Deckers experiences better than expected sales in Q2

Second Quarter Review

• Net sales increased 13.1% to $174.4 million compared to $154.2 million for the same period last year.
• Gross margin was 42.2% compared to 42.7% for the same period last year.
• Diluted loss per share was $(0.53) compared to $(0.19) for the same period last year.
• UGG brand sales decreased 0.3% to $107.9 million compared to $108.3 million for the same period last year.
• Teva brand sales decreased 15.4% to $34.1 million compared to $40.3 million for the same period last year.
• Sanuk brand sales (acquired on July 1, 2011) were $28.0 million for the second quarter of 2012.
• Domestic sales increased 37.1% to $113.5 million compared to $82.8 million for the same period last year.
• International sales decreased 14.7% to $61.0 million compared to $71.5 million for the same period last year.
• Retail sales increased 25.0% to $25.2 million compared to $20.1 million for the same period last year; same store sales increased 6.8% for the thirteen weeks ending July 1, 2012 compared to the thirteen weeks ending July 3, 2011.
• eCommerce sales increased 40.1% to $8.0 million compared to $5.7 million for the same period last year.

“We experienced better than expected sales trends in several areas of our business during the second quarter,” stated Angel Martinez, President, Chief Executive Officer and Chair of the Board of Directors. “Sell-through of the UGG brand in our direct to consumer channel was higher than planned; highlighted by a 43.9% increase in eCommerce sales year over year and a 6.8% same store sales increase.

“Along with record domestic wholesale sales for the UGG and Teva brands and the addition of the Sanuk brand, we were able to more than offset declines in our European wholesale and distributor divisions and drive overall second quarter sales above our initial projections.”

“With more than half the year behind us, I am pleased with how our organization has navigated through this difficult operating environment,” continued Martinez. “We remain confident about the strength of our brands and their respective long-term growth prospects.

“This sentiment was underscored by the Board of Directors’ recent decision to authorize a new $200 million stock repurchase program, which comes on top of the $100 million stock repurchase program announced in February 2012 and completed during the second quarter of 2012.”

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Deckers Outdoor Corporation