Deckers Brands, a prominent player in the industry renowned for its inventive footwear, apparel, and accessories, has unveiled its financial performance for the third fiscal quarter concluding on December 31, 2023. Alongside this disclosure, the company has also furnished insights into its projected financial trajectory for the entire fiscal year, slated to conclude on March 31, 2024.
"Our brands delivered Deckers' largest quarter in history, with record revenue and earnings as both HOKA and UGG drove exceptional performance in the quarter, led by our DTC channel and high levels of full price selling," said Dave Powers, President and Chief Executive Officer. "Global gains in awareness, combined with elevated consumer connections and innovative product offerings, continued to drive unparalleled demand for our brands. This, coupled with our disciplined operating approach, dedicated focus on marketplace management and fortified balance sheet, puts Deckers in a position of strength as we enter our last fiscal quarter of 2024. We believe HOKA and UGG are two of the healthiest brands in the industry and we remain focused on executing against our strategic initiatives to drive long-term future success."
In the third fiscal quarter ending December 31, 2023, Deckers Brands witnessed significant growth across various metrics. Net sales surged by 16.0%, totalling $1.560 billion, compared to $1.346 billion in the same period last year. On a constant currency basis, this increase amounted to 15.1%. Direct-to-Consumer (DTC) net sales saw a remarkable uptick of 22.7% to $858.1 million, with DTC comparable net sales also rising by 21.8%. Wholesale net sales increased by 8.6% to $702.2 million. Geographically, domestic net sales climbed by 15.6% to $1.048 billion, while international net sales saw a surge of 16.7% to $511.9 million. Gross margin expanded to 58.7% from 53.0%, showcasing improved profitability. Selling, general, and administrative (SG&A) expenses rose to $428.7 million from $349.9 million, while operating income increased to $487.9 million from $362.7 million. Diluted earnings per share also grew substantially to $15.11 from $10.48. In terms of brand performance, UGG brand net sales increased by 15.2%, reaching $1.072 billion, and HOKA brand net sales grew by 21.9% to $429.3 million. However, Teva brand net sales experienced a decrease of 16.2% to $25.6 million, and Sanuk brand net sales declined by 28.9% to $4.0 million. Other brands, primarily Koolaburra, witnessed a 10.0% increase in net sales to $29.6 million. Looking at the balance sheet, as of December 31, 2023, cash and cash equivalents amounted to $1.651 billion, compared to $1.058 billion on December 31, 2022. Inventories decreased to $539.0 million from $723.4 million, and the company had no outstanding borrowings during this period.
