Crocs still facing headwinds but losses are reduced, margins rise

By

Sandra Halliday

Published
Nov 11, 2016

Footwear giant Crocs’ revenue may have been in line with guidance in the three months to September 30 but but that didn’t make it easy reading. Revenues were $245.9m, down from $274m.

On a currency-neutral basis revenue fell 11.6% in the quarter, faced with what the firm’s CEO said, “remains a challenging consumer environment.”

The net loss attributable to common stockholders was $5.4m/$0.07 per basic and diluted share, but at least that was better than the $27.8m/$0.37 of a year ago. The company had to include one-off charges $3.3 million in the latest quarter which meant the net loss would have been closer to $2 million without those charges.

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CEO Gregg Ribatt said Crocs continues to manage its business tightly and while revenues were in line with expectations, the gross margin exceeded guidance by approximately 200 basis points as it further limited off-price selling and promotional activities. At the same time, it reduced its inventories 11% compared with last year.

Looking ahead, Crocs continues to plan conservatively “given the current top-line headwinds.”

It expects Q4 revenues to be in the $185m to $195m range compared to $208.7m a year earlier.