Raises mid-point of guidance range for
fiscal year 2024 revenue and earnings
Wolverine World Wide, Inc. (NYSE: WWW) today reported financial
results for the second quarter ended June 29, 2024.
“We delivered better-than-expected revenue and earnings in the
second quarter, while continuing to execute our ambitious
turnaround plan,” said Chris Hufnagel, President and Chief
Executive Officer of Wolverine Worldwide. “A year ago, we began to
take fast and bold actions to build a new and better Company –
focused squarely on our consumer and our new global brand-building
model. Our team has executed with tremendous pace and urgency,
driving substantial progress across the business. We've
significantly lowered our debt and inventory levels, while
meaningfully expanding our gross margin, and we’re beginning to see
proof points of an inflection to growth – driven by stronger
product pipelines and improved demand creation. Every day we’re
making progress to position the Company for sustained growth in the
future and, ultimately, to deliver better performance and greater
returns for our shareholders.”
FINANCIAL HIGHLIGHTS
Financial results for 2024, and comparable results from 2023, in
each case, for our ongoing business exclude the impact of Keds,
which was sold in February 2023, the U.S. Wolverine Leathers
business, which was sold in August 2023, the non-U.S. Wolverine
Leathers business, which was sold in December 2023, and the Sperry
business, which was sold in January 2024. Tables have been provided
in the back of this release showing the impact of these adjustments
on financial results for 2024 and 2023.
SECOND-QUARTER 2024 FINANCIAL HIGHLIGHTS
(in millions)
June 29, 2024
July 1, 2023
Y/Y Change
Constant Currency
Change
Reported Segment Revenue
Results:
Active Group
$305.9
$383.3
(20.2)%
(20.0)%
Work Group
$105.0
$117.8
(10.9)%
(11.0)%
Other
$14.3
$88.0
(83.8)%
(83.8)%
Total Revenue
$425.2
$589.1
(27.8)%
(27.7)%
Ongoing Total Revenue
$424.8
$520.8
(18.4)%
(18.3)%
Supplemental Revenue
Information
Merrell
$142.7
$176.7
(19.2)%
(18.9)%
Saucony
$102.0
$141.7
(28.0)%
(27.6)%
Wolverine
$40.1
$41.4
(3.1)%
(3.2)%
Sweaty Betty
$44.0
$44.0
—%
(0.7)%
International - Reported
$216.0
$267.7
(19.3)%
International - Ongoing
$216.0
$252.9
(14.6)%
Direct-to-Consumer - Reported
$113.4
$132.4
(14.4)%
Direct-to-Consumer - Ongoing
$113.2
$113.4
(0.2)%
Reported Financial Metrics
Gross Margin
43.1%
38.7%
440 bps
Operating Expenses
$154.1
$181.7
(15.2)%
Operating Margin
6.8%
7.8%
(100) bps
Diluted Earnings Per Share
$0.17
$0.30
(43.3)%
Non-GAAP and Ongoing Business Financial
Metrics
Adjusted Gross Margin
43.1%
39.1%
400 bps
Adjusted Operating Expenses
$156.1
$170.0
(8.2)%
Adjusted Operating Margin
6.3%
6.4%
(10) bps
Adjusted Diluted Earnings Per Share
$0.15
$0.19
(21.1)%
Constant Currency Earnings Per Share
$0.16
$0.19
(15.8)%
Gross margin improved significantly due to lower supply
chain costs, lower sales of end-of-life inventory, less promotional
eCommerce sales and favorable distribution channel mix.
Inventory at the end of the quarter was $297.1 million
and was down $350.8 million or approximately 54.1% compared to the
prior year and down $76.5 million from the prior year end.
Net Debt at the end of the quarter was $666 million, down
$271 million compared to the prior year and down $75 million from
the prior year end.
FULL-YEAR 2024 OUTLOOK
“We are pleased with how we are performing at this stage in our
strategic transformation, and our second quarter results reflect
the progress and the actions we've taken to improve the financial
position of the Company," said Taryn Miller, Chief Financial
Officer. “While there is more work to do as we advance Wolverine
Worldwide's strategy, we believe the steps we are taking will
position the business for long-term growth and value creation for
shareholders."
For Fiscal year 2024, the Company currently expects:
- Revenue from its ongoing business to be approximately
$1.71 to $1.73 billion. This range compares to the previous outlook
of approximately $1.68 to $1.73 billion and represents a decline of
approximately 14.2% to 13.2% and a constant currency decline of
approximately 14.1% to 13.1% compared to 2023.
- Gross margin of approximately 44.5%, up 460 basis points
compared to 2023, which remains unchanged from the previous
outlook.
- Operating margin to be approximately 6.0 % and adjusted
operating margin to be approximately 7.4%, up 350 basis points
compared to 2023. This compares to the previous operating margin
outlook of approximately 5.7% and adjusted operating margin of
approximately 7.0%.
- The effective tax rate to be approximately 18.5%, as
compared to the previous outlook of 18.0%
- Diluted earnings per share in the range of $0.53 to
$0.63 and adjusted diluted earnings per share in the range of $0.75
to $0.85. This compares to the previous outlook for diluted
earnings per share in the range of $0.43 to $0.63 and adjusted
diluted EPS between $0.65 and $0.85. These full-year EPS
expectations continue to include an approximate $0.10 negative
impact from foreign currency exchange rate fluctuations.
- Diluted weighted average shares of approximately 80
million, unchanged from previous guidance.
- Inventory to decline by at least $75 million at year end
compared to the prior year end, unchanged from previous
guidance.
- Net Debt at year end to be approximately $565 million, a
reduction of $175 million from the prior year end, unchanged from
previous guidance.
NON-GAAP FINANCIAL MEASURES
Measures referred to in this release as “adjusted” financial
results and the financial results of the "ongoing business" are
non-GAAP measures. Adjusted financial results exclude environmental
and other related costs net of recoveries, non-cash impairment of
long-lived assets and reorganization costs. The financial results
of the ongoing business exclude financial results from the Keds
business, Sperry business and Wolverine Leathers business prior to
the respective dates of sale of such businesses. Revenue adjusted
for divestitures and business model changes exclude financial
results from the Keds business, Sperry business and Wolverine
Leathers business prior to the respective dates of sale of such
businesses and are adjusted to include the impact of business model
changes in 2023 (the transition of Hush Puppies North America to a
licensing model, Hush Puppies IP sale, and conversion of the China
joint ventures to the distributor model) and business model changes
in 2024 (the transition of Merrell and Saucony Kids to a licensing
model). The Company also presents constant currency information,
which is a non-GAAP measure that excludes the impact of
fluctuations in foreign currency exchange rates. The Company
calculates constant currency basis by converting the current-period
local currency financial results using the prior period exchange
rates and comparing these adjusted amounts to the Company's current
period reported results. The Company believes providing each of
these non- GAAP measures provides valuable supplemental information
regarding its results of operations, consistent with how the
Company evaluates performance.
The Company has provided a reconciliation of each of the above
non-GAAP financial measures to the most directly comparable GAAP
financial measure. The Company believes these non-GAAP measures
provide useful information to both management and investors because
they increase the comparability of current period results to prior
period results by adjusting for certain items that may not be
indicative of core operating results and enable better
identification of trends in our business. The adjusted financial
results are used by management to, and allow investors to, evaluate
the operating performance of the Company on a comparable basis.
Management does not, nor should investors, consider such non-GAAP
financial measures in isolation from, or as a substitute for,
financial information prepared in accordance with GAAP.
EARNINGS CALL INFORMATION
The Company will host a conference call today at 8:30 a.m. ET to
discuss these results and current business trends. The conference
call will be broadcast live and accessible under the “Investor
Relations” tab at www.wolverineworldwide.com. A replay of the
conference call will be available on the Company’s website for a
period of approximately 30 days.
ABOUT WOLVERINE WORLDWIDE
Founded in 1883, Wolverine World Wide, Inc. (NYSE:WWW) is one of
the world’s leading marketers and licensors of branded casual,
active lifestyle, work, outdoor sport, athletic, children's and
uniform footwear and apparel. The Company's diverse portfolio of
highly recognized brands includes Merrell®, Saucony®, Sweaty
Betty®, Hush Puppies®, Wolverine®, Chaco®, Bates®, HYTEST®, and
Stride Rite®. Wolverine Worldwide is also the global footwear
licensee of the popular brands Cat® and Harley-Davidson®. Based in
Rockford, Michigan, for more than 140 years, the Company's products
are carried by leading retailers in the U.S. and globally in
approximately 170 countries and territories. For additional
information, please visit our website,
www.wolverineworldwide.com.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements,
including statements regarding the Company’s turnaround and
transformation; the Company's outlook for 2024 including, among
others: reported, adjusted and constant currency revenue; reported
and adjusted gross margin; reported and adjusted operating margin;
reported and adjusted net earnings; effective tax rate; reported
and adjusted diluted earnings per share; diluted weighted average
shares; and net debt; as well as statements regarding the Company's
progress executing its strategy to position the Company for
sustained growth in the future, better performance and greater
returns for shareholders, and the Company’s ability to achieve its
financial objectives. In addition, words such as “estimates,”
“anticipates,” “believes,” “forecasts,” “step,” “plans,”
“predicts,” “focused,” “projects,” “outlook,” “is likely,”
“expects,” “intends,” “should,” “will,” “confident,” variations of
such words, and similar expressions are intended to identify
forward-looking statements. These statements are not guarantees of
future performance and involve certain risks, uncertainties, and
assumptions (“Risk Factors”) that are difficult to predict with
regard to timing, extent, likelihood, and degree of occurrence.
Risk Factors include, among others: changes in general economic
conditions, employment rates, business conditions, interest rates,
tax policies, inflationary pressures and other factors affecting
consumer spending in the markets and regions in which the Company’s
products are sold; the inability for any reason to effectively
compete in global footwear, apparel and consumer-direct markets;
the inability to maintain positive brand images and anticipate,
understand and respond to changing footwear and apparel trends and
consumer preferences; the inability to effectively manage inventory
levels; changes in duties, tariffs, quotas or applicable
assessments in countries of import and export; foreign currency
exchange rate fluctuations; currency restrictions; supply chain or
other capacity constraints, production disruptions, including
reduction in operating hours, labor shortages, and facility
closures resulting in production delays at the Company’s
manufacturers, quality issues, price increases or other risks
associated with foreign sourcing; the cost, including the effect of
inflationary pressures, and availability of raw materials,
inventories, services and labor for contract manufacturers; labor
disruptions; changes in relationships with, including the loss of,
significant wholesale customers; risks related to the significant
investment in, and performance of, the Company’s consumer-direct
operations; risks related to expansion into new markets and
complementary product categories; the impact of seasonality and
unpredictable weather conditions; the impact of changes in general
economic conditions and/or the credit markets on the Company’s
manufacturers, distributors, suppliers, joint venture partners and
wholesale customers; changes in the Company’s effective tax rates;
failure of licensees or distributors to meet planned annual sales
goals or to make timely payments to the Company; the risks of doing
business in developing countries, and politically or economically
volatile areas; the ability to secure and protect owned
intellectual property or use licensed intellectual property; the
impact of regulation, regulatory and legal proceedings and legal
compliance risks, including compliance with federal, state and
local laws and regulations relating to the protection of the
environment, environmental remediation and other related costs, and
litigation or other legal proceedings relating to the protection of
the environment or environmental effects on human health; risks of
breach of the Company’s databases or other systems, or those of its
vendors, which contain certain personal information, payment card
data or proprietary information, due to cyberattack or other
similar events; problems affecting the Company’s supply chain and
distribution system, including service disruptions at shipping and
receiving ports; strategic actions, including new initiatives and
ventures, acquisitions and dispositions, and the Company’s success
in integrating acquired businesses, and implementing new
initiatives and ventures; risks relating to stockholder activism;
the potential effects of outbreaks of COVID-19 or future health
crises on the Company’s business, operations, financial results and
liquidity; the risk of impairment to goodwill and other
intangibles; the success of the Company’s restructuring and
realignment initiatives undertaken from time to time; changes in
future pension funding requirements and pension expenses; and
additional factors discussed in the Company’s reports filed with
the Securities and Exchange Commission and exhibits thereto. The
foregoing Risk Factors, as well as other existing Risk Factors and
new Risk Factors that emerge from time to time, may cause actual
results to differ materially from those contained in any
forward-looking statements. Given these or other risks and
uncertainties, investors should not place undue reliance on
forward-looking statements as a prediction of actual results.
Furthermore, the Company undertakes no obligation to update, amend,
or clarify forward-looking statements.
WOLVERINE WORLD WIDE, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited) (In millions, except earnings per
share)
Quarter Ended
Year-To-Date Ended
June 29, 2024
July 1, 2023
June 29, 2024
July 1, 2023
Revenue
$
425.2
$
589.1
$
820.1
$
1,188.5
Cost of goods sold
242.0
361.3
455.5
724.4
Gross profit
183.2
227.8
364.6
464.1
Gross margin
43.1
%
38.7
%
44.5
%
39.0
%
Selling, general and administrative
expenses
166.6
195.5
343.4
407.5
Gain on sale of business, trademarks and
long-lived assets
—
—
—
(20.1
)
Impairment of long-lived assets
3.2
15.6
9.3
15.6
Environmental and other related costs
(income), net of recoveries
(15.7
)
(29.4
)
(14.1
)
(30.3
)
Operating expenses
154.1
181.7
338.6
372.7
Operating expenses as a % of revenue
36.2
%
30.8
%
41.3
%
31.4
%
Operating profit
29.1
46.1
26.0
91.4
Operating margin
6.8
%
7.8
%
3.2
%
7.7
%
Interest expense, net
11.9
16.1
23.9
31.9
Other expense (income), net
(0.8
)
(0.4
)
(1.6
)
0.8
Total other expenses
11.1
15.7
22.3
32.7
Earnings before income taxes
18.0
30.4
3.7
58.7
Income tax expense
2.4
6.0
1.8
16.3
Effective tax rate
13.1
%
19.8
%
47.8
%
27.8
%
Net earnings
15.6
24.4
1.9
42.4
Less: net earnings (loss) attributable to
noncontrolling interests
1.4
0.4
2.2
(0.6
)
Net earnings (loss) attributable to
Wolverine World Wide, Inc.
$
14.2
$
24.0
$
(0.3
)
$
43.0
Diluted earnings (loss) per share
$
0.17
$
0.30
$
(0.01
)
$
0.53
Supplemental information:
Net earnings used to calculate diluted
earnings (loss) per share
$
13.7
$
23.5
$
(0.9
)
$
42.0
Shares used to calculate diluted earnings
(loss) per share
80.0
79.5
79.9
79.3
WOLVERINE WORLD WIDE, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited)
(In millions)
June 29, 2024
July 1, 2023
ASSETS
Cash and cash equivalents
$
148.3
$
176.5
Accounts receivables, net
272.2
241.5
Inventories, net
297.1
647.9
Current assets held for sale
—
19.1
Other current assets
73.2
78.9
Total current assets
790.8
1,163.9
Property, plant and equipment, net
90.2
134.3
Lease right-of-use assets
103.6
155.4
Goodwill and other indefinite-lived
intangibles
599.2
748.9
Other noncurrent assets
212.5
154.8
Total assets
$
1,796.3
$
2,357.3
LIABILITIES AND STOCKHOLDERS'
EQUITY
Accounts payable and other accrued
liabilities
$
398.0
$
530.0
Lease liabilities
32.6
39.2
Current maturities of long-term debt
10.0
10.0
Borrowings under revolving credit
agreements
225.0
385.0
Total current liabilities
665.6
964.2
Long-term debt
579.7
718.5
Lease liabilities, noncurrent
119.8
146.7
Other noncurrent liabilities
160.8
161.0
Stockholders' equity
270.4
366.9
Total liabilities and stockholders'
equity
$
1,796.3
$
2,357.3
WOLVERINE WORLD WIDE, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited) (In millions)
Year-To-Date Ended
June 29, 2024
July 1, 2023
OPERATING ACTIVITIES:
Net earnings
$
1.9
$
42.4
Adjustments to reconcile net earnings to
net cash provided by (used in) operating activities:
Depreciation and amortization
13.3
17.1
Deferred income taxes
(0.7
)
(0.6
)
Stock-based compensation expense
9.8
7.8
Pension and SERP expense
(0.3
)
0.8
Impairment of long-lived assets
9.3
15.6
Environmental and other related costs, net
of cash payments
(31.7
)
(41.0
)
Gain on sale of business, trademarks and
long-lived assets
—
(20.1
)
Other
(8.2
)
(0.9
)
Changes in operating assets and
liabilities
(3.9
)
24.8
Net cash provided by (used in) operating
activities
(10.5
)
45.9
INVESTING ACTIVITIES:
Additions to property, plant and
equipment
(8.1
)
(14.2
)
Proceeds from sale of business, trademarks
and long-lived assets, net of cash disposed of
92.5
81.9
Proceeds from company-owned insurance
policy liquidations
7.9
—
Other
(2.4
)
(0.7
)
Net cash provided by investing
activities
89.9
67.0
FINANCING ACTIVITIES:
Payments under revolving credit
agreements
(299.0
)
(475.0
)
Borrowings under revolving credit
agreements
219.0
435.0
Proceeds from company-owned insurance
policies
7.0
—
Payments on long-term debt
(26.7
)
(5.0
)
Payments of debt issuance costs
—
(0.9
)
Cash dividends paid
(16.2
)
(16.4
)
Employee taxes paid under stock-based
compensation plans
(1.7
)
(5.7
)
Proceeds from the exercise of stock
options
—
0.1
Contributions from noncontrolling
interests
—
2.1
Net cash used in financing activities
(117.6
)
(65.8
)
Effect of foreign exchange rate
changes
1.9
(2.5
)
Increase (decrease) in cash and cash
equivalents
(36.3
)
44.6
Cash and cash equivalents at beginning of
the year
184.6
135.5
Cash and cash equivalents at end of the
quarter
$
148.3
$
180.1
The following tables contain information regarding the non-GAAP
financial measures used by the Company in the presentation of its
financial results:
WOLVERINE WORLD WIDE, INC.
Q2 2024 RECONCILIATION TABLES
RECONCILIATION OF REPORTED REVENUE TO
ADJUSTED REVENUE ON A CONSTANT CURRENCY BASIS*
(Unaudited) (In millions)
GAAP Basis 2024-Q2
Foreign Exchange
Impact
Constant Currency Basis
2024-Q2
GAAP Basis 2023-Q2
Reported Change
Constant Currency
Change
REVENUE
Active Group
$
305.9
$
0.8
$
306.7
$
383.3
(20.2
)%
(20.0
)%
Work Group
105.0
(0.1
)
104.9
117.8
(10.9
)%
(11.0
)%
Other
14.3
—
14.3
88.0
(83.8
)%
(83.8
)%
Total
$
425.2
$
0.7
$
425.9
$
589.1
(27.8
)%
(27.7
)%
RECONCILIATION OF REPORTED REVENUE TO
ADJUSTED REVENUE* (Unaudited) (In millions)
GAAP Basis
Divestiture (1)
As Adjusted
Revenue - Fiscal 2024 Q2
$
425.2
$
0.4
$
424.8
Revenue - Fiscal 2023 Q2
$
589.1
$
68.3
$
520.8
(1)
Q2 2024 adjustments reflect the Sperry
business results included in the consolidated condensed statement
of operations. Q2 2023 adjustments reflect results for the Sperry
business and Wolverine Leathers business included in the
consolidated condensed statement of operations.
RECONCILIATION OF REPORTED GROSS MARGIN
TO ADJUSTED GROSS MARGIN * (Unaudited) (In
millions)
GAAP Basis
Divestiture (1)
As Adjusted
Gross Profit - Fiscal 2024 Q2
$
183.2
$
(0.3
)
$
182.9
Gross margin
43.1
%
43.1
%
Gross Profit - Fiscal 2023 Q2
$
227.8
$
(24.4
)
$
203.4
Gross margin
38.7
%
39.1
%
(1)
Q2 2024 adjustments reflect the Sperry
business results included in the consolidated condensed statement
of operations. Q2 2023 adjustments reflect results for the Sperry
business and Wolverine Leathers business included in the
consolidated condensed statement of operations.
RECONCILIATION OF REPORTED OPERATING
EXPENSES TO ADJUSTED OPERATING EXPENSES*
(Unaudited) (In millions)
GAAP Basis
Adjustment (1)
Divestiture (2)
As Adjusted
Operating expenses - Fiscal 2024 Q2
$
154.1
$
3.5
$
(1.5
)
$
156.1
Operating expenses - Fiscal 2023 Q2
$
181.7
$
11.7
$
(23.4
)
$
170.0
(1)
Q2 2024 adjustments reflect $15.7 million
of environmental and other related costs net of recoveries,
partially offset by $9.0 million of reorganization costs and $3.2
million for impairments of long-lived assets. Q2 2023 adjustments
reflect $29.4 million of environmental and other related costs net
of recoveries, partially offset by $15.6 million for impairments of
long-lived assets and $2.1 million of reorganization costs.
(2)
Q2 2024 adjustments reflect the Sperry
business results included in the consolidated condensed statement
of operations. Q2 2023 adjustments reflect results for the Sperry
business and Wolverine Leathers business included in the
consolidated condensed statement of operations.
RECONCILIATION OF REPORTED OPERATING
MARGIN TO ADJUSTED OPERATING MARGIN* (Unaudited)
(In millions)
GAAP Basis
Adjustments (1)
Divestiture (2)
As Adjusted
Operating Profit - Fiscal 2024 Q2
$
29.1
$
(3.5
)
$
1.2
$
26.8
Operating margin
6.8
%
6.3
%
Operating Profit - Fiscal 2023 Q2
$
46.1
$
(11.7
)
$
(0.9
)
$
33.5
Operating margin
7.8
%
6.4
%
(1)
Q2 2024 adjustments reflect $15.7 million
of environmental and other related costs net of recoveries,
partially offset by $9.0 million of reorganization costs and $3.2
million for impairments of long-lived assets. Q2 2023 adjustments
reflect $29.4 million of environmental and other related costs net
of recoveries, partially offset by $15.6 million for impairments of
long-lived assets and $2.1 million of reorganization costs.
(2)
Q2 2024 adjustments reflect the Sperry
business results included in the consolidated condensed statement
of operations. Q2 2023 adjustments reflect results for the Sperry
business and Wolverine Leathers business included in the
consolidated condensed statement of operations.
RECONCILIATION OF REPORTED DILUTED EPS TO
ADJUSTED DILUTED EPS ON A CONSTANT CURRENCY BASIS*
(Unaudited)
GAAP Basis
Adjustments (1)
Divestiture (2)
As Adjusted
Foreign Exchange
Impact
As Adjusted EPS On a
Constant Currency Basis
EPS - Fiscal 2024 Q2
$
0.17
$
(0.03
)
$
0.01
$
0.15
$
0.01
$
0.16
EPS - Fiscal 2023 Q2
$
0.30
$
(0.10
)
$
(0.01
)
$
0.19
(1)
Q2 2024 adjustments reflect environmental
and other related costs net of recoveries, partially offset by
impairments of long-lived assets and reorganization costs. Q2 2023
adjustments reflect environmental and other related costs net of
recoveries, partially offset by impairments of long-lived assets
and reorganization costs.
(2)
Q2 2024 adjustments reflect the Sperry
business results included in the consolidated condensed statement
of operations. Q2 2023 adjustments reflect results for the Sperry
business and Wolverine Leathers business included in the
consolidated condensed statement of operations.
RECONCILIATION OF REPORTED INVENTORY
TO ADJUSTED INVENTORY* (Unaudited) (In
millions)
GAAP Basis
Divestiture (1)
As Adjusted
Inventory - 2024 Q2
$
297.1
$
—
$
297.1
Inventory - 2024 Q1
$
354.3
$
—
$
354.3
Inventory - 2023 Q4
$
373.6
$
—
$
373.6
Inventory - 2023 Q3
$
563.8
$
100.6
$
463.2
Inventory - 2023 Q2
$
647.9
$
113.3
$
534.6
Inventory - 2023 Q1
$
725.9
$
120.5
$
605.4
(1)
Adjustments reflect the Sperry business
and consolidated China joint ventures inventory included in the
consolidated condensed balance sheet.
DIVESTITURE FINANCIAL SUMMARY
(Unaudited) (In millions, except per share
amounts)
In order to provide visibility regarding the financial impact of
completed divestitures, the Company has provided additional
information within the supplemental table below. The items included
in the tables represent amounts that are reflected in the reported
fiscal 2024 and 2023 results that are related to businesses the
Company has sold. The Company believes providing the following
information is helpful to better understand the impact of the
divestitures on the Company's ongoing business.
Q1
Q2
Q3
Q4
2024 YTD
Revenue - Impact
Sperry business (1)
$
4.1
$
0.4
$
—
$
—
$
4.5
Total Revenue - Impact
$
4.1
$
0.4
$
—
$
—
$
4.5
Operating profit - Impact
Sperry business (1)
$
(8.2
)
$
(1.2
)
$
—
$
—
$
(9.4
)
Wolverine Leathers business (2)
(0.6
)
—
—
—
(0.6
)
Total Operating profit - Impact
$
(8.8
)
$
(1.2
)
$
—
$
—
$
(10.0
)
Net earnings per share - Impact
$
(0.10
)
$
(0.01
)
$
—
$
—
$
(0.11
)
Q1
Q2
Q3
Q4
2023 Full-Year
Revenue - Impact
Sperry business (1)
$
62.9
$
57.4
$
46.2
$
40.7
$
207.2
Wolverine Leathers business (2)
12.5
10.9
8.2
5.5
37.1
Keds business (3)
6.5
—
—
—
6.5
Total Revenue - Impact
$
81.9
$
68.3
$
54.4
$
46.2
$
250.8
Operating profit - Impact
Sperry business (1)
$
(2.3
)
$
0.2
$
(4.0
)
$
(4.2
)
$
(10.3
)
Wolverine Leathers business (2)
1.4
0.8
1.1
—
3.3
Keds business (3)
(1.9
)
—
—
—
(1.9
)
Total Operating profit - Impact
$
(2.8
)
$
1.0
$
(2.9
)
$
(4.2
)
$
(8.9
)
Net earnings per share - Impact
$
(0.03
)
$
0.01
$
(0.03
)
$
(0.04
)
$
(0.09
)
(1)
The Sperry® business reflects the revenue
and operating profit from sale of Sperry® products through the sale
of the Sperry® business effective January 10, 2024. The amounts
also include revenue and operating profit associated with Sperry®
stores not included in the divestiture which the Company has closed
or is in the process of closing, costs associated with Sperry®
employees not included in the divestiture transaction and costs
incurred winding down the Sperry® business, including the Sperry®
business with joint venture partners, that are not covered by the
transition service agreement. The Sperry® business revenue and
operating profit will not reoccur after the Company closes all of
the Sperry® stores that were not divested and completes the
transition of the Sperry® business and employees.
(2)
The Wolverine Leathers business line item
reflects revenue and operating profit from the Wolverine Leathers
business that will not reoccur after the Wolverine Leathers
business is sold. The Company divested the U.S. Wolverine Leathers
business in August 2023 and divested the non-U.S. Wolverine
Leathers business in December 2023. The Wolverine Leathers costs
incurred in 2024 are associated with employees not included in the
divestiture transaction.
(3)
The Keds® business line item reflects the
revenue and operating profit from sale of Keds® products that will
not reoccur after the Company's first period in fiscal 2023 as a
result of the sale of the global Keds® business effective February
4, 2023.
RECONCILIATION OF 2023 REPORTED REVENUE
TO ADJUSTED REVENUE FOR COMPARISON TO 2024 GUIDANCE*
(Unaudited) (In millions)
GAAP Basis
Keds and Leathers Divestiture
(1)
Sperry Divestiture (2)
As Adjusted
Revenue - Fiscal 2023
$
2,242.9
$
43.6
$
207.2
$
1,992.1
(1)
Adjustments reflect the Keds business and
Wolverine Leathers business results included in the consolidated
condensed statement of operations.
(2)
Adjustments reflect the Sperry business
results included in the consolidated condensed statement of
operations.
RECONCILIATION OF REPORTED 2023 OPERATING
MARGIN TO ADJUSTED OPERATING MARGIN FOR COMPARISON TO
2024 GUIDANCE* (Unaudited) (In millions)
GAAP Basis
Adjustments (1)
Keds and Leathers Divestiture
(2)
Sperry Divestiture (3)
As Adjusted
Operating Profit (Loss) - Fiscal 2023
$
(68.2
)
$
137.1
$
(1.4
)
$
10.3
$
77.8
Operating margin
(3.0
)%
3.9
%
(1)
Adjustments reflect $185.3 million for a
non-cash impairment of long-lived assets, $47.1 million of
reorganization costs, and $5.5 million of costs associated with
divestitures, partially offset by $90.4 million gain on the sale of
businesses, trademarks and long-lived assets and $10.4 million of
environmental and other related costs net of recoveries.
(2)
Adjustments reflect the Keds business and
Wolverine Leathers business results included in the consolidated
condensed statement of operations.
(3)
Adjustments reflect the Sperry business
results included in the consolidated condensed statement of
operations.
RECONCILIATION OF REPORTED 2023 DILUTED EPS
TO ADJUSTED DILUTED EPS FOR COMPARISON TO 2024
GUIDANCE* (Unaudited)
GAAP Basis
Adjustments (1)
Keds and Leathers Divestiture
(2)
Sperry Divestiture (3)
As Adjusted
EPS - Fiscal 2023
$
(0.51
)
$
0.57
$
(0.01
)
$
0.10
$
0.15
(1)
Adjustments reflect non-cash impairment of
long-lived assets, reorganization costs, costs associated with
divestitures, debt modification costs, partially offset by gain on
the sale of businesses, trademarks and long-lived assets,
environmental and other related costs net of recoveries, and SERP
curtailment gain.
(2)
Adjustments reflect the Keds business and
Wolverine Leathers business results included in the consolidated
condensed statement of operations.
(3)
Adjustments reflect the Sperry business
results included in the consolidated condensed statement of
operations.
2024 GUIDANCE RECONCILIATION TABLES
RECONCILIATION OF REPORTED GUIDANCE TO ADJUSTED GUIDANCE,
REPORTED DILUTED EPS GUIDANCE TO ADJUSTED DILUTED EPS
GUIDANCE AND SUPPLEMENTAL INFORMATION* (Unaudited)
(In millions, except earnings per share)
GAAP Basis
Divestiture Adjustments
(1)
Other Adjustments
(2)
As Adjusted
Revenue - Fiscal 2024 Full Year
$1,714 - $1,734
$(4)
$1,710 - $1,730
Gross Margin - Fiscal 2024 Full Year
44.4 %
0.1 %
44.5 %
Operating Margin - Fiscal 2024 Full
Year
6.0 %
0.7 %
0.7 %
7.4 %
Dilutive EPS - Fiscal 2024 Full Year
$0.53 -$0.63
$0.10
$0.12
$0.75 - $0.85
Fiscal 2024 Full Year Supplemental
information:
Net Earnings
$44 -$52
$8
$10
$62 - $70
Net Earnings used to calculate diluted
earnings per share
$42 - $50
$8
$10
$60 - $68
Shares used to calculate diluted earnings
per share
79.9
79.9
(1)
2024 adjustments reflect financial results
for the Sperry® business and Sperry® stores that were not divested
which the Company is closing in 2024.
(2)
2024 adjustments reflect estimated
environmental and other related costs net of recoveries, impairment
of long-lived assets and reorganization costs.
* To supplement the
consolidated condensed financial statements presented in accordance
with Generally Accepted Accounting Principles ("GAAP"), the Company
describes what certain financial measures would have been if
environmental and other related costs net of recoveries, non-cash
impairment of long-lived assets and reorganization costs. The
financial results of the ongoing business for 2023 and the second
quarter of 2024 exclude financial results from the Sperry business,
the Keds business and Wolverine Leathers business. Adjusted
inventory excludes the Sperry business and the Company’s China
joint ventures. The adjusted 2024 outlook excludes financial
results from the Sperry business and Sperry® stores that were not
divested, which the Company is closing in 2024. The Company
believes these non-GAAP measures provide useful information to both
management and investors by increasing comparability to the prior
period by adjusting for certain items that may not be indicative of
the Company's core ongoing operating business results and to better
identify trends in the Company's ongoing business. The adjusted
financial results are used by management to, and allow investors
to, evaluate the operating performance of the Company on a
comparable basis. The constant currency presentation, which
is a non-GAAP measure, excludes the impact of fluctuations in
foreign currency exchange rates. The Company believes providing
constant currency information provides valuable supplemental
information regarding results of operations, consistent with how
the Company evaluates performance. The Company calculates constant
currency by converting the current-period local currency financial
results using the prior period exchange rates and comparing these
adjusted amounts to the Company's current period reported results.
Management does not, nor should investors, consider such
non-GAAP financial measures in isolation from, or as a substitution
for, financial information prepared in accordance with GAAP. A
reconciliation of all non-GAAP measures included in this press
release, to the most directly comparable GAAP measures are found in
the financial tables above.
For purposes of providing additional information regarding
year-over-year revenue comparisons, the below table adjusts 2023
revenue for divestitures and business model changes.
DIVESTITURE AND BUSINESS MODEL CHANGES
RECONCILIATION OF 2023 REPORTED REVENUE TO ADJUSTED
REVENUE* (Unaudited) (In millions)
Q1
Q2
Q3
Q4
FY
Revenue - Fiscal 2023
$
599.4
$
589.1
$
527.7
$
526.7
$
2,242.9
Adjustment for divestitures (1)
Leathers
(12.5
)
(10.9
)
(8.2
)
(5.5
)
(37.1
)
Keds
(6.5
)
—
—
—
(6.5
)
Sperry
(62.9
)
(57.4
)
(46.2
)
(40.7
)
(207.2
)
Ongoing business (2)
$
517.5
$
520.8
$
473.3
$
480.5
$
1,992.1
Adjustments for 2023 business model
changes (3)
(13.0
)
(13.5
)
(16.9
)
(13.9
)
(57.3
)
Adjustments for 2024 business model
changes (4)
—
(6.7
)
(7.5
)
(3.3
)
(17.5
)
Ongoing business adjusted for business
model changes
$
504.5
$
500.6
$
448.9
$
463.3
$
1,917.3
(1)
Divestitures: Keds sold in February 2023,
Leathers US sold August 2023, Leathers non-US sold December 2023,
Sperry sold in January 2024.
(2)
Ongoing business excludes the impact of
the Wolverine Leathers, Keds and Sperry businesses.
(3)
Business model changes occurring in 2023
provided for enhanced comparability, include the impact of Hush
Puppies North America transition to licensing model, Hush Puppies
IP sale, and China joint venture converted to distributor
model.
(4)
Business model changes occurring in 2024
provided for enhanced comparability, include the impact of Merrell
and Saucony Kids transition to licensing model.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240807970483/en/
Alex Wiseman (616) 863-3974
Wolverine World Wide (NYSE:WWW)
過去 株価チャート
から 8 2024 まで 9 2024
Wolverine World Wide (NYSE:WWW)
過去 株価チャート
から 9 2023 まで 9 2024