TAIPEI: Crocs Inc. ( CROX ) said that it expects first quarter 2017 revenue to be between $255 and $265 million. Analysts polled by Thomson Reuters expected the company to report revenues of $277.77 million for the first-quarter. Analysts’ estimates typically exclude special items.
The company expects gross margin for the quarter to be approximately 200 basis points higher than first quarter 2016. The company expects Non-GAAP SG&A for the quarter to be moderately above prior year in absolute dollars.
The company expects 2017 revenue to be relatively flat compared to prior year reflecting the impact of store closings, the reduction of discount channel business and the disposition of our South Africa and Taiwan businesses during 2016, as it continues to focus on improving the quality of revenue.
The company continues to identify opportunities to improve the efficiency and effectiveness of its operations. In doing so, it has identified SG&A reductions in the amount of $75 to $85 million. These actions are projected to generate an annual $30 to $35 million improvement in earnings before interest and taxes by 2019.
It expects to achieve approximately $25 million of these SG&A reductions in 2017. It expects to incur one-time charges of approximately $10 to $15 million over the next two years to achieve these SG&A reductions, with approximately $7 to $10 million of that being incurred this year. In conjunction with these actions, It anticipate closing approximately 160 retail stores by the end of 2018, thereby reducing its total store count to approximately 400 from 558 at the end of 2016.
Andrew Rees, who joined the company in June 2014 as President, will be promoted to President and Chief Executive Officer effective June 1, 2017. Gregg Ribatt, current Chief Executive Officer, will remain on the Company’s Board of Directors.
