Crocs (CROX) Tops Q4 EPS by 5c, Q1 Revenue Guidance Misses

Crocs (NASDAQ: CROX) reported Q4 EPS of $0.12, $0.05 better than the analyst estimate of $0.07. Revenue for the quarter came in at $263 million versus the consensus estimate of $260.08 million.

GUIDANCE:

Crocs sees Q1 2020 revenue of $305-325 million, versus the consensus of $342.9 million.

• Revenues to be between $305 and $325 million compared to $295.9 million in the first quarter of 2019. We anticipate revenues for the first quarter of 2020 will be negatively impacted by approximately $20 to $30 million due to disruptions to our Asia business from COVID-19 (the “coronavirus”) and by approximately $3 million due to currency;
• Many of our partner stores in China are closed temporarily. For those that remain open, they are operating on a reduced schedule and experiencing lower than usual traffic levels. We are also seeing the broader impact as we are experiencing traffic declines throughout many of our key countries in Asia.
• Operating margin to be between 9% and 12%, including $3 million of non-recurring expenses for store closures and other provisions in Asia as a result of business disruptions from the coronavirus.

Full Year 2020:

With respect to 2020, we expect:

• Revenues to be up 8% to 12% over 2019 revenues of $1,230.6 million. We anticipate 2020 revenues will be negatively impacted by $40 to $60 million as a result of disruptions to our Asia business from the coronavirus and approximately $10 million of currency;
• An operating margin of between 11% and 13%, which includes expenses associated with our new distribution center in the Netherlands and charges for store closures and other provisions in Asia as a result of business disruptions from the coronavirus;
• Interest expense of approximately $9 million; and
• A tax rate of approximately 17%.

For earnings history and earnings-related data on Crocs (CROX) click here.

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