- The Washington Times - Friday, November 18, 2005

Baltimore sports apparel company Under Armour Inc. scored one of the most successful first days of a public company in five years yesterday, as its shares nearly doubled after debuting on Nasdaq.

The company’s shares, which were priced at $13 each, opened at $31 and held most of that value, closing at $25.30.

Under Armour made $157 million from the initial public offering after selling 12.1 million shares. It will use at least half of that money to cash out major investors and pay off debt.

“The company made out pretty well,” said Melanie Hase, an analyst with Renaissance Capital in Greenwich, Conn. “It’s a well-run company that has produced solid results to date and established a brand that has gotten people’s attention.”

Ms. Hase and Renaissance have no financial relationship with Under Armour.

Under Armour was founded in 1995 by Kevin Plank, a former special teams football player for the University of Maryland. It specializes in making T-shirts and other clothes designed to wick away sweat from the body.

Since being founded in 1995, it has become one of the most visible sports-clothing companies, landing contracts with nearly every major sports league and garnering attention from its television ads featuring the slogan “We must protect this house.”

Under the IPO structure, Mr. Plank will have significant voting control of the company by retaining more than 30 percent of outstanding stock and all of its Class B shares.

Analysts said yesterday’s run-up in share price was great for shareholders, but that company officials may now be wishing they had priced shares higher initially.

“They may be thinking they left 100 percent of the deal on the table,” said David Menlow, president of IPO Financial Network in Millburn, N.J. Mr. Menlow and IPO Financial have no financial relationship with the company.

Under Armour originally had projected an opening share price of between $7.50 and $9.50, but earlier this week increased the target to between $10 and $12.

Company officials declined to comment, citing a quiet period mandated by the Securities and Exchange Commission.

Under Armour’s plan for an IPO generated considerable buzz nationwide. Renaissance Capital this week named the company its “featured IPO,” and the company earned a recommendation from Jim Kramer, the frenetic host of the CNBC program “Mad Money.”

The company’s revenue has increased from $50 million in 2002 to $115 million in 2003 and $205 million in 2004. Sales have grown 43 percent, to $194 million, in the first nine months of 2005. It reported a net income of $12.7 million in the first nine months of 2005, up from $10.2 million a year earlier.

Under Armour historically has concentrated on selling to men, but is expecting to branch out with more clothing lines for women in 2006, and also will begin selling shoes.

Analysts said it was impossible to predict how shares will move. But they said Under Armour should be encouraged by the success of Volcom, a sports apparel manufacturer whose shares have risen nearly 80 percent after becoming a publicly traded company in June.

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