footwear, accessories and equipment. The company design, develop, market and distribute active outdoor apparel, footwear, accessories and equipment under four primary brands: Columbia®, Mountain Hardwear®, Sorel® and Montrail®. With annual revenues of $1.694 billion (2011), Columbia is headquartered in Portland, Oregon, with offices and support centers throughout the United States, Europe, and Asia. As of December 31, 2011, the company employed approximately 3,600 people worldwide.
General industry conditions and the current economy
Columbia is in the apparel and accessory industry. This is a fragmented sector made up of wholesale and retail businesses and are companies manufacturing clothing and accessories. It is a very seasonal and volatile industry because of the complex emotional aspect that fashion plays in our society. Each season designers spend many hours creating new designs for the coming seasons. The designs are developed through expected developing trends as well as new creative bends conjured up by designers in the hopes that consumers will take to the newly developed creations. This industry is also complex because there are several broad sub categories within apparel of which some cater exclusively to specific consumers while other categories might market to one type of consumer but the apparel might cross over to other consumers as well.
The weather also strongly affects sales within the industry. For example, the outdoor/winter sport apparel category has had a decrease of 2% in their sales year over year ($2.191M vs. $2.241M for 2010) for the Aug to Dec period (the period when they make the majority of their
References: Yahoo Financials, 4/20/2012 Tim Boyle, CEO,Columbia press report, Earnings release, Feb 2, 2012 Morningstar Report, Jeremy Cohen, Feb 3, 2012 US Dept Columbia Sportswear Company, 2011 Annual Report [ 4 ]. “SIA: Snow Sports Sales on Track to Break Last Year’s Record…”, The B.O.S.S. Report, December 12, 2011, p. 6, Week 1150, Publisher: SportOneSource, LLC, Charlotte, NC [ 5 ] [ 6 ]. Tim Boyle, CEO,Columbia press report, Earnings release, Feb 2, 2012 [ 7 ]