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Crocs earnings beat Wall Street expectations
Associated Press, May 4, 2006
DENVER (AP) – Trendy sandal-maker Crocs Inc. said Thursday that net profit for its first quarter since going public had doubled over the previous year, beating Wall Street expectations.
Crocs reported net income of $6.4 million, or 17 cents per share, on revenue of $44.8 million. That was up from net income of $2 million, or 6 cents per share, on revenue of nearly $11 million in the same quarter last year.
Analysts surveyed by Thomson Financial expected net income of 14 cents per share.
President and CEO Ron Snyder credited robust demand for a growing number of styles, with more designs and colors like turquoise, gold and silver on the way.
Niwot-based Crocs Inc. started selling its colorful, lightweight, odor-resistant shoes made of an anti-slip resin it calls “croslite” in 2002, when it reported $24,000 in revenues and 1,500 pairs sold.
Sales have grown several times over, with revenues for shoes, accessories and clothing hitting $108.6 million last year. The company sold 6 million pairs of shoes last year, and some have popped up on celebrities.
“It’s a great product made of a great material,” Snyder said. “They’re worn by the largest demographic of any single footwear product in a long time. We’re worn by 2- year-olds all the way up to senior citizens over 100. We’re used for casual comfort, maybe even some fashion now.”
The cost of sales was $21 million, or 47 percent of revenue in the quarter, up from $4.1 million, or about 38 percent of revenue, a year ago.
Crocs said Thursday it expected sales for 2006 to almost double to $200 million to $205 million, with net income forecast at 77 cents to 79 cents per share. For the second quarter, Crocs expected $53 to $55 million in revenue and net income of 21 cents to 22 cents per share.
Shares have risen by roughly half since they were first offered at $21 on Feb. 8. Shares were up 60 cents, or 1.9 percent, to $32.10 on the Nasdaq Stock Market Thursday before the quarterly results were announced.
The more successful Crocs gets, the more it has drawn imitators that threaten to undersell its shoes, which go for $29.99 to $59.99. Federal lawsuits filed against 11 companies alleging patent infringement are pending.
“We’re going to diligently continue to go after these guys and keep them out of the market. Early indications are quite positive,” Snyder said.
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