What changed in this filing

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Item 1. Financial Statements

2022-08-04 compared with 2022-05-05 · 188 added, 83 removed, 428 unchanged (39% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

(in thousands) March 31,

(in thousands) June 30,

2022 December 31,

2021 March 31,

2021 June 30,

Current Assets:

42 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands, except per share amounts) 2022 2021 2022 2021

6 unchanged sentences

Interest income, net 499 598 894 876

Other non-operating income (expense), net 44 ( 304 )

Other non-operating expense, net ( 1,435 ) ( 294 ) ( 1,391 ) ( 598 )

Income before income tax 7,837 35,299 91,942 105,753

Income tax expense ( 17,268 ) ( 14,554 )

Income tax benefit (expense) ( 674 ) 5,385 ( 17,942 ) ( 9,169 )

Net income $ 7,163 $ 40,684 $ 74,000 $ 96,584

9 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands) 2022 2021 2022 2021

1 unchanged sentence

Other comprehensive income (loss):

Unrealized holding losses on available-for-sale securities (net of tax effects of $ 146 )

Unrealized holding gains (losses) on derivative transactions (net of tax effects of $ 656 and $( 3,368 ), respectively)

Unrealized gains on available-for-sale securities (net of tax effects of $( 146 ))

Unrealized gains (losses) on derivative transactions (net of tax effects of $( 5,744 ), $ 1,183 , $( 5,088 ) and $( 2,185 ), respectively)

15,808 ( 3,551 ) 13,717 5,012

2 unchanged sentences

Other comprehensive income (loss) ( 12,559 ) 1,679 ( 17,357 ) ( 2,962 )

Comprehensive income $ 62,039 $ 51,259

Comprehensive income (loss) $ ( 5,396 ) $ 42,363 $ 56,643 $ 93,622

See accompanying notes to condensed consolidated financial statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

(in thousands) 2022 2021

4 unchanged sentences

Provision for uncollectible accounts receivable ( 4,047 ) ( 9,757 )

Loss on disposal or impairment of intangible assets, property, plant and equipment, and right-of-use assets 1,598 131

Loss on disposal or impairment of investments, property, plant and equipment, and right-of-use assets 2,418 201

Deferred income taxes 3,750 ( 9,667 )

15 unchanged sentences

Capital expenditures ( 28,983 ) ( 12,387 )

Net cash used in investing activities ( 56,778 ) ( 2,842 )

Net cash provided by (used in) investing activities 101,865 ( 11,203 )

Cash flows from financing activities:

20 unchanged sentences

Outstanding Amount

Balance, December 31, 2021

Balance, March 31, 2022

62,948 $ — $ 1,828,074 $ ( 9,174 ) $ 1,818,900

1 unchanged sentence

Other comprehensive income (loss):

Unrealized holding losses on available-for-sale securities, net — — — ( 451 ) ( 451 )

Unrealized holding losses on derivative transactions, net — — — ( 2,091 ) ( 2,091 )

Unrealized gains on available-for-sale securities, net — — — 451 451

Unrealized gains on derivative transactions, net — — — 15,808 15,808

Foreign currency translation adjustment, net — — — ( 28,818 ) ( 28,818 )

5 unchanged sentences

Repurchase of common stock ( 906 ) ( 6,631 ) ( 63,012 ) — ( 69,643 )

Balance, June 30, 2022

62,091 $ — $ 1,753,450 $ ( 21,733 ) $ 1,731,717

(in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total

Outstanding Amount

Balance, March 31, 2021

66,457 $ 22,230 $ 1,850,415 $ ( 3,835 ) $ 1,868,810

Net income — — 40,684 — 40,684

Other comprehensive income (loss):

Unrealized losses on derivative transactions, net — — — ( 3,551 ) ( 3,551 )

Foreign currency translation adjustment, net — — — 5,230 5,230

Cash dividends ($0.26 per share)

— — ( 17,255 ) — ( 17,255 )

Issuance of common stock related to stock-based compensation, net

110 6,433 — — 6,433

Stock-based compensation expense — 4,949 — — 4,949

Repurchase of common stock ( 419 ) ( 33,612 ) ( 10,031 ) — ( 43,643 )

Balance, June 30, 2021

66,148 $ — $ 1,863,813 $ ( 2,156 ) $ 1,861,657

(in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total

4 unchanged sentences

Other comprehensive income (loss):

Unrealized holding gains on derivative transactions, net — — — 8,563 8,563

Unrealized gains on derivative transactions, net

— — — 13,717 13,717

Foreign currency translation adjustment, net — — — ( 31,074 ) ( 31,074 )

5 unchanged sentences

Repurchase of common stock ( 3,235 ) ( 10,688 ) ( 276,252 ) — ( 286,940 )

Balance, March 31, 2021

Balance, June 30, 2022

62,091 $ — $ 1,753,450 $ ( 21,733 ) $ 1,731,717

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 5

Notes to Condensed Consolidated Financial Statements (Unaudited)

(in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total

Outstanding Amount

Balance, December 31, 2020

66,252 $ 20,165 $ 1,811,800 $ 806 $ 1,832,771

Net income — — 96,584 — 96,584

Other comprehensive income (loss):

Unrealized gains on derivative transactions, net — — — 5,012 5,012

Foreign currency translation adjustment, net — — — ( 7,974 ) ( 7,974 )

Cash dividends ($ 0.52 per share)

— — ( 34,540 ) — ( 34,540 )

Issuance of common stock related to stock-based compensation, net

424 14,847 — — 14,847

Stock-based compensation expense — 9,823 — — 9,823

Repurchase of common stock ( 528 ) ( 44,835 ) ( 10,031 ) — ( 54,866 )

Balance, June 30, 2021

66,148 $ — $ 1,863,813 $ ( 2,156 ) $ 1,861,657

See accompanying notes to condensed consolidated financial statements.

5 unchanged sentences

Note 3 Intangible Assets, Net and Goodwill 10

Note 4 Short-Term Borrowings and Credit Lines 11

Note 5 Commitments and Contingencies 11

9 unchanged sentences

NOTE 1 — BASIS OF PRESENTATION AND ORGANIZATION

The accompanying unaudited condensed consolidated financial statements have been prepared by the management of Columbia Sportswear Company (together with its wholly owned subsidiaries, the "Company") and, in the opinion of management, include all normal recurring material adjustments necessary to present fairly the Company's financial position as of March 31, 2022, December 31, 2021 and March 31, 2021, the results of operations for the three months ended March 31, 2022 and 2021, and cash flows for the three months ended March 31, 2022 and 2021.

The accompanying unaudited condensed consolidated financial statements have been prepared by the management of Columbia Sportswear Company (together with its wholly owned subsidiaries, the "Company") and, in the opinion of management, include all normal recurring material adjustments necessary to present fairly the Company's financial position as of June 30, 2022, December 31, 2021 and June 30, 2021, the results of operations for the three and six months ended June 30, 2022 and 2021, and cash flows for the six months ended June 30, 2022 and 2021.

The December 31, 2021 financial information was derived from the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

A significant part of the Company's business is of a seasonal nature;

therefore, results of operations for the three months ended March 31, 2022 are not necessarily indicative of results to be expected for other quarterly periods or for the full year.

therefore, results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of results to be expected for other quarterly periods or for the full year.

Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission.

10 unchanged sentences

RECENT ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

In November 2021, the FASB issued ASU No.

In November 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No.

2021-10 (“ASU 2021-10”), Government Assistance (Topic 832):

10 unchanged sentences

The following tables disaggregate the Company's operating segment Net sales by product category and channel, which the Company believes provides a meaningful depiction of how the nature, timing, and uncertainty of Net sales are affected by economic factors:

Three Months Ended March 31, 2022

Three Months Ended June 30, 2022

(in thousands)

6 unchanged sentences

Wholesale $ 201,880 $ 28,308 $ 47,259 $ 22,449 $ 299,896

DTC 254,385 61,805 19,423 17,673 353,286

Direct-to-consumer 210,605 44,517 10,283 12,762 278,167

Total $ 412,485 $ 72,825 $ 57,542 $ 35,211 $ 578,063

Three Months Ended March 31, 2021

Three Months Ended June 30, 2021

(in thousands)

6 unchanged sentences

Wholesale $ 176,187 $ 32,069 $ 80,552 $ 13,495 $ 302,303

DTC 207,781 56,427 13,001 12,984 290,193

Direct-to-consumer 202,878 45,906 8,022 7,261 264,067

Total $ 379,065 $ 77,975 $ 88,574 $ 20,756 $ 566,370

Six Months Ended June 30, 2022

(in thousands)

LAAP EMEA Canada Total

Product category net sales

Apparel, Accessories and Equipment $ 733,820 $ 140,304 $ 100,811 $ 59,326 $ 1,034,261

Footwear 180,559 54,264 51,448 19,041 305,312

Total $ 914,379 $ 194,568 $ 152,259 $ 78,367 $ 1,339,573

Channel net sales

Wholesale $ 449,389 $ 88,246 $ 122,553 $ 47,932 $ 708,120

Direct-to-consumer 464,990 106,322 29,706 30,435 631,453

Total $ 914,379 $ 194,568 $ 152,259 $ 78,367 $ 1,339,573

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 9

Notes to Condensed Consolidated Financial Statements (Unaudited)

Six Months Ended June 30, 2021

(in thousands)

LAAP EMEA Canada Total

Product category net sales

Apparel, Accessories and Equipment $ 634,245 $ 134,761 $ 110,814 $ 42,140 $ 921,960

Footwear 153,482 55,191 48,525 12,818 270,016

Total $ 787,727 $ 189,952 $ 159,339 $ 54,958 $ 1,191,976

Channel net sales

Wholesale $ 377,068 $ 87,619 $ 138,316 $ 34,713 $ 637,716

Direct-to-consumer 410,659 102,333 21,023 20,245 554,260

Total $ 787,727 $ 189,952 $ 159,339 $ 54,958 $ 1,191,976

PERFORMANCE OBLIGATIONS

For the three months ended March 31, 2022 and 2021, Net sales recognized from performance obligations related to prior periods were not material.

For the three and six months ended June 30, 2022 and 2021, Net sales recognized from performance obligations related to prior periods were not material.

Net sales expected to be recognized in any future period related to remaining performance obligations is not material.

CONTRACT BALANCES

As of March 31, 2022, December 31, 2021 and March 31, 2021, contract liabilities included in Accrued liabilities on the unaudited Condensed Consolidated Balance Sheets, which consisted of obligations associated with the Company's gift card and customer loyalty programs, were not material.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 8

Notes to Condensed Consolidated Financial Statements (Unaudited)

As of June 30, 2022, December 31, 2021 and June 30, 2021, contract liabilities included in Accrued liabilities on the unaudited Condensed Consolidated Balance Sheets, which consisted of obligations associated with the Company's gift card and customer loyalty programs, were not material.

NOTE 3 — INTANGIBLE ASSETS, NET AND GOODWILL

1 unchanged sentence

(in thousands)

March 31, 2022 December 31, 2021 March 31, 2021

June 30, 2022 December 31, 2021 June 30, 2021

Intangible assets with definite lives:

9 unchanged sentences

Intangible assets, net $ 101,083 $ 101,908 $ 102,733

Amortization expense for intangible assets subject to amortization was $ 0.4 million for the three months ended March 31, 2022 and 2021.

Amortization expense for intangible assets subject to amortization was $ 0.4 million for the three months ended June 30, 2022 and 2021, and was $ 0.8 million for the six months ended June 30, 2022 and 2021.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 10

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the remaining estimated annual amortization expense for the years 2022 through 2027:

(in thousands)

NOTE 4 — SHORT-TERM BORROWINGS AND CREDIT LINES

Except as disclosed below, there have been no significant changes to the Company's short-term borrowings and credit lines as described in Note 7 in the Company's Annual Report on Form 10-K for the year ended December 31, 2021.

DOMESTIC CREDIT FACILITY

As of June 30, 2022, the Company had an unsecured, committed revolving credit agreement, maturing on December 30, 2025, which provided for funding up to $ 500.0 million (the "Prior Domestic Credit Agreement").

As of June 30, 2022, the Company was in compliance with all associated covenants and there was no balance outstanding under the facility.

In July 2022, the Company terminated the Prior Domestic Credit Agreement and, simultaneously, entered into a new credit agreement (the “Domestic Credit Agreement”).

The Domestic Credit Agreement provides for up to $500.0 million of borrowings pursuant to an unsecured, committed revolving credit facility (the “Credit Facility”), which is available for working capital and general corporate purposes, including a sublimit for the issuance of letters of credit.

This Credit Facility matures on July 12, 2027.

Interest, payable monthly, is based on the Company's option of either the secured overnight financing rate (“SOFR”) plus an applicable margin or a base rate.

Base rate is defined as the highest of the following, plus an applicable margin:

• the administrative agent's prime rate;

• the higher of the federal funds rate or overnight bank funding rate set by the Federal Reserve Bank of New York, plus 0.50%;

• the one-month SOFR plus 1.00%.

The applicable margin for SOFR loans will range from 1.00% to 1.50% based on the Company’s funded debt ratio.

The applicable margin for base rate loans will range from 0.00% to 0.50% based on the Company’s funded debt ratio.

The Domestic Credit Agreement requires the Company to comply with a financial covenant to maintain a certain funded debt ratio.

In addition, the Domestic Credit Agreement includes customary covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries to incur additional indebtedness and liens, engage in mergers, acquisitions and dispositions, and engage in transactions with affiliates, as well as restrict the amount of certain payments, including dividends and share buybacks in the event the Company's funded debt ratio is greater than a set amount.

NOTE 5 — COMMITMENTS AND CONTINGENCIES

4 unchanged sentences

NOTE 6 — SHAREHOLDERS' EQUITY

Since the inception of the Company's stock repurchase plan in 2004 through March 31, 2022, the Company's Board of Directors has authorized the repurchase of $ 1.5 billion of the Company's common stock.

Since the inception of the Company's stock repurchase plan in 2004 through June 30, 2022, the Company's Board of Directors has authorized the repurchase of $ 2.0 billion of the Company's common stock, including an additional $500 million approved by the Company’s Board of Directors at its regular board meeting in April 2022.

Shares of the Company's common stock may be purchased in the open market or through privately negotiated transactions, subject to market conditions, and generally settle subsequent to the trade date.

The repurchase program does not obligate the Company to acquire any specific number of shares or to acquire shares over any specified period of time.

Under this program as of March 31, 2022, the Company had repurchased 30.8 million shares at an aggregate purchase price of $ 1,401.0 million and had $ 99.0 million remaining available.

During the three months ended March 31, 2022, the Company repurchased an aggregate of $ 217.3 million of common stock under this program.

In April 2022, the Company's Board of Directors approved a $ 500.0 million increase in share repurchase authorization.

Under this program as of June 30, 2022, the Company had repurchased 31.7 million shares at an aggregate purchase price of $ 1,470.6 million and had $ 529.4 million remaining available.

During the three and six months ended June 30, 2022, the Company repurchased an aggregate of $69.6 million and $ 286.9 million, respectively, of the Company's common stock under this program.

NOTE 7 — STOCK-BASED COMPENSATION

3 unchanged sentences

Stock-based compensation expense consisted of the following:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands) 2022 2021 2022 2021

3 unchanged sentences

STOCK OPTIONS

During the three months ended March 31, 2022, the Company granted a total of 536,436 stock options at a weighted average grant date fair value of $ 18.36 per option.

As of March 31, 2022, unrecognized costs related to outstanding stock options totaled $ 19.2 million, before any related tax benefit.

During the six months ended June 30, 2022, the Company granted a total of 546,681 stock options at a weighted average grant date fair value of $ 18.33 per option.

As of June 30, 2022, unrecognized costs related to outstanding stock options totaled $ 16.9 million, before any related tax benefit.

These unrecognized costs related to stock options are expected to be recognized over a weighted average remaining period of 2.66 years.

RESTRICTED STOCK UNITS

During the three months ended March 31, 2022, the Company granted 206,787 restricted stock units at a weighted average grant date fair value of $ 86.74 per restricted stock unit.

As of March 31, 2022, unrecognized costs related to outstanding restricted stock units totaled $ 30.6 million, before any related tax benefit.

During the six months ended June 30, 2022, the Company granted 239,309 restricted stock units at a weighted average grant date fair value of $ 85.82 per restricted stock unit.

As of June 30, 2022, unrecognized costs related to outstanding restricted stock units totaled $ 28.6 million, before any related tax benefit.

These unrecognized costs related to restricted stock units are expected to be recognized over a weighted average remaining period of 2.73 years.

6 unchanged sentences

A reconciliation of the common shares used in the denominator for computing basic and diluted EPS is as follows:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands, except per share amounts)

2022 2021 2022 2021

Weighted average common shares outstanding, used in computing basic earnings per share

6 unchanged sentences

Diluted $ 0.11 $ 0.61 $ 1.16 $ 1.44

Stock options, service-based restricted stock units, and performance-based restricted stock representing 1,230,716 and 693,403 shares of common stock for the three months ended March 31, 2022 and 2021, respectively, were outstanding but were excluded from the computation of diluted EPS because their effect would be anti-dilutive under the treasury stock method or because the shares were subject to performance conditions that had not been met.

Stock options, service-based restricted stock units, and performance-based restricted stock units representing 2,060,703 and 611,143 shares of common stock for the three months ended June 30, 2022 and 2021, respectively, and 1,709,085 and 793,051 shares of common stock for the six months ended June 30, 2022 and 2021, respectively, were outstanding but were excluded from the computation of diluted EPS because their effect would be anti-dilutive under the treasury stock method or because the shares were subject to performance conditions that had not been met.

NOTE 9 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Accumulated other comprehensive income (loss) on the unaudited Condensed Consolidated Balance Sheets is net of applicable taxes, and consists of unrealized holding gains and losses on available-for-sale securities, unrealized gains and losses on certain derivative transactions and foreign currency translation adjustments.

The following table sets forth the changes in Accumulated other comprehensive income (loss) attributable to the Company:

(in thousands) Unrealized holding losses on available-for-sale securities Unrealized holding gains (losses) on derivative transactions Foreign currency

Accumulated other comprehensive income (loss) on the unaudited Condensed Consolidated Balance Sheets is net of applicable taxes, and consists of unrealized gains and losses on available-for-sale securities, unrealized gains and losses on certain derivative transactions and foreign currency translation adjustments.

The following tables set forth the changes in Accumulated other comprehensive income (loss) :

(in thousands) Unrealized gains (losses) on available-for-sale securities Unrealized gains (losses) on derivative transactions Foreign currency

adjustments Total

Balance as of December 31, 2021

Balance as of March 31, 2022

$ ( 451 ) $ 7,823 $ ( 16,546 ) $ ( 9,174 )

3 unchanged sentences

Net other comprehensive income (loss) during the year 451 15,808 ( 28,818 ) ( 12,559 )

Balance as of March 31, 2022

Balance as of June 30, 2022

$ — $ 23,631 $ ( 45,364 ) $ ( 21,733 )

(1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating income (expense), net on the unaudited Condensed Consolidated Statements of Operations.

(1) Amounts reclassified are recorded in Net sales, Cost of sales or Other non-operating expense, net on the unaudited Condensed Consolidated Statements of Operations.

Refer to Note 11 for further information regarding reclassifications.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements (Unaudited)

(in thousands) Unrealized holding

gains (losses) on

derivative transactions Foreign currency

(in thousands) Unrealized gains (losses) on derivative transactions Foreign currency

adjustments Total

Balance as of March 31, 2021

$ ( 806 ) $ ( 3,029 ) $ ( 3,835 )

Other comprehensive income (loss) before reclassifications ( 3,903 ) 5,230 1,327

Amounts reclassified from accumulated other comprehensive income (loss) (1)

Net other comprehensive income (loss) during the year ( 3,551 ) 5,230 1,679

Balance as of June 30, 2021

$ ( 4,357 ) $ 2,201 $ ( 2,156 )

(1) Amounts reclassified are recorded in Net sales or Cost of sales on the unaudited Condensed Consolidated Statements of Operations.

Refer to Note 11 for further information regarding reclassifications.

(in thousands) Unrealized gains (losses) on available-for-sale securities Unrealized gains (losses) on derivative transactions Foreign currency

adjustments Total

Balance as of December 31, 2021

4 unchanged sentences

Net other comprehensive income (loss) during the year — 13,717 ( 31,074 ) ( 17,357 )

Balance as of March 31, 2021

Balance as of June 30, 2022

$ — $ 23,631 $ ( 45,364 ) $ ( 21,733 )

(1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating income (expense), net on the unaudited Condensed Consolidated Statements of Operations.

(1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating expense, net on the unaudited Condensed Consolidated Statements of Operations.

Refer to Note 11 for further information regarding reclassifications.

(in thousands) Unrealized gains (losses) on derivative transactions Foreign currency

adjustments Total

Balance as of December 31, 2020

$ ( 9,369 ) $ 10,175 $ 806

Other comprehensive income (loss) before reclassifications 5,376 ( 7,974 ) ( 2,598 )

Amounts reclassified from accumulated other comprehensive income (loss) (1)

( 364 ) — ( 364 )

Net other comprehensive income (loss) during the year 5,012 ( 7,974 ) ( 2,962 )

Balance as of June 30, 2021

$ ( 4,357 ) $ 2,201 $ ( 2,156 )

(1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating expense, net on the unaudited Condensed Consolidated Statements of Operations.

Refer to Note 11 for further information regarding reclassifications.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 14

Notes to Condensed Consolidated Financial Statements (Unaudited)

NOTE 10 — SEGMENT INFORMATION

2 unchanged sentences

Each geographic segment operates predominantly in one industry:

the design, development, marketing, and distribution of outdoor, active and everyday lifestyle apparel, footwear, accessories, and equipment products.

the design, development, marketing, and distribution of outdoor, active and lifestyle products, including apparel, footwear, accessories, and equipment.

Intersegment net sales and intersegment profits, which are recorded at a negotiated mark-up and eliminated in consolidation, are not material.

Unallocated corporate expenses consist of expenses incurred by centrally-managed departments, including global information services, finance, human resources and legal, as well as executive compensation, unallocated benefit program expense, and other miscellaneous costs.

Unallocated corporate expenses consist of expenses incurred by centrally-managed departments, including global information services, certain supply chain functions, finance, human resources and legal, as well as executive compensation, unallocated benefit program expense, and other miscellaneous costs.

The following table presents financial information for the Company's reportable segments:

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

(in thousands)

2022 2021 2022 2021

Net sales to unrelated entities:

4 unchanged sentences

$ 578,063 $ 566,370 $ 1,339,573 $ 1,191,976

Segment operating income:

Segment operating income (loss)

$ 67,346 $ 82,057 $ 180,522 $ 181,718

5 unchanged sentences

Interest income, net 499 598 894 876

Other non-operating income (expense), net 44 ( 304 )

Other non-operating expense, net ( 1,435 ) ( 294 ) ( 1,391 ) ( 598 )

Income before income tax $ 7,837 $ 35,299 $ 91,942 $ 105,753

CONCENTRATIONS

The Company had one customer that accounted for approximately 13.0 %, 14.3 % and 10.2 % of Accounts receivable, net as of March 31, 2022, December 31, 2021, and March 31, 2021, respectively.

No single customer accounted for 10% or more of Net sales for any of the three months ended March 31, 2022 and March 31, 2021, respectively.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 12

Notes to Condensed Consolidated Financial Statements (Unaudited)

The Company had one customer that accounted for approximately 12.3 %, 14.3 % and 12.5 % of Accounts receivable, net as of June 30, 2022, December 31, 2021, and June 30, 2021, respectively.

The Company did not have a customer that accounted for 10% or more of Net sales for the three and six months ended June 30, 2022 and June 30, 2021.

NOTE 11 — FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

6 unchanged sentences

Subsidiaries that use United States dollars and European euros as their functional currency also have non-functional currency denominated sales for which the Company hedges the Canadian dollar and British pound.

The Company manages these risks by using currency forward contracts formally designated and effective as cash flow hedges.

The Company seeks

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 15

Notes to Condensed Consolidated Financial Statements (Unaudited)

to manage these risks by using currency forward contracts formally designated and effective as cash flow hedges.

Hedge effectiveness is generally determined by evaluating the ability of a hedging instrument's cumulative change in fair value to offset the cumulative change in the present value of expected cash flows on the underlying exposures.

3 unchanged sentences

Non-functional currency denominated monetary assets and liabilities consist primarily of cash and cash equivalents, short-term investments, receivables, payables, deferred income taxes, and intercompany loans.

The gains and losses generated on these currency forward contracts not formally designated as hedges are expected to be largely offset in Other non-operating income (expense), net by the gains and losses generated from the remeasurement of the non-functional currency denominated monetary assets and liabilities.

The gains and losses generated on these currency forward contracts not formally designated as hedges are expected to be largely offset in Other non-operating expense, net by the gains and losses generated from the remeasurement of the non-functional currency denominated monetary assets and liabilities.

The following table presents the gross notional amount of outstanding derivative instruments:

(in thousands) March 31, 2022 December 31, 2021 March 31, 2021

(in thousands) June 30, 2022 December 31, 2021 June 30, 2021

Derivative instruments designated as cash flow hedges:

2 unchanged sentences

Currency forward contracts 239,676 267,982 258,377

As of March 31, 2022, $ 5.1 million of deferred net gains on both outstanding and matured derivatives recorded in Accumulated other comprehensive income (loss) are expected to be reclassified to Net income during the next twelve months as a result of underlying hedged transactions also being recorded in Net sa les, Cost of sales, or Other non-operating income (expense) in the unaudited Condensed Consolidated Statements of Operations.

When outstanding derivative contracts mature, actual amounts ultimately reclassified to Net sa les, Cost of sales, or Other non-operating income (expense) in the unaudited Condensed Consolidated Statements of Operations are dependent on United States dollar exchange rates in effect against the euro, pound sterling, renminbi, Canadian dollar, and yen as well as the euro exchange rate in effect against the pound sterling.

As of March 31, 2022, the Company's derivative contracts had a remaining maturity of less than three years .

The maximum net exposure to any single counterparty, which is generally limited to the aggregate unrealized gain of all contracts with that counterparty, was $ 5.3 million as of March 31, 2022.

As of June 30, 2022, $ 17.4 million of deferred net gains on both outstanding and matured derivatives recorded in Accumulated other comprehensive income (loss) are expected to be reclassified to Net income during the next twelve months as a result of underlying hedged transactions also being recorded in Net sa les, Cost of sales, or Other non-operating expense in the unaudited Condensed Consolidated Statements of Operations.

When outstanding derivative contracts mature, actual amounts ultimately reclassified to Net sa les, Cost of sales, or Other non-operating expense in the unaudited Condensed Consolidated Statements of Operations are dependent on United States dollar exchange rates in effect against the euro, pound sterling, renminbi, Canadian dollar, and yen as well as the euro exchange rate in effect against the pound sterling.

As of June 30, 2022, the Company's derivative contracts had a remaining maturity of less than three years .

The maximum net exposure to any single counterparty, which is generally limited to the aggregate unrealized gain of all contracts with that counterparty, was $ 9.4 million as of June 30, 2022.

All of the Company's derivative counterparties have credit ratings that are investment grade or higher.

5 unchanged sentences

(in thousands) Balance Sheet

Classification March 31, 2022 December 31, 2021 March 31, 2021

Classification June 30, 2022 December 31, 2021 June 30, 2021

Derivative instruments designated as cash flow hedges:

11 unchanged sentences

The following table presents the statement of operations effect and classification of derivative instruments:

Statement Of Operations Classification Three Months Ended March 31,

Classification Three Months Ended June 30,

Six Months Ended June 30,

(in thousands) 2022 2021 2022 2021

3 unchanged sentences

— $ 16,453 $ ( 3,903 ) $ 14,589 $ 5,376

Gain (loss) reclassified from accumulated other comprehensive income (loss) to income for the effective portion

Loss reclassified from accumulated other comprehensive income (loss) to income for the effective portion

Net sales ( 40 ) ( 111 ) ( 176 ) ( 11 )

Gain reclassified from accumulated other comprehensive income (loss) to income for the effective portion

Gain (loss) reclassified from accumulated other comprehensive income (loss) to income for the effective portion

Cost of sales 948 ( 348 ) 1,259 424

Gain reclassified from accumulated other comprehensive income (loss) to income as a result of cash flow hedge discontinuance

Other non-operating income (expense), net 222 106

Other non-operating expense, net — — 222 106

Derivative instruments not designated as cash flow hedges:

Gain recognized in income

Other non-operating income (expense), net 590 897

Gain (loss) recognized in income

Other non-operating expense, net 707 ( 1,619 ) 1,297 ( 722 )

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 17

10 unchanged sentences

Level 2 instrument valuations are obtained from inputs, other than quoted market prices in active markets, that are directly or indirectly observable in the marketplace and quoted prices in markets with limited volume or infrequent transactions.

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 are as follows:

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 are as follows:

(in thousands) Level 1 Level 2 Level 3 Total

1 unchanged sentence

Money market funds $ 30,141 $ — $ — $ 30,141

Available-for-sale short-term investments:

Government treasury bills — 174,435 — 174,435

Other short-term investments:

Short-term investments:

Money market funds 81 — — 81

12 unchanged sentences

Total liabilities measured at fair value $ — $ 2,115 $ — $ 2,115

(1) Available-for-sale short-term investments have remaining maturities of less than one year.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 18

6 unchanged sentences

Government treasury bills — 130,168 — 130,168

Short-term investments:

Other short-term investments:

Money market funds 73 — — 73

15 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Assets and liabilities measured at fair value on a recurring basis as of March 31, 2021 are as follows:

Assets and liabilities measured at fair value on a recurring basis as of June 30, 2021 are as follows:

(in thousands) Level 1 Level 2 Level 3 Total

1 unchanged sentence

Money market funds $ 159,897 $ — $ — $ 159,897

United States government treasury bills — 45,000 — 45,000

Short-term investments:

13 unchanged sentences

Total liabilities measured at fair value $ — $ 11,577 $ — $ 11,577

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 20

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements