Steve Madden saw a successful third quarter of fiscal year 2017, seeing a sales increase and wholesale sales increase in line with projections.
Net sales for the quarter increased 8 percent to $441.2 million, compared to $408.4 million during the same period last year.
“We recorded solid sales and EPS growth in the quarter despite the challenging retail environment, led by strong performance across our Steve Madden wholesale footwear businesses, including Steve Madden Women’s, Men’s and Kids’ as well as Madden Girl,” said Edward Rosenfeld, chairman and CEO. “As we look ahead, we expect that we will continue to face industry headwinds, and as a result, we are planning our business prudently. That said, we believe that our strong brands, proven business model and on-trend product offerings position us well to meet our financial targets for the year and continue to enhance shareholder value over the long-term.”
Net income was $44.2 million, or $0.77 per diluted share, while adjusted net income was $44.5 million, or $0.77 per diluted share, compared to $43.8 million, or $0.74 per diluted share during the same period last year.
However, the gross margin dropped 20 basis points from 37.8% to 37.6%. Meanwhile, retail net sales in the third quarter increased 4 percent to $64.3 million, compared to $61.8 million during the same period last year. Same store sales fell 3.8% in the quarter, compared to a 1.3% same store sales increase the year before. Retail gross margin decreased to 59.3% during the period, compared to 59.9% the year before.
The wholesale segment for the quarter saw net sales increase 8.7% to $376.9 million, excluding he results of recently acquired Schwartz & Benjamin, wholesale net sales grew 1.6% to $346.6 million. However, the increase in wholesale footwear business was minorly offset by a drop in wholesale accessories. Gross margin in the wholesale business was 33.9%, which is flat compared to the same period last year.
Outlook
The company is maintaining its full-year outlook and anticipates net sales in FY2017 will grow 9 percent to 11 percent over net sales in 2016. EPS is expected on a GAAP basis for FY2017 will be around $2.03 to $2.09, while adjusted diluted EPS for the year will be around $2.18 to $2.24.