US' footwear firm Wolverine Worldwide's gross margin at 38.9% in FY23

Revenue for FY23 stood at $2,242.9 million, representing a decline of 16.5 per cent from the previous year, and a 16.3 per cent decline on a constant currency basis. The company attributed this decrease to various market pressures and strategic decisions aimed at stabilising the business.

Selling, general and administrative expenses were reported at $940.7 million, equating to 41.9 per cent of revenue. However, adjusted selling, general and administrative expenses were $797.7 million, or 36.3 per cent of adjusted revenue, indicating a 250 basis point increase from the prior year.

In the fourth quarter of fiscal 2023 (Q4 FY23), revenue dropped to $526.7 million, a 20.8 per cent decrease from the previous year, with a 21.3 per cent decline on a constant currency basis. Ongoing business revenue also fell to $521.2 million, reflecting an 18.4 per cent decline on a constant currency basis.

The company's international revenue was $267.2 million, down 5.1 per cent from the prior year, with ongoing business international revenue decreasing by 3.4 per cent. Direct-to-consumer (DTC) revenue saw a 17.6 per cent decrease to $186.9 million, with ongoing business DTC revenue down 15.5 per cent.

However, Wolverine Worldwide saw an improvement in gross margin during Q4 FY23, reporting 36.6 per cent compared to 33.7 per cent in the prior year. Selling, general and administrative expenses for the quarter were $379.9 million, representing 72.1 per cent of revenue.

A significant achievement for the company was the reduction in inventory levels. At the end of Q4 FY23, inventory was down to $373.6 million, a reduction of approximately 50 per cent compared to the prior year.

“We are effectively executing our transformation plan with great pace – having largely completed the stabilisation phase of our turnaround,” said Chris Hufnagel, president and chief executive officer of Wolverine Worldwide. “We finished the year with revenue and earnings in-line with guidance, and inventory and debt levels better than expected. Most importantly, Wolverine Worldwide is a much different company than it was just six months ago, with a healthier balance sheet, enhanced efficiency to deliver higher profit and investment, and a redesigned organisational structure to strengthen our brand-building capabilities.”

Fibre2Fashion News Desk (DP)