Record Net Sales of $800.5 Million, an
Increase of 36.4 Percent
Record Earnings from Operations of $112.3
Million
Record Net Earnings of $79.8 Million
Record Diluted Earnings per Share of
$1.55
SKECHERS USA, Inc. (NYSE:SKX), a global leader in footwear,
today announced financial results for the second quarter ended June
30, 2015.
Second quarter 2015 net sales were $800.5 million compared to
$587.1 million for the second quarter of 2014. Gross profit for the
second quarter of 2015 was $374.6 million, or 46.8 percent of net
sales, compared to $269.4 million, or 45.9 percent of net sales,
for the second quarter of last year. Earnings from operations for
the second quarter of 2015 were $112.3 million, or 14.0 percent of
net sales, compared to net earnings from operations of $53.8
million, or 9.2 percent of net sales for the second quarter of
2014.
Net earnings in the second quarter of 2015 were $79.8 million
compared to net earnings of $34.8 million for the second quarter of
2014. Diluted net earnings per share in the second quarter of 2015
were $1.55 based on 51.3 million weighted average shares
outstanding compared to diluted net earnings per share of $0.68
based on 50.9 million weighted average shares outstanding for the
same period last year.
“The continued strong demand for our product worldwide led to
record quarterly financial results for the second quarter—including
net sales, earnings from operations and earnings per share. Our
second quarter net sales of more than $800 million combined with
record sales in the first quarter resulted in the Company achieving
$1.57 billion in sales for the first half of 2015,” began David
Weinberg, chief operating officer and chief financial officer.
“Driving this growth were double-digit increases in our three main
business channels: domestic wholesale with an average price per
pair increase of 9.0 percent; international wholesale, which
includes 665 third-party-owned Skechers retail stores; and
Company-owned Skechers domestic and international retail stores
with a total comp store sales increase of 12.9 percent for the
quarter. Furthermore, the second quarter benefitted from both pent
up demand resulting from U.S. port issues in the first quarter as
well as a shift in back-to-school shipments due to increased demand
in both domestic and international markets. Our international
subsidiary business also remained strong with double-digit
increases despite currency headwinds in several key markets.”
For the six months ended June 30, 2015, net sales were $1.57
billion compared to net sales of $1.13 billion in the first six
months of 2014. Gross profit for the first six months of 2015 was
$707.1 million, or 45.1 percent of net sales, compared to $509.8
million, or 45.0 percent of net sales, for the first six months of
2014. Earnings from operations for the first six months of 2015
were $200.5 million, or 12.8 percent of net sales, compared to
earnings from operations of $101.9 million, or 9.0 percent of net
sales, for the first six months of 2014.
Net earnings in the first six months of 2015 were $135.9 million
compared to net earnings of $65.8 million in the same period last
year. For the first six months of 2015, diluted net earnings per
share were $2.65 based on 51.3 million weighted average common
shares outstanding compared to diluted net earnings per share of
$1.29 based on 50.9 million weighted average common shares
outstanding for the first six months of 2014.
Robert Greenberg, SKECHERS chief executive officer, commented:
“Skechers is clearly in the midst of the most exciting time in the
Company’s 23-year history. The present has never looked as
colorful, comfortable and successful thanks to our product and
marketing, and resulting record sales, shipments and earnings. We
just announced the signing of global pop singer Meghan Trainor, and
together with Demi Lovato we are capturing the attention of 12 to
24 year olds worldwide. During the second quarter, we announced
that boxing great Sugar Ray Leonard joined our team of accomplished
athletes and brand ambassadors, including Pete Rose and his
#PeteintheHall campaign. Together, they and legendary musician
Ringo Starr are speaking to Generation X and Baby Boomers with
their humorous television commercials for Skechers Relaxed Fit
footwear. Our numerous other impactful lifestyle campaigns along
with our targeted marketing for Skechers Performance and Skechers
Kids lines are resonating with our diverse consumer base. Our
efforts in product and marketing also resulted in Skechers becoming
the No. 2 athletic footwear brand and the No. 1 walking brand in
the United States. While domestic wholesale remains the largest
piece of our business at 42 percent, the highest channel increase
in the second quarter came from our international segment, which
improved by 60 percent and now represents 30 percent of our total
sales. With 1,126 Skechers retail stores worldwide, including the
new markets of Czech Republic, Nigeria and Alaska, our global
footprint is expanding steadily with additional Skechers stores
already opened in the third quarter by our international
distribution partners in Russia, Australia, Taiwan and Ireland, a
joint venture store in India, and another six domestic and
international Company-owned stores. The demand for Skechers
footwear in markets worldwide continues, and we are excited for
several new product introductions coming later this year—including
Star Wars® from Skechers shoes for boys and men, along with some
developments in our Skechers Performance and athletic lifestyle
divisions. We believe that our accelerated growth trend will remain
through 2015 and into 2016.”
Mr. Weinberg added: “Our record first half of 2015 follows a
record 2014, and is a result of the universal demand for our wide
assortment of diverse footwear collections for men, women and kids.
At no other time in the history of our company have so many product
lines resonated with consumers, giving us a broad base to continue
to build upon and grow. With increased year-over-year backlogs at
the end of June, strong incoming order rates and July sales, as
well as the positive sell-through reports from wholesale and an
additional 125 to 135 Company-owned and third-party-owned Skechers
retail stores planned to open later this year, we believe that we
will continue to achieve new sales and profit records through 2015.
With $513.9 million in cash, inventories in line with sales, and
improved efficiencies and capacity in both our North American and
European distribution centers, we believe we are well prepared for
our planned growth. We remain comfortable with the analysts’
current consensus estimates for the back half of 2015.”
About SKECHERS USA,
Inc.SKECHERS USA, Inc., based in Manhattan Beach,
California, designs, develops and markets a diverse range of
lifestyle footwear for men, women and children, as well as
performance footwear for men and women. SKECHERS footwear is
available in the United States and over 120 countries and
territories worldwide via department and specialty stores, more
than 1,100 SKECHERS retail stores, and the Company’s e-commerce
website. The Company manages its international business through a
network of global distributors, joint venture partners in Asia, and
12 wholly-owned subsidiaries in Brazil, Canada, Chile, Japan and
throughout Europe. For more information, please visit skechers.com
and follow us on Facebook (facebook.com/SKECHERS) and Twitter
(twitter.com/SKECHERSUSA).
This announcement contains forward-looking statements that are
made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include, without limitation, the Company’s future
growth, financial results and operations, its development of new
products, future demand for its products and growth opportunities,
its planned opening of new stores, advertising and marketing
initiatives, and the expansion plans for the Company’s European
Distribution Center. Forward-looking statements can be identified
by the use of forward looking language such as “believe,”
“anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,”
“will be,” “will continue,” “will result,” “could,” “may,” “might,”
or any variations of such words with similar meanings. Any such
statements are subject to risks and uncertainties that could cause
actual results to differ materially from those projected in
forward-looking statements. Factors that might cause or contribute
to such differences include international economic, political and
market conditions including the uncertainty of sustained recovery
in Europe; entry into the highly competitive performance footwear
market; sustaining, managing and forecasting costs and proper
inventory levels; losing any significant customers; decreased
demand by industry retailers and cancellation of order commitments
due to the lack of popularity of particular designs and/or
categories of products; maintaining brand image and intense
competition among sellers of footwear for consumers; anticipating,
identifying, interpreting or forecasting changes in fashion trends,
consumer demand for the products and the various market factors
described above; sales levels during the spring, back-to-school and
holiday selling seasons; and other factors referenced or
incorporated by reference in the Company’s annual report on Form
10-K for the year ended December 31, 2014 and its quarterly report
on Form 10-Q for the three months ended March 31, 2015. The risks
included here are not exhaustive. The Company operates in a very
competitive and rapidly changing environment. New risks emerge from
time to time and the companies cannot predict all such risk
factors, nor can the companies assess the impact of all such risk
factors on their respective businesses or the extent to which any
factor, or combination of factors, may cause actual results to
differ materially from those contained in any forward-looking
statements. Given these risks and uncertainties, you should not
place undue reliance on forward-looking statements as a prediction
of actual results. Moreover, reported results should not be
considered an indication of future performance.
SKECHERS U.S.A., INC. AND SUBSIDIARIES CONDENSED
CONSOLIDATED BALANCE SHEETS (Unaudited) (In
thousands)
June 30,2015
December 31,2014
ASSETS Current Assets: Cash and cash
equivalents $ 513,902 $ 466,685 Trade accounts receivable, net
434,191 272,103 Other receivables 15,314
16,510 Total receivables 449,505 288,613 Inventories 470,640
453,837 Prepaid expenses and other current assets 51,633 57,015
Deferred tax assets 18,866 18,864 Total
current assets 1,504,546 1,285,014 Property, plant and equipment,
net 381,853 373,183 Other assets 26,126
16,721 Total non-current assets 407,979
389,904 TOTAL ASSETS
$ 1,912,525
$ 1,674,918 LIABILITIES
AND EQUITY Current Liabilities: Current installments of
long-term borrowings $ 109,290 $ 101,407 Accounts payable 430,422
352,815 Short-term borrowings 1,340 1,810 Accrued expenses
53,626 49,705 Total current liabilities
594,678 505,737 Long-term borrowings, net of current installments
1,592 15,081 Other long-term liabilities 24,400
19,993 Total non-current liabilities 25,992
35,074 Total liabilities 620,670 540,811
Stockholders’ equity: Skechers U.S.A., Inc. equity 1,222,210
1,075,249 Noncontrolling interests 69,645
58,858 Total equity 1,291,855
1,134,107 TOTAL LIABILITIES AND EQUITY
$
1,912,525 $
1,674,918 SKECHERS U.S.A., INC. AND
SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF
EARNINGS (Unaudited) (In thousands, except per share
data) Three Months Ended June 30,
Six Months Ended June 30,
2015 2014
2015 2014 Net sales
$ 800,464 $ 587,051 $ 1,568,461 $ 1,133,569 Cost of sales
425,856 317,676
861,313 623,791 Gross profit 374,608
269,375 707,148 509,778 Royalty income 3,630
1,836 5,512
4,858 378,238 271,211
712,660 514,636
Operating expenses: Selling 64,875 53,839 113,967 90,581 General
and administrative 201,021 163,616
398,162 322,139
265,896 217,455
512,129 412,720 Earnings
from operations 112,342 53,756 200,531 101,916 Other income
(expense): Interest, net (2,884 ) (3,459 ) (5,534 ) (6,052 ) Other,
net 2,990 148
(1,771 ) (934 ) 106
(3,311 ) (7,305 ) (6,986
) Earnings before income tax expense 112,448 50,445 193,226 94,930
Income tax expense 25,383 12,232
44,503 23,669 Net
earnings 87,065 38,213 148,723 71,261 Less: Net earnings
attributable to noncontrolling interests 7,283
3,411 12,861
5,494 Net earnings attributable to Skechers U.S.A.,
Inc. $ 79,782 $ 34,802 $ 135,862
$ 65,767 Net earnings per share
attributable to Skechers U.S.A., Inc.: Basic $ 1.57 $
0.69 $ 2.67 $ 1.30
Diluted $ 1.55 $ 0.68 $ 2.65
$ 1.29 Weighted average shares used in
calculating earnings per share attributable to Skechers U.S.A.,
Inc.: Basic 50,904 50,565
50,855 50,562 Diluted
51,342 50,914
51,259 50,879
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150729006269/en/
Company Contact:SKECHERS USA, Inc.David WeinbergChief Operating
Officer and Chief Financial Officer310-318-3100orInvestor
Relations:Addo CommunicationsAndrew Greenebaum310-829-5400
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