- Prachi Singh |
Wolverine Worldwide, Inc. for its third quarter reported revenue of 558.6 million dollars, a decrease of 3.9 percent, while the company said, underlying revenue increased 0.5 percent and further adjusting for currency, increased 1.1 percent. Reported gross margin was 41.6 percent compared to 39.7 percent in the prior year.
On an adjusted basis, gross margin of 41.6 percent expanded 170 basis points compared to the prior year. Reported diluted EPS was 0.60 dollars compared to 0.24 dollar in the prior year and adjusted diluted EPS were 0.62 dollar compared to 0.43 dollar in the prior year, an increase of 44 percent.
"We reported strong earnings during the third quarter driven by healthy gross and operating margin expansion," said Blake Krueger, Wolverine Worldwide's Chairman, Chief Executive Officer and President in a statement, adding, “Underlying revenue growth in the third quarter was positive, and we expect underlying revenue growth for the fourth quarter to improve meaningfully as our growth initiatives take hold especially for our two largest brands, Merrell and Sperry."
Wolverine Worldwide raises outlook
"The company remains on track to invest up to 45 million dollars in incremental investments to drive future growth as part of our Global Growth Agenda. We expect the fourth quarter to benefit from these investments, resulting in underlying revenue growth of 3 percent to 5 percent compared to the prior year. We expect Merrell to deliver low-teens growth and Sperry to deliver high-single-digit growth in the quarter. Growth in our ecommerce business is also expected to remain very strong in the fourth quarter," added Krueger.
Updating its revenue and earnings projections for the full year, the company said, revenue is now expected to be approximately 2.24 billion dollars, representing 2.5 percent underlying growth for the full year. The updated guidance includes the fourth quarter impact from weakness in the Latin America region and the bankruptcy of a work boot customer.
Gross margin is now expected to expand approximately 150 basis points compared to the adjusted prior year. Reported operating margin is now expected to be approximately 11.7 percent, and adjusted operating margin is now expected to be approximately 12.1 percent. Reported diluted EPS are now expected to be between 2.09 dollars to 2.13 dollars and adjusted diluted EPS to be between 2.12 dollars to 2.16 dollars, an increase over our previous outlook.