Deckers Outdoor Shares Jump After Solid Q4 Results

  • Deckers Outdoor Corp DECK reported fourth-quarter net sales growth of 31.2% year-over-year to $736 million, +31.7% on a constant currency basis, beating the consensus of $639.20 million.
  • Wholesale net sales increased 37.6% Y/Y to $448.8 million, and Direct-to-Consumer increased 22.2% Y/Y to $287.2 million. Comparable DTC net sales increased 19.3% Y/Y.
  • Sales by brands: UGG $374.6 million (+24.7% Y/Y), HOKA $283.5 million (+59.7% Y/Y), Teva $54.8 million (-8.8% Y/Y), Sanuk 1.7% to $11.9 million (-1.7% Y/Y), and Other brands, primarily composed of Koolaburra $11.2 million (+2.4% Y/Y).
  • The gross margin declined to 48.7% from 53.2% in 4Q21.
  • The operating income improved by 48.8% Y/Y to $81.3 million, and the margin expanded by 131 bps to 11.1%.
  • EPS improved to $2.51 from $1.18 in 4Q21, above the consensus of $1.32.
  • DECK held Cash and cash equivalents of $843.5 million at the end of the quarter. Inventories were $506.8 million compared to $278.2 million a year ago.
  • During the quarter, the Company repurchased ~308 thousand shares for $90.0 million at an average price paid per share of $292.51.
  • FY23 Outlook: Deckers Outdoor expects Net sales of $3.45 billion to $3.50 billion vs. a consensus of $3.45 billion, Gross margin of ~51.5%, and SG&A expenses as a percentage of sales of ~34%.
  • It expects an operating margin of 17.5% to 18.0% and Diluted earnings per share of $17.40 to $18.25, vs. a consensus of $8.34.
  • Price Action: DECK shares are trading higher by 13.30% at $256.90 during the post-market session on Thursday.
  • Photo via Wikimedia Commons
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