The company narrowed its second quarter loss and handily beat expectations as it sold through a backlog of toning inventory and is now focusing on its company-owned stores, heritage lines and a new performance division.
In the period ended June 30, the Manhattan Beach, Calif.-based firm posted a loss of $1.8 million, or 4 cents a share, compared to a loss of $29.9 million, or 62 cents, in the year-ago quarter. Net sales during the quarter fell 11 percent to $384 million, versus $434.4 million for the second quarter of 2011.
Analysts were expecting a loss of 12 cents on revenue of $372.7 million, as polled by Yahoo Finance.
Gross profit margin also rose significantly to 44.6 percent, from 33 percent a year ago.
“The focus at this time last year was the clearing of excess toning inventory, which is now substantially complete and allows us to capitalize on the strength of our brand by selling more full-priced product, while offering new lifestyle and performance looks,” COO and CFO David Weinberg said in a statement. “This has resulted in an increase in average selling price per pair in our domestic wholesale business. In our company-owned Skechers domestic concept stores, which are the first to receive our new products, we achieved low single-digit positive comp store sales and a high single-digit percentage pair increase.”
Weinberg said he expected further improvements in the business during the back half of the year, including in the international business.
Skechers ended the period with $374.2 million in cash and $71.3 million in debt.