Despite a revenue decrease of 4.8% to $591.3 million, the company reported an adjusted gross margin on a constant currency basis increase of 41.7%, up 120 basis points compared to the same period last year.
“We had a solid start to the year, highlighted by first-quarter revenue and earnings that surpassed expectations and strong progress toward our holistic, enterprise-wide strategic transformation initiative, the Wolverine Way Forward,” said Blake W. Krueger, Wolverine Worldwide’s Chairman, CEO and president.
Wolverine Worldwide reported diluted earnings per share of $0.17, a marginal decrease compared to $0.18 during the same period last year.
The Wolverine Way Forward Transformation plan speeds up by closing 180 stores since the beginning of the year, incurring around $9.2 million of operating losses in the first quarter. All Stride Rite and Track-N-Trail concept stores are now closed, allowing the company to liquidate inventory amounting to around $20 million during the first quarter.
“Our proactive efforts aimed at overcoming the challenging global market conditions paid off in Q1, with nearly all brands in the portfolio exceeding their revenue plans for the quarter, while also over-delivering on our operating profit goals,” said Mike Stornant, Senior VP and CFO.
The company closed 104 under-performing stores during the first quarter, and another 76 stores succeeding the end of the quarter.
“We made tremendous progress on our store realignment plan including the closure of all Stride Rite stores, and now have line-of-sight to our go-forward store-fleet. We managed our working capital well in the quarter, with inventory down over 25 percent and DSOs improving by 1.1 days. We believe the strength of our global brands combined with the continued discipline in the management of our business and implementation of our Wolverine Way Forward plan leaves us well placed to achieve our goals.”
The company adjusted its outlook for 2017, now expecting diluted earnings per share in the range of $0.73 to $0.83, compared to $0.89 during the same period last year. Adjusted diluted earnings per share are now expected in the range of $1.5 to $1.6 compared to last year’s $1.36 during FY2016.