7:33 AM, Jul 19, 2019 — Shares of Skechers USA (SKX), the third-largest athletic footwear brand in the US, rose in early trade on Friday after the firm said soaring international sales boosted group turnover to a record in the second quarter, setting the stage for a revenue and earnings beat as well as guidance ahead of projections in the next three months.
Sales rose to $1.26 billion during the three months that ended June 30, from $1.13 billion a year ago, comfortably outpacing the $1.22 billion average analyst estimate compiled by Capital IQ.
The company said in its earnings statement late on Thursday that a 10.9% jump in total sales included a 19.8% surge in international business and 1.5% growth in domestic revenue. Higher revenue was accompanied by a net 112 fewer store locations in the quarter just ended, masking twice as many overseas outlet additions versus domestic.
Manhattan Beach, California-based Skechers reported growth in net earnings to $0.49 per diluted share, which is above the $0.29 per diluted share recorded a year earlier and handily beat the $0.33 per share forecast.
“We continued to successfully execute by growing both our international and direct to consumer businesses,” Chief Financial Officer John Vandemore said in the statement. “We are committed to investing in our global infrastructure and operational capabilities to meet consumer demand for the Skechers brand.”
The proposed plan includes the construction of the first distribution center in China, the expansion of North American distribution capabilities, the upgrade of a logistics center in Europe, and the further development of direct-to-consumer offerings in e-commerce and retail stores.
In the near term, Skechers, which has $20.0 million remaining in its share buyback program, expects sales of between $1.325 billion and $1.350 billion in the third quarter, higher than a consensus of $1.310 billion for the third quarter. Diluted earnings per share are anticipated in the range of $0.65 and $0.70 during the period, which are also ahead of the $0.64 per share market estimate.
Shares of the company traded more than 13% higher in trading before the market-open early on Friday.
Companies: Skechers U.S.A., Inc.
Price: 38.60 Price Change: +3.76 Percent Change: +10.79