-----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, B/LT8XhtT3NgkkyiAmwUwEcs6Ufuug6r1KwC+Bs16imbqiqvKzodKrwHVWrnFlFI eg90gobYhsMz1L9EqBYEeQ== 0001157523-07-010251.txt : 20071025 0001157523-07-010251.hdr.sgml : 20071025 20071025161022 ACCESSION NUMBER: 0001157523-07-010251 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20071025 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20071025 DATE AS OF CHANGE: 20071025 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: 071190992 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 a5528483.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): October 25, 2007 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 ----------------------------- - -------------------------------------------------------------------------------- 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 October 25, 2007, Deckers Outdoor Corporation issued a press release announcing its financial results for the three months ended September 30, 2007 and held a conference call regarding its financial results for the third quarter of 2007 ended September 30, 2007. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated by reference herein. The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. Item 9.01. Financial Statements and Exhibits. (d) Exhibits. Exhibit No. Description ----------- ----------- 99.1 Press release, dated October 25, 2007 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: October 25, 2007 /s/ Zohar Ziv ---------------------------------- Zohar Ziv, Chief Financial Officer EX-99.1 2 a5528483ex99-1.txt EXHIBIT 99.1 Exhibit 99.1 Deckers Outdoor Corporation Reports Record Third Quarter Financial Results Company Reports Third Quarter Sales Increased 57.2% to $129.4 Million Third Quarter Diluted Earnings Per Share Increased 81.5% to $1.47 Company Increases Fiscal 2007 Guidance Growth Targets GOLETA, Calif.--(BUSINESS WIRE)--Oct. 25, 2007--Deckers Outdoor Corporation (NASDAQ: DECK) today announced financial results for the third quarter ended September 30, 2007. Third Quarter Highlights -- Net sales increased 57.2% to $129.4 million compared to $82.3 million last year. -- Diluted EPS increased 81.5% to $1.47 from $0.81, as restated, and ahead of previous guidance of approximately $1.20 -- UGG(R) Brand sales increased 67.5% to $113.7 million compared to $67.9 million a year ago. -- Total international sales increased 58.0% to $14.2 million compared to $9.0 million last year. Angel Martinez, President and Chief Executive Officer, stated, "Our record third quarter performance was driven by strong full price selling of UGG brand product throughout the United States coupled with growing demand for the brand overseas. Consumer reaction to the UGG brand's fall line has been extremely favorable which we believe underscores the progress we have made evolving the product offering, increasing the breadth and depth of each collection and enhancing the brand's image as the leader in luxury comfort. In addition, our success at penetrating new geographic regions, increasing shelf space and broadening our target market also contributed to our better than expected results. We move forward with positive momentum in our business, a solid infrastructure to support our growth objectives both domestically and overseas, and a long-term strategic development plan designed to maximize the opportunities for each of our leading brands." Segment Summary UGG(R) UGG Brand net sales for the third quarter increased 67.5% to $113.7 million compared to $67.9 million in the third quarter of 2006. Domestic sales were fueled by robust consumer demand for the entire product line, including boots, slippers, casuals, men's, kids', and the new high-end fashion collection, coupled with strong international growth. Teva(R) Teva Brand net sales for the third quarter increased 12.1% to $11.2 million compared to $10.0 million for the same period last year. Teva's results were driven by increased sell-through for sandals as well as the positive reaction to the brand's expanded closed-toe product offering. Simple(R) Simple Brand net sales were $4.4 million for both the third quarter of 2007 and the third quarter of 2006. Simple's performance was negatively impacted by shipping delays for ecoSNEAKS(TM) as a result of production issues, which have been resolved. Despite this, ecoSNEAKS(TM) had a very solid debut across multiple channels of distribution while Green Toe(R) was successful in opening more mainstream accounts this fall. Consumer Direct Sales for the Consumer Direct business, which are included in the brand sales numbers above, increased 82.3% to $10.6 million compared to $5.8 million for the same period a year ago, mostly due to an increase in UGG Brand internet sales. In addition, results for the third quarter of 2007 included sales from the Company's UGG Brand flagship store in New York City and two retail outlet stores in Riverhead and Woodbury Common, New York, which were not in operation in the third quarter of 2006. Full-Year 2007 Outlook -- The Company is increasing its 2007 full year revenue growth target to approximately 39% over 2006, up from previous guidance of approximately 35%. -- The Company is increasing its 2007 full year diluted earnings per share growth target to approximately 35% over 2006 before the restatement adjustments as disclosed in the Company's Form 10-K/A for the year ended December 31, 2006 and the $15.3 million pre-tax impairment loss attributable to our Teva trademark that was recorded in the fourth quarter of 2006, up from previous guidance of approximately 25%. -- Fiscal 2007 guidance includes approximately $5.3 million of stock compensation expense, an increase of $3.2 million over 2006, and approximately $2.4 million of expenses related to the investigation and restatement of the Company's consolidated financial statements. Fourth Quarter Outlook -- The Company is also increasing its fourth quarter 2007 revenue target to approximately 35% and its diluted earnings per share target to approximately 15% compared to the fourth quarter of 2006, before the restatement adjustment and impairment charge. This is up from its previous revenue and diluted earnings per share growth targets of 30% and 10%, respectively. The Company's conference call to review third quarter fiscal 2007 results will be broadcast live over the internet today, Thursday, October 25, 2007 at 4:30 pm Eastern Time. The broadcast will be hosted at www.deckers.com and www.earnings.com. 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. Teva(R), Simple(R) and UGG(R) are registered trademarks of Deckers Outdoor Corporation. This news release contains statements regarding our expectations, beliefs and views about our future financial performance which are "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the use of words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," or future or conditional verbs such as "will," "would," "should," "could," or "may" or by the fact that such statements relate to future, and not just historical, events or circumstances, including statements related to anticipated revenues, expenses, earnings, operating cash flows, the outlook for the Company's markets and the demand for its products. The forward-looking statements in this news release regarding our future financial performance are based on currently available information as of the date of this release, and because our business is subject to a number of risks and uncertainties, actual operating results in the future may differ significantly from the future financial performance expected at the current time. Those risks and uncertainties include, among others: the results of the Company's settlement of the underpayment of certain tax obligations to authorities in China for one of the Company's foreign subsidiaries, Holbrook Limited, a Hong Kong company; our ability to anticipate fashion trends, consumer demand or inventory needs; whether the UGG brand will continue to grow at the same rate it has experienced in the recent past; shortages or price fluctuations of raw materials that could interrupt product manufacturing and increase product costs; our ability to implement our growth strategy; the success of our customers and the risk of losing one or more of our key customers; our ability to develop and protect our brands and intellectual property; the risk that counterfeiting can harm our sales or our brand image; our dependence on independent manufacturers to supply our products; the risk that retailers could postpone or cancel existing orders; unpredictable events and circumstances and currency risks related to our international operations; a downturn in key market economies; the risk of losing key personnel; and the sensitivity of our sales to seasonal and weather conditions. Certain of these risks and uncertainties, as well as others, are more fully described under the heading "Risk Factors" in the Company's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2006 which we filed with the Securities and Exchange Commission on October 11, 2007. Readers are cautioned not to place undue reliance on forward-looking statements contained in this news release, which speak only as of the date of this release. The Company undertakes no obligation to publicly release or update the results of any revisions to forward-looking statements, which may be made to reflect new information, events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. The risks and uncertainties highlighted herein should not be assumed to be the only items that could affect the future performance of the Company. DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets (Unaudited) (Amounts in thousands) September 30, December 31, 2007 2006 ------------- ------------- Assets Current assets: Cash and cash equivalents $ 39,308 34,255 Restricted cash 250 ---- Short-term investments 35,405 64,637 Trade accounts receivable, net 74,354 49,571 Inventories 88,050 32,375 Prepaid expenses and other current assets 2,935 2,199 Deferred tax assets 4,386 4,386 ------------- ------------- Total current assets 244,688 187,423 Restricted cash 1,000 ---- Property and equipment, at cost, net 8,711 7,770 Intangible assets, less applicable amortization 54,166 54,399 Deferred tax assets 327 327 Other assets 73 54 ------------- ------------- $ 308,965 249,973 ============= ============= Liabilities and Stockholders' Equity Current liabilities: Trade accounts payable $ 31,146 21,053 Accrued expenses 13,754 10,949 Income taxes payable 5,096 7,561 ------------- ------------- Total current liabilities 49,996 39,563 ------------- ------------- Stockholders' equity: Common stock 130 126 Additional paid-in capital 99,439 81,761 Retained earnings 159,178 128,130 Accumulated other comprehensive income 222 393 ------------- ------------- Total stockholders' equity 258,969 210,410 ------------- ------------- $ 308,965 249,973 ============= ============= DECKERS OUTDOOR CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Income (Unaudited) (Amounts in thousands, except for per share data) Three-month period Nine-month period ended ended September 30, September 30, --------------------- ---------------------- 2007 2006 2007 2006 ---------- ---------- ---------- ---------- As As Restated Restated Net sales $ 129,381 82,322 $ 254,686 180,047 Cost of sales 70,666 45,266 140,865 99,436 ---------- ---------- ---------- ---------- Gross profit 58,715 37,056 113,821 80,611 Selling, general and administrative expenses 28,055 19,865 65,225 50,684 ---------- ---------- ---------- ---------- Income from operations 30,660 17,191 48,596 29,927 Other (income) expense, net: Interest income (851) (688) (3,504) (1,985) Interest and other expense, net 207 163 781 356 ---------- ---------- ---------- ---------- Income before income taxes 31,304 17,716 51,319 31,556 Income taxes 11,974 7,336 20,271 13,178 ---------- ---------- ---------- ---------- Net income $ 19,330 10,380 $ 31,048 18,378 ========== ========== ========== ========== Net income per share: Basic $ 1.49 0.83 $ 2.43 1.47 Diluted 1.47 0.81 2.37 1.44 ========== ========== ========== ========== Weighted-average shares: Basic 12,973 12,531 12,784 12,503 Diluted 13,117 12,831 13,095 12,805 ========== ========== ========== ========== CONTACT: Deckers Outdoor Corporation Zohar Ziv, 805-967-7611 Chief Financial Officer and Executive Vice President of Finance and Administration or Investor Relations: Integrated Corporate Relations, Inc. Chad A. Jacobs/Brendon Frey 203-682-8200 -----END PRIVACY-ENHANCED MESSAGE-----