Crocs GAAP revenues up 3.6 percent in Q2

REPORT_ Crocs reported financial results for the second quarter ended June 30, 2014, and announced strategic

plans for long-term improvement and growth of the business. GAAP revenues increased 3.6 percent in the second quarter of 2014 to 376.9 million dollars. On a constant currency basis, revenue increased 3.5 percent in the second quarter of 2014.

GAAP net income per common share was 0.19 dollars, and excluding certain charges, the company reported a non-GAAP net income per common share of 0.36 dollars. “Crocs' performance in the second quarter demonstrates the underlying potential of our global brand and business and the need for dynamic change in our strategy, organization and approach to the market,” said Crocs President Andrew Rees, adding, “Overall, revenue was in line with our expectations, and we have set a course for meaningful change going forward.”

The strategic plans announced by the company comprise of four key initiatives, like streamlining the global product and marketing portfolio, reducing direct investment in smaller geographic markets, creating a more efficient organizational structure including reducing duplicative and excess overhead which will also enhance the decision making process, and closing or converting approximately 75 to 100 Crocs branded retail stores around the world.

The company expects cost savings associated with the reduction in force of 4.0 million dollars in 2014 and 10 million dollars in 2015. Further, the company expects store closings will reduce revenue by approximately 35 to 50 million dollars.

In the second quarter of 2014, the company reported GAAP operating income of 41.9 million dollars compared with 50.4 million dollars in the second quarter of 2013. “Our second quarter 2014 financial results were driven by a number of factors, most significantly strength in our Europe business coupled with a renewed focus on profitability above revenue growth,” said Jeff Lasher, Crocs chief financial officer. The company expects GAAP revenue of approximately 300 to 305 million dollars in the third quarter of 2014.