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DECKERS BRANDS REPORTS THIRD QUARTER FISCAL 2024 FINANCIAL RESULTS

  • THIRD QUARTER FY 2024 REVENUE INCREASED 16% TO A RECORD $1.56 BILLION

  • THIRD QUARTER FY 2024 DILUTED EPS INCREASED 44% TO A RECORD $15.11

  • FY 2024 REVENUE GUIDANCE RAISED TO APPROXIMATELY $4.15 BILLION, 14% ABOVE PRIOR YEAR

  • FY 2024 DILUTED EPS GUIDANCE RAISED TO RANGE OF $26.25-$26.50, APPROXIMATELY 36% ABOVE PRIOR YEAR

GOLETA, Calif., Feb. 1, 2024 /PRNewswire/ -- Deckers Brands (NYSE: DECK), a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories, today announced financial results for the third fiscal quarter ended December 31, 2023. The Company also provided an update to its financial outlook for the full fiscal year ending March 31, 2024.

"Our brands delivered Deckers' largest quarter in history, with record revenue and earnings as both HOKA and UGG drove exceptional performance in the quarter, led by our DTC channel and high levels of full price selling," said Dave Powers, President and Chief Executive Officer. "Global gains in awareness, combined with elevated consumer connections and innovative product offerings, continued to drive unparalleled demand for our brands. This, coupled with our disciplined operating approach, dedicated focus on marketplace management and fortified balance sheet, puts Deckers in a position of strength as we enter our last fiscal quarter of 2024. We believe HOKA and UGG are two of the healthiest brands in the industry and we remain focused on executing against our strategic initiatives to drive long-term future success."

Third Quarter Fiscal 2024 Financial Review (Compared to the Same Period Last Year)

  • Net sales increased 16.0% to $1.560 billion compared to $1.346 billion. On a constant currency basis, net sales increased 15.1%.

    • Channel

      • Direct-to-Consumer (DTC) net sales increased 22.7% to $858.1 million compared to $699.3 million. DTC comparable net sales increased 21.8%.

      • Wholesale net sales increased 8.6% to $702.2 million compared to $646.3 million.

    • Geography

      • Domestic net sales increased 15.6% to $1.048 billion compared to $906.8 million.

      • International net sales increased 16.7% to $511.9 million compared to $438.8 million.

  • Gross margin was 58.7% compared to 53.0%.

  • Selling, general, and administrative (SG&A) expenses were $428.7 million compared to $349.9 million.

  • Operating income was $487.9 million compared to $362.7 million.

  • Diluted earnings per share was $15.11 compared to $10.48.

Third Quarter Fiscal 2024 Brand Summary (Compared to the Same Period Last Year)

  • UGG® brand net sales increased 15.2% to $1.072 billion compared to $930.4 million.

  • HOKA® brand net sales increased 21.9% to $429.3 million compared to $352.1 million.

  • Teva® brand net sales decreased 16.2% to $25.6 million compared to $30.5 million.

  • Sanuk® brand net sales decreased 28.9% to $4.0 million compared to $5.6 million.

  • Other brands, primarily composed of Koolaburra®, net sales increased 10.0% to $29.6 million compared to $26.9 million.

Balance Sheet (December 31, 2023 as compared to December 31, 2022)

  • Cash and cash equivalents were $1.651 billion compared to $1.058 billion.

  • Inventories were $539.0 million compared to $723.4 million.

  • The Company had no outstanding borrowings.

Stock Repurchase Program

During the third fiscal quarter, the Company repurchased approximately 196 thousand shares of its common stock for a total of $99.7 million at a weighted average price paid per share of $507.95. As of December 31, 2023, the Company had approximately $1.046 billion remaining under its stock repurchase authorization.

Full Fiscal Year 2024 Outlook for the Twelve Month Period Ending March 31, 2024

The Company's full fiscal year 2024 outlook is forward-looking in nature, reflecting our expectations as of February 1, 2024, and is subject to significant risks and uncertainties that limit our ability to accurately forecast results. This outlook assumes no meaningful changes to the Company's business prospects or risks and uncertainties identified by management that could impact future results, which include but are not limited to: changes in economic conditions, including consumer confidence and discretionary spending, inflationary pressures, and foreign currency fluctuation; geopolitical tensions; and supply chain disruptions, constraints and related expenses.

  • Net sales are now expected to be approximately $4.15 billion.

  • Gross margin is now expected to be approximately 54.5%.

  • SG&A expenses as a percentage of net sales are now expected to be approximately 34.5%.

  • Operating margin is now expected to be approximately 20%.

  • Effective tax rate is now expected to be approximately 22%.

  • Diluted earnings per share is now expected to be in the range of $26.25 to $26.50.

  • The earnings per share guidance does not assume any impact from potential future share repurchases.

Non-GAAP Financial Measures

In certain instances the Company may present financial measures that were not prepared in accordance with generally accepted accounting principles in the United States (non-GAAP financial measures), including constant currency, to provide information that may assist investors in understanding its financial results and assessing its prospects for future performance. The Company believes these non-GAAP financial measures are important indicators of its operating performance because they exclude items that are unrelated to, and may not be indicative of, its core operating results.

The non-GAAP financial measures presented by the Company may not necessarily be comparable to similarly titled measures of other companies and may not be appropriate measures for comparing the performance of other companies relative to Deckers. For example, in order to calculate constant currency information, the Company calculates the current period financial information using the foreign currency exchange rates that were in effect during the previous comparable period, excluding the effects of foreign currency exchange rate hedges and remeasurements in the condensed consolidated financial statements. Further, the Company reports DTC comparable net sales on a constant currency basis for DTC operations that were open throughout the current and prior reporting periods, and may adjust prior reporting periods to conform to current year accounting policies. These non-GAAP financial measures are not intended to represent, and should not be considered to be more meaningful measures than, or alternatives to, measures of operating performance as determined in accordance with GAAP. To the extent the Company utilizes such non-GAAP financial measures in the future, it expects to calculate them using a consistent method from period-to-period.

Conference Call Information

The Company's conference call to review the results for the third quarter fiscal year 2024 will be broadcast live today, Thursday, February 1, 2024, at 4:30 pm Eastern Time and hosted at ir.deckers.com. You can access the broadcast by clicking on the link within the "Webcast" box at the top of the page. A replay of the broadcast will be available for at least 30 days following the conference call and can be accessed under the "Quarterly Earnings" section of the "Financials" tab at the aforementioned website.

About Deckers Brands

Deckers Brands is a global leader in designing, marketing, and distributing innovative footwear, apparel, and accessories developed for both everyday casual lifestyle use and high-performance activities. The Company's portfolio of brands includes UGG®, HOKA®, Teva®, Sanuk®, and Koolaburra®. Deckers Brands products are sold in more than 50 countries and territories through select department and specialty stores, Company-owned and operated retail stores, and select online stores, including Company-owned websites. Deckers Brands has 50 years of history building niche footwear brands into lifestyle market leaders attracting millions of loyal consumers globally. For more information, please visit www.deckers.com.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, which statements are subject to considerable risks and uncertainties. Forward-looking statements include all statements other than statements of historical fact contained in this press release, including statements regarding our projected financial results, including net sales, gross margin, SG&A expenses, operating margin, inventories, effective tax rate, and diluted earnings per share; consumer confidence and discretionary spending; the strength of our brands and demand for our products; our ability to drive future growth and profitability; our ability to execute on our long-term strategies and objectives; and our potential repurchase of shares. We have attempted to identify forward-looking statements by using words such as "anticipate," "believe," "estimate," "intend," "may," "plan," "predict," "project," "should," "will," or "would," and similar expressions or the negative of these expressions.

Forward-looking statements represent our management's current expectations and predictions about trends affecting our business and industry and are based on information available as of the time such statements are made. Although we do not make forward-looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy or completeness. Forward-looking statements involve numerous known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements predicted, assumed or implied by the forward-looking statements. Some of the risks and uncertainties that may cause our actual results to materially differ from those expressed or implied by these forward-looking statements are described in the section entitled "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023, as well as in our Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. Except as required by applicable law or the listing rules of the New York Stock Exchange, we expressly disclaim any intent or obligation to update any forward-looking statements, or to update the reasons actual results could differ materially from those expressed or implied by these forward-looking statements, whether to conform such statements to actual results or changes in our expectations, or as a result of the availability of new information.

 

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(dollar and share data amounts in thousands, except per share data)



Three Months Ended December 31,


Nine Months Ended December 31,


2023


2022


2023


2022

Net sales

$           1,560,307


$           1,345,640


$     3,328,005


$     2,835,715

Cost of sales

643,738


633,111


1,481,993


1,406,513

Gross profit

916,569


712,529


1,846,012


1,429,202

Selling, general, and administrative expenses

428,670


349,869


1,062,760


882,370

Income from operations

487,899


362,660


783,252


546,832

Total other income, net

(11,154)


(2,644)


(31,482)


(4,392)

Income before income taxes

499,053


365,304


814,734


551,224

Income tax expense

109,134


86,642


182,716


126,189

Net income

389,919


278,662


632,018


425,035

Total other comprehensive income (loss), net of tax

7,077


12,086


(3,339)


(15,321)

Comprehensive income

$              396,996


$              290,748


$       628,679


$       409,714









Net income per share








Basic

$                  15.19


$                  10.55


$           24.35


$           16.00

Diluted

$                  15.11


$                  10.48


$           24.20


$           15.90

Weighted-average common shares outstanding








Basic

25,664


26,418


25,953


26,570

Diluted

25,811


26,586


26,114


26,740

 

DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(dollar amounts in thousands)



December 31, 2023


March 31, 2023

ASSETS



(AUDITED)

Current assets




Cash and cash equivalents

$           1,650,802


$              981,795

Trade accounts receivable, net

331,677


301,511

Inventories

538,963


532,852

Other current assets

127,412


94,095

Total current assets

2,648,854


1,910,253

Property and equipment, net

300,815


266,679

Operating lease assets

232,179


213,302

Other noncurrent assets

165,611


165,969

Total assets

$           3,347,459


$           2,556,203





LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities




Trade accounts payable

$              507,161


$              265,605

Operating lease liabilities

51,124


50,765

Other current liabilities

369,157


181,010

Total current liabilities

927,442


497,380

Long-term operating lease liabilities

222,867


195,723

Other long-term liabilities

92,960


97,367

Total long-term liabilities

315,827


293,090

Total stockholders' equity

2,104,190


1,765,733

Total liabilities and stockholders' equity

$           3,347,459


$           2,556,203

 

Deckers Brands Logo (PRNewsfoto/Deckers Brands)
Deckers Brands Logo (PRNewsfoto/Deckers Brands)

 

Cision
Cision

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SOURCE Deckers Brands

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