Steven Madden, Ltd. (NASDAQ:SHOO) Q1 2018 Earnings Conference Call - Final Transcript

Apr 20, 2018 • 08:30 am ET


Steven Madden, Ltd. (NASDAQ:SHOO) Q1 2018 Earnings Conference Call - Final Transcript


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Thank you for standing by. Good day, and welcome to the Steve Madden First Quarter 2018 Earnings Conference Call. Today's conference is being recorded. And at this time, I'd like to turn the call over to Jean Fontana of ICR. Please go ahead.

Jean Fontana

Thank you. Good morning, everyone. Thank you for joining us today for the discussion of Steve Madden's first quarter 2018 earnings results. Before we begin, I'd like to remind you that statements made on this call that are not statements of historical facts constitute forward-looking statements under the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties and other unknown factors that could cause actual results to differ materially from historical facts or any future results expressed or implied in the forward-looking statements.

These statements contained herein are also subject to the risks and uncertainties as described from time-to-time in the Company's reports and registration statements filed with the SEC. Please refer to the Company's earnings release for information on the factors that could cause actual results to differ. Finally, please note that any forward-looking statements used on today's call cannot be relied upon as current after today's date. Hosting the call today are Ed Rosenfeld, the Chairman and CEO of Steve Madden; and Danielle McCoy, Director and Corporate Development and Investor Relations. With that, I will turn it over to Danielle.

Danielle McCoy

Thanks, Jean, and good morning, everyone. Before I turn the call over to Ed, I'd like to note that the financial results presented below are on an adjusted basis, unless otherwise noted. Please refer to our press release for a reconciliation of GAAP to non-GAAP financial measures. Ed?

Edward Rosenfeld

Thanks, Danielle. Good morning, everyone, and thank you for joining us to review Steve Madden's first quarter 2018 results. We got off to a good start in 2018 with net sales growth of 6% and diluted EPS growth of 14% compared to the first quarter of 2017. In light of the retail backdrop, which while improved remains challenging as well as tough comparisons from the prior year period, we were very pleased with these results.

Our Wholesale Footwear business recorded strong performance in the quarter with net sales growing 5%, including increases in both our Branded and Private Label businesses. We remain pleased with the performance in our flagship Steve Madden brand where Steve and his design team continue to create outstanding product assortments that are resonating with consumers and enabling us to outperform the competition. In the first quarter, we saw strength across a range of categories, most notably sneakers and sandals. We also saw outstanding performance in the international markets where we had strong growth across the Board.

We saw increases in our directly owned subsidiaries in Canada and Mexico, in our SM Europe JV, and in our distributor business. Our Private Label Footwear business also accelerated, increasing over 10% in the quarter compared to the prior year. In Wholesale Accessories, net sales increased 8% compared to the