Under Armour to Lay Off 400 Employees

| September 20, 2018 | 0 Comments

As part of its 2018 restructuring plan, Under Amour announced today it will be reducing its global workforce of approximately 13,500 employees by 3% which equates to roughly 400 employees. These layoffs will be completed by March of next year.

Under Armour has not yet identified how many of its approximately 3,700 Greater Baltimore employees (according the the Baltimore Business Journal) will be laid off. An Under Armour spokesperson told SouthBMore.com the following in an email: “We’re not providing that specific level of detail. Baltimore has been the bedrock of our winning brand and we are deeply committed to the city we call home. This community is a key to the innovation that will allow us to reimagine the future. Through this transition, we will be approaching every teammate with the utmost care and respect, but these are necessary steps to become a more operationally excellent company.”

Last August when Under Armour laid off 280 employees, half of them were based in Greater Baltimore.

Under Armour will incur $10 million in cash severance charges with this reduction in its workforce.

Under Armour is currently headquartered at Tide Point in Locust Point and has a distribution facility in Curtis Bay. It is planning a new 50-acre headquarters at Port Covington where it already has one office building. It is also under construction on a 1.3-million sq. ft. distribution facility at Sparrows Point which is expected to open next year.

Under Armour previously announced it would begin construction on Phase 1 of its new campus at Port Covington last year, but that did not move forward. No timetable has been given for when construction will be begin.

The company expects to incur $200 million to $220 million of pre-tax restructuring and related charges in 2018.

“In our relentless pursuit of running a more operationally excellent company, we continue to make difficult decisions to ensure we are best positioned to succeed,” said Under Armour Chief Financial Officer David Bergman in a press release. “This redesign will help simplify the organization for smarter, faster execution, capture additional cost efficiencies, and shift resources to drive greater operating leverage as we move into 2019 and beyond.”

In 2018, Under Armour is expecting to have an operating loss of $60 million due to the restructuring plan. Excluding the impact of the restructuring plan, adjusted operating income is now expected to be $140 million to $160 million.

Under Armour’s stock price saw a 6.6% rise from $18.76 to $20.00 following today’s news. In the past year, the stock has been as high as $24.69 and as low as $11.40.

Under Armour saw revenues rise 6% in the first quarter of this year and 8% in the second quarter.

Photo courtesy of Under Armour

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Founder and Publisher of SouthBmore.com, longtime resident of South Baltimore, and a graduate of Towson University. Diehard Ravens and O's fan, beach volleyball enthusiast, dog lover, and "bar food" foodie. Email me at [email protected] and follow me on Twitter at @SoBoKevin.
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