Crocs saw its revenues increase by 1.6 percent to $228,673 in the fourth quarter of 2013. For the full year, the American footwear company's revenues increased by 6.2 percent to $1,192,680. On a constant currency basis, the increase was of 4.1 percent and 8.8 percent in the fourth quarter and full year, respectively.
In terms of volume, the company reports an increase in deliveries of 9 percent to a record 54.3 million pairs for the past year. The positive sales performance, despite challenging retail environment in North America and import restrictions in Latin America, was driven by a solid increase in wholesale revenues, with particular strength in Europe, as well as Crocs' global retail expansion.
European revenues jumped by 27.6 percent to €216.3 million for the year, with increases of 18.3 percent to $131.2 million for wholesale revenues, 13.1 percent to $26.5 million for sales over the internet, and 66.9 percent to $58.5 million through Crocs' retail stores.
European sales were up by 46.2 percent to $40.8 million in the last quarter, thanks in part to the appreciation of the euro against the dollar. In terms of local currencies, They rose in the quarter by 7.1 percent at the wholesale level and by 16.7 percent at retail.
However, the profitability of the company declined last year, and its new owners are insisting that the focus will be more on profits rather than sales in the future.
In the fourth quarter, the company incurred a net loss of $66.9 million, up sharply from a net loss of $3.6 million in the comparable quarter in the prior year. This was mainly due to $49.2 million in non-recurring, unusual and infrequent charges. Excluding these items, the quarterly net loss was $17.7 million in the quarter compared with net income of $4.4 million in the fourth quarter of 2012.
For the full year, net income plunged to $10.4 million as compared to $131.3 million in 2012. Excluding non-recurring, unusual and infrequent charges totaling $62.4 million, the company generated net income of $72.8 million, still down as compared to $129.1 million during 2012.
The gross margin declined to 52.3 percent for the year from 54.1 percent in 2012. Besides unfavorable changes in foreign exchange currencies, the management mentioned among the factors rising product costs and the evolution of the product assortment, with many less basic styles than before.
Wholesale revenues grew to $673.8 million for the full year, up by 4.3 percent in dollars and by 7.3 percent at constant exchange rates.
Retail revenues grew to $418.0 million, representing an increase of 11.5 percent, or 13.9 percent in local currencies. In the Americas, the most important region for the company, sales over the internet declined by 1.7 percent to $100.9 million, with increases in Europe and Asia offset by declines of 10.5 percent in the Americas and 10.1 percent in Japan. Other retail sales reached $202.9 million, up 3.2 percent against 2012 or 3.7 percent at constant exchange rates, and they were down in dollars only in Japan. Internet sales grew in the fourth quarter.
As previously reported, Crocs is looking for a new chief executive as John McCarvel, currently president, chief executive officer and board member, will be retiring by April 30.
The company said that the focus, in this transition year, will be on improving financial performance, particularly in the Americas and Japan, as well as enhancing global retail execution, and on prioritizing earnings over top-line growth.