Steve Madden reported fourth-quarter revenues increased 73.7 percent to $279.8 million. Retail comparable store sales increased 15.9 percent. Net income increased 34.9 percent to $23.8 million, or 55 cents per diluted share, compared to $17.6 million, or 41 cents cents per share in the prior year’s fourth quarter.
Net income for fiscal 2011 increased 28.5 percent to $97.3 million, or $2.25 per diluted share, compared to $75.7 million, or $1.78 per diluted share in fiscal 2010.
Edward Rosenfeld, Chairman and Chief Executive Officer, commented, “We are pleased to have ended 2011 with record fourth quarter results. We delivered high-teen organic sales growth in each of our wholesale footwear, wholesale accessories and retail businesses. Our flagship Steve Madden brand led the way, as we recorded strong gains in Steve Madden women’s footwear and handbags in both wholesale and retail and in both the United States and international markets. We also continued to integrate and capitalize on our new acquisitions, Topline and Cejon, which are proving to be excellent additions to the business. We believe we are well-positioned as we head into 2012, with a strong portfolio of brands, a proven business model, and a number of substantial growth opportunities which we anticipate will enable us to continue to drive top and bottom line gains.”
Fourth Quarter 2011 Results
Fourth quarter net sales were $279.8 million compared to $161.0 million reported in the comparable period of 2010. Net sales from the wholesale business grew 95.2 percent to $225.9 million compared to $115.8 million in the fourth quarter of 2010. The growth in net sales reflects contributions from Topline and Cejon, acquired in May of 2011, and the transition of the company's Target private label and Olsenboye footwear businesses from the buying agency model to the wholesale model, as well as strong growth in the existing wholesale footwear and wholesale accessories businesses.
Retail net sales grew 18.9 percent to $53.8 million from $45.3 million in the fourth quarter of the prior year. Same store sales increased 15.9 percent following a 14.1 percent increase in the prior year’s fourth quarter. The company opened two full-price stores and one outlet store and closed one full-price store during the quarter. The company ended the quarter with 84 retail locations, including the Internet store.
Gross margin was 35.5 percent in the fourth quarter as compared to 43.2 percent in the comparable period of 2010, with the decrease due to sales mix shifts as a result of the addition of the Topline and Cejon businesses and the inclusion of the company’s Target private label and Olsenboye footwear businesses in wholesale net sales. Excluding these businesses, consolidated gross margin would have been moderately higher compared with the prior year’s fourth quarter. Gross margin in the wholesale business decreased to 28.9 percent in the fourth quarter from 35.7 percent in the prior year's fourth quarter due to the aforementioned sales mix shifts. Retail gross margin increased to 63.1 percent for the fourth quarter from 62.5 percent in the comparable period of the prior year due to reduced promotional activity, particularly on stevemadden.com.
Operating expenses as a percent of sales were 23.1 percent for the fourth quarter compared to 29.1 percent in the same period of the prior year, due to leverage on higher sales and the aforementioned sales mix shifts.
Operating income for the fourth quarter increased to $38.6 million, or 13.8 percent of net sales, compared with operating income of $27.3 million, or 17.0 percent of net sales, in the same period of 2010.
Fourth quarter net income increased 34.9 percent to $23.8 million, or $0.55 per diluted share, compared to $17.6 million, or $0.41 per diluted share in the prior year's fourth quarter.
Full Year 2011 Results
For the full year ending December 31, 2011, net sales were $968.5 million compared to $635.4 million in the comparable period last year.
Operating income for the full year increased 26.4 percent to $153.8 million, or 15.9 percent of net sales, compared with operating income of $121.6 million, or 19.1 percent of net sales, in fiscal 2010.
Net income totaled $97.3 million, or $2.25 per diluted share, for the year ended December 31, 2011, compared to $75.7 million, or $1.78 per diluted share, in fiscal 2010.
At the end of the year, cash, cash equivalents and marketable securities totaled $180.5 million.
Company Outlook
For the year ending December 31, 2012, the company expects net sales to increase 21 percent 23 percent compared to fiscal 2011. Diluted EPS is expected to be in the range of $2.60 $2.70.
