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Profit down at Steve Madden

Apr 24, 2015 United States
Profit down at Steve Madden
The US–based designer and marketer of fashion footwear and accessories for women, men and children, announced decline in first quarter's profit despite increase of 6.3% in net sales
Steve Madden’s net sales in the first quarter increased by 6.3% to 323.9 million US dollars compared to 304.6 million US dollars in the same period of 2014.

Net sales for the wholesale business totaled 277.0 million US dollars in the first quarter compared to 265.0 million US dollars in the first quarter of 2014. Gross margin in the wholesale business decreased to 30.9% (32.6% in last year’s first quarter), with a decline in footwear primarily attributable to the impact from the Dolce Vita acquisition and a decline in accessories driven by changes in customer mix
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Retail net sales in the first quarter were 46.9 million US dollars compared to 39.6 million US dollars in the first quarter of the prior year. Same store sales increased 11.6% for the quarter. Retail gross margin decreased to 55.1% in the first quarter of 2015 (55.7% in similar period in 2014) as a result of increased promotional activity in the outlet stores.

Steve Madden's gross margin in the period reached 34.4% as compared to 35.6% in the same period last year.

Net income for the period reached 19.8 million US dollars (0.32 US dollars per diluted share), which compares to 23.6 million US dollars (0.36 US dollars per diluted share in the prior year's first quarter).

Edward Rosenfeld, Chairman and Chief Executive Officer, commented: “We were pleased with our first quarter results, with both sales and earnings meeting plan. Importantly, we saw a number of new fashion footwear trends begin to emerge, which contributed to double digit comparable store sales growth in our retail business. While sales in our wholesale footwear business excluding acquisitions were down, as expected, in the first quarter, we saw a meaningful improvement in sell-through at our retail partners compared to the prior year. In addition, our wholesale accessories business recorded a strong sales increase, driven by growth in Betsey Johnson, Madden Girl and private label handbags. Overall, we are pleased with the underlying trends we are seeing in our business and remain on track to meet our sales and earnings targets for 2015.”

For fiscal 2015, Steve Madden continues to expect net sales increase in the region of 7% to 9% over net sales in 2014. Diluted EPS for fiscal year 2015 is expected to be in the range of 1.85 US dollars to 1.95 US dollars.

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