Deckers’ Loss Smaller Than Feared

Deckers' Loss Smaller Than Feared
Angel Martinez Chairman, President, CEO; Deckers Outdoor Corp.

Deckers Outdoor Corp. beat estimates in the second quarter.

The Goleta, Calif.-based firm recorded a smaller loss than expected, as sales for the second quarter, ended June 30, came in higher than estimated.

The company’s net loss was $7.3 million, or 19 cents a share. Analysts were expecting a loss of 23 cents a share, as polled by Yahoo Finance.

Revenue, buoyed by momentum in the Ugg and Teva brands, as well as direct-to-consumer sales, advanced 13 percent to $154.2 million, from $137.1 million a year ago.

“The growth of our domestic business was primarily driven by strong sell-through of the Ugg brand spring line. We also experienced increased demand for the Teva brand light hiking and multi-sport footwear,” said Angel Martinez, president and CEO of Deckers, in a statement.

The firm’s bottom line was expected to take a hit due to additional costs associated with the transition to wholesale operations in the U.K. and Benelux and other infrastructure investments. But higher sales of the Teva brand spring collection and an increase in the Ugg brand fall product shipments to distributors helped offset that shift and mitigated the loss, the company said.

“As we start the second half of the year, we are excited about the pace of our business and future prospects. We have taken important steps that we believe will broaden the company’s growth opportunities and expand our earnings potential, including diversifying our merchandise offering, reassuming distribution rights in key geographic regions [and] accelerating our retail store openings,” added Martinez.

Cash and cash equivalents at the end of the period decreased 3 percent to $325.2 million — excluding cash payments of $126.6 million associated with the acquisition of the Sanuk brand that closed on July 1 — and no long-term debt.

Inventories increased 74 percent year over year to $210 million.

The company now expects its full-year revenue to grow about 26 percent over 2010 levels and earnings per share to increase about 17 percent.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s