Skechers announces promising Q3 results
Despite a sales dip, Manhattan Beach, California-based footwear company Skechers USA, Inc. announced third-quarter revenue on Thursday that was stronger-than-anticipated.
As the brand bounced back from disruptions caused by the Covid-19 pandemic, sales reached $1.3 billion, a 3.9 percent decrease year-over-year, but a 78.3 percent increase from second quarter 2020. This decline reflected a 4.1 percent decrease in its international business and a 3.7 percent decrease in its domestic business, where declines were partially offset by growth of 23.9 percent in China and 18.1 percent in Europe.
Likewise, for the third quarter ended September 30, 2020, domestic wholesale sales increased 6.3 percent, international wholesale sales decreased 0.5 percent and its direct-to-consumer business decreased 16.9 percent. Overall, comparable store sales in Skechers’ direct-to-consumer business fell 22.1 percent.
Net income was $64.3 million and diluted earnings per share were $0.41. Adjusted net earnings were $82.6 million and adjusted diluted earnings per share were $0.53.
“Skechers third quarter results illustrate the strength and resilience of our brand, as business across the globe began to recover from the effects of the global pandemic. There were many bright spots, from a return to growth in our domestic wholesale channel and continued strength in e-commerce to resurgent growth in China and Europe,” said John Vandemore, chief financial officer of Skechers.
“We continue to invest for growth, including increased penetration in our direct-to-consumer channel, evident in new stores and an enhanced digital presence, as well as improved global distribution infrastructure. We firmly believe that our focused strategy on global growth and deeper, direct relationships with consumers, coupled with our financial strength and operational capabilities, will translate into long-term growth for the Skechers brand.”
For the first nine months, sales decreased 15.9 percent, reflecting the impact of the global pandemic on its businesses worldwide. The company’s net earnings were $45.3 million and diluted earnings per share were $0.29. Adjusted net earnings were $63.6 million and adjusted diluted earnings per share were $0.41.
Due to ongoing uncertainty surrounding the evolution of the coronavirus crisis, the company has not provided financial guidance for the fourth quarter or full fiscal year 2020.
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