US' Deckers Brands' Q2 FY25 sales rise 20.1% to $1.311 bn

Direct-to-consumer (DTC) net sales of the company increased 19.9 per cent to $397.7 million compared to $331.7 million. DTC comparable net sales increased 17.0 per cent. The company’s wholesale net sales increased 20.2 per cent to $913.7 million compared to $760.2 million in the same period last year.

The domestic net sales of Deckers Brands increased 14.2 per cent to $853.9 million compared to $748.0 million. Meanwhile, its international net sales were up by 33.0 per cent to $457.4 million in comparison to $343.9 million in Q2 FY24, as per a press release by Deckers Brands.

The gross margin in this quarter was 55.9 per cent compared to 53.4 per cent in the same quarter of previous fiscal. Selling, general, and administrative (SG&A) expenses were $428.2 million compared to $358.4 million in the same period last year. The operating income of the company was $305.1 million compared to $224.6 million.

The diluted earnings per share (EPS) for the company in Q2 FY25 was $1.59 compared to $1.14 in Q2 FY24. During the quarter, the company effected a six-for-one forward stock split of its common stock (the stock split), while maintaining the par value of $0.01 per share, the company said in its release.

In terms of sales from brands, HOKA brand net sales increased 34.7 per cent to $570.9 million compared to $424.0 million in second quarter of last fiscal. UGG brand net sales increased 13.0 per cent to $689.9 million compared to $610.5 million in Q2 FY 24. Teva brand net sales increased 2.3 per cent to $22.0 million compared to $21.5 million in the same period of FY24. Sanuk brand net sales decreased 47.6 per cent to $2.8 million compared to $5.4 million. Other brands, primarily composed of Koolaburra, net sales decreased 15.8 per cent to $25.8 million compared to $30.6 million in Q2 last fiscal, stated the release.

Cash and cash equivalents of the company were $1.226 billion in Q2 FY25 compared to $823.1 million in the same period of last fiscal. Inventories were $777.9 million compared to $726.3 million in Q2 FY24. The company had no outstanding borrowings, added the release.

During the second quarter of the current fiscal, the company repurchased approximately 686,000 shares of its common stock for a total of $104.3 million at a weighted average price paid per share of $152.09. As of September 30, 2024, the company had approximately $685.4 million remaining under its stock repurchase authorisation.

The company in its outlook for the full fiscal year 2025 expects net sales to increase approximately 12 per cent to $4.8 billion and gross margin to be in the range of 55 per cent to 55.5 per cent. SG&A expenses as a percentage of net sales are expected to be approximately 35 per cent. Meanwhile operating margin is expected to be in the range of 20 per cent to 20.5 per cent. Effective tax rate is expected to be in the range of 23 per cent to 23.5 per cent. Diluted earnings per share is expected to be in the range of $5.15 to $5.25.

“HOKA and UGG produced outstanding second quarter results driven by strong consumer demand for our innovative and unique products,” said Stefano Caroti, president and chief executive officer. “As I step into the CEO role, I am committed to building on our proven foundation to support growth, guided by our consumer-first mindset, brand-led philosophy, innovation-forward products, and globally driven focus. Our dedicated teams' continued execution of Deckers long-term strategy has our company well-positioned to achieve an increased outlook for fiscal year 2025.”

Fibre2Fashion News Desk (SG)