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Skechers expands distribution centre in Europe and announces record sales

Aug 27, 2014 United States
Skechers expands distribution centre in Europe and announces record sales
The company’s distribution centre in Belgium will be expanded to support increased sales across Europe. Skechers announced net sales up by 28.8% in the first 6 months of the year
Skechers USA, Inc. announced plans to expand its European Distribution Centre (EDC) in Belgium by an additional 25 000 m2 to make the facility the largest company-operated DC in the Walloon Region at a total size of 70 000 m2.

“This expansion is a testament to the incredible growth that we’ve seen in our business throughout Europe and mirrored around the globe” commented David Weinberg, Chief Operating Officer and Chief Financial Officer of Skechers, adding: “We feel that the opportunity for continued growth in Europe remains high and we’re excited to expand our EDC to meet the increasing demand for Skechers product.”

“Thanks to the success of our business in the region supported by the EDC, additional space is needed for future storage and operational requirements” began Sophie Houtmeyers, Skechers EDC Vice President of Distribution Operations. “This extension will give us more flexibility for the future. Combined with new automation technologies that we expect to completely install by the end of 2014, these investments will allow us to expand operations in the execution of our European logistics.”

The Skechers EDC was inaugurated in 2002 over a surface area of 21 000 m2. At the time, it employed only three people and a number of temporary workers, depending on the periods of peak and off-peak activity. The continued growth of Skechers in the European market resulted in an extension of the building in 2009 with 23 000 m2 of additional space. In 2013, the volume of goods was four times higher than in 2002 and employment increased up to 150 full-time equivalents. The Skechers EDC receives goods arriving from China via the port of Antwerp. The goods are then stored until they are redistributed to European markets. The customers of the EDC are third-party accounts, 31 company-owned and 19 franchisee-owned Skechers stores throughout Western Europe, e-commerce in Europe, as well as the Company’s international distribution partners in the European region.

This announcement is made after Skechers USA, Inc. reported the highest quarterly net sales in its history during the three months period ended 30th June, reaching 587.1 million US dollars (compares to 428.2 million US dollars in H 1 2013). The company declared: “Demand for the Skechers brand is at an all-time high across nearly every region where the company distributes its product and Europe in particular has seen strong business with high double digit net sales increases in the second quarter and for the first six months of 2014 as compared to the same periods last year”. Net sales stood at 1 133.6 million US dollars for the six months period ending in June 2014, comparing to 879.9 million US dollars in similar period in 2013, a 28.8% growth. Net earnings for the period reached 65.8 million US dollars, a 377.5% increase from the 13.8 million US dollars in similar period last year.

“The strength of our new product combined with the power of our marketing and diverse distribution resulted in a 37.1% sales increase over last year’s second quarter and the highest quarterly revenues in the Company’s 22-year history. These results followed a record first quarter, resulting in a 28.8% net sales increase for the first six months of 2014” commented David Weinberg, Chief Operating officer and chief financial officer. “The strong sales are attributable to fresh styles across our lifestyle, performance and kids’ categories, and the demand for our product resulted in a positive shift of our Back-to-School domestic wholesale and international subsidiary shipments originally scheduled for July into June. We achieved double-digit increases in our domestic wholesale business, which included a 4% increase in average price per pair; double-digit increases in our international wholesale business, with some markets up triple digits; and double-digit growth in our Company-owned retail stores, which achieved a 13.9% comparable quarter net sales increase. We are pleased with our financial achievements in our businesses worldwide as is evidenced by our operating margin of 9.2% for the second quarter.”

Skechers shares were last traded at 59.43 USD on the 25th August at the New York Stock Exchange.

For more inforlation about Skechers USA, Inc. please refer to the company's website.

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