Skechers USA, Inc. saw record sales for its first quarter, with double-digit sales growth in both the domestic retail and wholesale businesses, as well as double-digit sales growth in the international distributor channel. In fact, the only down point for the company was a “slightly down” sales result in the international subsidiary business, which management appeased with backlogs up in double-digits in the channel. Amongst the other brands Skechers owns, the combined kids lines, the 310 brand, Michelle K, and Marc Nason all posted triple-digit growth for the quarter.
Skechers saw Q1 net sales increase 12.7% to $277.6 million over net sales of $246.2 million for the first quarter of 2005. Domestic retail sales were up “more than 11%” for the quarter, marking the eleventh consecutive quarter of double-digit sales increases for the channel. The retail growth was fueled by a high-single-digit comp increase and the addition of 10 new stores.
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 margin improvement was driven by lower levels of close-outs as well as “significant” margin improvements in the fashion lines.
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 versus diluted earnings per share of 25 cents for the first quarter of 2005.
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.
