Columbia Sportswear 2003 Annual Report Download - page 22

between boys and girls products, as well as greater clarification between products for young children and pre-
teens. The updated youth outerwear line will offer new products at better value for the consumer, with input from
our retailers to enhance the line.
We opened a European distribution center in Cambrai, France in 2003 to support our international growth.
The distribution center operated effectively in each of our two major shipping seasons during its first year of
operation. As a result of the growth of our footwear product category, and to reduce domestic shipping costs for
our footwear products, we are constructing a new domestic distribution center in Kentucky that we expect to
commence operations in 2005.
Results of Operations
Net income increased $17.6 million, or 17.2%, to $120.1 million for 2003 from $102.5 million for 2002.
Fully diluted earnings per share increased $0.40 to $2.96 for 2003 from $2.56 for 2002. Net income increased
$13.7 million, or 15.4%, to $102.5 million for 2002 from $88.8 million for 2001. Fully diluted earnings per share
increased $0.33 to $2.56 for 2002 from $2.23 for 2001.
The following table sets forth, for the periods indicated, the percentage relationship to net sales of specified
items in our consolidated statements of operations:
2003 2002 2001
Net sales ............................................................. 100.0% 100.0% 100.0%
Cost of sales .......................................................... 53.7 53.6 54.2
Grossprofit .......................................................... 46.3 46.4 45.8
Selling, general and administrative ........................................ 26.5 26.5 26.9
Net licensing income ................................................... (0.2) (0.2) (0.1)
Income from operations ................................................. 20.0 20.1 19.0
Interest (income) expense, net ............................................ (0.0) (0.0) 0.3
Incomebeforeincometax ............................................... 20.0 20.1 18.7
Incometaxexpense .................................................... 7.4 7.5 7.3
Netincome ........................................................... 12.6% 12.6% 11.4%
Year Ended December 31, 2003 Compared to Year Ended December 31, 2002
Net Sales: Consolidated net sales increased 16.6% to $951.8 million in 2003 from $816.3 million in 2002.
Our net sales growth was predominantly driven by the expansion of our international business, particularly our
European business, followed by our other international and Canadian businesses.
Sales growth was attributable to an increase in unit sales volume across all geographic markets and product
categories. Moreover, net sales growth was achieved in each of our product categories, in both dollars and unit
volumes, led by sportswear and followed by footwear, outerwear, accessories and equipment.
In 2003, we continued to experience a shift in our sales product mix as sales of sportswear and footwear
grew faster than outerwear and accessories. In 2002, outerwear represented 51.8% of net sales compared to
46.6% during 2003 while sportswear and footwear increased from 30.0% and 13.5% of net sales during 2002 to
32.7% and 15.6% of net sales during 2003, respectively. As a percentage of net sales, net sales from accessories
decreased slightly from 4.7% of net sales in 2002 to 4.6% of net sales in 2003. With our acquisition of Mountain
Hardwear, we have a new product category, equipment, which represented 0.5% of our 2003 net sales.
Net sales from outerwear increased $21.2 million, or 5.0%, to $443.7 million in 2003 from $422.5 million in
2002. Sales of outerwear decelerated in the United States due to the relative maturity of the outerwear product
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