Business news : Crocs Lowers Forecast on Weak Results in the Americas

Crocs Inc. lowered its guidance for revenues and earnings in the third quarter ending Sept. 30 due to weak at-once orders and direct-to-consumer sales in the Americas.

The company now expects revenue between $285 million and $295 million and GAAP diluted earnings per share between 15 and 18 cents. This compares with the prior financial outlook for the third quarter of 2013 provided on July 24, 2013, of revenue between $300 million and $310 million and GAAP diluted earnings per share between 20 and 23 cents. The present and previous financial outlook both include  a 2 cent per share of ERP implementation expense and 4 cent per share for adverse foreign currency translation.

The present financial outlook reflects continued weakness in the company’s Americas region where at once orders in the wholesale channel, as well as performance in the direct-to-consumer channel, are both below prior expectations. However the company expects third quarter 2013 gross margins to be generally in-line with prior year performance. The softness in the Americas region during the third quarter is somewhat offset by stronger than expected revenue and comparable store performance in the company’s Asia Pacific and Europe regions.

“While revenue for the third quarter of 2013 is coming in below our prior forecasted outlook because of lower than expected revenue in the Americas region, we are very satisfied to date with our Asia Pacific and Europe retail sales performance in the quarter,” said John McCarvel, president and CEO. “We are pleased with the early indications of strong demand from our wholesale customers for spring/summer 2014 product, as pre-books for these products are presently running ten percent ahead of last year. We believe our brand is well positioned to take advantage of our customers demand for colorful and fun footwear in 2014.”

Final financial information will be available when the company reports its third quarter 2013 results in October 2013.

Crocs also said it is actively working to adjust its capital allocation strategy by the end of the fourth quarter of 2013. This strategy, would allow the company to maximize returns by opportunistically deploying from $80 million to $100 million of domestic cash to fund potential stock repurchases or other strategic investments in the future.

Crocs updated its guidance due to its appearance at Goldman Sachs 20th Annual Global Retailing Conference in New York City on Sept. 10. It is also presenting at the CL King 11th Annual Best Ideas Conference 2013 in New York City on Sept. 11.

By press release through sportsonesource