SHOO
$33.52
Steven Maddens
($.10)
(.30%)
Earnings Details
4th Quarter December 2018
Wednesday, February 27, 2019 6:59:00 AM
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Summary

Steven Madden Guides Earnings Below Estimates

Steven Maddens (SHOO) reported 4th Quarter December 2018 earnings of $0.42 per share on revenue of $410.4 million. The consensus earnings estimate was $0.38 per share on revenue of $400.6 million. Revenue grew 12.6% on a year-over-year basis.

The company said it expects 2019 earnings of $1.75 to $1.83 per share on revenue of $1.72 billion to $1.75 billion. The current consensus earnings estimate is $1.89 per share on revenue of $1.74 billion for the year ending December 31, 2019.

Steven Madden Ltd designs, markets and sells fashion-forward name brand and private label footwear for women, men and children and name brand and private label fashion handbags and accessories.

Results
Reported Earnings
$0.42
Earnings Whisper
-
Consensus Estimate
$0.38
Reported Revenue
$410.4 Mil
Revenue Estimate
$400.6 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Steve Madden Announces Fourth Quarter and Full Year 2018 Results and Provides Initial Fiscal Year 2019 Sales and EPS Guidance

LONG ISLAND CITY, N.Y., Feb. 27, 2019 (GLOBE NEWSWIRE) -- Steve Madden (Nasdaq: SHOO), a leading designer and marketer of fashion footwear and accessories for women, men and children, today announced financial results for the fourth quarter and full year ended December 31, 2018, and provided initial fiscal year 2019 sales and EPS guidance.

Amounts referred to as “Adjusted” exclude the items that are described under the heading “Non-GAAP Adjustments.”

For the Fourth Quarter 2018:

  • Net sales increased 12.6% to $410.4 million compared to $364.4 million in the same period of 2017.
  • Gross margin was 37.1%.  Gross margin in the fourth quarter of 2017 was 38.4%.  Adjusted gross margin in the fourth quarter of 2017 was 38.1%.
  • Operating expenses as a percentage of net sales were 29.7% compared to 30.3% of net sales, in the same period of 2017.  Adjusted operating expenses as a percentage of net sales were 28.6% compared to 29.0% of net sales, in the same period of 2017.
  • Income from operations totaled $25.0 million, or 6.1% of net sales, compared to $31.7 million, or 8.7% of net sales, in the same period of 2017.  Adjusted income from operations was $37.9 million, or 9.2% of net sales, compared to Adjusted income from operations of $36.3 million, or 10.0% of net sales, in the same period of 2017.
  • Net income attributable to Steven Madden, Ltd. was $12.5 million, or $0.15 per diluted share, compared to $24.6 million, or $0.28 per diluted share, in the prior year's fourth quarter.  Adjusted net income attributable to Steven Madden, Ltd. was $35.7 million, or $0.42 per diluted share, compared to $27.5 million, or $0.32 per diluted share, in the prior year's fourth quarter.

Edward Rosenfeld, Chairman and Chief Executive Officer, commented, “We are pleased to have delivered a strong fourth quarter, with net sales growing 13% and Adjusted diluted EPS increasing 31% compared to the prior year period.  The trend-right product assortments created by Steve and his design team drove robust gains in our flagship Steve Madden brand in both footwear and handbags.  We also saw outstanding growth in Blondo and in our private label accessories business.  As we look ahead, we are encouraged by the strong momentum in our core business and the progress we are making on our key strategic initiatives.  While we face a near-term headwind due to the bankruptcy of Payless ShoeSource, a significant private label customer for the Company, we are confident that our diversified business model positions us for long-term growth and value creation going forward.”

Fourth Quarter 2018 Segment Results

Net sales for the wholesale business increased 14.1% to $317.4 million in the fourth quarter of 2018, driven by strong growth in both wholesale footwear and wholesale accessories.  Gross margin in the wholesale business decreased to 30.1% compared to 31.0% in last year’s fourth quarter due to a decline in wholesale accessories driven by sales mix, as well as the impact of the 10% tariff on handbags and certain other accessory categories implemented on September 24, 2018 and increased ocean freight costs.

Retail net sales in the fourth quarter rose 7.9% to $93.0 million compared to $86.2 million in the fourth quarter of the prior year.  Same store sales increased 4.0% in the quarter driven by strong performance in the Company’s e-commerce business.  Retail gross margin rose to 61.0% in the fourth quarter of 2018, up 20 basis points compared to 60.8% in the fourth quarter of the prior year due to improved gross margin in the Company’s e-commerce business.

The Company ended the quarter with 229 company-operated retail locations, including seven Internet stores, as well as 42 company-operated concessions in international markets.

The Company’s effective tax rate for the fourth quarter of 2018 was 52.7% compared to 23.2% in the fourth quarter of 2017 driven by $11.1 million in tax expense resulting from the Tax Cuts and Jobs Act transition tax and prepaid tax adjustments related to prior years.  On an Adjusted basis, the effective tax rate was 9.2% compared to 24.9% in the fourth quarter of the prior year due primarily to the impact of the Tax Cuts and Jobs Act.

Full Year Ended December 31, 2018

For the full year ended December 31, 2018, net sales increased 7.0% to $1.65 billion from $1.55 billion in the prior year.

Net income was $129.1 million, or $1.50 per diluted share, for the year ended December 31, 2018 compared to net income of $117.9 million, or $1.36 per diluted share, for the year ended December 31, 2017.  On an Adjusted basis, net income was $157.7 million, or $1.83 per diluted share, for the year ended December 31, 2018 compared to net income of $129.3 million, or $1.49 per diluted share, for the year ended December 31, 2017.

Balance Sheet and Cash Flow

During the fourth quarter of 2018, the Company repurchased 1.8 million shares of the Company’s common stock for approximately $55.0 million, which includes shares acquired through the net settlement of employee stock awards.  For the full year ended December 31, 2018, the Company repurchased 3.4 million shares of the Company’s common stock for approximately $105.9 million, which includes shares acquired through the net settlement of employee stock awards. 

As of December 31, 2018, cash, cash equivalents, and current marketable securities totaled $267.0 million.

Quarterly Dividend

The Company’s Board of Directors approved a quarterly cash dividend of $0.14 per share.  The dividend will be paid on March 29, 2019, to stockholders of record at the close of business on March 19, 2019.

Fiscal Year 2019 Outlook

For fiscal year 2019, the Company expects net sales will increase 4% to 6% over net sales in 2018.  The Company expects diluted EPS for fiscal year 2019 will be in the range of $1.70 to $1.78.  The Company expects Adjusted diluted EPS for fiscal year 2019 will be in the range of $1.75 to $1.83. Compared to the prior year, the Adjusted diluted EPS range reflects an adverse impact of approximately $0.16 from the Payless ShoeSource bankruptcy as well as an adverse impact of approximately $0.05 from a higher forecasted tax rate.

Non-GAAP Adjustments

Amounts referred to as “Adjusted” exclude the items below.

For the fourth quarter 2018:

  • $8.5 million pre-tax ($7.9 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 licensing and commission income, net and $3.6 million pre-tax ($3.6 million after-tax) in bad debt expense 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 fourth quarter 2017:

  • $1.1 million pre-tax ($0.7 million after-tax) non-cash benefit associated with the purchase accounting fair value adjustment of inventory acquired in the Schwartz & Benjamin acquisition, included in cost of sales. 
  • $11.8 million pre-tax ($7.5 million after-tax) expense in connection with a provision for legal and early lease termination charges, included in operating expenses.
  • $10.2 million pre-tax ($6.4 million after-tax) benefit in connection with a post-closing amendment to the equity purchase agreement relating to the Schwartz & Benjamin acquisition, included in operating expenses.
  • $2.4 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.
  • $2.7 million pre-tax ($1.7 million after-tax) non-cash expense associated with the impairment of the preferred interest investment in Brian Atwood Italia Holding LLC, included in operating expenses.
  • $2.0 million pre-tax ($1.7 million after-tax) benefit related to an adjustment to estimated bad debt expense associated with the Payless ShoeSource bankruptcy, included in operating expenses.
  • $1.0 million pre-tax ($0.6 million after-tax) non-cash expense associated with the impairment of the Wild Pair trademark.
  • $0.5 million tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities audit adjustments.

For the fiscal year 2018:

  • $8.5 million pre-tax ($7.9 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 licensing and commission income, net and $3.6 million pre-tax ($3.6 million after-tax) in bad debt expense associated with the Payless ShoeSource bankruptcy, included in operating expenses.
  • $3.3 million pre-tax ($2.5 million after-tax) expense in connection with a provision for legal charges and early lease termination charges, 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.
  • $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 2017:

  • $0.6 million pre-tax ($0.4 million after-tax) non-cash expense associated with the purchase accounting fair value adjustment of inventory acquired in the Schwartz & Benjamin acquisition, included in cost of sales. 
  • $11.8 million pre-tax ($7.5 million after-tax) expense in connection with a provision for legal and early lease termination charges, included in operating expenses.
  • $10.2 million pre-tax ($6.4 million after-tax) benefit in connection with a post-closing amendment to the equity purchase agreement relating to the Schwartz & Benjamin acquisition, included in operating expenses.
  • $3.6 million pre-tax ($2.3 million after-tax) expense in connection with the integration of the Schwartz & Benjamin acquisition and the related restructuring, included in operating expenses.
  • $2.7 million pre-tax ($1.7 million after-tax) non-cash expense associated with the impairment of the preferred interest investment in Brian Atwood Italia Holding LLC, included in operating expenses.
  • $5.5 million pre-tax ($4.8 million after-tax) bad debt expense associated with the Payless ShoeSource bankruptcy, included in operating expenses.
  • $1.0 million pre-tax ($0.6 million after-tax) non-cash expense associated with the impairment of the Wild Pair trademark.
  • $0.5 million tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities audit adjustments.

For the fiscal year 2019:

  • $2.1 million pre-tax ($1.9 million after-tax) in estimated bad debt expense associated with the Payless ShoeSource bankruptcy.
  • $2.0 million pre-tax ($1.5 million after-tax) in expense expected to be incurred in connection with early lease termination charges.
  • $0.6 million pre-tax ($0.4 million after-tax) in expense expected to be incurred in connection with an office consolidation.

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 earnings conference call scheduled for today, February 27, 2019, at 8:30 a.m. Eastern Time.  The call will be broadcast live over the Internet and can be accessed by logging onto http://www.stevemadden.gcs-web.com.  An online archive of the broadcast will be available within one hour 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 and accessories 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®, Mad Love® and Big Buddha®, Steve Madden is a licensee of various brands, including Kate Spade®, Superga®, Anne Klein® 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 229 retail stores (including Steve Madden's seven 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

This press release and oral statements made from time to time by representatives of the Company contain certain “forward looking statements” as that term is defined in the federal securities laws. The events described in forward looking statements may not occur. Generally, these statements relate to business plans or strategies, projected or anticipated benefits or other consequences of the Company's plans or strategies, projected or anticipated benefits from acquisitions to be made by the Company, or projections involving anticipated revenues, earnings or other aspects of the Company's operating results. The words "may," "will," "expect," "believe," "anticipate," "project," "plan," "intend," "estimate," and "continue," and their opposites and similar expressions are intended to identify forward looking statements. The Company cautions you that these statements concern current expectations about the Company’s future results and condition and are not guarantees of future performance or events and are subject to a number of uncertainties, risks and other influences, many of which are beyond the Company's control, that may influence the accuracy of the statements and the projections upon which the statements are based. Factors which may affect the Company's results include, but are not limited to, the risks and uncertainties discussed in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the Securities and Exchange Commission. Any one or more of these uncertainties, risks and other influences could materially affect the Company's results of operations and financial condition and whether forward looking statements made by the Company ultimately prove to be accurate and, as such, the Company's actual results, performance and achievements could differ materially from those expressed or implied in these forward looking statements. The Company undertakes no obligation to publicly update or revise any forward looking statements, whether as a result of new information, future events or otherwise.


           
 STEVEN MADDEN, LTD. AND SUBSIDIARIES    
 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS DATA    
 (In thousands, except per share amounts)    
      
  Three Months Ended Twelve Months Ended  
  December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017  
  (Unaudited) (Unaudited) (Unaudited)    
           
 Net sales$  410,360  $  364,370 $  1,653,609 $  1,546,098  
 Cost of sales   258,046     224,634    1,037,571    968,357  
 Gross profit   152,314     139,736    616,038    577,741  
 Commission and licensing fee (loss)/income, net   (5,480)    3,421    5,417    14,259  
 Operating expenses   121,797     110,490    448,073    421,216  
 Impairment charge   -     1,000    -    1,000  
 Income from operations   25,037     31,667    173,382    169,784  
 Interest and other income, net   1,456     587    3,958    2,543  
 Income before provision for income taxes   26,493     32,254    177,340    172,327  
 Provision for income taxes   13,956     7,486    46,841    53,189  
 Net income   12,537     24,768    130,499    119,138  
 Less: Net income attributable to noncontrolling interest   47     171    1,363    1,190  
 Net income attributable to Steven Madden, Ltd.$  12,490  $  24,597 $  129,136 $  117,948  
           
           
 Basic income per share$  0.15  $  0.30 $  1.58 $  1.43  
 Diluted income per share$  0.15  $  0.28 $  1.50 $  1.36  
           
 Basic weighted average common shares          
 outstanding   81,151     82,139    81,664    82,736  
 Diluted weighted average common shares          
 outstanding   85,376     86,462    86,097    86,745  
           


    
 STEVEN MADDEN, LTD. AND SUBSIDIARIES  
 CONDENSED CONSOLIDATED BALANCE SHEET DATA  
 (In thousands)  
  As of    
  December 31, 2018 December 31, 2017  
  (Unaudited)    
 Cash and cash equivalents$  200,031 $  181,214  
 Marketable securities   66,968    93,550  
 Accounts receivable, net   266,452    240,909  
 Inventories   137,247    110,324  
 Other current assets   32,427    49,044  
 Property and equipment, net   64,807    71,498  
 Goodwill and intangibles, net   291,423    299,842  
 Other assets   13,215    10,780  
 Total assets$  1,072,570 $  1,057,161  
       
 Accounts payable$  79,802 $  66,955  
 Contingent payment liability (current & non current)   3,000    10,000  
 Other current liabilities   141,887    132,657  
 Other long term liabilities   33,199    38,617  
 Total Steven Madden, Ltd. stockholders' equity   805,814    802,821  
 Noncontrolling interest   8,868    6,111  
 Total liabilities and stockholders' equity$  1,072,570 $  1,057,161  
       

 

         
 STEVEN MADDEN, LTD. AND SUBSIDIARIES  
 CONDENSED CONSOLIDATED CASH FLOW DATA  
 (In thousands)  
    
    Twelve Months Ended  
    December 31, 2018 December 31, 2017  
    (Unaudited)    
         
         
 Net cash provided by operating activities  $  154,376  $  157,935   
         
 Investing Activities       
 Purchases of property and equipment     (12,450)    (14,775)  
 Sales of marketable securities, net     23,515     17,932   
 Proceeds from notes receivable     -     221   
 Acquisition, net of cash acquired     -     (16,795)  
 Net cash provided by/(used in) investing activities     11,065     (13,417)  
         
 Financing Activities       
 Common stock purchased for treasury     (105,924)    (99,412)  
 Investment of noncontrolling interest     2,577     -   
 Distribution of noncontrolling interests earnings     (1,183)    -   
 Payment of contingent liability     (7,000)    (7,359)  
 Proceeds from exercise of stock options     13,036     16,433   
 Cash dividends paid     (47,316)    -   
 Net cash (used in) financing activities     (145,810)    (90,338)  
         
 Effect of exchange rate changes on cash and cash equivalents    (814)    919   
         
 Net increase in cash and cash equivalents     18,817     55,099   
         
 Cash and cash equivalents - beginning of year     181,214     126,115   
         
 Cash and cash equivalents - end of year  $  200,031  $  181,214   
         
         

 

               
 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, 2017   December 31, 2017    
 Consolidated             
 GAAP gross profit    $  139,736    $  577,741     
               
 Non-cash (benefit)/expense associated with the purchase accounting fair value            
 adjustment of inventory acquired in the Schwartz & Benjamin acquisition      (1,060)      591     
               
 Adjusted gross profit    $  138,676    $  578,332     
               
 Wholesale             
 GAAP gross profit    $  87,379    $  413,096     
               
 Non-cash (benefit)/expense associated with the purchase accounting fair value            
 adjustment of inventory acquired in the Schwartz & Benjamin acquisition      (1,060)      591     
               
 Adjusted gross profit    $  86,319    $  413,687     
               
 Table 2 - Reconciliation of GAAP licensing and commission income, net to Adjusted licensing and commission income, net        
    Three Months Ended   Twelve Months Ended      
    December 31, 2018   December 31, 2018      
 Consolidated             
 GAAP licensing and commission (loss)/income, net  $  (5,480)   $  5,417       
               
 Bad debt expense and write-off of an unamortized buying agency agreement support            
 payment associated with the Payless ShoeSource bankruptcy    8,507       8,507       
               
 Adjusted licensing and commission income, net  $  3,026    $  13,924       
               
 Table 3 - Reconciliation of GAAP operating expenses to Adjusted operating expenses           
    Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended    
    December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017    
               
 GAAP operating expenses  $  121,797  $  110,490  $  448,073  $  421,216     
               
 Expense in connection with provision for legal and early lease            
 termination charges     (452)    (11,836)  (3,289)    (11,836)    
               
 Benefit in connection with post-closing amendment to the equity purchase             
 agreement relating to the Schwartz & Benjamin acquisition     -     10,215     -     10,215     
               
 Expense in connection with the integration of the Schwartz & Benjamin            
 acquisition and the related restructuring     (278)    (2,384)  (2,065)    (3,639)    
               
 Expense in connection with a warehouse consolidation     -    -    (1,241)   -      
               
 Impairment of preferred interest investment in Brian Atwood Italia Holding LLC    -     (2,700)    -     (2,700)    
               
 Bad debt expense/(benefit) associated with the Payless ShoeSource bankruptcies $  (3,616) $  2,030  $  (3,616) $  (5,470)    
               
 Adjusted operating expenses  $  117,451  $  105,815  $  437,862  $  407,786     
               
 Table 4 - Reconciliation of GAAP income from operations to Adjusted income from operations          
    Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended    
    December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017    
               
 GAAP Income from operations  $  25,037  $  31,667  $  173,382  $  169,784     
               
 Non-cash (benefit) expense associated with the purchase accounting fair value            
 adjustment of inventory acquired in the Schwartz & Benjamin acquisition    -     (1,060)    -     591     
               
 Expense in connection with provision for legal and early lease            
 termination charges     452     11,836   3,289     11,836     
               
 Benefit in connection with post-closing amendment to the equity purchase             
 agreement relating to the Schwartz & Benjamin acquisition     -     (10,215)    -     (10,215)    
               
 Expense in connection with the integration of the Schwartz & Benjamin            
 acquisition and the related restructuring     278     2,384   2,065     3,639     
               
 Expense in connection with a warehouse consolidation     -    -    1,241    -      
               
 Impairment of preferred interest investment in Brian Atwood Italia Holding LLC    -     2,700     -     2,700     
               
 Bad debt expense/(benefit) and write-off of an unamortized buying agency agreement            
 support payment associated with the Payless ShoeSource bankruptcies    12,123     (2,030)    12,123     5,470     
               
 Impairment of Wild Pair trademark $  -  $  1,000  $  -  $  1,000     
               
 Adjusted Income from operations  $  37,890  $  36,282  $  192,100  $  184,805     
               
 Table 5 - Reconciliation of GAAP provision for income taxes to Adjusted provision for income taxes          
    Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended    
    December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017    
               
 GAAP provision for income taxes  $  13,956  $  7,486  $  46,841  $  53,189     
               
 Tax effect of non-cash (benefit)/expense associated with the purchase             
 accounting fair value adjustment of inventory acquired in the Schwartz &             
 Benjamin acquisition    -     (390)    -     189     
               
 Tax effect of expense in connection with provision for legal and early lease            
 termination charges     109     4,379     811     4,379     
               
 Tax effect of expense in connection with post-closing amendment to the equity            
 purchase agreement relating to the Schwartz & Benjamin acquisition    -     (3,780)    -     (3,780)    
               
 Tax effect of expense in connection with the integration of the Schwartz &            
 Benjamin acquisition and the related restructuring     67     882     529     1,346     
               
 Tax effect of expense in connection with a warehouse consolidation    -    -      327    -      
               
 Tax expense/(benefit) in connection with the impairment of the preferred interest            
 investment in Brian Atwood Italia Holding, LLC      -     999     (1,028)    999     
               
 Tax effect of bad debt expense/(benefit) and write-off of an unamortized buying agency            
 agreement support payment associated with the Payless ShoeSource bankruptcies    642     (293)    642     671     
               
 Tax effect of impairment of Wild Pair trademark     -     370     -     370     
               
 Tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities          
 audit and prepaid tax adjustments related to prior years  $  (11,136) $  (463) $  (11,136) $  (463)    
               
 Adjusted provision for income taxes  $  3,637  $  9,191  $  36,985  $  56,901     
               
 Table 6 - Reconciliation of GAAP net income to Adjusted net income            
    Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended    
    December 31, 2018 December 31, 2017 December 31, 2018 December 31, 2017    
               
 GAAP net income attributable to Steven Madden, Ltd.  $  12,490  $  24,597  $  129,136  $  117,948     
               
 After-tax impact of non-cash (benefit)/expense associated with the purchase            
 accounting fair value adjustment of inventory acquired in the Schwartz &            
 Benjamin acquisition    -     (670)    -     402     
               
 After-tax impact of expense in connection with provision for legal and early lease            
 termination charges      343     7,457     2,478     7,457     
               
 After-tax impact of benefit in connection with post-closing amendment to the equity            
 purchase agreement relating to the Schwartz & Benjamin acquisition    -     (6,435)    -     (6,435)    
               
 After-tax impact of expense in connection with the integration of the Schwartz &            
 Benjamin acquisition and the related restructuring     211     1,502     1,536     2,293     
               
 After-tax impact of expense in connection with a warehouse consolidation    -    -      914    -      
               
 After-tax impact of impairment preferred interest in Brian Atwood            
 Italia Holding, LLC      -     1,701     1,028     1,701     
               
 After-tax impact of bad debt expense/(benefit) and write-off of an unamortized buying            
 agency support payment agreement associated with the Payless ShoeSource            
 bankruptcies    11,481     (1,737)  11,481     4,799     
               
 After-tax impact of impairment of Wild Pair trademark     -     630     -     630     
               
 Tax expense resulting from the Tax Cuts and Jobs Act transition tax and taxing authorities           
 audit and prepaid tax adjustments related to prior years  $  11,136  $  463  $  11,136  $  463     
               
 Adjusted net income attributable to Steven Madden, Ltd.  $  35,661  $  27,507  $  157,710  $  129,257     
               
 GAAP diluted income per share  $  0.15  $  0.28  $  1.50  $  1.36     
 Adjusted diluted income per share  $  0.42  $  0.32  $  1.83  $  1.49     
               

 

Contact

Steven Madden, Ltd.
Director of Corporate Development & Investor Relations
Danielle McCoy
718-308-2611
InvestorRelations@stevemadden.com

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Source: Steve Madde