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Wolverine announces record revenue

Jul 18, 2014 United States
Wolverine announces record revenue
In the second quarter of the year, the US based company generated revenue reaching 613.5 million US dollars, a solid increase of 4.4% compared to similar period in the previous year. Net income increased from 17.9 million US dollars to 27.5 million US dollars
"We are extremely pleased to deliver a record quarter in what continues to be a volatile global retail environment, particularly in the US", said Blake W. Krueger, Wolverine's Chairman and Chief Executive Officer.

The second quarter of year, ending 14th June, presented revenue and earnings exceeding expectations, with total revenue growing 4.4% from 587.8 million US dollars to 613.5 million US dollars. Net earnings attributable to the company rose to 27.5 million US dollars from 17.9 million US dollars in the prior year, 53.6% increment. Earnings per share advanced to 0.27 US dollars from 0.18 US dollars.



Krueger noted that "all of our operating groups achieved a revenue increase in the quarter, which was spread across nearly every region of the world. Our Saucony, Keds, Caterpillar Footwear, Chaco and Wolverine brands posted very strong year-over-year results, and double-digit revenue gains in EMEA, Latin America and Asia-Pacific highlight the broad geographic reach of our portfolio."

Based on revised expectations for the remainder of the year, the company expects its full-year consolidated revenue to be in the region of 2.78 billion US dollars, which would express growth of approximately 3% compared to prior year revenue of 2.69 billion US dollars. The company is reaffirming its adjusted earnings per share estimate in the range of 1.57 US dollars to 1.63 US dollars per share – growth of 10% to 14% compared to prior year adjusted earnings per share of 1.43 US dollars.  On a reported basis, earnings per share are expected in the range of 1.32 US dollars to 1.38 US dollars per share.

"The company delivered record financial performance in the second quarter, highlighting the strength of our business model and our team's dedication to identifying operating efficiencies", commented Don Grimes, Wolverine' Senior Vice President and Chief Financial Officer.  "As we turn to the back half of the year, we have taken a somewhat more conservative approach to our revenue outlook, reflective of a continued soft retail environment in the US".

Wolverine also announced a Strategic Realignment Plan that includes closing approximately 140 retail locations, primarily Stride Rite stores, over the next 18 months. According to the press release issued by the company: “The realignment of the consumer-direct business is intended to optimize the fleet of retail locations, right-size the supporting infrastructure, address a fundamental shift in consumer shopping behavior and allow for greater focus on important omnichannel initiatives“. Other key components of the plan announced include: consolidation of consumer-direct functions, specifically store operations and field support teams, intended to allow for a more effective and efficient management of the retail fleet and implementation of organizational and infrastructure changes to realize further synergies.

Once the plan is fully implemented, the company expects annual pretax benefits of approximately 11 million US dollars and intends to redeploy a meaningful portion of these benefits to further build out consumer-direct omni-channel capabilities and accelerate growth in its wholesale operations.

Wolverine shares were last trade at 24.59 US dollars on the Nasdaq on the 18th of July 2014.

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