FEBRUARY 02, 2005 -- Wolverine Posts Record Sales & Earnings
Wolverine World Wide achieved record revenue totaling $991.9 million for FY04, an 11.6% increase over FY03 revenue. For 4Q04, the company reported revenue of $307.4 million, an 8.7% increase over 4Q03. EPS, on a pre-split basis, for FY04 grew to $1.64, a 29.1% increase over the $1.27 per share reported in 2003. 4Q04 EPS increased to 52¢, a 13.0% increase over 4Q03 EPS of 46¢. Wall Street had been expecting EPS of 50¢. "Wolverine World Wide had an exceptional 2004 as evidenced by the company's strong financial performance," stated Timothy O'Donovan, president/CEO. "All of our operating groups experienced double-digit profit improvements during the year with the Merrell business leading the way as it achieved strong double-digit sales gains and was the top earnings producer for the business."
O'Donovan concluded, "Our 2004 year-end backlog is up more than 13% over prior year-end levels. This solid backlog position is a testament to the strength of the product initiatives across all of our brands and the retailer and consumer excitement surrounding our Spring/Summer product offerings. Looking ahead to 2005, we are one step closer to realizing our vision of becoming the world's premier non-athletic footwear company as we anticipate crossing the $1.0 billion mark in revenue for the first time in the company's history.
"We are increasing our previously stated 2005 estimates to a range of $1.040 to $1.060 billion and are increasing pre-split EPS by 2¢ per share to a range of $1.79 to $1.86. These estimates are in line with our previously stated long-term financial objectives of growing revenue in the mid to upper single-digit range and generating double-digit EPS growth. On a post-split basis, 2005 EPS estimates range from $1.19 to $1.24. These estimates do not include the effect of accounting changes which require the expensing of stock options and do not reflect any impact from the potential repatriation of foreign earnings under the American Jobs Creation Act of 2004."
11,000 Snowboard Bindings Being Recalled
Abount 11,000 Rossignol and Dynastar snowboard bindings are being recalled in cooperation with the CPSC. The baseplate of the binding can break, resulting in loss of control and possible fall and injury to the snowboarder. There have been reports of 23 broken bindings. No injuries have been reported. This recall includes all 2003/2004 model year Rossignol-brand HC 500, Zena, Unit Pack, HC Rental, and Unit Rental snowboard bindings. Also included are the 2003/2004 model year Dynastar-brand Classic RL and Classic Pack snowboard bindings. This recall does not involve current products (2004-2005) or other models. They were sold at sporting goods stores, and ski and snowboard rental shops nationwide from October 2003 through December 2003 for about $130.
Skechers Has Brighter Picture
Skechers pre-announced that it is expecting 4Q04 revenues to be in excess of $200 million, which will be at least 8% above the high end of the company's previous guidance of $175 million to $185 million. Skechers further expects 4Q EPS to be better than the previous guidance of a loss of 7¢-12¢ and the First Call consensus of a 6¢ loss. Susquehanna Financial reiterated its net positive rating on Skechers and increased its 4Q04 estimate to flat from a loss of 6¢. Its FY05 estimate was raised to revenues of $981.5 million from $958.5 million and EPS to 87¢ from 83¢.
Fleet Feet Sales Up 19% In 2004
Fleet Feet's 61 stores recorded a 19.4% growth in overall sales in 2004, surpassing $43 million in revenue. Comp-stores sales in 2004 were up 12.4% over 2003. "Given the competitive climate in retail in this country, especially in sporting goods, we are extremely pleased with Fleet Feet's performance in 2004," said Fleet Feet president Jeff Phillips. "Every owner of a Fleet Feet store is intricately involved in the daily operations of his/her business and the care of customers each day. Our continually impressive results prove that our hands-on, customer-focused model is a success."
Fleet Feet recorded its first ever $4 million-month in July 2004, followed by two more record-breaking months in August and September. Of the 10 best sales months in Fleet Feet's 28-year history, eight of these occurred in 2004.
Thirteen new Fleet Feet stores opened for business in 2004 in nine states including five new stores in California. Fleet Feet gained presence in Southern California with the opening of stores in Laguna Niguel and Santa Monica. Stores also opened in Bonney Lake, WA and Columbus, OH in 4Q. Planned new store openings for 1H05 include Hickory, NC; Gaithersburg, MD; Stockton, CA; Madison, WI; and Kailua, HI.
"All of the stores opened in 2004 have been implementing our Person FIT Process with resounding success," explained Phillips. "We have 'packaged' our breadth and depth of experience in fitting running shoes into our Personal FIT Process. Along with our commitment to superior customer service and community involvement, we are seeing consistent success across the Fleet Feet organization."
Susquehanna Financial initiated coverage of Adidas-Salomon with a net positive rating.
