World Footwear

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Skechers with record sales

Oct 19, 2018 United States
Skechers with record sales
The US-based footwear giant reported sales of 1.176 billion US dollars for the third quarter, an increase of 7.5%, or 8.5% on a constant currency basis, another record quarter. International wholesale sales increased by 11.8%
“Achieving record third quarter sales is a notable accomplishment given the strength of our third quarter 2017 sales”, began Robert Greenberg, Skechers Chief Executive Officer, adding: “Both our domestic and international businesses grew, and we remained the leader in walking, work, casual lifestyle and sandals footwear in the United States. We experienced strong product successes across multiple divisions around the world, which was evident by our double-digit growth in both our international wholesale and worldwide company-owned retail businesses ... We’re looking forward to fourth quarter growth across both our domestic and international channels and a new annual sales record.”

“As we near the close of 2018, we believe the direction of our business is on target with our record sales in the third quarter, continued international growth and strong gross margins,” stated David Weinberg, chief operating officer of Skechers. “With three record sales quarters in 2018 and brand acceptance around the globe, we achieved a new record for the first nine months of 3.56 billion US dollars, an 11.5% increase over last year. In the third quarter, our international distributor business returned to growth, increasing 11.6% over the same period last year, and combined with our international joint venture and subsidiary business, our total international wholesale sales increased 11.8% for the period. International wholesale along with international retail now represents 55.5% of our total business. We expect our business in the United States - both wholesale and retail - to grow in the fourth quarter. We remain committed to efficiently and profitably growing our global footwear business.”

Third quarter performance

Skechers sales grew by 7.5% as a result of an 11.8% increase in the company’s international wholesale business, and a 10.6% increase in its company-owned global retail business. Its domestic wholesale business decreased by 3.0%. Skechers’ total international business grew by 12.5% and its total domestic business grew by 1.8%. Third quarter comparable same store sales in company-owned retail stores worldwide increased by 1.9%, including an increase of 3.0% in the United States offset by a decrease of 0.8% in its international stores.

Net earnings for the period totaled 90.7 million US dollars and diluted earnings per share 0.58 US dollars. In the third quarter, the income tax rate for Skechers was 13.7%, reflecting its continued assessment of the impact of the recently enacted tax reform legislation. As a comparison, the company’s income tax rate for the three months ended on the 30th of September 2017 was 9.4%.

Nine months results

Sales grew by 11.5% as a result of an 18.9% increase in the company’s international wholesale business, and a 13.7% increase in its company-owned global retail business. For the nine-month period, its domestic wholesale business was essentially flat compared to the same prior year period. Skechers’ combined international wholesale and retail business grew by 19.7% and its combined domestic wholesale and retail business increased by 3.4%.

Net earnings
totaled 253.7 million US dollars and diluted earnings per share 1.62 US dollars. For the nine months period, the company’s income tax rate was 13.0%. As a comparison, the company’s income tax rate for the nine months ending on the 30th of September 2017 was 12.9%.

Image credits: Rawpixel on Unsplash

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