Sports apparel company Under Armour Inc. has held its annual shareholder meeting at sports bar and restaurant ESPN Zone ever since going public several years ago. But this year the company brought the event home.
The Baltimore-based company hosted the meeting Tuesday at its recently expanded headquarters at the Tide Point office complex in South Baltimore. The move saves a little money but also brings shareholders to the heart of the company, CEO and founder Kevin Plank told those attending the meeting. The expansion added 14 showrooms where the company can now have big meetings and product demonstrations.
"We don't have to spend the money on ESPN Zone, but we are also able to bring you here to experience the energy of the company," Plank said.
Plank, joined by several other executives and board members, also outlined the company's financial picture and long-term goals. Under Armour predicts revenue in a range of $965 million to $985 million in 2010 — an increase from 2009 revenue of $856 million. The company reiterated that it expects 2010 profit between $1.05 and $1.07 per share.
But Under Armour officials also have said that spending and costs will grow faster than revenue as they focus this year on innovation. The company is revamping its running and training shoes, overhauling its e-commerce site and opening several outlet stores. It plans to announce a new head of its e-commerce division Thursday.
Plank laid out what he called the company's five long-term growth levers — men's apparel, women's apparel, footwear, international and direct to consumer. He said the company believes that in the future sales of women's apparel will outgrow men's apparel and footwear will outgrow all apparel sales.
"The platform we are building is not so much about the 2010 plan as it is the 2020 plan," Plank said.
Shareholders peppered Plank and the other executives with questions about plans for a dividend payout, its interest in expanding to Brazil and how much manufacturing is done in the United States.
And like every year, shareholders were curious about new categories the company might further expand. This year a shareholder asked about golf.
Plank said the company will have to examine further whether it wants to be company that expands into equipment, such as clubs and balls. It already makes golf shirts and other gear.
"The last thing you want to see us do is pile too much on," Plank said.
There are no immediate plans for the company to expand into Brazil or offer a dividend payout.
"As a growth company, it is very important for us to have cash on the balance sheet," said Brad Dickerson, Under Armour's chief financial officer.
Plank said more than 50 percent of the company's manufacturing is done on contract with companies in Asia. About 35 percent is done in Central America, South America and the Caribbean. The remaining is handled in the U.S., Middle East and Europe.
Plank added that the Swann Creek facility in Anne Arundel County is key to the business because of its ability to quickly ship products.