Deckers Lowers Outlook After Q2 Ugg Sales Dip

Deckers Brands reported mixed second-quarter results after the market close Thursday as sales missed market watchers’ estimates, while profits were stronger than expected.

The parent company of Ugg, Teva, Sanuk and other footwear brands said its Q2 sales fell 0.2 percent year-over-year, to $485.9 million, missing estimates for sales of $495.8 million. On a constant-currency basis, net sales rose 0.3 percent.

Ugg, which brings in the lion’s share of the company’s revenue, saw sales slip 2.1 percent, to $412.2 million, during the quarter. Teva’s net sales also fell, by 4.2 percent, to $17.1 million, while Sanuk’s revenues increased by 9.2 percent, to $18.9 million.

“We are pleased with the results of our second quarter and the progress on our plans for the year,” said Dave Powers, Deckers’ newly appointed president and CEO, who took the reins from former CEO Angel Martinez. “Despite a challenging consumer environment, we delivered earnings-per-share results that were higher than last year and at the top end of our expectations. Looking ahead, our teams are prepared for the upcoming selling season, and we are excited about our fall and holiday product and marketing plans.”

Overall, profits rose 8 percent in the quarter, to $39.3 million, or $1.21 per diluted share, topping forecasts for diluted earnings per share of $1.19. Adjusted diluted earnings per share were $1.23.

Deckers also downward -djusted its full-year outlook and now expects its net sales to decrease 3 percent, to 1.5 percent. Diluted EPS is now expected in the range of $4.05 to $4.25.

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