“The major beat in the fourth quarter highlights that Skechers is well positioned for a very strong 2013,” said Sam Poser, analyst at Sterne Agee. “Multiple categories are working well. Expenses are under control.”
Christopher Svezia, analyst at Susquehanna Financial, noted, “Domestic wholesale sales have clearly rebounded and accelerated faster than expected.” Overseas sales have also bounced back strongly, he said.
For its part, Skechers management is bullish on its GoRun lines, which it said have become a key growth category, with triple-digit gains in the fourth quarter. “We’ve got great demand for our product. We’re shipping well. We still feel sell-throughs are going well,” David Weinberg, COO and CFO of Skechers, said on a conference call with analysts last week.
He added, “We’re brand-new to the [running] category. And as much as it’s grown, as successful as it’s been, we’ve only scratched the tip of the iceberg. It certainly has the biggest growth potential over a number of years and [also] worldwide.”
To that end, Weinberg said, the firm will further expand its performance division with new lines in the second quarter.
The Manhattan Beach, Calif.-based firm saw major improvements for the fourth quarter ended Dec. 31. Net income was $4 million, or 8 cents a share, compared with a loss of $57.7 million, or $1.18, the same quarter a year ago.
Total revenue came in at $395.6 million, a 39.7 percent increase, from $283.2 million a year ago. The firm said it saw progress across all channels, including a 72 percent rise in domestic wholesale and a 30 percent international bump.
Outside the U.S., the firm remains cautious about the Spanish and Italian markets, but said it is seeing a positive trend emerging in Italy. The Middle East and Africa regions surged, with 115 percent growth. Distributors in the Philippines, South Korea, Taiwan, Australia and New Zealand grew a combined 27 percent.
Retail revenue rose by 16.2 percent, with domestic sales improving by 16.6 percent and international by 14 percent. Total e-commerce sales increased by 39.4 percent in the quarter. Net income for 2012 was $9.5 million total, or 19 cents, compared with a net loss of $67.5 million, or $1.39, in 2011. Revenue slipped slightly to $1.56 billion, from $1.61 billion.
Skechers ended the period with $325.8 million in cash and $128.5 million in long-term debt.