UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: May 4, 2010
(Date of earliest event reported)
STEVEN MADDEN, LTD.
(Exact Name of Registrant as Specified in Charter)
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Delaware
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000-23702
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13-3588231
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(State or Other Jurisdiction
of Incorporation)
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(Commission File Number)
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(IRS Employer
Identification No.)
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| 52-16 Barnett Avenue, Long Island City, New York 11104 | ||||
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(Address of Principal Executive Offices) (Zip Code)
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Registrant’s telephone number, including area code: (718) 446-1800
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 2.02.
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Results of Operations and Financial Condition.
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On May 4, 2010, Steven Madden, Ltd. (the “Company”) issued a press release, furnished as Exhibit 99.1 and incorporated in this Item 2.02 by reference, announcing the Company’s financial results for the quarter ended March 31, 2010.
The information contained in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished, and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of Section 18. Furthermore, the information contained in this Current Report on Form 8-K, including Exhibit 99.1, shall not be incorporated by reference into any registration statement filed by the Company under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference. The furnishing of the information in this Report is not intended to, and does not, constitute a determination or admission by the Company that the information in this Report is mat
erial or complete, or that investors should consider this information before making an investment decision with respect to any security of the Company.
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Item 9.01.
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Financial Statements and Exhibits.
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(d)
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Exhibits:
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Exhibit
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Description
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99.1
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Press Release, dated May 4, 2010, issued by Steven Madden, Ltd.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: May 4, 2010
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STEVEN MADDEN, LTD.
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By:
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/s/Edward R. Rosenfeld
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Edward R. Rosenfeld
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Chief Executive Officer
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Exhibit 99.1
Steve Madden Announces First Quarter 2010 Results
Raises Fiscal 2010 Guidance
LONG ISLAND CITY, N.Y., May 4, 2010 /PRNewswire-FirstCall/ — Steve Madden (Nasdaq: SHOO), a leading designer and marketer of fashion footwear and accessories for women, men and children, today announced financial results for the first quarter ended March 31, 2010.
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First quarter net sales increased 22.5% to $131.6 million.
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Retail comparable store sales increased 13.6% for the first quarter.
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Operating margin reached 18.9% of sales in the first quarter 2010, compared with operating margin of 9.6% in the same period of 2009.
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First quarter net income increased 134% to $15.4 million, or $0.55 per diluted share, compared to $6.6 million, or $0.24 per diluted share adjusted for stock split, in the prior year’s first quarter.
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Edward Rosenfeld, Chairman and Chief Executive Officer, commented, “We are extremely pleased with the continued momentum in our core business as well as with the initial success of our recent initiatives. Steve and the design team continue to capitalize on the latest trends with fresh, fashion-forward product, leading to strong demand for our existing brands. At the same time, our new business ventures – including Big Buddha, Elizabeth and James, Olsenboye and Madden – are off to a great start and are expected to contribute nicely to our sales and earnings growth in 2010 and beyond.”
First Quarter 2010 Results
First quarter net sales were $131.6 million compared to $107.4 million reported in the comparable period of 2009. Net sales from the wholesale business were $103.1 million compared to $81.3 million in the first quarter of 2009, driven by strong gains in the Company’s existing wholesale footwear divisions as well as contributions from our new license for the Elizabeth and James brand and our recent acquisitions, Madden Zone and Big Buddha. Retail net sales grew 9.1% to $28.5 million compared to $26.1 million in the first quarter of the prior year despite a smaller store base. Same store sales increased 13.6%.
Gross margin improved to 45.5% from 40.5%, reflecting margin improvement in both the wholesale and retail divisions. Gross margin in the wholesale business increased to 42.5% from 38.1% in the prior year’s first quarter due primarily to higher initial mark-ups and more full-price selling. Retail gross margin increased to 56.7% from 47.8% in the comparable period of the prior year as a result of less discounting and higher initial mark-ups.
Operating expenses as a percent of sales were 31.4% compared to 33.6% in the same period of the prior year, due to leverage on increased sales.
Operating income for the first quarter increased to $24.9 million, or 18.9% of net sales, compared with operating income of $10.3 million, or 9.6% of net sales, in the same period of 2009.
Net income increased 134% to $15.4 million, or $0.55 per diluted share, compared to $6.6 million, or $0.24 per diluted share adjusted for the 3-for-2 stock split, in the prior year’s first quarter.
During the first quarter of 2010, the Company closed five stores and opened one, ending the quarter with 85 retail locations, including the Internet store.
At the end of the first quarter, cash, cash equivalents and marketable securities totaled $157.4 million.
Arvind Dharia, Chief Financial Officer, commented, “We maintained a healthy balance sheet during the first quarter of 2010 supported by strong operating cash flow and prudent capital management.”
Company Outlook
For fiscal 2010, the Company now expects sales to increase 17% – 19%. Diluted EPS is now expected to be in the range of $2.30 – $2.40, compared to previous guidance of diluted EPS in the range of $2.07 – $2.20 on an adjusted basis to address our recently effected 3-for-2 stock split in the form of a stock dividend on the Company’s outstanding common stock.
Conference Call Information
As previously announced, interested stockholders are invited to listen to the first quarter earnings conference call scheduled for today, Tuesday, May 4, 2010, at 8:30 a.m. Eastern Time. The call will be broadcast live over the Internet and can be accessed by logging onto http://www.stevemadden.com. An online archive of the broadcast will be available within one hour of the conclusion of the call and will be accessible for a period of 30 days following the call. Additionally, a replay of the call can be accessed by dialing 888-203-1112, passcode 7481052, and will be available until June 4, 2010.
About Steve Madden
Steve Madden designs, sources, markets, and sells fashion-forward footwear and accessories for women, men and children under both owned and licensed brands.
Safe Harbor
This press release and oral statements made from time to time by representatives of the Company contain certain “forward looking statements” as that term is defined in the federal securities laws. The events described in forward looking statements may not occur. Generally these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of the Company’s plans or strategies, projected or anticipated benefits from acquisitions to be made by the Company, or projections involving anticipated revenues, earnings or other aspects of the Company’s operating results. The words “may,” “will,” “expect,” “believe,” “anticipate,” “project,” “plan,” “intend,” “estimate,” and &
#8220;continue,” and their opposites and similar expressions are intended to identify forward looking statements. The Company cautions you that these statements concern current expectations about the Company’s future results and condition and are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences, many of which are beyond the Company’s control, that may influence the accuracy of the statements and the projections upon which the statements are based. Factors which may affect the Company’s results include, but are not limited to, the risks and uncertainties discussed in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. Any one or more of these uncertainties, risks and other influences could materially affect the Company’s results of operations and condition and whether forward looking statements made by
the Company ultimately prove to be accurate and, as such, the Company’s actual results, performance and achievements could differ materially from those expressed or implied in these forward looking statements. The Company undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise.
STEVEN MADDEN, LTD.
CONSOLIDATED STATEMENT OF OPERATIONS DATA
(In thousands, except per share data)
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Quarter Ended
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Mar 31 2010
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Mar 31 2009
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(Unaudited)
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(Unaudited)
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Net sales
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$ | 131,608 | $ | 107,429 | |||
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Cost of sales
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71,671 | 63,942 | |||||
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Gross profit
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59,937 | 43,487 | |||||
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Commission and licensing fee income
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6,184 | 2,905 | |||||
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Operating expenses
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41,262 | 36,088 | |||||
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Income from operations
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24,859 | 10,304 | |||||
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Interest and other income, net
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784 | 396 | |||||
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Income before provision for income taxes
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25,643 | 10,700 | |||||
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Provision for income taxes
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10,258 | 4,123 | |||||
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Net income
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$ | 15,385 | $ | 6,577 | |||
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Post-split
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Basic income per share
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$ | 0.56 | $ | 0.25 | |||
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Diluted income per share
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$ | 0.55 | $ | 0.24 | |||
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Weighted average common shares outstanding - Basic
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27,455 | 26,834 | |||||
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Weighted average common shares outstanding - Diluted
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28,155 | 26,958 | |||||
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Pre-split
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Basic income per share
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$ | 0.84 | $ | 0.37 | |||
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Diluted income per share
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$ | 0.82 | $ | 0.37 | |||
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Weighted average common shares outstanding - Basic
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18,304 | 17,889 | |||||
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Weighted average common shares outstanding - Diluted
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18,770 | 17,972 | |||||
CONSOLIDATED BALANCE SHEET HIGHLIGHTS
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(In thousands)
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Mar 31 2010
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Dec 31, 2009
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Mar 31 2009
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(Unaudited)
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(Unaudited)
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Cash and cash equivalents
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$ | 69,221 | $ | 69,266 | $ | 63,235 | ||||||
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Marketable securities (current and non-current)
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88,172 | 85,684 | 29,395 | |||||||||
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Total current assets
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198,341 | 191,369 | 167,081 | |||||||||
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Total assets
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355,970 | 326,859 | 254,145 | |||||||||
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Total current liabilities
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51,186 | 52,362 | 34,061 | |||||||||
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Total liabilities
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69,901 | 59,072 | 40,045 | |||||||||
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Total stockholders’ equity
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286,069 | 267,787 | 214,100 | |||||||||