-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GVZK2prD3vwvaADdznPH1GuFiH6LCgnKRfCiLy5nMzjVvWdLecHN8vaR0Mu4tPda SZ6M4ePjUaFs8u0VzNIFKA== 0001157523-05-001831.txt : 20050224 0001157523-05-001831.hdr.sgml : 20050224 20050224074516 ACCESSION NUMBER: 0001157523-05-001831 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20050223 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050224 DATE AS OF CHANGE: 20050224 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DECKERS OUTDOOR CORP CENTRAL INDEX KEY: 0000910521 STANDARD INDUSTRIAL CLASSIFICATION: RUBBER & PLASTICS FOOTWEAR [3021] IRS NUMBER: 953015862 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-22446 FILM NUMBER: 05635760 BUSINESS ADDRESS: STREET 1: 495A SOUTH FAIRVIEW AVENUE CITY: GOLETA STATE: CA ZIP: 93117 BUSINESS PHONE: 8059677611 MAIL ADDRESS: STREET 1: 495-A S FAIRVIEW AVE CITY: GOLETA STATE: CA ZIP: 93117 FORMER COMPANY: FORMER CONFORMED NAME: DECKERS FOOTWEAR CORP DATE OF NAME CHANGE: 19930811 8-K 1 a4829588.txt DECKERS OUTDOOR CORPORATION 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ----------------- FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): February 24, 2005 DECKERS OUTDOOR CORPORATION - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware - -------------------------------------------------------------------------------- (State or other jurisdiction of incorporation) 0-22446 95-3015862 - -------------------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 495A South Fairview Avenue, Goleta, California 93117 - -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) Registrant's telephone number, including area code (805) 967-7611 - --------------------------------------------------- -------------------------- None - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) 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: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02. Results of Operations and Financial Condition On February 24, 2005, Deckers Outdoor Corporation issued a press release announcing financial results for the year ended December 31, 2004. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein. Item 9.01. Financial Statements and Exhibits. (c) Exhibits. Exhibit No. Description ----------- ----------- 99.1 Press release, dated February 24, 2005 The information in this Current Report on Form 8-K, including the exhibit, will not be treated as "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section. This information will not be incorporated by reference into a filing under the Securities Act of 1933, or into another filing under the Exchange Act, unless that filing expressly refers to specific information in this report. 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. Deckers Outdoor Corporation Date: February 24, 2005 /s/ M. Scott Ash ---------------- M. Scott Ash, Chief Financial Officer EX-99.1 2 a4829588ex991.txt EXHIBIT 99.1 Exhibit 99.1 Deckers Outdoor Corporation Reports Record Fourth Quarter and Fiscal Year 2004 Financial Results GOLETA, Calif.--(BUSINESS WIRE)--Feb. 24, 2005--Deckers Outdoor Corporation (NASDAQ: DECK) -- Fourth Quarter Revenue Increases 108% to a Record $74.2 Million -- Fourth Quarter Diluted EPS Increases 279% to a Record $0.72 -- Raises Fiscal 2005 EPS Guidance to a Range of $2.45 to $2.55 Deckers Outdoor Corporation (NASDAQ: DECK) today announced record financial results for the fourth quarter and fiscal year ended December 31, 2004. For the quarter ended December 31, 2004, net sales increased 108% to a record of $74.2 million versus $35.7 million in the same period last year. Net income for the quarter rose 275% to $9.2 million, compared to net income of $2.5 million last year, and income per diluted share increased 279% to $0.72, versus income per diluted share of $0.19 in the fourth quarter of 2003. Income per diluted share for the fourth quarter of 2003 was negatively impacted by $0.02 related to the repurchase of preferred stock and the repayment of subordinated debt during the quarter. For the year ended December 31, 2004, net sales increased 77% to a record $214.8 million versus $121.1 million last year. Net income increased 179% to $25.5 million, or $2.10 per diluted share, compared to net income of $9.2 million, or $0.77 per diluted share last year. Chief Executive Officer, Doug Otto, stated, "We are extremely pleased with our record fourth quarter performance as robust demand for UGG footwear, coupled with improved deliveries from the factories and strong retail sell-throughs, allowed us to once again exceed expectations. Importantly, based on feedback from retailers at the recent WSA Shoe Show we expect this positive trend for UGG to continue going forward. In addition, we were able to further leverage our fixed costs to drive significant gains in operating income and income per share for the fourth quarter. These results represent a tremendous ending to an outstanding year for our Company and we are excited as this momentum continues into 2005." Including sales from both the wholesale divisions and the Internet and catalog retailing business, Teva net sales for the year ended December 31, 2004 increased 15% to a record $88.2 million from $76.5 million in 2003; UGG net sales in 2004 increased 215% to $116.2 million versus $36.9 million last year; and, Simple net sales increased 34% to $10.3 million compared to $7.7 million a year ago. Net sales for the Internet and catalog retailing business, which are included in the brand sales numbers above, aggregated approximately $19.9 million for the year ended December 31, 2004, up 206% from $6.5 million for 2003. Mr. Otto further stated, "During fiscal 2004, we experienced solid growth in all three brands and made tremendous strides to expand the breadth, depth and reach of each of our product lines. This was evident in Teva's continued strength in the sport sandal category and growing thong and slide business, combined with the ongoing development of closed toe product to reach the much broader overall rugged outdoor footwear market. We continued to experience phenomenal growth for our entire line of UGG footwear, led by boots, slippers, and casual footwear. The successful launch of UGG licensed handbags and outerwear in 2004, as well as the 2005 introduction of UGG licensed cold weather accessories, provides the ideal complement to our footwear products and significantly enhances the true lifestyle nature of the brand. UGG was also named Brand of the Year by Footwear Plus and was recognized with the ACE Award for the "it" accessory of the year by the Accessories Counsel, both tremendous honors. Throughout 2004 we witnessed a resurgence of Simple in the marketplace, including strong performances by the brand's clog and sneaker offerings. We are confident we are on the right track with Simple and that our new product and distribution initiatives will provide further growth opportunities going forward." "During the year, we also took a number of important steps to improve our balance sheet and better position the company for the long-term," continued Mr. Otto. "This was highlighted by our successful secondary offering of Deckers common stock in May which allowed us to repay all of our outstanding loans associated with our acquisition of Teva and end fiscal 2004 free of long term debt and with more than $25 million of cash." Mr. Otto further commented, "Looking ahead, we are extremely confident about our business both for the first half and second half of fiscal 2005. For Teva, our Spring business is off to a great start and we expect another record season in 2005. At the same time, the first half of 2005 for UGG will include both carryover of Fall 2004 products as well as the shipment of UGG's first ever Spring line, with deliveries beginning in the first quarter of 2005. Our Fall 2005 UGG orders are coming in strong, once again led by our Classic and Ultra boots and slipper collection, as well as demand for our newly introduced cold weather, waterproof, Gortex (R) products and our Metropolitan category which combines sheepskin with high grade suedes and leathers. We will continue to expand our product offerings into additional footwear categories and new licensed products in order to build on UGG's growing status in the luxury goods market." Deckers also increased its guidance for 2005. The Company now expects net sales to range from $250 million to $260 million and income per diluted share to range from $2.45 to $2.55, up from the previous guidance of $220 million to $230 million and $2.15 to $2.25 per diluted share, respectively. The Company currently expects annual net sales in 2005 to be approximately $97 to $100 million for Teva, $13 to $15 million for Simple and $140 to $145 million for UGG. For the first quarter ending March 31, 2005, the Company currently expects sales to range from $63 million to $65 million and income per diluted share to range from $0.68 to $0.70. Mr. Otto concluded, "Fiscal 2004 was an extraordinary year for Deckers on a number of different levels. Financially, we consistently outperformed expectations for sales and profits; strategically we expanded the lifestyle status of our brands; and operationally we continued to leverage our brands while setting the path for future growth. Our success throughout the year was directly attributable to our powerful portfolio of leading niche brands and the hard work and dedication of our outstanding team. And while we are proud of what we have accomplished to date, we believe that many opportunities still lie ahead. We move forward with a clear and compelling growth strategy and an organization committed to delivering substantial value to our shareholders." Deckers Outdoor Corporation builds niche products into global lifestyle brands by designing and marketing innovative, functional and fashion-oriented footwear developed for both high performance outdoor activities and everyday casual lifestyle use. The Company's products are offered under the Teva(R), Simple(R) and Ugg(R) brand names, which are also its registered trademarks. All statements in this press release that are not historical facts are forward-looking statements, including the Company's estimates regarding sales and income per share results for the first quarter of 2005, and for the full year ending December 31, 2005, as well as statements regarding expected demand for UGG in 2005, the company's overall momentum going into 2005, the growth potential for licensed products, growth opportunities for the Company and its brands, the Company's confidence in its business for the first and second half of fiscal 2005, the expectations regarding the Spring 2005 Teva and Ugg business, and the ability to evolve UGG into a luxury consumer lifestyle brand, among others. These forward-looking statements are inherently uncertain and are based on the Company's expectations as of today, February 24, 2005. In addition, such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those expressed or implied by such forward-looking statements. Many of the risks, uncertainties and other factors are discussed in detail in the Company's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2003. Among the factors which could affect our financial condition and results of operations are the following: our ability to anticipate fashion trends; whether the UGG brand will continue to grow at the rate it has experienced in the recent past; possible shortages in top grade sheepskin or interruption in the supply of other materials, which could interrupt product manufacturing and increase product costs; the risk that our licensees will perform under their licenses; the risk that we are unable to accurately forecast consumer demand; the sensitivity of the footwear industry to changes in general economic conditions; whether we are successful in continuing to implement our growth strategy; the success of our customers; our ability to protect our intellectual property; our ability to develop and patent new technologies as our existing patents expire; the difficulty of matching inventory to future customer demand; the risk that counterfeiting can harm our sales or our brand image; our dependence on independent manufacturers to supply our products; the availability of products, which can affect our ability to fulfill our customers' orders; the risk that raw materials do not meet our specifications or that the prices of raw materials may increase, which would potentially cause a high return rate, a loss of sales or a reduction in our gross margins; risks of international commerce resulting from our reliance on manufacturers outside the U.S.; the risk that our manufacturers, suppliers or licensees might fail to conform to labor laws or to our ethical standards; the need to secure sufficient and affordable sources of raw materials; our reliance on licensing partners to expand our business; the challenge of managing our brands for growth; currency risk; delays and unexpected costs that can result from customs regulations; the sensitivity of our sales, particularly of the Teva(R) and UGG(R) brands, to seasonal and weather factors; our reliance on independent distributors in international markets; legal compliance challenges and political and economic risk in our international markets; the potential impact of litigation; the effect of consolidations and restructurings on our customers in the footwear industry; intense competition within the footwear industry; and the threat that terrorism could disrupt commerce in the U.S. and abroad. Given these uncertainties, prospective investors are cautioned not to place undue reliance on such forward-looking statements. The Company intends to continue its practice of not updating projections until its next quarterly results announcement. The Company disclaims any obligation to update any such factors or to publicly announce the results of any revisions to any of the forward-looking statements contained in the Company's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2003, the Company's subsequent Quarterly Reports on Form 10-Q or this news release. DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets (Unaudited) December 31, December 31, Assets 2004 2003 ------------ ------------ Current assets: Cash and cash equivalents $ 25,854,000 6,662,000 Trade accounts receivable, net 41,957,000 18,745,000 Inventories 30,260,000 18,004,000 Prepaid expenses and other current assets 1,491,000 694,000 Deferred tax assets 3,240,000 2,137,000 ------------ ------------ Total current assets 102,802,000 46,242,000 Property and equipment, at cost, net 2,838,000 2,969,000 Intangible assets, less applicable amortization 70,319,000 70,572,000 Other assets 592,000 1,243,000 ------------ ------------ $176,551,000 121,026,000 ============ ============ Liabilities and Stockholders' Equity Current liabilities: Notes payable and current installments of long-term debt $ ----- 3,792,000 Trade accounts payable 16,524,000 11,220,000 Accrued expenses 9,699,000 4,959,000 Income taxes payable 6,725,000 3,468,000 ------------ ------------ Total current liabilities 32,948,000 23,439,000 ------------ ------------ Long-term debt, less current installments ----- 26,495,000 Deferred tax liabilities-noncurrent 2,607,000 568,000 Stockholders' equity: Preferred stock ----- ----- Common stock 122,000 97,000 Additional paid-in capital 71,959,000 27,115,000 Retained earnings 68,591,000 43,052,000 Accumulated other comprehensive income 324,000 260,000 ------------ ------------ Total stockholders' equity 140,996,000 70,524,000 ------------ ------------ $176,551,000 121,026,000 ============ ============ DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Income (Unaudited) Three-month period ended Year ended December 31, December 31, ------------------------ -------------------------- 2004 2003 2004 2003 ----------- ----------- ------------ ------------ Net sales $74,172,000 35,717,000 214,787,000 121,055,000 Cost of sales 45,286,000 21,946,000 124,354,000 69,710,000 ----------- ----------- ------------ ------------ Gross profit 28,886,000 13,771,000 90,433,000 51,345,000 Selling, general and administrative expenses 14,684,000 8,880,000 47,971,000 32,407,000 Litigation income ----- ----- ----- (500,000) ----------- ----------- ------------ ------------ Net income from operations 14,202,000 4,891,000 42,462,000 19,438,000 Other expense (income): Interest, net (25,000) 1,145,000 2,236,000 4,557,000 Other 3,000 12,000 3,000 (3,000) ----------- ----------- ------------ ------------ Net income before income taxes 14,224,000 3,734,000 40,223,000 14,884,000 Income taxes 4,976,000 1,270,000 14,684,000 5,730,000 ----------- ----------- ------------ ------------ Net income 9,248,000 2,464,000 25,539,000 9,154,000 Less preferred stock redemption premium ----- (438,000) ----- (438,000) ----------- ----------- ------------ ------------ Income applicable to common stockholders $ 9,248,000 2,026,000 25,539,000 8,716,000 =========== =========== ============ ============ Net income per share: Basic $ 0.78 0.21 2.32 0.91 Diluted 0.72 0.19 2.10 0.77 =========== =========== ============ ============ Weighted-average shares: Basic 11,894,000 9,693,000 11,005,000 9,610,000 Diluted 12,817,000 10,889,000 12,142,000 11,880,000 =========== =========== ============ ============ CONTACT: Deckers Outdoor Corporation Scott Ash, 805-967-7611 or Investor Relations: Integrated Corporate Relations, Inc. Chad A. Jacobs/Brendon Frey, 203-222-9013 -----END PRIVACY-ENHANCED MESSAGE-----