Sweaty Betty owner lowers 2023 outlook after “disappointing” Q2
Wolverine Worldwide, the owner of Sweaty Betty and Sperry, dropped its full-year 2023 outlook after reviewing the declining second quarter, ending 1 July 2023.
The company simultaneously announced that Chris Hufnagel had been promoted to President and Chief Executive Officer.
In the second quarter, the company saw revenues of £463.7 million ($589.1 million), led by the activewear category. This was down by 14.4% from £561.6 million ($713.6 million) the year prior. Sales were down across all brands year-on-year.
Direct-to-consumer revenue of £104.2 million ($132.4 million) was down 20.3% compared to the prior year. Gross margin was 38.7% compared to 43% in the prior year, reflecting the sale of higher-cost inventory due to transitory supply chain costs from 2022.
Chris Hufnagel, the newly appointed President and Chief Executive Officer, commented: "Our second half outlook, as reflected in our updated annual guidance, is disappointing but we are confident that the work we are undertaking will drive significant profit improvement in 2024 and quickly set a strong growth foundation for the Company.
"The current adversity has not only deepened our conviction that our strategic direction is more correct than ever, but that we must execute it with greater boldness and speed."
Looking ahead, the company expects full-year 2023 revenues to be in the range of £1.78-1.79 billion ($2.26-$2.28 billion), representing a decline of approximately 10.7% to 10.0% versus the prior year. The gross margin is expected to be approximately 39.4% and the adjusted gross margin is expected to be approximately 40%.
Commenting on the adjusted outlook, Mike Stornant, Executive Vice President and Chief Financial Officer, said: "The trading environment is challenging, especially in global wholesale channels where order demand has slowed as retailers manage their businesses more cautiously.
"As a result, we have reduced our revenue and earnings outlook for the back half of the year."
