Wolverine Worldwide expects new downturn in 2016

By

Olivier Guyot

Published
Feb 23, 2016

In 2016, American group Wolverine Worldwide is expecting a shortfall for a second, consecutive fiscal year. The US footwear giant (Sperry Top-Sider, Merrell, Saucony, Keds, etc.) has recently presented the results of its 2015 fiscal year, closed on 2nd January.

Blake Krueger, the group's CEO, highlighted in the report how Wolverine Worldwide, with $2.69 billion (€2.45 billion), achieved a revenue consistent with expectations. Wolverine Worldwide nonetheless experienced a troubled fiscal year. Its revenue fell by 2.5% compared to the previous year, dragged down by unfavourable exchange rates. The group was notably supported by a 20% rise in e-commerce activities.

Despite a minor jump in the last quarter, its profitability was also on the same course. Given an EBIT of $201 million, the operating margin was 7.5% compared to 8.3% a year earlier. EBITDA was $123 million, compared to nearly $134 million in 2014.

The group has recently announced a reorganisation of its operational segments, and is also expecting sales to fall even more in 2016, net of exchange rates adjustments. The management is forecasting a revenue between $2.475 and $2.575 billion, equivalent to a decrease between 4% and 8% compared to 2015.

However, the organisational measures aimed at achieving an omni-channel model are expected to bear fruit in the current fiscal year. For the entire year, the group is forecasting an upswing in operating margin to 8.2%.