The new Patagonia footwear range, licensed by Wolverine World Wide, likely added about $30 million to the American footwear group’s turnover in its 1st quarter ended March 24. The inaugural launch of this footwear collection helped boost turnover for the “Outdoor Group,” which includes the Merrell, Sebago and Patagonia brands, by 12.1 percent to roughly $112 million.
The first shipments of the Merrell clothing line will go out to retailers this Fall, adding $10 million to revenues for the season. Initial orders have been 50 percent domestic and 50 percent outside of the USA, with the same ratio of men’s to women’s products. About 80 percent of the products consist of shirts and outerwear, while the remainder includes pants and accessories. In addition, there are tentative plans to open a company-owned retail store this Fall in the USA. The brand has 23 stores in place globally and more than 500 shop-in-shops.
Wolverine World Wide’s total revenues grew by 6.9 percent to $281.1 million in the latest quarter. The gross margin increased by 30 basis points to 40.6 percent, despite pressure from anti-dumping duties against certain shoes from China and Vietnam in the European Union. Net earnings rose by 14.7 percent to $22.3 million. The profit forecast has been adjusted upwards, with the group now calling for full-year earnings per share to be $1.57-1.63, as compared to previous estimates of $1.56-1.62. WWW maintains its guidance of $1.20-1.23 billion in revenues for the year.
Turnover in Europe grew by 7.4 percent during the period, with almost all of the brands reporting rises. Profits in the continent were negatively affected by $1.9 million stemming from the anti-dumping duties.
Three of the company’s four major brand groups reported positive results. The exception was the “Wolverine Footwear Group,” whose sales were affected by a planned decrease in a contract with the U.S. military, which negatively impacted total revenues by $2.8 million. The lost contract is expected to negatively affect full-year turnover by $13-15 million.
The “Heritage Brands Group,” which includes the licensed Caterpillar and Harley Davidson brands, reported an increase in sales of 11.8 percent, driven by larger wholesale turnover and by higher sales to distributors outside of the USA. Turnover for the Hush Puppies segment was up by low single digits. Profit increased by double digits for all of the segments except the Wolverine Footwear Group.
Meanwhile, Blake Krueger, 53, has been promoted to president and chief executive of the company, as planned, replacing Tim O’Donovan who will remain as chairman of the board following his recent re-election. Prior to the new role Krueger was WWW’s chief operating officer and president.
(More in Shoe Intelligence)
