Columbia Sportswear Co.‘s third quarter sales were $471.1 million, an increase of 4% compared to net sales of $454.1 million for the same period of 2006. Net income dropped 4% to $62.6 million, or $1.72 a share. Among categories, sales increased 10% to $161.9 million in sportswear, 3% to $71.4 million in footwear, and 8% to $22 million in accessories and equipment. Outerwear sales decreased 1% to $215.8 million.

Among regions, U.S. sales increased 3% to $284.2 million, Other International net sales increased 28% to $73.8 million, and Canada sales increased 8% to $57.8 million. Europe sales decreased 17% to $55.3 million.

Excluding changes in currency exchange rates, consolidated sales increased 2%, Other International sales increased 28%, U.S. sales increased 3%, Canada sales increased 2% and Europe sales decreased 22%.

Among brands, Columbia’s sales increased 7% to $418.2 million and Mountain Hardwear sales grew 14% to $29.5 million. On the downside, Sorel sales decreased 9% to $19.1 million, Montrail sales decreased 28% to $2.6 million and Pacific Trail decreased 87% to $1.7 million for the third quarter of 2007.

Tim Boyle, Columbia‘s president and CEO, said, “We are pleased to report that third quarter sales were driven by double digit growth in Columbia brand outerwear in the United States and Canada, reflecting the initiatives our management team has taken to strengthen our core North American Columbia brand outerwear business. Growth in the quarter was also driven by Columbia brand sportswear sales in the United States and increased sales in all major product categories in International Distributor markets. This growth was offset by significant expected declines in Pacific Trail outerwear in the United States and outerwear and sportswear in Europe. Despite difficult economic conditions, particularly in the United States, we continue to expect operating margin expansion this year, demonstrating consistent financial management discipline.’‘

Backlog

Columbia reported that as of September 30, 2007, spring backlog was essentially flat at $414.4 million, compared to spring backlog of $414.5 million at September 30, 2006. Consolidated product backlog, which includes both global fall and spring orders at September 30, 2007, was $692.7 million, also essentially flat compared to consolidated product backlog of $693.9 million at September 30, 2006.

Boyle commented, “Geographically, spring orders increased in our Asia Direct and International Distributor markets, and decreased in the U.S. and Europe. As reviewed by product category, global spring apparel orders were flat, spring footwear orders decreased modestly and spring accessories and equipment increased modestly. As discussed previously, cool and wet weather conditions in the United States this spring hampered sell through of our spring products, leading to significant order cancellations this year and reducing demand for spring 2008 orders in the U.S. We are disappointed with these results.’‘

Marketing and Advertising Initiatives

Beginning in 2008, Columbia intends to increase spending on marketing and advertising initiatives to increase consumer brand awareness and to stimulate consumer demand.

“In spring 2008, we will initiate a coordinated and targeted marketing, advertising and public relations campaign globally that will educate consumers about OMNI-SHADE(tm) and TECHLITE(tm). We believe initiatives like these, and others we will establish, will continue to reinforce the outdoor authenticity of our brands and drive retail sell through of our products. We are increasing our focus on communicating the performance proposition of our brands directly to consumers, to heighten consumer awareness and drive consumer demand,’‘ said Mr. Boyle.

U.S. Retail

Columbia also expanded its U.S. retail initiative to strengthen wholesale distribution, primarily focused on inventory management through retail outlet stores. This U.S. retail initiative will also include first-line Columbia brand retail stores, to demonstrate product breadth and to heighten consumer awareness of our brands.

Boyle continued, “To strengthen our wholesale business, we need the inventory flexibility and brand management opportunities provided by a direct-to-consumer retail operation. For the past year we have been evaluating and testing a measured increase in U.S. direct-to-consumer retail operations to enhance our wholesale distribution. We have added personnel and infrastructure throughout the year to support this initiative. Our retail initiative is primarily focused on inventory management through retail outlet stores located in geographically remote factory outlet malls throughout the U.S. This year we anticipate opening five new U.S. retail outlets, and we currently plan to open up to 15 outlet stores per year in the U.S. over the next few years, although we will evaluate this on an ongoing basis. Retail outlet stores reduce our exposure to excessive inventory due to negative weather conditions.’‘

“In addition to retail outlet stores, we anticipate opening a few first-line Columbia brand retail stores in key U.S. markets over the next few years, to showcase the breadth of our products in a comprehensive retail environment and to heighten consumer awareness of our brands. The first-line Columbia stores will create a distinctive ’Columbia‘ environment, communicating our key product and marketing initiatives, showcasing the breadth of our products and reinforcing the active and outdoor image of the Columbia brand. These Columbia brand stores and key product and marketing initiatives are designed to enhance our wholesale business by stimulating consumer demand and driving consumer pull-through of our products in all distribution channels. Our primary focus is to remain a wholesale business, and we are dedicated to serving our wholesale customers,’‘ continued Boyle.

“We are approaching this broadened U.S. retail initiative in a measured and pragmatic manner to enhance our wholesale distribution. We will continue to monitor our results as we execute our plan. We are pleased with the initial results this year, which give us confidence to continue with our plans. The expanded retail initiative, coupled with our planned increases in marketing and advertising next year, may preclude us from achieving operating margin leverage in 2008; however, we expect these initiatives will strengthen our brands and will be accretive to earnings long-term,’‘ concluded Boyle.

Dividend and Share Repurchase

The company announced today that the board of directors has approved an increased dividend of 16 cents per share, payable on November 29, to shareholders of record on November 15. During the third quarter, the company did not repurchase any shares of common stock.

Guidance

Boyle continued, “Based on our current outlook, we anticipate fourth quarter 2007 revenue growth of approximately three percent compared to the fourth quarter of 2006 and diluted earnings per share of approximately $1.00. For the full year 2007, we anticipate net sales growth of approximately five percent compared to 2006, and are increasing full year diluted earnings per share guidance to approximately $3.70.’

Boyle concluded, “Based in part on the reported spring backlog and the initiatives announced today, we expect revenue growth for the first quarter of 2008 of approximately 4 percent and diluted earnings per share of approximately $0.60. As a reminder, spring accounts for a relatively small percentage of our overall business; the bulk of our revenues and profits historically comes in the second half of the year. Further out, it is difficult for us to gauge revenue and profitability levels until we gain more visibility into the fall 2008 season. We will provide full year 2008 financial guidance when we report our fall backlog results in April 2008. Please note that these projections are forward-looking in nature, and are based on backlog and forecasts, which may change, perhaps significantly.’