Steven Madden(US:SHOO)2024-02-28 18:12Financial Data and Key Metrics Changes - In Q4 2023, consolidated revenue was $519.7 million, a 10.4% increase compared to Q4 2022, with revenue growth of 2.3% excluding Almost Famous [22][24] - For the full year 2023, consolidated revenues decreased 6.6% to $2 billion from $2.1 billion in 2022, with net income attributable to Steven Madden Ltd at $182.7 million, or $2.45 per diluted share, down from $218.3 million, or $2.80 per diluted share in 2022 [12][21] - The effective tax rate for Q4 was 14.3%, down from 20.9% in Q4 2022 [23] Business Line Data and Key Metrics Changes - Wholesale accessories and apparel revenue was $129.6 million, up 56.5% year-over-year, driven by strong growth in handbags [11] - Direct-to-consumer (DTC) revenue was $162.3 million, a 1.9% increase compared to Q4 2022, with brick-and-mortar growth offset by a decline in e-commerce [11] - DTC revenue increased 2% in Q4 compared to the same period in the prior year, despite a 3% decline for the full year [20] Market Data and Key Metrics Changes - International revenue increased 11% in 2023 to $381 million, representing 19% of total revenue, with a focus on growth in the EMEA region [8] - The company plans to expand its DTC business internationally, particularly in EMEA, and expects to add 10 new stores in 2024 [9] Company Strategy and Development Direction - The company aims to leverage the Almost Famous platform to introduce Madden Girl and Madden NYC apparel, expanding its brand portfolio [20] - Focus areas for 2024 include driving growth in handbags, expanding DTC channels, and enhancing digital capabilities [20][21] - The company is committed to returning capital to shareholders, with over $200 million in dividends and share repurchases in 2023 [21] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging market environment in 2023, with cautious wholesale customers and reduced discretionary spending [19] - Despite challenges, management expressed confidence in the company's positioning for 2024, expecting revenue growth of 11% to 13% and diluted EPS in the range of $2.55 to $2.65 [24] - The company anticipates a healthier inventory situation in the wholesale channel, expecting a return to year-over-year revenue growth starting in Q1 2024 [35] Other Important Information - The company ended 2023 with $219.8 million in cash and no debt, with inventory flat year-over-year at $229 million [38] - The board approved a quarterly cash dividend of $0.21 per share, payable on March 22, 2024 [38] Q&A Session Summary Question: Impact of Macy's store closings on 2024 guidance - Management indicated minimal impact from Macy's store closures, as most business is with top-performing stores [26] Question: Expectations for wholesale footwear growth in 2024 - Management expects both branded and private label segments to grow, with private label anticipated to grow faster [41] Question: Breakdown of 2024 revenue guidance between DTC and wholesale - Management expects low to mid-single digit growth in wholesale and higher growth in DTC [45] Question: Gross margin expectations for 2024 - Management anticipates a 140 basis point pressure on gross margin due to Almost Famous and other factors [46] Question: Performance of wholesale channels and outlook for 2024 - Management is optimistic about the mass channel recovering and expects a better year with department stores [84]