Deckers revenue growth propelled by Ugg and Hoka One One
Goleta, California-based footwear group Deckers Brands announced a 7.8% increase in net sales in the third quarter of 2019 on Thursday, with progress led by the company’s Ugg and Hoka One One brands.
The company’s total net sales for the third quarter ended December 31, 2018, came to $873.8 million, up from $810.5 million in the prior-year period.
Sales at Ugg increased 3.6% to $761.0 million, compared to $734.7 million in the same period in the previous year, while the Hoka One One label saw its sales skyrocket a staggering 79.2% to $56.9 million. Deckers’ Teva brand also saw strong growth of 17.5% to achieve sales of $22.9 million, while Sanuk fared less well, posting a decline of 7.0% to $12.9 million.
In terms of its distribution channels, revenues in the company’s wholesale division increased 12.5% to $482.2 million in Q3, while direct-to-consumer (DTC) sales rose 2.6% to $391.6 million. DTC comparable sales increased 1.4%.
Deckers also had more success in its home market than abroad in the quarter, reporting an increase of 14.2% in domestic sales, which totaled $573.0 million, while international sales fell 2.6% to $300.8 million.
The company’s net income for the quarter totaled $196.4 million, compared to $86.3 million in the prior year period. Diluted earnings per share (EPS) rose to $6.68 from $2.69.
In light of its better-than-expected results, Deckers has raised its guidance for the full fiscal year 2019. The company now expects net sales to be between $1.986 billion and $2.0 billion, while non-GAAP diluted EPS – excluding charges related to possible store closures, tax reforms, organizational changes and other non-recurring expenses – are now expected to be in the range of $7.85 to $7.95.
“With third quarter results delivered and an updated outlook for the full fiscal year 2019, I am pleased to say that we are now well ahead of schedule to deliver on the long term strategic goals we laid out two years ago,” said Deckers President and CEO Dave Powers in a press release.
The company’s Q4 net sales are now expected to be between $360.0 million and $374.0 million.
Following the announcement of the company’s results, shares in Deckers rose 6% in the extended session on Thursday, according to figures cited by MarketWatch.
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