Long Island City, NY–Steven Madden, Ltd. reported today that its second quarter profit rose more than 20% thanks to higher sales.
The second quarter figures, which beat analysts’ forecasts again, included the fifth double digit increase in sales and the third straight quarter with a rise in income.
For the quarter ended June 30, net income rose 20.1% to $23.8 million, or 55 cents a share, up from $19.8 million, or 47 cents a share, a year ago.
Revenue rose 31.8% to $209.2 million. Analysts’ average estimates expected earnings of 54 cents a share on revenue of $194.4 million in the second quarter.
Full Year Net Sales Forecast: Up 47% to 49%
Noting that “trend-right merchandise created by Steve and his design team resulted in strong gains in women’s wholesale, retail and international divisions,” Edward Rosenfeld, chairman and ceo, added that “we further enhanced our footwear and accessories offerings in the quarter with the acquisitions of Topline and Cejon, both completed in May.”
While the acquisition of privately held Topline for $55 million in cash was a strategic move to expand its private label footwear business, it may have put some pressure on the company’s gross margins. Gross margins fell to 40.2% for the quarter, compared with 43.4% a year ago.
The company’s retail net sales grew 15.3% to $34 million from $29.5 million in the second quarter of the prior year. Comparable store sales increased 11.6% on top of a 7.4% increase second quarter 2010. During the quarter, the company opened one full-price store and one outlet store, acquired one Report store in the Topline acquisition, and closed three stores in the quarter.
Looking ahead, Steve Madden raised its full year forecast to earn $2.15 to $2.20 a share this year, up from its prior view of $2.03 to $2.10 a share. The company said it expects 2011 net sales to increase 47% to 49%. Analysts’ average estimate expects profits of $2.15 a share for the fiscal year.
