“We delivered a strong finish to the fiscal year reflecting progress on our Global Growth Agenda, which drove over 5% constant currency revenue growth and record fourth quarter adjusted earnings per share of 0.59 US dollars. Our fourth quarter revenues were highlighted by mid-teens growth from our largest brands - Merrell and Sperry, acceleration in our digital-direct DTC offense and improved international expansion”, commented Blake Krueger, Wolverine World Wide’s Chairman, Chief Executive Officer and President.  "I am pleased with our performance in fiscal 2019 and proud of our team's efforts that contributed to another record year”, he concluded.

Fourth Quarter Review

Wolverine's reported revenue reached 607.4 million US dollars in the fourth quarter of the year, increasing by 4.8% compared to the prior year (adjusting for currency fluctuations the increase was 5.1%). Reported gross margin was 37.8%, decreased 140 basis points versus the prior year and reported operating margin was -0.8% (adjusted operating margin 10.1%). Reported diluted loss per share was 0.01 US dollars) compared to earnings per share of 0.39 US dollars in the prior year. Reported results include the impact of the previously disclosed litigation settlements related to legacy environmental matters.
  

Full Year Review

Reported revenue of 2 273.7 million US dollars increased by 1.5% compared to the prior year and adjusting for currency, increased by 2.3%. Reported gross margin of 40.6%, decreased 50 basis points versus the prior year.  Reported operating margin was 7.5%, and adjusted operating margin was 11.5%. Reported diluted earnings per share were 1.44 US dollars, compared to 2.05 US dollars in the prior year. Reported results include the impact of the previously disclosed litigation settlements related to legacy environmental matters. Adjusted diluted earnings per share increased 3.7% to 2.25 US dollars, compared to 2.17 US dollars in the prior year.

"We had a very solid finish to the year, with Merrell, Sperry and Saucony - our top three brands -  combining to deliver nearly 10% constant currency growth in the second half”, commented Mike Stornant, Senior Vice President and Chief Financial Officer, adding:  “In the fourth quarter, our eCommerce and International channels exceeded expectations and were major contributors to our overall performance.  Our efficient business model and strong deployment of capital throughout 2019 allowed us to deliver excellent earnings leverage, resulting in record adjusted earnings per share for both the fourth quarter and full-year. We are also pleased with our strong cash generation for the quarter and full-year, partially aided by excellent inventory management in the fourth quarter."

2020 Outlook

Wolverine is expecting revenue to be approximately 2.29 billion US dollars to 2.34 billion US dollars, representing growth of approximately 3.0% at the high-end of the range.  Constant currency revenue growth is expected to be approximately 3.5% at the high-end of the range. This outlook includes an estimated revenue impact from the coronavirus of approximately 30 million US dollars in the first half of 2020. Excluding the estimated coronavirus impact, constant currency growth in 2020 is expected to be 4.5% at the high-end of the range. Gross margin is expected to be approximately 41.0% and reported operating margin is expected to be approximately 11.0% (adjusted operating margin is expected to be approximately 12.0%).