Crocs posts strong earnings gains in first quarter
Niwot, Colorado-based footwear company Crocs, Inc. reported net income of $24.7 million (or $0.33 per diluted share) in the first quarter ended March 31, 201, a significant improvement compared to the $12.5 million ($0.15 per diluted share) reported in the prior-year period, thanks to expectation-topping revenues and successful cost-cutting measures.
Crocs’ quarterly revenues totaled $295.9 million, up 4.5% (9.0% in constant currencies) from $283.1 million in Q1 2018, despite the negative impact of store closures and changes to the company’s business model, which resulted in a reduction of around $6 million in sales.
Growth was driven largely by the brand’s e-commerce channel, which posted a 16.5% increase in revenues, while retail comps rose 8.7% and wholesale revenues grew 5.2%.
Over the course of the quarter, Crocs also managed to reduce its selling, general and administrative expenses from $114.0 million in Q1 2018 to $105.0 million through its SG&A reduction program.
“2019 is off to a great start,” said Crocs President and CEO Andrew Rees. “Revenues exceeded expectations as demand for our product and excitement around the brand continued to yield accelerated sell-throughs. We were particularly pleased with the exceptional direct to consumer performance successfully comping an earlier Easter last year.”
Looking to the second quarter, the company expects to report revenues of between $350 and $360 million, up from $328.0 million in the second quarter of 2018, while full-year revenues are predicted to increase between 5% and 7% compared to 2018’s total of $1.1 billion.
In April, Crocs, which is gaining something of a reputation for high-profile – and on occasion unexpected – partnerships, having previously signed off on collaborations with everyone from luxury fashion label Balenciaga to Hollywood actress Drew Barrymore and rapper Post Malone, launched the third year of its “Comes As You Are” campaign.
In line with the company’s current celebrity focus, this year’s campaign features a clutch of A-list global brand ambassadors, including American actress and singer-songwriter Zooey Deschanel, British actress Natalie Dormer, Chinese actress and model Gina Jin, South Korean actress and performer Kim Se-Jeong and Japanese actress and model Suzu Hirose.
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