Skechers’ momentum comes to a halt

Worldwide
Published:  01 May, 2020

After recording strong momentum throughout 2019, which continued into the first two months of 2020, the sportswear and apparel brand posted sales of US$1.24 billion for the first quarter of the year, down 2.7% year-on-year.

Skechers’ constant currency sales amounted to US$1.26 billion in the first quarter of the year, representing a 1.2% decrease. Domestic wholesale sales increased 9% in the quarter, while international wholly-owned subsidiary sales were up 9.4%. Earnings from operations decreased US$121.1 million, or 73% to US$44.8 million, while net earnings were US$49.1 million and diluted earnings per share were US$0.32 (-54.9%) and adjusted earnings per share were US$0.39 (-45.1%). Gross margins decreased by approximately 220 basis points in the period.

“We are in unprecedented times, facing difficult decisions daily as we navigate this global pandemic that has negatively impacted every business throughout our industry, and most others”, said Robert Greenberg, CEO, Skechers. “We know from the triple-digit growth we are experiencing so far in this month in our e-commerce business and the positive sales trajectory of our recovering business in China, that Skechers’ product continues to resonate with consumers”, he added. David Weinberg, Chief Operating Officer, Skechers, said that until the worldwide spread of COVID-19 in March, the business was on track for a new first quarter sales record, with the highest shipments ever from its North American and European distribution centres being achieved in January and February, and worldwide comparable same store sales up 9.8%  for the first two months of the quarter.