Steve Madden announced sales for the third quarter ended Sept. 30 were $140.1 million compared to $128.1 million reported in the comparable period of 2008.
Retail net sales totaled $28.2 million compared to $30.7 million in the third quarter of the prior year. Same store sales decreased 7.6% in the third quarter of 2009 compared to a 7.8% same store sales increase in the same period of 2008.
Gross margin improved to 44.0% as compared to 41.4% in the third quarter of 2008. For the wholesale business, gross margin was 41.2% as compared to 36.3% in the prior year's third quarter, with the increase driven primarily by reduced markdown allowances as a result of strong sell-through at retail. Retail division gross margin was 55.2% as compared to 57.4% for the comparable period last year. The decrease in retail gross margin was primarily due to increased promotional activity at retail stores as compared to last year’s third quarter.
Operating expenses as a percent of sales for the third quarter of 2009 were 27.9% as compared to 31.0% in the same period of the prior year. The 310 basis point improvement was mainly driven by leverage on higher sales as well as fewer stores and reduced store payroll expense in the Company’s remaining stores.
Net income for the third quarter of 2009 totaled $17.8 million, or $0.97 per diluted share as compared to net income of $11.1 million, or $0.62 per diluted share, in the same period of 2008.
The Company closed one retail location and licensed out three stores during the third quarter of 2009, ending the quarter with 88 retail locations, including the Internet store.
Nine-Month 2009 Results
For the first nine months of 2009, consolidated net sales were $364.0 million compared to $337.9 million in the comparable period last year.
Net income totaled $36.6 million, or $2.00 per diluted share, for the first nine months of 2009 compared to $20.8 million or $1.11 per diluted share in the first nine months of 2008. Net income for the first nine months of 2008 included a charge totaling $3.0 million post-tax, or 16 cents per diluted share, related to the resignation of the Company’s former CEO.
As of Sept. 30, 2009, cash, cash equivalents and marketable securities totaled $125.7 million.
Arvind Dharia, Chief Financial Officer, commented, “Our balance sheet remains very healthy as a result of the continuation of strong growth in our earnings and prudent capital management.”
Company Outlook
For fiscal 2009, the company expects net sales to increase in the range of 7%-8% compared to net sales in 2008.
Diluted EPS for 2009 is expected to be in the range of $2.55 to $2.65
STEVEN MADDEN LTD | ||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS | ||||||||||||
(In thousands, except per share data) | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
Consolidated: | Sep 30, 2009 | Sep 30, 2008 | Sep 30, 2009 | Sep 30, 2008 | ||||||||
Net Sales | $ | 140,138 | $ | 128,093 | $ | 364,039 | $ | 337,949 | ||||
Cost of Sales | 78,462 | 75,114 | 209,313 | 199,218 | ||||||||
Gross Profit | 61,676 | 52,979 | 154,726 | 138,731 | ||||||||
Commission and licensing fee income | 5,726 | 4,497 | 15,993 | 11,056 | ||||||||
Operating Expenses | 39,088 | 39,770 | 112,729 | 117,097 | ||||||||
Income from Operations | 28,314 | 17,706 | 57,990 | 32,690 | ||||||||
Interest and other Income, Net | 488 | 248 | 1,252 | 1,142 | ||||||||
Income Before provision for Income Taxes | 28,802 | 17,954 | 59,242 | 33,832 | ||||||||
Provision for Income Tax | 10,971 | 6,866 | 22,690 | 13,058 | ||||||||
Net Income | $ | 17,831 | $ | 11,088 | $ | 36,552 | $ | 20,774 | ||||
Basic income per share | $ | 0.99 | $ | 0.62 | $ | 2.03 | $ | 1.12 | ||||
Diluted income per share | $ | 0.97 | $ | 0.62 | $ | 2.00 | $ | 1.11 | ||||
Weighted average common shares | ||||||||||||
outstanding – Basic | 18,101 | 17,763 | 18,002 | 18,478 | ||||||||
Weighted average common shares | ||||||||||||
outstanding – Diluted | 18,449 | 17,986 | 18,239 | 18,675 | ||||||||
