Wolverine Q2 Profit Falls on Acquisition Costs

Wolverine-070913Rockford, MI—Wolverine Worldwide reported Tuesday a 13% decline in its second quarter profits due to expenses relating to its recent footwear brand acquisitions.

For the quarter ended June 15, Wolverine posted net income of $17.9 million compared to a profit of $20.5 million a year earlier. Excluding the impact of acquisition and integration costs of Sperry Top-Sider, Saucony, Stride Rite, and Keds brands, adjusted earnings were 48 cents a share, a 12.2% increase on the same quarter last year. That was ahead of analysts’ average estimate for 34 cents a share.

Net revenue was up 88% to $587.8 million but analysts expected $591.03 million in sales.

Excluding the new brands, revenue grew 5.5%. Sperry Top-Sider, Keds, Saucony, and Harley-Davidson Footwear led the revenue growth in the quarter.

Gross margin also increased 320 basis points to 41%, driven by pricing discipline, favorable brand and channel mix, and better inventory management, the company said.

 “We are extremely pleased to report excellent financial results in our most recent quarter,” said Blake Krueger, chairman/ceo.chairman. “The combined power of our brand portfolio is virtually unmatched in the industry, and the continuing global consumer interest in authentic brands anchored in performance and heritage positions us well for future growth.”

For the full year, the company now expects adjusted earnings per share to be in the range of $2.60 to $2.75, up from the prior estimate of $2.50 to $2.65 a share.

Net sales for the year are still expected to be between $2.7 billion to $2.775 billion, representing 6% to 8.9% growth.

Analysts expect the company to report earnings of $2.69 a share, on revenues of $2.74 billion for the full year.

 

 

 

 

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Jeff Prine

Jeff Prine, Editor at Large, Accessories Magazine
Jeff returns as a regular contributor to Accessories magazine. Initially Jeff worked as senior editor at Accessories more than 20 years ago and his love of the industry has followed him until present. Since his tenure here, Jeff has continued to report jewelry, watch and other luxury goods trends as executive editor at Modern Jeweler magazine, fashion director at Lustre, and as contributor on products and trends for consumer and trade publications and websites. In addition to his editorial experience, Jeff also served as an adjunct instructor for accessories merchandising at Fashion Institute of Technology. jeffp@busjour.com