Wolverine World Wide, Inc. reported revenues in its third quarter ended Sept. 6 grew 2.8% to $318.9 million from $310.2 million in the prior year, led by a high-single gain for the Merrell brand. Earnings rose 5.8% to $31.2 million, or 62 cents a share, from $29.5 million, or 54 cents, a year ago.


The company also said that based on the strength of reported third quarter results and its diversified global business model, it is raising its full-year earnings guidance to a range of $1.87 to $1.92 per fully diluted share on a revised revenue range of $1.22 to $1.24 billion. The revised earnings per share range represents growth of 10% to 13% over 2007 earnings per share of $1.70.

 

In reporting its second quarter results, the company forecast full year 2008 revenues of $1.23 to $1.26 billion and its earnings per share range of $1.83 to $1.90, representing growth of 7.6% to 11.8% over the $1.70 reported for 2007.

“We are pleased to report strong results for the third quarter, particularly in light of continuing tough global economic conditions. Our team’s focused execution against our multi-brand, multi-country and multi-category brand-building model enables us to consistently post excellent financial results. The company’s financial performance in the quarter was highlighted by the Merrell brand, which delivered a high single-digit revenue gain and a double-digit increase in earnings contribution,” said president and CEO Blake W. Krueger.


CFO Don Grimes commented, “Operating margin of 14.5% in the quarter is a 22 basis point improvement over the prior year, and was driven by modest gross margin expansion and operating expense leverage. Inventory levels were down 2.1% for the quarter, while accounts receivable increased 2.1% on the 2.8% revenue increase. The company repurchased approximately 745,000 shares of stock in the quarter for $19.0 million, and ended the third quarter with a cash balance of $74.3 million. The company’s balance sheet remains one of the strongest in the industry.”


For the first three quarters of 2008, revenue reached $874.5 million, a 3.9% gain over the $841.5 million reported for the first three quarters of 2007. Year-to-date reported earnings per share were $1.41 per share, up 16.4% from $1.21 per share for the same period of 2007.

                          WOLVERINE WORLD WIDE, INC.

                    CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (Unaudited)
                       ($000’s, except per share data)

                             12 Weeks Ended            36 Weeks Ended
                         September 6, September 8, September 6, September 8,
                             2008         2007        2008         2007
    Revenue               $318,852     $310,168     $874,452     $841,549
    Cost of products sold  190,122      185,216      521,762      507,068
      Gross profit         128,730      124,952      352,690      334,481
      Gross margin            40.4%        40.3%        40.3%        39.7%

    Selling and
     administrative
     expenses               82,389       80,548      244,192      233,845
      Operating profit      46,341       44,404      108,498      100,636
      Operating margin        14.5%        14.3%        12.4%        12.0%

    Interest (income)
     expense, net              309         (179)         674         (973)
    Other (income) expense    (880)         252           (1)         424
                              (571)          73          673         (549)
    Earnings before income
     taxes                  46,912       44,331      107,825      101,185

    Income taxes            15,721       14,848       36,121       33,895

    Net earnings           $31,191      $29,483      $71,704      $67,290

    Diluted earnings per
     share                    $.62         $.54        $1.41        $1.21