Traverse City Record-Eagle

February 20, 2013

Wolverine's aquisition results in a 4Q loss


Traverse City Record-Eagle

---- — ROCKFORD (AP) — Footwear and clothing company Wolverine Worldwide moved to a loss in its fourth quarter, mostly because of costs for its acquisition of shoe brands including Sperry Top-Sider.

The company, whose brands include Hush Puppies and Merrell, lost $3.7 million, or 8 cents per share, for the period ended Dec. 29. That compares with a profit of $23 million, or 47 cents per share, a year ago.

The current quarter included more than $24 million in transaction and integration costs and $3.8 million for an acquisition-related interest expense. Wolverine Worldwide completed its $1.25 billion buyout of the performance and lifestyle group from Collection Brands Inc. during the quarter. The performance and lifestyle group includes the Sperry Top-Sider, Saucony, Stride Ride and Keds brands.

Removing transaction and integration costs, earnings were 48 cents per share.

Analysts predicted earnings of 16 cents per share, according to a FactSet survey.

Wolverine said Tuesday that its performance was helped by better-than-expected results from its existing business and the performance and lifestyle group acquisition from Collective Brands, as well as lower-than-expected acquisition-related costs.

The company had forecast quarterly earnings of 12 cents to 22 cents per share.

Selling, general and administrative expenses climbed to $207.2 million from $119.2 million.

Revenue increased 60 percent to $652.2 million from $406.5 million. Wall Street forecast $651.3 million.

Cost of products sold jumped to $408.4 million from $256.3 million.

For the year, Wolverine Worldwide Inc. earned $80.7 million, or $1.63 per share. That compares with a profit of $123.3 million, or $2.48 per share, in the prior year.

Adjusted earnings were $2.29 per share.

Annual revenue rose 16 percent to $1.64 billion from $1.41 billion.

Going forward, the Rockford, Mich., company foresees fiscal 2013 adjusted earnings between $2.50 and $2.65 per share. Revenue is expected in a range of $2.7 billion to $2.8 billion.

Analysts expect earnings of $2.86 per share on revenue of $2.72 billion.