Wolverine World Wide, Inc. (NYSE: WWW) today reported record fourth quarter and full year revenue and record earnings for fiscal 2002, with earnings exceeding the First Call consensus estimate.
For fiscal 2002, revenue reached a record $827.1 million, a 14.9 percent increase from the $720.1 million reported for the full year 2001. For the fourth quarter of 2002, revenue rose to a record $261.4 million, a 16.7 percent improvement from the $224.0 million reported for the fourth quarter of 2001.
Earnings for fiscal 2002 grew to a record $1.15 per share, a 7.5 percent increase from the $1.07 per share reported in 2001. Fourth quarter 2002 earnings increased to $0.42 per share, a 10.5 percent increase from the same quarter of 2001, and $0.02 per share higher than the First Call estimate.
''Fiscal 2002 was a year of significant achievement for Wolverine World Wide,'' stated Timothy J. O'Donovan, the Company's President and CEO. ''We delivered our third consecutive year of record revenue, generated record profits and made significant reductions in working capital, all of which contributed to record cash flow during 2002. The Company's strong performance was fueled by Merrell, which realized over a 30 percent revenue increase, well in excess of the planned growth rate for the business. Since acquiring Merrell five years ago, the business has grown over sevenfold, and is now the Company's leading profit producing brand. We are also pleased with the number of other businesses which contributed to the Company's 2002 results. The Hush Puppies Company benefited from strong performances from its U.K. and Canadian wholesale and International Licensing operations. The recently acquired CAT(R) and Merrell(R) European operations performed as planned in this transition year, accounting for more than two-thirds of the Company's year-over-year revenue increase while generating profits slightly above the breakeven level.''
Stephen L. Gulis Jr., the Company's CFO, reported, “On a pre-acquisition basis, full year 2002 gross margins increased 50 basis points to 36.2 percent compared to the 35.7 percent reported during fiscal 2001. Including acquisitions, full year gross margins were 35.6 percent.
''Excluding acquisitions, selling and administrative expenses as a percent of revenues increased 80 basis points for fiscal 2002 to 26.1 percent, compared to the 25.3 percent reported in 2001. This increase reflects higher employee benefit costs, including a significant increase in pension expense caused by current financial market conditions. Including acquisitions, selling and administrative expenses as a percent of revenues grew 100 basis points to 26.3 percent for full year 2002, reflecting startup investment for Merrell Europe. Record cash flow from operating activities exceeded $85.0 million during 2002, as asset management programs yielded positive results. On a pre-acquisition basis, inventories and accounts receivable at year end declined 16.6 percent and 7.6 percent respectively. Looking to 2003, we are starting the year with a strong order backlog, up 19 percent from year end 2001 levels, with orders scheduled for first half delivery improving by approximately 15 percent. For fiscal 2003, we continue to anticipate revenues reaching the $875 to $885 million range, and earnings improving to a range of $1.21 to $1.24 per share. The EPS guidance for 2003 includes the previously disclosed $0.11 per share increase in pension expense.''
The Company will host a conference call at 10:00 a.m. EST today to discuss these results and current business trends. To listen to the call at the Company's website, go to www.wolverineworldwide.com , click on “For Our Investors” in the navigation bar, click on “Conference Call” from the top navigation bar of the “For Our Investors” page, and then click on “Webcast.” To listen to the webcast, your computer must have Windows Media Player, which can be downloaded for free at www.wolverineworldwide.com . In addition, the conference call can be heard at. A replay of the call will be available at the Company's website through February 19, 2003.
With a commitment to service and product excellence, Wolverine World Wide, Inc. is one of the world's leading marketers of branded casual, active lifestyle, work, outdoor sport and uniform footwear and slippers. The Company's portfolio of highly recognized brands includes: Bates(R), Hush Puppies(R), HYTEST(R), Merrell(R) and Wolverine(R). The Company also markets footwear under popular licensed brands including CAT(R), Harley-Davidson(R) and Stanley(R). The Company's products are carried by leading retailers in the U.S. and are distributed internationally in over 140 countries. For additional information, please visit our website, www.wolverineworldwide.com .