Wolverine World Wide, Inc. (NYSE: WWW) today reported strong
financial results for the third quarter ended October 2, 2021, and
updated its 2021 fiscal-year revenue and earnings outlook to
reflect recent supply chain challenges.
“The Company delivered strong double-digit revenue growth and
exceptional earnings leverage, despite the increased supply chain
disruption caused by Vietnam factory closures and global logistics
delays” said Blake W. Krueger, Wolverine Worldwide’s Chairman and
Chief Executive Officer. “Merrell was hit hardest by Vietnam
factory closures but still delivered mid-single-digit growth.
Saucony and Sperry both drove over 40% revenue growth. The
unplanned supply chain disruptions resulted in at least a $60
million negative revenue impact in Q3. Demand for our brands
remains very strong as evidenced by continued strength in
sell-through trends at retail and a robust order book that extends
into Q3 2022. We remain bullish on our outlook for the future in
light of these trends and the composition of our portfolio which
over-indexes on performance categories like hiking, running, and
work. We are also excited about the addition of Sweaty Betty to our
portfolio – a fast-growing brand that enhances the digital and
apparel capabilities of the Company.”
THIRD-QUARTER 2021 PERFORMANCE On August 2, 2021,
Wolverine Worldwide acquired women’s activewear brand Sweaty Betty,
a digitally-native, premium global apparel brand, which is expected
to fuel growth and enhance the Company’s fast-growing eCommerce
business. The following third-quarter results include Sweaty Betty
during the period from August 2, 2021 until the end of the
quarter.
- Reported revenue was $636.7 million, up 29.1% versus the prior
year. On a constant currency basis, revenue was up 28.2% versus the
prior year.
- eCommerce reported revenue was up 45% versus the prior year and
up 126% versus 2019.
- Reported gross margin was 43.2%, compared to 41.0% in the prior
year. Adjusted gross margin was 44.6%, compared to 41.3% in the
prior year.
- Reported operating margin was 6.7%, compared to 8.6% in the
prior year. Adjusted operating margin was 12.0%, compared to 10.6%
in the prior year.
- Reported diluted earnings per share were $0.00, compared to
reported diluted earnings per share of $0.27 in the prior year.
Current year reported earnings includes costs related to the
acquisition of Sweaty Betty, debt refinancing costs, certain
litigation-related costs and air freight charges related to
production and shipping delays caused by the COVID-19 pandemic.
Adjusted diluted earnings per share were $0.62, and, on a constant
currency basis, were $0.61, compared to $0.35 in the prior
year.
- Inventory at the end of the quarter was $412.0 million, up
26.5% versus the prior year. Sweaty Betty contributed 16.1% to the
increase versus the prior year.
- Total debt at the end of the quarter was $1,024.4 million, or
$147.8 million more than in the prior year. Total liquidity
considering the October credit facility transaction was
approximately $800 million.
THIRD-QUARTER 2021 UNDERLYING PERFORMANCE (excludes Sweaty
Betty)
- Underlying revenue was $597.6 million, up 21.2% versus the
prior year and 4.0% versus 2019.
- eCommerce underlying revenue was up 13.3% versus the prior year
and up 77.3% versus 2019.
- Adjusted underlying gross margin was 43.2%, compared to 41.3%
in the prior year.
- Adjusted underlying operating margin was 12.5%, compared to
10.6% in the prior year.
- Adjusted underlying diluted earnings per share were $0.60,
compared to $0.35 in the prior year.
“We are pleased with the third quarter’s strong double-digit
revenue growth and even stronger adjusted earnings growth versus
2020,” said Mike Stornant, Senior Vice President and Chief
Financial Officer. “Operating margin was stronger than expected and
benefited from healthy gross margin performance across the
portfolio. In addition, our nimble operating model and diverse
portfolio allowed us to navigate the short-term disruption caused
by Vietnam factory closures. We are encouraged to see factories
re-open but the recent closures will impact our ability to fully
service the incredibly strong demand we are seeing in Q4. As a
result, we adjusted our full-year outlook for fiscal 2021.”
FULL-YEAR 2021 OUTLOOK For the full 2021 fiscal year, the
Company now expects revenue of approximately $2.4 billion resulting
in nearly 35% growth versus the prior year. This revenue outlook
represents mid-single-digit growth over 2019 (including Sweaty
Betty), and low-single-digit growth excluding Sweaty Betty.
Reported diluted earnings per share are now expected to be in the
range of $1.16 to $1.21, and adjusted diluted earnings per share
are now expected to be in the range of $2.05 to $2.10.
This outlook assumes no meaningful deterioration of current
market conditions related to the COVID-19 pandemic during the
remainder of 2021.
NON-GAAP FINANCIAL MEASURES Measures referred to in this
release as “adjusted” financial results are non-GAAP measures that
exclude environmental and other related costs net of recoveries,
costs related to the COVID-19 pandemic including air freight costs,
credit loss expenses, severance expenses and other related costs,
reorganization expenses and debt extinguishment costs. Measures
referred to in this release as “underlying” financial results are
non-GAAP measures that exclude the results of Sweaty Betty. The
Company also presents constant currency information, which is a
non-GAAP measure that excludes the impact of fluctuations in
foreign currency exchange rates. The Company calculates constant
currency basis by converting the current-period local currency
financial results using the prior period exchange rates and
comparing these adjusted amounts to the Company's current period
reported results. The Company believes providing each of these
non-GAAP measures provides valuable supplemental information
regarding its results of operations, consistent with how the
Company evaluates performance.
The Company has provided a reconciliation of each of the above
non-GAAP financial measures to the most directly comparable GAAP
financial measure. The Company believes these non-GAAP measures
provide useful information to both management and investors because
they increase the comparability of current period results to prior
period results by adjusting for certain items that may not be
indicative of core operating results and enable better
identification of trends in our business. The adjusted financial
results are used by management to, and allow investors to, evaluate
the operating performance of the Company on a comparable basis. The
underlying financial results are used by management to, and allow
investors to, evaluate the aggregate operating performance of the
Company’s brands other than Sweaty Betty. Management does not, nor
should investors, consider such non-GAAP financial measures in
isolation from, or as a substitute for, financial information
prepared in accordance with GAAP.
EARNINGS CALL INFORMATION The Company will host a
conference call today at 8:30 a.m. EST to discuss these results and
current business trends. The conference call will be broadcast live
and accessible under the “Investor Relations” tab at
www.wolverineworldwide.com. A replay of the conference call will be
available on the Company’s website for a period of approximately 30
days.
ABOUT WOLVERINE WORLDWIDE Founded in 1883 on the belief
in the possibility of opportunity, Wolverine World Wide, Inc.
(NYSE:WWW) is one of the world’s leading marketers and licensors of
branded casual, active lifestyle, work, outdoor sport, athletic,
children's and uniform footwear and apparel. Through a diverse
portfolio of highly recognized brands, our products are designed to
empower, engage and inspire our consumers every step of the way.
The company’s portfolio includes Merrell®, Saucony®, Sweaty Betty®
Sperry®, Hush Puppies®, Wolverine®, Keds®, Chaco®, Bates®, HYTEST®,
and Stride Rite®. Wolverine Worldwide is also the global footwear
licensee of the popular brands Cat® and Harley-Davidson®. Based in
Rockford, Michigan, for more than 130 years, the company's products
are carried by leading retailers in the U.S. and globally in
approximately 170 countries and territories. For additional
information, please visit our website, www.wolverineworldwide.com
or visit us on Facebook, LinkedIn, and Instagram.
FORWARD-LOOKING STATEMENTS This press release contains
forward-looking statements, including statements regarding the
Company’s expectations regarding: its outlook for fiscal year 2021
revenue, and reported and adjusted earnings per share and future
growth.. In addition, words such as “estimates,” “anticipates,”
“believes,” “forecasts,” “step,” “plans,” “predicts,” “focused,”
“projects,” “outlook,” “is likely,” “expects,” “intends,” “should,”
“will,” “confident,” variations of such words, and similar
expressions are intended to identify forward-looking statements.
These statements are not guarantees of future performance and
involve certain risks, uncertainties, and assumptions (“Risk
Factors”) that are difficult to predict with regard to timing,
extent, likelihood, and degree of occurrence. Risk Factors include,
among others: the effects of the COVID-19 pandemic on the Company’s
business, operations, financial results and liquidity, including
the duration and magnitude of such effects, which will depend on
numerous evolving factors that the Company cannot currently
accurately predict or assess, including: the duration and scope of
the pandemic; the negative impact on global and regional markets,
economies and economic activity, including the duration and
magnitude of its impact on unemployment rates, consumer
discretionary spending and levels of consumer confidence; actions
governments, businesses and individuals take in response to the
pandemic; the effects of the pandemic, including all of the
foregoing, on the Company’s distributors, manufacturers, suppliers,
joint venture partners, wholesale customers and other
counterparties, and how quickly economies and demand for the
Company’s products recover after the pandemic subsides; changes in
general economic conditions, employment rates, business conditions,
interest rates, tax policies and other factors affecting consumer
spending in the markets and regions in which the Company’s products
are sold; the inability for any reason to effectively compete in
global footwear, apparel and consumer-direct markets; the inability
to maintain positive brand images and anticipate, understand and
respond to changing footwear and apparel trends and consumer
preferences; the inability to effectively manage inventory levels;
increases or changes in duties, tariffs, quotas or applicable
assessments in countries of import and export; foreign currency
exchange rate fluctuations; currency restrictions; supply chain or
other capacity constraints, production disruptions, quality issues,
price increases or other risks associated with foreign sourcing;
the cost and availability of raw materials, inventories, services
and labor for contract manufacturers; labor disruptions; changes in
relationships with, including the loss of, significant wholesale
customers; risks related to the significant investment in, and
performance of, the Company’s consumer-direct operations; risks
related to expansion into new markets and complementary product
categories; the impact of seasonality and unpredictable weather
conditions; changes in general economic conditions and/or the
credit markets on the Company’s distributors, suppliers and
retailers; increases in the Company’s effective tax rates; failure
of licensees or distributors to meet planned annual sales goals or
to make timely payments to the Company; the risks of doing business
in developing countries, and politically or economically volatile
areas; the ability to secure and protect owned intellectual
property or use licensed intellectual property; the impact of
regulation, regulatory and legal proceedings and legal compliance
risks, including compliance with federal, state and local laws and
regulations relating to the protection of the environment,
environmental remediation and other related costs, and litigation
or other legal proceedings relating to the protection of the
environment or environmental effects on human health; the potential
breach of the Company’s databases or other systems, or those of its
vendors, which contain certain personal information, payment card
data or proprietary information, due to cyberattack or other
similar events; problems affecting the Company’s supply chain or
distribution system, including service interruptions at shipping
and receiving ports; strategic actions, including new initiatives
and ventures, acquisitions and dispositions, and the Company’s
success in integrating acquired businesses, and implementing new
initiatives and ventures; the risk of impairment to goodwill and
other intangibles; changes in future pension funding requirements
and pension expenses; and additional factors discussed in the
Company’s reports filed with the Securities and Exchange Commission
and exhibits thereto. The foregoing Risk Factors, as well as other
existing Risk Factors and new Risk Factors that emerge from time to
time, may cause actual results to differ materially from those
contained in any forward-looking statements. Given these or other
risks and uncertainties, investors should not place undue reliance
on forward-looking statements as a prediction of actual results.
Furthermore, the Company undertakes no obligation to update, amend,
or clarify forward-looking statements.
WOLVERINE WORLD WIDE,
INC.
CONSOLIDATED CONDENSED
STATEMENTS OF OPERATIONS
(Unaudited)
(In millions, except earnings
per share)
Quarter Ended
Year-To-Date Ended
October 2, 2021
September 26, 2020
October 2, 2021
September 26, 2020
Revenue
$
636.7
$
493.1
$
1,779.3
$
1,281.5
Cost of goods sold
361.9
291.1
1,011.8
750.5
Gross profit
274.8
202.0
767.5
531.0
Gross margin
43.2
%
41.0
%
43.1
%
41.4
%
Selling, general and administrative
expenses
215.0
157.5
591.2
457.2
Environmental and other related costs, net
of recoveries
17.3
1.9
11.9
6.8
Operating expenses
232.3
159.4
603.1
464.0
Operating expenses as a % of revenue
36.5
%
32.3
%
33.9
%
36.2
%
Operating profit
42.5
42.6
164.4
67.0
Operating margin
6.7
%
8.6
%
9.2
%
5.2
%
Interest expense, net
9.6
12.8
28.9
31.1
Debt extinguishment and other costs
34.0
—
34.0
0.2
Other expense (income), net
(0.4
)
(0.6
)
2.5
(2.9
)
Total other expenses
43.2
12.2
65.4
28.4
Earnings (loss) before income taxes
(0.7
)
30.4
99.0
38.6
Income tax expense
0.1
8.7
17.0
6.0
Effective tax rate
(11.6
)
%
28.5
%
17.1
%
15.5
%
Net earnings (loss)
(0.8
)
21.7
82.0
32.6
Less: net loss attributable to
noncontrolling interests
(0.8
)
(0.7
)
(1.2
)
(1.2
)
Net earnings attributable to Wolverine
World Wide, Inc.
$
—
$
22.4
$
83.2
$
33.8
Diluted earnings per share
$
0.00
$
0.27
$
0.98
$
0.41
Supplemental information:
Net earnings (loss) used to calculate
diluted earnings per share
$
(0.2
)
$
21.8
$
81.8
$
33.0
Shares used to calculate diluted earnings
per share
82.3
81.5
83.4
81.5
WOLVERINE WORLD WIDE,
INC.
CONSOLIDATED CONDENSED BALANCE
SHEETS
(Unaudited)
(In millions)
October 2, 2021
September 26, 2020
ASSETS
Cash and cash equivalents
$
183.6
$
342.0
Accounts receivables, net
362.6
332.1
Inventories, net
412.0
325.7
Other current assets
44.4
42.2
Total current assets
1,002.6
1,042.0
Property, plant and equipment, net
127.3
126.3
Lease right-of-use assets
134.7
148.3
Goodwill and other indefinite-lived
intangibles
1,273.8
1,042.3
Other noncurrent assets
143.0
142.2
Total assets
$
2,681.4
$
2,501.1
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable and other accrued
liabilities
$
497.7
$
362.9
Lease liabilities
34.4
34.6
Current maturities of long-term debt
10.0
162.5
Borrowings under revolving credit
agreements
310.0
—
Total current liabilities
852.1
560.0
Long-term debt
704.4
714.1
Lease liabilities, noncurrent
117.9
135.0
Other noncurrent liabilities
365.1
326.5
Stockholders' equity
641.9
765.5
Total liabilities and stockholders'
equity
$
2,681.4
$
2,501.1
WOLVERINE WORLD WIDE,
INC.
CONSOLIDATED CONDENSED
STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)
Year-To-Date Ended
October 2, 2021
September 26, 2020
OPERATING ACTIVITIES:
Net earnings
$
82.0
$
32.6
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amortization
23.1
23.8
Deferred income taxes
(3.9
)
(12.8
)
Stock-based compensation expense
30.0
21.5
Pension and SERP expense
10.5
6.4
Debt extinguishment and other costs
5.6
0.2
Environmental and other related costs, net
of cash payments and recoveries received
(8.5
)
25.2
Other
(3.5
)
(0.6
)
Changes in operating assets and
liabilities
(118.3
)
39.2
Net cash provided by operating
activities
17.0
135.5
INVESTING ACTIVITIES:
Business acquisition, net of cash
acquired
(417.8
)
(5.5
)
Additions to property, plant and
equipment
(10.0
)
(6.0
)
Investment in joint ventures
—
(3.5
)
Proceeds from company-owned insurance
policy liquidations
—
25.6
Other
(1.9
)
(1.0
)
Net cash provided by (used in) investing
activities
(429.7
)
9.6
FINANCING ACTIVITIES:
Payments under revolving credit
agreements
(40.0
)
(898.0
)
Borrowings under revolving credit
agreements
350.0
538.0
Borrowings of long-term debt
550.0
471.0
Payments on long-term debt
(557.5
)
(28.5
)
Payments of debt issuance and debt
extinguishment costs
(7.4
)
(6.4
)
Cash dividends paid
(25.2
)
(25.4
)
Purchase of common stock for treasury
(26.9
)
(21.0
)
Employee taxes paid under stock-based
compensation plans
(13.7
)
(20.1
)
Proceeds from the exercise of stock
options
15.6
4.0
Contributions from noncontrolling
interests
4.8
1.8
Net cash provided by financing
activities
249.7
15.4
Effect of foreign exchange rate
changes
(0.8
)
0.9
Increase (decrease) in cash and cash
equivalents
(163.8
)
161.4
Cash and cash equivalents at beginning of
the year
347.4
180.6
Cash and cash equivalents at end of the
quarter
$
183.6
$
342.0
The following tables contain information regarding the non-GAAP
financial measures used by the Company in the presentation of its
financial results:
WOLVERINE WORLD WIDE,
INC.
Q3 2021 RECONCILIATION
TABLES
RECONCILIATION OF REPORTED
REVENUE
TO ADJUSTED REVENUE ON A
CONSTANT CURRENCY BASIS*
(Unaudited)
(In millions)
GAAP Basis 2021-Q3
Foreign Exchange
Impact
Constant Currency Basis
2021-Q3
GAAP Basis 2020-Q3
Constant Currency
Growth
Reported Growth
REVENUE
Wolverine Michigan Group
$
324.8
$
(2.7)
$
322.1
$
287.3
12.1
%
13.1
%
Wolverine Boston Group
258.8
(2.0)
256.8
193.8
32.5
%
33.5
%
Other
53.1
—
53.1
12.0
342.5
%
342.5
%
Total
$
636.7
$
(4.7)
$
632.0
$
493.1
28.2
%
29.1
%
RECONCILIATION OF REPORTED
REVENUE
TO ADJUSTED UNDERLYING
REVENUE*
(Unaudited)
(In millions)
GAAP Basis
Sweaty Betty (1)
Underlying Basis
Revenue - Fiscal 2021 Q3
$
636.7
$
(39.1)
$
597.6
(1)
Q3 2021 adjustment reflects the Sweaty
Betty® brand results included in the consolidated condensed
statement of operations.
RECONCILIATION OF REPORTED
eCOMMERCE REVENUE GROWTH
TO ADJUSTED UNDERLYING
eCOMMERCE REVENUE GROWTH*
(Unaudited)
GAAP Basis
Sweaty Betty (1)
Underlying Basis
eCommerce Revenue Growth - Fiscal 2021
Q3
44.7
%
31.4
%
13.3
%
(1)
Q3 2021 adjustment reflects the Sweaty
Betty® brand results included in the consolidated condensed
statement of operations.
RECONCILIATION OF REPORTED
GROSS MARGIN
TO ADJUSTED GROSS MARGIN* AND
ADJUSTED UNDERLYING GROSS MARGIN*
(Unaudited)
(In millions)
GAAP Basis
Adjustments (1)
As Adjusted
Sweaty Betty (2)
Underlying Basis
Gross Profit - Fiscal 2021 Q3
$
274.8
$
9.2
$
284.0
$
(25.8)
$
258.2
Gross margin
43.2
%
44.6
%
43.2
%
Gross Profit - Fiscal 2020 Q3
$
202.0
$
1.8
$
203.8
$
—
$
203.8
Gross margin
41.0
%
41.3
%
41.3
%
(1)
Q3 2021 adjustments reflect $7.0 million
of air freight charges related to production and shipping delays
caused by the COVID-19 pandemic and $2.2 million of costs
associated with the acquisition of the Sweaty Betty® brand. Q3 2020
adjustments reflect $1.8 million of expenses related to the
COVID-19 pandemic.
(2)
Q3 2021 adjustment reflects the Sweaty
Betty® brand results included in the consolidated condensed
statement of operations.
GAAP Basis
Adjustments (1)
As Adjusted
Gross Profit - Fiscal 2021 Q3
$
274.8
$
2.2
$
277.0
Gross margin
43.2
%
43.5
%
(1) Q3 2021 adjustments reflect 2.2 million
of costs associated with the acquisition of the Sweaty Betty®
brand.
RECONCILIATION OF REPORTED
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
TO ADJUSTED SELLING, GENERAL
AND ADMINISTRATIVE EXPENSES*
(Unaudited)
(In millions)
GAAP Basis
Adjustment (1)
As Adjusted
Selling, general and administrative
expenses - Fiscal 2021 Q3
$
232.3
$
(24.6)
$
207.7
Selling, general and administrative
expenses - Fiscal 2020 Q3
$
159.4
$
(7.9)
$
151.5
Selling, general and administrative
expenses - Fiscal 2019 Q3
$
175.0
$
(12.2)
$
162.8
(1)
Q3 2021 adjustments reflect $17.3 million
of environmental and other related costs net of recoveries and $7.3
million of costs associated with the acquisition of the Sweaty
Betty® brand. Q3 2020 adjustments reflect $1.9 million of
environmental and other related costs net of recoveries and
expenses related to the COVID-19 pandemic including $5.5 million of
severance expenses and $0.5 million of other related costs. Q3 2019
adjustments reflect $9.1 million of environmental and related
costs, $2.5 million of reorganization costs and $0.6 million of
business development related costs.
RECONCILIATION OF REPORTED
OPERATING MARGIN
TO ADJUSTED OPERATING MARGIN*
AND ADJUSTED UNDERLYING OPERATING MARGIN*
(Unaudited)
(In millions)
GAAP Basis
Adjustments (1)
As Adjusted
Sweaty Betty (2)
Underlying Basis
Operating Profit - Fiscal 2021 Q3
$
42.5
$
33.8
$
76.3
$
(1.8)
$
74.5
Operating margin
6.7
%
12.0
%
12.5
%
Operating Profit - Fiscal 2020 Q3
$
42.6
$
9.7
$
52.3
$
—
$
52.3
Operating margin
8.6
%
10.6
%
10.6
%
Operating Profit - Fiscal 2019 Q3
$
68.3
$
12.5
$
80.8
$
—
$
80.8
Operating margin
11.9
%
14.1
%
14.1
%
(1)
Q3 2021 adjustments reflect $17.3 million
of environmental and other related costs net of recoveries, $9.5
million of costs associated with the acquisition of the Sweaty
Betty® brand and $7.0 million of air freight charges related to
production and shipping delays caused by the COVID-19 pandemic. Q3
2020 adjustments reflect $1.9 million of environmental and other
related costs net of recoveries, expenses related to the COVID-19
pandemic, including $5.5 million of severance expenses and $2.3
million of other related costs. Q3 2019 adjustments reflect $9.1
million of environmental and related costs, $2.5 million of
reorganization costs, $0.6 million of business development related
costs and $0.3 million of other costs.
(2)
Q3 2021 adjustment reflects the Sweaty
Betty® brand results included in the consolidated condensed
statement of operations.
RECONCILIATION OF REPORTED
INVENTORY
TO ADJUSTED UNDERLYING
INVENTORY*
(Unaudited)
(In millions)
GAAP Basis
Sweaty Betty (1)
Underlying Basis
Inventories, net - Fiscal 2021 Q3
$
412.0
$
(52.5)
$
359.5
Inventories, net - Fiscal 2020 Q3
$
325.7
$
—
$
325.7
Inventories, net - Fiscal 2019 Q3
$
417.7
$
—
$
417.7
(1)
Q3 2021 adjustment reflects the Sweaty
Betty® brand inventories included in the consolidated condensed
balance sheet.
RECONCILIATION OF REPORTED
DILUTED EPS TO ADJUSTED
DILUTED EPS ON A CONSTANT
CURRENCY BASIS*
(Unaudited)
GAAP Basis
Adjustments (1)
As Adjusted
Foreign Exchange
Impact
As Adjusted
EPS On a Constant Currency
Basis
EPS - Fiscal 2021 Q3
$
0.00
$
0.62
$
0.62
$
(0.01)
$
0.61
EPS - Fiscal 2020 Q3
$
0.27
$
0.08
$
0.35
(1)
Q3 2021 adjustments reflect debt
extinguishment costs ($0.31 per share), costs associated with the
acquisition of the Sweaty Betty® brand ($0.09 per share), air
freight charges related to production and shipping delays caused by
the COVID-19 pandemic ($0.06 per share) and environmental and other
related costs net of recoveries ($0.16 per share). Q3 2020
adjustments reflect environmental and other related costs net of
recoveries, expenses related to the COVID-19 pandemic, including
severance and other related costs.
RECONCILIATION OF REPORTED
DILUTED EPS
TO ADJUSTED DILUTED EPS AND
ADJUSTED UNDERLYING DILUTED EPS*
(Unaudited)
GAAP Basis
Adjustments (1)
As Adjusted
Sweaty Betty (2)
Underlying Basis
EPS - Fiscal 2021 Q3
$
0.00
$
0.62
$
0.62
$
(0.02)
$
0.60
EPS - Fiscal 2020 Q3
$
0.27
$
0.08
$
0.35
$
—
$
0.35
(1)
Q3 2021 adjustments reflect debt
extinguishment costs ($0.31 per share), costs associated with the
acquisition of the Sweaty Betty® brand ($0.09 per share), air
freight charges related to production and shipping delays caused by
the COVID-19 pandemic ($0.06 per share) and environmental and other
related costs net of recoveries ($0.16 per share). Q3 2020
adjustments reflect environmental and other related costs net of
recoveries, expenses related to the COVID-19 pandemic, including
severance and other related costs.
(2)
Q3 2021 adjustment reflects the Sweaty
Betty® brand results included in the consolidated condensed
statement of operations
2021 GUIDANCE RECONCILIATION
TABLES
RECONCILIATION OF REPORTED
DILUTED EPS GUIDANCE TO ADJUSTED
DILUTED EPS GUIDANCE AND
SUPPLEMENTAL INFORMATION*
(Unaudited)
(In millions, except earnings
per share)
GAAP Basis
Adjustments (1)
As Adjusted
EPS - Fiscal 2021 Q4
$ 0.19 - $0.24
$
0.19
$ 0.38 - $0.43
EPS - Fiscal 2021 Full Year
$ 1.16 - $1.21
$
0.89
$ 2.05 - $2.10
Fiscal 2021 Full Year Supplemental
information:
Net Earnings
$99 - $103
$
75.0
$174 - $178
Net Earnings used to calculate diluted
earnings per share
$96 - $100
$
75.0
$171 - $175
Shares used to calculate diluted earnings
per share
83.4
83.4
(1)
2021 adjustments reflect estimated
environmental and other related costs net of recoveries, debt
extinguishment costs, costs associated with the acquisition of the
Sweaty Betty® brand, and air freight charges related to production
and shipping delays caused by the COVID-19 pandemic.
∗ To supplement the consolidated condensed financial
statements presented in accordance with Generally Accepted
Accounting Principles ("GAAP"), the Company describes what certain
financial measures would have been if, costs associated with the
acquisition of the Sweaty Betty® brand, environmental and other
related costs net of recoveries, costs related to the COVID-19
pandemic including air freight costs, credit loss expenses,
severance expenses and other related costs, reorganization expenses
and debt extinguishment costs were excluded. The Company also
describes what certain financial measures would have been if the
previously described financial measures also excluded the results
of the Sweaty Betty® brand. The Company believes these non-GAAP
measures provide useful information to both management and
investors by increasing comparability to the prior period by
adjusting for certain items that may not be indicative of core
operating measures and to better identify trends in the Company's
business. The adjusted financial results are used by management to,
and allow investors to, evaluate the operating performance of the
Company on a comparable basis.
The constant currency presentation, which is a non-GAAP measure,
excludes the impact of fluctuations in foreign currency exchange
rates. The Company believes providing constant currency information
provides valuable supplemental information regarding results of
operations, consistent with how the Company evaluates performance.
The Company calculates constant currency by converting the
current-period local currency financial results using the prior
period exchange rates and comparing these adjusted amounts to the
Company's current period reported results.
Management does not, nor should investors, consider such
non-GAAP financial measures in isolation from, or as a substitution
for, financial information prepared in accordance with GAAP. A
reconciliation of all non-GAAP measures included in this press
release, to the most directly comparable GAAP measures are found in
the financial tables above.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20211110005454/en/
Michael D. Stornant (616) 866-5728
Wolverine World Wide (NYSE:WWW)
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