Reebok third quarter sales defy wider market gloom
Athletic footwear maker Reebok last week surprised Wall Street by posting an 18% hike in third-quarter earnings.
For the quarter ending September 30, the company recorded earnings of $42.2 million, or 66 cents per share – a cent above analyst’s top-end expectations. This compares with $32.3 million, or 56 cents per share, in the year-before period.Revenue climbed 7.6% to $847.2 million from $787.8 million a year ago.
Commented Chairman and chief executive Paul Fireman: "Since September 11th, we’ve begun to see certain trends emerge in the various channels of distribution in which our brands conduct business in the United States. Many consumers have reduced their travel to certain retail destinations and consumers, in general, are purchasing fewer non-essential products. As a result, retailers are being more conservative in their buying patterns.
"It appears that since September 11th certain department stores and sporting goods retailers are experiencing comparative store sales declines whereas many athletic specialty retailers have recently indicated that their business has returned to normal pre-9/11 levels. These factors have had a modest impact on our results in the quarter, most particularly in our specialty businesses; but they are causing us to be somewhat more cautious in the way we view our business for the balance of 2001 and at least for the first half of 2002 given the uncertainty of the times."
Reebok U.S. footwear sales were $234.4 million, only slightly above last year's mark. However, U.S. apparel sales grew 122% to $134.3 million. Sales rose 13.1% to $714.8 million for the Reebok brand. The company's Rockport subsidiary saw sales decline by 7.4% to $107.6 million, with the bulk of the decline occurring post September 11. For the nine months ending Sept. 30, earnings climbed to $97.6 million, or $1.56 per share up from $74.7 million, or $1.30 a share, a year ago. Nine-month revenues were down from $2.33 billion a year ago to $2.24 billion.
