by | Sep 13, 2010 | Press Release
Sep 13, 2010 • 9:00 am EDT
New U.S. Utility Patent Protects Kinetic Wedge Midsole Technology Designed to Tone Muscles and Provide Other Fitness Benefits
Patent Issued Days After Independent Review Board Finds SKECHERS’ Key Fitness Claims Substantiated
MANHATTAN BEACH, Calif.–(BUSINESS WIRE)– SKECHERS USA, Inc. (NYSE:SKX), a global leader in footwear, today announced that it has secured its 70th patent worldwide protecting its Shape-ups footwear line. The most recent United States patent (U.S. Patent No. 7,779,557), issued on August 24, 2010, protects the Kinetic Wedge midsole technology, the part of Shape-ups which is the key to providing fitness benefits to consumers.
“We are proud to announce the most recent addition to our Shape-ups patents,” said Leonard Armato, president of SKECHERS Fitness Division. “We have invested tremendous resources into developing this revolutionary footwear, and we go to great lengths to protect our retail partners and consumers from imitations and knockoffs. We are very aggressive in enforcing our patents throughout the world and routinely stop companies from infringing our rights.”
The recent patent, addressing the novel portion of Shape-ups that is central to providing fitness benefits, was issued just days after an independent review board in New Zealand ruled that “the claims in the [Shape-ups] advertisement regarding muscle tone, posture and weight loss had been substantiated by [Skechers] . . . .” This was the second time in recent months that an independent panel made a favorable ruling relating to Shape-ups fitness claims. Earlier this year an independent review board in Australia said that Skechers provided a substantial amount of evidence in support of Shape-ups fitness claims and ruled that Skechers’ competitors failed to provide any evidence to challenge Skechers’ claims.
Armato continued, “While we are pleased by securing these patents and the independent rulings on the fitness claims, they simply reinforce what our own studies and thousands of unsolicited consumer testimonials have told us all along: Shape-ups is a unique footwear technology that provides wonderful fitness benefits to consumers. We will continue to invest in developing new toning technology and designs, and to protect and enforce our rights worldwide.”
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia.
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the global economic slowdown and the ongoing financial crisis and market instability; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s Form 10-K for the year ended December 31, 2009 and Form 10-Q for the quarter ended June 30, 2010. The risks included here are not exhaustive. The Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the Company cannot predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
by | Aug 31, 2010 | Press Release
Aug 31, 2010 • 9:05 am EDT
MANHATTAN BEACH, Calif.–(BUSINESS WIRE)– SKECHERS USA, Inc. (NYSE:SKX), a global leader in the lifestyle footwear industry, today announced that it has signed a licensing agreement with Olivet International for SKECHERS-branded luggage and travel accessories for men, women and kids. The collection is scheduled to launch in Fall 2011 in the U.S. and Canada.
Under the agreement, Olivet International will design, produce and distribute SKECHERS-branded suitcases, wheeled totes, duffle bags and garment bags to launch in department stores, specialty stores and online retailers.
“Olivet is one of the largest luggage and accessories companies in North America and has an outstanding reputation for design excellence,” said Michael Greenberg, president of SKECHERS. “The new travel collections are an exciting addition to the SKECHERS brand, and we’re confident that Olivet will produce fashionable, on-trend products that perfectly complement our footwear and accessories collections.”
“The SKECHERS logo is one of the most recognized brands in the world,” said Jack Holodnicki, president of Olivet International. “They are a global leader in lifestyle and athletic footwear arena, and the new SKECHERS luggage collections will be an easy extension of the brand.”
In addition to Olivet International, SKECHERS has partnered with licensees to produce a wide range of products including children’s apparel, bags, sunglasses, legwear, medical scrubs and leather accessories. The Company is currently negotiating with additional licensees both domestic and abroad and continues to seek partnerships and opportunities that will bring the SKECHERS brand to new product segments around the globe.
About Olivet International, Inc.
Founded in 1984, Olivet International is a global trading company that designs and markets a wide range of products including luggage, handbags, insulated bags, bath products and apparel. Olivet holds licenses in various categories with many notable brands including Tommy Hilfiger, Jessica Simpson, Ellen Tracy, Jeep, Dockers, Joseph Abboud and Nascar. With headquarters in Mira Loma, California and offices in New York, Minneapolis, Boston, Los Angeles and various locations in China and Taiwan, Olivet is a global leader in the luggage and travel goods industry. For more information, please visit www.olivetintl.com.
About SKECHERS USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia. For more information, please visit www.skechers.com.
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the global economic slowdown and the ongoing financial crisis and market instability; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of apparel, accessories, footwear and other merchandise for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in SKECHERS’ Form 10-K for the year ended December 31, 2009 and SKECHERS’ Form 10-Q for the quarter ended June 30, 2010. The risks included here are not exhaustive. SKECHERS and Olivet International operate in a very competitive and rapidly changing environment. New risks emerge from time to time and the companies cannot predict all such risk factors, nor can the companies assess the impact of all such risk factors on their respective businesses or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
by | Aug 26, 2010 | Press Release
Aug 26, 2010 • 9:00 am EDT
Board Says that Shape-ups Advertising Claims Are Accurate, Truthful and “Prepared with a Due Sense of Social Responsibility to Consumers and Society”
The United States Patent and Trademark Office Issues Skechers a Utility Patent on the Unique Shape-ups Midsole Technology
MANHATTAN BEACH, Calif.–(BUSINESS WIRE)– SKECHERS USA, Inc. (NYSE:SKX), announced today that an independent review Board said that Skechers Shape-ups advertising claims are accurate, truthful and “prepared with a due sense of social responsibility to consumers and society.”
In a related development, Skechers further announced today that the United States Patent and Trademark Office this week issued Skechers a utility patent on its unique Shape-ups midsole technology, the part of the shoe which is key to imparting fitness benefits to users, including “muscle strengthening and toning, better posture, improved cardiovascular health, less stress on joints, and improved circulation.” (U.S. Patent No. 7,779,557).
On August 10, 2010, the New Zealand Advertising Standards Authority (“ASA”) ruled that “the claims in the [Shape-ups] advertisement regarding muscle tone, posture and weight loss had been substantiated by [Skechers] and therefore were not likely to mislead or deceive consumers.”
This is the second time in recent months that independent panels have made favorable rulings relating to the claims that Shape-ups tone muscle, improve posture and promote weight loss. Earlier this year, Australia’s independent Therapeutic Products Complaints Resolution Panel (CRP) dismissed complaints by two competitors of Skechers who alleged that Shape-ups did not provide the benefits of weight loss, muscle toning and improved posture.
The Australian CRP stated that Skechers “provided a substantial amount of evidence in support of the claims” that Shape-ups promote weight loss, tone muscles and improve posture and found that Skechers’ competitors failed to provide any argument or evidence to challenge Skechers’ claims.
“We’re not the least bit surprised by these decisions, which we feel confirm what we have been saying all along – that the facts and science support Skechers’ claims and are largely responsible for the success of Shape-ups,” said Leonard Armato, President of Skechers Fitness Division.
In the most recent ruling, the New Zealand ASA reviewed four separate studies done on Shape-ups, two conducted by Dr. Steven Gautreau, D.C.; one by a major Southern California Hospital; and another by Juntendo University in Japan. The ASA also reviewed a separate report prepared by Kendle Pty. Ltd., a biopharmaceutical research organization which independently evaluated the Shape-ups claims and the four studies used to support those claims.
“In recent weeks, Shape-ups have been the subject of a scientifically worthless report claiming to be a ‘study’ and questioning our advertising claims for Shape-ups without providing any raw data,” Armato said. “The report was also referenced in misleading and biased news coverage. These recent decisions go a long way toward answering the critics. While we are happy to address any complaints raised in the future, we will aggressively defend the integrity of this great product from baseless complaints and junk science attacks.”
Armato continued: “Shape-ups advertising claims are substantiated by solid scientific testing, but the best substantiation is the sheer popularity of the shoe. Skechers has received literally thousands of unsolicited testimonials from customers praising Shape-ups and saying that they received the benefits claimed.”
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia.
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the global economic slowdown and the ongoing financial crisis and market instability; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s Form 10-K for the year ended December 31, 2009 and Form 10-Q for the quarter ended June 30, 2010. The risks included here are not exhaustive. The Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the Company cannot predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
by | Aug 24, 2010 | Press Release
Aug 24, 2010 • 5:05 pm EDT
Coast-to-Coast Tour Allowed Thousands of Consumers to Experience the Shape-ups Phenomenon
MANHATTAN BEACH, Calif., Aug. 24 /PRNewswire-FirstCall/ — SKECHERS USA, Inc. (NYSE: SKX), a leader in the toning footwear industry with 70% of the current market share, wrapped up a successful 20 city tour in New York City‘s Times Square. Cruising across the country from June through August, the Shape-up America Tour caps off a hugely successful year for the brand as it has become the gold standard of the toning industry since its launch in 2009.
The Shape-up America Tour gathered thousands of consumers and the finale in New York City was no exception. Denise Austin, America’s favorite fitness expert, hosted the festivities in Times Square which included exercise classes, games and a special presentation to Amelia Hunter of Charlotte, NC winner of the “My Shape-ups Story Contest”. Amelia was one of several contestants who shared her Shape-ups story at the “Taste of Chicago” and won a trip for two to the New York City finale, a Shape-ups wardrobe and a personal meet and greet with Denise Austin.
“I love my Shape-ups” says Amelia Hunter with delight. “I bought 5 pairs. I wear them all the time and I’ve lost 10 pounds and several inches – I’m a lot more firm.” She continued to share with the crowd at Times Square, “My friends call me the ‘Shape-ups Pusher’. I’ve bought a pair for my daughter and two of my friends. I’m addicted to them.”
Designed with a soft kinetic wedge and dynamic rocker bottom to help improve posture, strengthen the back and tighten abdominal, buttock and calf muscles, the Shape-ups Original style helped launch the toning industry. The Company’s 2010 Tour is designed to meet consumers’ growing needs for its product: offering a newly expanded Shape-ups collection, fitness experts, multimedia support, and informational materials to give consumers the complete Shape-ups experience in their hometowns.
In addition to the hugely popular Shape-ups Original, the Tour introduced:
-- Shape-ups XT&Shape-ups XF: Extended Training for men and Extended
Fitness for women are designed to transform routine activities into an
all-day, low-intensity workout.
-- SRT: SKECHERS Radius Trainer is designed for a high-intensity workout
with accelerated muscle activation.
-- Shape-ups AT: All Terrain for men and women provide support and
protection for rugged excursions.
-- SRR – The Resistance Runner for men and women is designed to create
the a more fluid stride that simulates a natural running state.
“Everyone wants to incorporate some type of fitness into their lives, but it often comes down to time and access,” said Jennifer Weiderman, vice president and general manager of SKECHERS Fitness Group. “Shape-ups solve that problem. People can wear them wherever they go and for whatever activity they do and get a workout. Shape-ups engage more muscles, make you work harder, and generate results. The Shape-up America Tour is a way of bringing Shape-ups to Americans across the country to let them experience these benefits for themselves.”
For more information on Shape-ups visit www.skechers.com and for photos from the tour visit Facbook.com
ABOUT SKECHERS USA, Inc.
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia. For more information, please visit www.skechers.com.
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the global economic slowdown and the ongoing financial crisis and market instability; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s Form 10-K for the year ended December 31, 2009 and the Company’s Form 10-Q for the quarter ended March 31, 2010. The risks included here are not exhaustive. The Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the Company cannot predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
SOURCE SKECHERS USA, Inc.
by | Aug 10, 2010 | Press Release
Aug 10, 2010 • 3:21 pm EDT
Company says it voluminous scientific studies and customer testimonials fully support Shape-ups claims and it will vigorously defend against two “meritless” civil suits
Company says American Council on Exercise report critical of Shape-ups is flawed and marred by conflict-of-interest
MANHATTAN BEACH, Calif.–(BUSINESS WIRE)– SKECHERS USA, Inc. (NYSE:SKX) today said that the two recently filed civil class actions disclosed in its Form 10-Q for the quarter ended June 30, 2010 each have only a single plaintiff and both are completely baseless.
The complaints, Tamara Grabowski v. Skechers USA, Inc. and Sonia Stalker v. Skechers USA, Inc., allege that the Company’s advertising for Shape-ups violates California law. The complaints, which were filed respectively on June 18 and July 2, are in the early stages and that the Company will mount a vigorous defense. Skechers is being represented in the civil suits by Daniel M. Petrocelli of O’Melveny & Myers.
“While the Company does not usually comment on pending litigation and seeks to vindicate itself in court, it is important to set the record straight before such false and disparaging allegations take on a life of their own,” said Anthony Glassman, an attorney and spokesperson for Skechers. “The Company believes that the lawsuits are inconsistent with numerous scientific studies, including studies cited in one of the lawsuits.”
Those studies were conducted on the category of shoes called rocker bottom shoes, to which Shape-ups belong, the Company said. Links to key studies, including two published in peer-reviewed journals, are available at www.ToningShoeStudies.com.
Mr. Glassman said, “The body of scientific research shows that rocker bottom shoes increase muscle activity and heighten the metabolic demands of walking. Indeed, one study cited in one of the lawsuits actually found that subjects wearing rocker bottom shoes experienced increased muscle activity in various muscles, when compared to those wearing flat bottom shoes.”
“The research has also shown that wearers of Shape-ups — when compared to wearers of conventional flat bottom shoes — show increased weight loss, greater reductions in body fat, and other improvements in fitness and health markers,” Mr. Glassman said.
He said the most recent study was an eight week study with 80 participants conducted by Dr. Steven Gautreau, D.C. and further reviewed and endorsed independently by Dr. Gerry Edwards, D.C.
Mr. Glassman added that the Shape-ups studies are consistent with the findings of other studies of rocker-bottom shoes published in peer-reviewed clinical journals over a period of several years, and three prior studies conducted on Shape-ups by other experts, including a study by a leading Southern California hospital and University; a prior trial study by Dr. Gautreau; and a study by Juntendo University in Japan.
The Company said that these scientific studies also contradict a recent critical report by the American Council on Exercise (ACE), an exercise company that sells fitness training courses, fitness materials and apparel and has a financial incentive to minimize Shape-ups sales through its public relations and marketing.
“The ACE report has no scientific validity and is virtually worthless to support any claim as to the benefits of Shape-ups,” Mr. Glassman said. “The report’s conclusions are wholly unscientific and not supported by the very limited data released, the unsound methodology and poor analytical technique that were used. The ACE report stands in marked contrast to the numerous studies supporting the benefits of rocker bottom shoes, which fully disclose the study design and methods used.”
The Company also said that the popularity of its toning shoes provides convincing evidence that customers are pleased with the product.
“Skechers has received thousands of letters from fully satisfied customers and hundreds of reviews and amateur videos have been posted on the Internet by customers praising Shape-ups shoes and declaring that they have received the benefits described in Skechers’ advertising,” Mr. Glassman said. “We believe the sheer volume of this unsolicited positive feedback received is a clear indication that the vast majority of consumers are satisfied and do not feel they have been misled.”
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia..
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the global economic slowdown and the ongoing financial crisis and market instability; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s Form 10-K for the year ended December 31, 2009 and Form 10-Q for the quarter ended June 30, 2010. The risks included here are not exhaustive. The Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the Company cannot predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
by | Jul 28, 2010 | Press Release
Jul 28, 2010 • 4:00 pm EDT
- Net Sales of $504.9 Million
- Earnings from Operations of $58.8 Million
- Net Earnings of $40.2 Million
- Diluted Earnings Per Share of $0.82
MANHATTAN BEACH, Calif.–(BUSINESS WIRE)– SKECHERS USA, Inc. (NYSE:SKX), a global leader in lifestyle footwear, today announced financial results for the second quarter ended June 30, 2010.
Second quarter 2010 net sales increased 68.9 percent to $504.9 million compared to $299.0 million in the second quarter of 2009. Earnings from operations for the second quarter of 2010 were $58.8 million compared to a loss from operations of $7.7 million in the second quarter of 2009. Net earnings for the second quarter of 2010 were $40.2 million versus a net loss of $5.9 million in the second quarter of 2009. Second quarter diluted earnings per share were $0.82 based on 49,130,000 weighted average common shares outstanding as compared to a net loss per diluted share of $0.13 based on 46,282,000 weighted average common shares outstanding.
“Our second quarter net sales of over $500 million are a first in our 18-year history. In addition, we achieved record second quarter operating income, net earnings and earnings per diluted share on the heels of a record first quarter,” began David Weinberg, chief operating officer and chief financial officer. “The significant revenue growth is attributable to strong operational execution and product development and delivery across our domestic and international wholesale and retail channels, as well as via our e-commerce platform. We believe our momentum is being meaningfully supported and enhanced by our continued marketing efforts globally.”
For the six months ended June 30, 2010, net sales were $997.6 million compared to net sales of $642.4 million in the first six months of 2009. Earnings from operations for the first six months were $139.8 million compared to a loss from operations of $1.6 million in the same period of 2009. Net earnings were $96.5 million, compared to net earnings of $2.3 million in the first six months of 2009. Net earnings per diluted share in the first six months of 2010 were $1.97 per share on 48,955,000 million diluted shares outstanding versus net earnings of $0.05 per share on 46,424,000 million diluted shares outstanding for the same period last year.
Gross profit for the second quarter of 2010 was $237.6 million or 47.1 percent of net sales compared to $122.6 million or 41.0 percent of net sales in the second quarter of last year. Gross profit for the first six months of 2010 was $475.1 million or 47.6 percent of net sales versus $248.0 million or 38.6 percent of net sales in the first six months of 2009.
Robert Greenberg, SKECHERS chief executive officer, commented: “We reached a new revenue milestone with our first ever quarterly net sales of over $500 million and nearly $1 billion for the first six months of 2010. This growth is a significant achievement given that the U.S. retail market has only slightly improved from last year. The combination of our strong position and product momentum has resulted in continued penetration in the footwear market and increasing demand for our SKECHERS brand both in the United States and around the world. We remain dedicated to delivering innovative men’s, women’s and kids’ product and developing new marketing campaigns to support our efforts. We are looking forward to the back-to-school season, which we believe will be our strongest yet. The product success we achieved in the United States over the past six months is beginning to spread to markets around the world, and we believe our growth will accelerate in many of these countries. We continue to develop exciting new product and had a very positive reaction to our new lines with key accounts earlier this month, giving us a glimpse of what we expect will be a strong finish to the year. We are in a very strong position in the market with a buzz that is growing from consumers and the media. We believe that 2010 marks a new phase in SKECHERS’ development, and that we will continue to strategically grow — becoming one of the most sought after performance and lifestyle brands in the world.”
“SKECHERS’ top-line growth, significantly increased profitability and much improved margins are the result of our consistent efforts to deliver fresh, innovative product supported by relevant marketing around the world,” Mr. Weinberg added. “Our product is in high demand, inventory is clean, and our balance sheet continues to strengthen. At quarter end, our cash position was over $273 million, even though we accelerated factory payments of $64 million and made a capital contribution of $30 million to our distribution center joint venture. We broke ground during the second quarter on this new, more efficient, 1.8 million-square-foot facility in Rancho Belago, California. With a triple digit increase in backlogs and double digit retail store comps, we believe our momentum will continue.”
SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of footwear for men, women and children under the SKECHERS name, as well as under several uniquely branded names. SKECHERS footwear is available in the United States via department and specialty stores, Company-owned SKECHERS retail stores and its e-commerce website, as well as in over 100 countries and territories through the Company’s global network of distributors and subsidiaries in Canada, Brazil, Chile, and across Europe, as well as through joint ventures in Asia. For more information, please visit www.skechers.com.
This announcement may contain forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate or simply state future results, performance or achievements, and can be identified by the use of forward looking language such as “believe,” “anticipate,” “expect,” “estimate,” “intend,” “plan,” “project,” “will be,” “will continue,” “will result,” “could,” “may,” “might,” or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international, national and local general economic, political and market conditions including the recent global economic slowdown and financial crisis; entry into the highly competitive performance footwear market; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers, decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s Form 10-K for the year ended December 31, 2009 and the Company’s Form 10-Q for the quarter ended March 31, 2010. The risks included here are not exhaustive. The Company operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the Company cannot predict all such risk factors, nor can the Company assess the impact of all such risk factors on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.
SKECHERS U.S.A., INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands)
June 30, December 31,
2010 2009
ASSETS
Current Assets:
Cash and cash equivalents $ 273,266 $ 265,675
Short-term investments - 30,000
Trade accounts receivable, net 304,992 219,924
Other receivables 7,526 12,177
Total receivables 312,518 232,101
Inventories 219,360 224,050
Prepaid expenses and other current assets 30,012 28,233
Deferred tax assets 8,950 8,950
Total current assets 844,106 789,009
Property and equipment, at cost less accumulated 236,709 171,667
depreciation and amortization
Intangible assets, less applicable amortization 8,147 9,011
Deferred tax assets 13,667 13,660
Other assets, at cost 33,213 12,205
TOTAL ASSETS $ 1,135,842 $ 995,552
LIABILITIES AND EQUITY
Current Liabilities:
Short-term borrowings $ 1,956 $ 2,006
Current installments of long-term borrowings 15,899 529
Accounts payable 191,653 196,163
Accrued expenses 22,142 31,843
Total current liabilities 231,650 230,541
Long-term borrowings, excluding current installments 14,532 15,641
Total liabilities 246,182 246,182
Equity:
Skechers U.S.A., Inc. equity 855,235 745,922
Noncontrolling interests 34,425 3,448
Total equity 889,660 749,370
TOTAL LIABILITIES AND EQUITY $ 1,135,842 $ 995,552
SKECHERS U.S.A., INC.
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
(In thousands, except per share data)
Three Months Ended June 30, Six Months Ended June 30,
2010 2009 2010 2009
Net sales $ 504,859 $ 298,976 $ 997,623 $ 642,446
Cost of sales 267,214 176,373 522,560 394,414
Gross profit 237,645 122,603 475,063 248,032
Royalty income 875 332 1,260 604
238,520 122,935 476,323 248,636
Operating expenses:
Selling 52,437 34,813 86,746 56,323
General and 127,299 95,848 249,786 193,886
administrative
179,736 130,661 336,532 250,209
Income (loss) from 58,784 (7,726 ) 139,791 (1,573 )
operations
Other income (expense):
Interest, net 318 (331 ) 1,031 333
Other, net 1,611 245 1,820 27
1,929 (86 ) 2,851 360
Earnings (loss) before 60,713 (7,812 ) 142,642 (1,213 )
income taxes
Income tax expense 20,396 (1,186 ) 46,202 (1,939 )
(benefit from)
Net income (loss) 40,317 (6,626 ) 96,440 726
Less: Net income (loss)
attributable to 80 (699 ) (93 ) (1,567 )
noncontrolling interest
Net earnings (loss)
attributable to Skechers $ 40,237 $ (5,927 ) $ 96,533 $ 2,293
U.S.A., Inc.
Net earnings (loss) per
share attributable to
Skechers U.S.A., Inc.:
Basic $ 0.85 $ (0.13 ) $ 2.05 $ 0.05
Diluted $ 0.82 $ (0.13 ) $ 1.97 $ 0.05
Weighted average shares
used in calculating
earnings (loss) per share
attributable to Skechers
U.S.A., Inc.:
Basic 47,422 46,282 47,107 46,252
Diluted 49,130 46,282 48,955 46,424
