Skechers U.S.A., Inc. has recently released its 10-Q report, revealing a successful first quarter of 2024. The company operates through Wholesale and Direct-to-Consumer segments, offering footwear under various brands and distributing through a wide range of channels. In the first quarter of 2024, Skechers achieved record sales of $2.25 billion, representing a 12.5% increase from the same period in 2023. The company's gross margins improved to 52.5%, and it reported diluted earnings per share of $1.33.
The Wholesale segment of Skechers saw sales increase by 9.8% to $1.42 billion, with gross margins improving to 44.7%. The Direct-to-Consumer segment also experienced growth, with sales increasing by 17.3% to $829.9 million. However, the gross margin for this segment decreased slightly to 65.7%.
Skechers' operating expenses increased by 16.9% to $882.8 million, with selling expenses rising by 21.7% and general and administrative expenses increasing by 15.9%. The company's net earnings attributable to Skechers U.S.A., Inc. reached $206.6 million, marking a 28.8% increase from the same period in 2023.
The company's cash and cash equivalents at the end of the quarter stood at $1,020.5 million, and it had unused credit capacity of $746.9 million on its revolving credit facility. Skechers believes that its anticipated cash flows from operations, existing cash and investments balances, available borrowings, and current financing arrangements will be sufficient to fund its anticipated working capital and capital requirements for the next twelve months.
In terms of cash flows, for the three months ended March 31, 2024, net cash used in operating activities was $37.6 million, compared to net cash provided of $235.1 million for the same period in 2023. The company's primary sources of operating cash are collections from customers, while its primary uses of cash are working capital, selling, general and administrative expenses, and capital expenditures.
Skechers' capital expenditures for the first quarter of 2024 were $57.1 million, and it repurchased $60.0 million of common stock during the same period. The company's capital investments remain focused on supporting its strategic growth priorities, growing its Direct-to-Consumer business, and expanding its brand internationally.
Following these announcements, the company's shares moved 1.6%, and are now trading at a price of $67.1. Check out the company's full 10-Q submission here.