Goleta, CA—Deckers Outdoor Corp., parent to UGG, reported Thursday afternoon a better-than-expected first quarter loss as sales increased 24.3%.
Deckers posted a first quarter loss of $1.07 a share, compared to the loss of 85 cents in the previous year. That was better than the $1.28 a share loss analysts had expected.
Net revenue was up 24.3% to $211.5 million, well ahead of estimates at $191 million, with solid growth across its three major brands.
Demand for Spring Product
By brand, UGG brand increased 22.8% to $123.3 million compared to $100.4 million for the same period last year. The increase in sales was driven by “sales gains across all primary channels, including higher global wholesale and international distributor sales, the sales contribution from new worldwide retail store openings and an increase in global e-commerce sales, partially offset by a decrease in same store sales.”
At Teva brand net sales increased 25.7% to $39.3 million compared to $31.2 million for the same period last year. The increase in sales was driven by sales gains across all primary channels, including higher global wholesale and international distributor sales, an increase in global E-Commerce sales and higher U.S. retail sales, Deckers said.
Sanuk brand net sales increased 19.6% to $36 million compared to $30.1 million for the same period last year. At Deckers’ other brands, combined net sales of the Company’s other brands increased 54.5% to $12.9 million, primarily attributable to a $4.5 million increase in sales for the HOKA ONE ONE brand.
“We are pleased with the start of our new fiscal year,” said Angel Martinez, president/ceo, chairman. “Our strong top-line performance was fueled by consumer demand for our compelling spring collections from the UGG, Teva, Sanuk and HOKA brands combined with higher initial wholesale shipments of UGG brand fall styles. Sales trends were once again strongest in our Direct-to-Consumer division and we believe that our omni-channel initiatives aimed at elevating the consumer experience, strengthening customer connections and improving service levels continue to yield positive results. As we head towards our busiest selling season, we believe we are well positioned from a merchandise, marketing and inventory standpoint to capitalize on the opportunities we are creating throughout each of our distribution channels and geographic regions.”
Direct-to-Consumer comparable sales, which include worldwide retail same store sales and worldwide comparable e-commerce sales, increased 10% over the same period last year. Retail sales increased 29.4% to $42 million compared to $32.5 million for the same period last year.
E-commerce sales increased 43.7% to $15.4 million compared to $10.7 million for the same period last year. Domestic sales increased 20.1% to $132.3 million compared to $110.1 million for the same period last year. And international sales increased 32.1% to $79.2 million compared to $60 million for the same period last year.
For Deckers full year forecast, the company now expects a 14.5% rise in earnings per share up from 13.5% jump envisioned earlier — taking into account estimated gross profit margin of approximately 49% and an operating margin of about 13%.
For the second quarter, Deckers now forecasts 18% revenue growth and expects earnings per share to come in at 98 cents. Analysts’ estimate is for $1.13 a share.