"We continue to see positive momentum in the fiscal year, and we are raising our full year outlook to reflect the acceleration we are seeing in the HOKA brand, while at the same time maintaining expectations for the UGG brand heading into the peak selling season", commented Dave Powers, President and Chief Executive Officer, adding: "As we move into the third quarter, the teams are intently focused on our key strategies and are committed to building excitement around new product offerings through planned targeted marketing investments that will be visible in the coming months."

Second Quarter Review

Deckers' net sales increased by 8.0% to 542.2 million US dollars compared to 501.9 million US dollars for the same period last year. On a constant currency basis, net sales increased by 9.5%. Operating income was 97.1 million US dollars compared to GAAP operating income of 90.4 million US dollars for the same period last year. Diluted earnings per share was 2.71 US dollars compared to the GAAP diluted earnings per share of 2.48 US dollars for the same period last year.

Net sales for the UGG brand in the second quarter increased by 2.2% totalling 404.9 million US dollars compared to 396.3 million US dollars in similar period last year. HOKA ONE ONE brand net sales for the second quarter increased by 49.9% to 78.1 million US dollars compared to 52.1 million US dollars in similar quarter in 2018. Teva brand net sales increased by 6.7% to 23.0 million US dollars compared to 21.5 million US dollars in the second quarter in the previous year. Sanuk brand net sales for the second quarter decreased by 22.4% to 10.7 million US dollars compared to 13.8 million US dollars in similar period last year.

Channel Summary

Wholesale net sales for the second quarter increased by 8.7% to 443.5 million US dollars compared to 408.0 million US dollars for the same period last year. DTC net sales for the second quarter increased by 5.1% to 98.7 million US dollars compared to 93.9 million US dollars for the same period last year. DTC comparable sales increased by 7.2% over the same period last year.

Geographic Summary

Domestic net sales for the second quarter increased by 14.9% to 358.0 million US dollars compared to 311.6 million US dollars for the same period last year. International net sales for the second quarter decreased by 3.2% to 184.2 million US dollars compared to 190.3 million US dollars for the same period last year. On a constant currency basis, international net sales decreased by 0.5%.

Outlook

For the twelve-month period ending on the 31^st of March 2020, Deckers is now expecting net sales to be in the range of 2.115 billion US dollars to 2.140 billion US dollars. Net sales for the third quarter are now expected to be in the range of 885 million US dollars to 900 million US dollars.

Board of Directors Announcement

Effective from the 24^th of October the Board of Directors has appointed Mike Devine as Chairman of the Board. Mr. Devine has served as a member of our Board since 2011. He succeeds John Gibbons, who has served as Chairman since September 2017 and as a Director since 2000. Mr. Gibbons will continue to serve on the Board.