Gross margin for the full year of 2012 is expected to be around 38.0% compared to 38.7% in 2011. Gross margin in 2012 includes approximately $2.3 million (or 1.3% of expected total sales) for the previously mentioned purchase accounting adjustments. In connection with the Company's conference call announcing actual results for the fourth quarter and full year 2012, the Company expects to present a reconciliation table of adjusted gross margin excluding these purchase accounting adjustments from its full year 2012 financial results, and anticipates adjusted gross margin will reflect an improvement from 2011 primarily attributed to the shift in mix toward higher margin products as well as the inclusion of both POC and PIEPS.
"2012 was a milestone year for Black Diamond as we initiated our acquisition strategy, successfully introduced our new apparel line to the trade and assumed greater control over our manufacturing and distribution," said Peter Metcalf, president and CEO of Black Diamond. "While we achieved record sales, they were affected by the mild winter weather in North America during the holiday shopping season, adding to existing economic uncertainties in both the U.S. and Europe that made for a more cautious consumer.
"Despite these macro headwinds, Black Diamond gained market share in a majority of our product categories, which reflects the proactive investments we've been making in our infrastructure and professional talent. Towards the end of 2012, the North American winter returned to more typical conditions, and similarly, the consumer has returned to purchase more of our seasonal products. Meanwhile, our early spring 2013 bookings have been strong.
"In 2013," concluded Metcalf, "we will continue to invest in our strategic growth initiatives. This includes the next two seasonal launches of our apparel line and further development of our new ski manufacturing facility. These initiatives, among others, are designed to support substantially greater revenue, which we believe will increase our operating leverage and accelerate earnings in the coming years. As one of the most respected and leading outdoor equipment companies in the world, we remain on track to achieve our long-term growth targets."