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Crocs presents strong Q2 results, revenues jump 51 percent

By Prachi Singh

Aug 4, 2022

Management

Image: courtesy of Crocs

For its second quarter, Crocs, Inc. reported consolidated revenues of 964.6 million dollars increased 50.5 percent or 55.6 percent on a constant currency basis, as compared to 2021.

Crocs brand quarterly revenues of 732.2 million dollars, increased 14.3 percent or 19.4 percent on a constant currency basis, as compared to 2021. Heydude brand revenues were 232.4 million dollars, up approximately 96 percent compared to 2021.

Commenting on the second quarter trading, Andrew Rees, the company’s chief executive officer said: "I am particularly excited by record revenues for the Crocs brand and the strong growth internationally. Heydude continues to outperform our expectations and we now expect nearly 1 billion in pro forma revenues this year."

Review of Crocs results in the second quarter

The company’s direct-to-consumer (DTC), which includes retail and e-commerce, grew 22.8 percent and wholesale grew 80.6 percent.

Gross margin for the quarter was 51.6 percent compared to 61.7 percent and adjusted gross margin was 55.2 percent compared to 61.8 percent in the same period last year.

The company said, operating margin was 25.7 percent and adjusted operating margin was 30.1 percent.

Diluted earnings per share decreased to 2.58 dollars, while adjusted diluted earnings per share increased 45.3 percent to 3.24 dollars compared to 2.23 dollars in 2021.

Crocs brand reports strong growth in Q2

Crocs brand digital sales grew 16.8 percent or 20.8 percent on a constant currency basis, to represent 37.2 percent of Crocs brand revenues versus 36.4 percent in prior year.

Crocs brand wholesale revenues increased 27.7 percent or 35.2 percent on a constant currency basis and DTC comparable sales increased 7.5 percent.

The brand’s North America revenues of 422.9 million dollars increased 7.6 percent or 7.8 percent on a constant currency basis, Asia Pacific revenues of 148.9 million dollars increased 17.4 percent or 27.6 percent on a constant currency basis and Europe, Middle East, Africa, and Latin America (EMEALA) revenues of 160.4 million dollars increased 32.8 percent or 48.4 percent on a constant currency basis.

Heydude brand digital penetration was 31.5 percent of the total brand revenues. Brand’s wholesale revenues were 162.5 million dollars and DTC revenues were 69.9 million dollars.

Crocs expects FY22 turnover growth between 47 and 52 percent

With respect to 2022, the company expects consolidated revenues to be approximately 3.395 to 3.505 billion dollars, representing growth between 47 percent and 52 percent compared to 2021.

Crocs brand revenues to be 2.545 to 2.615 billion dollars, implying 14 percent to 17 percent growth on a constant currency basis and 10 percent to 13 percent growth on a reported basis.

Revenues for the Heydude brand to be approximately 850 to 890 million dollars on a reported basis, implying 940 to 980 million dollars, including the period of time prior to the closing of the acquisition.

Gross margin to still include 75 million dollars of air freight in 2022, adjusted operating income of approximately 880 to 945 million dollars and adjusted operating margin to still be approximately 26 percent to 27 percent.

Adjusted diluted earnings per share to now be between 9.50 dollars and 10.30 dollars.

With respect to the third quarter of 2022, Crocs expects consolidated revenues to be approximately 915 to 955 million dollars, implying approximately 46 percent to 53 percent growth.

Crocs brand revenues to be 680 to 700 million dollars, implying approximately 15 percent to 18 percent growth on a constant currency basis and 9 percent to 12 percent growth on a reported basis. Heydude brand revenues of approximately 235 to 255 million dollars.

Adjusted operating margin of approximately 25 percent to 26 percent.

CROCS
HEYDUDE