As expected, the US footwear and clothing supplier Wolverine World Wide Inc. closed the 2023 financial year with significant sales losses. However, the parent company of brands such as Merrell, Saucony, Sweaty Betty and Wolverine was able to significantly reduce its losses.
According to a statement published on Wednesday, group sales last year amounted to 2.24 billion US dollars (2.08 billion euros). This corresponded to a decline of 16.5 percent (-16.3 percent at constant currency) compared to 2022. Adjusted for the shares of now discontinued business areas such as the shoe brand Keds, revenue shrank by 13.1 percent (-13.0 percent at constant currency).
The reported loss is falling thanks to savings measures and lower one-off charges
All of the group’s important brands suffered losses. Merrell’s annual sales fell by 11.6 percent (currency-adjusted -11.3 percent) to 675.8 million US dollars, Saucony’s by 1.9 percent (currency-adjusted -1.2 percent) to 495.8 million US dollars. Dollars and from Wolverine by 18.7 percent (-18.7 percent at constant currencies) to 201.2 million US dollars. The sportswear label Sweaty Betty came in at $203.8 million, missing the previous year’s level by 3.6 percent (-4.5 percent adjusted for currency effects).
Due to lower operating costs and significantly lower one-time charges, the operating loss fell from $208.4 million to $68.2 million. However, adjusted for special effects, operating profit fell by 61.1 percent to $67.5 million. The net loss attributable to shareholders, which was $188.3 million in 2022, fell to $39.6 million (36.6 million euros), and the reported diluted loss per share shrank from 2.37 to $0.51.
Management forecasts black numbers for 2024
CEO Chris Hufnagel emphasized that the group is currently implementing its ongoing transformation plan “at high speed”. “We have largely completed the stabilization phase of our turnaround,” he explained, considering the numerous cost-cutting measures implemented in recent months.
However, management expects further losses in sales for 2024: a decline of 12.2 to 14.7 percent (adjusted for currency effects -11.8 to -14.3 percent) to 1.70 to 1.75 billion US dollars is forecast. Nevertheless, the company expects to return to profitability: diluted earnings per share are expected to reach between $0.43 and $0.63.