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Crocs Q1 sales drop, expects larger decline in Q2

By Prachi Singh

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Business

Crocs, Inc. reported revenues of 281.2 million dollars, declining 5 percent from the first quarter of 2019, or 3.3 percent on a constant currency basis. The company said in a statement that currency negatively impacted first quarter revenues by approximately 5.2 million dollars, while wholesale revenues declined 5.6 percent and retail comparable store sales grew 7.5 percent with total retail revenues down 15 percent due to Covid-19 closures. The company added that decline in wholesale and retail were partially offset by e-commerce revenue growth of 15.8 percent. Diluted earnings per share fell to 16 cents, compared with 33 cents, while adjusted diluted earnings per share were 22 cents compared to 36 cents in the first quarter of 2019

Commenting on the first quarter trading, Andrew Rees, President and Chief Executive Officer, said: “Amidst unprecedented market conditions globally, our total revenue held up well with exceptional performance in our Americas and e-commerce businesses that was overshadowed by Covid-19 related store closures. In the near-term, we have no liquidity concerns and have taken quick action to ensure we will be strongly cash flow positive for the remainder of the year.”

Crocs estimates larger revenue decline for Q2

The company further said that Covid-19 has impacted the Crocs business globally, including through store closures or reduced operating hours and decreased retail traffic. Many of the 367 company-operated stores as well as many partner stores and wholesale customers’ stores were closed at some point during the first quarter and many remain closed today.

At this time, the company estimates that stores will begin to open in stages over the coming months and expects revenue declines to continue in retail and wholesale channels as “social distancing” practices remain in effect. Crocs also expects a larger decline in revenues in the second quarter of 2020, as the majority of retail and partner stores may be closed for the whole period.

Picture:Facebook/Crocs

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