SKECHERS USA, Inc. saw Q1 net sales increase 12.7% to $277.6 million over net sales of $246.2 million for the first quarter of 2005. Net earnings for the quarter were $16.6 million versus net earnings of $10.3 million for the first quarter of 2005. Diluted earnings per share were 38 cents on 45,395,000 weighted average shares outstanding versus diluted earnings per share of 25 cents on 44,317,000 weighted average shares outstanding for the first quarter of 2005.
“Our first quarter 2006 sales of more than $277 million represent the highest first quarter revenues in our 14-year history,” stated Fred Schneider, chief financial officer of SKECHERS. “We are very pleased with our results, which continue the momentum of our record $1.0 billion in sales for 2005.”
Gross profit for the first quarter of 2006 was $118.4 million compared to $100.4 million for the first quarter of last year. Gross margin was 42.6% for the first quarter of 2006 up 180 basis points compared to 40.8% for the first quarter of 2005.
“The company's record first quarter net sales are a result of double digit sales increases in our domestic wholesale and retail divisions as well as improvements in our international wholesale business. The strong growth within these channels has come from the continued enthusiasm for our trend-right SKECHERS men's, women's and children's product combined with the broader acceptance of our fashion and street lines,” began David Weinberg, SKECHERS' chief operating officer. “These record sales have been achieved with increased profitably and better gross margins, and they resulted in a stronger financial position for the company.”
Robert Greenberg, the company's chief executive officer, commented: “This is a great start to the year: record first quarter sales, a phenomenal product offering that now includes three new lines – Kitson footwear, multi-platinum recording artist The Game's signature 310 line and Siren by Mark Nason – and new print and television advertising campaigns. This growing stable of brands, which now also includes Zoo York Footwear, allows us to reach into nearly every market to meet most consumers' footwear needs. Each has its own reputation and following, and they have become solid businesses. We are very pleased with our firmly established SKECHERS lines and our newer brands, and we believe our great start is a step toward a great year and of more good things to come.”
Mr. Weinberg continued: “We believe the momentum we are seeing will continue into the second quarter based on key indicators including a backlog and strong retail comp sales. Our consistent performance over the past two years combined with our new position as a leading billion dollar brand marks a new era for SKECHERS — one of increased profitability and continued growth.”
The company now expects second quarter 2006 net sales to be in the range of $295 million to $305 million and diluted earnings per share in the range of 41 cents to 46 cents.
