The first quarter of 2016 was big business for Skechers, who announced record sales for Q1.
The footwear brand recorded quarterly net sales of $978.8 million, up 27.4 percent from the $768.0 million earned over the same period last year. Net earnings, meanwhile, totaled $97.6 million ($0.63 per diluted share), up 72.5 percent from $56.1 million in 2015.
Skechers, which is the second largest footwear brand in the United States, soared past investor forecasts, beating revenue expectations by more than $60 million.
“At no other time in the Company’s history have we been stronger across our many product categories, marketing initiatives and multiple distribution channels. The growing demand for our brand has resulted in record revenues of $978.8 million and earnings from operations of $138.6 million for the first quarter of 2016,” said David Weinberg, Skechers COO and CFO.
For the first time ever, international became the company’s most profitable segment, with a 47.1 percent increase in international wholesale business over the first quarter of 2015, with international wholesale and retail combined accounting for 47.7 percent of total sales. Domestic wholesale, meanwhile, increased 12.1 percent, while company-owned retail sales increased by 23.2 percent over the prior year period.
“To meet the increased demand, we are investing in our infrastructure, including improved efficiencies in our European distribution center, which allowed us to achieve a record three million pairs shipped in a month during February,” said Weinberg. “With the completion of our European distribution center expansion to one million square feet in the second quarter of 2016, and with the automation to be fully completed later this year, we expect to be even more efficient in our largest market outside of the United States.”
Skechers CEO Robert Greenberg attributed the brand’s growth to its bevy of celebrity endorsers, including the likes of Meghan Trainor, Demi Lovato, Sugar Ray Leonard, Ringo Starr and the recently signed Howie Long.
“2016 marks Skechers’ 24th year in business and we couldn’t be more pleased to start 2016 with record quarterly revenues just shy of the billion dollar mark. By remaining focused on our product, building on our proven sellers—like our colorful and comfortable Skechers Sport collection and our vast array of Skechers GOwalk footwear—and introducing new designs, including a retro sport line that global singing sensation Meghan Trainor is wearing in her new Skechers campaign, we continue to innovate and further develop our global brand.”
Looking forward, Weinberg said he expects second quarter sales to be between $875 million and $900 million.
“Our first and third quarter net sales have the potential to become larger relative to the net sales balance of the other quarters as our international business becomes a greater percentage of our total net sales. We therefore believe there could be upside opportunity for the third quarter of 2016 and the balance of the year.”