Steve Madden reports increase in Q4 sales and profit

Steve Madden’s fourth quarter revenue increased 0.7 percent to 419.6 million dollars. The company said in a statement, gross margin was 37.7 percent compared to 38.1 percent in the same period last year, while adjusted gross margin was 37.8 percent in 2019. Net income attributable to Steven Madden, Ltd. was 17.8 million dollars or 21 cents per diluted share compared to 12.5 million dollars or 15 cents per diluted share, in the prior year’s fourth quarter. The company added, adjusted net income attributable to Steven Madden, Ltd. was 32.2 million dollars or 39 cents per diluted share, compared to 35.7 million dollars or 42 cents per diluted share, in the prior year’s fourth quarter.

Commenting on the trading update, Edward Rosenfeld, Steve Madden’s Chairman and Chief Executive Officer, said: “Fiscal year 2019 was a strong year for the company, with revenue and adjusted diluted EPS increased mid-single digits on a percentage basis compared to the prior year despite significant headwinds from the bankruptcy of Payless ShoeSource and the tariffs implemented on accessories, footwear and apparel from China. Looking ahead, while we are cautious on the near-term outlook due to additional headwinds from the coronavirus outbreak, China tariffs and the termination of the Kate Spade footwear license.”

Review of Steve Madden’s Q4 and full year results

Revenue for the wholesale business decreased 1.1 percent to 313.8 million dollars in the fourth quarter of 2019 due primarily to a decrease in wholesale accessories/apparel revenue, while wholesale footwear revenue declined 0.2 percent with a decline in the branded business offset by a gain in private label and wholesale accessories/apparel revenue decreased 3.6 percent driven by declines in private label handbags and cold weather accessories, partially offset by the addition of the BB Dakota apparel business. Gross margin in the wholesale business decreased to 29.2 percent.

Retail revenue in the fourth quarter rose 8.7 percent to 101.1 million dollars, while same store sales increased 6.7 percent in the quarter driven by strong performance in the company’s e-commerce business. Retail gross margin was 61.2 percent compared to 61 percent in last year's fourth quarter, while adjusted gross margin in the retail segment increased to 61.6 percent. The company ended the quarter with 227 company-operated retail locations, including eight Internet stores, as well as 31 company-operated concessions in international markets.

For the full year ended December 31, 2019, revenue increased 6.5 percent to 1.8 billion dollars and net income attributable to Steven Madden, Ltd. was 141.3 million dollars or 1.69 dollars compared to 129.1 million dollars or 1.50 dollars per diluted share, for the year ended December 31, 2018. On an Adjusted basis, net income attributable to Steven Madden, Ltd. was 162.8 million dollars or 1.95 dollars per diluted share compared to 157.7 million dollars or 1.83 dollars per diluted share, for the year ended December 31, 2018.

Steve Madden expects marginal improvement in 2020 revenues

For fiscal year 2020, the company expects revenue will increase 0 to 1 percent over revenue in 2019 and diluted EPS for fiscal year 2020 will be in the range of 1.70 dollars to 1.80 dollars. Compared to the prior year, the diluted EPS range reflects an adverse impact of approximately 35 cents from the combined impact of the coronavirus, tariffs on goods from China, the termination of the Kate Spade footwear license and a higher anticipated tax rate.

The company’s board of directors approved a quarterly cash dividend of 15 cents per share, which will be paid on March 27, 2020, to stockholders of record at the close of business on March 17, 2020.

Picture:Facebook/Steve Madden