Wolverine Worldwide reported today a doubling in its quarterly revenues to $645.9 million for the period ended on March 31 thanks to its acquisition last October of Sperry Top-Sider, Saucony, Stride Rite and Keds. On a pro forma basis, assuming that it owned them already at the beginning of 2012, its revenues would have increased by 8.2 percent.
The group's gross margin declined by about 0.4 percentage points to 40.6 percent. The newly acquired brands contributed to boost the group's operating income, but overall, the operating margin declined to 7.9 percent from 11.4 percent a year ago. Net profits were down slightly to $29.8 million from $31.2 million, but excluding the expenses related to acquisitions, they grew by 26.6 percent.
Sperry, Merrell and Saucony all enjoyed excellent performance in the quarter. The group continued to meet challenging conditions in Europe, but it did well in other international markets and the U.S. According to the management, Merrell felt the brunt of an overall 12.5 percent drop in the group's European sales during the quarter.
Merrell's Performance Outdoor segment, which represents 40 percent of the brand's global revenues, has been growing pretty much in line with the market. Its Outside Athletic segment, which accounts for about 20 percent of sales, grew at a double-digit rate thanks to good response to the M-Connect line. The Lifestyle segment, which represents 40 percent of Merrell's sales, recorded a decline, but its product range is being adjusted.
For the full 2013 financial year, Wolverine expects to raise its total sales by between 6 and 9 percent, but much of the growth is coming from the new brands in its portfolio, led by Sperry. If it continues to grow at the current pace, it may move from second to first place within the group, overtaking Merrell (more already published in Shoe Intelligence).