Thanks to strong demand for shoes from the Ugg and Hoka brands, the US retail group Deckers Brands closed the third quarter of the 2023/24 financial year with surprisingly strong increases in sales and earnings.
In addition to the current figures, the company also announced an impending change in management on Thursday evening. CEO and President Dave Powers will resign effective August 1, a statement said. His successor has already been found internally. Chief Commercial Officer Stefano Caroti will take over his position after Powers’ departure.
Strong growth at Hoka and Ugg is boosting sales
In the third quarter, the company was again able to exceed market expectations: in the period from October to December, consolidated sales amounted to 1.56 billion US dollars (1.43 billion euros), an increase of 16.0 percent (currency-adjusted +15, 1 percent) compared to the corresponding previous year’s level.
The running shoe brand Hoka developed particularly dynamically, with sales increasing by 21.9 percent to $429.3 million. The Ugg label achieved an increase of 15.2 percent to 1.07 billion US dollars.
In contrast, Teva’s sales fell by 16.2 percent to $25.6 million and Sanuk by 28.9 percent to $4.0 million. The other group brands, which include the Koolaburra label, achieved combined sales of $29.6 million, exceeding the previous year’s level by 10.0 percent.
Management is raising its annual forecasts again
Because the gross margin increased from 53.0 to 58.7 percent, the group was able to clearly improve its results. The operating profit rose by 34.5 percent to 487.9 million US dollars, the net result even grew by 39.9 percent to 389.9 million US dollars (358.2 million euros).
In view of the surprisingly positive development, management once again raised its forecasts for the entire financial year. It now expects sales to increase by 14 percent to around $4.15 billion. Diluted earnings per share target increased to $26.25 to $26.50. That would correspond to an increase of around 36 percent compared to the previous year. The group had previously expected sales of $4.025 billion and diluted earnings per share between $22.90 and $23.25.