UPDATE 2-Crocs 4th-qtr profit up, margins hurt by higher costs
(Recasts; adds conference call details, updates share movement)
Feb 19 (Reuters) - Crocs Inc (CROX.O), the maker of brightly colored plastic shoes, posted an 84 percent rise in fourth-quarter profit but disappointed investors by reporting a lower gross margin and failing to raise its outlook for the year, triggering a 13 percent decline in its shares.
It is the latest in a series of setbacks for Crocs in the past few months. Its shares, which had been among the hottest performing in the U.S. market, have sunk 57 percent since hitting its year-high of $75.21 in October.
Crocs said the lower gross margin resulted from its decision to use much more expensive air delivery for shipping some of its new brand of winter shoes, known as Mammoths, as it faced greater-than-expected demand.
For the latest fourth quarter, net income rose to $38.3 million, or 45 cents a share, from $20.8 million, or 26 cents a share, a year earlier.
Revenue rose 99 percent to $224.8 million. International sales tripled to $109 million, while sales in the United States rose 47 percent to $115.8 million.
Analysts on average had expected a profit of 44 cents a share, before items, on revenue of $207.7 million, according to Reuters Estimates.
In a conference call with analysts, Crocs said it shipped about 3 million pairs of its Mammoth shoes, compared with its assumption of about 250,000, made in the third quarter.
Crocs, which launched its closed-toe line of shoes recently, said gross profit was $125.8 million, or 56 percent of revenue, compared with $65.1 million, or 57.7 percent of revenue, a year ago.
The company's recent string of bad news have included reports of slowing business, patent disputes in Europe and consumer concerns over the safety of its signature shoes.
OUTLOOK DISAPPOINTS
The company based in Niwot, Colorado, whose vibrantly colored shoes, clogs and boots have become a fad in recent years, also backed its 2008 profit outlook of $2.70 and revenue view of $1.16 billion.
Analysts were expecting a profit of $2.72, before items, on revenue of $1.16 billion.
In the call, it forecast first-quarter profit of 46 cents share, on revenue of $225 million, while analysts were expecting 50 cents a share, on revenue of $230.3 million.
Shares of Crocs fell to $27.71 in after-hours trading, after closing at $32.08 Tuesday on Nasdaq. (Reporting by Amitha Rajan in Bangalore; Editing by Anil D'Silva)
