Deckers profit, sales miss estimates as demand slows
Jan 30, 2015
Outdoor footwear and apparel manufacturer and retailer Deckers Outdoor Corp cut its full-year forecast as demand for its UGG Australia branded sheepskin shoes slows in the United States.
The company's shares fell 13.7 percent in after-market trading on Thursday.
Deckers cut its sales growth forecast for its UGG Australia shoes and accessories to 11 percent from 15 percent in 2015. The brand accounts for more than 90 percent of total revenue.
The company has been trying to lower its dependence on the popular UGG Classic collection of boots, which are responsible for a majority of sales under the UGG Australia brand.
Sales of Deckers' other major brands, Teva and Sanuk, however, fell in the third quarter.
Deckers said it now expected a full-year profit of $4.58 per share, representing 12.6 percent year-on-year growth, and revenue of $1.8 billion. It had previously forecast profit growth of about 15.8 percent and revenue of $1.825 billion.
Analysts on average had estimated a full-year profit of $4.77 per share and revenue of $1.83 billion.
The company also said it now expected to break even in the current quarter, a significantly bleaker outlook than the 15 cent profit it had forecast earlier.
Deckers' net income rose to $156.7 million, or $4.50 per share, in the quarter ended Dec. 31, from $140.9 million, or $4.04 per share, a year earlier.
Comprehensive net income, which includes losses on foreign currency hedging, rose to $149.4 million from $139 million.
Analysts on average expected a profit of $4.52 per share, according to Thomson Reuters I/B/E/S.
Revenue rose 6.6 percent to $784.6 million, well below the average estimate of $813.7 million, due to slower sales in October and November and a stronger U.S. dollar.
The company gets about a third of its revenue from outside the United States.
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