8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

April 28, 2016

COLUMBIA SPORTSWEAR COMPANY

(Exact name of registrant as specified in its charter)

Oregon	000-23939	93-0498284
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

14375 Northwest Science Park Drive

Portland, Oregon 97229

(Address of principal executive offices) (Zip code)

(503) 985-4000

(Registrant’s telephone number, including area code)

No Change

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION

On April 28, 2016, Columbia Sportswear Company (the “Company”) issued a press release reporting its first quarter 2016 financial results and updated outlook for 2016. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. The information in this report shall not be treated as filed for purposes of the Securities Exchange Act of 1934, as amended.

Attached hereto as Exhibit 99.2 and incorporated by reference herein is financial information and commentary by Thomas B. Cusick, Executive Vice President of Finance and Chief Financial Officer of Columbia Sportswear Company, for the first quarter of 2016 and forward-looking statements relating to the financial outlook for fiscal year 2016, as posted on the Company’s investor relations website, http://investor.columbia.com, on April 28, 2016. The information in this report shall not be treated as filed for purposes of the Securities Exchange Act of 1934, as amended.

ITEM 7.01 REGULATION FD DISCLOSURE

In its April 28, 2016 press release, the Company also announced that its Board of Directors approved a cash dividend of $0.17 per share of common stock to be paid on June 2, 2016 to its shareholders of record on May 19, 2016.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(d) Exhibits

99.1	Press Release, dated April 28, 2016 (furnished pursuant to Items 2.02 and 7.01 hereof).
99.2	Commentary by Thomas B. Cusick, Executive Vice President of Finance and Chief Financial Officer of Columbia Sportswear Company, dated April 28, 2016 (furnished pursuant to Items 2.02 and 7.01 hereof).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	COLUMBIA SPORTSWEAR COMPANY
Dated: April 28, 2016	By:	/S/ THOMAS B. CUSICK
		Thomas B. Cusick
		Executive Vice President of Finance and Chief Financial Officer

EXHIBIT INDEX

Exhibit	Description
99.1	Press Release, dated April 28, 2016 (furnished pursuant to Items 2.02 and 7.01 hereof).
99.2	Commentary by Thomas B. Cusick, Executive Vice President of Finance and Chief Financial Officer of Columbia Sportswear Company, dated April 28, 2016 (furnished pursuant to Items 2.02 and 7.01 hereof).

EX-99.1

Exhibit 99.1

Contact:

Ron Parham

Sr. Director of Investor Relations

& Corporate Communications

Columbia Sportswear Company

(503) 985-4584

rparham@columbia.com

COLUMBIA SPORTSWEAR COMPANY REPORTS RECORD FIRST QUARTER;

NET INCOME INCREASES 20 PERCENT ON 10 PERCENT NET SALES GROWTH

First Quarter 2016 Highlights:

• Net sales increased 10 percent (12 percent constant-currency) to a first-quarter record $525.1 million.

• Operating income hit a first-quarter record of $44.3 million, or 8.4 percent of net sales.

• Net income increased 20 percent to a first-quarter record $31.8 million, or $0.45 per diluted share, aided by a tax benefit of $4.1 million, or $0.06 per diluted share, from the adoption of a newly issued accounting standard.

• The board of directors approved a regular quarterly dividend of $0.17 per share, payable on June 2, 2016 to shareholders of record on May 19, 2016.

Fiscal Year 2016 Outlook Highlights:

• Mid-single-digit percentage net sales growth, including less than 1 percentage point negative effect from changes in currency exchange rates.

• Mid-single-digit percentage increase in operating income to between $254 million and $263 million, representing operating margin of up to 10.7 percent of net sales.

• An estimated full year tax rate of approximately 25.0 percent.

• High single-digit percentage increase in net income to between $184 million and $191 million, or approximately $2.60 to $2.70 per diluted share, on approximately 70.8 million diluted shares outstanding.

PORTLAND, Ore. - April 28, 2016 - Columbia Sportswear Company (NASDAQ: COLM) today announced record first quarter net sales of $525.1 million for the quarter ended March 31, 2016, a 10 percent increase (12 percent constant-currency) compared with net sales of $479.0 million for the first quarter of 2015. First quarter 2016 operating income increased to a first quarter record $44.3 million, or 8.4 percent of net sales. First quarter 2016 net income increased 20 percent to $31.8 million, or $0.45 per diluted share, also a first quarter record, aided by a tax benefit of $4.1 million, or $0.06 per diluted share, related to the company's adoption of a newly issued accounting standard. First quarter 2015 net income totaled $26.5 million, or $0.37 per diluted share.

Chief Executive Officer Tim Boyle commented, “Our diverse brand portfolio drove strong growth during the first quarter, including high-20 percent growth in our U.S. direct-to-consumer channels and low-teen percentage growth in our U.S. wholesale channel. The Columbia, SOREL, prAna and Mountain Hardwear brands each generated double-digit percentage constant-currency net sales growth in North America. We're also extremely encouraged by our continued progress in our Europe-direct markets, where the Columbia brand drove high 20 percent constant-currency growth.

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“We remain committed to strengthening our brands through innovation, design, brand-enhancing distribution, elevated in-store presentation, and increased demand creation investments. These commitments are increasingly important as our North American wholesale customers continue to adapt to a challenging retail environment, while other markets experience continuing currency and macro-economic challenges.”

Boyle concluded, “Our strong balance sheet gives us the financial flexibility to continue to make carefully-considered long-term strategic investments to position the company to drive profitability.”

First Quarter Results

(All comparisons are between first quarter 2016 and first quarter 2015, unless otherwise noted.)

First quarter consolidated net sales growth of 10 percent (12 percent constant-currency) was driven by:

• U.S. net sales growth of 18 percent to $336.2 million, consisting of low-teen percentage growth in wholesale channels and high 20-percent growth in the company's direct-to-consumer channels;

• a 7 percent net sales increase (14 percent constant-currency) in the Europe, Middle East and Africa (EMEA) region to $51.3 million, including high-teen percentage growth (high 20 percent constant-currency) in the company’s Europe-direct business. That growth was partially offset by a high 20 percent decline in net sales to EMEA distributors; and

• a 4 percent net sales increase (18 percent in constant-currency) in Canada.

This growth was partially offset by:

• a 10 percent net sales decline (7 percent constant-currency) in the Latin America, Asia Pacific (LAAP) region to $101.8 million, including declines of more than 30 percent in net sales in Korea and to LAAP distributors, partially offset by low-single-digit percentage growth in China and Japan.

(See “Geographical Net Sales” table below.)

Global Columbia brand net sales increased 9 percent (11 percent constant-currency) to $437.1 million compared with the first quarter of 2015. Global SOREL brand net sales increased 35 percent (38 percent constant-currency) to $18.1 million. Global prAna brand net sales increased 12 percent to $41.4 million, and global Mountain Hardwear brand net sales of $25.2 million were essentially flat compared to the first quarter of 2015 . (See “Brand Net Sales” table below.)

Global Apparel, Accessories & Equipment net sales increased 9 percent (11 percent constant-currency) to $434.0 million and Footwear net sales increased 14 percent (18 percent constant-currency) to $91.1 million. (See “Categorical Net Sales” table below.)

First quarter income from operations totaled $44.3 million, or 8.4 percent of net sales, compared to $44.1 million, or 9.2 percent of net sales, for the same period in 2015.

The effective income tax rate was 22.5 percent in the first quarter of 2016, compared to 33.6 percent for the same period in 2015. The lower effective tax rate primarily reflected a tax benefit of $4.1 million, or $0.06 per diluted share, for excess tax benefits from share-based payment awards recorded in income tax expense related to the company's adoption during the quarter of Accounting Standards Update (ASU) 2016-09, Improvements to Employee Share-Based Payment Accounting.The effective tax rate also decreased due to the expected geographic mix of projected full year 2016 pre-tax income.

First quarter net income increased 20 percent to $31.8 million, or $0.45 per diluted share, compared with first quarter 2015 net income of $26.5 million, or $0.37 per diluted share.

Balance Sheet and Cash Flow

The company generated $97.0 million in operating cash flow in the quarter, and finished the quarter with $451.2 million of cash and short-term investments, compared with $454.5 million at March 31, 2015.

Consolidated inventories of $412.2 million at March 31, 2016 were 13 percent higher than the $363.7 million balance at March 31, 2015, consisting primarily of current Spring 2016 and Fall 2015 styles.

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Dividend

The board of directors authorized a regular quarterly dividend of $0.17 per share, payable on June 2, 2016 to shareholders of record on May 19, 2016.

2016 Financial Outlook

All projections related to anticipated future results are forward-looking in nature and are subject to risks and uncertainties which may cause actual results to differ, perhaps materially. A more detailed version of the company’s first quarter 2016 financial results and 2016 outlook can be found in the “CFO Commentary on First Quarter 2016 Financial Results and 2016 Financial Outlook”, available on the company’s investor relations website: http://investor.columbia.com/results.cfm.

The company currently expects mid-single-digit percentage 2016 net sales growth, including approximately 1 percentage point negative effect from changes in foreign currency exchange rates, on a base of 2015 net sales of $2.33 billion.

The company expects fiscal year 2016 gross margins to improve by up to 30 basis points, and for selling, general and administrative expenses to increase at a rate slightly faster than net sales, resulting in approximately 40 basis points of SG&A expense deleverage. In addition, the company now expects a full year tax rate of approximately 25 percent, compared with a previous estimate of 27.5 percent.

Based on the above assumptions, the company expects operating income to increase up to 6 percent, to between $254 million and $263 million, resulting in anticipated 2016 operating margin of up to 10.7 percent. Net income after non-controlling interest is expected to increase approximately 9 percent, to between approximately $184 million and $191 million, or approximately $2.60 to $2.70 per diluted share, up to 10 percent higher than 2015 EPS of $2.45. Included in the above 2016 EPS outlook is an unfavorable impact of approximately $(0.27) resulting from the strengthening of the U.S. dollar, in addition to an estimated unfavorable impact of $(0.10) per share in 2015. This currency impact primarily comprises lower gross margins within many of our foreign subsidiaries as a result of increased local currency costs of inventory purchased in U.S. dollars.

The company’s annual net sales are weighted more heavily toward the fall/winter season, while operating expenses are more equally distributed throughout the year, resulting in a highly seasonal profitability pattern weighted toward the second half of the fiscal year.

CFO’s Commentary on First Quarter 2016 Results and 2016 Outlook Available Online

At approximately 4:15 p.m. ET today, a commentary by Tom Cusick, executive vice president of finance and chief financial officer, reviewing the company’s first quarter 2016 financial results and 2016 outlook will be furnished to the SEC on Form 8-K and published on the company’s website at http://investor.columbia.com/results.cfm. Analysts and investors are encouraged to review this commentary prior to participating in the conference call.

Conference Call

The company will host a conference call on Thursday, April 28, 2016 at 5:00 p.m. ET to review its first quarter financial results and 2016 outlook. Dial 877-407-9205 to participate. The call will also be webcast live on the Investor Relations section of the company’s website at http://investor.columbia.com where it will remain available until approximately April 26, 2017.

Second Quarter 2016 Reporting Schedule

Columbia Sportswear plans to report financial results for second quarter 2016 on Thursday, July 28, 2016 at approximately 4:00 p.m. ET. Following issuance of the earnings release, a commentary reviewing the company’s second quarter financial results and 2016 outlook will be furnished to the SEC on Form 8-K and published on the investor relations section of the company’s website at http://investor.columbia.com/results.cfm. A public webcast of Columbia’s earnings conference call will follow at 5:00 p.m. ET at www.columbia.com.

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Supplemental Constant-Currency Financial Information

The company reports its financial information in accordance with accounting principles generally accepted in the United States (“GAAP”). During periods of significant foreign currency exchange rate volatility, to supplement financial information reported in accordance with GAAP, the company discloses constant-currency net sales information, which is a non-GAAP financial measure, to provide a framework to assess how the business performed excluding the effects of changes in the exchange rates used to translate net sales generated in foreign currencies into U.S. dollars. The company calculates constant-currency net sales by translating net sales in foreign currencies for the current period into U.S. dollars at the exchange rates that were in effect during the comparable period of the prior year. Management believes that this non-GAAP financial measure reflects an additional and useful way of viewing an aspect of our operations that, when viewed in conjunction with our GAAP results, provides a more comprehensive understanding of our business and operations. In particular, investors may find the non-GAAP measures useful by reviewing our net sales results without the significant volatility in foreign currency exchange rates.  This non-GAAP financial measure also facilitates management’s internal comparisons to our historical net sales results and comparisons to competitors’ net sales results. Constant-currency financial measures should be viewed in addition to, and not in lieu of or superior to, our financial measures calculated in accordance with GAAP. The company provides a reconciliation of this non-GAAP measure to the most directly comparable financial measure calculated in accordance with GAAP. (See “Supplemental Financial Information - Constant-currency Basis” tables below.) The constant-currency information presented may not be comparable to similarly titled measures reported by other companies.

About Columbia Sportswear Company

Columbia Sportswear Company has assembled a portfolio of brands for active lives, making it a leader in the global active lifestyle apparel, footwear, accessories and equipment industry. Founded in 1938 in Portland, Oregon, the company’s brands are today sold in approximately 100 countries. In addition to the Columbia® brand, Columbia Sportswear Company also owns the Mountain Hardwear®, SOREL®, prAna®, Montrail®, and OutDry® brands. To learn more, please visit the company's websites at www.columbia.com, www.mountainhardwear.com, www.sorel.com, www.prana.com, www.montrail.com, and www.outdry.com.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the federal securities laws, including statements regarding anticipated results, net sales and net sales growth, gross margins, operating expenses, operating income, operating margins, earnings per share, inventory costs, the effects of changes in foreign currency exchange rates, net losses and net income. Forward-looking statements often use words such as “will,” “anticipate,” “estimate,” “expect,” “should” and “may” and other words and terms of similar meaning or reference future dates. The company’s expectations, beliefs and projections are expressed in good faith and are believed to have a reasonable basis; however, each forward-looking statement involves a number of risks and uncertainties, including those set forth in this document, those described in the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q under the heading “Risk Factors,” and those that have been or may be described in other reports filed by the company, including reports on Form 8-K. Potential risks and uncertainties that may affect our future revenues, earnings and performance and could cause the actual results of operations or financial condition of the company to differ materially from the anticipated results expressed or implied by forward-looking statements in this document include: loss of key customer accounts; our ability to effectively implement IT infrastructure and business process initiatives; the effects of unseasonable weather, including global climate change; trends affecting consumer traffic and spending in brick and mortar retail channels; our ability to implement our growth strategy; unfavorable economic conditions generally, the financial health of our customers and changes in the level of consumer spending and apparel preferences; changes in international, federal or state tax, labor and other laws and regulations that affect our business, including changes in corporate tax rates or increasing wage rates; volatility in global production and transportation costs and capacity; risks inherent in doing business in foreign markets, including fluctuations in currency exchange rates; our ability to attract and retain key personnel; risks associated with our joint venture; higher than expected rates of order cancellations; increased consolidation of our wholesale customers; our ability to effectively source and deliver our products to customers in a timely manner; our dependence on independent manufacturers and suppliers and our ability to source finished products and components at competitive prices from them; the effectiveness of our sales and marketing efforts; intense competition in the industry; business disruptions and acts of terrorism, cyber-attacks or military activities around the globe; and our ability to establish and protect our intellectual property. The company cautions that forward-looking

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statements are inherently less reliable than historical information. The company does not undertake any duty to update any of the forward-looking statements after the date of this document to conform them to actual results or to reflect changes in events, circumstances or its expectations. New factors emerge from time to time and it is not possible for the company to predict or assess the impact of all such factors or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

- Financial tables follow -

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COLUMBIA SPORTSWEAR COMPANY

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)

	March 31,
	2016		2015
Current Assets:
Cash and cash equivalents	$	430,000	$	401,604
Short-term investments	21,227		52,938
Accounts receivable, net	268,871		251,702
Inventories	412,228		363,656
Deferred income taxes	—		54,708
Prepaid expenses and other current assets	30,116		47,502
Total current assets	1,162,442		1,172,110
Property, plant, and equipment, net	289,663		283,091
Intangibles and other non-current assets	308,657		233,872
Total assets	$	1,760,762	$	1,689,073
Current Liabilities:
Accounts payable	$	113,013	$	144,488
Accrued liabilities	121,066		97,948
Income taxes payable	4,911		6,889
Deferred income taxes	—		121
Total current liabilities	238,990		249,446
Note payable to related party	15,123		15,743
Other long-term liabilities	52,734		49,449
Equity:
Columbia Sportswear Company shareholders' equity	1,435,285		1,361,329
Non-controlling interest	18,630		13,106
Total equity	1,453,915		1,374,435
Total liabilities and equity	$	1,760,762	$	1,689,073

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COLUMBIA SPORTSWEAR COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

	Three Months Ended March 31,
	2016			2015
Net sales	$	525,136		$	478,982
Cost of sales	277,759			250,208
Gross profit	247,377			228,774
	47.1		%	47.8		%
Selling, general and administrative expenses	205,025			186,502
Net licensing income	1,913			1,850
Income from operations	44,265			44,122
Interest income, net	491			377
Interest expense on note payable to related party	(264		)	(274		)
Other non-operating expense	(375		)	(2,196		)
Income before income tax	44,117			42,029
Income tax expense	(9,923		)	(14,110		)
Net income	34,194			27,919
Net income attributable to non-controlling interest	2,424			1,448
Net income attributable to Columbia Sportswear Company	$	31,770		$	26,471
Earnings per share attributable to Columbia Sportswear Company:
Basic	$	0.46		$	0.38
Diluted	0.45			0.37
Weighted average shares outstanding:
Basic	69,441			70,080
Diluted	70,455			71,010

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COLUMBIA SPORTSWEAR COMPANY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Three Months Ended March 31,
	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	34,194		$	27,919
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	14,682			13,936
Loss on disposal or impairment of property, plant, and equipment	159			395
Deferred income taxes	1,323			7,319
Stock-based compensation	3,073			2,946
Excess tax benefit from employee stock plans	—			(5,213		)
Changes in operating assets and liabilities:
Accounts receivable	108,668			85,527
Inventories	68,511			14,680
Prepaid expenses and other current assets	3,642			(8,929		)
Other assets	(2,426		)	(807		)
Accounts payable	(104,419		)	(62,251		)
Accrued liabilities	(33,476		)	(38,933		)
Income taxes payable	1,453			(8,675		)
Other liabilities	1,612			793
Net cash provided by operating activities	96,996			28,707
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of short-term investments	(20,781		)	(27,556		)
Sales of short-term investments	—			1,760
Capital expenditures	(10,048		)	(15,467		)
Proceeds from sale of property, plant, and equipment	24			69
Net cash used in investing activities	(30,805		)	(41,194		)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from credit facilities	2,691			60
Repayments on credit facilities	(4,631		)	(60		)
Proceeds from issuance of common stock under employee stock plans	7,417			11,101
Tax payments related to restricted stock unit issuances	(4,756		)	(4,440		)
Excess tax benefit from employee stock plans	—			5,213
Cash dividends paid	(11,841		)	(10,557		)
Net cash provided by (used in) financing activities	(11,120		)	1,317
NET EFFECT OF EXCHANGE RATE CHANGES ON CASH	5,159			(784		)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	60,230			(11,954		)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	369,770			413,558
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	430,000		$	401,604
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING ACTIVITIES:
Capital expenditures incurred but not yet paid	$	2,582		$	2,742

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COLUMBIA SPORTSWEAR COMPANY

Supplemental Financial Information

Net Sales Growth - Constant-currency Basis

(In millions, except percentage changes)

(Unaudited)

	Three Months Ended March 31,
			Adjust for		Constant-					Constant-
	Reported		Foreign		currency		Reported		Reported	currency
	Net Sales		Currency		Net Sales		Net Sales		Net Sales	Net Sales
	2016		Translation		2016(1)		2015		% Change	% Change(1)
Geographical Net Sales:
United States	$	336.2	$	—	$	336.2	$	283.8	18%	18%
LAAP	101.8		3.4		105.2		113.1		(10)%	(7)%
EMEA	51.3		3.2		54.5		47.8		7%	14%
Canada	35.8		4.6		40.4		34.3		4%	18%
Total	$	525.1	$	11.2	$	536.3	$	479.0	10%	12%
Brand Net Sales:
Columbia	$	437.1	$	9.9	$	447.0	$	401.0	9%	11%
Sorel	18.1		0.4		18.5		13.4		35%	38%
prAna	41.4		—		41.4		37.1		12%	12%
Mountain Hardwear	25.2		0.8		26.0		25.1		—%	4%
Other	3.3		0.1		3.4		2.4		38%	42%
Total	$	525.1	$	11.2	$	536.3	$	479.0	10%	12%
Categorical Net Sales:
Apparel, Accessories and Equipment	$	434.0	$	8.3	$	442.3	$	399.3	9%	11%
Footwear	91.1		2.9		94.0		79.7		14%	18%
Total	$	525.1	$	11.2	$	536.3	$	479.0	10%	12%

⁽¹⁾ Constant-currency net sales information is a non-GAAP financial measure, which excludes the effect of changes in foreign currency exchange rates against the U.S. dollar between comparable reporting periods. The Company calculates constant-currency net sales by translating net sales in foreign currencies for the current period into U.S. dollars at the exchange rates that were in effect during the comparable period of the prior year.

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EX-99.2

Exhibit 99.2

14375 NW Science Park Drive

Portland, OR 97229

April 28, 2016

CFO Commentary on First Quarter 2016 Financial Results

and Updated 2016 Financial Outlook

Financial Information

Please reference accompanying financial information in the corresponding earnings release at

http://investor.columbia.com/results.cfm

Conference Call

The company will host a conference call on Thursday, April 28, 2016 at 5:00 p.m. ET to review first quarter results, as well as its updated 2016 financial outlook. To participate, please dial (877) 407-9205 in the U.S. The call will be webcast live on the Investor Relations section of the company’s website http://investor.columbia.com where it will remain available until April 26, 2017.

First Quarter Summary

Net sales increased $46.1 million, or 10 percent (12 percent constant-currency), to a first-quarter record $525.1 million, compared with net sales of $479.0 million for the first quarter of 2015.

Gross margin contracted approximately 70 basis points to 47.1 percent of net sales. Selling, general & administrative (SG&A) expenses increased $18.5 million, or 10 percent, resulting in approximately 10 basis points of operating expense deleverage.

Record first-quarter operating income of $44.3 million represented 8.4 percent of net sales, compared with first quarter 2015 operating income of $44.1 million, or 9.2 percent of net sales.

The effective income tax rate was 22.5 percent in the first quarter of 2016, compared to 33.6 percent for the same period in 2015, aided by a tax benefit of $4.1 million, or $0.06 per diluted share, from the adoption of a newly issued accounting standard.

Net income increased $5.3 million, or 20 percent, to a first-quarter record $31.8 million, or $0.45 per diluted share, compared to first quarter 2015 net income of $26.5 million, or $0.37 per diluted share.

FY2016Financial Outlook Summary

Our full year 2016 financial outlook anticipates:

• Mid-single-digit percentage net sales increase compared with 2015 net sales of $2.33 billion, including less than 1 percentage point negative effect from changes in currency exchange rates;

• Mid-single-digit percentage increase in operating income to between $254 million and $263 million, representing operating margin of up to 10.7 percent;

• An estimated full year tax rate of approximately 25.0 percent; and

• High-single-digit percentage increase in net income to between approximately $184 million and $191 million, or $2.60 to $2.70 per diluted share, on approximately 70.8 million diluted shares outstanding. First half net income is expected to be comparable to first half 2015, with full year profitability growth concentrated in the second half.

The Full Year 2016 Financial Outlook section beginning on page 4 below contains a more detailed discussion of the factors contributing to this outlook.

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First Quarter Financial Results

(All comparisons are between first quarter 2016 and first quarter 2015, unless otherwise noted.)

Net Sales

Consolidated net sales increased $46.1 million, or 10 percent (12 percent constant-currency), to a first-quarter record $525.1 million, compared with $479.0 million.

Regions

• U.S. net sales increased $52.4 million, or 18 percent, to $336.2 million. The increase in U.S. net sales reflected increased direct-to-consumer (DTC) sales and shipments of increased Spring 2016 advance orders to wholesale customers. During the first quarter of 2016, the company operated 110 U.S. retail stores and 5 branded ecommerce sites, compared with 95 stores and 5 branded ecommerce sites in Q1 2015.

• Net sales in the Latin America and Asia Pacific (LAAP) region declined $11.3 million, or 10 percent, (7 percent constant-currency) to $101.8 million, primarily reflecting a low-thirty percent net sales decline in Korea (mid-20 percent constant-currency) due to the extremely competitive nature of the outdoor sector in that country, and a mid-thirty percent decline in sales to LAAP distributors reflecting shifts in the timing of shipments of reduced Spring 2016 advance orders. These declines were partially offset by a low single-digit percentage net sales increase in Japan (low-single-digit percentage constant-currency), and a low single-digit net sales increase in China (high-single-digit percentage constant-currency).

• Net sales in the Europe, Middle East, and Africa (EMEA) region increased $3.5 million, or 7 percent, (14 percent constant-currency) to $51.3 million. EMEA-direct net sales reflected a high-teen percentage increase (high 20 percent constant-currency), reflecting increased advance orders from European wholesale customers. This growth was partially offset by a high 20 percent decline in net sales to EMEA distributors, primarily reflecting lower net sales to the company’s Russian distributor as it continues to adapt its business to macroeconomic challenges in that region.

• Net sales in Canada increased $1.5 million, or 4 percent (18 percent constant-currency) to $35.8 million, reflecting higher DTC net sales and flat wholesale net sales.

Brands

• Columbia global brand net sales increased $36.1 million, or 9 percent (11 percent constant-currency), to $437.1 million, primarily reflecting increased net sales in the U.S., EMEA-direct markets, Canada, and China, partially offset by lower net sales to LAAP and EMEA distributors, and lower net sales in Korea.

• SOREL global brand net sales increased $4.7 million, or 35 percent (38 percent constant-currency), to $18.1 million, driven primarily by increased net sales in the U.S.

• prAna global brand net sales increased $4.3 million, or 12 percent, to $41.4 million, primarily reflecting growth in the U.S.

• Mountain Hardwear global brand net sales of $25.2 million were essentially unchanged.

Product Categories

• Global Apparel, Accessories & Equipment net sales increased $34.7 million, or 9 percent (11 percent constant-currency), to $434.0 million, primarily driven by increased Columbia brand net sales in the U.S. and Europe-direct markets, as well as increased prAna brand net sales in the U.S., partially offset by sales declines in Korea and lower sales to LAAP distributors.

• Global Footwear net sales increased $11.4 million, or 14 percent (18 percent constant-currency), to $91.1 million, driven by growth from the Columbia brand in the U.S. and Europe-direct markets, and growth from the SOREL brand in the U.S.

Gross Margin

Gross margins contracted70 basis points to 47.1 percent of net sales, primarily reflecting:

• unfavorable foreign currency hedge rates in Europe, Canada, and Japan; and

• higher inventory provisions in Korea;

partially offset by:

• favorable changes in sales channel mix with a higher proportion of direct-to-consumer sales, which carry higher gross margins and a lower proportion of international distributor sales which carry lower gross margins; and

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• a lower volume of close-out product sales at higher gross margins compared to last year.

Selling, General and Administrative (SG&A) Expense

SG&A expense increased$18.5 million, or 10 percent, to $205.0 million, or 39.0 percent of net sales, compared to 38.9 percent of net sales in last year’s first quarter, resulting in approximately 10 basis points of operating expense deleverage. The increased SG&A expense included:

• expenses related to the company’s expanding global DTC operations,

• personnel costs to support strategic initiatives and business growth, and

• information technology investments;

partially offset by:

• favorable foreign currency translation effects.

Non-Operating Expense

Non-operating expense decreased $1.8 million, due to lower net losses on the revaluation of foreign currency denominated assets and liabilities and lower net losses attributed to the settlement of foreign-currency denominated inter-company transactions.

Operating Income

Operating income increased to a first-quarter record $44.3 million, or 8.4 percent of net sales, compared with first quarter 2015 operating income of $44.1 million, or 9.2 percent of net sales.

Income Tax Expense

The effective tax rate for the first quarter was 22.5 percent, compared to a 33.6 percent rate in the first quarter of 2015. The lower effective tax rate primarily resulted from a tax benefit of $4.1 million, or $0.06 per diluted share, for excess tax benefits from share-based payment awards recorded in income tax expense related to the company's adoption during the quarter of Accounting Standards Update (ASU) 2016-09, Improvements to Employee Share-Based Payment Accounting. The effective tax rate also decreased due to the expected geographic mix of projected full year 2016 pre-tax income.

Net Income

Net income increased 20 percent to a first-quarter record $31.8 million, or $0.45 per diluted share, compared with net income of $26.5 million, or $0.37 per diluted share, in the first quarter of 2015.

Regular Quarterly Cash Dividend

At its regular board meeting on April 22, 2016, the board of directors authorized a regular quarterly cash dividend of $0.17 per share, payable on June 2, 2016 to shareholders of record on May 19, 2016.

Balance Sheet

At March 31, 2016, cash and short-term investments totaled $451.2 million, compared to $454.5 million at March 31, 2015. At March 31, 2016, approximately 57 percent of cash and short-term investments were held in foreign jurisdictions where a repatriation of those funds to the United States would likely result in a significant tax cost to the company.

Consolidated accounts receivable at March 31, 2016 totaled $268.9 million, a 7 percent increase on 10 percent first quarter net sales growth. Consolidated Days Sales Outstanding (DSO) at March 31, 2016 stood at 46 days, a decrease of 1 day compared with March 31, 2015.

Consolidated inventory of $412.2 million at March 31, 2016 increased $48.6 million, or 13 percent, compared to March 31, 2015. The increased inventory is concentrated in North America and primarily reflects more timely production and receipt of Spring 2016 styles, with the remainder primarily comprising Fall 2015 styles. We expect inventory growth to normalize with sales growth in the second half of the year as we clear excess Fall 2015 inventory.

Cash Flow

Net cash provided by operations in the first quarter of 2016 was $97.0 million, compared to $28.7 million in the first quarter of 2015.

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Capital expenditures totaled $10.0 million, compared to $15.5 million in the first quarter of 2015.

The company paid quarterly cash dividends of $11.8 million during the first quarter of 2016 and made no repurchases of common stock. Approximately $173.5 million remains available under the current repurchase authorization, which does not obligate the company to acquire any specific number of shares or to acquire shares over any specified period of time.

Full Year 2016 Financial Outlook

Our objective in providing a forward-looking financial outlook is to help investors understand our business and the variables that we consider when planning our business and evaluating our own performance.

All projections related to anticipated future results are forward-looking in nature and may change, perhaps significantly. Our annual net sales are weighted more heavily toward the Fall/Winter season, while operating expenses are more equally distributed throughout the year, resulting in a highly seasonal net sales and profitability pattern weighted toward the second half of the fiscal year.

Spring and Fall season advance wholesale orders typically drive a significant portion of our annual net sales and are one of several significant factors we use to formulate our full year outlook. However, among many risks inherent in our global business, our projected full year net sales and profitability may be materially affected by unfavorable weather patterns and other factors that affect consumer demand and store traffic and lead to higher-than-anticipated order cancellations and lower reorders by our wholesale customers and/or lower-than-projected net sales through our DTC channels, particularly during the fourth quarter. In addition, recent bankruptcy announcements among U.S. wholesale customers have created increased uncertainty in our ability to predict near-term net sales and profitability.

We are facing macroeconomic, competitive and/or geopolitical uncertainty in certain markets, most notably in Russia, Korea, China and several emerging markets, making it more difficult to forecast our net sales and profitability in those markets. In addition, since 2014, the U.S. dollar has strengthened significantly against the Russian ruble, Canadian dollar, Japanese yen, European euro, and the currencies of several emerging markets, which will have an unfavorable impact on sales and gross margins in these regions in 2016.

We are continuing to invest in our multi-year global ERP initiative. During the quarter, following a thorough readiness assessment of our Japan subsidiary and China joint venture operations, we elected to defer the Japan implementation that had previously been contemplated for the second half of 2016 and accelerate the ERP implementation in China to take place in 2017, as we migrate off of our joint venture partner's ERP system. We expect this change to result in a slightly lower amount of capital spend and operational cost related to the ERP implementation initiative in 2016.

Taking the above factors into consideration, and assuming macro and market conditions in key markets do not worsen, our current fiscal year 2016 outlook assumes:

• mid-single-digit percent growth in global net sales compared to 2015, with a higher growth rate in the first half of the year than in the second half, and less than 1 percentage point negative effect from changes in foreign currency exchange rates;

• a more pronounced negative impact from currency on first- and third-quarter gross margins because we ship a higher percentage of international wholesale advance orders for spring and fall, respectively, in those quarters;

• more pronounced SG&A deleverage in the first half of the year, given the anniversary effect of fiscal year 2015 spending initiatives;

• mid-single-digit percentage growth in operating income to between approximately $254 million to $263 million, representing operating margin of up to approximately 10.7 percent, with first half operating profit expected to be approximately $10 million lower than the comparable 2015 period;

• an effective income tax rate of approximately 25.0 percent; and

• high-single-digit percentage growth in net income to between approximately $184 million and $191 million, or $2.60 to $2.70 per diluted share, compared with net income of $174.3 million, or $2.45 per diluted share, in 2015, with first-half net income comparable to the first half of 2015 and full year 2016 profitability growth compared with 2015 concentrated in the second half of the year.

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The above projections are based on the following expectations:

• Mid-single-digit percentage net sales growth from the Columbia brand, high-single-digit percentage net sales growth from the SOREL brand, and high-teen percentage net sales growth from the prAna brand. Mountain Hardwear brand sales are expected to decrease at a high-single-digit percentage rate.

• High-single-digit percentage net sales growth in the U.S. business with DTC growth outpacing wholesale growth.

• Mid-single-digit percentage net sales growth from the EMEA region, with the Europe-direct business contributing high-teen percentage growth, partially offset by mid-teen percentage declines in the EMEA Distributor business due to the continued impact of macroeconomic challenges in Russia.

• Low-single-digit percentage net sales decline in the LAAP region, consisting of a mid-teen percentage decline in Korea and a high-single-digit percentage decline in net sales to LAAP distributors, partially offset by high single-digit percentage growth in Japan and low-single-digit percentage growth in China.

• Low-single-digit percentage net sales decrease in Canada.

• Gross margin expansion of approximately 30 basis points compared with 2015, reflecting:

◦ a greater proportion of DTC net sales, with a corresponding smaller proportion of lower-gross margin distributor and wholesale net sales;

◦ selective price increases in our non-U.S. subsidiaries to partially offset the unfavorable effects of foreign currency pressures; and

◦ a favorable sourcing environment;

partially offset by:

◦ unfavorable foreign currency hedge rates.

• SG&A expense growth rate slightly higher than anticipated consolidated net sales growth, resulting in approximately 40 basis points of SG&A expense deleverage. The increase in projected SG&A expense consists primarily of:

◦ increased expenses to support continued global DTC expansion and operations;

◦ increased personnel expenses to support strategic initiatives and business growth; and

◦ increased expenses related to ongoing information technology initiatives;

partially offset by:

◦ a benefit from foreign currency translation.

• Licensing income of approximately $11.0 million.

• An estimated full-year effective income tax rate of approximately 25.0 percent, compared to an effective income tax rate of 27.3 percent in 2015. The actual rate could differ based on the geographic mix of pre-tax income and other discrete events that may occur during the year.

• An unfavorable impact of approximately $(0.27) on full year 2016 earnings per share, in addition to an estimated unfavorable impact of $(0.10) per share in 2015, due to changes in currency exchange rates, primarily comprising lower gross margins within many of our foreign subsidiaries as a result of increased local currency costs of inventory purchased in U.S. dollars.

• Capital expenditures of approximately $70 million, comprising investments in DTC business expansion, information technology, and project-based and maintenance capital.

• Full year free cash flow totaling approximately $110 million to $130 million.

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Supplemental Constant-Currency Financial Information

The company reports its financial information in accordance with accounting principles generally accepted in the United States (“GAAP”). During periods of significant foreign currency exchange rate volatility, to supplement financial information reported in accordance with GAAP, the company discloses constant-currency net sales information, which is a non-GAAP financial measure, to provide a framework to assess how the business performed excluding the effects of changes in the exchange rates used to translate net sales generated in foreign currencies into U.S. dollars. The Company calculates constant-currency net sales by translating net sales in foreign currencies for the current period into U.S. dollars at the exchange rates that were in effect during the comparable period of the prior year. Management believes that this non-GAAP financial measure reflects an additional and useful way of viewing an aspect of our operations that, when viewed in conjunction with our GAAP results, provides a more comprehensive understanding of our business and operations. In particular, investors may find the non-GAAP measures useful by reviewing our net sales results without the significant volatility in foreign currency exchange rates.  This non-GAAP financial measure also facilitates management’s internal comparisons to our historical net sales results and comparisons to competitors’ net sales results. Constant-currency financial measures should be viewed in addition to, and not in lieu of or superior to, our financial measures calculated in accordance with GAAP. The Company provides a reconciliation of this non-GAAP measure to the most directly comparable financial measure calculated in accordance with GAAP. (See “Supplemental Financial Information - Constant-currency Basis” tables included in the earnings release announcing first quarter financial results located on the investor relations section of the company’s website at http://investor.columbia.com/results.cfm) The constant-currency information presented may not be comparable to similarly titled measures reported by other companies.

Second Quarter 2016 Reporting Schedule

Columbia Sportswear plans to report second quarter 2016 financial results on Thursday, July 28, 2016 at approximately 4:00 p.m. ET. Following issuance of the earnings release, a commentary reviewing the results will be furnished to the SEC on Form 8-K and published on the investor relations section of the company’s website at http://investor.columbia.com/results.cfm.

A public webcast of Columbia’s earnings conference call will follow at 5:00 p.m. ET at www.columbia.com. To receive email notification of future announcements, please visit http://investor.columbia.com/events.cfm and register for E-Mail Alerts.

Forward-Looking Statements

This document contains forward-looking statements within the meaning of the federal securities laws, including statements regarding anticipated results, net sales and net sales growth, gross margins, operating expenses, licensing income, net losses, operating income, operating margins, earnings per share, income tax rates, projected growth in global direct-to-consumer and wholesale businesses, projected growth or decline in specific geographies, countries and brands, inventory, capital expenditures, volatility of foreign currency exchange and hedge rates, and net income. Forward-looking statements often use words such as “will,” “anticipate,” “estimate,” “expect,” “should” and “may” and other words and terms of similar meaning or reference future dates. The company’s expectations, beliefs and projections are expressed in good faith and are believed to have a reasonable basis; however, each forward-looking statement involves a number of risks and uncertainties, including those set forth in this document, those described in the company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q under the heading “Risk Factors,” and those that have been or may be described in other reports filed by the company, including reports on Form 8-K. Potential risks and uncertainties that may affect our future revenues, earnings and performance and could cause the actual results of operations or financial condition of the company to differ materially from the anticipated results expressed or implied by forward-looking statements in this document include: loss of key customer accounts; our ability to effectively implement IT infrastructure and business process initiatives; the effects of unseasonable weather, including global climate change trends; trends affecting consumer traffic and spending in brick and mortar retail channels; our ability to implement our growth strategy; unfavorable economic conditions generally, the financial health of our customers and changes in the level of consumer spending and apparel preferences; changes in international, federal or state tax, labor and other laws and regulations that affect our business, including changes in corporate tax rates or increasing wage rates; volatility in global production and transportation costs and capacity; risks inherent in doing business in foreign markets, including fluctuations in currency exchange rates; our ability to attract and retain key personnel; risks associated with our joint venture; higher than expected rates of order cancellations; increased consolidation of our wholesale customers; our ability to effectively source and deliver our products to customers in a

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timely manner; our dependence on independent manufacturers and suppliers and our ability to source finished products and components at competitive prices from them; the effectiveness of our sales and marketing efforts; intense competition in the industry; business disruptions and acts of terrorism, cyberattacks or military activities around the globe; and our ability to establish and protect our intellectual property. The company cautions that forward-looking statements are inherently less reliable than historical information. The company does not undertake any duty to update any of the forward-looking statements after the date of this document to conform them to actual results or to reflect changes in events, circumstances or its expectations. New factors emerge from time to time and it is not possible for the company to predict or assess the impact of all such factors or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.

End

©2016, Columbia Sportswear Company

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