- FIRST QUARTER FY 2024 REVENUE INCREASED 10% TO $676 MILLION
- FIRST QUARTER FY 2024 DILUTED EARNINGS PER SHARE INCREASED
45% TO $2.41
- FY 2024 DILUTED EARNINGS PER SHARE GUIDANCE RAISED TO RANGE
OF $21.75-$22.25
GOLETA,
Calif., July 27, 2023 /PRNewswire/ -- Deckers
Brands (NYSE: DECK), a global leader in designing, marketing, and
distributing innovative footwear, apparel, and accessories, today
announced financial results for the first quarter ended
June 30, 2023. The Company also provided an update to its
financial outlook for the full fiscal year ending March 31, 2024.
"Deckers begins fiscal year 2024 in a position of strength,
accelerating towards our outlook for the full year, which has been
raised to reflect HOKA brand momentum," said Dave Powers, President and Chief Executive
Officer. "We remain dedicated to delivering results in alignment
with our strategic focus to grow DTC and build our presence within
international markets. Combined with our disciplined brand
marketplace management and nimble operating model, this
approach underscores our confidence to achieve our increased
full-year outlook and drive long-term success for our brands."
First Quarter Fiscal 2024 Financial Review
(Compared to the Same Period Last Year)
- Net sales increased 10.0% to $675.8 million compared to $614.5 million. On a constant currency basis, net
sales increased 11.1%.
-
- Channel
-
- Wholesale net sales were $425.4
million compared to $429.4
million.
- Direct-to-Consumer (DTC) net sales increased 35.3% to
$250.4 million compared to
$185.1 million. DTC comparable net
sales increased 33.4%.
- Geography
-
- Domestic net sales increased 9.1% to $419.5 million compared to $384.5 million.
- International net sales increased 11.4% to $256.3 million compared to $229.9 million.
- Gross margin was 51.3% compared to 48.0%.
- Selling, general, and administrative (SG&A) expenses
were $275.7 million compared to
$238.4 million.
- Operating income was $70.7
million compared to $56.3
million.
- Diluted earnings per share was $2.41 compared to $1.66.
First Quarter Fiscal 2024 Brand Summary (Compared
to the Same Period Last Year)
- HOKA® brand net sales increased 27.4% to $420.5 million compared to $330.0 million.
- UGG® brand net sales decreased 6.0% to $195.5 million compared to $207.9 million.
- Teva® brand net sales decreased 18.8% to $48.4 million compared to $59.6 million.
- Sanuk® brand net sales decreased 32.3% to $9.6 million compared to $14.2 million.
- Other brands, primarily composed of Koolaburra®, net sales
decreased 33.9% to $1.8 million
compared to $2.7 million.
Balance Sheet (June 30, 2023 as compared to
June 30, 2022)
- Cash and cash equivalents were $1.047
billion compared to $695.2
million.
- Inventories were $740.6 million
compared to $839.5 million.
- The Company had no outstanding borrowings.
Stock Repurchase Program
During the first quarter, the Company repurchased approximately
52 thousand shares of its common stock for a total of $25.5 million at a weighted average price paid
per share of $485.95. As of
June 30, 2023, the Company had
approximately $1.331 billion
remaining under its stock
repurchase authorization.
Full Fiscal Year 2024 Outlook for the Twelve Month Period
Ending March 31, 2024
The Company's full fiscal year 2024 outlook is forward-looking
in nature, reflecting our expectations as of July 27, 2023,
and is subject to significant risks and uncertainties that limit
our ability to accurately forecast results. This outlook assumes no
meaningful changes to the Company's business prospects or risks and
uncertainties identified by management that could impact future
results, which include but are not limited to: supply chain
disruptions, constraints and related expenses; labor shortages;
changes in economic conditions including foreign currency
fluctuation, inflationary pressures, consumer confidence and
discretionary spending; and geopolitical tensions.
- Net sales are now expected to be approximately $3.980 billion.
- Gross margin is still expected to be approximately 52%.
- SG&A expenses as a percentage of sales are still projected
to be approximately 34%.
- Operating margin is still expected to be approximately
18%.
- Effective tax rate is still expected to be approximately 22% to
23%.
- Diluted earnings per share is now expected to be in the range
of $21.75 to $22.25.
- The earnings per share guidance does not assume any impact from
potential future share repurchases.
Non-GAAP Financial Measures
In certain instances the Company may present financial measures
that were not prepared in accordance with generally accepted
accounting principles in the United
States (non-GAAP financial measures), including constant
currency, to provide information that may assist investors in
understanding its financial results and assessing its prospects for
future performance. The Company believes these non-GAAP financial
measures are important indicators of its operating performance
because they exclude items that are unrelated to, and may not be
indicative of, its core operating results.
The non-GAAP financial measures presented by the Company may not
necessarily be comparable to similarly titled measures of other
companies and may not be appropriate measures for comparing the
performance of other companies relative to Deckers. For example, in
order to calculate constant currency information, the Company
calculates the current period financial information using the
foreign currency exchange rates that were in effect during the
previous comparable period, excluding the effects of foreign
currency exchange rate hedges and remeasurements in the condensed
consolidated financial statements. Further, the Company reports DTC
comparable net sales on a constant currency basis for DTC
operations that were open throughout the current and prior
reporting periods, and may adjust prior reporting periods to
conform to current year accounting policies. These non-GAAP
financial measures are not intended to represent, and should not be
considered to be more meaningful measures than, or alternatives to,
measures of operating performance as determined in accordance with
GAAP. To the extent the Company utilizes such non-GAAP financial
measures in the future, it expects to calculate them using a
consistent method from period to period.
Conference Call Information
The Company's conference call to review the results for the
first quarter fiscal year 2024 will be broadcast live today,
Thursday, July 27, 2023, at 4:30 pm
Eastern Time and hosted at ir.deckers.com. You can
access the broadcast by clicking on the link within the "Webcast"
box at the top of the page. A replay of the broadcast will be
available for at least 30 days following the conference call and
can be accessed under the "Quarterly Earnings" section of the
"Financials" tab at the aforementioned website.
About Deckers Brands
Deckers Brands is a global leader in designing, marketing, and
distributing innovative footwear, apparel, and accessories
developed for both everyday casual lifestyle use and
high-performance activities. The Company's portfolio of brands
includes UGG®, HOKA®, Teva®, Sanuk®, and Koolaburra®. Deckers
Brands products are sold in more than 50 countries and territories
through select department and specialty stores, Company-owned and
operated retail stores, and select online stores, including
Company-owned websites. Deckers Brands has 50 years of history
building niche footwear brands into lifestyle market leaders
attracting millions of loyal consumers globally. For more
information, please visit www.deckers.com.
Forward-Looking Statements
This press release contains "forward-looking statements" within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995, which statements are
subject to considerable risks and uncertainties. Forward-looking
statements include all statements other than statements of
historical fact contained in this press release, including
statements regarding our projected financial results, including net
sales, gross margin, SG&A expenses, operating margin,
inventories, effective tax rate, and diluted earnings per share;
consumer confidence and discretionary spending; the strength of our
brands and demand for our products; our ability to drive future
growth and profitability; and our potential repurchase of shares.
We have attempted to identify forward-looking statements by using
words such as "anticipate," "believe," "could," "estimate,"
"expected," "intend," "may," "plan," "predict," "project,"
"should," "will," or "would," and similar expressions or the
negative of these expressions.
Forward-looking statements represent our management's current
expectations and predictions about trends affecting our business
and industry and are based on information available as of the time
such statements are made. Although we do not make forward-looking
statements unless we believe we have a reasonable basis for doing
so, we cannot guarantee their accuracy or completeness.
Forward-looking statements involve numerous known and unknown
risks, uncertainties and other factors that may cause our actual
results, performance or achievements to be materially different
from any future results, performance or achievements predicted,
assumed or implied by the forward-looking statements. Some of the
risks and uncertainties that may cause our actual results to
materially differ from those expressed or implied by these
forward-looking statements are described in the section entitled
"Risk Factors" in our Annual Report on Form 10-K for the fiscal
year ended March 31, 2023, as well as
in our Quarterly Reports on Form 10-Q and other filings with the
Securities and Exchange Commission.
Any forward-looking statement made by us in this press release
is based only on information currently available to us and speaks
only as of the date on which it is made. Except as required by
applicable law or the listing rules of the New York Stock Exchange,
we expressly disclaim any intent or obligation to update any
forward-looking statements, or to update the reasons actual results
could differ materially from those expressed or implied by these
forward-looking statements, whether to conform such statements to
actual results or changes in our expectations, or as a result of
the availability of new information.
DECKERS OUTDOOR
CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)
(dollar and share data
amounts in thousands, except per share data)
|
|
|
Three Months Ended
June 30,
|
|
2023
|
|
2022
|
Net
sales
|
$
675,791
|
|
$
614,461
|
Cost of
sales
|
329,367
|
|
319,709
|
Gross
profit
|
346,424
|
|
294,752
|
Selling, general, and
administrative expenses
|
275,688
|
|
238,411
|
Income from
operations
|
70,736
|
|
56,341
|
Total other income,
net
|
(10,628)
|
|
(661)
|
Income before income
taxes
|
81,364
|
|
57,002
|
Income tax
expense
|
17,812
|
|
12,153
|
Net
income
|
63,552
|
|
44,849
|
Total other
comprehensive loss, net of tax
|
(8,299)
|
|
(14,966)
|
Comprehensive
income
|
$
55,253
|
|
$
29,883
|
|
|
|
|
Net income per
share
|
|
|
|
Basic
|
$
2.43
|
|
$
1.67
|
Diluted
|
$
2.41
|
|
$
1.66
|
Weighted-average
common shares outstanding
|
|
|
|
Basic
|
26,165
|
|
26,777
|
Diluted
|
26,321
|
|
26,948
|
DECKERS OUTDOOR
CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED
BALANCE SHEETS (UNAUDITED)
(dollar amounts in
thousands)
|
|
|
June 30,
2023
|
|
March 31,
2023
|
ASSETS
|
|
|
(AUDITED)
|
Current
assets
|
|
|
|
Cash and cash
equivalents
|
$
1,046,889
|
|
$
981,795
|
Trade accounts
receivable, net
|
271,203
|
|
301,511
|
Inventories
|
740,553
|
|
532,852
|
Other current
assets
|
116,514
|
|
94,095
|
Total current
assets
|
2,175,159
|
|
1,910,253
|
Property and equipment,
net
|
288,760
|
|
266,679
|
Operating lease
assets
|
219,200
|
|
213,302
|
Other noncurrent
assets
|
164,783
|
|
165,969
|
Total
assets
|
$
2,847,902
|
|
$
2,556,203
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities
|
|
|
|
Trade accounts
payable
|
$
523,014
|
|
$
265,605
|
Operating lease
liabilities
|
51,234
|
|
50,765
|
Other current
liabilities
|
161,556
|
|
181,010
|
Total current
liabilities
|
735,804
|
|
497,380
|
Long-term operating
lease liabilities
|
209,367
|
|
195,723
|
Other long-term
liabilities
|
100,610
|
|
97,367
|
Total long-term
liabilities
|
309,977
|
|
293,090
|
Total stockholders'
equity
|
1,802,121
|
|
1,765,733
|
Total liabilities
and stockholders' equity
|
$
2,847,902
|
|
$
2,556,203
|
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