Wolverine World Wide Reports 16.6% Revenue Decline in Q3 2024, Net Earnings Increase 170%

Wolverine World Wide, Inc. reported a significant decline in revenue for the third quarter of fiscal 2024, with total revenue of $440.2 million, down 16.6% from $527.7 million in the same quarter of 2023. Year-to-date revenue also decreased by 26.6%, totaling $1,260.3 million compared to $1,716.2 million in the prior year. The revenue drop was attributed to declines across various segments, particularly in the "Other" category, which saw an 83.7% decrease, largely due to reduced sales from brands like Sperry® and Hush Puppies®.

Despite the revenue decline, Wolverine experienced an increase in net earnings for the quarter, reporting $24.3 million, a 170% increase from $9.0 million in Q3 2023. This was driven by improved gross margins, which rose to 45.3% from 40.8% a year earlier, attributed to lower supply chain costs and reduced end-of-life inventory sales. Basic earnings per share for the quarter increased to $0.28, up from $0.11 in the previous year.

Operating profit for the quarter was $35.2 million, an increase from $27.3 million in Q3 2023, while year-to-date operating profit fell to $61.2 million from $118.7 million. The Active Group segment reported a slight revenue decline of 3.0% for the quarter, but operating profit increased significantly to $53.3 million, up 63% from the previous year.

Wolverine's total assets decreased to $1,758.7 million as of September 28, 2024, down from $2,231.3 million a year earlier. Current assets also fell to $762.3 million, while total current liabilities decreased to $618.6 million. The company reported long-term debt of $567.8 million, down from $716.3 million a year prior.

Strategically, Wolverine has been active in divestitures, completing several sales including the Keds® business and the Sperry® business, which contributed to cash flow but also resulted in impairment charges. The company recognized a gain of $8.5 million from a sale-leaseback transaction of its Courtland Drive facility in Q3 2024.

Cash flow from operating activities improved significantly, totaling $97.7 million year-to-date, compared to just $7.0 million in the same period last year. The company also declared cash dividends of $0.10 per share for both Q3 2024 and Q3 2023, maintaining a consistent dividend policy amidst the operational changes.