Skechers sales top $1bn as global ops drive Q1, but low-price shoes keep US growth flat
Skechers has posted another record financial performance, this time for the first quarter. The footwear company on Thursday announced record sales of $1.073 billion, marking as a new quarterly record for the brand and the first time it exceeded $1 billion in quarterly sales.
The three-time Footwear Brand of the Year has posted ongoing record performances, most recently in February when it reported $764.3 million in Q4 net sales and $3.56 billion in full-year net sales. The international business segment has been a major factor for the company’s quarterly sales performances, and it played a major role again in Q1.
The international business as a whole grew to 51.3% of total sales for the company. Skechers in 2016 increased its focus on the segment by entering into a new joint venture in Korea, opening a new distribution center in Belgium, and opening a new store in Madrid.
Robert Greenberg, Skechers CEO, said, “Our global footprint continues to grow with our ongoing success in Canada, Chile and China as well as in India, Australia and Turkey, and many other markets. This success is in part due to the expansion of Skechers retail stores around the world. At quarter end, there were 2,055 Skechers retail stores, including 1,471 third-party-owned locations, of which 551 are in China alone.
First quarter net sales increased 9.6%, driven by a 16.8% increase in the international wholesale business and a 12.8% increase in Skechers’ company-owned global retail business. The domestic wholesale business did not perform as well, posting flat numbers in the quarter compared to the previous year, but this was as a result of stronger sales in lower-priced lines, including Bobs from Skechers and the sandal business.
Gross profit for the quarter increased to $476.5 million, or 44.4% of sales, and net earnings fell 3.7% to $94 million. In addition, earnings from operations fell 10.2% to $124.4 million.
Skechers also expects to achieve record net sales in the second quarter in range of $950 million to $975 million, and projects earnings per share to be between $0.42 and $0.47.
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