Q4 2021 Columbia Sportswear Co Earnings Call

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Right.

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Yes.

Speaker 1: Greetings. Welcome to the Columbia Sportswear 4th quarter 2021 Financial Results Conference call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation.

Greetings.

And to the Columbia sportswear fourth quarter 2021 financial results conference call at.

At this time all participants are in a listen only mode.

A question and answer session will follow the formal presentation.

Speaker 1: If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Andrew Burns, Vice President of Investor Relations. Thank you. You may begin.

Anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. Please.

Please note this conference is being recorded.

I will now turn the conference over to your host Andrew Burns Vice President of Investor Relations. Thank you you may begin.

Speaker 2: Good afternoon, and thank you for joining us to discuss Columbia Sportswear Company's fourth quarter results. In addition to the earnings release, we furnished an 8K containing a detailed CFO commentary and financial review presentation explaining our results.

Good afternoon, and thank you for joining us to discuss Columbia sportswear company's fourth quarter results. In addition to the earnings release, we furnished an 8-K containing a detailed CFO commentary on financial review presentation, explaining our results.

Speaker 2: This document is also available on our investor relations website, investor.columbia.com. With me on the call today are Chairman, President and Chief Executive Officer, Jim Boyle, Executive Vice President and Chief Financial Officer, Jim Swanson, and Executive Vice President and Chief Administrative Officer, Peter Braga.

Document is also available on our Investor Relations website, Investor Doc Columbia Dot Com.

With me on the call today are chairman, President and Chief Executive Officer, Tim Boyle, Executive Vice President and Chief Financial Officer, Jim Swanson, and Executive Vice President and Chief administrative Officer, Peter Bragdon.

Speaker 2: Discuments call will contain forward looking statements regarding Columbia's expectations, anticipations, or beliefs about the future. These statements are expressed in good state, and I believe they have a reasonable basis. However, each forward looking statement is subject to many risks and uncertainties, and actual results may differ materially from what is projected. Many of these risks and uncertainties are described in Columbia's SEC5.

This conference call will contain forward looking statements regarding columbia's expectations anticipations or beliefs about the future. These statements are expressed in good faith and I believed to have a reasonable basis. However, each forward looking statement is subject to many risks and uncertainties and actual results may differ materially from what is projected many of these risks and uncertainties are dis.

Scribed in Columbia's SEC filings, we caution that forward looking statements are inherently less reliable than historical information, we do not undertake any duty to update any of the forward looking statements. After the date of this conference call to conform the forward looking statements to actual results or changes in our expectations.

Speaker 2: We caution that forward-looking statements are inherently less reliable than historical information. We do not undertake any duty to update any of the forward-looking statements after the date of this conference call to conform the forward-looking statements to actual results or changes in our actions.

Speaker 2: I'd also like to call out that during the call we may reference certain non-GAAP financial measures including constant currency net sales. For further information about non-GAAP financial measures and results including a reconciliation of GAAP to non-GAAP measures and an explanation of a man's rationale for referencing these non-GAAP measures, please refer to the supplemental financial information section and financial tables included in our fourth quarter 2021 earnings release and the appendix of our CFO commentary and financial review.

I'd also like to call out that during the call. We may reference certain non-GAAP financial measures, including constant currency net sales for further information about non-GAAP financial measures and results, including a reconciliation of GAAP to non-GAAP measures and an explanation of management's rationale for referencing these non-GAAP measures. Please refer to the supplemental financial information section and the <unk>.

Financial tables included in our fourth quarter 2021 earnings release, and the appendix of our CFO commentary financial review.

Speaker 2: Following our prepared remarks, we will host the Q&A period during which we will limit each college at two questions so we can get to everyone by the end of the hour. Now I'll turn the call over to Tim. Thanks, Andy, it would be good afternoon. I hope.

Following our prepared remarks, we will host a Q&A period during which we will limit each caller to two questions. So we can get to everyone by the end of the hour now I'll turn the call over to Tim.

Thanks, Andrew and good afternoon, I hope everyone is well.

Speaker 2: As I look at our record fourth quarter and full year 2021 results, it's clear our strategy is excelling. This extraordinary financial performance demonstrates that our brand portfolio is resonating with consumers. And we are well positioned to benefit from consumer and outdoor.

As I look at our record fourth quarter and full year 2021 results. It's clear our strategy is excelling. This extraordinary financial performance demonstrates that our brand portfolio is resonating with consumers and we are well positioned to benefit from consumer and outdoor trends, while I'm excited about our results I'm, even more optimistic about.

Speaker 3: Well, I'm excited about our results. I'm even more optimistic about our ability to realize the tangible growth opportunities that we have ahead of. I'm excited about our ability to realize the tangible growth opportunities that we have ahead of.

Our ability to realize the tangible growth opportunities that we have ahead of us fourth quarter results exceeded the financial outlook that we provided in October .

Speaker 3: Fourth quarter results exceeded the financial outlook that we provided in October .

Speaker 3: We saw positive momentum across our business throughout the quarter overpowering any regional weather trends that occurred. I'd like to thank our worldwide employees, their tremendous hard work and perseverance, enabled the company to navigate operational challenges and achieve this record financial.

We saw positive momentum across our business throughout the quarter overpowering any regional weather trends that occurred I would like to thank our worldwide employees their tremendous hard work and perseverance enabled the company to navigate operational challenges and achieve this record financial performance.

During the quarter net sales upside versus plan was primarily driven by our DTC brick and mortar and e-commerce businesses.

Speaker 3: During the quarter, net sales upside versus plan was primarily driven by our DTC brick and mortar and e-commerce business.

Speaker 3: Even as consumers return to in-store shopping, this holiday season, our e-commerce sales continue to grow rapidly.

Even as consumers return to in store shopping this holiday season, our E Commerce sales continued to grow rapidly.

Speaker 3: In our wholesale business, fall 21 cell through rates have been exceptional. Despite our best efforts to deliver product to our retail partners, wholesale sales were constrained by supply chain disruptions.

In our wholesale business fall 'twenty, one sell through rates have been exceptional despite our best efforts to deliver product to our retail partners wholesale sales were constrained by supply chain disruptions.

Speaker 3: Our retail partners are well positioned to exit the season with clean inventory.

Our retail partners are well positioned to exit the season with clean inventory positions orders for our spring and fall 'twenty two product line have been phenomenal as retailers strive to meet demand for our products.

Speaker 3: Orders for our Spring and Fall 22 product line have been phenomenal as retailers strive to meet demand for our products.

Speaker 3: Gross margin performance in the quarter was better than planned as high demand and lean inventory in the marketplace resulted in a highly favorable full price selling.

Gross margin performance in the quarter was better than planned as high demand and lean inventory in the marketplace resulted in a highly favorable full price selling environment.

Speaker 3: The combination of net sales growth, gross margin expansion, and S-GNA leverage fueled an 18.7% operating margin of the quarter.

The combination of net sales growth gross margin expansion and SG&A leverage fueled an 18, 7% operating margin in the quarter.

Speaker 3: This was the highest fourth quarter operating margin performance since 2004.

This was the highest fourth quarter operating margin performance since 2004.

Speaker 3: We exit in the year with cash and short-term investments of 895 million and no bank borrow.

We exited the year with cash and short term investments of $895 million and no bank borrowings our profitable growth trajectory and fortress balance sheet has given our board of directors the confidence to approve a 15% increase to our quarterly cash dividend for.

Speaker 3: Our profitable growth trajectory and fortress balance sheet have given our board of directors the confidence to approve a 15% increase to our quarterly cash div-

Speaker 3: For the year, we generated 25% net sales growth.

For the year, we generated 25% net sales growth.

Speaker 3: expanded operating margin by 890 basis points, and delivered 229% earnings per share growth compared to 2000.

Expanded operating margin by 890 basis points and delivered 229% earnings per share growth compared to 2020.

Speaker 3: Mountain Hardware was our fastest growing brand in 2021, with full net year sales increasing 33%, followed by Columbia, which increased 28%.

Mountain hardware was our fastest growing brand in 2021 with full net year sales, increasing 33% followed by Colombia, which increased 28%.

Speaker 3: Growth was broad-based by channel with our DTC business growing 33% and wholesale growing 18% for the

Growth was broad based by channel with our DTC business growing 33% and wholesale growing 18% for the year.

Speaker 3: 2021, our global DTC business represented 47% of net sales, including our e-commerce business, which represented 18% of the total.

In 2021, our global DTC business represented 47% of net sales, including our E Commerce business, which represented 18% of total net sales.

Speaker 3: We achieved an important milestone with full year 2021 net sales and fluted earnings per share coming in 3% and 10% above 2019 levels. Respect.

We achieved an important milestone with full year 2021, net sales and diluted earnings per share coming in at 3% and 10% above 2019 levels respectively.

Speaker 3: As we begin 2022, consumer demand for our products is incredibly strong.

As we begin 2022 consumer demand for our products is incredibly strong.

Speaker 3: Columbia Brands differentiated innovation, value proposition, and outdoor heritage, uniquely position the company, the unlock its vision to be the number one outdoor brand in the world.

The Columbia brands differentiated innovation value proposition and outdoor heritage uniquely positioned the company to unlock its vision to be the number one outdoor brand in the world.

Speaker 3: Columbia's successful Omnihitan Fintany launch is a clear example of the brand's ability to deliver compelling product to consumers global.

Columbia successful omni heat Infinity launch is a clear example of the brand's ability to deliver compelling product to consumers globally.

Speaker 3: across our emerging brand portfolio, we see phenomenal growth potential with Sarell, leading the chart.

Across our emerging brand portfolio, we see phenomenal growth potential with Sorel, leading the charge Sorel is anticipated to be our fastest growing brand in 2022, reflecting robust demand for this unstoppable function first fashion footwear brand.

Speaker 3: Cerelle is anticipated to be our fastest growing brand in 2022, reflecting robust demand for this unstoppable function first fashion footwear brand.

Mountain hardware resurgence is underway with product innovation and distribution expansion fueling continued growth in 2022.

Speaker 3: Mount Hardware's resurgence is underway with product innovation and distribution expansion fueling continued growth in 2020.

At Prana, we expect continued growth as new leadership sharpens, the brand's focus on the opportunities ahead.

Speaker 3: At Prana, we expect continued growth as new leadership sharpens the brand's focus on the opportunities ahead.

Speaker 3: Exceptional wholesale sell-through rates in 2021 and lean retail inventory levels Exit in the year are fueling robust spring and fall 22 wholesale

Exceptional wholesale sell through rates in 2021, and lean retail inventory levels exiting the year, our fueling robust spring and fall 'twenty two wholesale orders combined.

Speaker 3: Combined with our expectation for continued DTC growth, our 2022 Net Sales Outlook calls for 16 to 18 percent growth.

Combined with our expectation for continued DTC growth, our 2022 net sales outlook calls for 16% to 18% growth.

Speaker 3: Our top priority in 2022 is navigating this dynamic environment to maximize near-term sales, while continuing to invest back into the business to drive long-term profitable growth. I will provide more details regarding our 2022 financial outlook later in the call.

Our top priority in 2022 is navigating this dynamic environment to maximize near term sales, while continuing to invest back into the business to drive long term profitable growth.

I'll provide more details regarding our 2022 financial outlook later in the call.

Speaker 3: Now I'll quickly review our fourth quarter 2021 financial performance in reference year over year comparisons versus fourth quarter 2020 unless otherwise no.

Now I'll quickly review, our fourth quarter 2021 financial performance and reference year over year comparisons versus fourth quarter 2020, unless otherwise noted.

Speaker 3: Fourth quarter net sales increased 23%. Primarily driven by higher consumer demand for our products as we anniversary prior year pandemic disrupts.

Fourth quarter net sales increased 23%, primarily driven by higher consumer demand for our products as we anniversary prior year pandemic disruptions.

Speaker 3: Our DTC business increased 33% and wholesale increased 13.

Our DTC business increased 33% and wholesale increased 13%.

Speaker 3: Within our DTC business, Breckin' Mortar increased 39% and Neek Carmers increased 25%.

Within our DTC business brick and mortar increased 39% and e-commerce increased 25%.

Speaker 3: Compared to pre-pandemic fourth quarter 2019 results, our DTC brick and mortar business increased 8% and DTC e-commerce increased 76%.

Compared to pre pandemic fourth quarter 2019 results, our DTC brick and mortar business increased 8% and DTC E Commerce increased 76%.

Speaker 3: Even though supply chain disruptions can strain growth in wholesale, fall 21 cell through exceeded our expectations.

Even though supply chain disruptions constrained growth in wholesale.

Fall 'twenty, one sell through exceeded our expectations, our retail partners are well positioned to exit the season with minimal carryover inventory.

Speaker 3: Our retail partners are well positioned to exit the season with minimal carryover.

Speaker 3: Gross margin expanded 160 basis points to 52.2.

Gross margin expanded 160 basis points to 52, 2% <unk>.

Speaker 3: combined with SGNA leverage, our operating margin expanded 520 basis points compared to 4th quarter, 2020.

Combined with SG&A leveraged our operating margin expanded 520 basis points compared to fourth quarter 2020.

Speaker 3: To looted earnings per share increased 66% to $2.39.

Diluted earnings per share increased 66% to $2 39.

Speaker 3: I'll now review fourth quarter and full year net sales growth by region and brand. For this review, I'll reference constant currency net sales growth rates unless otherwise noted.

I will now review fourth quarter and full year net sales growth by region and brand with this review I will reference constant currency net sales growth rates unless otherwise noted.

Speaker 3: US net sales increased 27% in the fourth quarter and 28% for the full year.

U S net sales increased 27% in the fourth quarter and 28% for the full year.

In the quarter U S. DTC net sales increased low, 40% and wholesale increased low double digit percent.

Speaker 3: In the quarter, US DTC net sales increased low 40% and wholesale increased low double digits.

Speaker 3: Our US DTC Brick and Mortar business generated positive same store sales growth compared to fourth quarter 2019.

Our U S DTC brick and mortar business generated positive same store sales growth compared to fourth quarter 2019 levels.

Speaker 3: This notes the first positive samsaurus sales performance over 2019.

This notes the first positive same store sales performance over 2019.

Since the pandemic began.

Speaker 3: In order to support our retail partners during the peak Black Friday Cyber Monday sales period, we made the decision to constrain U.S. e-commerce marketing to slow online demand and prioritize wholesale ships.

In order to support our retail partners during the peak Black Friday Cyber Monday sales period, we made the decision to constrained U S e-commerce marketing to slow online demand and prioritize wholesale shipments.

Speaker 3: Had we not prioritized all social shippings during this period, our e-commerce sales would have been even a-

Had we not prioritized wholesale shipments during this period our e-commerce sales would have been even higher.

Overall U S wholesale shipments performed largely in line with the outlook provided on the last call as supply chain constraints limited upside potential during the quarter.

Speaker 3: Overall, U.S. wholesale shipments performed largely in line with the Outlook provided on the last call as supply chain constraints limited upside potential during the quarter.

Turning to international markets.

Speaker 3: During the fourth quarter, most regions experienced favorable recovery trends. With that said, government efforts to contain the virus impacted store traffic and consumer demand in China and in just...

During the fourth quarter, most regions experienced favorable recovery trends with that said government efforts to contain the virus impacted store traffic and consumer demand in China and in Japan.

Speaker 3: Latin America Asia Pacific Region or LAP, fourth quarter and full year net sales increased 8%.

Latin America Asia Pacific region or la.

Fourth quarter and full year net sales increased 8%.

Speaker 3: China grew mid-teens percent in the quarter, primarily reflecting higher fall 21 wholesale shipments, and to a lesser extent DTC growth.

China grew mid teens percent in the quarter, primarily reflecting higher fall 'twenty, one wholesale shipments and to a lesser extent DTC growth.

Speaker 3: lower store traffic resulting from COVID-19 related government restrictions and unseasonably warm weather tempered DTC brick and mortar performance in the quarter.

Lower store traffic, resulting from COVID-19 related government restrictions and unseasonably warm weather tempered DTC brick and mortar performance in the quarter.

Speaker 3: We remain focused on driving growth and enhancing the consumer experience in this important market. For the year, China grew low 20%.

We remain focused on driving growth and enhancing the consumer experience in this important market for the year, China grew low 20%.

Korea grew low teens percent in the quarter as favorable winter weather contributed to healthy DTC growth and solid demand for outerwear and hiking products for the year Korea grew low double digit percent.

Speaker 3: Korea grew low teens percent in the quarter as favorable winter weather contributed to healthy DTC growth and solid demand for out-of-wear and hiking products. For the year, Korea grew...

Speaker 3: We recently appointed Tony Bay as General Manager of Korea. He brings over 20 years of experience building consumer connections, leading marketplace management and driving commercial growth strategies.

We recently appointed Tony Bay as General manager of Korea. He brings over 20 years of experience building consumer connections, leading marketplace management and driving commercial growth strategies I look forward to tonys leadership as we capitalize on Korea is revitalized outdoor industry.

Speaker 3: I look forward to Tony's leadership as we capitalize on Korea's revitalized outdoor industry growth.

Growth.

Speaker 3: Japan was down slightly in the quarter. Consumer demand modestly recovered following the most recent state of emergency declaration that was in place through the end of September . For the year, Japan grew...

Japan was down slightly in the quarter consumer demand modestly recovered following the most recent state of emergency declaration that was in place through the end of September for.

For the year, Japan grew low single digit percent.

Speaker 3: LAP distributor markets were up low 20% driven by higher fall 21 wholesale order shipments compared to elevated fall 20 cancellations in the prior year. For the year LAP distributor markets were down mid teens percent as distributors work through carry over in the toy.

La AAP distributor markets were up low, 20% driven by higher fall 'twenty, one wholesale order shipments compared to elevated fall 'twenty cancellations in the prior year for.

For the year.

Distributor markets were down mid teens percent as distributors work through carryover inventory positions.

Speaker 3: Europe , Middle East, Africa region, or EMEA, fourth quarter net sales, increased 33%, driven by robust growth in both the Europe Direct and our EMEA distributor business. For the year, EMEA.

Europe Middle East Africa region, or EMEA fourth quarter net sales increased 33% driven by robust growth in both the Europe direct and our EMEA distributor business for.

For the year EMEA increased 25%.

Speaker 3: Europe Direct grew low 30% of the quarter, fueled by strong recovery in consumer demand across our DTC and wholesale businesses. For the year, Europe Direct grew low 20%.

Europe direct grew low 30% in the quarter fueled by strong recovery in consumer demand across our DTC and wholesale businesses for the year Europe direct grew low 20%.

Speaker 3: Our EMEA distributor business was up high 30% in the quarter and the full year. Fourth quarter growth was driven by leadershipments of higher fall 21 wholesale orders and higher spring 22.

Our EMEA distributor business was up high 30% in the quarter and the full year.

Fourth quarter growth was driven by later shipments of higher fall 'twenty, one wholesale orders and higher spring 'twenty two orders.

Speaker 3: Canada and NET sales increased 14% in the fourth quarter. Primarily driven by improved DTC performance and higher fall 21 host.

Canada net sales increased 14% in the fourth quarter, primarily driven by improved DTC performance and higher fall 'twenty, one wholesale shipments for the year, Canada net sales increased 18%.

Speaker 3: For the year, Canada net sales increased. H...

Speaker 3: All right, looking at performance by brand, Columbia brand net sales increased 28% of the fourth quarter and 27% for the full year. During the quarter, growth was broad based across Outerware, Sportsware and to a lesser extent.

Alright, looking at performance by brand Columbia brand net sales increased 28% in the fourth quarter and 27% for the full year.

During the quarter growth was broad based across outerwear sportswear and to a lesser extent footwear we.

Speaker 3: We successfully executed our largest product innovation launch in the company's history, Omni Heat Infinity. The launch featured a global multi-channel marketing campaign that included traditional, social, and digital media outlets. You may have seen our Omni Heat Infinity commercials during NFL games broadcast on Fox and the NFL net.

We successfully executed our largest product innovation launch in the company's history.

The heat infinity.

The launch featured a global multichannel marketing campaign that included traditional social and digital media outlets you may have seen our omni heat infinity commercials during NFL games broadcast on Fox and the NFL network on the heat Infinity has been covered extensively by U S media outlets with over 50 earned.

Speaker 3: Home heat infinity has been covered extensively by US media outlets with over 50 ear in placement.

<unk> and combined media coverage, surpassing 700 million impressions.

Speaker 3: and combine media coverage surpassing 700 million impressions.

Speaker 3: As we mentioned on the last call, OmniHeat Infinity will be the first Columbia product to reach the surface of the moon. Columbia partnered with Intuitive Machines to be part of their Nova Sea Lunar Lander. The launches referred to as the

As we mentioned on the last call omni heat Infinity will be the first Columbia product to reach the surface of the moon.

<unk> partnered with intuitive machines to be part of their Nova C lunar lander.

The launches scheduled for later this year.

Speaker 3: on the product partnership front. We saw a successful launch of our Star Wars Boba Fett collection in December .

On the product partnership front, we saw a successful launch of our Star Wars Boba Fett collection in December <unk>.

Speaker 3: inspired by the most notorious bounty hunter in the galaxy and infused with Columbia DNA, this collaboration created significant buzz for our...

Inspired by the most notorious bounty hunter in the Galaxy and infused with Columbia DNA. This collaboration created significant buzz for our brand. The launch helped drive the highest sales volume hour in Colombia Dotcom history.

Speaker 3: The launch helped drive the highest sales volume hour in columbia.com.

Since our partnership with Disney and Lucasfilm began star Wars collections have generated close to 3 billion earned media impressions.

Speaker 3: This week, the USA curling team is sweeping the ice in style wearing Columbia as the official uniform jersey.

This week the USA curling team is sweeping the ice and style where in Colombia as the official uniform Jersey.

Speaker 3: We work closely with all members of the team to customize jerseys, jackets, pants, and accessories. Technology elements include both our OmniWIC for accelerated moisture evaporation and OmniHeat Infinity to stay warm in between matches. Best of luck to the entire U.S.

We worked closely with all members of the team to customized jerseys jackets pants and accessories technology elements include both our omni work for accelerated moisture evaporation and omni heat infinity to stay warm in between matches best of luck to the entire USA curling team.

Speaker 3: I'm pleased to announce that the Columbia brand made Forbes Halo 100 list. The inaugural list was put together using consumer feedback on over 2,000 brands to measure the impact these companies are creating for customers.

I am pleased to announce that the Columbia brand made Forbes' Alo 100 list. The inaugural list was put together using consumer feedback on over 2000 brands to measure the impact these companies are creating for customers.

Speaker 3: Columbia debuted at number 25 on the list and was ranked number one in terms of perceptions of brand values and trust.

<unk> debuted at number 25 on the list and was ranked number one in terms of perceptions of brand values and trust.

We attribute this success to colombia's approach ability across a broad demographic of consumers.

Speaker 3: We attribute the success to Columbia's approachability across a broad demographic of consumers.

Speaker 3: Our focus on durability and innovation clearly resonates with consumers of all backgrounds.

Our focus on durability and innovation clearly resonates with consumers of all backgrounds.

Turning to our emerging brand portfolio Sorel brands net sales increased 9% in the quarter and for the full year in the quarter net sales growth was led by strong performance of the winter style category.

Speaker 3: Sarol Brands' net sales increased 9% in the quarter and for the full year. In the quarter, net sales growth was led by strong performance of the winter style.

Speaker 3: In addition to Sorrell's DTC e-commerce focus, the brand is fostering strategic retail partnerships to elevate the brand at wholesale.

In addition to <unk> DTC E Commerce focus the brand is fostering strategic retail partnerships to elevate the brand at wholesale.

Speaker 3: During the quarter, Zappos.com launched in the first of its kind, pop up sneaker shop with Cyril as the exclusive partner. We noted an immediate uptick.

During the quarter Zappos Dot com launched a first of its kind pop up sneaker shop with Sorel as the exclusive partner.

We noted an immediate uptick in sales in the first week.

Speaker 3: On the marketing front, Sir Royal recently wrapped up season four of its popular podcast, The Step, which features a...

On the marketing front Sorel recently wrapped up season four of its popular podcast the step which features unstoppable women.

Speaker 3: The podcast has been ranked within the top 20 entrepreneurial podcast on Apple and has reached over 12 million.

The podcast has been ranked within the top 20 entrepreneurial broadcasts on Apple and has reached over 12 million people.

Speaker 3: So we're all successful evolution to a year round. Function first, fashion footwear brand is evident in the breadth of popular non-insulated style.

Sorel successful evolution to a year round function first fashion footwear brand is evident in the breadth of popular non insulated styles to put this in perspective in 2021, only 15% of <unk> North America sales were in the insulated winter utility boots that you.

Speaker 3: to put this in perspective in 2021, only 15% of cereals North America's sales were in the insulated winter utility booths that used to define the brand.

Houston defined the brand.

Speaker 3: 85% of sales were in the non-insulated boots, wedges, heels, sneakers, and sand.

85% of sales were in the non insulated boots.

Wedges heels sneakers and sandals.

Speaker 3: The brand success in the hyper competitive multi-billion dollar sneaker category speaks to the serials brand heat and trend setting design.

The brand's success in the hyper competitive multibillion dollars sneaker category speaks the Sorel brand heat and trendsetting designs.

Speaker 3: I encourage you to check out Sir Rills' first-ever TV commercial on YouTube.

I encourage you to check out <unk> first ever TV commercial on Youtube.

Speaker 3: The ad spotlight, the Spring 22 Kinetic Line, and features an all-female cast and female lead production crew. Title, keep moving. The commercial shows the spirit of the Cerebral Bram.

Add spotlights the spring 'twenty two kinetic line and features an all female cast and female led production group titled keep moving the commercial shows the spirit of the Sorel brand.

Speaker 3: This has been an amazing transformation for a brand that we paid less than $10 million for over 20 years.

This has been an amazing transformation for a brand that we paid less than $10 million for over 20 years ago.

Speaker 3: Today we see a clear path for Shirell to be a billion dollar brand.

Today, we see a clear path for Sorel there'll be a 1 billion dollar brand.

Speaker 3: With this goal in mind, we're investing in demand creation and product to fuel growth in 2022. 2022.

With this goal in mind, we are investing in demand creation and product to fuel growth in 2022 and beyond.

Speaker 3: We anticipate Sorrell's growth rate to accelerate in 2022 as our factory partners scale capacity.

We anticipate <unk> growth rate to accelerate in 2022, as our factory partners scale capacity.

Speaker 3: For the year, we anticipate Serels net sales growth to approach 30%.

For the year, we anticipate <unk> net sales growth to approach 30%.

Prana net sales decreased 7% in the quarter, but were up 8% for the full year.

Speaker 3: Prana net sales decreased 7% in the quarter, but we're up 8% for the full year.

Speaker 3: Lowered head sales reflect the impact of delayed fall 21 receipts and a soft DTC e-commerce.

Lower net sales reflect the impact of delayed fall 'twenty, one receipts and a soft DTC E. Commerce business. We are encouraged by fall 'twenty, one sell through rates with our wholesale partners.

Speaker 3: We are encouraged by Fall 21 cell through rates with our wholesale.

Speaker 3: During the quarter, Prana had strong sales with its popular stretch Zion product platform as the brand transitions to its new high performance sustainable Reezy on Fab.

During the quarter Prana had strong sales with its popular stretched Zion product platform as the brand transitions to its new high performance sustainable.

Zion fabric in 2022, we expect continued focus and growth in all channels as new leadership sharpens the brand's focus.

Speaker 3: 2022 we expect continued focus and growth in all channels as new leadership sharpens the brain.

Non hardware net sales increased 30% in the quarter and 33% for the year.

Speaker 3: Mountain Hardware Net Sales increased 30% in the quarter and 33% for the year. I'd like to congratulate the Mountain Hardware team. The brand success in 2021 is not just about the growth rate, it's about the quality of that growth that's most encouraged.

Like to congratulate the mountain hardware team the brand success in 2021 is not just about the growth rate, it's about the quality of that growth Thats most encouraging.

Speaker 3: success of new products and distribution expansion with strategic retail parts.

The success of new products and distribution expansion with strategic retail partners fueled high quality growth and the strongest growth gross margin performance in over a decade.

Speaker 3: You will have high quality growth and the strongest growth, growth margin performance in over a decade.

Speaker 3: In the quarter, net sales growth was led by strong, fall 20 and wholesale performance, in addition to healthy DTC gains. By category, strong cell through was broad-based across snow sports, sportswear, and the popular stretch down.

In the quarter net sales growth was led by strong ball 21 wholesale performance. In addition to healthy DTC gains by category strong sell through was broad based across snow sports sportswear and the popular stretch down collections.

Speaker 3: The brand added over 350 new points of distribution this season with strong cell through performance noted at top.

The brand added over 350, new points of distribution in the season with strong sell through performance noted at top retailers.

Speaker 3: In 2022, we expect continued mountain hardware and net sales growth. Management is keenly focused on solidifying the brand's identity, growing brand awareness, and building on the successes of 2020.

In 2022, we expect continued mountain hardware and net sales growth.

Management is keenly focused on solidifying the brand's identity.

Growing brand awareness and building on the successes of 'twenty one.

Speaker 3: We are also investing in talent to further strengthen the brand team and scale the business. I will now discuss our 2022 financial outlook. This outlook is...

We are also investing in talent to further strengthen the brand team and scale the business.

I will now discuss our 2022 financial outlook. This.

This outlook and commentary includes forward looking statements.

Speaker 3: Please see our CFO Commentary and Financial Review presentations for additional details and disclosures related to these statements.

Please see our CFO commentary and financial review presentations for additional details and disclosures related to these statements.

Speaker 3: Our 2022 outlook contemplates 16% to 18% year-over-year net sales growth.

Our 2022 outlook contemplate, 16% to 18% year over year net sales growth.

Speaker 3: I'd note that wholesale orders for our 2022 product line support even stronger growth. And we are purchasing inventory to meet this.

Note that wholesale orders for our 2022 product line support.

Even stronger growth and we are purchasing inventory to meet this higher demand we.

Speaker 3: We are calibrating the forecast we're giving you today to reflect ongoing supply chain bottlenecks, which are anticipated to continue.

We are calibrating the forecast, we're giving you today to reflect ongoing supply chain bottlenecks, which are anticipated to continue.

To the extent, we can mitigate the supply chain constraints, we see potential upside to our financial outlook.

Speaker 3: To the extent we can mitigate these supply chain constraints, we see potential upside to our financial outcome.

We expect net sales growth to be broad based across our brands regions and channels with Sorel anticipated to be the fastest growing brand in the portfolio.

Speaker 3: We expect net sales growth to be broad-based across our brands, regions and channels with Cyril anticipated to be the fastest growing brand in the portfolio.

Speaker 3: From a category perspective, we expect the year over year growth rate of footwork to outpace a peril.

From a category perspective, we expect the year over year growth rate of footwear to outpace apparel.

We worked with our factory partners to successfully expand footwear capacity in 2022 across both the Sorel and the Columbia footwear businesses.

Speaker 3: We work with our factory partners to successfully expand footwork capacity in 2022 across both the Surreal and the Columbia footwork business.

Speaker 3: Even with this additional footwork capacity, we will not be able to fulfill all the demand in the marketplace during the year.

Even with this additional footwear capacity, we will not be able to fulfill all the demand in the marketplace during the year.

Speaker 3: We are continuing to work with our factory partners to further expand capacity for 2023 in the U.S. We are continuing to work with our factory partners to further expand capacity for 2020 in the U.S.

We are continuing to work with our factory partners to further expand capacity for 2023 and beyond.

Speaker 3: Our 2022 Net Sales Outlook includes the benefit of pricing additions we've taken to mitigate inflationary pressure. Price increases varied by market.

Our 2022 net sales outlook includes the benefit of pricing additions, we've taken to mitigate inflationary pressure.

Price increases varied by market and product category in the U S. On average we increased pricing by a mid single digit percent for our spring 'twenty two product line and a high single to low double digit percent for our fall 'twenty two product line.

Speaker 3: In the US, on average, we increased pricing by a mid-single-digit percent for our spring 22 product line and a high single to low double-digit percent for our fall 22 product.

In this inflationary environment pricing power is critical to profitable growth.

Speaker 3: Gross margin is expected to contract approximately 160 basis points to approximately 50%.

Gross margin is expected to contract approximately 160 basis points to approximately 50%.

Speaker 3: The decline in gross margin performance compared to 21 reflects continued elevates.

The decline in gross margin performance compared to 21 reflects.

Continued elevated freight costs.

Speaker 3: potential for more normalized promotion and trade terms across our DTC and wholesale business.

The potential for more normalized promotion and trade terms across our DTC and wholesale businesses.

Speaker 3: a higher proportion of wholesale sales, which generally carry lower margin than DTC. Partially offset by price increases, we've taken to mitigate the impact of higher product in-

A higher proportion of wholesale sales, which generally carry lower margin the DTC, partially offset by price increases we've taken to mitigate the impact of higher product product input costs.

Speaker 3: Our 2022 Gross Margin Outlook of 50% represents the second highest gross margin performance in our company's history just behind our...

Our 2022 gross margin outlook of 50% represents the second highest gross margin performance in our company's history.

Just behind our record 2021 performance.

Speaker 3: We expect SGNA expenses to grow to slightly slow rate the net sales. Inclusive of strategic investments were making to drive long-term profitable growth.

We expect SG&A expenses to grow at a slightly slower rate than net sales.

<unk> of strategic investments, we're making to drive long term profitable growth.

Speaker 3: On the technology front, we're investing in our digital and analytics capabilities to leverage consumer data, enhance the consumer experience across our platforms, and drive efficiencies across the organization.

On the technology front, we are investing in our digital and analytics capabilities to leverage consumer data enhance the consumer experience across our platforms and drive efficiencies across the organization.

Speaker 3: We're investing to enhance our supply chain capabilities to expand distribution capacity, improve inventory management, and adapt to shifts in our sales.

We're investing to enhance our supply chain capabilities to expand distribution capacity improve inventory management and adapt to shifts in our sales mix.

Speaker 3: The man creation investments are expected to increase as a percent of sales to 6% compared to 5.9% in 2021. We're also investing to grow.

<unk> creation investments are expected to increase as a percent of sales to 6% compared to five 9% in 2021.

We're also investing to grow our DTC store fleet in North America, our current plans call for opening approximately 15 new stores are.

Speaker 3: North America are current plans call for opening approximately 15 new stores.

Speaker 3: Our store growth plans include opening several branded stores with an updated format that we're testing. These stores are an authentic Columbia brand brick.

Our store growth plans include opening several branded stores with an updated format that we're testing. These stores are on athletic Columbia brand.

Brick and mortar experience showcasing a wider range of products, including premium and entry point product compared to the Columbia flagship stores that we closed in 2020. These smaller format stores are in non high street locations with lower rents and better economics.

Speaker 3: showcasing a wider range of product, including premium and entry point product. Compared to the Columbia flagship stores that we closed in 2020.

Speaker 3: These smaller format stores are in non-high street locations with lower rents and better records.

We expect operating margin to be in the range of 13% to 13, 5% compared to 14, 4% in 2021.

Speaker 3: We expect operating margin to be in the range of 13 to 13.5% compared to 14.4% in 2020.

Speaker 3: I note that the high end of our 2022 range is 50 basis points above our 2019 operating margin of 30.

I would note that the high end of our 2022 range is 50 basis points above our 2019 operating margin of 13%. This improvement is net of an incremental 50 basis point investment in demand creation.

Speaker 3: This improvement is net of an incremental 50 basis point investment in demand creation, higher freight expenses, and in

Higher freight expenses and inflationary pressures.

Speaker 3: We remain committed to expanding operating margin over time, but year to year fluctuations are not always linear. We have a strong track record of improving profitability over the last decade.

We remain committed to expanding operating margin over time, but year to year fluctuations are not always linear we have a strong track record of improving profitability over the last decade.

Speaker 3: This operating performance results in diluted earnings per share outlook of $5.50 to $5.80.

This operating performance results in diluted earnings per share outlook of $5 50.

To $5 80.

With the tremendous momentum we see across our business I believe it's important for the investment community to have an opportunity to dive deeper into the brand strategies and products that we are fueling this growth.

Speaker 3: With a tremendous momentum we see across our business, I believe it's important for the investment community to have an opportunity to dive deeper into the brand's strategies and products that we're fueling this growth.

Speaker 3: We are currently planning to host our first ever analyst day at our campus here in Portland this fall.

We are currently planning to host our first ever analyst day at our campus here in Portland This fall.

Speaker 3: I look forward to sharing the date and the details as we finalize our

I look forward to sharing the date and the details as we finalize our plans.

In summary.

Speaker 3: In summary, I'm confident we have the right strategy to unlock the significant growth opportunities we see across the business.

I am confident we have the right strategy to unlock the significant growth opportunities, we see across the business and.

Speaker 3: And we are investing in our strategic priorities to drive global brand awareness and sales growth through increased focus-demand creation investments.

And we are investing in our strategic priorities.

To drive global brand awareness and sales growth through increased focused demand creation investments.

Speaker 3: Enhance, consumer experience, and digital capabilities in all of our channels, R.'

Enhance consumer experience and digital capabilities in all of our channels and geographies.

Expand and improve global direct to consumer operations with supporting processes and systems.

Speaker 3: expand and improve global direct to consumer operations with supporting processes and systems.

Speaker 3: and invest in our people and optimize our organization across our portfolio of grants. That concludes our prepared remarks.

And invest in our people and optimize our organization across our portfolio of brands.

That concludes our prepared remarks.

We welcome your questions for the remainder of the hour.

Speaker 1: Thank you. At this time, we will be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tunnel indicate your line is in the question, you. You may press star two if you'd like to remove your question from the queue.

Thank you.

At this time, we'll be conducting a question and answer session if.

If you'd like to ask a question. Please press star one on your telephone keypad.

Mason Toner indicate your line is in the question queue you.

You May press star two if you'd like to remove your question from the queue.

Speaker 1: For participants using speaker equipment and maybe necessary to pick up your hands up before pressing the star keys.

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Speaker 1: Our first question comes from the line of Bob Durable with Guggenhutton Securities. Please proceed with your question. Hi, a good evening.

Our first question comes from the line of Bob <unk> with Guggenheim Securities. Please proceed with your question.

Good evening.

Hey, Bob.

Speaker 4: I get two questions Tim. The first one is, I don't know if you could take it or Jim would take it, but as you think about...

I guess two questions. The first one is I don't know if you could take it or Jim would take it but.

As you think about the guidance and the full year 'twenty to expectations at this point.

Speaker 4: The guidance in the full year, 22 expectations at this point.

Speaker 4: Can you talk a little bit about the order book, you know, what really, what transpired for the spring period? I don't know if you could give us any of the rates, but you know, really what you're seeing, how book you are for fall on the wholesale side. And I guess just when you think about in your-

Can you talk a little bit about the order book, what really what transpired for the spring period I don't know if you could give us any of the rates, but really what youre seeing how booked you are for fall.

On the wholesale side and I guess, just when you think about in your guidance.

Speaker 4: If you could maybe just help us understand the DTC assumptions, either in your stores for the full year, or even the digital success that you've had, lapping that, that would be helpful.

You could maybe just help us understand the DTC assumptions either in your stores for the full year.

Or even the digital success that <unk> had lapping that that would be helpful.

Certainly well.

Speaker 5: Certainly. Well, as a relation to the order book, the order book is grown.

As it relates to the order book the order book has grown.

Significantly and substantially over the last period so.

Speaker 5: significantly and substantially over the last period. So it gives us a lot of confidence in terms of the guidance that we gave you today for the full year. Now we did, we assume that there will be continued pressure on logistics and potentially closures of factories et cetera during the year. So are anticipated.

It gives us a lot of confidence in terms of the guidance that we gave you today for the full year now we did.

We assume that there will be continued pressure on logistics and potentially.

Those are some factories et cetera during the year, so our anticipated.

Speaker 3: Reveals are lower than what we're buying inventory for. So we expect that there's an opportunity across all the brands and geographies that we can exceed the guidance today that we gave you. But that's based on our confidence in the order book which we have in hand.

Revenues are lower than what we are buying inventory for so we expect that there is an opportunity across all of the brands and geographies that we can exceed the guidance today that we gave you but thats based on our confidence in the order book, which we have in hand.

Speaker 5: As it relates to the DTC business, also very strong. And remembering that we're dealing with lower traffic rates in almost every place that we do business. The traffic occasionally is in the case of Japan, has been mandated, closed nearly half of last year. So we're dealing with traffic numbers that are down, but the brick and mortar business has been...

As it relates to the DTC business.

Also very strong and remembering that we're dealing with lower traffic rates in almost every place that we do business.

Traffic.

Occasionally.

So Japan has been mandated closed.

Nearly half of last year. So we're dealing with traffic numbers that are down, but the brick and mortar business has been.

Speaker 3: robust and and quite solid and I think it's a testament to the brand and also the

Robust and quite solid and I think it's a testament to the brand and also the.

Speaker 5: the outdoor experience that people in many cases are trying for the first time. Our digital business was also quite good and the investments that we're making in that area of the business are gonna be...

Outdoor.

Variance that people.

In many cases are trying for the first time, our digital business was also quite good and the investments that we're making.

In that area of the business are going to be.

Speaker 3: quite large over the next 12 months and probably beyond to give ourselves the opportunity to become a better supplier in that area. And all of us with the background that we consider ourselves really to be a wholesale supplier. And so we expect our business will be good with our wholesale partners as well.

Quite large over the next 12 months and probably beyond.

I think to give ourselves the opportunity to become better.

Supplier in that area.

In August with the background that we consider ourselves really to be a wholesale supplier.

So we expect our business will be good.

Our wholesale partners as well.

Speaker 4: Okay. And Tim, just a follow up question. So I think the BW collection launched, I don't know if it was yesterday or recently. I'm just wondering if you had any sort of comments on how that started. And are we expecting an LC collection for Luke Holmes anytime soon?

Got it and Tim just a follow up question.

So I think the BW collection launched I don't know it was yesterday or recently.

I was just wondering if you had any sort of comments on how that started and are we expecting an LC collection for Luke Combs anytime soon.

Speaker 3: Actually, well, let me answer the first question about Bala who's been a terrific

Actually.

Well, let me answer the first question about Barber, who has been a terrific ambassador for the brand.

Speaker 3: Ambassador for the brand, he's a true outdoors person and I think our affiliation with him and the affiliation and affinity that our PFG customer has with NASCAR has been just spectacular.

He's a true outdoors person and I think our affiliation with him and the affiliation and affinity there our PFG customer have with NASCAR has been spectacular so.

We expect that's going to continue and we'll have more of these capsule collections for both Bob in the future and also we're going to be launching a Luke combs.

Speaker 3: We expect that's going to continue and we'll have more of these capsule collections.

Speaker 3: for both Baba in the future. And also we're going to be watching Luke Holmes

Speaker 3: hunting collection, beginning with sometime later in this fall.

Putting collection beginning with.

Sometime later this fall.

Speaker 3: And the expectations there is that's going to also be a significant interest to

And with the expectations. There is that that's going to also be.

Significant interests too.

Speaker 3: to fans of Luke's and it's been exciting stuff. I've seen several of the samples, it looks really cool.

Fans of Luke's.

Yes.

An exciting stuff I've seen several of the samples it looks really cool.

Well, congratulations and best of luck.

Thanks.

Speaker 1: Our next question comes from the line of Lauren Fesolescu with BNP Parabas Xane. Please proceed with your question.

Our next question comes from the line of Laurence That's Alaska with BNP Paribas Exane. Please proceed with your question.

Speaker 5: Oh, good afternoon. Thank you very much for taking my question. Congrats on our really strong finish to the year. I'd love to ask about

Good afternoon, and thank you very much for taking my question Congrats on a really strong finish to the year.

Love to ask about.

Speaker 5: The first half guidance with regards to high teens to low 20% growth. I think, remind me, but I think you guys talked about spring, 22 wholesale, the up over 30%. Is that still the case as we think about the top line? Is it how do you square away with that with regards to DTC component for the first half?

The first half guidance.

With regards to high teens to low 20% growth I think remind me, but I think you guys talked about.

Spring 'twenty to wholesale.

Over 30% is that still the case as we think about.

The top line and then how do you square away with that with regards to DTC component for the first half.

So your recollection is correct we talked in October about our order book for the spring season for our wholesale business BN plus 30% as we saw orders continue to come in and improve as Tim touched on given the supply chain disruptions and delays we've softened our forecast.

Speaker 6: So yeah, Laurent, your recollections correct. We talked in October about our order book.

Speaker 6: for the spring season for a whole set of business being plus 30% as we thought orders continue to come in and improve. As Tim touched on, given the supply chain disruption and delays, we've softened our forecast a bit, given the challenges from a supply chain perspective. And when you take that combined with...

<unk>.

Given the challenges from a supply chain perspective on when you take that combined with the growth that we anticipate from a direct to consumer perspective, that's what gets you to that high teen low 20, I think if you were to imply growth in there youre going to get.

Speaker 6: the growth that we anticipate from a direct to consumer perspective. That's what gets you to that high team low 20. I think if you were to imply growth and there you're gonna get.

Speaker 6: growth for the D to C business and

Growth for the.

D to C business.

Yes.

Speaker 6: Low double digit range. It'll be it'll be a bit better than that As we as we've adjusted that whole subbusiness for some of the supply chain disruptions

Low double digit range there'll be it'll be a bit better than that.

As we've adjusted that wholesale business for some of the supply chain disruptions.

Speaker 5: Okay, it's very helpful. And then I think on your slide 18 or 19, you're calling for gross margin to be down 300 that's in the first half. I'd love to know if you could, Jim, as you could possibly parse out, is that all due to supply chain constraints incremental freight? And how do we think about that, that 1-H?

Okay very helpful and then.

I think on your slide 18, or 19, you're calling for gross margins to be down 300 beds in the first half.

I'd love to know if you could.

Jim if you could possibly parse out like is that all due to.

Supply chain constraints incremental freight.

And how do we think about that that one H EPS range that youre, calling for 90 to $1 10 are you assuming that when we go back to the store called <unk> <unk> is the last quarter and then most of the all the EPS would be driven in the first quarter.

Speaker 5: P.S. Range that you're getting calling for 90 cents to $1.10. Are you assuming that we go back to the historical rate where 2Q is a loss quarter and then most of the all the P.S. would be driven in the first quarter?

Speaker 6: Let me touch on the gross margin contraction first for a moment. You'll recall ocean freight surcharges, we began to see those increase at a pretty significant rate dated back to the mid part of 2021.

Let me touch on the.

The gross margin contraction first for a moment you will recall ocean freight surcharges, we began to see those increase at a pretty significant rate David back to the mid part of 2021 and so as we continue to see those elevated costs in the first part of this year, we've not seen those abate.

Speaker 6: And so as we continue to see those elevated costs in the first part of this year, we've not seen those, update all that much.

All that much.

Speaker 6: We're going up against that to see a difficult comp. And so of that 300 basis point of gross margin contraction in the first half.

We're going up against a difficult comp and so that 300 basis points of gross margin contraction in the first half.

Speaker 6: You know, our ocean freighted back to lone will be north of that. It'll be 350-ish in that order of magnitude. So there's some other puts and takes in our overall gross margin. And then it pertains to the outlook between Q1 and Q2. I don't think we've provided a lot of detail on that. Other than to say that we believe will be modestly profitable in the second quarter.

Our ocean freight impact alone will be north of that it'll be $3 50 ish.

In that order of magnitude. So there is there some other puts and takes.

Our overall in our overall gross margin and then as it pertains to the.

The outlook between Q1 and Q2 I don't think we've provided a lot of detail on that other than to say that we believe will be modestly profitable in the second quarter.

Speaker 5: Okay, very helpful. And last question, your own innovation. Great to hear about infinity. You had black dot, you had zero last year. Tim, should we brace ourselves for more technology coming forward? Yeah, we've lost.

Okay very helpful.

Question here on innovation, great to hear about Infinity, we had blocked off you had zero last year.

Should we should we brace ourselves for more technology coming forward.

Yes, we've launched a new.

Technology as it relates to heating.

Speaker 3: technology as it relates to heating that's applicable to lighter weight myths and fleas we're calling it helix.

Applicable to lighter weight knit and fleece were calling at helix.

Speaker 3: It's it's quite dramatic in terms of its appearance.

It's quite dramatic in terms of its appearance.

Speaker 3: on the exterior of the garments. And we're pretty excited about that, because it really opens up more technology to probably one of our largest.

On the exterior of the garments and we're pretty excited about that because it really opens up more technology to probably one of our largest product categories, which is fleece and lightweight knit so.

Speaker 3: product categories which is fleece and lightweight knit so

Speaker 5: It's going to be exciting as we'll receive. And we're looking forward to having it be part of the showcase when we talk about the brand. All the brands in the innovation we have loaded into the products during our September investor day.

That's going to be exciting is well received and we're looking forward to having it be part of the showcase when we talk about.

The brand all of the brands and the innovation, we have loaded into the products.

During our September Investor day.

Great looking forward to that.

Thank you. Our next question comes from the line of Mexico, and that's with Seaport Global. Please proceed with your question.

Speaker 1: Thank you. Our next question comes from the line of Mitch Gumitz with Seamport Global. Please proceed with your question.

Speaker 2: I guess, thanks for taking my questions. Yeah, I wanted to follow up on Boss Question earlier about the order bucks because you guys have referenced spring not only again today, but on the last call. And I would imagine you're pretty far into getting your fall orders. Could you give us any numbers behind that? I mean, is that order buck up double digits? Is that a fair?

Hi, guys. Thanks for taking my questions I wanted to follow up on Bob's question earlier about the order books, because you guys have referenced spring not at all.

Again today, but on the last call.

Imagine you're pretty far into getting your fall orders could you give us any numbers behind that I mean does that order book up double digits is that fair.

Assumption.

Yes.

Speaker 5: Yeah, I mean, Jim, I think give you more specifics, but again, the order book was incredibly strong. And we received it much earlier globally than we have in the past. So it just attest them into the brand strengths and customers realizing that they all need to give us their orders earlier.

Jim might be giving you more specifics, but again the order book was incredibly strong and we received it much earlier globally than we have in the past. So it's just a testament to the brand strengths and customers realizing that.

You'll need to give us their orders earlier.

Speaker 5: You know, in order to help us all avoid the issues we've had in the past.

In order to help us all avoid the issues we've had in the past.

Speaker 6: logistics. Yeah, and it's just just add a little more color to that. As Tim touched on, orders came in substantially earlier than they ordinarily do. We're effectively a 100% book for the fall season, and that was in part due to the fact that with longer lead time.

Yes, Mitch just just.

To add a little more color to that as Tim touched on orders came in substantially earlier than they ordinarily do.

We're effectively 100% booked for the fall season, and that was in part due to the fact that with longer lead times from a logistics standpoint, where we're getting our purchase orders in sooner.

Speaker 6: from a logistics standpoint, we were getting our purchase orders in sooner to to compensate for a portion for for those facts.

To compensate for a portion for those stacks.

Speaker 6: And then as it relates to the overall growth in that order book, it's well above a 20% level in the orders that we see today.

And then as it relates to the overall growth net order book well above 20%.

Level and in the orders that we see today.

Speaker 2: Okay. And given the strength of that order book, the fact that you guys raised prices, you know, I think you said high single digits to low double digits in the U.S., it doesn't sound from those numbers that there was a whole lot of pushback to that.

Okay.

Given the strength of that order book effect that you guys raised prices I think you said high single digits to low double digits in the U S.

It doesn't sound.

Those numbers that there was a whole lot of pushback to that.

Well nobody likes price increases and.

Speaker 3: Well, you know, nobody likes price increases and

Speaker 3: I wouldn't say people were thrilled with it, but, you know, we got a much larger order book than we had. And so we we assume that the pricing power that the brands have will carry that will carry those additional charges. And now it's.

I wouldn't say people were thrilled with it but we got a much larger order book than we had and so we assume that the pricing power that the brands have will carry that.

We were carrying those additional charges and.

No.

Speaker 5: It looks like it's going to be a terrific year, barring any particular unknown work COVID problems or logistical issues, which appear that, in many respects, they're moderating. Ladies, certainly later in the year.

It looks like it's going to be a.

Terrific year barring.

Barring any particular.

Unknown.

Covid problems or logistical issues, which appear that in many respects there. They are moderating latest certainly later in the year.

And then lastly, you mentioned that you expect relative your fastest growing brand as youre approaching 30% year over year again, I assume that is reflected in the order books as well.

Speaker 2: And then Tim, lastly, you mentioned that you expect to relive your fastest growing brand, that's your approaching 30% year-to-year. Again, I assume that is reflected in the order books as well. And you expect more of that growth on a percentage basis to come in the first half, just given the reception that you're getting to the spring summer product in that brand.

More of that growth on a percentage basis to come in the first half just given the reception that you're getting into the spring summer product in that brand.

Speaker 3: Well, I think there'll still be very nice growth in the back half of the year, but it's been incredible, the response to the Sorrel brand. And it's really rotation away from being a purely winter brand to being a brand that's year round, which will be a big part of its future growth. And there's a number of things about the footwear business.

Well I think there'll still be.

Very nice growth in the back half of the year, but it's it's been incredible the response of the Sorel brand and it's really rotation.

Way from being a purely winter brand to being a brand thats year round, which will be a big part of its future growth and.

There's a number of things about the footwear business.

Speaker 5: Unfortunately right now the constraint on availability of product is hurting us, but the footwork business in general looks to be very important to the company's future. And Sovereil will lead the way there with the tightly differentiated products designs.

Fortunately right now the <unk>.

Australia.

Availability of product is hurting us, but the footwear business in general looks to be very <unk>.

So the company's future and Sorel will lead the way there with its highly differentiated products designs.

Okay, great. Thanks, and good luck.

Thanks Mitch.

Our next question comes from the line of Martin <unk> with UBS. Please proceed with your question.

Speaker 7: Our next question comes from the line of Mauricio Serna with UBS. Please proceed with your question. Great. Thanks for taking my question and congratulations.

Great. Thanks for taking my question and congratulation on the results.

Speaker 8: I wanted to ask about, if you could speak a little bit more about the outdoor category and tailwinds.

I wanted to ask about.

Could speak a little bit more about the outdoor category and tailwind that you see.

Speaker 8: you know, for 2022, I mean, how much, like, growth, underlying growth of the category are you seeing? And then maybe we could talk a little bit more, I mean, you talked about the price increase that you're taking in the first half and second half, I mean, how does that reflect the anticipated cost?

For 2022, I mean, how much like growth underlying growth in the category are you seeing and then maybe if you could talk a little bit more I mean, you talk about the price increases.

Taking in the first half and second half I mean, how does that.

Reflect the anticipated cost inflation that you're seeing in along your on your businesses. Thank you.

Speaker 5: Certainly. Well, you know, we talk about the outdoor business and the importance of that, especially it's the offer of safety for families that want to go outside and have a place that where they can be with their...

Certainly well, we talk about the outdoor business.

The importance of that especially it's.

The offer of safety for families that want to go outside and have a placement where they can be with her.

Speaker 3: and be comfortable outdoors without a mask, perhaps. But what we're really seeing is an acceleration of these already begun.

And you'd be comfortable outdoors with without a mask perhaps.

But what we're really seeing is is that in.

<unk> already begun.

Speaker 3: casualization of the workplace, casualization of how people are living their lives. I think the fact that the outdoor apparel industries has been a real beneficiary of that is really supercharged when people actually use the products outdoors. So we would expect that that's going to continue to be a tailwind for the company, for all the brands, not just the Columbia brand.

Casualization of the workplace Casuals nation of how people are living their lives and I think the fact that the outdoor apparel industries has been a real beneficiary of that.

He is really <unk>.

Supercharged when people actually use the products outdoors.

So we would expect that that's going to continue to be a tailwind for the company.

For all of the brands not just the Columbia brand.

Speaker 6: And that is a related to the latter part of that question, regarding the pricing, increases, and the inflationary pressure. As I noted earlier, did you see in our outlook, our first half gross margin being down, 300 basis points.

And then as it relates to the latter part of that question regarding the price increases and the inflationary pressure.

I noted earlier and as you see in our outlook, our first half gross margin being down 300 basis points, we were able to offset through pricing increases at that mid single digit level the effects of cost increases in our input costs. So when you think of raw materials and labor, but we werent able to at the time, we finalized prices for spring 'twenty two.

Speaker 6: We were able to offset through pricing increases at that mid-single-digit level the effects of cost increases in our input costs, so when you think of raw materials and labor, but we weren't able to at the time that we finalized prices for spring 22. We hadn't yet had visibility to the increases in these ocean freight surcharges.

We hadn't yet had visibility to the increases in these ocean freight surcharges and then as we got into the fall season, we had better visibility both of the product input cost as well that ocean freight and we've priced accordingly in order to offset those pressures for the season.

Speaker 6: And then as we got to the fall season, we had better visibility, both of the product input costs as well as that ocean freight, and we've priced accordingly in order to offset those pressures for the season.

Got it and then just if I could have one follow up on the operating margin outlook now assuming next year things get better and maybe the.

Speaker 8: got it and and then just if i could have like one follow-up on uh... operating margin outlook no assuming you know next year things get better and now maybe the

The cost environment improves could we assume that the company recovers those 160 basis points and that's implying like even though.

Speaker 8: cost environment improves, could we assume that the company recovers those 160 basis points and that's been

Operating margins in the long run being closer to 15%.

Speaker 6: There's a lot of dependencies in that equation, you know, particularly as it relates to.

There is a lot of dependencies in that equation.

Particularly as it relates to ocean freight.

Speaker 6: ocean freight and those types of costs. We've done a lot of work.

And those types of costs, we've we've done a lot of work over the course of the past few months as we look at renewing our ocean freight contracts. We expect some degree of normalization in the latter part of 'twenty, two frankly, though as we look out further into 'twenty three and beyond we do.

Speaker 6: over the course of the past few months as we look at renewing our ocean break contracts. We expect some degree of normalization.

Speaker 6: in the latter part of 22. Frankly, though, as we look out further into 23 and beyond, we do believe that certain of the product cost inflationary pressures that we've seen, that they're transitory in nature. You'd see that in the case of certain of the commodity and raw materials. Those fluctuate from time to time, and that they're at elevated levels currently.

Believe that certain of the product cost inflationary pressures that we've seen that they are transitory in nature you'd see that in the case of certain of the commodity and raw materials. Those those fluctuate from time to time and that there are elevated levels currently and is ocean freight goes down or normalized. Moreover, time, we've taken advantage.

Speaker 6: and as ocean freight goes down or normalizes more over time.

Speaker 6: We've taken advantage of the strength of our brands, the pricing power that we have, and that should.

The strength of our brands the pricing power that we have and that should.

Speaker 6: As those events occur that should put us in a stronger place from an overall gross margin and operating margin perspective.

As those events occur that should put us in a stronger place from an overall gross margin and operating margin perspective.

Thank you very much.

Yeah.

Speaker 1: Thank you. Our next question comes from the line of Paul Legelez with Citigroup. Please proceed with your question.

Thank you.

Our next question comes from the line of Paul <unk> with Citigroup. Please proceed with your question.

Speaker 1: Thanks. It's Tracy Kogan filling in for Paul. I had two questions. The first was I was wondering how your retail business trended by month and whether you saw any improvement in traffic in the tourist traffic at your factory outlet locations after the borders opened.

Thanks, It's Tracy Kogan filling in for Paul I had two questions. The first one I was wondering how your retail business trended by month and whether you saw any improvement in traffic in the tourist traffic or Darren factory outlet locations after the border Hilton.

Speaker 9: in November . And then secondly, I think you guys talked about opening some new smaller concept branded stores.

November and then secondly, I think you guys talked about opening some new smaller concept branded stores.

Speaker 9: this year after closing a few in 21 and I was wondering if you could give us a sense of the new store economics of these stores versus the existing fleet and then longer term with this new store format in mind you know what your ultimate fleet size

After closing a few in 'twenty, one and I was wondering if you could give us a sense of the new store economics of these stores north of the existing fleet and then longer term with this new store format in mind.

Ultimate fleet size might be.

Thanks.

Speaker 5: Certainly, well, as it relates to the traffic in the tourist stores, those still have not come back to pre pandemic levels. In fact, they're

Certainly well as it relates to that traffic in the.

Tourist stores, though still have not come back to pre pandemic levels in fact there.

Speaker 5: they're quite anemic. It's a real testament to the power of the brands that our DTC business contributed so mightily to the fourth quarter results. But traffic is still lagging in those markets where we typically would have international tourists present.

They are quite anemic.

It's a real testament to the power of the brands that our DTC business contributed so mightily to the fourth quarter results.

But traffic is still.

Lagging in those markets, where we typically would have international tourist present.

Speaker 5: As it relates to the new format, these are stores which we're taking the learnings from our existing cadre of branded stores.

As it relates to the new format these are stores, which.

We're taking the learnings from our existing cadre of <unk>.

Branded stores, where we've enhanced the mix the merchandise mix to include not only our premium products, but also some of our opening price point items, which had not been present in the kind of.

Speaker 5: enhanced the mix, the merchandise mix to include not only our premium products but also some of our opening price point items which had not been present in the kind of

Speaker 6: depth that they had been previously. And again, as we said, we're really a wholesale company, so we don't really release the details of the metrics that we would, that a normal retailer would. So we can talk to you about the general trends in those businesses, but we don't release all the metrics. And then Tracy, your question regarding overall trends on the quarter by month.

GAAP that they had been previously.

And again as we said, we're really a wholesale company. So we don't really released the details of the metrics that we that we would.

We've got a normal retailer so we.

We can talk to you about the general trends in those businesses, but we don't release all the all the metrics.

And then Tracy your question regarding overall trends on a quarter by month.

Speaker 6: Well, we found a B2C business across both stores and e-commerces.

Well, we saw the D to C business across both stores and E Commerce was.

Speaker 6: strong growth really across all three months. There wasn't, you know, it wasn't front-weighted per se. We saw that strong revenue all the way through the month of December .

Strong growth really across all three months there wasn't.

It wasn't the front front weighted per se we saw.

That strong revenue all the way through the month of December .

Got it thanks very much.

Speaker 1: Thank you. Our next question comes from the line of Jim Duffy with Stiefel. Please proceed with your question.

Thank you. Our next question comes from the line of Jim Duffy with Stifel. Please proceed with your question.

Speaker 2: Oh, thanks. Good afternoon. Great. Quarters. I wanted to ask about the North America business. It seems to be a couple from any weather-related influence. And that's not historically done the pattern. We're curious how you explain that. Is there meaningful change in the merchandise assortment that would explain that? Or is it really just consumer behavioral difference?

Oh, Thanks, good afternoon, Greg.

Quarter, guys I wanted to ask about the North America business. It seemed to decouple from any weather related influences and that's not historically been the pattern.

Curious, how you explain that as they're meaningful change in the merchandise assortment that would explain that or is it really just consumer behavioral differences.

Well I think there were a number of things at play and obviously there was so much.

Speaker 5: Well, I think there were a number of things at play. And obviously, there was so much.

Media coverage of the shortages that consumers were generally prepared to.

Speaker 5: coverage of the shortages that consumers were generally prepared to come earlier to the stores. And then the company's largest launch of any innovation was our OmniHeat Infinity launch, which kicked off in early October . And I think those two things converged to give us really

Come earlier to the stores and then the company's largest launch of any innovation was our omni heat infinity launch, which kicked off in early October .

I think there was those two things converge to give us really.

Speaker 3: a great environment and then you know it doesn't it doesn't hurt when

Great environment, and then it doesn't it doesn't hurt.

Speaker 5: late December and January have all these cleanup storms that

In late December and January have all these cleanup storms.

Speaker 5: just drive consumers who need the product into the stores to get it. So I think it was a terrific result, but it was at least as much about the new products that we're offering as it was almost anything else.

Just drive consumers, who need the product into the stores to get it so.

I think it was.

Terrific result, and.

But it was at least as much about the new products that we're offering as it was almost anything else.

Understood. Thank you and then I also wanted to talk about the promotional backdrop fairly benign in the fourth quarter.

Speaker 2: Understood. Thank you. And then I also wanted to talk about the promotional backdrop fairly benign in the fourth quarter. Just your thoughts in the context of the order book and, you know, views to consumer spending patterns, what the glide path might look like towards a more normalized promotional environment. Any thoughts there? Maybe you can speak to how that's contemplated in the guidance for 2022.

Just your thoughts in the context of the order book in.

Hi.

Used to consumer spending patterns, what the glide path might look like.

Towards a more normalized promotional environment.

Any thoughts there maybe you can speak to how thats contemplated in the guidance for 2022.

Speaker 5: Certainly, well, it's clearly present in the gross margin guidance we've given you, that the expectations are that.

Certainly well, it's clearly present in the gross margin guidance, we've given you.

The expectations are that.

Speaker 5: There'll be more normalized activity throughout the year.

There'll be more normalized activity.

Throughout the year.

Speaker 5: You know, we're hopeful, obviously, that we've been too cautious there. But that's what our view shows us, is that there'll be more activity there than there certainly was this year.

We are hopeful obviously that.

That we've over into cautious there, but that's what our view shows us that and there'll be more activity.

Then theyre happening there certainly was this year.

Speaker 6: Yeah, and I might add something to this as well, Jim, and that's the, as we said, here in the month of January , I mean, consumer trends, the full price selling environment we've been in has continued, so we're continuing to see good, healthy margins in the DTC space with not much in the way of promo and markdowns as would typically be the time of year where you'd see those a bit deeper. And as Tim touched on, we've planned some degree of normalization.

Yes, I might add something.

Well, Jim and Thats as we sit here in the month of January and the consumer trends the full price selling environment. We've done has continued so we're continuing to see good healthy margins in the DTC space with <unk>.

Much in the way of from all of our downloads are typically be the time of year, where you'd see those.

A bit deeper as Tim touched on we plant some degree of normalization through the balance of the year.

Speaker 6: through the balance of the year. With that said, we're not contemplating that our margins and our promotional levels go back to where they were two years ago. So we're still planning for better overall margins, but coming off of some of the peaks and highs that we've seen as strong as the full price selling environment's been over the last several months.

With that said, we're not contemplating that our margins and our promotional levels go back to where they were.

Two years ago, So we're still planning for.

Better overall margin coming off of some of the peaks and the highest that we've seen as strong as the full price selling environment has been over the last several months.

Yeah.

Great. Thank you for your thoughts.

Thanks.

Speaker 1: Our next question comes from the line of Alex Perry with Bank of America. Please proceed with your question.

Our next question comes from the line of Alex Perry with Bank of America. Please proceed with your question.

Hi, Thanks for taking my question and congrats on a really strong quarter.

Speaker 10: Hi, thanks for taking my question and congrats on a really strong quarter. Um, just first, I was just wondering, um,

Just first I was just wondering.

Speaker 10: I was just wondering if there was any way to quantify how much the supply chain disruptions limited upside in the quarter, and would you characterize that as more of a 4Q, 1Q shift? And then I think in the prepared remarks, you made a statement that

I was just wondering if there was any way to sort of quantify sort of how much the supply chain disruptions limited upside in the quarter and would you characterize that as more of a <unk> shift and then I think in the prepared remarks, you made a statement that wholesale orders for 2022 supported even stronger.

Speaker 10: Wholesale orders for 2022 supported even stronger growth versus maybe what you guided to, so

Growth versus maybe what you've guided to so it seems like maybe less some 2022 orders on the table is there a possibility to meet some of that extra demand.

Speaker 10: Seems like maybe less than 2022 orders on the table. Is there, you know, a possibility to meet some of that, you know, extra demand?

Speaker 6: Well, as it relates to the first part of that question, Alex, in terms of quantifying what Q4 could have been, that's difficult to do. You know, we were a bit light in our shipments from a wholesale standpoint relative to the outlook coming into the quarter on a global basis, though. We're talking to.

Well as it relates to the first part of that question Alex in terms of quantifying what Q4 could a business that's difficult to do we were we were a bit light in our shipments from a wholesale standpoint relative to the outlook coming into the quarter on a global basis, though we are talking to.

Speaker 6: single-digit millions of dollars a bit higher in the case of the U.S. just given pork congestion and challenges from a supply chain perspective.

Single digit millions of dollars a bit higher in the case of the U S. Just given port congestion challenges from a supply chain perspective.

Speaker 6: You know, perhaps a different way of looking at it as well as if you go back, get it back to our outlook at the midpoint of the year and where we finish.

Perhaps a different way of looking at it as well as if you go back David back to our outlook at the midpoint of the year and where we finished.

Speaker 6: You know, there's about $100 million delta between where we were in July and where we finished the year. And effectively, that's

There's about $100 million Delta between where we were in July and where we finished the year and effectively thats.

Speaker 6: A lot of the, it's not been cancellations, because we've not seen cancellations, order demand from our wholesale customers has been very high, so a lot of that's orders that have shifted out into Q1, some of those will result in cancellations, and with the favorable weather that we've had, certainly it provides some upside to us, given the environment we're operating in.

A lot of the.

Cancellations, because we've not seen cancellations order demand from our wholesale customers has been very high so a lot of that orders that have shifted out.

Two Q1, some of those cancellations and with the favorable weather that we've had.

Certainly it provides some upside to us given the environment, we're operating in.

Speaker 6: And then Alex, I missed the second part of that question.

And then Alex I missed the second part of that question.

Speaker 11: Yeah, I think maybe in Tim's prepared remarks, he said, you know, wholesale orders for 2022 support even stronger growth, which sort of implied that maybe there are some orders, you know, left on the table. Is there, was that the right way of characterizing that? Or is there, is there a possibility? Yeah, I'd characterize it, I'd characterize it.

Yes, I think.

Maybe in Tim's prepared remarks, he said.

Cell orders for 2020 to support even stronger growth, which sort of implied that maybe there are some orders left on the table.

Is there was that the right way of characterizing that or is there is there a possibility you can meet I'd characterize as bolt ons hotel demand I'd characterize it.

Speaker 11: Yeah, a little bit differently in that we're buying inventory to support that higher order book and to fulfill those orders now, given the constraints that we're seeing in the supply chain, the delays, we've softened our outlook a little bit to contemplate and we've seen some of that experience during the last several months. So we're factoring that into our guidance.

Yes characterize a little bit differently in that we're buying inventory to support that higher order book and to fulfill those orders now given the constraints that we're seeing on the supply chain. The delays, we softened our outlook a little bit to contemplate and we've seen some of that experience during the last several months. So we're factoring that.

Our guidance in terms of being able to quantify that it's really difficult to do we did provide a projection on our operating cash flow, which youll note, it's down pretty significantly year on year compare 'twenty. One 'twenty two that's my CFO commentary a lot of that is going to be reflective of.

Speaker 11: In terms of being able to quantify that, it's really difficult to do. We did provide a projection on our operating cash flow, which you'll note it's down pretty significantly year-on-year compared 21 to 22. That's my CFO commentary, and a lot of that is going to be reflective of

Speaker 11: inventory growth in contemplation of both the growth in the business and the expectation that Eventually we see some normalization of the supply chain and we've produced certain of the or some of our spring 23

Inventory growth.

Contemplation of both the growth in the business and the expectation that eventually we see some normalization of the supply chain and we've produced certain of the or some of our spring 'twenty three.

Speaker 11: production and see some of that inventory come into the year as well.

Production and see some of that inventory come into the year as well.

I think incredibly helpful. And then just a follow up question.

Speaker 10: incredibly helpful. And then just a follow-up question, how are you just thinking, you know, higher level about the health of the U.S. consumer in 2022 as you lap, you know, stimulus benefits and expanded unemployment benefits?

Or are you just thinking higher level about the health of the U S. Consumer in 2022, as you lap stimulus benefits and expanded unemployment benefits.

Speaker 5: Well, I think that there's significant pricing power within the brands that we have.

Well I think that there is significant pricing pressure pricing.

Within the brands that we have.

Speaker 5: And, you know, in periods of.

<unk>.

In periods of.

Speaker 12: economic turmoil, which if the stimulus does not continue and there are other impacts, it'll be slightly disruptive. But we've done very well in periods of tough economic times. It's really a testament to the brands, all of them, to the strength of our brands and our ability to manage in a thoughtful way based on the balance sheet we have, which we can put to use at this time.

Economic turmoil, which.

If those if the stimulus does not continue and there are other impacts.

It'll be slightly disruptive, but we've done very well in periods of of tough economic times, It's really a testament to the brands all of them to.

The strengths of our brands and our ability to manage in a thoughtful way based on the balance sheet, we have which we can put to us at this time.

Perfect. That's really helpful best of luck going forward.

Speaker 13: Thanks, Alex. Thank you.

Thank you.

Speaker 1: Our next question comes from the line of Camilla Lyon with BTIG. Please proceed with your question.

Our next question comes from the line of Camilo Lyon with BTG. Please proceed with your question.

Speaker 14: Thank you. This is Mackenzie Boydstin on for Camilo. My first question is about China. So you posted low 20 percent growth this quarter, definitely impressive given some of the macro challenges there. But we'd just love to hear you talk about your strategy, how you're kind of thinking about China going into this year.

Thank you this is mckenzie pet scan on per kilo.

First question is about China.

Posted low 20% growth this quarter definitely impressive given some of the macro challenges there, but would just love to hear you talk about your strategy.

How are you just kind of thinking about China going into this year.

Yes.

Speaker 15: You have to know we've been very open about the fact that we've under-formed in China, a huge market, even clear, completely so large.

Yeah.

Alright.

Okay.

Okay.

In China.

Mark.

Yeah.

So.

Okay.

Speaker 15: geographic area for the company in terms of opportunity. It's great to see a turnaround in that market. We think we have the beginnings of a great growth there.

Yes.

Area for the company in terms of opportunity.

It's great to see a turnaround in that market.

We think we're at the beginning.

Great growth there.

Speaker 5: We have a new management team in place, as I think we've told you, and we have a high degree of confidence that we've got the right approach there to get ourselves in a better position. The Columbia brand, which is really the only one that we have in that market, is very strong. It's been there for a long time, and it's now, as our team in China likes to say, it's reawakening the brand.

A new management team in place as I think we've told you.

We have a high degree of confidence that we've got the right approach there to get to get ourselves in a better position.

Various the Columbia brand, which is really the only one that we have in that market is very strong it's been there for a long time and it's now.

Yes.

Team in China likes to say, it's reawakening the brand.

Speaker 5: So we would expect that you'll see continued strong growth there, especially based on the investments we've made in.

So we would expect that you'll see continued strong growth there, especially based on the investments we've made in.

Speaker 15: in the digital arena, both in people and processes.

Yeah.

In the digital arena, both in people and processes.

Thank you.

Speaker 14: Great, thank you. And then my second question is just about footwear. So I know you mentioned in your prepared remarks about not being able to fully meet the demand for footwear this year. Could you just talk about the state of your manufacturing operations and footwear today? And when would you expect to see that start to normalize?

And then my second question is just about.

Larry you mentioned in your prepared remarks.

Being able to fully meet the demand for footwear. This year could you just talk about the state of your manufacturing operation and footwear today and then when would you expect to see that check normalize.

Speaker 15: Certainly. Well, you know, I personally have been talking about the promise of footwear since we went public in 1998, and we're now beginning to see just how important that can be. With both the Columbia product and the Sorrel product, just the demand is literally outstripping our ability to supply it. So we will have growth in

Certainly well.

I personally have been talking about the promise of footwear. Since we went public in 1998, and we're now beginning to see just how important that can't be with both Columbia product and the Sorel product.

Just the demand is literally outstripping our ability to supply.

So we will have growth in footwear.

Speaker 15: obviously in revenue and in supply in 22.

Obviously in revenue and in supply in 'twenty two.

Speaker 15: which is going to be quite higher than it was in 21. But it's still not enough to cover all the demand that we see out there for the product. And that demand is really.

Which is going to be quite higher than it was in 'twenty, one, but it's still not enough to cover all the demand that we see out there for <unk>.

The product and that demand is really.

Speaker 15: uh, quite strong in every market that we operate. So we believe that we are in.

Quite strong in every market that we operate so.

So we believe that we are in.

Speaker 12: in a position where we will be able to cover that, the full demand for the company's footwear products in 23. But it's taken us some time to get ourselves in that position.

In a position, where we will be able to cover that the full demand for the companys footwear products in 'twenty three.

But it has taken us some time to get ourselves in that position.

Okay. Thank you best of luck.

Thanks.

Speaker 1: Ladies and gentlemen, we have reached the end of the question and answer session. I will now send a call over to Tim Boyle for closing remarks.

Ladies and gentlemen, we have reached the end of our question and answer session. I will now turn the call over to Tim Boyle for closing remarks.

Speaker 3: Well, thank you very much for listening in. We're really proud of the way our employees and the teams concluded this year. If you would have told us at the beginning of the year that we'd be in this position, we would likely not have believed you. But we really want to make sure that you understand.

Well. Thank you very much for listening in we're really proud of the way our employees. The teams concluded. This year. It was if you would've told us at the beginning of the year.

Be in this position.

Would likely not have believed you, but we really want to make sure that you understand as much as possible about the business and importantly, the products that we make across all of our brands. So we're looking forward to welcoming you here in September to show you the full breadth of our product offering and the products that we make thank.

Speaker 3: as much as possible about the business and, importantly, the products that we make across all of our brands. So, we're looking forward to welcoming you here in September to show you the full breadth of our product offering and the products that we make. So, thank you.

Thank you very much.

Speaker 1: This concludes today's conference and you may disconnect your lines at this time. Thank you for your participation and have a wonderful day.

This concludes today's conference and you may disconnect your lines at this time.

You for your participation and have a wonderful day.