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May 20, 2022

US Q4 in brief – VF Corp, Boot Barn Holdings, PVH Corp

We take a look at the latest fourth-quarter filings from US apparel and footwear brands and retailers.

The latest filings from US fashion firms include:

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VF Corporation

VF Corp reported a revenue increase of 9% (up 12% in constant dollars) to US$2.8bn for the fourth quarter, with the rise driven by increases in the EMEA and North America regions partially offset by a decline in the APAC region primarily due to Covid lockdowns. Net income amounted to $80.8m, compared to $89.5m a year prior, while gross margin decreased 20 basis points to 51.9%, primarily driven by incremental freight costs. On an adjusted basis, gross margin decreased 50 basis points to 52.2%.

For the full year, revenue increased 28% (up 27% in constant dollars) to $11.8bn. Excluding the impact of acquisitions, revenue increased 23%, driven by increases in our largest brands and regions. Net income, meanwhile, was $1.39bn, up from $407.87m last time. Gross margin increased 180 basis points to 54.5%, primarily driven by a higher proportion of full-price sales more than offsetting incremental freight costs. On an adjusted basis, gross margin increased 150 basis points, including a 20 basis point positive impact from acquisitions, to 54.8%.

CEO Steve Rendle said: “I am pleased with the progress we have made advancing our strategic priorities while successfully navigating another eventful year. We largely delivered on the commitments we made at the outset of Fiscal 2022 by achieving broad-based growth across our family of brands. A portion of our active segment did not achieve its potential. We understand the issues, we have the right people in place and we know we will do better.

Boot Barn Holdings

Boot Barn Holdings said for the quarter ended 26 March, net sales increased 48.1% over the prior-year period to US$383.3m. Same-store sales were up 33.3% compared to the prior-year period, comprised of an increase in retail store same-store sales of 30.7% and an increase in e-commerce same-store sales of 49.5%. Net income was $44.7m, compared to $24.6m, while gross margin expanded to 38.8% from 35.7% a year earlier.

For the full year, net sales increased 66.6% to $1.49bn, while same-store sales were up 53.7%. Net income was $192.5m, compared to $59.4m, while gross margin was 38.6%, compared to 33% in the prior-year period.

PVH Corp

PVH Corp CEO Stefan Larsson said the company delivered strong fourth-quarter revenue and earnings above guidance. Overall revenue for the period increased 16% to US$2.43bn (increased 20% on a constant currency basis), compared to the prior-year period. The increase reflects an 18% rise (23% in constant currency) in the Tommy Hilfiger business, a 27% increase (30% in constant currency) at Calvin Klein, and a 33% decrease in the Heritage Brands business. The latter included a 51% decrease resulting from the Heritage Brands transaction and the exit from the Heritage Brands retail business. Revenue through digital channels grew about 10%, while total direct-to-consumer revenue was up 13%, inclusive of a 4% reduction from the exit of the Heritage Brands retail business. Directly operated digital commerce was flat to what PVH called the “exceptionally strong” performance of 68% growth in the prior year. Net income, meanwhile, amounted to $390.8m, compared to a net loss of $57.7m last time. Overall gross margin widened to 58.3% from 53.9%, driven largely by more full-price selling and a favourable shift in regional sales mix.

For the full year, revenue increased 28% to $9.16bn (26% in constant currency) compared to 2020, with a 29% rise (27% in constant currency) at Tommy Hilfiger, a 39% hike (36% in constant currency) at Calvin Klein business, and an 8% decrease at Heritage Brands. Net income was $952.3m, compared to a net loss of $1.14bn a year earlier.

Revenue in 2022 is projected to increase 2-3% (6-7% on a constant currency basis) as compared to 2021. This reflects a 2% reduction resulting from the Heritage Brands transaction and the exit from the Heritage Brands retail business and a 2% reduction from the company’s decision to temporarily close its stores and pause commercial activities in Russia and Belarus, as well as a reduction in wholesale shipments to Ukraine as a result of the war.

J.Jill

J. Jill said total net sales for the 13 weeks ended 29 January were up 15.3% to US$145.2m from $125.9m in the prior-year quarter. Total company comparable sales, which includes comparable store and direct-to-consumer sales, increased by 19.7%. Direct-to-consumer net sales were down 8.8% over 2020 driven by lower markdown sales and represented 52.1% of total net sales. Net Income was $3.6m compared to a net loss of $26.9m a year earlier. Gross margin was 63.9% compared to 56.7% in the fourth quarter of fiscal 2020, with the increase driven by strong full price selling and reduced promotions which more than offset about 300bps of freight expense due to supply chain disruption.

For the full year, total net sales were up 37.1% to $585.2m, with total company comparable sales up 23.4%. Net loss for the period was $28.1m, which includes $59.8m of charges, compared to a loss of $139.4m a year prior. Gross margin widened to 67.4% from 57.6%.

For the first quarter of fiscal 2022, the company expects revenues to grow between 11-14% compared to the first quarter of fiscal 2021.

Lands’ End

Lands End CEO Jerome Griffith said the company generated the highest revenue since 2011 for the 12 months ended 28 January, with net revenue increasing 14.7% to US$1.64b from $1.43bn in the prior year. Net income was $33.4m compared to $10.8m in fiscal 2020.

For the fourth quarter, net revenue increased 3.2% to $555.4m, compared to $538.4m in the prior-year period. Global e-commerce net revenue was $441.5m, a decrease of 4.4% on last year as a result of shipping delays caused by supply chain challenges. Net income was $7.1m, as compared to $19.9m in the fourth quarter of fiscal 2020, while gross margin decreased about 360 basis points to 35.9% due to increased shipping costs driven by the global supply chain challenges.

For fiscal 2022, the company expects net revenue to be between $1.68-$1.75bn, and net income of between $24-$35m.

Caleres

Caleres CEO Diane Sullivan says the company capped off an “exceptional” 2021 performance with record-setting fourth-quarter results, providing significant momentum as it heads into fiscal 2022. For the three months ended 29 January, net sales were US$679.3m, up 19% from the fourth quarter of fiscal 2020. Caleres reported a 15.9% sales increase in the Famous Footwear segment, and a 24.4% sales rise in the Brand Portfolio segment, while direct-to-consumer sales represented 73.6% of total net sales. Net earnings of $33.9m, compared to a net loss of $77m in the fourth quarter of fiscal 2020, while gross margin was 43.4% or a 389-basis point improvement on last year.

For the full year, consolidated sales of $2.8bn were up 31.2% from fiscal year 2020. Net earnings attributable to Caleres, Inc amounted to $137m, compared to a net loss of $439m a year prior. Gross margin was 44.2% or an approximately 701-basis point improvement over fiscal year 2020.

Caleres expects consolidated sales to be flat to up 3% to 2021 sales and says with the momentum coming out of the fourth quarter, it expects 50% of its earnings to be in the first half of 2022.

Victoria’s Secret & Co

Victoria’s Secret & Co reported net income of US$246.1m for the fourth quarter ended 29 January, compared to $282.4m for the fourth quarter of 2020. net sales of $2.175 billion for the fourth quarter of 2021, an increase of 4% compared to net sales of $2.1bn in the prior-year fourth quarter. The result was slightly above the previously communicated guidance of sales in the range of flat to up 3%. Total comparable sales for the fourth quarter of 2021 increased 1% compared to the fourth quarter of 2020.

The company moved to a profit for the full year, reporting net income of $646.4m, compared to a net loss of $72.3m for the full year 2020. Net sales of $6.79bn were up 25% $5.41bn for 2020. Total comparable sales for the full year 2021 increased 3% compared to 2020.

Victoria’s Secret & Co is forecasting full-year 2022 sales to be in the range of flat to up low-single digits versus 2021 sales of $6.79bn.

Ross Stores

Ross Stores reported net earnings of US$366.8m for the 13 weeks ended 29 January, up from $237.98m the prior-year period. Sales for the fourth quarter of 2021 were $5b.02n, up from $4.25bn.

CEO Barbara Rentler said: “We achieved strong sales results in the fourth quarter despite the negative impact from both the surge in Omicron cases during the peak holiday selling period and continued supply chain congestion. “Fourth-quarter operating margin of 9.8% was down from 13.3% in 2019 mainly due to ongoing headwinds from higher freight, wages, and Covid-related costs.”

For the full year, sales were $18.92bn, compared to $12.53bn. Net earnings amounted to $1.72bn, up from $85.38m a year earlier.

For Fiscal 2022, Rentler said comparable-store sales are forecast to be flat to up 3% versus a 13% gain in fiscal 2021. 

Dollar Tree

Dollar Tree said for the three months ended 29 January, consolidated net sales increased 4.6% to US$7.08bn from $6.77bn in the prior year’s fourth quarter. Enterprise same-store sales increased 2.5%, while same-store sales for Dollar Tree increased 3.1%. Family Dollar same-store sales were up by 1.7%. Net income, meawhile, was $454.2m, compared to $502.8m. Gross margin was 30.2%, compared to 31.8% in the prior year’s quarter. The 160 basis point decrease was driven by higher freight costs and recall-related markdowns, partially offset by improved initial mark-on and favorable product mix, reduced shrink and leverage on distribution costs.

For the full year, consolidated net sales increased 3.1% to $26.31bn from $25.51bn in the prior year. Enterprise same-store sales edged up 1% on a constant currency basis (or 1.1% when adjusted to include the impact of Canadian currency fluctuations), when compared to the prior year. Same-store sales for Dollar Tree increased 2.1% (or 2.2% when adjusted to include the impact of Canadian currency fluctuations). Family Dollar same-store sales decreased 0.1%, representing an increase of 10.4% on a two-year stack basis. Net income was $1.33bn, down from $1.34bn a year prior. Gross margin was 29.4%, compared to 30.5% in the prior year.

Consolidated net sales for full-year fiscal 2022 are expected to range from $27.22-$27.85bn. The estimate is based on a low-to-mid single-digit increase in same-store sales and about 2.8% selling square footage growth. 

Nordstrom

Nordstrom reported fourth-quarter results in line with the company’s fiscal year 2021 outlook, demonstrating what it called progress against its long-term growth strategy. For the period ended 29 January, net sales increased 23% versus the same period in fiscal 2020, amounting to $4.38bn. Digital sales decreased 1% on last year. The company reported net earnings of $200m, up from $33m in the prior-year period.

For the full year, net sales rose to $14.4m from $10.4m last time, while net earnings amounted to $178m, compared to a net loss of $690m a year earlier.

For fiscal 2022, Nordstrom expects revenue growth, including retail sales and credit card revenues, of 5-7% versus fiscal 2021.

Abercrombie & Fitch Co

Abercrombie & Fitch Co reported net sales of US$1.2bn up 4% as compared to last year, with digital net sales representing 48% of total net sales in the period. Net income attributable to Abercrombie & Fitch for the three months to 29 January was $65.5m, compared to $82.4m.

For the full year, net sales of $3.7bn were up 19% as compared to last year, with digital net sales representing 47%. Net income was $263m, compared to a net loss of $114m a year prior.

For fiscal 2022, the company expects net sales to be up 2-4% from $3.7bn in 2021 with the US continuing to outperform EMEA and APAC. Abercrombie & Fitch expects the increase to be driven by growth in both comparable sales and store count.

American Eagle Outfitters

American Eagle Outfitters (AEO) CEO Jay Schottenstein said: “2021 was a milestone year for AEO. We crossed US$5bn in revenue for the first time in company history, grew our active customer file to record highs and achieved our strongest profit result in well over a decade.”

For the fourth quarter ended 29 January, total net revenue increased $216m, or 17% to $1.51bn from $1.29bn in the fourth quarter of 2020. Aerie revenue of $428m rose 27% from fourth quarter 2020 building on 25% growth last year. American Eagle revenue of $1.04bn rose 11% following a 9% decline last year. Consolidated store revenue was up 32%, while total digital revenue declined 3%. Net income was $50.4m, compared to $3.5m in the prior-year period. Gross margin narrowed to 32.4% from 34% last year. 

For the full year, total net revenue increased $1.3bn, or 33% to $5bn from $3.8bn in fiscal year 2020. Aerie revenue of $1.4bn rose 39% from fiscal year 2020 on top of 24% growth last year. American Eagle revenue of $3.6bn was up 30% versus fiscal year 2020 following a 21% decline last year. Reflecting migration back to stores, consolidated store revenue increased 53%. Total digital revenue increased 7%. Net income totalled $419.6m, compared to a net loss of $209.3m a year earlier. Gross margin widened to 39.7% from 30.5% last year, driven by strong product demand, higher full-priced sales, lower promotions, rent savings, customer delivery efficiencies and inventory optimisation initiatives.

AEO said it is “extremely confident” in the strength of its brands and pleased with early performance of spring collections, however, based on what it called a number of macro uncertainties, it is taking a cautious view of 2022.

“Due largely to stimulus in the first half of 2021, which contributed to an extraordinary spring season, combined with continued freight pressures, we are forecasting an earnings decline in the first half, followed by a recovery in the second half as we lap elevated air freight due to factory closures and inventory flow challenges last year,” the company said.

Kontoor Brands

“Kontoor’s solid fourth quarter and full year 2021 performance demonstrates how our strategies are working. In the quarter, we amplified strategic investments and delivered near-term results while continuing to set the foundation for greater long-term success,” said CEO Scott Baxter.

For the quarter ended 1 January, Kontoor said revenue was US$681m, a 3% increase on a reported and constant currency basis over the same period in the prior year. Excluding revenue from the 53rd week in the prior year period, revenue increased 8% on a reported and constant currency basis. US revenue was $523m, increasing 1% over the same period in the prior year, while international revenue was $158m, a 12% rise over the same period in the prior year on a reported and constant currency basis. Wrangler brand global revenue was $444m, up 1% on last year as reported and on a constant currency basis, while Lee’s global revenue was $233m, a 14% increase over the same period in the prior year on a reported and constant currency basis. Net income increased to $43.9m from $43.1m, while gross margin increased 30 basis points to 42.8%

Full-year revenue was $2.5bn, an increase of 18% on a reported basis and 17% in constant currency, while net income amounted to $195.4m, compared to $67.9m a year prior.

Revenue is expected to approximate $2.7bn in 2022, increasing at a high single digit percentage over 2021. Kontoor expects first half revenues to increase in the low teens range compared to the prior year. Gross margin is expected to be consistent with adjusted gross margin of 44.6% achieved in 2021. 

Kohl’s

Kohl’s reported total revenue of U$6.5bn for the fourth quarter, compared to $6.1bn in the prior year period, while net income was $299m, compared to $343m. Gross margin expanded to 33.2% from 32%.

For the full year, total revenue amounted to $19.4bn, up from $16bn a year earlier. Net income was $938m, compared to a net loss of $163m. Gross margin expanded to 38.1% from 31.1%.

Kohl’s expects full year 2022 net sales to increase 2-3% as compared to 2021.

Chico’s FAS

For the fourth quarter ended 29 January, Chico’s FAS reported net income of US$10.7m, compared to a net loss of $79.1m in the prior year period. Net sales were $496.3m, compared to $386.2m last time. The 28.5% improvement primarily reflects the decline in store sales during last year’s fourth quarter as a result of the pandemic and higher fourth quarter full-price sales, partially offset by 36 permanent store closures since last year’s fourth quarter. Total company comparable sales for the fourth quarter compared to last year’s fourth quarter improved 29.2%, with Chico’s, WHBM and Soma up 33.2%, 45.6% and 9.5%, respectively. Gross margin was 34.5% compared to 19% in last year’s fourth quarter. The year-over-year improvement in gross margin rate primarily reflects margin expansion as a result of higher fourth quarter full-price sales, less promotional activity and improved leverage of occupancy costs on higher sales.

For fiscal 2021, the company reported net income of $46.2m, compared to a net loss of $360.1m a year earlier. Net sales increased to $1.81bn from $1.32bn, marking a 36.7% rise.

For the fiscal 2022 full year, Chico’s FAS currently expects consolidated net sales of $2.09-$2.12bn and gross margin rate of 36.7-37.2%.

Target Corporation

“Our strong fourth-quarter performance capped off a year of record growth in 2021, reinforcing the durability of our business model and our confidence in long-term profitable growth,” said Brian Cornell, chairman and CEO of Target. 

The company’s total comparable sales grew 8.9% in the fourth quarter, reflecting comparable stores sales growth of 8.9% and digital sales growth of 9.2%. Total revenue of US$31bn grew 9.4% compared with last year, driven by sales growth of 9.4% and an 11.1% increase in other revenue. Net earnings, meanwhile, amounted to $1.54bn, up from $1.38bn in the prior-year quarter.

Full-year sales were up 13.2% to $104.6bn from $92.4bn last year, reflecting a 12.7% increase in comparable sales combined with sales from non-mature stores. Full-year revenue of $106bn grew 13.3% compared with 2020, reflecting sales growth of 13.2% and a 20.2% increase in other revenue. Net earnings, meanwhile, amounted to $6.95bn, up from $4.37bn in the prior year.

For fiscal year 2022, the company expects low- to mid-single digit revenue growth, an operating margin rate of 8 percent or higher, low-single digit growth in operating margin dollars, and high-single digit growth in Adjusted Earnings per Share.

Urban Outfitters

Urban Outfitters reported record fourth-quarter net sales of US$1.33bn for the three months ended 31 January, compared to $1.09bn for the prior-year period. Net income amounted to $40.95m, compared to $28.57m last time.

For the full year, total net sales amounted to $4.55bn, up from $3.45bn a year earlier, while net income was $310.62m, compared to $1.24m last time.

“Record fourth-quarter sales were driven by positive ‘comps’ at all brands,” said CEO Richard Hayne. “Strong customer response to our early spring offerings bode well for continued sales growth in the first quarter.” 

Foot Locker

“We closed out a record year by delivering solid fourth-quarter results that reflect the ongoing momentum we have built in our business in the midst of an evolving market,” said Foot Locker CEO and chairman, Richard Johnson. For the three months to 29 January 2022, the company reported net income of US$103m, compared with $123m for the corresponding prior-year period. Fourth-quarter comparable-store sales increased by 0.8%, with apparel significantly outpacing footwear. Total sales increased by 6.9%, to $2.3bn, compared with sales of $2.2bn a year prior. Excluding the effect of foreign exchange rate fluctuations, total sales for the fourth quarter increased by 8.2%. Gross margin remained relatively flat in the fourth quarter, decreasing by 10 basis points compared with the prior-year period, with strong merchandise margin gains offset by occupancy deleverage, which primarily reflects the elevated rent abatements in the prior year.

For the full year, net income amounted to $893m, compared with $323m in fiscal 2020. Fiscal year comparable-store sales increased by 15.4%. Total sales of $9bn increased by 18.7% compared with sales of $7.5bn in fiscal 2020. Excluding the effect of foreign exchange rate fluctuations, total sales in fiscal 2021 increased by 17.8%.

For full-year 2022, Foot Locker expects sales to be down by 4-6%.

Carter’s

Carter’s CEO Michael Casey said the company saw strong demand for its brands in the fourth quarter which enabled it to exceed its sales and earnings objectives. Consolidated net sales increased 7.3%, to US$1.06bn. On a comparable week basis, net sales grew 10.9%. On a reported basis, the company’s US retail, US wholesale, and international segments grew 3%, 9%, and 25%, respectively. US retail segment comparable sales increased 15%, driven by improved store sales. Changes in foreign currency exchange rates used for translation in the fourth quarter fiscal 2021, as compared to the fourth quarter of fiscal 2020, had a favourable effect of about $3.3m, or 0.3%. Net income decreased $2m, or 2.1%, to $97m from the prior-year period.

For the full year, consolidated net sales increased 15.3%, to $3.5bn, driven by strong growth in all segments. The additional week in fiscal 2020 contributed about $32.1m in consolidated net sales. On a comparable week basis, net sales grew 16.5%. On a reported basis, the company’s US retail, US wholesale, and international segments grew 14%, 13%, and 29%, respectively. Changes in foreign currency exchange rates had a favourable effect of about $20m, or 0.7%. Net income in fiscal 2021 increased 209.7%, to $339.7m, compared to $109.7m in fiscal 2020.

For fiscal 2022, Carter’s projects its net sales will increase by approximately 2-3%, with growth in all segments.

Dillard’s

Dillard’s CEO William Dillard, II said the company ended fiscal 2021 on a very strong note with a fourth consecutive record quarter. Net sales for the 13 weeks ended 29 January were US$2.11bn, compared to $1.56bn in the prior-year period. Net sales includes the operations of the company’s construction business, CDI Contractors, LLC (CDI). Total retail sales (which excludes CDI) for the 13-week period were $2.08bn, compared to $1.52bn last time. Total retail sales increased 37%, while sales in comparable stores for the period also increased 37%.

Net income, meanwhile, amounted to $321.2m, compared to $67m for the prior year fourth quarter. Included in net income 2022 fourth-quarter is a net tax benefit of $18m, while the prior year period includes pretax asset impairment and store closing charges of $10.7m, and a net tax expense of $19.4m. Consolidated gross margin improved to 40.8% from 31.1%.

For the full year, net sales were $6.49bm, compared to $4.3bn a year earlier, while net income for the 52 weeks was $862.5m, compared to a net loss of $71.7m for the prior year.

The TJX Companies

The TJX Companies said net sales for the fourth ended 29 January were US$13.9 billion, an increase of 27% versus the fourth quarter of Fiscal 2021. Net income amounted to $940m, compared to $325.5m a year prior, while gross profit margin was 27.1%, a 1.3 percentage point decrease on last year.

For the full year Fiscal 2022, net sales were $48.5bn, an increase of 51% versus the full year Fiscal 2021. Net income was $3.3bn up from $90.5m a year earlier, while gross profit margin was 28.5%. 

CEO Ernie Herrman said: “In a year when we grew sales to nearly $50 billion, we are very confident in our goal of TJX becoming an increasingly profitable, $60 billion-plus company.”

Macy’s

Macy’s CEO Jeff Gennette said the department store retailer’s results in the fourth quarter delivered a strong end to a solid year. Net sales for the 13 weeks to 29 January amounted to US$8.67bn, compared to $6.78bn a year prior. Comparable sales were up 28.3% on an owned basis and by 27.8% on an owned-plus-licensed basis versus the fourth quarter of 2020. Digital sales increased 12% on last year, with digital penetration 39% of net sales, a five percentage point decline from the fourth quarter of 2020. Net income, meanwhile, rose to $742m from $160m a year ago. Gross margin for the quarter was 36.5%, up from 33.7% last time.

For the full year, net sales rose to $24.46bn from $17.35bn a year earlier. Comparable sales were up 43% on an owned basis and up 42.9% on an owned-plus-licensed basis versus 2020, while digital sales increased 13% versus 2020. Digital penetration was 35% of net sales, a nine percentage point decline from 2020. Net income, meanwhile, amounted to $1.43bn, compared to a net loss of $3.94bn a year earlier. Gross margin for the year was 38.9%, up from 29.2% in 2020.

Macy’s expects net sales for Fiscal 2022 to range between $24.46-$24.7bn, representing flat to up 1% growth versus 2021.

Walmart

US retail giant Walmart, Inc has hailed strong holiday results globally, with total revenue for the three months ended 31 January amounting to US$152.9bn, up 0.5% on last year. Walmart said the numbers were negatively affected by $10.2bn due to divestitures. Walmart US posted a 5.7% rise in net sales to $105.3bn, with e-commerce sales growing 1% and 70% on a two-year stack. Operating income was flat at $5.2bn. Net sales at Walmart International, meanwhile, amounted to $27bn in the quarter, a decrease of 22.6%, with sales negatively affected by $10.1bn due to divestitures. Operating income fell 13.7% to $0.8m, and by 12% in constant currency. Consolidated net income attributable to Walmart, meanwhile, was $3.56bn, compared to a consolidated net loss of $2.09bn in the prior-year quarter.

For the full year, total revenue was $572.8bn, up 2.4% on the prior year, and negatively affected by $32.7bn related to divestitures. Excluding currency, total revenue would have increased 1.6% to $568.2bn. Net sales at Walmart US increased 6.3% on the prior year to $393.2bn, while those at Walmart International decreased 16.8% to $101bn, negatively affected by about $32.6bn related to divestitures. Consolidated net income attributable to Walmart for the year amounted to $13.67bn, compared to $3.51bn a year earlier.

For fiscal year 2023, Walmart expects consolidated net sales to increase about 3% in constant currency, and consolidated operating income to rise by about 3% in constant currency.

Crocs

“A strong 2021 holiday season completed a very successful year for our brand. We achieved incredible results with record revenues of US$2.3bn, 67% revenue growth and an industry-leading 30% operating margin,” said Crocs CEO Andrew Rees.

For the three months ended 31 December, Crocs recorded revenues of $586.6m, an increase of 42.6% from the same period last year, or 43.5% on a constant currency basis. Direct-to-consumer (DTC), which includes retail and e-commerce, revenues grew 44.5% and wholesale revenues grew 40.3%. Net income amounted to $154.85m, compared to $183.33m a year prior, while gross margin of 63.4% and adjusted gross margin of 63.7% both increased 770 basis points compared to the same period last year.

For the full year, Crocs posted record revenues of $2.31bn, marking an increase of 66.9%, or 65.2% on a constant currency basis, over 2020. Net income, meanwhile, increased to $725.69m from $312.86m a year earlier. Gross margin of 61.4% increased 730 basis points compared to 54.1% last year. Adjusted gross margin of 61.6% rose 700 basis points.

Crocs said it expects the Heydude acquisition to close in February, and revenue growth for the Crocs brand, excluding Heydude, to exceed 20% in full-year 2022, compared to 2021. Revenues for Heydude are expected to be about $700-$750m, including the period of time prior to the closing of the acquisition, and $620-$670m on a reported basis. Gross margin is anticipated to include an incremental $75m of air freight in the first half of 2022.

Columbia Sportswear Company

Columbia Sportswear reported record fourth-quarter net sales of US$1.13bn for the period ended 31 December, up 23% on last year. Net income increased 64% to $157m from $95.8m last time, while gross margin expanded 160 basis points to 52.2% from 50.6% for the comparable period in 2020. Gross margin expansion was primarily driven by lower direct-to-consumer (DTC) promotional levels, strong retail sell-through performance resulting in higher wholesale product margins, and favourable channel sales mix, partially offset by higher inbound freight costs and year-over-year changes in inventory provision activity.

For the full year, net sales grew 25% on last year to $3.13bn, while net income surged 228% to $354.1m from $108m last time. Gross margin expanded 270 basis points to 51.6%.

Chairman, president and CEO Tim Boyle said: “Fourth quarter and full-year financial results were exceptional. In the quarter, robust consumer demand led to results that far exceeded our financial outlook driven by DTC outperformance and a highly favourable full-price selling environment, which benefited gross margin.”

For full-year 2022, net sales are expected to increase 16-18% to $3.63-$3.69bn, while net income is forecast between $359m and $379m. Gross margin is expected to contract about 160 basis points to about 50%.

Skechers USA

Skechers said fourth-quarter sales increased 24.4% to US$1.65bn for the three months ended 31 December, as a result of a 9.8% increase in domestic sales and a 34% increase in international sales. On a constant currency basis, the company’s total sales increased 24.5%. Net earnings amounted to $402.4m and included a tax benefit of $346.8m resulting from an intra-entity transfer of certain intellectual property rights, partially offset by $15m related to the settlement of multiple legal matters. This compares to net earnings of $53.3m a year earlier. Gross margin was 48.6%, a decrease of 30 basis points, primarily driven by higher freight costs.

Full-year sales increased 36.7% reflecting a 33.4% increase in domestic sales and a 39% increase in international sales with the largest contribution derived from international wholesale growth. On a constant currency basis, total sales increased 33.7%. Gross margin increased 170 basis points to 49.3%, while net earnings were $741.5m, compared to $98.6m a year prior.

For the first quarter of 2022, Skechers believes it will achieve sales between $1.68bn and $1.73bn, while for fiscal year 2022, sales are forecast between $7bn and $7.2bn.

HanesBrands

HanesBrands said net sales from continuing operations for the fourth quarter ended 1 January totalled US$1.75bn, an increase of $63m, or 4%, including 10% growth in Champion brand sales globally. Excluding $28m in sales of personal protective equipment (PPE) and $45m of sales from a 53rd week in the prior period, and a $9m headwind from exchange rates in the current period, net sales increased $146m, or 9%, over the prior year. Innerwear sales increased 3% over last year, excluding PPE, driven by point-of-sale growth across channels. Activewear sales, meanwhile, grew $46m, or 11% over the prior year driven by strong point-of-sale trends across its activewear brands. For the fourth-quarter 2021, GAAP gross margin of 38.1% increased 3,220 basis points compared to the prior year. On a GAAP basis, income from continuing operations amounted to $68m, compared to a loss from continuing operations of $292m in the prior-year period.

Looking ahead, for the first-quarter of 2022, Hanes currently expects net sales from continuing operations of about $1.51bn-$1.57bn. For fiscal-year 2022, net sales are forecast at $7bn-$7.15bn. 

The company has also raised its 2024 Full Potential financial targets and announced its intention to sell its US Sheer Hosiery business.

Levi Strauss & Co

Levi Strauss & Co (LS&Co) reported net revenues of US$1.7bn for the three months ended 28 November, marking a 22% rise on the prior-year period and a 7% increase compared to the fourth quarter of 2019. Net income amounted to $153m with adjusted net income of $170m, up from $81m a year ago and $108m in the pre-pandemic fourth quarter. CEO Chip Bergh said the company’s strong brand equity helped it to retain its pricing power, while diversifying across product categories led to its strong finish in 2021.

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