Madden Continues Winning Streak

NEW YORK — Buoyed by increased sales, Steven Madden Ltd. raised its full-year guidance and is upbeat on the season ahead.

The Long Island City, N.Y.-based company said it is seeing strong sell-throughs in booties this fall and is getting good early reads on pumps going into next year.

“We’ve got a lace-up bootie right now that’s about as hot an item as we’ve [ever] had … so we still feel very good about that category,” Edward Rosenfeld, chairman and CEO of Steven Madden, said on a conference call with analysts last week. “[And] people still feel good about pumps [for spring].”

Footwear sales for the firm surged 34 percent in the third quarter to $123.3 million, driven by robust increases in the Madden Girl, Steve Madden Men’s and international divisions, and analysts agreed the company has strong momentum in its retail operations.

“What seemed to be the flawless spot was the retail business. Not only were comps up 16 percent but the margins were also better because they had fewer markdowns,” said Jeff Van Sinderen, analyst at B. Riley & Co. “That speaks to a strong demand for their product.”

Madden’s directly operated outlets also performed well, raking in more than $700 in sales per square foot for the first time since the beginning of 2007, the firm said. For the 12 months ended Sept. 30, Madden’s retail stores recorded sales of $710 per square foot, up from $628 in the same period last year.

International was the company’s fastest-growing division, as its revenue doubled in the quarter. The firm said it expects the segment to grow from its current $30 million in annual sales to $100 million in the next four years.

The men’s and accessories businesses also recorded growth. The latter saw a 26 percent increase in revenue, driven by healthy gains in Steve Madden and Betsey Johnson handbags and belts.

Since finalizing its acquisition of the Betsey Johnson brand on Oct. 5, Madden has signed three new licensing agreements for the brand, including one for cold-weather accessories.

“We’re also hard at work on Betsey Johnson shoes. We plan on showing Betsey Johnson footwear at the December [FFANY show] and making initial shipments to customers by the beginning of April,” said Rosenfeld.

Madden earned 81 cents a share in the third quarter, up 27 percent from 64 cents in the same period a year ago.

Net income for the period surged 29 percent to $22.9 million, compared with $17.8 million in the year-ago quarter, while revenue advanced 31 percent to $184.1 million. For fiscal 2010, Madden expects revenue to increase about 25 percent over 2009, and earnings per share to be in the range of $2.57 to $2.62.

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