Crocs Inc. (CROX, Financial), a world leader in innovative casual footwear for men, women and children, offers several distinct shoe collections with more than 300 four-season footwear styles. Headquartered in Niwot, Colorado, Crocs has more than 4,000 employees globally.
Crocs offers a broad portfolio of all-season products while remaining true to its core molded footwear heritage. All Crocs shoes feature Croslite material, a proprietary, revolutionary technology that gives each pair of shoes the soft, comfortable, lightweight, nonmarking and odor-resistant qualities that Crocs fans know and love.
Crocs celebrates the fun of being a little different and encourages fans to "Find Your Fun" in every colorful pair of shoes. Since its inception in 2002, Crocs has sold more than 200 million pairs of shoes in more than 90 countries around the world.
The company reported a strong third quarter and is poised to grow. The company delivered third-quarter sales in line with its revised expectations reflecting challenges in China and currency. It is positioned for improved results in 2016.
Asian countries hold tremendous opportunities for this company. It is already closing down underperforming stores. It is expanding the products it offers and diversifying into sneakers, loafers and boots. With robust innovation, continuing research and development activities, Crocs is bound to create shareholder returns.
Crocs is headed for a turnaround. The company is expected to come back in the near future. The footwear industry is booming right now, and this company has more room to grow.
Third-quarter results
Revenue was $274.1 million. On a constant currency basis, revenue decreased 0.8% from the prior-year quarter.
Net loss attributable to common stockholders on a GAAP basis was $27.8 million or a loss of 37 cents per share (which was a net income of $12.0 million or 12 cents per diluted share in the prior year quarter).
Excluding certain nonrecurring and special charges, the company reported a non-GAAP adjusted net loss attributable to common shareholders of $19.2 million (which was net income of $29.4 million in the prior-year quarter).
Cash and cash equivalents at Sept. 30, 2015, were $168.5 million.
Inventory was $190.8 million during the third quarter (which was $171.0 million in the prior year quarter).
Share repurchases
The company repurchased 2.3 million shares of common stock in the third quarter of 2015 at an average price of $14.50. The company ended the quarter at 73.6 million common shares outstanding, and third quarter weighted average shares outstanding was 74.3 million.
Management
Carrie Teffner has been named executive vice president and chief financial officer of Crocs and joined the company on Dec. 16, 2015. Teffner, who was appointed to Crocs' board of directors in June 2015, brings more than 25 years of consumer goods and retail leadership experience to the company.
Focus
The company is focusing on the following:
- Strengthening the brand.
- Elevating product stories.
- Evolving international business.
- Strengthening relationships with key wholesale partners.
- Improving direct-to-consumer capabilities.
- Simplifying business model.
- Enhancing supply chain.
- Building a best in class management team.
- Cost curtailment.
Positive attributes
The company has the following positive attributes attached to it:
- Continual innovation.
- Investment in research and development.
- It is constantly evolving.
On a concluding note
Crocs' management is focusing on reducing capital expenditures, and this could lift the cash flows of the company significantly. By 2019, the global footwear market can be worth about $200 billion to $220 billion.
Asia is expected to contribute significantly to this growth. Crocs has huge potential in this part of the world. The good news is that Crocs has performed well in this region. Rising income of the middle class and awareness of looking and feeling good are contributing to this growth.
