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Skechers USA Q2 net sales increased to $877.8 million

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Staff Writer |
Skechers
Skechers USA   Gross profit was $416.3 million

Skechers USA announced financial results for the second quarter ended June 30, 2016. Net sales were $877.8 million compared to $800.5 million for Q2 2015.

Gross profit was $416.3 million, or 47.4 percent of net sales, compared to $374.6 million, or 46.8 percent of net sales, for the second quarter of last year.

Earnings from operations for the second quarter of 2016 were $100.4 million, or 11.4 percent of net sales, compared to earnings from operations of $112.3 million, or 14.0 percent of net sales for the second quarter of 2015.

Net earnings in the second quarter of 2016 were $74.1 million compared to net earnings of $79.8 million for the second quarter of 2015.

Diluted net earnings per share in the second quarter of 2016 were $0.48 based on 155.0 million weighted average shares outstanding compared to diluted net earnings per share of $0.52 based on 154.0 million weighted average shares outstanding for the same period last year.

Skechers' diluted earnings per share for the second quarter of 2016 were negatively impacted by several factors including foreign currency translation and exchange losses of $8.3 million, or $0.05 per diluted share.

In addition, the company had G&A expenses for additional VAT taxes in Brazil of $2.7 million and a fire in its Malaysia warehouse, which resulted in a pre-tax loss of approximately $0.9 million.

These factors reduced diluted earnings per share by $0.02. In addition, the company’s annual effective tax rate for the second quarter was 12.7 percent, and 18.1 percent for the first six months, which increased its net earnings and diluted earnings per share.

Skechers' annual effective tax rate is significantly lower than its previous guidance, primarily due to reduced projected domestic earnings combined with increased projected earnings from its China operations, which has a lower tax rate than its U.S. effective tax rate.

For the six months ended June 30, 2016, net sales were $1.86 billion compared to net sales of $1.57 billion in the first six months of 2015. Gross profit for the first six months of 2016 was $848.4 million, or 45.7 percent of net sales, compared to $707.1 million, or 45.1 percent of net sales, for the first six months of 2015.

Earnings from operations for the first six months of 2016 were $238.9 million, or 12.9 percent of net sales, compared to earnings from operations of $200.5 million, or 12.8 percent of net sales, for the first six months of 2015.

Net earnings in the first six months of 2016 were $171.7 million compared to net earnings of $135.9 million in the same period last year.

For the first six months of 2016, diluted net earnings per share were $1.11 based on 154.9 million weighted average common shares outstanding compared to diluted net earnings per share of $0.88 based on 153.8 million weighted average common shares outstanding for the first six months of 2015.


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