Weather woes and sluggish consumer demand took a bite out of Crocs Inc. in the second quarter, and analysts sounded a cautious note on the firm.
Robert W. Baird & Co. analyst Mitch Kummetz said it will be difficult for the Niwot, Colo.-based firm to make up lost ground during the back half of the year. “With unfavorable spring/summer weather negatively impacting the company’s performance at retail in the first half of 2013, we’re concerned that retailers will be cautious with pre-book orders for the first half of 2014, which could make for another challenging year,” Kummetz wrote in a note to investors.
Similarly, Sterne Agee analyst Sam Poser urged investors to stay on the sidelines with Crocs’ stock, given uncertainty in management’s guidance.
Market watchers had been expecting earnings of 64 cents a share for the quarter. The firm missed that forecast by 14 cents.
Crocs reported net income declined 42 percent to $35.4 million, or 40 cents a share, compared with $61.5 million, or 68 cents, for the year-ago quarter. For the three-month period ended June 30, revenues rose 9.9 percent to $363.8 million, compared with $330.9 million in 2012.
Crocs President and CEO John McCarvel elaborated on the firm’s challenges in a conference call last week. “Sell-through of products early in the quarter was slower than anticipated, but accelerated quickly in the latter half of May and throughout June,” he said. “Due to the late spring/summer buying season, many of our wholesale partners did not place additional at-once orders for delivery in the second and early third quarter.”