Shares of Skechers (NYSE:SKX), a maker of lifestyle an athletic footwear and apparel, are trading 16% higher as of 11 a.m. EST Friday after the company reported solid fourth-quarter results thanks to strong international sales.
Skechers posted record fourth-quarter sales of $1.08 billion, an 11.4% increase over the prior-year period but just below analysts' estimates calling for $1.1 billion. The bottom-line result, however, was enough to please investors. Skechers' earnings per share checked in at $0.31, well above the prior year's $0.43-per-share loss and better than analysts' estimates calling for earnings of $0.23 per share.
"2018 was a year of record sales -- our first fourth quarter of over a billion dollars and, combined with three previous record quarters, a new annual sales record of $4.64 billion," stated David Weinberg, chief operating officer of Skechers, in a press release. Further, international wholesale sales increased 18.4% and company-owned global retail sales increased 7.5%. The icing on the cake for investors was management's first-quarter guidance for earnings between $0.70 and $0.75 per share, which exceeded analysts' expectations of $0.63 per share.
Check out the latest earnings call transcript for Skechers.
Skechers' international business is still at the core of its growth story. That's the driving force behind management decision to transition its India joint venture to a wholly owned subsidiary and its agreement to establish a joint venture in Mexico. Those two moves are expected to be accretive to earnings in 2019. Skechers is also focused on expanding its global e-commerce business by improving the functionality of its websites in the U.S. and China, as well as launching a platform in India. If Skechers can focus on international sales to boost its top line and continue to expand its e-commerce business, 2019 has the potential to be a strong year for investors.