SKECHERS U.S.A., Inc. (“Skechers” or the “Company”) (NYSE:SKX), The Comfort Technology CompanyTM and a global footwear leader, today announced financial results for the third quarter ended September 30, 2021.

Third Quarter Highlights

  • Sales of $1.55 billion, a year-over-year increase of 19.2%
  • Direct-to-Consumer sales grew 44.1% and wholesale sales grew 10.5%
  • Diluted earnings per share of $0.66, a year-over-year increase of 61.0%
  • Cash, cash equivalents and investments of $1.18 billion

“Skechers achieved a new third quarter sales record surpassing $1.5 billion for the period, a remarkable achievement given the on-going supply chain disruptions,” began David Weinberg, Chief Operating Officer of Skechers. “The record quarter was the result of double-digit improvements in both our domestic and international businesses compared to the third quarter 2020, reflecting the relevancy of our product globally and a normalizing retail environment. Traffic increased in our Skechers stores, and we achieved growth of 44.1% and significantly higher gross margins in our Direct-to-Consumer business. Our Domestic and International Wholesale businesses both grew over 10%, an achievement given the global logistical challenges. The increases in International Wholesale came largely from double-digit increases in our Distributor sales, and strong performance in markets like China and India. As we look to the fourth quarter and into the first half of 2022, we believe supply chain constraints will remain a challenge, although we are beginning to see progress in key global ports, especially in Europe and other international markets. Nonetheless, we are proud of the execution of our global team to deliver our comfort technology footwear to retail stores and our partners around the world to meet the strong demand for Skechers products.”

“Comfort and technology remain at the core of who we are and why Skechers continues to be a leading global footwear brand. We offer signature comfort across the entire Skechers catalog, incorporating innovation, style and quality at a reasonable price. Supply chain constraints challenged our normal delivery speeds, but our teams worked tirelessly to move inventory as quickly as possible, delivering to our stores and partners in an effort to keep up with the demand,” stated Robert Greenberg, Chief Executive Officer of Skechers. “While we supported our business with pervasive advertising campaigns globally, we also focused on developing new product, creating what we believe is our strongest offering yet. This includes a growing seasonal collection, with styles comprised of recycled materials and building on our Fit offerings with consumers’ comfort in mind. Our accomplishments were many during the quarter—including remaining the third largest athletic footwear company in the world and achieving a new quarterly sales record for the period. That said, we believe the best is yet to come for Skechers.”

Third Quarter 2021 Financial Results

 

 

Three Months Ended

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

Change

(in millions, except per share data)

 

2021

 

 

2020

 

 

$

 

 

%

Sales

 

$

1,551.0

 

 

$

1,300.9

 

 

$

250.1

 

 

 

19.2

 

Gross profit

 

 

769.4

 

 

 

625.1

 

 

 

144.3

 

 

 

23.1

 

Gross margin

 

 

49.6

%

 

 

48.1

%

 

 

 

 

 

 

150

bps

Operating expenses

 

 

630.7

 

 

 

536.2

 

 

 

94.5

 

 

 

17.6

 

As a % of sales

 

 

40.7

%

 

 

41.2

%

 

 

 

 

 

 

(50

)bps

Earnings from operations

 

 

146.2

 

 

 

92.1

 

 

 

54.1

 

 

 

58.7

 

Operating margin

 

 

9.4

%

 

 

7.1

%

 

 

 

 

 

 

230

bps

Net earnings

 

 

103.1

 

 

 

64.3

 

 

 

38.8

 

 

 

60.3

 

Diluted earnings per share

 

$

0.66

 

 

$

0.41

 

 

$

0.25

 

 

 

61.0

 

Third quarter sales increased 19.2% as a result of a 20.1% increase in domestic sales and an 18.6% increase in international sales. Domestic and international growth was driven by increases in both direct-to-consumer and wholesale, as COVID-19 impacts continued to ease. On a constant currency basis, the Company’s total sales increased 17.1%.

Sales grew across all segments with increases to Domestic Wholesale of 10.1%, International Wholesale of 10.6%, and Direct-to-Consumer of 44.1%. Improvements in Domestic Wholesale were the result of higher unit sales volume. International Wholesale increases were driven by growth of 61.9% in Distributor sales, 10.0% in China, and 67.5% in India, partially offset by an 11.0% decline in our European subsidiaries. Direct-to-Consumer sales grew across all channels, led by domestic and international retail stores, and achieved a double-digit increase in average selling price from higher prices and lower promotions. Direct-to-Consumer comparable same store sales increased 31.0%, driven by an increase of 33.7% domestically and 25.1% internationally.

Gross margin increased 150 basis points to 49.6% driven by Direct-to-Consumer gross margin growth, resulting from higher average selling prices, partially offset by declines in International Wholesale and Domestic Wholesale, due to higher average costs per unit.

Operating expenses increased $94.5 million, or 17.6%. Selling expenses increased by $33.8 million, or 39.4%, due to higher global advertising costs. General and administrative expenses increased by $60.7 million, or 13.5%, primarily as a result of higher labor costs as well as increased rent and warehouse and distribution expenses.

Earnings from operations increased $54.1 million to $146.2 million, an increase of 58.7%.

Net earnings were $103.1 million and diluted earnings per share were $0.66.

In the third quarter, the Company’s effective income tax rate was 15.6%.

“Skechers’ double-digit growth across all segments reflects continuing strong demand for our comfort technology products,” stated John Vandemore, Chief Financial Officer of Skechers. “Despite severe global supply chain challenges, we delivered record third quarter sales along with robust gross margins and fantastic earnings growth. Further, our global infrastructure investments continued, with our China distribution center becoming fully operational and excellent progress made on many other infrastructure and technology projects. We remain confident that as supply chain constraints ease, Skechers’ will be well positioned to meet the tremendous consumer demand for our products.”

Nine Months 2021 Financial Results

 

 

Nine Months Ended

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

Change

(in millions, except per share data)

 

2021

 

 

2020

 

 

$

 

 

%

Sales

 

$

4,637.1

 

 

$

3,272.7

 

 

$

1,364.4

 

 

 

41.7

 

Gross profit

 

 

2,298.6

 

 

 

1,541.4

 

 

 

757.2

 

 

 

49.1

 

Gross margin

 

 

49.6

%

 

 

47.1

%

 

 

 

 

 

 

250

bps

Operating expenses

 

 

1,811.1

 

 

 

1,476.5

 

 

 

334.6

 

 

 

22.7

 

As a % of sales

 

 

39.1

%

 

 

45.1

%

 

 

 

 

 

 

(600

) bps

Earnings from operations

 

 

505.1

 

 

 

76.0

 

 

 

429.1

 

 

 

564.6

 

Operating margin

 

 

10.9

%

 

 

2.3

%

 

 

 

 

 

 

860

bps

Net earnings

 

 

339.1

 

 

 

45.3

 

 

 

293.8

 

 

 

648.6

 

Diluted earnings per share

 

$

2.17

 

 

$

0.29

 

 

$

1.88

 

 

 

648.3

 

Year-to-date sales increased 41.7% reflecting a 42.4% increase in domestic sales and a 41.2% increase in international sales with the largest contribution derived from International Wholesale growth. On a constant currency basis, the Company’s total sales increased 37.4%.

Sales grew across all segments with increases to Domestic Wholesale of 36.0%, International Wholesale of 35.6%, and Direct-to-Consumer of 58.9%. Improvements in Domestic Wholesale were the result of higher unit sales volume. International Wholesale had growth in China of 52.6% and Europe of 16.1%. Direct-to-Consumer had higher units sold and higher average selling prices. Direct-to-Consumer comparable same store sales increased 45.0%, driven by an increase of 49.4% domestically and 33.4% internationally.

Gross margin increased 250 basis points to 49.6% primarily driven by increased gross margins in the Direct-to-Consumer segment, which was the result of increased average selling prices and reduced promotional activity.

Operating expenses increased by $334.6 million or 22.7%. Selling expenses increased by $117.3 million or 53.3%, primarily due to higher global advertising costs. General and administrative expenses increased by $217.3 million or 17.3%, primarily due to higher labor and incentive compensation costs, global warehouse and distribution expenses, and rent.

Earnings from operations increased $429.1 million to $505.1 million.

Net earnings were $339.1 million and diluted earnings per share were $2.17.

The Company’s effective income tax rate was 19.0%.

Balance Sheet

Cash, cash equivalents and investments totaled $1.18 billion, a decrease of $398.3 million, or 25.2% from December 31, 2020 primarily as a result of repaying $452.5 million on our revolving credit facility in the second quarter of 2021.

Total inventory was $1.23 billion, an increase of $213.6 million or 21.0% from December 31, 2020. Increased inventory levels primarily reflect growth in the International Wholesale segment and higher merchandise in transit due to supply chain challenges with shipping and port delays.

Outlook

For the fiscal year 2021, the Company believes it will achieve sales between $6.15 billion and $6.20 billion and diluted earnings per share of between $2.45 and $2.50. Further, the Company believes that for the fourth quarter of 2021, it will achieve sales between $1.51 billion and $1.56 billion and diluted earnings per share of between $0.28 and $0.33.

Store Count

 

 

Number of Store Locations as of

 

 

 

 

 

 

 

 

 

 

 

Number of Store Locations as of

 

 

December 31, 2020

 

 

Opened

 

 

Closed(1)

 

 

 

September 30, 2021

Domestic stores

 

 

523

 

 

 

16

 

 

 

(23

)

 

 

 

516

International stores

 

 

331

 

 

 

19

 

 

 

(6

)

 

 

 

344

Joint venture stores

 

 

467

 

 

 

102

 

 

 

(77

)

 

 

 

492

Distributor, licensee and franchise stores

 

 

2,570

 

 

 

422

 

 

 

(174

)

 

 

 

2,818

Total Skechers stores

 

 

3,891

 

 

 

559

 

 

 

(280

)  

 

 

4,170

(1)

Does not reflect temporary closures due to the COVID-19 pandemic.

Third Quarter 2021 Conference Call

The Company will host a conference call today at 4:30 p.m. ET / 1:30 p.m. PT to discuss its third quarter 2021 financial results. The call can be accessed on the Investor Relations section of the Company’s website at investors.skechers.com. For those unable to participate during the live broadcast, a replay will be available beginning October 28, 2021 at 7:30 p.m. ET, through November 11, 2021, at 11:59 p.m. ET. To access the replay, dial 844-512-2921 (U.S.) or 412-317-6671 (International) and use passcode: 13723310.

About SKECHERS U.S.A., Inc.

Skechers, The Comfort Technology Company based in Southern California, designs, develops and markets a diverse range of lifestyle and performance footwear, apparel and accessories for men, women and children. The Company’s collections are available in the United States and over 170 countries and territories via department and specialty stores, and direct to consumers through 4,170 Company and third-party-owned retail stores and e-commerce websites. The Company manages its international business through a network of global distributors, joint venture partners in Asia, Israel and Mexico, and wholly-owned subsidiaries in Canada, Japan, India, Europe and Latin America. For more information, please visit about.skechers.com and follow us on Facebook, Instagram, Twitter, and TikTok.

Reference in this press release to “Sales” refers to Skechers’ net sales reported under GAAP. This announcement contains forward-looking statements that are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may include, without limitation, Skechers’ future domestic and international growth, financial results and operations including expected net sales and earnings, its development of new products, future demand for its products, its planned domestic and international expansion, opening of new stores and additional expenditures, and advertising and marketing initiatives. 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 the disruption of business and operations due to the COVID-19 pandemic; delays or disruptions in our supply chain; international economic, political and market conditions including the challenging consumer retail markets in the United States; 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, especially in the highly competitive performance footwear market; 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 Skechers’ annual report on Form 10-K for the year ended December 31, 2020 and its quarterly report on Form 10-Q for the six months ended June 30, 2021. More specifically, the COVID-19 pandemic has had and may continue to have a significant impact on Skechers’ business, financial conditions, cash flow and results of operations. Forward-looking statements with respect to the COVID-19 pandemic include, without limitation, Skechers’ plans in response to this pandemic. At this time, there is significant uncertainty about the COVID-19 pandemic, including without limitation, (i) the duration and extent of the impact of the pandemic, (ii) governmental responses to the pandemic, including how such responses could impact Skechers’ business and operations, as well as the operations of its factories and other business partners, (iii) the effectiveness of Skechers’ actions taken in response to these risks, and (iv) Skechers’ ability to effectively and timely adjust its plans in response to the rapidly changing retail and economic environment. Taking these and other risk factors associated with the COVID-19 pandemic into consideration, the dynamic nature of these circumstances means that what is stated in this press release could change at any time, and as a result, actual results could differ materially from those contemplated by such forward-looking statements. The risks included here are not exhaustive. Skechers operates in a very competitive and rapidly changing environment. New risks emerge from time to time and we cannot predict all such risk factors, nor can we assess the impact of all such risk factors on our business 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)

 

 

 

As of September 30,

 

 

As of December 31,

 

(in thousands)

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

952,076

 

 

$

1,370,826

 

Short-term investments

 

 

90,577

 

 

 

100,767

 

Trade accounts receivable, net

 

 

758,713

 

 

 

619,800

 

Other receivables

 

 

81,362

 

 

 

69,222

 

Total receivables

 

 

840,075

 

 

 

689,022

 

Inventory

 

 

1,230,349

 

 

 

1,016,774

 

Prepaid expenses and other current assets

 

 

189,598

 

 

 

166,962

 

Total current assets

 

 

3,302,675

 

 

 

3,344,351

 

Property, plant and equipment, net

 

 

1,087,183

 

 

 

935,441

 

Operating lease right-of-use assets

 

 

1,130,279

 

 

 

1,171,521

 

Deferred tax assets

 

 

70,353

 

 

 

63,884

 

Long-term investments

 

 

139,052

 

 

 

108,412

 

Goodwill

 

 

93,497

 

 

 

93,497

 

Other assets, net

 

 

78,536

 

 

 

95,263

 

Total non-current assets

 

 

2,598,900

 

 

 

2,468,018

 

TOTAL ASSETS

 

$

5,901,575

 

 

$

5,812,369

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

 

 

Accounts payable

 

$

846,101

 

 

$

744,077

 

Operating lease liabilities

 

 

214,192

 

 

 

204,370

 

Accrued expenses

 

 

232,599

 

 

 

208,712

 

Current installments of long-term borrowings

 

 

43,742

 

 

 

52,250

 

Short-term borrowings

 

 

320

 

 

 

3,297

 

Total current liabilities

 

 

1,336,954

 

 

 

1,212,706

 

Long-term borrowings, excluding current installments

 

 

282,760

 

 

 

679,415

 

Long-term operating lease liabilities

 

 

1,010,499

 

 

 

1,065,069

 

Deferred tax liabilities

 

 

9,850

 

 

 

11,439

 

Other long-term liabilities

 

 

129,518

 

 

 

118,077

 

Total non-current liabilities

 

 

1,432,627

 

 

 

1,874,000

 

Total liabilities

 

 

2,769,581

 

 

 

3,086,706

 

Stockholders’ equity

 

 

 

 

 

 

 

 

Preferred Stock

 

 

 

 

 

 

Class A Common Stock

 

 

135

 

 

 

134

 

Class B Common Stock

 

 

21

 

 

 

21

 

Additional paid-in capital

 

 

410,376

 

 

 

372,165

 

Accumulated other comprehensive loss

 

 

(44,510

)

 

 

(27,285

)

Retained earnings

 

 

2,475,481

 

 

 

2,136,400

 

Skechers U.S.A., Inc. equity

 

 

2,841,503

 

 

 

2,481,435

 

Noncontrolling interests

 

 

290,491

 

 

 

244,228

 

Total stockholders' equity

 

 

3,131,994

 

 

 

2,725,663

 

TOTAL LIABILITIES AND EQUITY

 

$

5,901,575

 

 

$

5,812,369

 

SKECHERS U.S.A., INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS

(Unaudited)

 

 

 

 

 

 

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

(in thousands, except per share data)

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Sales

 

$

1,550,957

 

 

$

1,300,886

 

 

$

4,637,147

 

 

$

3,272,703

 

Cost of sales

 

 

781,513

 

 

 

675,765

 

 

 

2,338,587

 

 

 

1,731,349

 

Gross profit

 

 

769,444

 

 

 

625,121

 

 

 

2,298,560

 

 

 

1,541,354

 

Royalty income

 

 

7,519

 

 

 

3,216

 

 

 

17,654

 

 

 

11,061

 

 

 

 

776,963

 

 

 

628,337

 

 

 

2,316,214

 

 

 

1,552,415

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling

 

 

119,775

 

 

 

85,926

 

 

 

337,519

 

 

 

220,222

 

General and administrative

 

 

510,941

 

 

 

450,285

 

 

 

1,473,570

 

 

 

1,256,228

 

Total operating expenses

 

 

630,716

 

 

 

536,211

 

 

 

1,811,089

 

 

 

1,476,450

 

Earnings from operations

 

 

146,247

 

 

 

92,126

 

 

 

505,125

 

 

 

75,965

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

813

 

 

 

1,884

 

 

 

2,518

 

 

 

5,739

 

Interest expense

 

 

(3,348

)

 

 

(4,643

)

 

 

(10,878

)

 

 

(11,428

)

Other, net

 

 

(5,514

)

 

 

7,726

 

 

 

(11,705

)

 

 

15,882

 

Total other income (expense)

 

 

(8,049

)

 

 

4,967

 

 

 

(20,065

)

 

 

10,193

 

Earnings before income taxes

 

 

138,198

 

 

 

97,093

 

 

 

485,060

 

 

 

86,158

 

Income tax expense

 

 

21,497

 

 

 

14,983

 

 

 

92,027

 

 

 

18,104

 

Net earnings

 

 

116,701

 

 

 

82,110

 

 

 

393,033

 

 

 

68,054

 

Less: Net earnings attributable to noncontrolling interest

 

 

13,562

 

 

 

17,832

 

 

 

53,952

 

 

 

22,771

 

Net earnings attributable to Skechers U.S.A. Inc.

 

$

103,139

 

 

$

64,278

 

 

$

339,081

 

 

$

45,283

 

Net earnings per share attributable to Skechers U.S.A. Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.66

 

 

$

0.42

 

 

$

2.18

 

 

$

0.29

 

Diluted

 

$

0.66

 

 

$

0.41

 

 

$

2.17

 

 

$

0.29

 

Weighted-average shares used in calculating net earnings per share attributable to Skechers U.S.A. Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

155,835

 

 

 

154,462

 

 

 

155,413

 

 

 

154,061

 

Diluted

 

 

157,123

 

 

 

154,980

 

 

 

156,590

 

 

 

154,707

 

SKECHERS U.S.A., INC. AND SUBSIDIARIES

SUPPLEMENTAL FINANCIAL INFORMATION

(Unaudited)

 

 

 

 

 

 

 

 

Three Months Ended September 30,

 

 

Change

(in millions)

 

2021

 

 

2020

 

 

$

 

 

%

Domestic Wholesale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

350.7

 

 

$

318.4

 

 

 

32.3

 

 

 

10.1

 

Gross margin

 

 

36.0

%

 

 

38.7

%

 

 

 

 

 

 

(270

) bps

International Wholesale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

711.9

 

 

$

643.4

 

 

 

68.5

 

 

 

10.6

 

Gross margin

 

 

44.9

%

 

 

45.9

%

 

 

 

 

 

 

(100

) bps

Direct-to-Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

488.4

 

 

$

339.1

 

 

 

149.3

 

 

 

44.1

 

Gross margin

 

 

66.3

%

 

 

60.9

%

 

 

 

 

 

 

540

bps

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

1,551.0

 

 

$

1,300.9

 

 

 

250.1

 

 

 

19.2

 

Gross margin

 

 

49.6

%

 

 

48.1

%

 

 

 

 

 

 

150

bps

 

 

Nine Months Ended September 30,

 

 

Change

 

(in millions)

 

2021

 

 

2020

 

 

$

 

 

%

 

Domestic Wholesale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

1,125.0

 

 

$

827.1

 

 

 

297.9

 

 

 

36.0

 

Gross margin

 

 

37.5

%

 

 

38.5

%

 

 

 

 

 

 

(100)

bps

International Wholesale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

2,174.2

 

 

$

1,603.8

 

 

 

570.4

 

 

 

35.6

 

Gross margin

 

 

45.5

%

 

 

44.7

%

 

 

 

 

 

 

80

bps

Direct-to-Consumer

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

1,337.9

 

 

$

841.8

 

 

 

496.1

 

 

 

58.9

 

Gross margin

 

 

66.4

%

 

 

60.1

%

 

 

 

 

 

 

630

bps

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales

 

$

4,637.1

 

 

$

3,272.7

 

 

 

1,364.4

 

 

 

41.7

 

Gross margin

 

 

49.6

%

 

 

47.1

%

 

 

 

 

 

 

250

bps

SKECHERS U.S.A., INC. AND SUBSIDIARIES RECONCILIATION OF GAAP EARNINGS FINANCIAL MEASURES TO CORRESPONDING NON-GAAP FINANCIAL MEASURES (Unaudited)

Constant Currency Adjustment

We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of period-over-period fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, thereby facilitating period-to-period comparisons of our business performance and is consistent with how management evaluates the Company’s performance. We calculate constant currency percentages by converting our current period local currency financial results using the prior-period exchange rates and comparing these adjusted amounts to our prior period reported results.

 

 

Three Months Ended September 30,

 

 

 

2021

 

 

2020

Change

 

(in millions,

except per share data)

 

Reported GAAP Measure

 

 

Constant Currency

Adjustment

 

 

Adjusted for Non-GAAP Measures

 

 

Reported GAAP Measure

 

 

$

 

 

%

 

Sales

 

$

1,551.0

 

 

$

(28.1

)

 

$

1,522.9

 

 

$

1,300.9

 

 

 

222.0

 

 

 

17.1

 

Cost of sales

 

 

781.6

 

 

 

(15.4

)

 

 

766.2

 

 

 

675.8

 

 

 

90.4

 

 

 

13.4

 

Gross profit

 

$

769.4

 

 

$

(12.7

)

 

$

756.7

 

 

$

625.1

 

 

 

131.6

 

 

 

21.1

 

Royalty income

 

 

7.5

 

 

 

(0.3

)

 

 

7.2

 

 

 

3.2

 

 

 

4.0

 

 

 

125.0

 

Operating expenses

 

 

630.7

 

 

 

(9.4

)

 

 

621.3

 

 

 

536.2

 

 

 

85.1

 

 

 

15.9

 

Earnings from operations

 

$

146.2

 

 

$

(3.6

)

 

$

142.6

 

 

$

92.1

 

 

 

50.5

 

 

 

54.8

 

Other income (expense)

 

 

(8.0

)

 

 

6.0

 

 

 

(2.0

)

 

 

5.0

 

 

 

(7.0

)

 

 

(140.0

)

Income tax expense

 

 

21.5

 

 

 

(0.7

)

 

 

20.8

 

 

 

15.0

 

 

 

5.8

 

 

 

38.7

 

Less: Noncontrolling interests

 

 

13.6

 

 

 

(1.0

)

 

 

12.6

 

 

 

17.8

 

 

 

(5.2

)

 

 

(29.2

)

Net earnings

 

$

103.1

 

 

$

4.1

 

 

$

107.2

 

 

$

64.3

 

 

 

42.9

 

 

 

66.7

 

Diluted earnings per share

 

$

0.66

 

 

$

0.02

 

 

$

0.68

 

 

$

0.41

 

 

 

0.27

 

 

 

65.9

 

 

 

Nine Months Ended September 30,

 

 

 

2021

 

 

2020

Change

 

(in millions,

except per share data)

 

Reported GAAP Measure

 

 

Constant Currency

Adjustment

 

 

Adjusted for Non-GAAP Measures

 

 

Reported GAAP Measure

 

 

$

 

 

%

 

Sales

 

$

4,637.1

 

 

$

(139.6

)

 

$

4,497.5

 

 

$

3,272.7

 

 

 

1,224.8

 

 

 

37.4

 

Cost of sales

 

 

2,338.5

 

 

 

(77.1

)

 

 

2,261.4

 

 

 

1,731.3

 

 

 

530.1

 

 

 

30.6

 

Gross profit

 

$

2,298.6

 

 

$

(62.5

)

 

$

2,236.1

 

 

$

1,541.4

 

 

 

694.7

 

 

 

45.1

 

Royalty income

 

 

17.6

 

 

 

(1.1

)

 

 

16.5

 

 

 

11.1

 

 

 

5.4

 

 

 

48.6

 

Operating expenses

 

 

1,811.1

 

 

 

(43.0

)

 

 

1,768.1

 

 

 

1,476.5

 

 

 

291.6

 

 

 

19.7

 

Earnings from operations

 

$

505.1

 

 

$

(20.6

)

 

$

484.5

 

 

$

76.0

 

 

 

408.5

 

 

 

537.5

 

Other income (expense)

 

 

(20.0

)

 

 

11.7

 

 

 

(8.3

)

 

 

10.2

 

 

 

(18.5

)

 

 

(181.4

)

Income tax expense

 

 

92.0

 

 

 

(3.1

)

 

 

88.9

 

 

 

18.1

 

 

 

70.8

 

 

 

391.2

 

Less: Noncontrolling interests

 

 

54.0

 

 

 

(4.5

)

 

 

49.5

 

 

 

22.8

 

 

 

26.7

 

 

 

117.1

 

Net earnings

 

$

339.1

 

 

$

(1.3

)

 

$

337.8

 

 

$

45.3

 

 

 

292.5

 

 

 

645.7

 

Diluted earnings per share

 

$

2.17

 

 

$

(0.01

)

 

$

2.16

 

 

$

0.29

 

 

 

1.87

 

 

 

644.8

 

 

Investor Relations: Andrew Greenebaum Addo Investor Relations investors@skx.com

Press: Jennifer Clay Vice President, Corporate Communications Skechers U.S.A., Inc. (310) 318-3100

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