Under Armour shares slip as it reports lower sales in North America
Under Armour is still struggling to find its footing, with sales slipping in North America and investments in a turnaround plan putting a dent in potential profits.
The sports apparel company reported a $30 million loss--or a negative 7 cents in earnings per share--in the quarter ending March 31.
And while overall sales revenue rose 5.9% during the three month period, most of that growth was international rather than in its most important market, North America, where sales revenue shrank 0.4%.
Those numbers appeared to unnerve investors. Shares were down 3.36% to $14.84 per share in morning trading.
"North America remains the engine room of Under Armour, but the engine is sputtering,'' says Neil Saunders, managing director of the retail consultancy GlobalData. "That’s a big concern.''
In February, Under Armour announced a turnaround strategy that it estimates will cost roughly $110 million to $130 million this year. Without those charges, the company would have seen a $1 million profit in the last quarter.
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"Our first quarter results demonstrate measured progress against our focus on operational excellence and becoming a better company," Kevin Plank, Under Armour's CEO said in a statement. " We remain confident in our ability to deliver on our full year targets."