Crocs, Inc. reported fourth-quarter revenue increased 32% to $179.2 million, over revenue of $136.0 million reported in the fourth quarter of 2009. Net income improved to $4.7 million, or 5 cents per share compared to a net loss of $11.4 million, 13 cents, in the fourth quarter 2009.
Year-over year fourth quarter changes in the company's channel and regional revenue streams were as follows:
   * Wholesale sales increased 27% to $97.7 million;
   * Retail sales increased 36% to $59.6 million;
   * Internet sales increased 44% to $21.9 million;
   * Americas increased 36% to $94.1 million;
   * Asia increased 24% to $62.4 million;
   * Europe increased 37% to $22.7 million.
Gross profit for the fourth quarter of 2010 increased 43% to $86.3 million, or 48.2% as a percentage of sales, from $60.3 million, or 44.3% of sales in same period last year. Selling, General, & Administrative expenses (including foreign exchange, restructuring, impairment, and charitable contributions) increased 9% to $80.9 million versus $74.1 million a year ago. As a percentage of sales, SG&A decreased to 45.1% from 54.5% in the fourth quarter of 2009.
Revenue for 2010 increased 22% to $789.7 million, over revenue of $645.8 million reported in 2009. Net income for 2010 improved to $67.7 million, or $0.76 per diluted share compared to a net loss of $42.1 million, or ($0.49) per diluted share in 2009.
Year-over year annual changes in the company's channel and regional revenue streams were as follows:
   * Wholesale sales increased 19% to $481.8 million;
   * Retail sales increased 29% to $232.9 million;
   * Internet sales increased 24% to $75.0 million;
   * Americas increased 25% to $377.1 million;
   * Asia increased 20% to $284.8 million;
   * Europe increased 21% to $127.7 million.
Gross profit for 2010 increased 41% to $423.8 million or 53.7% as a percentage of sales, from $301.0 million, or 46.6% of sales in 2009. Selling, general, & administrative expenses (including foreign exchange, restructuring, impairment, and charitable contributions) decreased 3% to $342.7 million versus $352.1 million a year ago. As a percentage of sales, SG&A decreased to 43.4% from 54.5% in 2009.
Balance Sheet
Cash and cash equivalents at December 31, 2010 increased 88% to $145.6 million compared to $77.3 million at December 31, 2009. The company had an immaterial amount of bank debt as of Dec. 31, 2010.
In-line with the 32% increase in year-over-year fourth quarter sales and in support of the 57% increase over prior year end backlog to $258.4 million, inventory grew 30% to $121.2 million at Dec. 31, 2010 from $93.3 million at Dec. 31, 2009. On a sequential basis, inventories declined 15% from $142.5 million at Sept. 30, 2010. The company ended the fourth quarter of 2010 with accounts receivable of $64.3 million compared to $50.5 million at Dec. 31, 2009.
“We had a good fourth quarter that concluded a year in which we achieved profitability in all four quarters for the first time since 2007,” said John McCarvel, president and chief executive officer. “We reengaged the consumer during 2010 through great product and more effective marketing and merchandising programs. Our recent performance demonstrates we are succeeding at generating new demand and evolving into a year round brand as we continue to diversify our product line. At the same time, we've made important investments in our operating platform to support our multi channel growth strategy and drive efficiency. Looking ahead, our backlog is up 57%, with all regions posting strong increases. We're very pleased with the brand strength reflected in these future orders and we see continued potential for profitable expansion of our business.”
Guidance
For the first quarter of 2011, the company expects revenue of approximately $215 million, a 29% increase over first quarter 2010. The company expects diluted earnings per share for the first quarter 2011 to be approximately $0.19. This guidance assumes an effective tax rate of 27% and outstanding diluted shares of approximately 91 million.
| CROCS, INC. AND SUBSIDIARIES | ||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (In thousands, except share and per share data) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
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|
 |
|
 |
|
 |
|
 |
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Three Months Ended
December 31,
|
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Twelve Months Ended
December 31,
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|
|
|
2010 |
|
2009 |
|
2010 |
|
2009 | ||||||||
|
|
|
|
|
|
|
|
|
 |
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Revenues |
|
$ |
179,192 |
|
|
$ |
136,011 |
|
|
$ |
789,695 |
|
|
$ |
645,767 |
|
Cost of sales |
|
 |
92,859 |
 |
|
 |
75,743 |
 |
|
 |
365,931 |
 |
|
 |
344,806 |
 |
Gross profit |
|
|
86,333 |
|
|
|
60,268 |
|
|
|
423,764 |
|
|
|
300,961 |
|
Selling, general and administrative expenses |
|
|
81,104 |
|
|
|
70,835 |
|
|
|
342,121 |
|
|
|
311,592 |
|
|
Foreign currency transaction losses (gains), net |
|
|
(583 |
) |
|
|
582 |
|
|
|
(2,912 |
) |
|
|
(665 |
) |
Restructuring charges |
|
|
– |
|
|
|
1,653 |
|
|
|
2,539 |
|
|
|
7,623 |
|
Asset impairment charges |
|
|
– |
|
|
|
638 |
|
|
|
141 |
|
|
|
26,085 |
|
Charitable contributions expense |
|
 |
344 |
 |
|
 |
214 |
 |
|
 |
840 |
 |
|
 |
7,510 |
 |
Income (loss) from operations |
|
|
5,468 |
|
|
|
(13,072 |
) |
|
|
81,035 |
|
|
|
(51,184 |
) |
Interest expense |
|
|
212 |
|
|
|
83 |
|
|
|
657 |
|
|
|
1,495 |
|
Gain on charitable contributions |
|
|
(88 |
) |
|
|
(330 |
) |
|
|
(223 |
) |
|
|
(3,163 |
) |
Other (income) expense |
|
 |
(278 |
) |
|
 |
625 |
 |
|
 |
(191 |
) |
|
 |
(895 |
) |
Income (loss) before income taxes |
|
|
5,622 |
|
|
|
(13,450 |
) |
|
|
80,792 |
|
|
|
(48,621 |
) |
Income tax (benefit) expense |
|
 |
893 |
 |
|
 |
(2,002 |
) |
|
 |
13,066 |
 |
|
 |
(6,543 |
) |
Net income (loss) |
|
$ |
4,729 |
 |
|
$ |
(11,448 |
) |
|
$ |
67,726 |
 |
|
$ |
(42,078 |
) |
Net income (loss) per common share: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
0.05 |
 |
|
 |
($0.13 |
) |
|
$ |
0.78 |
 |
|
 |
($0.49 |
) |
Diluted |
|
$ |
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