Joining us in today's call will be Kevin Plank, Chairman, CEO, and President; followed by Brad Dickerson, our Chief Financial Officer, who will discuss the company's financial performance for our third quarter, provide an update to our 2011 outlook, and introduce our preliminary outlook for 2012. After the prepared remarks, Kevin and Brad will be available for a Q&A session that will end at approximately 9:30 a.m. I will then close with a tentative date for our fourth quarter 2011 earnings call. Finally, a replay of this teleconference will be available at our website at approximately 11 a.m. Eastern Time today.And with that, I'll turn it over to Kevin Plank. Kevin A. Plank Thanks, Tom, and good morning, everyone. One of the internal mantras that we use here at Under Armour is focus and finish. It's purpose is to remind ourselves that while the strength of our brand has created abundant prospects for growth, we will be measured on our ability to fully harvest these opportunities in new product categories and geographies. So we look at where we stand at the end of our third quarter, I want to start today with how we are focusing and finishing in our apparel business, and how that is driving us for continued strong results we reported this morning. Our performance in apparel year-to-date has helped enable us to pass last year's full-year revenue number of $1.06 billion in just three quarters this year. In the third quarter, we put up a net revenue increase in excess of 40% for the second consecutive quarter. And not to steal all of Brad's thunder, but third quarter apparel net revenues increased 31%, the fourth consecutive quarter of growth in excess of 30%. So while we continue to lay the foundation for growth in categories like footwear, and new markets like China, we are achieving these strong results by focusing and finishing on the opportunities we see in our core apparel business. Specifically, we're seeing great success in our twofold strategy of innovating to drive better performance product with higher prices in our core, while expanding our reach beyond our core with new products like Charged Cotton. Let me start with our core though, and specifically Armour Fleece, which is exceeding our expectations in helping us drive higher price points at retail. Armour Fleece is our signature synthetic-based fleece with a soft-brushed inner layer in the inside and a lightweight fast drying outer layer. Armour Fleece is helping Under Armour, again redefine the performance category. Much like we did with the basic T-shirt, we have taken the basic hoodie, the go-to apparel product for our core consumer, and raised expectations of what that product can be. And it has enabled us to bring new price points to retail as well. With hoodies ranging from $50 to now more than $75. All of this with the consumer who has been accustomed to playing less than half of that for a hoodie in the past. This is a great example of focusing and finishing, as we take our strategy of reinventing the basics and being performance to the garment. Our Charged Cotton Tees are redefining the T-shirt category and our Charged Cotton Storm Fleece, which I'll speak to in a moment, is the initial phase of redefining that very large category as well. We believe we are one of the very few brands that continue to bring a true performance message to the athletic consumer and that's enabled us to continue raising our consumers' expectations and driving the performance apparel category, which continues to be a bright spot for the industry. Under Armour remains the market leader performance apparel, especially as we continue to take our average selling price up in an environment where others have chosen not to or have been unable to do so.
So while Armour Fleece is driving great volumes and higher price points on its own, we're also bringing the first of our cold weather Charged Cotton Storm product to consumers, and this latest innovation from Under Armour is up to a great start. Storm is really the next generation of protection. We've taken the classic cotton heavyweight sweatshirt with it's heavy weight feel and make it water resistant, so water rolls right off. We're bringing this product to market at price points from $60 to $100 and again, without sounding like a broken record, our consumer has shown a willingness to pay a premium when we can change the way an athlete uses our product. And that's what Charged Cotton storm does.So we think there's a great opportunity here for us to build another wheelhouse product in Charged Cotton Storm. As we've said before, using cotton opens access to the Under Armour brand to a much broader range of athletes. Instead of competing to have 3 out of the 4 compression garments they may have in their closet, we're now competing for share of the 30 plus garments, many of which are cotton. Or to put it in a more quantifiable measure, we've gone from competing for share in a $3 billion category, just a year ago, to competing for share in a $12 billion category today. And that's why the phrase, focus and finish, is at the heart of what how we see the business at this point in our growth. We know there are abundant opportunities for our brand outside of our core and outside of the U.S. but we will not pass up the opportunity to create these new building blocks in our core while the same time bringing the Under Armour brand to new consumers. Innovations like Armour Fleece and our Storm product also give us a much larger tool box of products as we expand outside the U.S.. And we will continue to consistently flow UA innovations to consumers, with next-generation technologies like Coal Black, that reflects heat and UV rays before they get to you. Imagine staying 10 degrees cooler in the summertime because of the effect of the material on your body. That is Coal Black and it's an innovation coming to the market next spring. Read the rest of this transcript for free on seekingalpha.com