- Second Quarter Net Income $7.6 Million, or $0.43 Per Diluted
Share - LONG ISLAND CITY, N.Y., Aug. 5 /PRNewswire-FirstCall/ --
Steven Madden, Ltd. (NASDAQ:SHOO), a leading designer, wholesaler
and marketer of fashion footwear and accessories for women, men and
children, today announced financial results for the second quarter
ended June 30, 2008. Second quarter net sales were $109.3 million
compared to $108.3 million in the second quarter of 2007. Gross
margin decreased slightly to 41.7% compared to 42.0% in the second
quarter of the prior year due to a margin decline in the retail
division, which was partially offset by a margin increase in the
wholesale division. Operating expenses as a percent of sales were
33.5% versus 31.0% in the same period of 2007, due primarily to
increased expenses in the retail division for new stores, the
write-off of fixed assets related to store closures and remodels,
and severance. Operating income was $12.1 million, or 11.1% of
sales, compared with operating income of $17.5 million, or 16.2% of
sales, in the second quarter of 2007. This decline was due
primarily to higher operating expenses as a percent of sales and a
decline in commission income from the private label business versus
the prior year period. Net income was $7.6 million, or $0.43 per
diluted share, compared to $10.5 million, or $0.49 per diluted
share, in the prior year's second quarter. Revenues from the
wholesale business were $79.4 million compared to $78.6 million in
the second quarter of 2007 due primarily to the strength of the
Madden Girl and Daniel M. Friedman divisions, which offset relative
softness in the Steve Madden Women's and Steve Madden Men's
divisions during the quarter. Gross margin in the wholesale
business increased to 34.7% from 34.2% in last year's second
quarter as a result of margin improvement in both the wholesale
footwear and Daniel M. Friedman accessories divisions. Retail
revenues were $29.9 million compared to $29.6 million in the second
quarter of the prior year due to sales from new stores. Same store
sales decreased 3.3%. Retail gross margin decreased to 60.3% from
62.4% in the comparable period of the prior year, due primarily to
increased promotional activity due to the challenging retail
environment. During the second quarter of 2008, the Company closed
two stores. For the first six months of fiscal 2008, net sales were
$209.9 million compared to $214.9 million in the comparable period
last year. Net income totaled $9.7 million, or $0.51 per diluted
share, for the first six months of fiscal 2008, compared to $20.1
million, or $0.92 per diluted share, in the comparable period last
year. Excluding a one-time after-tax charge of $3.0 million in
first quarter resulting from the resignation of the Company's
former Chief Executive Officer, net income totaled $12.7 million,
or $0.67 per diluted share, for the first six months of fiscal
2008. Edward Rosenfeld, Interim Chief Executive Officer, stated,
"In wholesale, Madden Girl and Daniel M. Friedman were bright spots
as we generated strong sales increases in these two divisions in
the second quarter. We also remain pleased with our wholesale gross
margin, which rose modestly and reflects positive trends in both
footwear and accessories. While we continue to experience the
effects of the challenging macroeconomic environment, we are
beginning to see some renewed momentum in our business. We are
experiencing a positive response to our merchandise from both our
wholesale customers and consumers, and we are encouraged by
emerging footwear trends and the current sell-through of our
product." Arvind Dharia, Chief Financial Officer, commented, "We
are pleased with our ability to maintain a strong financial
position despite the challenging macroeconomic environment. Our
balance sheet continues to demonstrate the Company's strength as we
ended the quarter with $46.3 million in cash, cash equivalents, and
marketable securities, no debt, and total stockholders' equity of
$184.0 million. We remain confident the Company is well positioned
for long-term growth." Company Outlook Based on trends to date this
year and current visibility, the Company is maintaining its
guidance for the full fiscal year. The Company continues to expect
2008 net sales will be flat to an increase of 2% compared to fiscal
2007 and earnings per diluted share will range between $1.55 and
$1.65, excluding the previously mentioned impact of the one-time
charge recognized in first quarter. Including the impact of the
one-time charge, earnings per diluted share are expected to range
between $1.39 and $1.49. Mr. Rosenfeld concluded, "While we are
maintaining a conservative approach to managing our business this
year due to the challenging retail environment, we are encouraged
by our recent performance and believe we are well-positioned as we
move into the latter half of fiscal 2008. The Company has a solid
foundation for long-term success based on the increasing
diversification of our business, the strength of our design team
and our strong focus on execution." Conference Call Information
Interested shareholders are invited to listen to the second quarter
earnings conference call scheduled for today, Tuesday, August 5,
2008, at 10 a.m. Eastern Time. The call will be broadcast live over
the Internet and can be accessed by logging onto
http://www.stevemadden.com/. An online archive of the broadcast
will be available within one hour of the conclusion of the call and
will be accessible until August 19, 2008. Additionally, a replay of
the call can be accessed by dialing 800-642-1687, passcode
56721800, and will be available until August 12, 2008. Steven
Madden, Ltd. designs and markets fashion-forward footwear and
accessories for women, men and children. The shoes and accessories
are sold through company-owned retail stores, department stores,
apparel and footwear specialty stores, and online at
http://www.stevemadden.com/. The Company has several licensees for
its brands, including for outerwear, cold weather accessories,
eyewear, and hosiery and owns and operates 99 retail stores,
including its online store. Through its wholly-owned subsidiary,
Daniel M. Friedman & Associates, the Company is the licensee
for handbags and belts for Betsey Johnson, Daisy Fuentes and Tracy
Reese. Statements in this press release that are not statements of
historical or current fact constitute "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown
risks, uncertainties and other unknown factors that could cause the
actual results of the Company to be materially different from the
historical results or from any future results expressed or implied
by such forward-looking statements. In addition to statements which
explicitly describe such risks and uncertainties readers are urged
to consider statements labeled with the terms "believes", "belief",
"expects", "intends", "anticipates" or "plans" to be uncertain and
forward-looking. The forward looking statements contained herein
are also subject generally to other risks and uncertainties that
are described from time to time in the Company's reports and
registration statements filed with the Securities and Exchange
Commission. STEVEN MADDEN LTD CONSOLIDATED STATEMENT OF OPERATIONS
(In thousands, except per share data) - Unaudited Three Months
Ended Six Months Ended Consolidated: Jun 30, Jun 30, Jun 30, Jun
30, 2008 2007 2008 2007 Net Sales $109,317 $108,256 $209,856
$214,910 Cost of Sales 63,780 62,836 124,104 127,296 Gross Profit
45,537 45,420 85,752 87,614 Commission and licensing fee income
3,203 5,669 6,559 11,115 Operating Expenses 36,593 33,599 77,327
65,570 Income from Operations 12,147 17,490 14,984 33,159 Interest
and other Income, Net 368 803 894 1,713 Income Before provision for
Income Taxes 12,515 18,293 15,878 34,872 Provision for Income Tax
4,881 7,775 6,192 14,821 Net Income $7,634 $10,518 $9,686 $20,051
Basic income per share $0.43 $0.51 $0.51 $0.96 Diluted income per
share $0.43 $0.49 $0.51 $0.92 Weighted average common shares
outstanding - Basic 17,662 20,659 18,839 20,809 Weighted average
common shares outstanding - Diluted 17,810 21,626 19,023 21,793
BALANCE SHEET HIGHLIGHTS Jun 30, Dec 31, Jun 30, 2008 2007 2007
Consolidated Consolidated Consolidated (Unaudited) (Unaudited) Cash
and cash equivalents $18,849 $29,446 $23,933 Investment Securities
27,462 80,411 69,973 Total Current Assets 158,198 168,855 195,875
Total Assets 227,498 266,521 266,670 Total Current Liabilities
38,968 47,717 36,524 Total Stockholder Equity 184,032 215,334
226,839 DATASOURCE: Steven Madden, Ltd. CONTACT: Investors: Cara
O'Brien, or Leigh Parrish, Media: Diane Zappas, all of FD, for
Steven Madden, Ltd., +1-212-850-5600 Web site:
http://www.stevemadden.com/
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