UPDATE 2-Crocs slashes 2nd-qtr, 2008 forecasts; shares drop

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By Lisa Baertlein

LOS ANGELES, July 24 (Reuters) - Shares of Crocs Inc (CROX.O: Quote, Profile, Research, Stock Buzz) lost almost half of their value on Thursday after the shoemaker slashed second-quarter and 2008 profit and revenue forecasts on an unexpected slowdown in business and weak reorders.

Shares in the maker of brightly colored casual shoes, which had topped $75 in October, dropped to $4.93 in extended trade from a Nasdaq close of $8.95.

Crocs shares have been volatile this year as investors worried about its high inventory levels, which are liability in an economic downturn.

Soft and water-proof, Crocs were introduced in 2002 and quickly moved from niche to mainstream. But over the past year, bad news has rained down on the once high-flying company.

Consumers have complained that the shoes can get caught in escalators and cause injuries, and the European Union ruled one of Crocs' patents invalid.

The slowing U.S. economy has hit hard as retailers have trimmed shoe stocks. The company is closing its factory in Canada, and said on Thursday that more cost-cutting moves were in store.

Chief Executive Ron Snyder said in a statement that retailers across the board were "extremely cautious" with reorders and that overseas performance was weaker than expected.