Wolverine Reports Revenue Decline in Q3 Amid New Layoffs – Footwear News

Wolverine Reports Revenue Decline in Q3 Amid New Layoffs – Footwear News

Shares of Wolverine Worldwide fell nearly 5 percent in premarket trading on news of further cost cutting after another difficult quarter.

The Rockford, Michigan-based company reported its third-quarter revenue fell 23.7 percent to $527.7 million versus $691.4 million in the same period last year. The company’s international revenues decreased by 24.4 percent to $229.0 million compared to the previous year, while its direct-to-consumer revenues decreased by 14.5 percent to reach $136.6 million compared to the same period last year. Net earnings in the third quarter were $9.0 million, down from $38.8 million in the third quarter of 2022.

In terms of brand, Sperry’s – which could be sold soon – faced the biggest difficulties in the third quarter, with revenue falling 41.4 percent to $46.2 million. Merrill fell 24.3 percent to $157.0 million, while Socony’s revenue fell 14 percent to $116.4 million. The company’s namesake Wolverine brand fell 4.7 percent during the period to $56.3 million. Sweaty Betty was the bright spot, seeing revenue increase 19 percent to $45.0 million.

According to Wolverine Worldwide Executive Vice President and CFO Mike Stornant, the company’s Saucony and Sweaty Betty businesses have “stabilized” and are showing signs of improvement. However, Merrill continues to “operate in a challenging outdoor category,” and its WG brands continue to face headwinds in wholesale demand.

The CFO also noted that the company’s review of strategic alternatives for the Sperry brand is progressing, and that Wolverine is pursuing the sale of other non-core assets in the fourth quarter. (He did not clarify what assets he was referring to.) This follows the company’s recent sale of Keds as well as the intellectual property of Hush Puppies in China, Hong Kong and Macau, and the sale of Wolverine Leathers’ North American business to Wolverine Leathers North America. New balance.

The news comes at the same time the company announced a new round of layoffs as part of a plan to generate approximately $215 million in annual savings in 2024.

Chris Hufnagel, president and CEO of Wolverine Worldwide, said in a statement that the company took “decisive actions” to stabilize and transform the business.

“While market conditions remain challenging, we are taking the necessary steps to revitalize our brands and position the company for profitable growth as conditions improve,” Hufnagel said. “We are confident in our brands, our platforms, and, most importantly, in our people. We are executing our business more boldly and at greater pace to improve our profitability and enable future investments focused on our greatest growth opportunities – all aimed at delivering greater value to our shareholders.”

Looking ahead, Wolverine Worldwide is lowering its fourth-quarter revenue forecast to a range of $515 million to $525 million and adjusted diluted earnings per share to a low range of $0.25 to $0.30.

For the full fiscal year, the company expects revenue to be approximately $2.19 billion to $2.20 billion, which represents a decline of approximately 13 percent compared to the previous year.

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