February 20, 2008
Steven Madden Ltd, a leading designer, wholesaler and marketer of fashion footwear and accessories for women, men and children, announced financial results for the fourth quarter and fiscal year ended December 31, 2007.
Fourth quarter net sales were $102.7 million compared to $114.1 million reported in the comparable period of 2006, reflecting the weak economic environment as well as the absence of any major footwear trends. Gross margin declined to 37.9% from 40.8%, reflecting margin declines in both the wholesale and retail divisions.
Operating expenses as a percent of sales were 34.0% versus 29.6% in the same period of the prior year, due primarily to reduced leverage on lower sales versus the prior year period as well as expenses associated with new store openings.
Operating income for fourth quarter decreased to $7.0 million, or 6.8% of sales, compared with operating income of $16.7 million, or 14.6% of sales, in the same period of 2006. Net income decreased 53.2% to $4.7 million, or $0.23 per diluted share, compared to $10.0 million, or $0.45 per diluted share, in the prior year's fourth quarter.
Revenues from the wholesale business were $63.5 million compared to $76.6 million in the fourth quarter of 2006 due to a challenging selling environment with a lack of strong direction in footwear fashion trends as well as the weak macroeconomic environment.
Gross margin in the wholesale business declined to 26.8% from 31.5% in theprior year's fourth quarter, due primarily to higher markdown allowances relative to the year ago period.
Steven Madden Ltd