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Deckers raises guidance for the full year

Oct 26, 2017 United States
Deckers raises guidance for the full year
Despite a minor decline in net sales registered in the second quarter, an improvement of the gross margin of the group has contributed to an renovated guidance for the rest of the year
Second quarter net sales declined by 0.7% totaling 482.5 million US dollars compared to 485.9 million US dollars for the same period last year. On a constant currency basis, net sales decreased by 0.3%. In the period under analysis, operating income was 67.4 million US dollars compared to 54.0 million US dollars for the same period last year.

A significant part of the growth registered within group was driven by the 34.4% increase in net sales from Hoka One One (totaling 40.6 million compared to 30.2 million US dollars for the same period last year). Teva brand net sales for the second quarter also increased by an impressive rate: 24.9% up to 21.4 million US dollars from the 7.1 million US dollars for the same period last year.

As for UGG brand net sales for the second quarter these declined by 2.9% reaching 400.4 million US dollars (compares to 412.2 million US dollars for the same period last year). Sanuk brand net sales for the second quarter decreased by 19.3% to 15.2 million US dollars compared to 18.9 million US dollars for the same period last year.

Wholesale net sales for the second quarter declined by 2.2% totaling 391.2 million US dollars compared to 399.9 million US dollars for the same period last year. DTC net sales for the second quarter increased 6.2% to 91.3 million US dollars  compared to 86.0 million US dollars for the same period last year. DTC comparable sales for the second quarter increased 3.7% over the same period last year.

For the second quarter, domestic net sales decreased by 3.1% to 302.7 million US dollars compared to 312.2 million US dollars for the same period last year while international net sales increased by 3.5% to 179.8 million US dollars compared to 173.7 million US dollars for the same period last year.

“I am very pleased with the progress we have made, and continue to make, executing on our operating profit improvement plan. Our goal remains to achieve an incremental 100 million US dollars of operating profit by the end of our fiscal year 2020, and operating margins of at least 13% by focusing on full-priced selling, driving supply chain efficiencies, implementing process improvements, reducing indirect spend, and closing retail stores that do not meet our financial objectives”, commented Dave Powers, President and Chief Executive Officer.

With this new set of results in mind Deckers now expects net sales for fiscal year 2018 to be in the range of up approximately 1% to up 2% versus last year.

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