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Published
Nov 5, 2009
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Crocs surprises with profit; outlook weak

By
Reuters
Published
Nov 5, 2009

NEW YORK, Nov 5 (Reuters) - Crocs Inc (CROX.O) reported a surprise quarterly profit on cost cuts, but forecast what may be a deeper than expected loss in the current quarter, and its shares fell 10 percent.



"While we are encouraged by our top-line growth and return to profitability in the quarter, the normal seasonality of our business will make it difficult to maintain profitability in the fourth quarter," CEO John Duerden said in a statement.

The seller of the once-trendy colorful plastic shoes has been trying to trim costs and write down inventory. It has also had to shed staff and close factories while coping with the inventory overhang and cash crunch earlier this year.

Crocs' vibrant resin shoes were the rage midway through the decade. But the company found its operations out of line with reduced sales volume due to the economic downturn and shoppers' waning interest as the brands' novelty wears off.

The company, however, said it saw strong future wholesale bookings for its spring 2010 line in all regions and has "increased confidence" that it will return to profitability during 2010.

Net income at Crocs was $22.1 million, or 25 cents a share in the third quarter, compared with a net loss of $148.0 million, or $1.79 a share, a year earlier.

Excluding items, Crocs earned 1 cent a share. Analysts on average were expecting a loss of 8 cents a share, according to Thomson Reuters I/B/E/S.

Revenue rose 1.7 percent to $177.1 million.

In the fourth quarter, Crocs sees a loss of 15 cents a share to 20 cents a share, excluding items. Analysts on average were expecting a loss of 16 cents a share.

Crocs shares were down about 10 percent at $6.17 in after-hours trade. (Reporting by Dhanya Skariachan; Editing by Tim Dobbyn, Phil Berlowitz)

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