Companies

Skechers reports strong second quarter

Jul 29, 2024 United States

The US-based company has reported a strong second quarter, with sales up by 7.2% year-on-year, despite macroeconomic headwinds. As a result, Skechers has raised its full year guidance

“In the face of significant operational and foreign exchange headwinds, Skechers delivered meaningful sales growth during the quarter, demonstrating the strength of our brand as the comfort technology leader”, commented John Vandemore, Chief Financial Officer of Skechers. “Demand for our innovative and diverse product portfolio remains robust, leading us to raise both sales and earnings expectations for the full year”, he concluded.

Second Quarter Results

In the second quarter of fiscal year 2024, the company’s sales reached 2.16 billion US dollars, an increase of 7.2% on a comparable basis to the same period of last year, with international sales up by 6.9% and domestic sales up by 7.7%. On a constant currency basis, sales increased by 8.7% year-on-year.

Skechers reported a wholesale sales growth of 5.5% to 1.13, as compared to the second quarter of 2023. This includes sales increases of 10% in the AMER region and 3.9% in the EMEA region, partially offset by a decrease in the APAC region of 2.5%.

The company’s direct-to-consumer sales, instead, rose by 9.2% to 1.03 billion US dollars, as compared to the second quarter of the previous year. This includes a sales increase of 40.6% in the EMEA region, 4.1% in the AMER region and 5.8% in the APAC region.

“These international increases are noteworthy given substantial headwinds from foreign currency, a lacklustre 6-18 in China, and supply chain disruptions related to the Suez Canal crisis”, pointed out David Weinberg, Chief Operating Officer of Skechers.

In the three months to the 30^th of June, Skechers’ gross margin widened by 220 basis year-on-year to 54.9%, mainly due to lower costs per unit, driven by lower freight and a favourable mix of direct-to-consumer volumes.

In the second quarter of the current fiscal year, the sneakers company posted net earnings of 140.3 million US dollars and diluted earnings per share of 0.91 US dollars, on a comparable basis to net earnings of 152.8 million US dollars and diluted earnings per share of 0.98 US dollars in the same prior-year quarter.

First Half Results

In the first half of 2024, Skechers’ sales increased by 9.8% year-on-year, reflecting an 11.1% increase in international sales and a 7.8%increase domestically. On a constant currency basis, sales increased by 11.0% year-on-year

The company’s year-to-date net earnings totalled 346.0 million US dollars and diluted earnings per share were 2.24 US dollars, an increase of 12.0% over the same period of the previous year.

Outlook

Skechers expects to achieve third quarter net sales between 2.30 billion and 2.35 billion US dollars and diluted earnings per share between 1.10 and 1.15 US dollars.

In addition, the US-based company now expects full year sales between 8.875 and 8.975 US dollars (previously: 8.73 billion to 8.88 billion US dollars) and full year diluted earnings per share between 4.08 and 4.18 US dollars (previously: 3.95 to 4.10 US dollars).

Image Credits: charlesclinkard.co.uk

United States Companies Footwear Quarter Results Results Skechers