Skechers Announces First Quarter 2024 Financial Results and Record Sales of $2.25 Billion
First Quarter Highlights
-
Record sales of
$2.25 billion , a 12.5% increase - Wholesale sales grew 9.8%
- Direct-to-Consumer sales grew 17.3%
-
Diluted earnings per share of
$1.33 , a 30.4% increase -
Repurchased
$60.0 million of Class A common stock
“For the first quarter, Skechers achieved a new sales record of
“We began the new year by setting a new sales record, delivering results above expectations, and further expanding the Skechers brand globally,” said
First Quarter 2024 Financial Results
|
|
Three Months Ended |
|
|
Change |
|
||||||||||
(in millions, except per share data) |
|
2024 |
|
|
2023 |
|
|
$ |
|
|
% |
|
||||
Sales |
|
$ |
2,251.6 |
|
|
$ |
2,001.9 |
|
|
|
249.7 |
|
|
|
12.5 |
|
Gross profit |
|
|
1,181.6 |
|
|
|
978.6 |
|
|
|
203.0 |
|
|
|
20.7 |
|
Gross margin |
|
|
52.5 |
% |
|
|
48.9 |
% |
|
|
|
|
360 bps |
|
||
Operating expenses |
|
|
882.8 |
|
|
|
755.0 |
|
|
|
127.8 |
|
|
|
16.9 |
|
As a % of sales |
|
|
39.2 |
% |
|
|
37.7 |
% |
|
|
|
|
150 bps |
|
||
Earnings from operations |
|
|
298.8 |
|
|
|
223.6 |
|
|
|
75.2 |
|
|
|
33.6 |
|
Operating margin |
|
|
13.3 |
% |
|
|
11.2 |
% |
|
|
|
|
210 bps |
|
||
Net earnings attributable to |
|
|
206.6 |
|
|
|
160.4 |
|
|
|
46.2 |
|
|
|
28.8 |
|
Diluted earnings per share |
|
$ |
1.33 |
|
|
$ |
1.02 |
|
|
|
0.31 |
|
|
|
30.4 |
|
First quarter sales increased 12.5% as a result of a 15.2% increase internationally and a 7.8% increase domestically. Wholesale increased 9.8% and Direct-to-Consumer increased 17.3%. On a constant currency basis, sales increased 13.4%.
Wholesale sales grew
Direct-to-Consumer sales grew
Gross margin was 52.5%, an increase of 360 basis points, primarily due to lower costs per unit, driven by lower freight costs and higher average selling prices.
Operating expenses increased
Earnings from operations increased
Net earnings were
In the first quarter, the Company’s effective income tax rate was 19.0%.
“Skechers continues to reach new milestones in expanding our global footprint. Achieving another sales record and exceptional earnings is a testament to the strength of our brand and our ability to meet consumers’ needs,” stated
Balance Sheet
Cash, cash equivalents and investments totaled
Inventory was
Share Repurchase
During the first quarter, the Company repurchased 1.0 million shares of its Class A common stock at a cost of
Outlook
For the second quarter of 2024, the Company believes it will achieve sales between
Store Count
|
|
Number of Stores |
||||||||||||
|
|
|
|
|
Opened |
|
|
Closed |
|
|
|
|||
Domestic stores |
|
|
563 |
|
|
10 |
|
|
(8 |
) |
|
|
565 |
|
International stores |
|
|
1,085 |
|
|
42 |
|
|
(21 |
) |
|
|
1,106 |
|
Distributor, licensee and franchise stores |
|
|
3,520 |
|
|
95 |
|
|
(83 |
) |
|
|
3,532 |
|
Total Skechers stores |
|
|
5,168 |
|
|
147 |
|
|
(112 |
) |
|
|
5,203 |
First Quarter 2024 Conference Call
The Company will host a conference call at
About
Skechers,
Reference in this press release to “Sales” refers to Skechers’ net sales reported under GAAP. This announcement contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may include, without limitation, Skechers’ future domestic and international growth, financial results and operations including expected net sales and earnings, its development of new products, future demand for its products, its planned domestic and international expansion, opening of new stores and additional expenditures, and advertising and marketing initiatives. Forward-looking statements can be identified by the use of forward-looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include the disruption of business and operations
due to` delays
or disruptions in our supply chain; international economic, political and market conditions including the effects of inflation and foreign currency exchange rate fluctuations around the world, the challenging consumer retail markets in
|
||||||||
Condensed Consolidated Balance Sheets |
||||||||
(Unaudited) |
||||||||
|
|
As of |
|
|
As of |
|
||
(in thousands) |
|
|
|
|
|
|
||
ASSETS |
|
|||||||
Current assets |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
1,020,458 |
|
|
$ |
1,189,910 |
|
Short-term investments |
|
|
88,564 |
|
|
|
72,595 |
|
Trade accounts receivable, net |
|
|
1,158,384 |
|
|
|
860,300 |
|
Other receivables |
|
|
76,632 |
|
|
|
82,253 |
|
Inventory |
|
|
1,360,630 |
|
|
|
1,525,409 |
|
Prepaid expenses and other |
|
|
225,726 |
|
|
|
222,137 |
|
Total current assets |
|
|
3,930,394 |
|
|
|
3,952,604 |
|
Property, plant and equipment, net |
|
|
1,519,463 |
|
|
|
1,506,690 |
|
Operating lease right-of-use assets |
|
|
1,298,349 |
|
|
|
1,276,171 |
|
Deferred tax assets |
|
|
447,085 |
|
|
|
450,574 |
|
Long-term investments |
|
|
143,503 |
|
|
|
123,996 |
|
|
|
|
101,230 |
|
|
|
101,230 |
|
Other assets, net |
|
|
127,416 |
|
|
|
136,086 |
|
Total non-current assets |
|
|
3,637,046 |
|
|
|
3,594,747 |
|
TOTAL ASSETS |
|
$ |
7,567,440 |
|
|
$ |
7,547,351 |
|
LIABILITIES AND EQUITY |
|
|||||||
Current liabilities |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
828,824 |
|
|
$ |
1,008,001 |
|
Accrued expenses |
|
|
302,213 |
|
|
|
320,105 |
|
Operating lease liabilities |
|
|
277,733 |
|
|
|
274,296 |
|
Current installments of long-term borrowings |
|
|
233,756 |
|
|
|
46,571 |
|
Short-term borrowings |
|
|
— |
|
|
|
11,894 |
|
Total current liabilities |
|
|
1,642,526 |
|
|
|
1,660,867 |
|
Long-term operating lease liabilities |
|
|
1,122,157 |
|
|
|
1,108,110 |
|
Long-term borrowings |
|
|
112,536 |
|
|
|
242,944 |
|
Deferred tax liabilities |
|
|
12,167 |
|
|
|
12,594 |
|
Other long-term liabilities |
|
|
124,363 |
|
|
|
122,794 |
|
Total non-current liabilities |
|
|
1,371,223 |
|
|
|
1,486,442 |
|
Total liabilities |
|
|
3,013,749 |
|
|
|
3,147,309 |
|
Stockholders’ equity |
|
|
|
|
|
|
||
Preferred Stock |
|
|
— |
|
|
|
— |
|
Class A Common Stock |
|
|
132 |
|
|
|
133 |
|
Class B Common Stock |
|
|
20 |
|
|
|
20 |
|
Additional paid-in capital |
|
|
228,594 |
|
|
|
295,847 |
|
Accumulated other comprehensive loss |
|
|
(86,020 |
) |
|
|
(73,388 |
) |
Retained earnings |
|
|
4,003,352 |
|
|
|
3,796,730 |
|
|
|
|
4,146,078 |
|
|
|
4,019,342 |
|
Noncontrolling interests |
|
|
407,613 |
|
|
|
380,700 |
|
Total stockholders' equity |
|
|
4,553,691 |
|
|
|
4,400,042 |
|
TOTAL LIABILITIES AND EQUITY |
|
$ |
7,567,440 |
|
|
$ |
7,547,351 |
|
|
||||||||
Condensed Consolidated Statements of Earnings |
||||||||
(Unaudited) |
||||||||
|
|
Three Months Ended |
||||||
(in thousands, except per share data) |
|
2024 |
|
|
2023 |
|||
Sales |
|
$ |
2,251,587 |
|
|
$ |
2,001,928 |
|
Cost of sales |
|
|
1,069,953 |
|
|
|
1,023,349 |
|
Gross profit |
|
|
1,181,634 |
|
|
|
978,579 |
|
Operating expenses |
|
|
|
|
||||
Selling |
|
|
156,501 |
|
|
|
128,560 |
|
General and administrative |
|
|
726,335 |
|
|
|
626,442 |
|
Total operating expenses |
|
|
882,836 |
|
|
|
755,002 |
|
Earnings from operations |
|
|
298,798 |
|
|
|
223,577 |
|
Other (expense) income |
|
|
(2,050 |
) |
|
|
9,923 |
|
Earnings before income taxes |
|
|
296,748 |
|
|
|
233,500 |
|
Income tax expense |
|
|
56,370 |
|
|
|
43,216 |
|
Net earnings |
|
|
240,378 |
|
|
|
190,284 |
|
Less: Net earnings attributable to noncontrolling interests |
|
|
33,756 |
|
|
|
29,841 |
|
Net earnings attributable to |
|
$ |
206,622 |
|
|
$ |
160,443 |
|
Net earnings per share attributable to |
|
|
|
|
||||
Basic |
|
$ |
1.35 |
|
|
$ |
1.03 |
|
Diluted |
|
$ |
1.33 |
|
|
$ |
1.02 |
|
Weighted-average shares used in calculating net earnings per share attributable to |
|
|
|
|
||||
Basic |
|
|
152,918 |
|
|
|
155,140 |
|
Diluted |
|
|
155,119 |
|
|
|
156,755 |
|
||||||||||||||||
Supplemental Financial Information |
||||||||||||||||
(Unaudited) |
||||||||||||||||
Segment Information |
||||||||||||||||
|
Three Months Ended |
|
|
Change |
|
|||||||||||
(in millions) |
|
2024 |
|
|
2023 |
|
|
$ |
|
|
% |
|
||||
Wholesale sales |
|
$ |
1,421.7 |
|
|
$ |
1,294.6 |
|
|
|
127.1 |
|
|
|
9.8 |
|
Gross profit |
|
|
636.0 |
|
|
|
512.0 |
|
|
|
124.0 |
|
|
|
24.2 |
|
Gross margin |
|
|
44.7 |
% |
|
|
39.6 |
% |
|
|
|
|
520 bps |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct-to-Consumer sales |
|
$ |
829.9 |
|
|
$ |
707.3 |
|
|
|
122.6 |
|
|
|
17.3 |
|
Gross profit |
|
|
545.6 |
|
|
|
466.6 |
|
|
|
79.0 |
|
|
|
16.9 |
|
Gross margin |
|
|
65.7 |
% |
|
|
66.0 |
% |
|
|
|
|
(20) bps |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total sales |
|
$ |
2,251.6 |
|
|
$ |
2,001.9 |
|
|
|
249.7 |
|
|
|
12.5 |
|
Gross profit |
|
|
1,181.6 |
|
|
|
978.6 |
|
|
|
203.0 |
|
|
|
20.7 |
|
Gross margin |
|
|
52.5 |
% |
|
|
48.9 |
% |
|
|
|
|
360 bps |
|
Additional Sales Information |
||||||||||||||||
|
Three Months Ended |
|
|
Change |
|
|||||||||||
(in millions) |
|
2024 |
|
|
2023 |
|
|
$ |
|
|
% |
|
||||
Geographic sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Domestic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Wholesale |
|
$ |
476.0 |
|
|
$ |
441.9 |
|
|
|
34.1 |
|
|
|
7.7 |
|
Direct-to-Consumer |
|
|
322.8 |
|
|
|
299.0 |
|
|
|
23.8 |
|
|
|
8.0 |
|
Total domestic sales |
|
|
798.8 |
|
|
|
740.9 |
|
|
|
57.9 |
|
|
|
7.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
International |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Wholesale |
|
|
945.7 |
|
|
|
852.6 |
|
|
|
93.1 |
|
|
|
10.9 |
|
Direct-to-Consumer |
|
|
507.1 |
|
|
|
408.4 |
|
|
|
98.7 |
|
|
|
24.1 |
|
Total international sales |
|
|
1,452.8 |
|
|
|
1,261.0 |
|
|
|
191.8 |
|
|
|
15.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total sales |
|
$ |
2,251.6 |
|
|
$ |
2,001.9 |
|
|
|
249.7 |
|
|
|
12.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Regional sales |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
$ |
1,019.5 |
|
|
$ |
945.9 |
|
|
|
73.6 |
|
|
|
7.8 |
|
|
|
|
627.6 |
|
|
|
534.5 |
|
|
|
93.1 |
|
|
|
17.4 |
|
|
|
|
604.5 |
|
|
|
521.5 |
|
|
|
83.0 |
|
|
|
15.9 |
|
Total sales |
|
$ |
2,251.6 |
|
|
$ |
2,001.9 |
|
|
|
249.7 |
|
|
|
12.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
$ |
319.5 |
|
|
$ |
282.0 |
|
|
|
37.5 |
|
|
|
13.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Distributor sales |
|
$ |
125.9 |
|
|
$ |
103.9 |
|
|
|
22.0 |
|
|
|
21.2 |
|
Reconciliation of GAAP Earnings Financial Measures to Corresponding Non-GAAP Financial Measures
(Unaudited)
Constant Currency Adjustment (Non-GAAP Financial Measure)
We evaluate our results of operations on both an as reported and a constant currency basis. The constant currency presentation, which is a non-GAAP measure, excludes the impact of period-over-period fluctuations in foreign currency exchange rates. We believe providing constant currency information provides valuable supplemental information regarding our results of operations, thereby facilitating period-to-period comparisons of our business performance and is consistent with how management evaluates the Company’s performance. We calculate constant currency percentages by converting our current period local currency financial results using the prior-period exchange rates and comparing these adjusted amounts to our prior period reported results.
|
|
Three Months Ended |
|||||||||||||||||||||||
|
|
2024 |
|
|
2023 |
|
Change |
||||||||||||||||||
(in millions, except per share data) |
|
Reported GAAP Measure |
|
Constant Currency Adjustment |
|
Adjusted for Non-GAAP Measures |
|
Reported GAAP Measure |
|
$ |
|
% |
|||||||||||||
Sales |
|
$ |
2,251.6 |
|
|
$ |
18.2 |
|
$ |
2,269.8 |
|
$ |
2,001.9 |
|
|
267.9 |
|
|
|
13.4 |
|
||||
Cost of sales |
|
|
1,070.0 |
|
|
|
6.9 |
|
|
1,076.9 |
|
|
1,023.3 |
|
|
53.6 |
|
|
|
5.2 |
|
||||
Gross profit |
|
|
1,181.6 |
|
|
|
11.3 |
|
|
1,192.9 |
|
|
978.6 |
|
|
214.3 |
|
|
|
21.9 |
|
||||
Operating expenses |
|
|
882.8 |
|
|
|
8.7 |
|
|
891.5 |
|
|
755.0 |
|
|
136.5 |
|
|
|
18.1 |
|
||||
Earnings from operations |
|
|
298.8 |
|
|
|
2.6 |
|
|
301.4 |
|
|
223.6 |
|
|
77.8 |
|
|
|
34.8 |
|
||||
Other income (expense) |
|
|
(2.0 |
) |
|
|
4.3 |
|
|
2.3 |
|
|
9.8 |
|
|
(7.5 |
) |
|
|
(76.5 |
) |
||||
Income tax expense |
|
|
56.4 |
|
|
|
0.6 |
|
|
57.0 |
|
|
43.2 |
|
|
13.8 |
|
|
|
31.9 |
|
||||
Less: Noncontrolling interests |
|
|
33.8 |
|
|
|
1.0 |
|
|
34.8 |
|
|
29.8 |
|
|
5.0 |
|
|
|
16.6 |
|
||||
Net earnings attributable to |
|
$ |
206.6 |
|
|
$ |
5.3 |
|
$ |
211.9 |
|
$ |
160.4 |
|
|
51.5 |
|
|
|
32.1 |
|
||||
Diluted earnings per share |
|
$ |
1.33 |
|
|
$ |
0.04 |
|
$ |
1.37 |
|
$ |
1.02 |
|
|
0.35 |
|
|
|
34.3 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240425881470/en/
Investor Relations
investors@skechers.com
Press
jennc@skechers.com
Source: