• Q4 profit of $11.2m versus $1.3m loss
  • Revenue increases 9.2% to record $808.9m
  • Company lifts fiscal 2015 guidance

US clothing and footwear business Wolverine Worldwide has lifted its 2015 outlook after strong sales growth helped it return to profit in the fourth quarter.

The company's net earnings reached US$11.2m for the three months to 3 January, compared to a loss of $1.3m in the same period of the prior year. 

Revenue increased 9.2% to record $808.9m from $740.8m the year before, with each of the company's three brand operating groups contributing to the growth.

Gross margin, however, fell 10 basis points to 37.1% from 37.2%, primarily due to a negative mix shift in international markets, the impact of inventory liquidation related to the company's strategic realignment plan and incremental LIFO expense.

During the full year, net earnings jumped 32.6% to $133.9m from $101m in the prior year period. Revenue climbed 2.6% to $2.76bn from $2.69bn in the prior year, driven by high single-digit growth from the Heritage Group and a mid single-digit increase from the Performance Group.

Thanks to the significantly stronger US dollar versus the Canadian dollar, euro and British pound, Wolverine now expects fiscal 2015 adjusted earnings per share to range from $1.53-1.60. This compares to its previous guidance of $1.43.

Revenue is expected to be between $2.82bn and $2.87bn, representing year-on-year growth of 2-4%, compared to its previous forecasts of mid-single digit revenue growth.

"The significant incremental investments we are planning for 2015 - which we expect to benefit primarily fiscal 2016 and beyond - represent the next step in achieving the company's vision of building the most admired family of performance and lifestyle brands on earth," said chairman, president and CEO Blake Krueger.

"We believe 2015 is the right time to make these investments and expect this, along with our ongoing global expansion strategies, to position our company for accelerated growth and drive significant future shareholder value."  

Sterne Agee analyst Sam Poser said the current guidance is "not bulletproof but seems realistic". Commenting on the group's Sperry brand, he added: "While we believe the worst may be over for Sperry, we contend that a return to 2012/2013 growth levels is a long way away."

"We believe that new brand president Rick Blackshaw has what it takes to turn the business around based on his results in Keds; however, based on when he took over the brand, we do not see material momentum changes occurring until spring 2016."