Wolverine Q2 Profit Falls on Acquisition Costs

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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.