Even before Meb Keflezighi won the Boston Marathon wearing a pair of Skechers, a brand not normally associated with running, the footwear company was winning big in the marketplace.
Demand was above and beyond the company’s expectations during the first quarter ended March 31, nearly three weeks before the brand gained notoriety with Meb’s marathon win on April 18. Sales increased 21% to $546.5 million and same store sales increased 5.6%, giving the company its second highest quarterly revenue in its 22 year history. Net income surged to $33 million, or 61 cents a share, from $7.5 million, or 13 cents a share.
"The improvements were achieved despite Easter falling late in April and the extreme cold weather experienced in most of the United States throughout the quarter,” said David Weinberg, Skechers COO and CFO. “The sales results are attributable to double-digit increases in our domestic and international wholesale business, as well as increases in our worldwide company-owned retail business, which achieved a 5.6% comparable quarter net sales increase. With multiple product success stories in our lifestyle, performance and kids’ footwear, the positive reaction to our current products resulted in a gross margin of 44% and an operating margin of 8.8%.”
Skechers opened 10 stores during the first quarter and has plans for another 50 to 60 units during the remainder of the year, along with a robust new product pipeline enjoying a hearty reception from retailers.
"April has started off very strong in terms of order rates, revenues and backlogs, all which have accelerated since year end,” Weinberg said. “This was achieved without impacting our at-once business which remains at the same levels as last year. We believe this positive trend will continue through the second quarter and back half of the year as the demand for our key product initiatives in the United States, Asia, Europe, the Middle East and South America remains very high.”