Retail in Asia

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Skechers returns to profit in 2Q13

Footwear maker Skechers USA Inc. returned to a profit in the second quarter of 2013 by posting a net profit of USD7.1 million on Wednesday, thanks to wholesale and company-owned retail businesses. That compares with a net loss of USD1.8m for the same period last year. Net sales for the three months ended on 30 June 2013 jumped 11.5 percent to USD428.2m.

Gross profit for the second quarter was USD194.9m or 45.5 percent of net sales compared to USD171.3m or 44.6 percent of net sales for the second quarter of last year. Earnings from operations were USD17.2m versus a loss from operations of USD1.5m for the second quarter of 2012.

"Our 45.5 percent gross margins are the result of improvements in our company-owned retail stores and international subsidiary businesses combined with the expected decrease in international distributor sales, which carry lower gross margins," said David Weinberg, chief operating officer and chief financial officer.

"Further, the demand for our fresh product also resulted in a 16.5 percent increase in domestic and international comp store sales, a leading indicator of the underlying strength of our product offerings."

For the six months ended on 30 June 2013, net sales surged 19.7 percent to USD879.9m from USD735.3m last year. Net profits were USD13.8 million compared to net a loss of USD5.4m last year.

"Based on the reaction at our recent key account meetings and current performance in the market, we believe the momentum we are experiencing will continue through this year and into next year," said Weinberg.