Wolverine World Wide Inc.’s shares are well into the green — up nearly 9 percent, to $26.51, as of 12:10 p.m. — after the firm announced today that it beat analysts’ Q1 sales and earnings estimates and acquired the domain OnlineShoes.com.
Amid aggressive store closures — part of its “Way Forward” plan — the owner of Sperry, Keds, Saucony and other popular shoe brands said its Q1 sales dipped 4.8 percent, to $591.3 million, but significantly surpassed analysts’ sales estimates of $557.8 million. (Wolverine has closed 180 stores since the beginning of 2017. All Stride Rite and Track-N-Trail concept stores are now closed, and the company plans to close 30 to 40 more stores by year-end. The company plans to eventually close all of its Stride Rite stores.)
Net earnings fell 4.5 percent, to $16.8 million, or 17 cents per diluted share, during the period. But adjusted earnings per share, at 37 cents — or 40 cents per share on a constant-currency basis — were better than market watchers’ forecast of 31 cents for diluted EPS.
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Wolverine chairman, president and CEO Blake Krueger noted during the firm’s conference call that it recently completed a strategic review of its existing portfolio and had been exploring a variety of alternatives for several brands. Accordingly, Wolverine’s latest buy, of the OnlineShoes.com domain and its consumer database, is part of a move toward building a stronger portfolio.
“This work is continuing, and we expect some announcements in the very near future,” Krueger said. “We remain active in assessing the strategic fit of new brands and businesses to our portfolio as our M&A activities have historically provided significant profitable growth for the company.”
Of the OnlineShoes.com buy, he noted: “Last year, OnlineShoes.com had over 35 million site visits and has a database of nearly 4 million consumers. We believe leveraging this existing traffic and consumer database will enable us to accelerate growth across our portfolio of brands. We will continue to look for new and innovative ways to drive growth, consumer connections and, ultimately, shareholder value by actively managing our portfolio.”
Based on a “strong start” to the fiscal year, Wolverine also said today that it has raised its adjusted earnings guidance for the year. Adjusted diluted EPS are now expected in the range of $1.50 to $1.60, compared with prior guidance of a range of $1.45 to $1.55.
