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Steven Madden (SHOO) Q4 Earnings In Line, Revenues Down Y/Y

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Steven Madden, Ltd. (SHOO - Free Report) reported fourth-quarter 2022 results, wherein the top line beat the Zacks Consensus Estimate while the bottom line met the same. However, both revenues and earnings declined year over year.

Going ahead, management remains cautious in the near term owing to a tough operating backdrop and conservative early spring orders from the company’s wholesale customers as they prioritize inventory control. Nonetheless, the company looks forward to maneuvering these market conditions with its robust business model and solid execution of its strategies.

Over the past three months, shares of this presently Zacks Rank #3 (Hold) player have increased 9.3% compared with the industry’s 6.1% gain.

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Q4 Highlight

Steven Madden posted adjusted quarterly earnings of 44 cents a share that met the Zacks Consensus Estimate. The same decreased from 87 cents reported in the prior-year period.

Total revenues fell 18.6% year over year to $470.6 million. While net sales of $468.2 million decreased 18.6%, commission and licensing fee income of $2.5 million declined 24.2% from the year-ago period’s level. The top line came above the Zacks Consensus Estimate of $468 million.

Gross profit tumbled 16.6% year over year to $198.7 million. However, the gross margin expanded 100 basis points (bps) to 42.2%. Gross profit as a percentage of wholesale revenues contracted 130 bps to 30.5%, driven by increased closeouts versus the year-earlier period when closeout activity was low. However, gross profit as a percentage of direct-to-consumer revenues, increased 50 bps to 64% owing to lower air freight expenses.

Adjusted operating expenses jumped 3.3% year over year to $156.5 million. Also, as a percentage of revenues, adjusted operating expenses expanded 700 bps to 33.2%.

Steven Madden reported an adjusted operating income of $42.2 million, down 51.4% from $86.9 million registered in the same quarter a year ago. The adjusted operating margin contracted 600 bps to 9%.

Segmental Performance

Revenues for the Wholesale business decreased 24.8% year over year to $308.8 million. We note that Wholesale footwear revenues fell 25.5% year over year, while Wholesale accessories/apparel revenues were down 22.8%.

Direct-to-consumer revenues dipped 3.2% to $159.3 million, driven by a decrease in the brick-and-mortar business, partly offset by a modest rise in the e-commerce unit.

Steven Madden ended the third quarter with 232 brick-and-mortar retail outlets, six e-commerce websites and 20 company-operated concessions across international markets.

Other Financial Aspects

Steven Madden ended the reported quarter with cash and cash equivalents of $274.7 million, short-term investments of $15.1 million and stockholders’ equity of $831.6 million, excluding non-controlling interest of $12.3 million. Management incurred capital expenditures of $16.4 million in 2022.

In the reported quarter, SHOO repurchased $36.8 million of its common stock, including shares acquired via the net settlement of employees’ stock awards. In 2022, it bought back nearly $148.9 million of the common stock. Moreover, the board approved a quarterly cash dividend of 21 cents per share, payable Mar 24, 2022, to its stockholders of record as of Mar 10, 2023.


Steven Madden issued its guidance for 2023. Management now projects revenues to decline 6.5-8% from the last year’s level. SHOO envisions earnings per share (EPS) of $2.40-$2.50 for the year.

In 2022, Steven Madden reported revenues of $2.1 billion and adjusted EPS of $2.80.

Eye These Solid Picks

Here we have highlighted three better-ranked stocks, namely, Oxford Industries (OXM - Free Report) , lululemon athletica (LULU - Free Report) and Skechers (SKX - Free Report) .

Oxford Industries, which designs, sources, markets, and distributes lifestyle products and other brands, currently carries a Zacks Rank #1 (Strong Buy). Oxford Industries has a trailing four-quarter earnings surprise of 18.9%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for OXM’s current financial-year EPS suggests growth of 10.4% from the year-ago reported number.

lululemon athletica is a yoga-inspired athletic apparel company. LULU has a Zacks Rank #2 (Buy) at present.

The Zacks Consensus Estimate for lululemon athletica’s current financial-year sales and EPS suggests growth of 14.3% and 14.8%, respectively, from the year-ago corresponding figures. LULU has a trailing four-quarter earnings surprise of 6.7%, on average.

Skechers, a footwear dealer, has a Zacks Rank of 2 at present. SKX has a trailing four-quarter earnings surprise of 3.8%, on average.

The Zacks Consensus Estimate for Skechers’ current financial-year sales and EPS suggests growth of 6.4% and 24%, respectively, from the year-ago corresponding figures.

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