Deckers Outdoor Corporation, parent company of Teva, Ugg, Sanuk and other brands reported a lower than expected loss of $20.1 million for the second quarter ended June 30, up from $7.5 million in the same period a year ago, but the gross margin declined to 42.2 percent from 42.7 percent.
Overall revenues were 13.1 percent higher at $174.4 million. Ugg' sales were virtually stable at $107.9 million, but they were down in Europe as the brand's largest distributors cut back their orders because of high inventories and the poor economy. Still, the management felt that the European situation has stabilized, considering strong sell-throughs at U.K. retailers and a same-store gains at the brand's concept stores
Teva's sales were off by 15.4 percent to $34.1 million due to lower sales outside the U.S., where wholesale and e-commerce reached record levels.
Sanuk, which is part of the group since July 2011, generated sales of $28 million in the latest quarter, with strong double-digit increases in sandals and closed-toe shoes and a growing momentum in Asia. The brand presented its collections for the first time at the OutDoor show in Friedrichshafen earlier this month.
James Petrie, who previously worked for Vans, has been named as the new European brand manager for this American brand of surf-inspired casual footwear. Deckers is using the same distributors as before for Sanuk in Europe in a transition phase, supporting them with its own offices in the U.K., France and the Benelux.
Other brands - Ahnu, Mozo and Tsubo - saw their sales go down by 21.2 percent to $4.5 million because of the phaseout of Simple from this segment.
In a new diversification, Deckers has taken a 25 percent stake in Hoka One One, a French brand of trail running shoes, with a call option for more. Its oversize technology will first be applied to six styles of Ugg shoes that will be launched later this year (more in SGI Europe and its Outdoor Industry Compass).