Skechers stock is running higher after the athletic shoe brand delivered record earnings for the second quarter. Shares jumped over 11 percent to trade at $142 after Skechers reported net sales of $800.5 million, much higher than last year’s $587.1 million for the same period. Net profit came in at $1.55 a share, a 128 percent increase over last year’s 68 cents per share. Analysts had only expected profits of $1.01 a share on revenue of $736.4 million.
On the conference call when asked about the sales, CEO Robert Greenberg said that the big increase was due to a mix of new product and higher prices, but mostly products like Skechers Go that grew at a significantly faster pace.
Skechers is now the number-one walking brand and the number-two athletic footwear brand in the U.S. “The continued strong demand for our product worldwide led to record quarterly financial results for the second quarter — including net sales, earnings from operations and earnings per share,” said CFO David Weinberg in a company statement.
He went on to say, “The second quarter benefited from both pent-up demand resulting from U.S. port issues in the first quarter as well as a shift in back-to-school shipments due to increased demand in both domestic and international markets. Our international subsidiary business also remained strong with double-digit increases despite currency headwinds in several key markets.”
The domestic wholesale business accounts for 42 percent of the business, but international grew by 60 percent and now accounts for 30 percent of total sales. New markets included the Czech Republic and Nigeria. Volume in China could pick up in 2016 if some deals emerge.
Skechers said it believes that the accelerated growth trend will continue through 2015 and into 2016. Weinberg also said in the company statement, “With increased year-over-year backlogs at the end of June, strong incoming order rates and July sales, as well as the positive sell-through reports from wholesale and an additional 125 to 135 Company-owned and third-party-owned Skechers retail stores planned to open later this year, we believe that we will continue to achieve new sales and profit records through 2015.”