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Skechers Q2 sales increase 127.3 percent

By Prachi Singh

23 Jul 2021

Business

Image: Skechers, Facebook

Second quarter sales at Skechers increased 127.3 percent as a result of a 147.3 percent increase in domestic sales and a 113.7 percent increase in international sales. On a constant currency basis, the company’s total sales increased 117.5 percent.

The company’s gross margin increased 72 basis points to 51.2 percent, earnings from operations increased 262.2 million dollars to 201.2 million dollars, while net earnings were 137.4 million dollars and diluted earnings per share were 88 cents.

“Skechers second quarter financial results exceeded expectations as we achieved record quarterly sales of over 1.6 billion dollars, a 127.3 percent increase over the same period in 2020, and 31.7 percent increase over 2019,” stated David Weinberg, chief operating officer of Skechers.

“We accomplished these financial results even as we continued to face Covid-19 related challenges including delayed shipments and port constraints as well as temporary store closures in some key markets, including India, Canada, and parts of Europe and South America,” Weinberg added.

Highlights of Skechers Q2 performance

The company said in a release that domestic and international growth was driven by increases in both wholesale and direct-to-consumer, as Covid-19 restrictions eased over the prior year.

The company added that sales grew across all segments with increases to domestic wholesale of 205.7 percent, international wholesale of 94.8 percent and direct-to-consumer of 137.8 percent.

International wholesale increases were driven by 150.2 percent growth in the company’s European subsidiaries, led by the United Kingdom and Germany, 50.9 percent growth in China, and 122.3 percent growth in distributor sales. Improvements in direct-to-consumer sales resulted from growth across both domestic and international retail stores, slightly offset by declines in domestic e-commerce sales.

Direct-to-consumer comparable same store sales increased 109.2 percent, driven by an increase of 95.6 percent domestically and 165.2 percent internationally.

Review of Skechers year to date financial results

The company’s year to date sales increased 56.5 percent, while domestic and international sales each grew 56.5 percent with the largest contribution derived from international wholesale growth. On a constant currency basis, the company’s total sales increased 50.9 percent.

The company further said that sales grew across all segments with increases to domestic wholesale of 52.2 percent, international wholesale of 52.3 percent, and direct-to-consumer of 69 percent.

Improvements in international wholesale were the result of growth in China of 88.4 percent and Europe of 32.9 percent. Direct-to-Consumer comparable same store sales increased 54.8 percent, driven by an increase of 59.4 percent domestically and 40.8 percent internationally.

Gross margin increased 308 basis points to 49.5 percent, earnings from operations were 358.9 million dollars, an increase of 375.1 million dollars compared to a loss of 16.2 million dollars in the prior-year period, net earnings were 235.9 million dollars and diluted earnings per share were 1.51 dollars.

For the fiscal year 2021, the company expects to achieve sales between 6.15 billion dollars and 6.25 billion dollars and diluted earnings per share of between 2.55 dollars and 2.65 dollars. Further, for the third quarter, the company expects to achieve sales between 1.60 billion dollars and 1.65 billion dollars and diluted earnings per share of between 70 cents and 75 cents.