Steven Madden(SHOO) - 2021 Q2 - Quarterly Report

PART I – FINANCIAL INFORMATION ITEM 1. Condensed Consolidated Financial Statements (Unaudited) Presents unaudited condensed consolidated financial statements and notes, detailing financial position, performance, and cash flows Condensed Consolidated Balance Sheets Key Balance Sheet Data (in thousands) | Metric | June 30, 2021 | December 31, 2020 | June 30, 2020 | | :-------------------------------- | :------------ | :---------------- | :------------ | | ASSETS | | | | | Cash and cash equivalents | $262,144 | $247,864 | $318,101 | | Total current assets | $743,780 | $698,241 | $635,921 | | Total Assets | $1,173,143 | $1,137,761 | $1,132,392 | | LIABILITIES | | | | | Total current liabilities | $279,158 | $235,916 | $237,892 | | Total Liabilities | $390,621 | $347,392 | $365,272 | | STOCKHOLDERS' EQUITY | | | | | Total stockholders' equity | $782,522 | $790,369 | $767,120 | - Total assets increased by $35,382 thousand from December 31, 2020, to June 30, 2021, reaching $1,173,143 thousand[8] - Total liabilities increased by $43,229 thousand from December 31, 2020, to June 30, 2021, reaching $390,621 thousand[8] Condensed Consolidated Statements of Income/(Loss) Key Income Statement Data (in thousands, except per share data) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :------------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total revenue | $397,894 | $142,812 | $758,919 | $501,980 | | Gross profit | $170,055 | $55,888 | $309,159 | $189,352 | | Income/(loss) from operations | $47,718 | $(23,702) | $75,762 | $(49,950) | | Net income/(loss) attributable to Steven Madden, Ltd. | $36,852 | $(16,586) | $58,049 | $(34,037) | | Diluted net income/(loss) per share | $0.45 | $(0.21) | $0.71 | $(0.43) | | Cash dividends declared per common share | $0.15 | $— | $0.30 | $0.15 | - Total revenue for the three months ended June 30, 2021, increased by 178.6% to $397,894 thousand compared to the same period last year, and for the six months, it increased by 51.2% to $758,919 thousand[9] - The company reported a net income of $36,852 thousand for the three months ended June 30, 2021, a significant improvement from a net loss of $(16,586) thousand in the prior-year period[9] Condensed Consolidated Statements of Comprehensive Income/(Loss) Comprehensive Income/(Loss) (in thousands) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :-------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income/(loss) | $37,341 | $(17,144) | $59,672 | $(34,945) | | Total other comprehensive income/(loss) | $3,870 | $5,213 | $4,400 | $(9,250) | | Comprehensive income/(loss) | $41,211 | $(11,931) | $63,863 | $(44,195) | | Comprehensive income/(loss) attributable to Steven Madden, Ltd. | $40,300 | $(11,191) | $62,132 | $(43,447) | - Comprehensive income attributable to Steven Madden, Ltd. for the three months ended June 30, 2021, was $40,300 thousand, a substantial increase from a loss of $(11,191) thousand in the prior-year period[10] Condensed Consolidated Statements of Changes in Stockholders' Equity Changes in Stockholders' Equity (in thousands) | Metric | Balance at December 31, 2020 | Balance at June 30, 2021 | | :------------------------------------ | :--------------------------- | :----------------------- | | Total Stockholders' Equity | $790,369 | $782,522 | | Share repurchases and net settlement of awards | $(42,794) | $(37,236) | | Dividends on common stock | $(24,772) | $(12,347) | | Net income | $58,049 | $36,852 | - Total stockholders' equity decreased slightly from $790,369 thousand at December 31, 2020, to $782,522 thousand at June 30, 2021, primarily due to share repurchases and dividends, partially offset by net income[12] - The company repurchased 1,030 thousand shares for $42,794 thousand during the six months ended June 30, 2021, and paid $24,772 thousand in cash dividends[12] Condensed Consolidated Statements of Cash Flows Cash Flow Summary (in thousands) | Metric | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :------------------------------------ | :--------------------------- | :--------------------------- | | Net cash provided by operating activities | $91,923 | $57,867 | | Net cash provided by/(used in) investing activities | $5,104 | $(4,482) | | Net cash (used in)/provided by financing activities | $(82,729) | $1,844 | | Net increase in cash and cash equivalents | $14,280 | $54,000 | | Cash and cash equivalents – end of period | $262,144 | $318,101 | - Net cash provided by operating activities increased to $91,923 thousand for the six months ended June 30, 2021, from $57,867 thousand in the prior-year period[15] - Net cash used in financing activities was $(82,729) thousand for the six months ended June 30, 2021, primarily due to share repurchases and cash dividends[15] Notes to Condensed Consolidated Financial Statements – Unaudited Note A – Basis of Reporting Unaudited condensed consolidated financial statements are prepared under GAAP and SEC regulations, with prior year reclassifications for consistent presentation - Financial statements are prepared in accordance with GAAP for interim information and SEC rules, including normal recurring adjustments[17] - Certain reclassifications were made to prior years' presentation to conform to the 2021 presentation, primarily related to segment reporting of corporate expenses and assets[17][20] Note B - COVID-19 and Restructuring Charges COVID-19 impacted 2020 operations with store closures and impairments; 2021 saw business improvements, reinstated dividends, and severance charges - COVID-19 led to temporary store closures, furloughs, salary reductions, and charges for trademark adjustments, asset impairments, and restructuring in 2020[18] - In 2021, the company experienced business improvements in retail and wholesale, reinstating quarterly cash dividends and stock repurchases[18] - The company recorded pre-tax charges of $433 thousand and $1,239 thousand for additional severance in Q2 2021 and H1 2021, respectively, related to its restructuring plan[19] Note C – Reclassification Prior years' financial amounts were reclassified to align with 2021 presentation, mainly affecting segment reporting of corporate expenses and assets - Reclassifications were made to prior years' amounts to conform to the 2021 presentation, mainly for segment reporting of corporate expenses and assets[20] Note D – Acquisitions In Q2 2021, the company acquired remaining non-controlling interests in European and South African joint ventures - Acquired remaining 49.9% non-controlling interest in European joint venture for $16,626 thousand on April 14, 2021[21] - Acquired remaining 49.9% non-controlling interest in South African joint venture for $2,501 thousand on June 28, 2021[22] Note E – Use of Estimates Financial statements require significant management estimates for revenue, bad debts, inventory, intangible assets, impairment, litigation, and contingent liabilities - Significant estimates include variable consideration in revenue, allowances for bad debts, inventory valuation, intangible asset valuation, impairment of long-lived assets, litigation reserves, and contingent payment liabilities[24] - The company estimates variable consideration for future customer chargebacks, markdown allowances, discounts, and returns by reviewing major customers' performance indicators[24] Note F– Factoring Agreement The company entered a factoring agreement with Rosenthal & Rosenthal, Inc. for receivables collection, with Rosenthal assuming credit risk - Entered into an Amended and Restated Deferred Purchase Factoring Agreement with Rosenthal & Rosenthal, Inc. on July 22, 2020[25] - Rosenthal serves as the collection agent for certain receivables, receiving a base commission of 0.20% of the gross invoice amount and assuming credit risk for credit-approved receivables[25] Note G – Short-Term Investments Short-term investments, primarily certificates of deposit, totaled $40,513 thousand as of June 30, 2021 Short-Term Investments (in thousands) | Date | Amount | | :---------------- | :------- | | June 30, 2021 | $40,513 | | December 31, 2020 | $39,302 | - Short-term investments consist of certificates of deposit with maturities of one year or less[26] Note H – Fair Value Measurement Fair value measurements use a three-level hierarchy, with Level 3 contingent consideration primarily from B.B. Dakota and GREATS Brand acquisitions Fair Value Measurements (in thousands) as of June 30, 2021 | Category | Fair value | Level 1 | Level 2 | Level 3 | | :---------------------- | :--------- | :------ | :------ | :------ | | Assets: | | | | | | Forward contracts | $140 | $— | $140 | $— | | Liabilities: | | | | | | Contingent consideration | $8,041 | $— | $— | $8,041 | | Forward contracts | $325 | $— | $325 | $— | - Level 3 contingent consideration of $8,041 thousand at June 30, 2021, primarily relates to earn-out provisions from the B.B. Dakota, Inc. and GREATS Brand, Inc. acquisitions, estimated using option pricing or risk-neutral simulation methods[28][29] - Adjustments to contingent consideration valuation resulted in an expense of $7,720 thousand for B.B. Dakota and $114 thousand for GREATS Brand in 2021[28] Note I – Leases The company leases properties under operating leases, with liabilities discounted using an incremental borrowing rate and variable payments expensed as incurred Lease Position (in thousands) | Metric | June 30, 2021 | December 31, 2020 | | :-------------------------------- | :------------ | :---------------- | | Operating lease right-of-use asset | $97,222 | $101,379 | | Operating leases - current portion | $33,561 | $34,257 | | Operating leases - long-term portion | $92,179 | $98,592 | | Total operating lease liabilities | $125,740 | $132,849 | | Weighted-average remaining lease term | 4.8 years | 5.0 years | | Weighted-average discount rate | 4.2 % | 4.3 % | Total Lease Cost (in thousands) | Metric | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2021 | | :---------------- | :------------------------------- | :----------------------------- | | Operating lease cost | $9,074 | $19,266 | | Variable lease cost | $5,621 | $12,975 | | Total lease cost | $14,615 | $32,080 | - The company made payments of $2,912 thousand and $9,505 thousand for COVID-19 lease amendments during the three and six months ended June 30, 2021, respectively, included in variable lease costs[35][37] Note J – Impairment of Other Long-Lived Assets Long-lived assets are evaluated for impairment; charges were recorded in 2021 for fixed assets and lease right-of-use assets in specific segments - Impairment charges of $477 thousand and $1,089 thousand were recorded for fixed assets and lease right-of-use assets for the three and six months ended June 30, 2021, respectively[40] - In the prior year, impairment charges were significantly higher at $1,178 thousand and $29,999 thousand for the three and six months ended June 30, 2020, due to COVID-19 impacts[40] Note K – Share Repurchase Program The Board authorized a $200,000 thousand share repurchase program; 736,076 shares were repurchased for $30,678 thousand in H1 2021 - The Share Repurchase Program, expanded to $200,000 thousand on April 24, 2019, has no fixed expiration date[41] Share Repurchase Activity (Six Months Ended June 30, 2021) | Metric | Value | | :------------------------------------ | :------------ | | Shares repurchased | 736,076 | | Aggregate purchase price | $30,678 | | Weighted average price per share | $41.68 | | Amount remaining for future repurchases | $80,912 | - An additional 294,205 shares were withheld for tax-withholding requirements and option costs, totaling approximately $12,115 thousand[42] Note L – Net Income/(Loss) Per Share of Common Stock Basic and diluted EPS are calculated based on weighted average common shares, with potential dilution from options and restricted stock - Basic net income/(loss) per share is based on weighted average common stock outstanding, excluding unvested restricted common stock[43] - Diluted net income per share includes potential dilution from in-the-money options and vesting restricted stock awards using the treasury method[43] - Approximately 13,000 and 2,000 options, and 0 and 8,000 restricted shares, were excluded from diluted EPS for the three and six months ended June 30, 2021, respectively, as they were anti-dilutive[43] Note M – Income Taxes Income tax provision is based on the estimated annual effective tax rate, which decreased in 2021 due to jurisdictional mix and lower GILTI Income Tax Provision and Effective Tax Rates | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :-------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Income/(loss) before provision (benefit) for income taxes | $46,941 | $(23,345) | $74,948 | $(48,547) | | Income tax expense/(benefit) | $9,600 | $(6,201) | $15,276 | $(13,602) | | Effective tax rate | 20.5% | 26.6% | 20.4% | 28.0% | - The decrease in effective tax rates in 2021 is primarily due to the expected jurisdictional mix of profit and losses and lower GILTI[44] - The company received or expects to receive corporate income tax benefits from the CARES Act, including net operating loss carryback, employee retention credit, and payroll tax deferral[46] Note N – Equity-Based Compensation Total equity-based compensation for H1 2021 was $11,019 thousand, with 7,985,790 shares available for grant under the 2019 Plan Equity-Based Compensation (in thousands) | Metric | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Restricted stock | $4,436 | $4,627 | $8,945 | $9,491 | | Stock options | $1,044 | $894 | $2,074 | $1,716 | | Total | $5,480 | $5,521 | $11,019 | $11,207 | - As of June 30, 2021, 7,985,790 shares of common stock were available for grant under the 2019 Plan[47] - Unrecognized compensation cost related to restricted stock awards was $51,970 thousand, expected to be recognized over a weighted average period of 4.0 years[52] Note O – Goodwill and Intangible Assets Goodwill totaled $168,426 thousand; identifiable intangible assets had a net carrying amount of $114,526 thousand, including a trademark sale gain Goodwill by Reporting Unit (in thousands) as of June 30, 2021 | Reporting Unit | Net Carrying Amount | | :-------------------------- | :------------------ | | Wholesale Footwear | $91,212 | | Wholesale Accessories/Apparel | $62,688 | | Retail | $14,526 | | Total Goodwill | $168,426 | Identifiable Intangible Assets (in thousands) as of June 30, 2021 | Asset Type | Net Carrying Amount | | :---------------------- | :------------------ | | Trade names | $128 | | Customer relationships | $14,996 | | Re-acquired right | $28,164 | | Trademarks | $71,238 | | Total Intangibles | $114,526 | - The company sold an internally developed trademark for $8,000 thousand during the quarter ended June 30, 2021, with the gain recorded in operating expenses[55] Note P – Derivative Instruments Forward foreign exchange contracts are used as cash flow hedges to manage currency risk on inventory purchases, with hedging activities deemed effective - The company uses forward foreign exchange contracts to manage foreign currency risk on forecasted inventory purchases, designating them as cash flow hedging instruments[57] - As of June 30, 2021, the net notional amount of the hedging portfolio was $26,288 thousand, with a fair value of $140 thousand in assets and $325 thousand in liabilities[57] - Hedging activities were considered effective for the three and six months ended June 30, 2021, with no ineffectiveness recognized in the Consolidated Statements of Income[57] Note Q – Commitments, Contingencies and Other The company has future minimum royalty and advertising payments and is involved in lawsuits, but management expects no material financial impact - Future minimum royalty and advertising payments totaled $17,813 thousand as of June 30, 2021, based on license agreements[58] - Management believes liabilities from legal proceedings will not have a material effect on the company's financial position or results of operations[59] Note R – Operating Segment Information The company operates five reportable segments: Wholesale Footwear, Wholesale Accessories/Apparel, Retail, First Cost, and Licensing, generating revenue domestically and internationally - The company operates five reportable segments: Wholesale Footwear, Wholesale Accessories/Apparel, Retail, First Cost, and Licensing[60] Total Revenue by Segment (in thousands) | Segment | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Wholesale Footwear | $198,113 | $77,966 | $414,891 | $313,035 | | Wholesale Accessories/Apparel | $64,011 | $22,018 | $138,633 | $89,690 | | Retail | $132,673 | $41,379 | $200,174 | $94,322 | | First Cost | $334 | $252 | $917 | $1,502 | | Licensing | $2,763 | $1,197 | $4,304 | $3,431 | | Total Revenue | $397,894 | $142,812 | $758,919 | $501,980 | Total Revenue by Geographic Area (in thousands) | Geographic Area | Three Months Ended June 30, 2021 | Three Months Ended June 30, 2020 | Six Months Ended June 30, 2021 | Six Months Ended June 30, 2020 | | :---------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Domestic | $353,300 | $126,131 | $668,946 | $444,568 | | International | $44,594 | $16,681 | $89,973 | $57,412 | | Total | $397,894 | $142,812 | $758,919 | $501,980 | Note S – Recent Accounting Pronouncements The company is evaluating ASU 2020-04 regarding LIBOR transition and expects no material impact on its financial statements - The company is evaluating ASU 2020-04, which provides practical expedients for contract modifications and hedging relationships related to the LIBOR transition[62] - The company does not expect the adoption of ASU 2020-04 to have a material impact on its condensed consolidated financial statements[62] Note T – Credit Agreement A $150,000 thousand secured revolving credit agreement was entered in 2020, with no outstanding borrowings as of June 30, 2021 - Entered into a $150,000 thousand secured revolving credit agreement on July 22, 2020, maturing July 22, 2025[63] - Borrowings bear variable interest rates based on LIBOR or the base rate, plus a specified margin[65] - As of June 30, 2021, the company had no cash borrowings or letters of credit outstanding under the Credit Facility[70] ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Provides an overview of the business, executive summary, detailed analysis of operations, liquidity, capital resources, and critical accounting policies Overview Steven Madden, Ltd. designs, sources, markets, and sells fashion-forward branded and private label footwear, handbags, apparel, and accessories globally - Steven Madden, Ltd. designs, sources, markets, and sells branded and private label footwear, handbags, apparel, and accessories[75] - Products are marketed through department stores, specialty stores, luxury retailers, mass merchants, online retailers, company-owned retail stores, and e-commerce websites across various international markets[75] - The company is recognized for design creativity, quality products, accessible price points, and efficient delivery[75] Executive Summary Revenue and earnings improved significantly in 2021 after a COVID-19 decline, with strong liquidity and no debt as of June 30, 2021 - Total revenue for Q2 2021 increased 178.6% to $397,894 thousand, and net income attributable to Steven Madden, Ltd. was $36,852 thousand, a significant turnaround from a net loss of $(16,586) thousand in Q2 2020[77] - Diluted net income per share was $0.45 in Q2 2021, compared to a loss of $(0.21) per share in Q2 2020[77] - As of June 30, 2021, the company had $302,657 thousand in cash, cash equivalents, and short-term investments, no debt, and working capital of $464,622 thousand[78] Results of Operations The company saw significant revenue and profit growth across segments in H1 2021, recovering from COVID-19, with improved gross margins and leveraged operating expenses Three Months Ended June 30, 2021 Compared to Three Months Ended June 30, 2020 Q2 2021 consolidated total revenue surged by 178.6%, with gross profit increasing to 42.7% and operating expenses decreasing as a percentage of revenue Consolidated Financial Performance (Three Months Ended June 30) | Metric | 2021 (in thousands) | 2020 (in thousands) | Change (%) | | :------------------------------------------ | :------------------ | :------------------ | :--------- | | Total revenue | $397,894 | $142,812 | 178.6% | | Gross profit | $170,055 (42.7%) | $55,888 (39.1%) | 204.3% | | Operating expenses | $121,860 (30.6%) | $78,412 (54.9%) | 55.4% | | Income/(loss) from operations | $47,718 (12.0%) | $(23,702) (-16.6%) | N/A | | Net income/(loss) attributable to Steven Madden, Ltd. | $36,852 (9.3%) | $(16,586) (-11.6%) | N/A | - Gross profit as a percentage of total revenue increased to 42.7% in Q2 2021 from 39.1% in Q2 2020, driven by a shift to retail and lower promotional activity, partially offset by inbound freight costs and GSP non-renewal[82] - Operating expenses as a percentage of total revenue decreased to 30.6% in Q2 2021 from 54.9% in Q2 2020, benefiting from higher revenues, expense control, and an $8,000 thousand gain on trademark sale[82] Six Months Ended June 30, 2021 Compared to Six Months Ended June 30, 2020 H1 2021 consolidated total revenue increased by 51.2%, with gross profit improving to 40.7% and operating expenses decreasing as a percentage of revenue Consolidated Financial Performance (Six Months Ended June 30) | Metric | 2021 (in thousands) | 2020 (in thousands) | Change (%) | | :------------------------------------------ | :------------------ | :------------------ | :--------- | | Total revenue | $758,919 | $501,980 | 51.2% | | Gross profit | $309,159 (40.7%) | $189,352 (37.7%) | 63.3% | | Operating expenses | $232,308 (30.6%) | $199,785 (39.8%) | 16.3% | | Income/(loss) from operations | $75,762 (10.0%) | $(49,950) (-10.0%) | N/A | | Net income/(loss) attributable to Steven Madden, Ltd. | $58,049 (7.6%) | $(34,037) (-6.8%) | N/A | - Gross profit as a percentage of total revenue increased to 40.7% in H1 2021 from 37.7% in H1 2020, driven by a higher penetration of retail, e-commerce strength, and the absence of prior-year COVID-19 related inventory reserves[91] - Operating expenses as a percentage of total revenue decreased to 30.6% in H1 2021 from 39.8% in H1 2020, due to greater leverage on higher revenue, a gain on trademark sale, and expense control initiatives[91] Liquidity and Capital Resources As of June 30, 2021, the company had $302,657 thousand in cash and investments, no debt, and sufficient liquidity for the next twelve months Liquidity Position (in thousands) | Metric | June 30, 2021 | December 31, 2020 | | :------------------------------------ | :------------ | :---------------- | | Cash, cash equivalents and short-term investments | $302,657 | $287,166 | | Working capital | $464,622 | N/A | | Debt | $— | N/A | - Cash provided by operations was $91,923 thousand for the six months ended June 30, 2021, an improvement from $57,867 thousand in the prior-year period, driven by increased net income and favorable changes in accounts payable[101] - Net cash used in financing activities was $82,729 thousand for the six months ended June 30, 2021, primarily due to $42,794 thousand in share repurchases and $24,772 thousand in cash dividends[103] Contractual Obligations (in thousands) as of June 30, 2021 | Contractual Obligations | Total | Remainder of 2021 | 2022-2023 | 2024-2025 | 2026 and after | | :------------------------------------ | :---- | :---------------- | :-------- | :-------- | :------------- | | Operating lease obligations | $138,838 | $20,459 | $59,089 | $35,739 | $23,551 | | Purchase obligations | $42,810 | $42,810 | $— | $— | $— | | Future minimum royalty and advertising payments | $17,813 | $4,125 | $13,688 | $— | $— | | Transition tax | $14,847 | $1,563 | $4,493 | $8,791 | $— | | Total | $214,308 | $68,957 | $77,270 | $44,530 | $23,551 | ITEM 3. Quantitative and Qualitative Disclosures About Market Risk The company faces market risks from variable interest rates and foreign currency fluctuations, using forward contracts to mitigate currency risk - The company is exposed to market risk from variable interest rates on its financing arrangements, primarily based on the prime rate and LIBOR[113] - Foreign currency risk arises from international operations and inventory purchases, which are primarily denominated in U.S. dollars, but may be impacted by exchange rate fluctuations[115] - A hypothetical 10% increase or decrease in the U.S. dollar against foreign currencies would result in an approximate $3,042 thousand net increase or decrease in the fair value of the derivatives portfolio as of June 30, 2021[116] ITEM 4. Controls and Procedures Disclosure controls and procedures were effective as of June 30, 2021, with no material changes to internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2021[118] - No material changes to internal control over financial reporting occurred during the quarter[119] - The COVID-19 pandemic has not had a material impact on the company's internal controls over financial reporting[119] PART II – OTHER INFORMATION ITEM 1. Legal Proceedings The company is involved in lawsuits, but management believes any liabilities will not materially impact financial position or results of operations - The company is a defendant in certain lawsuits in the normal course of business[120] - Management believes that any liabilities from these legal matters will not materially impact the company's financial position, results of operations, or cash flows[120] ITEM 1A. Risk Factors This section updates risk factors from the 10-K, specifically regarding liquidity maintenance during unforeseen events like the COVID-19 pandemic - Readers are directed to the risk factors discussed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2020[121] - The risk factor regarding the company's ability to maintain adequate liquidity during unforeseen events like COVID-19 is restated, highlighting potential business disruptions and temporary store closures[122][123] - All stores are currently open, but there's no assurance they will remain open if COVID-19 cases surge or new restrictive measures are implemented[123] ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds During Q2 2021, the company repurchased 876,241 shares for approximately $37,236 thousand, with no unregistered sales of common stock Common Stock Repurchases (Three Months Ended June 30, 2021) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Maximum Dollar Amount of Shares that May Yet Be Purchased Under the Plans or Programs | | :------------------- | :------------------------------- | :--------------------------- | :-------------------------------------------------------------------------------- | | 4/1/2021 - 4/30/2021 | 13,628 | $37.66 | $109,554 | | 5/1/2021 - 5/31/2021 | 358,137 | $41.21 | $95,058 | | 6/1/2021 - 6/30/2021 | 504,476 | $43.54 | $80,912 | | Total | 876,241 | $42.50 | N/A | - No unregistered sales of common stock occurred during the three months ended June 30, 2021[124] - Shares withheld for tax-withholding requirements and option costs during Q2 2021 amounted to approximately $8,498 thousand[125] ITEM 6. Exhibits This section lists exhibits filed with Form 10-Q, including CEO/CFO certifications and Interactive Data Files for financial statements - Exhibits include certifications from the Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) and 18 U.S.C. Section 1350[127] - Interactive Data Files (iXBRL) for the condensed consolidated financial statements are included as Exhibit 101 and 104[127] Signatures The Form 10-Q was signed on August 3, 2021, by the Chairman and CEO, and the Chief Financial Officer of Steven Madden, Ltd - The report was signed on August 3, 2021[129] - Signatories include Edward R. Rosenfeld, Chairman and Chief Executive Officer, and Zine Mazouzi, Chief Financial Officer[129]