UGG Parent Company'S Annual Sales Increased By 6.2% For The First Time Into The 2 Billion Dollar Club.

Deckers group, which has abandoned the sale of UGG, is recovering its lost market share through multi brand strategy.

In the 12 months ended March 31st, the sales of Deckers group of Ugg parent company increased by 6.2% to 2 billion 90 million US dollars compared with the same period last year. For the first time, it entered the club of 2 billion dollars, gross profit margin increased to 51.6%, net profit rose 133% to 264 million dollars, compared with a loss of 1 million 900 thousand dollars in the same period last year.

During the period, the sales volume of the group rose from 9.9% to 1 billion 305 million US dollars in wholesale channels, while sales in direct retail outlets fell 0.1% to 715 million US dollars. Sales in the North American market increased 8.9% to 1 billion 278 million US dollars, and sales in the international market, including China, increased by 1.8% to 742 million 100 thousand yuan.

Deckers group, founded in 1973, is headquartered in Goleta, California, USA. It mainly designed and sold outdoor sports shoes, clothing and accessories. In 1995, it acquired UGG known for its snow boots. In 2002, it bought the high-end footwear brand Teva patents, trademarks and other assets.

Since 2011, the group has begun to accelerate its pace of expansion. After acquiring the Sanuk of its leisure shoes brand, it won the running shoes brand Hoka One One in 2012, and bought Koolaburra in 2015.

It is noteworthy that the growth momentum of Deckers group's performance in the 2019 fiscal year mainly comes from Hoka One One and Koolaburra, rather than the core brand UGG.

Hoka One One sales rose 45.4% to $223 million last year, which has recorded strong double-digit growth for two consecutive quarters, and Koolaburra revenue has doubled to 44 million US dollars.

Affected by warm winter weather, UGG's fourth quarter sales plunged 7.2% to 239 million US dollars. The annual revenue increased by only 1.7% to 1 billion 533 million dollars. Teva brand annual sales rose 2.9% to 137 million dollars, a record high, while Sanuk sales fell 9.1% to 82 million 600 thousand dollars.

Group CEO Dave Powers, in a conference call after the earnings report, stressed that under the impetus of effective pformation measures, the Deckers group not only had a profit margin of far more than 13% of the previous set, but also entered a $2 billion club a year ahead of schedule.

For Deckers group's latest rising dark horse, Dave Powers believes that the growth of Hoka One One results from the brand awareness in the minds of consumers.

The brand was founded in 2009 by French off-road athletes Nicolas Mermoud and Jean-Loc Diard. With its lightweight and stable professional running shoes and Nicolas Mermoud personally testing and winning the championship repeatedly, the brand quickly became popular.

In 2013, more than 350 dealers scrambled to sell Hoka One One running shoes.

In the global market, the demand for professional sports shoes is getting stronger and stronger. The Hoka One One, which was acquired by Deckers group, has expanded rapidly. Not only classic products such as Bondi, Clifton, Arahi and Gaviota Styles have been warmly welcomed by consumers, but the brand new Sky Collection launched in March also received positive feedback from the market.

In May 1st, Hoka One One also introduced carbon fiber ultra light running shoes Carbon X series, and invited athletes Jim Walmsley to participate in a long distance speed challenge, and finally broke the world record of 50 miles long distance in 4 hours, 50 minutes and 08 seconds.

It is learnt that the Hoka One One team will continue to focus on product diversification, aiming at attracting new consumers while meeting the needs of loyal consumers.

At the same time, Deckers group is optimistic about the development potential of Hoka One One in the international market, and will further expand the market share of the brand in the Asia Pacific region in the future.

According to European statistics, the global market for sports shoes will increase from $134 billion 310 million last year to US $146 billion 90 million this year, and it is expected to reach US $158 billion 950 million by 2020.

When it comes to the UGG brand with the largest share, the group emphasizes that the sales volume of men's and women's clothing products has increased over the past year, and new products such as Fluff Yeah, Tasman and so on are especially popular among young consumers. UGG

According to Google trend report, consumer interest in UGG brand has increased by 7% in the past year.

In September 2017, UGG announced that Chinese actress Angela Baby Angelababy, who has 100 million fans in micro-blog, is the spokesperson for its brand. Last year, both sides jointly released a series of cooperation products.

In fact, UGG products are generally at the two extreme in the eyes of consumers. Many consumers like it very much, and some consumers have vowed never to wear them. The design of their products is too single.

In order to weaken the influence of weather factors on brand sales, UGG team, like the luxury feather brands like Canada Goose and Moncler, has been committed to developing more fashionable spring and summer products in recent years, and has released cooperative series with Sacai, Y/Project and other designer brands, and even landed at Paris Fashion Week show to enhance their fashion DNA as much as possible.

Dave Power and group chief financial officer Steve Fasching said at the meeting that UGG will rely on creative marketing, upgrading product personalization and accelerating the layout of online markets to establish a more stable relationship with new and old consumers.

Group lifestyle brand director Andrea O 'Donnell responded that it would relocate its products in the future to gain more opportunities for overseas expansion.

On the other hand, according to the fashion business news, Deckers group has jointly written with more than 170 sports shoes brands such as Nike and Adidas to request us president Trump to give up 25% duty on shoes imported from China.

For the 2020 fiscal year, the Deckers group is cautiously optimistic, with annual sales expected to be between $2 billion 95 million and $2 billion 120 million, an increase of 4% to 5% over the previous year and a gross margin of about 50.1%.

In view of the over completion of the cost saving plan, the Group intends to invest some of its funds in new businesses and expand its brand matrix.

As of Friday's close, Deckers shares rose 4.1% to $153.46, up 18% this year and about 4 billion 600 million US dollars.