Crocs beats on full year revenue and sees strong Q4 despite store closures
Niwot, Colorado-based Crocs Inc. announced on Thursday strong fourth-quarter results, despite the negative impact of store closures that continued during the three months as part of the shoe brand's transformation plan.
For the fourth quarter, Crocs reported revenue growth of 8.5 percent reaching $216 million, compared to 2017. E-commerce grew the most climbing 18.9 percent, while wholesale revenues grew 9.7 percent. Comparable store sales grew 13.4 percent.
In a statement released with the earnings, Crocs said store closures and business model changes during the quarter reduced company revenues by approximately $7 million. However, Crocs' CEO Andrew Rees praised the success of the holiday season, particularly in the U.S., which drove overall sales during the final quarter.
"Our fourth quarter results contributed to what was a very successful year,” said Rees.
“We had record revenues in many key markets, with the U.S. market leading the way. We have hit multi-year highs in revenues and gross margin, while at the same time significantly reducing our SG&A run rate. Global demand for our brand remains strong, and as a result, we anticipate delivering revenue growth of 5 to 7 percent in 2019," added Rees.
For the full-year 2018, Crocs’ revenues hit $1.09 billion, jumping 6.3 percent over 2017. The company's e-commerce business saw double-digit growth climbing 22.5 percent, while its wholesale business grew 7.8 percent. Comparatively, Crocs' comparable store sales lifted by 10.8 percent.
Income from operations during the year totalled $62.9 million, up from $17.3 million in 2017. Still, the company saw a net loss of $69.2 million due to its on-going transformation plan.
The company has been closing stores in recent years in an effort to boost its business. Crocs also launched a number of high-profile partnerships during the year, including one with rapper Post Malone and actress Drew Barrymore.
Looking ahead, the company forecast first-quarter revenue for 2019 to fall between between $280 and $290 million, similar to the $283.1 million recorded in the first quarter of 2018.
Crocs said 2019 revenues are expected to climb 5 to 7 percent over 2018 revenues of $1.09 billion. It expects a negative impact of approximately $20 million resulting from store closures and approximately $20 million of currency changes.
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