No slowdown in outdoor footwear: Merrell, Chaco parent posts record 3Q earnings, raises guidance

Wolverine Worldwide, the parent to Merrell, Chaco and Patagonia Footwear brands, reported record third-quarter 2011 earnings fueled by its outdoor division.
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Outdoor footwear brands continue to tread the rough economy without much bruising.

Wolverine Worldwide (NYSE:WWW), the parent of Merrell, Chaco and Patagonia Footwear brands, reported record third-quarter earnings with double-digit growth in both revenue and earnings per share, fueled by its outdoor division.

The Rockford, Mich.-based footwear company reported a revenue increase of 12.9 percent to $361.6 million for the third quarter, ended Sept. 30, 2011, compared to the same period a year ago. The increase was the fifth consecutive quarter of record revenue for the company.

Wolverine’s net income rose to $40.4 million, or $0.82 per diluted share, for the third quarter, up from $34.1 million, or $0.70 per diluted share, a year ago.

Wolverine’s Outdoor Group, which includes the Merrell, Chaco and Patagonia Footwear brands and accounts for 40 percent of the company’s sales, grew 19.9 percent to $145.4 million in revenue for the third quarter. The company’s Lifestyle Group – including Hush Puppies, Sebago, Cushe and Soft Style – grew 21.6 percent to $55.5 million. Its Heritage Group – including Wolverine and Caterpillar – rose 6.8 percent to $127.9 million.

Wolverine officials said sales were particularly strong on a global front, with more than 25 percent of revenue increases coming in each of the company’s Latin American, Europe/Middle East/Africa and Asia Pacific regions during the quarter. The company gained about $8.3 million in favorable foreign exchange rates against the dollar.

The positive results led company officials to raise its full-year 2011 revenue estimate to a range of $1.4 billion to $1.43 billion – representing growth of 12.1 percent to14.5 percent – and raise its diluted per share earnings estimate to a range of $2.46 to $2.52.

Investors cheered the Wolverine news on a down day for Wall Street. While the Dow Jones Industrial Average fell 2.36 percent, Oct. 3, Wolverine’s stock was up more than 4 percent.

--Compiled by David Clucas

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