• Wolverine Worldwide Exceeds Fourth-Quarter Revenue and EPS Expectations

    来源: Nasdaq GlobeNewswire / 25 2月 2021 06:30:00   America/New_York

    ROCKFORD, Mich., Feb. 25, 2021 (GLOBE NEWSWIRE) -- Wolverine World Wide, Inc. (NYSE: WWW) today reported financial results for the fourth quarter and full year ended January 2, 2021.

    “The Company delivered better-than-expected results for the fourth quarter and is poised to drive an accelerated recovery over the next twelve to eighteen months,” said Blake W. Krueger, Wolverine Worldwide’s Chairman and Chief Executive Officer. “During a year of unprecedented challenges, we took action focused on the rapidly changing consumer landscape. Our owned eCommerce revenue grew 50% in 2020, and we have planned further investment in this area to enable growth of 40% in 2021, significantly outpacing broader industry expectations. Our balance sheet is healthy, and our brands are well positioned in winning product categories with strong momentum. Merrell, Saucony, Sperry, and Wolverine all plan to launch compelling new products behind some of their biggest franchises, and we anticipate meaningful growth for the Company in 2021, resulting in revenue approaching 2019 levels for the year.”

    FOURTH-QUARTER 2020 REVIEW

    • Reported revenue was $509.6 million, down 16.1% versus the prior year. On a constant currency basis, revenue was down 16.4% versus the prior year. Owned eCommerce reported revenue grew 31.7% versus the prior year.
    • Reported gross margin was 40.1%, compared to 37.8% in the prior year. Adjusted gross margin was 41.4%, compared to 37.8% in the prior year.
    • Reported operating margin was -40.1%, including the impact of a non-cash trade name impairment, compared to -0.9% in the prior year. Adjusted operating margin was 6.6%, compared to 10.1% in the prior year.
    • Reported diluted loss per share was $2.10, including the impact of a non-cash trade name impairment of $2.07 per share, compared to a loss per share of $0.01 in the prior year. Adjusted diluted earnings per share were $0.21, and, on a constant currency basis, were $0.22, compared to $0.59 in the prior year.
    • Inventory at the end of the quarter was down 30.2% versus the prior year.
    • Cash flow from operating activities in the quarter was $173.6 million, compared to $206.6 million in the prior year.
    • Cash on hand at the end of the quarter was $347.4 million, compared to $180.6 million in the prior year.

    FULL-YEAR 2020 REVIEW

    • Reported revenue was $1,791.1 million, down 21.2% versus the prior year on a reported and constant currency basis. Owned eCommerce reported revenue grew 49.9% versus the prior year.
    • Reported gross margin was 41.1%, compared to 40.6% in the prior year. Adjusted gross margin was 41.5%, compared to 40.6% in the prior year.
    • Reported operating margin was -7.7%, including the impact of a non-cash trade name impairment, compared to 7.5% in the prior year. Adjusted operating margin was 7.5%, compared to 11.5% in the prior year.
    • Reported diluted loss per share was $1.70, including the impact of a non-cash trade name impairment of $2.07 per share, compared to earnings per share of $1.44 in the prior year. Adjusted diluted earnings per share were $0.93, and, on a constant currency basis, were $0.95, compared to $2.25 in the prior year.
    • Cash flow from operating activities for the year was $309.1 million, compared to $222.6 million in the prior year.

    “Our team executed on key profit and liquidity priorities that were identified at the onset of the pandemic, resulting in annual operating cash flow of $309 million and $1.1 billion of total liquidity at year-end,” said Mike Stornant, Senior Vice President and Chief Financial Officer. “We are now able to increase our investment behind several key growth priorities supported by good visibility to robust demand and an eCommerce platform that continues to outperform. The Company is in an enviable position to drive profitable and accelerated growth in 2021.”

    FULL-YEAR 2021 OUTLOOK
    Wolverine Worldwide expects the positive momentum of its performance, athletic, outdoor, and work brands to continue in 2021. The Company is providing its initial revenue and earnings outlook for the full year, which assumes no meaningful deterioration of current market conditions related to the COVID-19 pandemic during the remainder of 2021.

    For the full 2021 fiscal year, the Company expects revenue in the range of $2,190 million to $2,250 million, growth of 22% to 26% versus the prior year, approaching 2019 revenue at the high end of the range. The Company is also focused on delivering its aspirational target of $500 million in owned eCommerce revenue, more than double 2019 owned eCommerce revenue. Reported diluted earnings per share are expected to be in the range of $1.75 to $1.90, and adjusted diluted earnings per share are expected to be in the range of $1.90 to $2.05.

    NON-GAAP FINANCIAL MEASURES
    Measures referred to in this release as “adjusted” financial results are non-GAAP measures that exclude impairment of intangible assets, environmental and other related costs net of recoveries, costs related to the COVID-19 pandemic including credit loss expenses, severance expenses, inventory adjustments and other related costs, non-cash impairment costs and reorganization expenses. The Company also presents constant currency information, which is a non-GAAP measure that excludes the impact of fluctuations in foreign currency exchange rates. The Company calculates constant currency basis by converting the current-period local currency financial results using the prior period exchange rates and comparing these adjusted amounts to the Company's current period reported results. The Company believes providing each of these non-GAAP measures provides valuable supplemental information regarding its results of operations, consistent with how the Company evaluates performance.

    The Company has provided a reconciliation of each of the above non-GAAP financial measures to the most directly comparable GAAP financial measure. The Company believes these non-GAAP measures provide useful information to both management and investors because it increases the comparability of current period results to prior period results by adjusting for certain items that may not be indicative of core operating results and enables better identification of trends in our business. The adjusted financial results are used by management to, and allow investors to, evaluate the operating performance of the Company on a comparable basis. Management does not, nor should investors, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

    EARNINGS CALL INFORMATION
    The Company will host a conference call today at 8:30 a.m. EST to discuss these results and current business trends. The conference call will be broadcast live and accessible under the “Investor Relations” tab at www.wolverineworldwide.com. A replay of the conference call will be available on the Company’s website for a period of approximately 30 days.

    ABOUT WOLVERINE WORLDWIDE
    Founded in 1883 on the belief in the possibility of opportunity, Wolverine World Wide, Inc. (NYSE:WWW) is one of the world’s leading marketers and licensors of branded casual, active lifestyle, work, outdoor sport, athletic, children's and uniform footwear and apparel. Through a diverse portfolio of highly recognized brands, our products are designed to empower, engage and inspire our consumers every step of the way. The Company’s portfolio includes Merrell®, Sperry®, Hush Puppies®, Saucony®, Wolverine®, Keds®, Stride Rite®, Chaco®, Bates®, and HYTEST®. Wolverine Worldwide is also the global footwear licensee of the popular brands Cat® and Harley-Davidson®. Based in Rockford, Michigan, for more than 130 years, the Company’s products are carried by leading retailers in the U.S. and globally in approximately 170 countries and territories. For additional information, please visit our website, www.wolverineworldwide.com.

    FORWARD-LOOKING STATEMENTS
    This press release contains forward-looking statements, including statements regarding the Company’s expectations regarding: its outlook for fiscal year 2021 revenue, earnings per share and owned eCommerce revenue; near-term demand; future growth; and new product launches. In addition, words such as “estimates,” “anticipates,” “believes,” “forecasts,” “step,” “plans,” “predicts,” “focused,” “projects,” “outlook,” “is likely,” “expects,” “intends,” “should,” “will,” “confident,” variations of such words, and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and involve certain risks, uncertainties, and assumptions (“Risk Factors”) that are difficult to predict with regard to timing, extent, likelihood, and degree of occurrence. Risk Factors include, among others: the effects of the COVID-19 pandemic on the Company’s business, operations, financial results and liquidity, including the duration and magnitude of such effects, which will depend on numerous evolving factors that the Company cannot currently accurately predict or assess, including: the duration and scope of the pandemic; the negative impact on global and regional markets, economies and economic activity, including the duration and magnitude of its impact on unemployment rates, consumer discretionary spending and levels of consumer confidence; actions governments, businesses and individuals take in response to the pandemic; the effects of the pandemic, including all of the foregoing, on the Company’s distributors, manufacturers, suppliers, joint venture partners, wholesale customers and other counterparties, and how quickly economies and demand for the Company’s products recover after the pandemic subsides; changes in general economic conditions, employment rates, business conditions, interest rates, tax policies and other factors affecting consumer spending in the markets and regions in which the Company’s products are sold; the inability for any reason to effectively compete in global footwear, apparel and consumer-direct markets; the inability to maintain positive brand images and anticipate, understand and respond to changing footwear and apparel trends and consumer preferences; the inability to effectively manage inventory levels; increases or changes in duties, tariffs, quotas or applicable assessments in countries of import and export; foreign currency exchange rate fluctuations; currency restrictions; capacity constraints, production disruptions, quality issues, price increases or other risks associated with foreign sourcing; the cost and availability of raw materials, inventories, services and labor for contract manufacturers; labor disruptions; changes in relationships with, including the loss of, significant wholesale customers; risks related to the significant investment in, and performance of, the Company’s consumer-direct operations; risks related to expansion into new markets and complementary product categories; the impact of seasonality and unpredictable weather conditions; changes in general economic conditions and/or the credit markets on the Company’s distributors, suppliers and retailers; increases in the Company’s effective tax rates; failure of licensees or distributors to meet planned annual sales goals or to make timely payments to the Company; the risks of doing business in developing countries, and politically or economically volatile areas; the ability to secure and protect owned intellectual property or use licensed intellectual property; the impact of regulation, regulatory and legal proceedings and legal compliance risks, including compliance with federal, state and local laws and regulations relating to the protection of the environment, environmental remediation and other related costs, and litigation or other legal proceedings relating to the protection of the environment or environmental effects on human health; the potential breach of the Company’s databases or other systems, or those of its vendors, which contain certain personal information, payment card data or proprietary information, due to cyberattack or other similar events; problems affecting the Company’s distribution system, including service interruptions at shipping and receiving ports; strategic actions, including new initiatives and ventures, acquisitions and dispositions, and the Company’s success in integrating acquired businesses, and implementing new initiatives and ventures; the risk of impairment to goodwill and other intangibles; changes in future pension funding requirements and pension expenses; and additional factors discussed in the Company’s reports filed with the Securities and Exchange Commission and exhibits thereto. The foregoing Risk Factors, as well as other existing Risk Factors and new Risk Factors that emerge from time to time, may cause actual results to differ materially from those contained in any forward-looking statements. Given these or other risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Furthermore, the Company undertakes no obligation to update, amend, or clarify forward-looking statements.

    WOLVERINE WORLD WIDE, INC.

    CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
    (Unaudited)
    (In millions, except earnings per share)

     Quarter Ended Fiscal Year Ended
     January 2,
    2021
     December 28,
    2019
     January 2,
    2021
     December 28,
    2019
    Revenue$509.6  $607.4  $1,791.1  $2,273.7 
    Cost of goods sold305.0  377.5  1,055.5  1,349.9 
    Gross profit204.6  229.9  735.6  923.8 
    Gross margin 40.1% 37.8% 41.1% 40.6%
            
    Selling, general and administrative expenses182.2  170.7  639.4  669.3 
    Impairment of intangible assets222.2    222.2   
    Environmental and other related costs, net of recoveries4.3  64.4  11.1  83.5 
    Operating expenses408.7  235.1  872.7  752.8 
    Operating expenses as a % of revenue80.2% 38.7% 48.7% 33.1%
            
    Operating profit (loss), net(204.1)  (5.2)  (137.1)  171.0 
    Operating margin(40.1)% (0.9)% (7.7)% 7.5%
            
    Interest expense, net12.5  8.2  43.6  30.0 
    Debt extinguishment, interest rate swap termination, and other costs5.3    5.5   
    Other expense (income), net0.8  (1.7)  (2.1)  (4.9) 
    Total other expenses18.6  6.5  47.0  25.1 
    Earnings (loss) before income taxes(222.7)  (11.7)  (184.1)  145.9 
            
    Income tax expense (benefit)(51.5)  (11.2)  (45.5)  17.0 
    Effective tax rate23.1% 95.3% 24.7% 11.7%
            
    Net earnings (loss)(171.2)  (0.5)  (138.6)  128.9 
            
    Less: net earnings (loss) attributable to noncontrolling interests(0.5)  0.4  (1.7)  0.4 
    Net earnings (loss) attributable to Wolverine World Wide, Inc.$(170.7)  $(0.9)  $(136.9)  $128.5 
    Diluted earnings (loss) per share$(2.10)  $(0.01)  $(1.70)  $1.44 
            
    Supplemental information:       
    Net earnings (loss) used to calculate diluted earnings (loss) per share$(170.9)  $(1.1)  $(137.7)  $126.0 
    Shares used to calculate diluted earnings (loss) per share81.2  80.5  81.0  87.2 

     

    WOLVERINE WORLD WIDE, INC.

    CONSOLIDATED CONDENSED BALANCE SHEETS
    (Unaudited)
    (In millions)

     January 2,
    2021
     December 28,
    2019
    ASSETS   
    Cash and cash equivalents$347.4  $180.6 
    Accounts receivables, net268.3  331.2 
    Inventories, net243.1  348.2 
    Other current assets45.4  107.1 
    Total current assets904.2  967.1 
    Property, plant and equipment, net124.6  141.0 
    Lease right-of-use assets142.5  160.8 
    Goodwill and other indefinite-lived intangibles824.7  1,043.4 
    Other noncurrent assets141.4  167.7 
    Total assets$2,137.4  $2,480.0 
        
    LIABILITIES AND STOCKHOLDERS' EQUITY   
    Accounts payable and other accrued liabilities$362.0  $380.8 
    Lease liabilities34.0  34.1 
    Current maturities of long-term debt10.0  12.5 
    Borrowings under revolving credit agreements  360.0 
    Total current liabilities406.0  787.4 
    Long-term debt712.5  425.9 
    Lease liabilities, noncurrent130.3  147.2 
    Other noncurrent liabilities315.6  341.1 
    Stockholders' equity573.0  778.4 
    Total liabilities and stockholders' equity$2,137.4  $2,480.0 

     

    WOLVERINE WORLD WIDE, INC.

    CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
    (Unaudited)
    (In millions)

     Fiscal Year Ended
     January 2,
    2021
     December 28,
    2019
    OPERATING ACTIVITIES:   
    Net earnings (loss)$(138.6)  $128.9 
    Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:   
    Depreciation and amortization32.8  32.7 
    Deferred income taxes(56.9)  (9.0) 
    Stock-based compensation expense28.9  24.5 
    Pension and SERP expense8.5  5.6 
    Debt extinguishment, interest rate swap termination, and other costs5.5   
    Impairment of intangible assets222.2   
    Environmental and other related costs, net of cash payments and recoveries received31.5  48.8 
    Other(12.7)  (11.6) 
    Changes in operating assets and liabilities187.9  2.7 
    Net cash provided by operating activities309.1  222.6 
        
    INVESTING ACTIVITIES:   
    Business acquisition, net of cash acquired(5.5)  (15.1) 
    Additions to property, plant and equipment(10.3)  (34.4) 
    Proceeds from sale of assets0.2   
    Investment in joint ventures(3.5)  (8.5) 
    Proceeds from company-owned insurance policy liquidations26.8   
    Other(1.6)  (3.5) 
    Net cash provided by (used in) investing activities6.1  (61.5) 
        
    FINANCING ACTIVITIES:   
    Payments under revolving credit agreements(898.0)  (469.3) 
    Borrowings under revolving credit agreements538.0  704.3 
    Borrowings of long-term debt471.0   
    Payments on long-term debt(183.5)  (7.5) 
    Payments of debt issuance and debt extinguishment costs(6.4)  (0.3) 
    Termination of interest rate swap(7.3)   
    Cash dividends paid(33.6)  (33.6) 
    Purchase of common stock for treasury(21.0)  (319.2) 
    Employee taxes paid under stock-based compensation plans(24.8)  (16.9) 
    Proceeds from the exercise of stock options9.8  12.2 
    Contributions from noncontrolling interests1.8  5.7 
    Net cash used in financing activities(154.0)  (124.6) 
        
    Effect of foreign exchange rate changes5.6  1.0 
    Increase in cash and cash equivalents166.8  37.5 
        
    Cash and cash equivalents at beginning of the year180.6  143.1 
    Cash and cash equivalents at end of the year$347.4  $180.6 

    The following tables contain information regarding the non-GAAP financial measures used by the Company in the presentation of its financial results:

     

    WOLVERINE WORLD WIDE, INC.

    Q4 2020 RECONCILIATION TABLES

    RECONCILIATION OF REPORTED REVENUE
    TO ADJUSTED REVENUE ON A CONSTANT CURRENCY BASIS*
    (Unaudited)
    (In millions)

     GAAP Basis
    2020-Q4
     Foreign
    Exchange
    Impact
     Constant
    Currency
    Basis 2020-Q4
     GAAP Basis
    2019-Q4
     Constant
    Currency Growth
    (Decline)
     Reported
    Growth
    (Decline)
    REVENUE           
    Wolverine Michigan Group$298.5  $(0.8)  $297.7  $360.0  (17.3)% (17.1)%
    Wolverine Boston Group197.6  (1.2)  196.4  234.1  (16.1)  (15.6) 
    Other13.5    13.5  13.3  1.5   1.5  
    Total$509.6  $(2.0)  $507.6  $607.4  (16.4)% (16.1)%

     

    RECONCILIATION OF REPORTED GROSS MARGIN
    TO ADJUSTED GROSS MARGIN*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustments (1) As Adjusted
          
    Gross Profit - Fiscal 2020 Q4$204.6  $6.3  $210.9 
          
    Gross margin40.1%   41.4%
          
    Gross Profit - Fiscal 2019 Q4$229.9  $  $229.9 
          
    Gross margin37.8%   37.8%
    (1)  Q4 2020 adjustments reflect expenses related to the COVID-19 pandemic including $3.2 million of inventory charges and $3.1 million of air freight charges related to production delays.

     

    RECONCILIATION OF REPORTED OPERATING MARGIN
    TO ADJUSTED OPERATING MARGIN*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustments (1) As Adjusted
          
    Operating Profit (Loss) - Fiscal 2020 Q4$(204.1)  $237.6  $33.5 
          
    Operating margin(40.1)%   6.6%
          
    Operating Profit (Loss) - Fiscal 2019 Q4$(5.2)  $66.5  $61.3 
          
    Operating margin(0.9)%   10.1%
    (1)  Q4 2020 adjustments reflect $222.2 million for a non-cash impairment of the Sperry trade name, $11.1 million of expenses related to the COVID-19 pandemic including $0.7 million of severance expenses, $3.6 million of facility exit costs, $3.2 million of inventory charges, $3.1 million of air freight charges related to production delays and $0.5 million of other costs and $4.3 million of environmental and other related costs net of recoveries. Q4 2019 adjustments reflect $64.4 million of environmental and other related costs net of a settlement and $2.1 million of costs related to business development costs and reorganization costs.

     

    RECONCILIATION OF REPORTED SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
    TO ADJUSTED SELLING, GENERAL AND ADMINISTRATIVE EXPENSES*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustment (1) As Adjusted
          
    Selling, general and administrative expenses - Fiscal 2020 Q4$408.7  $(231.3)  $177.4 
          
    Selling, general and administrative expenses - Fiscal 2019 Q4$235.1  $(66.5)  $168.6 
    (1)  Q4 2020 adjustments reflect $222.2 million for a non-cash impairment of the Sperry trade name, $4.8 million of expenses related to the COVID-19 pandemic including $0.7 million of severance expenses, $3.6 million of facility exit costs and $0.5 million of other costs, and $4.3 million of environmental and other related costs net of recoveries. Q4 2019 adjustments reflect $64.4 million of environmental and other related costs net of a settlement and $2.1 million of costs related to business development costs and reorganization costs.

     

    RECONCILIATION OF REPORTED DILUTED EPS TO ADJUSTED
    DILUTED EPS ON A CONSTANT CURRENCY BASIS*
    (Unaudited)

     GAAP Basis Adjustments (1) As Adjusted Foreign
    Exchange
    Impact
     As Adjusted
    EPS On a Constant
    Currency Basis
              
    EPS - Fiscal 2020 Q4$(2.10)  $2.31  $0.21  $0.01  $0.22 
              
    EPS - Fiscal 2019 Q4$(0.01)  $0.60  $0.59     
    (1)  Q4 2020 adjustments reflect a non-cash impairment of the Sperry trade name, expenses related to the COVID-19 pandemic, and environmental and other related costs net of recoveries. Q4 2019 adjustments reflect environmental and other related costs net of a settlement and costs related to business development costs and reorganization costs.

     

    RECONCILIATION OF THE REPORTED EFFECTIVE TAX RATE
    TO THE ADJUSTED EFFECTIVE TAX RATE*
    (Unaudited)

     GAAP Basis Adjustment (1) As Adjusted
          
    Effective Tax Rate - Fiscal 2020 Q423.1% (8.5)% 14.6%
          
    Effective Tax Rate - Fiscal 2019 Q495.3% (86.6)% 8.7%
    (1)  Q4 2020 adjustments reflect the tax impact of non-cash impairment of the Sperry trade name, expenses related to the COVID-19 pandemic, and environmental and other related costs net of recoveries. Q4 2019 adjustments reflect the tax impact of environmental and other related costs net of a settlement, business development costs and reorganization costs.

     

    2020 FULL-YEAR RECONCILIATION TABLES

    RECONCILIATION OF REPORTED REVENUE
    TO ADJUSTED REVENUE ON A CONSTANT CURRENCY BASIS*
    (Unaudited)
    (In millions)

     GAAP Basis
    2020
     Foreign
    Exchange
    Impact
     Constant
    Currency
    Basis 2020
     GAAP Basis
    2019
     Constant
    Currency Growth
    (Decline)
     Reported
    Growth
    (Decline)
    REVENUE           
    Wolverine Michigan Group$1,051.0  1.7  $1,052.7 $1,299.7  (19.0)% (19.1)%
    Wolverine Boston Group696.0  (1.2)  694.8 910.9  (23.7)  (23.6) 
    Other44.1    44.1 63.1  (30.1)  (30.1) 
    Total$1,791.1  $0.5  $1,791.6 $2,273.7  (21.2)% (21.2)%

     

    RECONCILIATION OF REPORTED GROSS MARGIN
    TO ADJUSTED GROSS MARGIN*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustments (1) As Adjusted
          
    Gross Profit - Fiscal 2020$735.6  $8.3  $743.9 
          
    Gross margin41.1%   41.5%
          
    Gross Profit - Fiscal 2019$923.8  $0.5  $924.3 
          
    Gross margin40.6%   40.6%
    (1)  2020 adjustments reflect expenses related to the COVID-19 pandemic including $4.4 million of inventory charges and $3.9 million of air freight charges related to production delays.

     

    RECONCILIATION OF REPORTED OPERATING MARGIN
    TO ADJUSTED OPERATING MARGIN*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustments (1) As Adjusted
          
    Operating Profit (Loss) - Fiscal 2020$(137.1)  $271.0  $133.9 
          
    Operating margin(7.7)%   7.5%
          
    Operating Profit - Fiscal 2019$171.0  $91.6  $262.6 
          
    Operating margin7.5%   11.5%
    (1)  2020 adjustments reflect $222.2 million for a non-cash impairment of the Sperry trade name, $37.7 million of expenses related to the COVID-19 pandemic including $10.9 million of severance expenses, $8.5 million of credit loss expenses, $4.9 million of inventory charges, $3.9 million of air freight charges related to production delays, $3.6 million of facility exit costs and $5.9 million of other costs, and $11.1 million of environmental and other related costs net of recoveries. 2019 adjustments reflect $83.5 million of environmental and other related costs net of a settlement and $8.1 million of other costs including business development costs and reorganization costs.

     

    RECONCILIATION OF REPORTED DILUTED EPS TO ADJUSTED
    DILUTED EPS ON A CONSTANT CURRENCY BASIS*
    (Unaudited)

     GAAP Basis Adjustments (1) As Adjusted Foreign
    Exchange
    Impact
     As Adjusted
    EPS On a Constant
    Currency Basis
              
    EPS - Fiscal 2020$(1.70)  $2.63  $0.93  $0.02  $0.95 
              
    EPS - Fiscal 2019$1.44  $0.81  $2.25     
    (1)  2020 adjustments reflect a non-cash impairment of the Sperry trade name, expenses related to the COVID-19 pandemic, and environmental and other related costs net of recoveries. 2019 adjustments reflect environmental and other related costs net of a settlement, business development costs and reorganization costs.

     

    2021 GUIDANCE RECONCILIATION TABLES

    RECONCILIATION OF REPORTED OPERATING MARGIN GUIDANCE
    TO ADJUSTED OPERATING MARGIN GUIDANCE*
    (Unaudited)
    (In millions)

     GAAP Basis Adjustments (1) As Adjusted
          
    Operating Profit - Fiscal 2021$230 - $245 $15.0  $245 - $260
          
    Operating margin10.5% - 10.9%   11.2% - 11.6%
    (1)  2021 adjustments reflect estimated environmental and other related costs net of recoveries and other costs.

     

    RECONCILIATION OF REPORTED DILUTED EPS GUIDANCE TO ADJUSTED
    DILUTED EPS GUIDANCE AND SUPPLEMENTAL INFORMATION*
    (Unaudited)

     GAAP Basis Adjustments (1) As Adjusted
          
    EPS - Fiscal 2021$ 1.75 - $1.90 $0.15  $ 1.90 - $2.05
          
    Supplemental information:     
          
    Net Earnings - Fiscal 2021$146 - $159 $12.0  $158 - $171
          
    Net Earnings used to calculate diluted earnings per share$143 - $156 $12.0  $155 - $168
          
    Shares used to calculate diluted earnings per share81.9   81.9
    (1)  2021 adjustments reflect estimated environmental and other related costs net of recoveries and certain other costs.
    1. To supplement the consolidated condensed financial statements presented in accordance with Generally Accepted Accounting Principles ("GAAP"), the Company describes what certain financial measures would have been if, impairment of intangible assets, environmental and other related costs net of recoveries, costs related to the COVID-19 pandemic including credit loss expenses, severance expenses and other related costs and reorganization expenses were excluded. The Company believes these non-GAAP measures provide useful information to both management and investors to increase comparability to the prior period by adjusting for certain items that may not be indicative of core operating measures and to better identify trends in our business. The adjusted financial results are used by management to, and allow investors to, evaluate the operating performance of the Company on a comparable basis.

    The constant currency presentation, which is a non-GAAP measure, excludes the impact of fluctuations in foreign currency exchange rates. The Company believes providing constant currency information provides valuable supplemental information regarding results of operations, consistent with how the Company evaluates performance. The Company calculates constant currency by converting the current-period local currency financial results using the prior period exchange rates and comparing these adjusted amounts to the Company's current period reported results.

    Management does not, nor should investors, consider such non-GAAP financial measures in isolation from, or as a substitution for, financial information prepared in accordance with GAAP. A reconciliation of all non-GAAP measures included in this press release, to the most directly comparable GAAP measures are found in the financial tables above.

    CONTACT: Michael D. Stornant
    (616) 866-5728


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