Steve Madden Announces Fourth Quarter and Full Year 2019 Results and Provides Initial Fiscal Year 2020 Revenue and EPS Guidance
LONG ISLAND CITY, N.Y., Feb. 27, 2020 (GLOBE NEWSWIRE) -- Steve Madden (Nasdaq: SHOO), a leading designer and marketer of fashion-forward footwear, accessories and apparel for women, men and children, today announced financial results for the fourth quarter and full year ended December 31, 2019, and provided initial fiscal year 2020 revenue and EPS guidance.
Amounts referred to as “Adjusted” exclude the items that are described under the heading “Non-GAAP Adjustments.”
The Company reclassed commission and licensing fee income to Total Revenue and reclassed its respective expenses into Operating Expenses from previously labeled Commission and Licensing Fee Income - Net on the Company's Consolidated Statement of Operations for each period provided.
For the Fourth Quarter 2019:
- Revenue increased 0.7% to $419.6 million compared to $416.8 million in the same period of 2018.
- Gross margin was 37.7% compared to 38.1% in the same period last year. Adjusted gross margin was 37.8% in 2019.
- Operating expenses as a percentage of revenue were 33.1% compared to 32.1% in the same period of 2018. Adjusted operating expenses as a percentage of revenue were 30.0% compared to 29.0% in the same period of 2018.
- Income from operations totaled $19.5 million, or 4.6% of revenue, compared to $25.0 million, or 6.0% of revenue, in the same period of 2018. Adjusted income from operations was $33.0 million, or 7.9% of revenue, compared to Adjusted income from operations of $37.9 million, or 9.1% of revenue, in the same period of 2018.
- Net income attributable to Steven Madden, Ltd. was $17.8 million, or $0.21 per diluted share, compared to $12.5 million, or $0.15 per diluted share, in the prior year’s fourth quarter. Adjusted net income attributable to Steven Madden, Ltd. was $32.2 million, or $0.39 per diluted share, compared to $35.7 million, or $0.42 per diluted share, in the prior year’s fourth quarter.
Edward Rosenfeld, Chairman and Chief Executive Officer, commented, “We are pleased to have achieved Adjusted diluted EPS at the high end of our guidance range for the fourth quarter and full year 2019. Fiscal year 2019 was a strong year for the Company, with revenue and Adjusted diluted EPS increasing mid-single digits on a percentage basis compared to the prior year despite significant headwinds from the bankruptcy of Payless ShoeSource and the tariffs implemented on accessories, footwear and apparel from China.
“Looking ahead, while we are cautious on the near-term outlook due to additional headwinds from the coronavirus outbreak, China tariffs and the termination of the Kate Spade footwear license, we are confident that the strength of our brands and our business model will enable us to drive earnings growth and shareholder value creation over the long term.”
Fourth Quarter 2019 Segment Results
Revenue for the wholesale business decreased 1.1% to $313.8 million in the fourth quarter of 2019 due primarily to a decrease in wholesale accessories/apparel revenue. Wholesale footwear revenue declined 0.2% with a decline in the branded business offset by a gain in private label. Wholesale accessories/apparel revenue decreased 3.6% driven by declines in private label handbags and cold weather accessories, partially offset by the addition of the BB Dakota apparel business. Gross margin in the wholesale business decreased to 29.2% compared to 30.1% in last year’s fourth quarter driven by tariffs on goods imported from China.
Retail revenue in the fourth quarter rose 8.7% to $101.1 million compared to $93.0 million in the fourth quarter of the prior year. Same store sales increased 6.7% in the quarter driven by strong performance in the Company’s e-commerce business. Retail gross margin was 61.2% in the fourth quarter of 2019 compared to 61.0% in last year's fourth quarter. Adjusted gross margin in the retail segment increased to 61.6% in the fourth quarter of 2019 compared to 61.0% in the fourth quarter of the prior year due to a reduction in promotional activity.
The Company ended the quarter with 227 company-operated retail locations, including eight Internet stores, as well as 31 company-operated concessions in international markets.
The Company’s effective tax rate for the fourth quarter of 2019 was 15.9% compared to 52.7% in the fourth quarter of 2018. On an Adjusted basis, the effective tax rate was 6.3% compared to 9.2% in the fourth quarter of the prior year due to the impact of the year-over-year benefit resulting from the exercising and vesting of share-based awards.
Full Year Ended December 31, 2019
For the full year ended December 31, 2019, revenue increased 6.5% to $1.8 billion from $1.7 billion in the prior year.
Net income attributable to Steven Madden, Ltd. was $141.3 million, or $1.69 per diluted share, for the year ended December 31, 2019 compared to net income of $129.1 million, or $1.50 per diluted share, for the year ended December 31, 2018. On an Adjusted basis, net income attributable to Steven Madden, Ltd. was $162.8 million, or $1.95 per diluted share, for the year ended December 31, 2019 compared to net income of $157.7 million, or $1.83 per diluted share, for the year ended December 31, 2018.
Balance Sheet and Cash Flow
During the fourth quarter of 2019, the Company repurchased 589,809 shares of the Company’s common stock for approximately $25.3 million, which includes shares acquired through the net settlement of employee stock awards. For the full year ended December 31, 2019, the Company repurchased 3.0 million shares of the Company's common stock for approximately $101.8 million, which includes shares acquired through the net settlement of employee stock awards.
As of December 31, 2019, cash, cash equivalents and current marketable securities totaled $304.6 million.
Quarterly Dividend
The Company’s Board of Directors approved a quarterly cash dividend of $0.15 per share. The dividend will be paid on March 27, 2020, to stockholders of record at the close of business on March 17, 2020.
Fiscal Year 2020 Outlook
For fiscal year 2020, the Company expects revenue will increase 0% to 1% over revenue in 2019. The Company expects diluted EPS for fiscal year 2020 will be in the range of $1.70 to $1.80. Compared to the prior year, the diluted EPS range reflects an adverse impact of approximately $0.35 from the combined impact of the coronavirus, tariffs on goods from China, the termination of the Kate Spade footwear license and a higher anticipated tax rate.
Non-GAAP Adjustments
Amounts referred to as “Adjusted” exclude the items below.
For the fourth quarter 2019:
- $8.9 million pre-tax ($8.9 million after-tax) vendor support associated with the Payless ShoeSource bankruptcy, included in operating expenses.
- $4.0 million pre-tax ($3.0 million after-tax) expense in connection with a provision for a legal settlement and related fees, included in operating expenses.
- $0.4 million pre-tax ($0.3 million after-tax) expense in connection with the termination of a joint venture, included in cost of goods sold; $0.2 million pre-tax ($0.1 million after-tax) expense in connection with the termination of a joint venture, included in operating expenses; and $0.2 million after-tax income in connection with the termination of a joint venture, included in net loss attributable to noncontrolling interest.
- $0.04 million pre-tax ($0.03 million after-tax) expense in connection with the acquisitions of GREATS and BB Dakota, included in operating expenses.
- $2.2 million tax expense in connection with deferred tax and other tax adjustments.
For the fourth quarter 2018:
- $12.1 million pre-tax ($11.5 million after-tax) in bad debt expense and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcy, included in operating expenses.
- $0.5 million pre-tax ($0.3 million after-tax) expense in connection with a provision for early lease termination charges, included in operating expenses.
- $0.3 million pre-tax ($0.2 million after-tax) expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring, included in operating expenses.
- $11.1 million tax expense resulting from the Tax Cuts and Jobs Act transition tax and prepaid tax adjustments related to prior years.
For the fiscal year 2019:
- $8.7 million pre-tax ($8.6 million after-tax) vendor support, net of recovery of bad debt expense associated with the Payless ShoeSource bankruptcy, included in operating expenses.
- $5.4 million pre-tax ($4.1 million after-tax) expense in connection with early lease termination charges and the impairment of lease right-of-use assets.
- $4.1 million pre-tax ($3.0 million after-tax) non-cash expense associated with the impairment of the Brian Atwood trademark.
- $4.0 million pre-tax ($3.0 million after-tax) expense in connection with provision for a legal settlement and related fees, included in operating expenses.
- $1.9 million pre-tax ($1.4 million after-tax) net benefit associated with the change in a contingent liability and the acceleration of amortization related to the termination of the Kate Spade license agreement as of December 31, 2019.
- $1.1 million pre-tax ($0.8 million after-tax) expense in connection with the acquisitions of GREATS and BB Dakota, included in operating expenses.
- $0.7 million pre-tax ($0.5 million after-tax) expense in connection with a divisional headquarters relocation.
- $0.4 million pre-tax ($0.3 million after-tax) expense in connection with the termination of a joint venture, included in cost of goods sold; $0.2 million pre-tax ($0.1 million after-tax) expense in connection with the termination of a joint venture, included in operating expenses; and $0.2 million after-tax income in connection with the termination of a joint venture, included in net income attributable to noncontrolling interest.
- $2.6 million tax expense in connection with deferred tax and other tax adjustments.
For the fiscal year 2018:
- $12.1 million pre-tax ($11.5 million after-tax) in bad debt expense and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcy, included in operating expenses.
- $2.8 million pre-tax ($2.1 million after-tax) expense in connection with a provision for a settlement, included in operating expenses.
- $2.1 million pre-tax ($1.5 million after-tax) expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring, included in operating expenses.
- $1.2 million pre-tax ($0.9 million after-tax) expense in connection with a warehouse consolidation, included in operating expenses.
- $1.0 million tax expense in connection with the impairment of the preferred interest investment in Brian Atwood Italia Holding, LLC recorded in fourth quarter 2017.
- $0.5 million pre-tax ($0.3 million after-tax) expense in connection with a provision for early lease termination charges, included in operating expenses.
- $11.1 million tax expense resulting from the Tax Cuts and Jobs Act transition tax and prepaid tax adjustments related to prior years.
Reconciliations of amounts on a GAAP basis to Adjusted amounts are presented in the Non-GAAP Reconciliation tables at the end of this release and identify and quantify all excluded items.
Conference Call Information
Interested stockholders are invited to listen to the fourth quarter and fiscal year 2019 earnings conference call scheduled for today, February 27, 2020 at 8:30 a.m. Eastern Time. The call will be broadcast live over the Internet and can be accessed by logging onto http://stevemadden.gcs-web.com. An online archive of the broadcast will be available within two hours of the conclusion of the call and will be accessible for a period of 30 days following the call.
About Steve Madden
Steve Madden designs, sources and markets fashion-forward footwear, accessories and apparel for women, men and children. In addition to marketing products under its own brands including Steve Madden®, Dolce Vita®, Betsey Johnson®, Blondo®, Report®, Brian Atwood®, Cejon®, GREATS®, BB Dakota®, Mad Love® and Big Buddha®, Steve Madden is a licensee of various brands, including Anne Klein®, Superga® and DKNY®. Steve Madden also designs and sources products under private label brand names for various retailers. Steve Madden’s wholesale distribution includes department stores, specialty stores, luxury retailers, national chains and mass merchants. Steve Madden also operates 227 retail stores (including eight Internet stores). Steve Madden licenses certain of its brands to third parties for the marketing and sale of certain products, including ready-to-wear, outerwear, eyewear, hosiery, jewelry, fragrance, luggage and bedding and bath products. For local store information and the latest Steve Madden booties, pumps, men’s and women’s boots, fashion sneakers, dress shoes, sandals and more, visit http://www.stevemadden.com.
Safe Harbor Statement Under the U.S. Private Securities Litigation Reform Act of 1995
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Examples of forward-looking statements include, among others, statements regarding revenue and earnings guidance, plans, strategies, objectives, expectations and intentions. Forward-looking statements can be identified by words such as: “may”, “will”, “expect”, “believe”, “should”, “anticipate”, “project”, “predict”, “plan”, “intend”, or “estimate”, and similar expressions or the negative of these expressions. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they represent the Company’s current beliefs, expectations and assumptions regarding anticipated events and trends affecting its business and industry based on information available as of the time such statements are made. Investors are cautioned that such forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which may be outside of the Company’s control. The Company’s actual results and financial condition may differ materially from those indicated in these forward-looking statements. As such, investors should not rely upon them. Important risk factors include:
- the Company’s ability to accurately anticipate fashion trends and promptly respond to consumer demand;
- the Company’s ability to compete effectively in a highly competitive market;
- the Company’s ability to adapt its business model to rapid changes in the retail industry;
- the Company’s dependence on the retention and hiring of key personnel;
- the Company’s ability to successfully implement growth strategies and integrate acquired businesses;
- the Company’s reliance on independent manufacturers to produce and deliver products in a timely manner, especially when faced with adversities such as work stoppages, transportation delays, public health emergencies, social unrest, changes in local economic conditions, and political upheavals as well as meet the Company’s quality standards;
- changes in trade policies and tariffs imposed by the United States government and the governments of other nations in which the Company manufactures and sells products;
- disruptions to product delivery systems and the Company’s ability to properly manage inventory;
- the Company’s ability to adequately protect its trademarks and other intellectual property rights;
- legal, regulatory, political and economic risks that may affect the Company’s sales in international markets;
- changes in U.S. and foreign tax laws that could have an adverse effect on the Company’s financial results;
- additional tax liabilities resulting from audits by various taxing authorities;
- the Company’s ability to achieve operating results that are consistent with prior financial guidance; and
- other risks and uncertainties indicated from time to time in the Company’s filings with the Securities and Exchange Commission.
The Company does not undertake any obligation to publicly update any forward-looking statement, including, without limitation, any guidance regarding revenue or earnings, whether as a result of new information, future developments or otherwise.
STEVEN MADDEN, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS DATA
(In thousands, except per share amounts)
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| (Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||
| Net sales | $ | 414,912 | $ | 410,360 | $ | 1,768,135 | $ | 1,653,609 | ||||||||
| Commission and licensing fee income | 4,713 | 6,485 | 19,022 | 24,125 | ||||||||||||
| Total revenue | 419,625 | 416,845 | 1,787,157 | 1,677,734 | ||||||||||||
| Cost of sales | 261,291 | 258,046 | 1,101,140 | 1,037,571 | ||||||||||||
| Gross profit | 158,334 | 158,799 | 686,017 | 640,163 | ||||||||||||
| Operating expenses | 138,855 | 133,762 | 505,153 | 466,781 | ||||||||||||
| Impairment charges | — | — | 4,050 | — | ||||||||||||
| Income from operations | 19,479 | 25,037 | 176,814 | 173,382 | ||||||||||||
| Interest and other income, net | 998 | 1,456 | 4,412 | 3,958 | ||||||||||||
| Income before provision for income taxes | 20,477 | 26,493 | 181,226 | 177,340 | ||||||||||||
| Provision for income taxes | 3,247 | 13,956 | 39,504 | 46,841 | ||||||||||||
| Net income | 17,230 | 12,537 | 141,722 | 130,499 | ||||||||||||
| Less: net income / (loss) attributable to noncontrolling interest | (521 | ) | 47 | 411 | 1,363 | |||||||||||
| Net income attributable to Steven Madden, Ltd. | $ | 17,751 | $ | 12,490 | $ | 141,311 | $ | 129,136 | ||||||||
| Basic income per share | $ | 0.23 | $ | 0.15 | $ | 1.78 | $ | 1.58 | ||||||||
| Diluted income per share | $ | 0.21 | $ | 0.15 | $ | 1.69 | $ | 1.50 | ||||||||
| Basic weighted average common shares outstanding | 78,754 | 81,151 | 79,577 | 81,664 | ||||||||||||
| Diluted weighted average common shares outstanding | 83,381 | 85,376 | 83,646 | 86,097 | ||||||||||||
| Cash dividends declared per common share | $ | 0.15 | $ | 0.14 | $ | 0.57 | $ | 0.53 | ||||||||
STEVEN MADDEN, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET DATA
(In thousands)
| As of | ||||||||
| December 31, 2019 | December 31, 2018 | |||||||
| (Unaudited) | ||||||||
| Cash and cash equivalents | $ | 264,101 | $ | 200,031 | ||||
| Marketable securities | 40,521 | 66,968 | ||||||
| Accounts receivable, net | 254,637 | 266,452 | ||||||
| Inventories | 136,896 | 137,247 | ||||||
| Other current assets | 22,724 | 32,427 | ||||||
| Property and equipment, net | 65,504 | 64,807 | ||||||
| Operating lease right-of-use assets | 155,700 | — | ||||||
| Goodwill and intangibles, net | 334,058 | 291,423 | ||||||
| Other assets | 4,506 | 13,215 | ||||||
| Total assets | $ | 1,278,647 | $ | 1,072,570 | ||||
| Accounts payable | $ | 61,706 | $ | 79,802 | ||||
| Operating leases (current & non-current) | 171,796 | — | ||||||
| Other current liabilities | 180,941 | 141,887 | ||||||
| Contingent payment liability (current & non-current) | 9,124 | 3,000 | ||||||
| Other long-term liabilities | 13,856 | 33,199 | ||||||
| Total Steven Madden, Ltd. stockholders’ equity | 828,501 | 805,814 | ||||||
| Noncontrolling interest | 12,723 | 8,868 | ||||||
| Total liabilities and stockholders’ equity | $ | 1,278,647 | $ | 1,072,570 | ||||
STEVEN MADDEN, LTD. AND SUBSIDIARIES
CONDENSED CONSOLIDATED CASH FLOW DATA
(In thousands)
| Twelve Months Ended | ||||||||
| December 31, 2019 | December 31, 2018 | |||||||
| (Unaudited) | ||||||||
| Net cash provided by operating activities | $ | 233,780 | $ | 154,376 | ||||
| Investing Activities | ||||||||
| Purchases of property and equipment | (18,311 | ) | (12,450 | ) | ||||
| Sales of marketable securities, net | 27,736 | 23,515 | ||||||
| Acquisitions, net of cash acquired | (37,173 | ) | — | |||||
| Net cash (used in) / provided by investing activities | (27,748 | ) | 11,065 | |||||
| Financing Activities | ||||||||
| Common stock share repurchases for treasury | (101,768 | ) | (105,924 | ) | ||||
| Investment of noncontrolling interest | 3,248 | 2,577 | ||||||
| Distribution of noncontrolling interest earnings | (1,444 | ) | (1,183 | ) | ||||
| Payment of contingent liability | — | (7,000 | ) | |||||
| Proceeds from exercise of stock options | 6,212 | 13,036 | ||||||
| Cash dividends paid | (48,426 | ) | (47,316 | ) | ||||
| Net cash used in financing activities | (142,178 | ) | (145,810 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | 216 | (814 | ) | |||||
| Net increase in cash and cash equivalents | 64,070 | 18,817 | ||||||
| Cash and cash equivalents - beginning of year | 200,031 | 181,214 | ||||||
| Cash and cash equivalents - end of year | $ | 264,101 | $ | 200,031 | ||||
STEVEN MADDEN, LTD. AND SUBSIDIARIES
NON-GAAP RECONCILIATION
(In thousands, except per share amounts)
(Unaudited)
The Company uses non-GAAP financial information to evaluate its operating performance and in order to represent the manner in which the Company conducts and views its business. Additionally, the Company believes the information assists investors in comparing the Company’s performance across reporting periods on a consistent basis by excluding items that are not indicative of its core business. The non-GAAP financial information is provided in addition to, and not as an alternative to, the Company’s reported results prepared in accordance with GAAP.
| Table 1 - Reconciliation of GAAP gross profit to Adjusted gross profit | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP gross profit | $ | 158,334 | $ | 158,799 | $ | 686,017 | $ | 640,163 | ||||||||
| Loss in connection with the termination of a joint venture | 386 | — | 386 | — | ||||||||||||
| Adjusted gross profit | $ | 158,720 | $ | 158,799 | $ | 686,403 | $ | 640,163 | ||||||||
| Table 2 - Reconciliation of GAAP operating expenses to Adjusted operating expenses | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP operating expenses | $ | 138,855 | $ | 133,761 | $ | 505,153 | $ | 466,781 | ||||||||
| Vendor support, net of recovery of bad debt expense, and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcies | (8,946 | ) | (12,123 | ) | (8,687 | ) | (12,123 | ) | ||||||||
| Expense in connection with a provision for legal settlement and related fees | (3,977 | ) | — | (3,977 | ) | (2,837 | ) | |||||||||
| Expense in connection with the termination of a joint venture | (158 | ) | — | (158 | ) | — | ||||||||||
| Expense in connection with the acquisitions of GREATS and BB Dakota | (42 | ) | — | (1,120 | ) | — | ||||||||||
| Expense in connection with a divisional headquarters relocation | — | — | (669 | ) | — | |||||||||||
| Expense in connection with a provision for early lease termination charges and the impairment of lease right-of-use assets | — | (452 | ) | (5,424 | ) | (452 | ) | |||||||||
| Net benefit in connection with the change in a contingent liability and the acceleration of amortization related to the termination of the Kate Spade license agreement | — | — | 1,868 | — | ||||||||||||
| Expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring | — | (278 | ) | — | (2,065 | ) | ||||||||||
| Expense in connection with a warehouse consolidation | — | — | — | (1,241 | ) | |||||||||||
| Adjusted operating expenses | $ | 125,732 | $ | 120,908 | $ | 486,986 | $ | 448,063 | ||||||||
| Table 3 - Reconciliation of GAAP income from operations to Adjusted income from operations | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP income from operations | $ | 19,479 | $ | 25,037 | $ | 176,814 | $ | 173,382 | ||||||||
| Vendor support, net of recovery of bad debt expense, and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcies | 8,946 | 12,123 | 8,687 | 12,123 | ||||||||||||
| Expense in connection with a provision for legal settlement and related fees | 3,977 | — | 3,977 | 2,837 | ||||||||||||
| Loss in connection with the termination of a joint venture | 544 | — | 544 | — | ||||||||||||
| Expense in connection with the acquisitions of GREATS and BB Dakota | 42 | — | 1,120 | — | ||||||||||||
| Expense in connection with a divisional headquarters relocation | — | — | 669 | — | ||||||||||||
| Expense in connection with a provision for early lease termination charges and the impairment of lease right-of-use assets | — | 452 | 5,424 | 452 | ||||||||||||
| Net benefit in connection with the change in a contingent liability and the acceleration of amortization related to the termination of the Kate Spade license agreement | — | — | (1,868 | ) | — | |||||||||||
| Expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring | — | 278 | — | 2,065 | ||||||||||||
| Expense in connection with a warehouse consolidation | — | — | — | 1,241 | ||||||||||||
| Impairment of the Brian Atwood trademark | — | — | 4,050 | — | ||||||||||||
| Adjusted income from operations | $ | 32,988 | $ | 37,890 | $ | 199,417 | $ | 192,100 | ||||||||
| Table 4 - Reconciliation of GAAP provision for income taxes to Adjusted provision for income taxes | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP provision for income taxes | $ | 3,247 | $ | 13,956 | $ | 39,504 | $ | 46,841 | ||||||||
| Tax effect of vendor support, net of recovery of bad debt expense, and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcies | — | 642 | 85 | 642 | ||||||||||||
| Tax effect of expense in connection with a provision for legal settlement and related fees | 961 | — | 961 | 702 | ||||||||||||
| Tax effect of the loss in connection with the termination of a joint venture | 136 | — | 136 | — | ||||||||||||
| Tax effect of expense in connection with the acquisitions of GREATS and BB Dakota | 10 | — | 281 | — | ||||||||||||
| Tax effect of expense in connection with a divisional headquarters relocation | — | — | 168 | — | ||||||||||||
| Tax effect of expense in connection with a provision for early lease termination charges and the impairment of lease right-of-use assets | — | 109 | 1,361 | 109 | ||||||||||||
| Tax effect of the net benefit in connection with the change in a contingent liability and the acceleration of amortization related to the termination of the Kate Spade license agreement | — | — | (469 | ) | — | |||||||||||
| Tax effect of expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring | — | 67 | — | 529 | ||||||||||||
| Tax effect of expense in connection with a warehouse consolidation | — | — | — | 327 | ||||||||||||
| Tax effect in connection with the impairment of the Brian Atwood trademark | — | — | 1,017 | — | ||||||||||||
| Tax expense in connection with the impairment of the preferred interest investment in Brian Atwood Italia Holding, LLC recorded in fourth quarter 2017 | — | — | — | (1,028 | ) | |||||||||||
| Tax expense in connection with deferred tax and other tax adjustments | (2,207 | ) | — | (2,590 | ) | — | ||||||||||
| Tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities audit and prepaid tax adjustment related to prior years | — | (11,136 | ) | — | (11,136 | ) | ||||||||||
| Adjusted provision for income taxes | $ | 2,147 | $ | 3,637 | 40,454 | $ | 36,985 | |||||||||
| Table 5 - Reconciliation of GAAP net income / (loss) attributable to noncontrolling interest to Adjusted net income / (loss) attributable to noncontrolling interest | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP net income / (loss) attributable to noncontrolling interest | $ | (521 | ) | $ | 47 | $ | 411 | $ | 1,363 | |||||||
| Net loss attributable to noncontrolling interest related to the termination of a joint venture | 204 | — | 204 | — | ||||||||||||
| Adjusted net income / (loss) attributable to noncontrolling interest | $ | (317 | ) | $ | 47 | $ | 615 | $ | 1,363 | |||||||
| Table 6 - Reconciliation of GAAP net income attributable to Steve Madden, Ltd. to Adjusted net income attributable to Steve Madden, Ltd. | ||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||
| December 31, 2019 | December 31, 2018 | December 31, 2019 | December 31, 2018 | |||||||||||||
| GAAP net income attributable to Steven Madden, Ltd. | $ | 17,751 | $ | 12,490 | $ | 141,311 | $ | 129,136 | ||||||||
| After-tax impact of vendor support, net of recovery of bad debt expense, and write-off of an unamortized buying agency agreement support payment associated with the Payless ShoeSource bankruptcies | 8,946 | 11,481 | 8,602 | 11,481 | ||||||||||||
| After-tax impact of expense in connection with a provision for legal settlement and related fees | 3,016 | — | 3,016 | 2,135 | ||||||||||||
| After-tax impact of loss in connection with the termination of a joint venture | 204 | — | 204 | — | ||||||||||||
| After-tax impact of expense in connection with the acquisitions of GREATS and BB Dakota | 32 | — | 839 | — | ||||||||||||
| After-tax impact of expense in connection with a divisional headquarters relocation | — | — | 501 | — | ||||||||||||
| After-tax impact of expense in connection with early lease termination charges and the impairment of lease right-of-use assets | — | 343 | 4,063 | 343 | ||||||||||||
| After-tax impact of the net benefit in connection with the change in a contingent liability and the acceleration of amortization related to the termination of the Kate Spade license agreement | — | — | (1,399 | ) | — | |||||||||||
| After-tax impact of expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring | — | 211 | — | 1,536 | ||||||||||||
| After-tax impact of expense in connection with a warehouse consolidation | — | — | — | 914 | ||||||||||||
| After-tax impact associated with the impairment related to the Brian Atwood trademark | — | — | 3,033 | — | ||||||||||||
| Tax expense in connection with the impairment of the preferred interest investment in Brian Atwood Italia Holding, LLC recorded in fourth quarter 2017 | — | — | — | 1,028 | ||||||||||||
| Tax expense in connection with deferred tax and other tax adjustments | 2,207 | — | 2,590 | — | ||||||||||||
| Tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities audit and prepaid tax adjustment related to prior years | — | 11,136 | — | 11,136 | ||||||||||||
| Adjusted net income attributable to Steven Madden, Ltd. | $ | 32,156 | $ | 35,661 | $ | 162,760 | $ | 157,710 | ||||||||
| GAAP diluted income per share | $ | 0.21 | $ | 0.15 | $ | 1.69 | $ | 1.50 | ||||||||
| Adjusted diluted income per share | $ | 0.39 | $ | 0.42 | $ | 1.95 | $ | 1.83 | ||||||||
Contact
Steven Madden, Ltd.
Director of Corporate Development & Investor Relations
Danielle McCoy
718-308-2611
[email protected]