Outdoor financials: Wolverine Q3 profit increases, plus VF, Timberland, Kellwood, Crocs, Liz Claiborne

Wolverine Q3 profit increases, VF names COO Eric Wiseman to replace CEO McDonald, Moody's cuts Kellwood ratings on weak sales, Timberland shares rise on analyst rating, Crocs executives exercise options, and Liz Claiborne declares regular dividend.

Wolverine Q3 profit increases

Wolverine World Wide (NYSE: WWW) said fiscal third-quarter rose 13 percent, as sales rose despite lower leather demand.

Net income for the quarter ended Sept. 8 totaled $29.5 million, or $0.54 per share, compared to $26.1 million, or $0.46 per share in the prior-year period. Revenue rose 4 percent to $310.2 million from $298.9 million a year ago.

"We are pleased to have achieved another record quarter, with strong contributions across our branded footwear groups," said Blake Krueger, the company's CEO and president, in a statement. "Our performance represents our 21st consecutive quarter of both record revenue and earnings per share. The Hush Puppies Company, the Heritage Brands Group, the Outdoor Group and the Wolverine brand all contributed to the record earnings gains in the quarter. The Merrell brand continued its portfolio-leading performance by posting double-digit gains in both revenue and earnings."

The company said a strategy of focusing on its global, higher-margin brands hurt revenue but helped gross margin. The strategy, plus expected lower demand for leather products, hurt revenue, but that was offset by growth in its core businesses, the company said.

Wolverine raised its fiscal 2007 earnings expectations based on strong third-quarter results and backlog. The company said order backlog at the end of the third quarter was up more than 11 percent.

Wolverine raised its 2007 earnings expectations to a range of $1.63 to $1.65 per share, from a previous range of $1.60 to $1.64. It said it still expects revenue to be at the lower end of a range between $1.2 billion to $1.23 billion.

For fiscal 2008, the company expects earnings of $1.78 to $1.84 per share on revenue of $1.25 billion to $1.28 billion.

In addition to owning the Wolverine and Merrell Apparel and Footwear brands, the company is the exclusive footwear licensee of Patagonia.

VF names COO Eric Wiseman to replace CEO McDonald

VF Corp. (NYSE: VFC), parent of various outdoor brands including The North Face and JanSport, said its President and COO Eric Wiseman will replace Mackey McDonald as CEO at the beginning of 2008. After the transition on Jan. 1, McDonald will continue to serve as chairman of VF's board.

As president and CEO, Wiseman, 51, will have responsibility for VF's strategic direction, execution of its long-term growth plan and day-to-day operations. As chairman, McDonald, 60, will remain involved on a full-time basis with acquisition identification, talent development programs, customer relations and board management.

"As CEO, my primary objective has been to grow the company. We are in a great place in that VF's transformation to a global lifestyle apparel company is well underway and producing outstanding results for shareholders," said McDonald in a statement. "We have achieved four consecutive years of record earnings and we anticipate another record year in 2007. In terms of management succession, I wanted to transition out of the CEO role when VF was in a very strong position with a very bright future and that's where we are today. This is the right time to implement the next step in our very successful management succession plan."

Wiseman joined VF in 1995 as executive vice president of JanSport. He became VF's executive vice president of global brands in 2005, and was appointed president and COO in 2006. He has also served on VF's board since 2006.

Moody's cuts Kellwood ratings on weak sales

Credit-ratings agency Moody's Investors Service lowered its ratings on Kellwood (NYSE: KWD), saying its women's sportswear sales have weakened rapidly.

Moody's changed its corporate family and probability of default ratings on Kellwood from "Ba2," the second-highest "junk-bond" rating, to "Ba3," which is one notch below that.

Moody's said Kellwood's sales and margins of its heritage women's sportswear business have declined faster than expected. Although the company is beginning initiatives to fix the problem, Moody's said, it expects competitive pressure in the moderate priced segments to remain. The ratings outlook is stable.

Kellwood is parent of various outdoor brands, including Sierra Designs, Kelty, Slumberjack and Royal Robbins.

Timberland shares rise on analyst rating

Shares of Timberland (NYSE: TBL) rose on Oct. 5, as an analyst initiated coverage on the company with a "Hold" rating.

Timberland has been facing lagging sales, particularly in its boots and kid's footwear business. In September, the company said it expects 2007 revenue to fall about 5 percent. In addition, it will close 40 stores as it transitions to smaller, footwear-focused stores in the United States and in certain international markets.

Brean Murray, Carret & Co. analyst David Meyer said in a note to investors that Timberland's new business alignment and apparel licensing should improve consumer focus over time. However, he said that while long-term growth opportunities exist, it could be several quarters before Timberland can take advantage of them.

Shares rose as high as $1.68 to $20.56 during afternoon trading and closed at $20.22 on Oct. 5. The stock has traded between $18.06 and $33.45 during the past 52 weeks.

Crocs executives exercise options

Various Crocs (Nasdaq: CROX) executives have been selling shares of the company's stock recently. Insiders file Form 4s with the SEC to report transactions in their companies' shares. Open market purchases and sales must be reported within two business days of the transaction.

Here's a rundown:

  • Director Raymond Croghan exercised options for 50,300 shares and then sold the shares of common stock under a prearranged trading plan. He exercised options for the shares Sept. 27 at $0.51 apiece and then sold all of them the same day for $64.90 to $65.60 apiece.
  • Michael Margolis, vice president of sales and marketing, exercised options for and sold 11,669 shares of common stock under a prearranged trading plan. He exercised options on Oct. 1 for $2.85 apiece and then sold all the shares the same day for $66.49 to $67.72 apiece.
  • President and CEO Ronald Snyder exercised options for 9,734 shares of common stock under a prearranged trading plan. He exercised the unvalued options on Oct. 1 and then sold a total of 64,464 shares owned by his wife the same day for $66.49 to $67.72 apiece.
  • On Oct. 3, Snyder exercised options for 38,936 shares of common stock under a prearranged trading plan. He exercised the options for $0.51 and $10.50 apiece and then sold 53,538 shares on the same day for $68.50 to $68.80 apiece.

All the stock sales were conducted under a prearranged 10b5-1 trading plan which allows a company insider to set up a program in advance for such transactions and proceed with them even if he or she comes into possession of material nonpublic information.

Liz Claiborne declares regular dividend

Liz Claiborne (NYSE: LIZ), parent of Prana, said its board declared a regular quarterly dividend of 5.625 cents per share. The dividend is payable Dec. 17 to shareholders of record Nov. 21.

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