(Reuters) -Under Armour expects its restructuring efforts to cost more than it had previously forecast, the sportswear maker said on Monday, sending its shares down 3% in aftermarket trade.
The company has been looking to turn around its business and sharpen its focus on its core operations under a restructuring plan it unveiled in May, when CEO Kevin Plank said prioritizing too many areas of product strategy had led to inefficiencies and strained resources.
Under Plank, who returned as CEO earlier this year after stepping down in 2019, Under Armour (NYSE:UA) is cutting promotions, inventory and workforce while focusing on selling more higher-margin items such as men's apparel.
The Baltimore-based company expects to incur between $140 million and $160 million in pre-tax restructuring charges in fiscal 2025 and 2026. It had forecast charges of nearly $70 million to $90 million last month.
The higher costs are tied to the company's decision to exit one of its distribution facilities in Rialto, California, Under Armour said.
The company's shares have lost 15% so far this year as of Monday's close. Peers Nike (NYSE:NKE) and Lululemon Athletica (NASDAQ:LULU) have tumbled 27% and 50%, respectively, due to tepid demand and intense competition.
Under Armour expects a net loss between 58 cents and 61 cents per share in fiscal year 2025, compared with its prior forecast of 53 cents to 56 cents loss per share.
It, however, maintained its adjusted earnings per share forecast at 19 cents-22 cents.