Skechers' sales grew by 44 percent to $492.8 million for the first quarter ended March 31. Net income jumped to $56.1 million, compared with $7.4 million in 2009. The gross margin leapt by 11.0 percentage points to 48.2 percent and the quality of the inventory improved, meaning fewer closeouts and higher-margin sales. Average selling prices went up by 38 percent, or $6.53. Skechers reported a 16.4 percent operating margin for the period

Unit sales in the U.S. climbed by 10 percent. The management said the brand is enjoying increased penetration and shelf space in athletic specialty doors. U.S. orders improved by 52 percent over a weak quarter in 2009, but they were up by 27 percent from 2008 levels. Together, U.S. and international wholesale orders increased by 60 percent.

The women's, men's and work divisions all had double-digit growth, while the children's category increased by single digits. Sales of Skechers's more fashionable brands declined, due to changing trends and the shutdown of several lines. The company said that it had not seen any resistance from newer toning shoe lines that were 10-20 percent more expensive that previous ones.

Skechers sees continued brand momentum for the remainder of the year. The management believes that part of its forward motion can be attributed to the ?halo effect? from its targeted advertising messages, which are successfully being utilized in markets outside the U.S. in multiple languages.

Wholesale revenues outside the U.S. grew 24 percent. Sales through subsidiaries and joint ventures rose by 42 percent. High points were Germany and Brazil. New stores in Singapore and Thailand were opened, and there are plans to expand the current network of 100 points of sale in China. Also, there are plans to expand a base of 250 company-owned stores worldwide by another 15 this fiscal year. And the e-commerce business, up by 143 percent in the period from a small base a year ago, is being expanded to international markets where the company distributes its own products.

On the domestic side, the wholesale turnover was up by 52 percent. Retail sales in the U.S. and abroad combined rose by 45 percent, with a 40 percent increase at home and a whopping 132 percent increase internationally, including 10 new stores from its Chilean distributor. Combined, comparable store sales grew by 30 percent.

Selling expenses rose to 7 percent of sales, up from 6.3 percent, as the company upped its advertising and promotions, and trade show expenses increased.

On a down note, Skechers said its international distributor business, which should gain better traction in the second half, declined by 18 percent. It was partly impacted by the transfer of the business in Chile to a new subsidiary. Skechers intends to add 10 new distributor-owned stores this year to its current total of 118, including one in Mumbai, India in the third quarter and two others in Leone and Mexico City, Mexico, in the second and third quarters, respectively.

Meanwhile, Skechers is branching out into leather accessories for kids and adults as part of a deal with French Craft Leather Goods Company, a 70-year-old firm based in Los Angeles. The new collection is coming out next month, and will include belts, wallets, checkbook covers and coin purses. French Craft will design, produce and distribute the line.