Strong performance of the legacy and Performance + Lifestyle
Group (PLG) businesses facilitated
Wolverine World Wide Inc
) to post fourth quarter 2012 earnings of 48 cents a share that
zoomed past the Zacks Consensus Estimate of 16 cents and
increased 2.1% year over year. However, including one-time items,
the company reported a loss of 8 cents.
Wolverine, which competes with
Deckers Outdoor Corporation
), reported consolidated net sales of $652.2 million, up 60.5%
year over year but missed the Zacks Consensus Estimate of $655
million. However, excluding revenues from the PLG acquisition,
revenues came in at $432.8 million.
Coming to the operating groups, revenues inched up 1.7% year
over year to $143.5 million for Outdoor, while it increased 7.9%
year over year to $170.8 million for Heritage. Lifestyle group
revenues improved 2.8% to $58.9 million during the quarter.
Besides these groups, revenues derived from the company's other
brands jumped 48.1% to $7.5 million, while business units,
comprising Wolverine retail and leathers, posted a revenue
increase of 53.9% to reach $11.6 million.
Revenues from PLG group came in at $150.2 million during the
quarter, while retail revenues (including PLG's direct to
consumer business) came in at $109.7 million.
Gross profit (including PLG acquisition) jumped 59.4% year
over year to $239.3 million during the quarter, whereas gross
margin contracted 20 basis points to 36.7%.
Operating profit, including one-time items (acquisition
related costs), came in at $7.6 million, plummeting from $30.9
million in the comparable prior-year period, while operating
margin decreased to 1.2% from 7.6% in the year-ago quarter.
During the quarter, Wolverine sealed the previously announced
acquisition of Collective Brands' Performance + Lifestyle Group
(PLG) unit for $1.25 billion. The PLG unit sells footwear and
related products, both wholesale and retail, for children and
adults under popular brands including Stride Rite, Sperry
Top-Sider, Saucony and Keds.
The deal is expected to provide ample opportunities to
Wolverine to boost its growth prospects while facilitating the
company to enhance its portfolio of brands.
Other Financial Aspects
Wolverine ended the quarter with cash and cash equivalents of
$171.4 million with net debt of $1,080 million and shareholders'
equity of $643.7 million.
Guidance Remains Strong
Going forward, this Zacks Rank #3 (Hold) stock expects fiscal
2013 consolidated revenues to be in the range of $2.7 to $2.8
billion, up 64.5% to 70.6% year over year. However, on a
pro-forma basis revenues are expected to increase in the range of
6% to 9.9%. Gross margin is expected to improve moderately in
fiscal 2013, while adjusted EBITDA is expected to be in the range
of $330 million to $345 million compared with adjusted EBITDA of
$220.8 million in fiscal 2012.
Adjusted earnings per share are expected to be in the range of
$2.50 to $2.65, reflecting year-over-year growth of 9.2% to
Other Stocks to Consider
Until any further upward revision in the rating of Wolverine,
other stocks in the same industry worth considering include
Skechers USA Inc.
) carrying a Zacks Rank #1 (Strong Buy) and
) carrying a Zacks Rank #2 (Buy).
ADIDAS AG-ADR (ADDYY): Get Free Report
DECKERS OUTDOOR (DECK): Free Stock Analysis
SKECHERS USA-A (SKX): Free Stock Analysis
WOLVERINE WORLD (WWW): Free Stock Analysis
To read this article on Zacks.com click here.