Wolverine World Wide, Inc. second quarter 2007 revenue totaled $250.3 million, a 5.0% increase over second quarter 2006 revenue of $238.5 million. Earnings per share for the second quarter of 2007 were 28 cents compared to the 25 cents reported for the second quarter of 2006, an increase of 12.0%. Merrell was said to have double digit earnings and revenue growth during the quarter.
For the first half of 2007, revenue reached $531.4 million, a 6.0% gain over the $501.3 million reported for the first half of 2006. Earnings per share for the first half of 2007 grew to 67 cents per share, up 13.6% from 59 cents per share for the same period of 2006.
Blake W. Krueger, the Company's CEO and President commented, “We are pleased to report another record quarter for the Company, achieving our 20th consecutive quarter of both record revenue and earnings per share. Our strong performance in the quarter was broad-based across our branded footwear groups, with the Merrell brand leading the way with strong double-digit gains in both revenue and earnings. Both the Heritage Brands Group and Hush Puppies business also realized solid revenue and earnings gains in the quarter. Planned decreases in the military contract and private label businesses offset other revenue gains in the Wolverine Footwear Group during the quarter.
“We are encouraged by the Company's record performance in the first half of 2007. Our business model of operating multiple brands across diverse global markets and distribution channels continues to exceed expectations. Our innovative product offerings remain in demand and are being embraced by the global consumer.”
According to Stephen L. Gulis Jr., the Company's CFO, “Second quarter 2007 gross margin of 38.2% improved 30 basis points over second quarter 2006. Selling and administrative expense as a percentage of revenue was reduced 10 basis points, reflecting a tight control on expenses.
“Strong inventory management programs led to further strengthening of our balance sheet in the second quarter. Inventory levels were down 1.0 percent compared to last year while accounts receivable were up 2.3 percent on revenue growth of 5.0 percent for the quarter. During the quarter, we repurchased 1.2 million shares of stock for $34.4 million and the Company ended the second quarter with a cash balance of $77.0 million.”
Krueger concluded, “Continued consumer enthusiasm for our global lifestyle brands is reflected in our order backlog which was up more than 6 percent at the end of the second quarter compared to the second quarter of 2006. On the strength of our operating results, we are increasing the Company's 2007 earnings per share estimate to $1.60 to $1.64, up from our previous estimate of $1.57 to $1.63. We are maintaining our revenue guidance with full-year 2007 revenue expected to be at the lower end of our previously announced range of $1.200 to $1.230 billion. These estimates are consistent with our stated long-term objectives of growing annual revenue in the mid to upper-single digit range and delivering double-digit earnings per share growth while investing in initiatives for the future.”
WOLVERINE WORLD WIDE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
($000's, except per share data)
12 Weeks Ended 24 Weeks Ended
June 16, June 17, June 16, June 17,
2007 2006 2007 2006
Revenue $ 250,329 $ 238,457 $ 531,381 $ 501,296
Cost of products
sold 154,801 148,052 321,852 305,016
Gross margin 95,528 90,405 209,529 196,280
Selling and
administrative
expenses 71,962 68,737 153,297 144,984
Operating margin 23,566 21,668 56,232 51,296
Interest (income)
expense, net (104) 29 (795) 138
Other expense, net 332 331 172 465
228 360 (623) 603
Earnings before
income taxes 23,338 21,308 56,855 50,693
Income taxes 7,820 7,074 19,047 16,830
Net earnings $ 15,518 $ 14,234 $ 37,808 $ 33,863
Diluted earnings
per share $ .28 $ .25 $ .67 $ .59
