Sales of American firm Skechers soar 12.5% in Q1 FY24

The company detailed that wholesale operations expanded by 9.8 per cent, contributing an additional $127.1 million to the sales figure. Notably, sales growth in the EMEA region was 11.5 per cent, in the APAC region 15.3 per cent, and in the AMER region 5.9 per cent. The wholesale volume itself grew by 9.9 per cent, while the average selling price remained stable, Skechers said in a press release.

Direct-to-consumer sales also showed impressive gains, increasing by 17.3 per cent to $122.6 million. This includes a notable 62.4 per cent increase in the EMEA region, 16.5 per cent in APAC, and 10.5 per cent in AMER. The volume in this sector went up by 15.5 per cent, with the average selling price rising by 1.6 per cent.

The company's gross margin improved significantly, reaching 52.5 per cent, a rise of 360 basis points. This increase was primarily attributed to lower unit costs, decreased freight expenses, and higher average selling prices.

However, operating expenses also saw an increase, rising by $127.8 million, or 16.9 per cent. As a percentage of sales, these expenses increased by 150 basis points to 39.2 per cent. Selling expenses alone rose by 21.7 per cent, or $27.9 million, mainly due to elevated demand creation expenditures. General and administrative expenses went up by $99.9 million or 15.9 per cent, influenced by higher labour and facility costs, including rent and depreciation.

Despite the rise in expenses, earnings from operations climbed significantly by 33.6 per cent to $298.8 million, with the operating margin expanding to 13.3 per cent. Net earnings also increased to $206.6 million, and diluted earnings per share rose from $1.02 to $1.33 compared to the same period last year.

“With the strong global demand for our brand and a healthy inventory position comprised of proven sellers, innovative technologies and new product categories, we believe that we have significant opportunities for growth across the globe, and we remain confident in our on-going success,” said David Weinberg, chief operating officer of Skechers.

Fibre2Fashion News Desk (DP)