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» Steve Madden, Ltd. Q1 2010 Earnings Call Transcript
» Steve Madden, Ltd. Q2 2009 Earnings Call Transcript
» Steve Madden, Ltd. Q1 2009 Earnings Call Transcript
I would now like to turn the call over to Ed Rosenfeld, Chairman and CEO of Steve Madden.Ed Rosenfeld Thanks, Jean. Good morning and thank you for joining us today. We are very pleased to report that we delivered the highest sales and earnings results in the company's history in the second quarter. During the quarter, consolidated net sales increased 36% to $158.7 million and net income grew to $19.8 million, a 63% increase compared to the second quarter of last year. Our performance reflects strong momentum in our core business, as well as significant contributions from our newer business ventures. On the wholesale side, we achieved strong gains in our core Steve Madden Women's, Steven by Steve Madden, and Madden Girl wholesale footwear divisions. We also continued to see outstanding growth from our Men's business with a substantial increase in our Steve Madden Men's division, supplemented by a strong contribution from our new men's brand, Madden. International also accelerated, recording top line growth in excess of 50%, driven by big year-over-year increases with our existing partners in Asia and Canada, as well as incremental business with new partners in Israel and Australia. Whole accessories was another bright spot with a 79% net sales increase, resulting from 18% organic growth in addition to the sales contributions from our two recent acquisitions, Madden Zone and Big Buddha. I am very pleased with these acquisitions, both of which are exceeding expectations for sales and earnings. Meanwhile, our retail business delivered increased profitability for the sixth straight quarter, driven by a 7.4% comp store sales growth and 350 basis points of gross margin expansion. Overall, we believe that our ability to deliver outstanding growth in a still challenging retail environment demonstrates the unique capabilities of Steve and his design team; strength of our brand portfolio; benefits of our diversification by channel, product, and category; and the resiliency of our business model.
Turning to the details of our financial results for the quarter. As I said [ph], consolidated net sales for the second quarter of fiscal 2010 were $158.7 million, a 36% increase over the second quarter of 2009.Wholesale net sales increased 46% to $129.2 million compared to $88.2 million in the second quarter of 2009, driven by gains in both our wholesale footwear and accessories divisions. Wholesale footwear net sales increased 40% in the second quarter to $104.2 million compared to $74.2 million last year. This increase was driven by solid gains across all existing wholesale footwear divisions, as well as contributions from our new men's brand, Madden, launched in the fourth quarter of 2009 and the mass-merchant business which transitioned from a buying agency model to a selling agency model this year. Net sales in our wholesale accessories business grew 79% to $25 million in the second quarter of 2010 as compared to $14 million in the second – same quarter last year. As stated earlier, this was a combination of the addition of Madden Zone, acquired in July 2009, and Big Buddha Handbags, acquired in February 2010 with 18% organic growth, driven by the exceptional performance of Steve Madden Handbags and strong growth in private-label belts. In our retail division, net sales increased 4% to $29.5 million versus $28.3 million in last year's second quarter, driven by a comparable store sales increase of 7.4%, offset by 10 net store closings since the beginning of second quarter last year. Comp increases, primarily driven by higher AURs, as a result of a mix shift toward wedges and dress shoes, and away from flat sandals. Sales per square foot grew to $690 at stores opened for the 12 months ended June 30th, 2010 compared to $627 in sales per square foot for stores opened for the 12 months ended June 30th, 2009. Read the rest of this transcript for free on seekingalpha.com