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Crocs Inc. continues to buck the downward trend in retail brought about by the coronavirus pandemic.
For the third quarter, the clog maker reported adjusted earnings of 94 cents per share, while last year’s EPS amounted to 57 cents. Wall Street had been anticipating earnings of 69 cents. Revenues increased 15.7% to $361.7 million, versus analysts’ forecasts of $339.6 million.
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According to the company, digital sales — including those made through company-owned websites, third-party marketplaces and e-tailers — grew 35.5%, representing 37.7% of revenues compared with the prior year’s 32.2% share. E-commerce rose 36.3% to $80 million, while retail revenues ascended 8.9% to $117.2 million and the wholesale business improved 12.4% to $164.5 million. Direct-to-consumer sales recorded a 23.8% hike, versus 15.9% for the same period last year.
In the Americas, revenues jumped 27.3% to $234 million, while sales in the Europe-Middle East-Africa region climbed 10.7% to $60 million. However, the Asia-Pacific area saw a 9% decline in revenues to $67.7 million.
“We achieved record third-quarter revenue and EPS despite the challenges presented by the global COVID-19 pandemic,” CEO Andrew Rees said in a statement. “Our extraordinary performance and strong cash flow generation demonstrates the strength of the Crocs brand and product offering globally. I am tremendously proud of how we have executed as a team and am excited for our future.”
Early into the health crisis, in March, leaders at the Niwot, Colo.-based firm began to implement their “defensive and offensive playbook” to help counter the predicted negative impact on its business. By the second quarter, those defensive measures had been completed, and its offensive action had “started to show results,” it said in late July.
While many of its brick-and-mortar stores were closed for months, Crocs.com and the company’s other digital platforms remained in operation. Analysts have remarked that the brand’s trend-right casual product, close connection with consumers and focus on digital have continued to pay off.
At the end of the third quarter, Crocs had $123.6 million in cash and equivalents, plus $364.4 million in available borrowing capacity. Excluding the potential impact of the coronavirus outbreak, the brand expects fourth-quarter sales to grow between 20% and 30%, translating into full-year revenue growth of roughly 5% to 7%.