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 SKECHERS Announces Record Full-Year 2017 Sales of $4.16 Billion
   Thursday, February 08, 2018 4:05:06 PM ET

SKECHERS USA, Inc. (SKX ), a global footwear leader, today announced financial results for the fourth quarter and year ended December 31, 2017.

Fourth Quarter Highlights

-- Record sales of $970.6 million, an increase of 27.0 percent

-- Earnings from operations of $55.7 million, an increase of 96.9 percent

-- GAAP diluted loss per share of $0.43 due to a $0.64 one-time tax expense attributable to the Tax Cuts & Jobs Act, adjusted diluted earnings per share of $0.21

-- International wholesale sales increased 40.2 percent; total international wholesale and retail sales combined represented 52.6 percent of total sales

-- Domestic wholesale sales increased 11.6 percent

-- Company-owned global retail sales increased 25.8 percent, with a comparable same store sales increase of 12.0 percent globally

"2017 was a monumental year for Skechers as we achieved sales of more than $4 billion for the first time in our 25-year history," began Robert Greenberg, Skechers chief executive officer. "This growth is due to our continued focus on efficiencies and infrastructure as well as innovation, comfort, and relevancy within our product design. In the United States, we remained the No. 1 walking, work, casual lifestyle, and casual dress footwear brand, and the No. 2 casual athletic footwear brand*. Our team of legendary athletes and international celebrities, including the chart-topping singer Camila Cabello, drove worldwide appeal in marketing campaigns that represent our diverse product offering--from our heritage retro styling to the innovation and comfort that have become hallmarks of Skechers footwear. Furthermore, we grew our Skechers store base to 2,570 locations at year-end and saw impressive growth across the globe--including record sales on Single’s Day in China. As we look ahead, with fresh styles shipping for Spring, we believe we will remain a leader in the lifestyle footwear channel in the United States, selectively expand our retail footprint, and continue our global growth as we see our international business becoming an increasingly larger piece of our total business."

"With three months of strong sales, a robust holiday selling season that included increased demand for our innovative lighted children’s footwear and comfortable adult styles, and double-digit growth in each of our three distribution channels, we achieved a new fourth quarter sales record of $970.6 million," stated David Weinberg, chief operating officer of Skechers. "The four record sales quarters in 2017 resulted in a new annual sales record of $4.16 billion, an increase of over $600 million from the previous year’s sales. This growth is a testament to the worldwide strength and relevance of our product, marketing and brand."

                                                                                                                                                  
Fourth Quarter Financial Results
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
($ in millions, except per share data)
                                                                                                                                                                                          
                                                                                               For the three months
                                                                           ended December 31,                                                                                                                       Change
                         ----------------------------------------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------------------------
                                                 2017         2016                             $            %      
                                              -------------------- ------ --------------------                      -------------------- ----- --------------------                      -------------------- ------ --------------------                      ---------- --------------------
                                                                                                                                                                                                                                                                
Sales                                                            $  970.6                                                              $ 764.3                                                              $  206.3                                                 27.0 %
                                                                                                                                                                                                                                                                
Gross Profit                                                        454.1                                                                356.2                                                                  97.9                                                 27.5 %
  Gross Margin                                                       46.8 %                                                               46.6 %
                                                                                                                                                                                                                                                                
SG&A Expenses                                                       404.7                                                                332.9                                                                  71.8                                                 21.6 %
 As a % of Sales                                                     41.7 %                                                               43.6 %
                                                                                                                                                                                                                                                                
Earnings from Operations                                             55.7                                                                 28.3                                                                  27.4                                                 96.9 %
  Operating Margin                                                    5.7 %                                                                3.7 %
                                                                                                                                                                                                                                                                
Net Earnings (Loss)                                                 (66.7 )                                                                6.7                                                                 (73.4 )                                                 NM
                                                                                                                                                                                                                                                                
GAAP Diluted
Earnings Per Share                                                 ($0.43 )                                                            $  0.04                                                                ($0.47 )                                                 NM
                                                                                                                                                                                                                                                                
Adjusted Diluted
Earnings Per Share                                               $   0.21                                                              $  0.04                                                              $   0.17                                                425.0 %
                                                                                                                                                                                                                                                                           

Sales grew 27.0 percent as a result of a 40.2 percent increase in the Company’s international wholesale business, an 11.6 percent increase in the Company’s domestic wholesale business, and a 25.8 percent increase in its Company-owned global retail business. Comparable same store sales in Company-owned stores increased 12.0 percent, including a domestic increase of 10.5 percent and an international increase of 16.5 percent.

Gross margins increased due to strength in the Company’s international retail business and increased sales in the Company’s international subsidiary business.

SG&A expenses increased 21.6 percent. This increase was driven by $67.4 million in general and administrative expenses, including $37.8 million to support international growth in the Company’s joint venture and subsidiary businesses, and $20.1 million associated with operating 75 additional Company-owned Skechers stores, of which 22 were opened in the fourth quarter. Selling expenses increased by $4.4 million primarily due to higher international advertising expenses as well as $1.5 million in increased sales commissions in its South Korea joint-venture business.

Earnings from operations increased 96.9 percent primarily due to sales growth.

Net loss was $66.7 million and diluted loss per share was $0.43 per share. However, after adjusting for the impact of Tax Cuts & Jobs Act ("TCJA"), adjusted net earnings were $33.3 million and adjusted diluted earnings per share were $0.21.

Income Taxes

The enactment of the Tax Cuts and Jobs Act in December 2017 resulted in a provisional additional income tax expense of $99.9 million in the fourth quarter, or an impact of $0.64 per diluted share. The additional expense encompasses several elements, including a one-time tax on accumulated overseas profits and the revaluation of deferred tax assets and liabilities. As a result, the Company’s reported tax rate was 194.4 percent for the fourth quarter, and 38.8 percent for the full year. Excluding the additional expense, the Company’s tax rate would have been 12.2 percent for the fourth quarter and 12.8 percent for the full year. The Company will continue to analyze the impact of the TCJA to determine its full effects. However, based on current expectations, the Company’s 2018 annual tax rate is estimated to be in the range of 12 percent to 17 percent.

                                                                                                                                                     
Full-Year 2017 Financial Results
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
($ in millions, except per share data)
                                                                                                                                                                                             
                                                                                                 For the year ended
                                                                               December 31,                                                                                                                            Change
                         -------------------------------------------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------------------------
                                                  2017          2016                              $            %      
                                              -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------ --------------------                      ---------- --------------------
                                                                                                                                                                                                                                                                   
Sales                                                            $ 4,164.2                                                              $ 3,563.3                                                              $  600.9                                                 16.9 %
                                                                                                                                                                                                                                                                   
Gross Profit                                                       1,938.9                                                                1,634.6                                                                 304.3                                                 18.6 %
  Gross Margin                                                        46.6 %                                                                 45.9 %
                                                                                                                                                                                                                                                                   
SG&A Expenses                                                      1,572.7                                                                1,278.0                                                                 294.7                                                 23.1 %
 As a % of Sales                                                      37.8 %                                                                 35.9 %
                                                                                                                                                                                                                                                                   
Earnings from Operations                                             382.9                                                                  370.5                                                                  12.4                                                  3.3 %
  Operating Margin                                                     9.2 %                                                                 10.4 %
                                                                                                                                                                                                                                                                   
Net Earnings (Loss)                                                  179.2                                                                  243.5                                                                 (64.3 )                                              (26.4 %)
                                                                                                                                                                                                                                                                   
GAAP Diluted
Earnings Per Share                                               $    1.14                                                              $    1.57                                                                ($0.43 )                                              (27.4 %)
                                                                                                                                                                                                                                                                   
Adjusted Diluted
Earnings Per Share                                               $    1.78                                                              $    1.57                                                              $   0.21                                                 13.4 %
                                                                                                                                                                                                                                                                              

Full-year sales growth was the result of a 24.3 percent increase in the Company’s international wholesale business, a 21.9 percent increase in the Company’s global retail business, and a 4.1 percent increase in the Company’s domestic wholesale business. Comparable same store sales in Company-owned stores increased 7.2 percent, including a domestic increase of 6.4 percent and an international increase of 10.1 percent.

Gross margins improved due to the sale of more in-line product in 2017 and a stronger Company-owned retail and international business.

SG&A expenses increased 23.1 percent including an increase in selling expenses of $70.1 million primarily to support growth in its international markets. It also included an increase of 22.0 percent in general and administrative expenses principally due to $73.7 million in new store operating costs associated with 75 additional Company-owned stores opened in the year and $109.5 million to support growth in the Company’s international joint venture and subsidiary businesses.

Earnings from operations increased 3.3 percent primarily from increased sales growth.

Net earnings were $179.2 million and diluted earnings per share were $1.14 per share. However, after adjusting for the impact of TCJA, adjusted net earnings were $279.1 million and adjusted diluted earnings per share were $1.78.

Balance Sheet

At year-end 2017, cash and cash equivalents were $736.4 million, an increase of $17.9 million, or 2.5 percent over last year.

Total inventory, including inventory in transit, was $873.0 million, a $172.5 million increase, or 24.6 percent, over December 31, 2016, and in line with the Company’s incoming order rate, as well as the Company’s growing retail and wholesale businesses.

Working capital was $1.5 billion versus $1.2 billion at December 31, 2016, primarily reflecting increased investment in inventory for 2018.

"Our relevant and affordable products are resonating with consumers across the globe. This, combined with the investments and efficiencies we have made in our global infrastructure, directly contributed to our record sales performance in 2017. It also uniquely positions us for success in 2018 and beyond," said John Vandemore, chief financial officer of Skechers. "In addition, our strong balance sheet and significant free cash flow allows us to fully execute our capital allocation strategy by continuing to make high-growth investments and to return cash directly to stockholders in the form of a stock repurchase."

Share Repurchase

In February 2018, the Board of Directors authorized a stock repurchase program, under which the Company plans to repurchase up to $150 million of its Class A common stock through February 8, 2021 in the open market at prevailing prices.

Under the repurchase program, repurchases can be made from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions or otherwise, all in accordance with the United States Securities and Exchange Commission and other applicable legal requirements. The specific timing, price and size of purchases will depend on prevailing stock prices, general economic and market conditions, and other considerations. The repurchase program does not obligate the Company to acquire any particular amount of Class A common stock, and the repurchase program may be suspended or discontinued at any time at the Company’s discretion.

Outlook

For the first quarter of 2018, the Company believes it will achieve sales in the range of $1.175 billion to $1.200 billion, and diluted earnings per share of $0.70 to $0.75.

Fourth Quarter and Full Year 2017 Conference Call

The Company will host a conference call today at 1:30 p.m. PT / 4:30 p.m. Eastern Time to discuss its fourth quarter and full year 2017 financial results. The call can be accessed on the Investor Relations section of the Company’s website at www.skx.com. For those unable to participate during the live broadcast, a replay will be available beginning February 8, 2018, at 7:30 p.m. ET, through February 22, 2018, at 11:59 p.m. ET. To access the replay, dial 844-512-2921 (U.S.) or 412-317-6671 (International) and use passcode: 13655455.

Non-GAAP Financial Measures

References in this press release to "Sales" refers to the Company’s net sales reported under generally accepted accounting principles in the United States ("GAAP"). To supplement its financial results presented in accordance with GAAP, the Company presents certain non-GAAP financial measures within the meaning of Regulation G promulgated by the SEC. "Income Tax Expense," "Net Earnings (Loss)," "Basic and Diluted Earnings (Loss) Per Share" and the "Effective Tax Rate" are all measures for which the Company provides the reported GAAP measures and adjusted non-GAAP measures. References to "Adjusted Basic and Diluted Earnings Per Share" refers to GAAP reported Basic and Diluted Earnings Per Share adjusted for certain discrete or one-time items, including the impact of the recently enacted Tax Cuts & Jobs Act. Reconciliations of the non-GAAP financial measures with the comparable GAAP financial measures are described in the table and related disclosure below.

*SportsOneSource, January 9, 2018

About SKECHERS USA, Inc.

SKECHERS USA, Inc., based in Manhattan Beach, California, designs, develops and markets a diverse range of lifestyle footwear for men, women and children, as well as performance footwear for men and women. SKECHERS footwear is available in the United States and over 160 countries and territories worldwide via department and specialty stores, 2,570 SKECHERS Company-owned and third-party-owned retail stores, and the Company’s e-commerce websites. The Company manages its international business through a network of global distributors, joint venture partners in Asia and the Middle East, and wholly-owned subsidiaries in Canada, Japan, throughout Europe and Latin America. For more information, please visit skechers.com and follow us on Facebook (facebook.com/SKECHERS) and Twitter (twitter.com/SKECHERSUSA).

This announcement contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, Skechers’ future domestic and international growth, financial results and operations including expected net sales and earnings, its development of new products, future demand for its products, its planned domestic and international expansion, opening of new stores and additional expenditures, and advertising and marketing initiatives. Forward-looking statements can be identified by the use of forward-looking language such as "believe," "anticipate," "expect," "estimate," "intend," "plan," "project," "will be," "will continue," "will result," "could," "may," "might," or any variations of such words with similar meanings. Any such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements. Factors that might cause or contribute to such differences include international economic, political and market conditions including the challenging consumer retail markets in the United States; sustaining, managing and forecasting costs and proper inventory levels; losing any significant customers; decreased demand by industry retailers and cancellation of order commitments due to the lack of popularity of particular designs and/or categories of products; maintaining brand image and intense competition among sellers of footwear for consumers, especially in the highly competitive performance footwear market; anticipating, identifying, interpreting or forecasting changes in fashion trends, consumer demand for the products and the various market factors described above; sales levels during the spring, back-to-school and holiday selling seasons; and other factors referenced or incorporated by reference in the Company’s annual report on Form 10-K for the year ended December 31, 2016 and its quarterly report on Form 10-Q for the nine months ended September 30, 2017. The risks included here are not exhaustive. Skechers operates in a very competitive and rapidly changing environment. New risks emerge from time to time and the companies cannot predict all such risk factors, nor can the companies assess the impact of all such risk factors on their respective businesses or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, you should not place undue reliance on forward-looking statements as a prediction of actual results. Moreover, reported results should not be considered an indication of future performance.

                                                                                      
                                                           SKECHERS U.S.A., INC. AND SUBSIDIARIES
                                                            CONDENSED CONSOLIDATED BALANCE SHEETS
                                                                         (Unaudited)
                                                                       (In thousands)
                                                                                                                              
                                                                                  December 31,                      December 31,
                                                                                      2017                                                 2016
                                                                         -----------------------------  -------------------- ------------------------------
ASSETS
Current Assets:
  Cash and cash equivalents                                                                 $   736,431                                         $    718,536
  Trade accounts receivable, net                                                                405,921                                              326,844
  Other receivables                                                           27,083         19,191
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total receivables                                                                           433,004                                              346,035
  Inventories                                                                                   873,016                                              700,515
  Prepaid expenses and other current assets                                   62,573         62,680
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total current assets                                                                      2,105,024                                            1,827,766
Property, plant and equipment, net                                                              541,601                                              494,473
Deferred tax assets                                                                              29,922                                               26,043
Other assets                                                                  58,535         45,388
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total non-current assets                                                 630,058        565,904
                                                                         -------------------- --------- -------------------- -------------------- ----------
TOTAL ASSETS                                                                                $ 2,735,082                      $  2,393,670
                                                                         ==================== ========= ==================== ==================== ==========
LIABILITIES AND EQUITY
Current Liabilities:
  Current installments of long-term borrowings                                              $     1,801                                         $      1,783
  Accounts payable                                                                              505,334                                              520,437
  Short-term borrowings                                                                           8,011                                                6,086
  Accrued expenses                                                            82,202         93,424
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total current liabilities                                                                   597,348                                              621,730
  Long-term borrowings, net of current installments                                              71,103                                               67,159
  Deferred tax liabilities                                                                          161                                                  412
  Other long-term liabilities                                                118,259         18,855
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total non-current liabilities                                            189,523         86,426
                                                                         -------------------- --------- -------------------- -------------------- ----------
Total liabilities                                                                               786,871                                              708,156
Stockholders’ equity:
  Skechers U.S.A., Inc. equity                                                                1,829,064                                            1,603,633
  Noncontrolling interests                                                   119,147         81,881
                                                                         -------------------- --------- -------------------- -------------------- ----------
    Total equity                                                           1,948,211      1,685,514
                                                                         -------------------- --------- -------------------- -------------------- ----------
TOTAL LIABILITIES AND EQUITY                                                                $ 2,735,082                      $  2,393,670
                                                                         ==================== ========= ==================== ==================== ==========
                                                                                                                              
                                                                                                                                                                                                 
                                                                                                                                                               SKECHERS U.S.A., INC. AND SUBSIDIARIES
                                                                                                                                                            CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                                                                                                                                                                             (Unaudited)
                                                                                                                                                                (In thousands, except per share data)
                                                                                                                                                                                                                                         
                                                                                                                                       Three Months Ended December 31,                                                                                                                Twelve Months Ended December 31,
                                                                                                                 2017                                                2016                                                                    2017                                                  2016
                                                                                                               -------                                                                -------                                                                ---------                                                                ---------
Net sales                                                                                                    $ 970,589                                                              $ 764,290                                                              $ 4,164,160                                                              $ 3,563,311
Cost of sales                                                                               516,506       408,078       2,225,271       1,928,715  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
           Gross profit                                                                                        454,083                                                                356,212                                                                1,938,889                                                                1,634,596
Royalty income                                                                                6,297         4,983          16,666          13,885  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                                                                                            460,380       361,195       1,955,555       1,648,481  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Operating expenses:
   Selling                                                                                                      63,883                                                                 59,502                                                                  327,201                                                                  257,129
   General and administrative                                                               340,843       273,431       1,245,474       1,020,834  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                                                                                            404,726       332,933       1,572,675       1,277,963  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Earnings from operations                                                                                        55,654                                                                 28,262                                                                  382,880                                                                  370,518
Other income (expense):
   Interest, net                                                                                                  (937 )                                                               (1,472 )                                                                 (4,257 )                                                                 (5,084 )
   Other, net                                                                                   131        (4,640 )                            5,637          (5,950 )
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
                                                                                               (806 )                         (6,112 )                            1,380         (11,034 )
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Earnings before income tax expense                                                                              54,848                                                                 22,150                                                                  384,260                                                                  359,484
   Income tax expense                                                                       106,609         6,981         149,156          74,125  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
   Net (loss) earnings                                                                                         (51,761 )                                                               15,169                                                                  235,104                                                                  285,359
   Less: Net earnings attributable to non-controlling interests                              14,889         8,505          55,914          41,866  
                                                                                          -------------------- ------- -------------------- -------------------- -------------------- ------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
          Net (loss) earnings attributable to Skechers U.S.A., Inc.                                          $ (66,650 )                                         $   6,664                        $   179,190                        $   243,493  
                                                                                          ==================== ======= ==================== ==================== ==================== ======= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                  
                                                                                                                                                                                                                                                                                                                  
Net (loss) earnings per share attributable to Skechers U.S.A., Inc.:
   Basic                                                                                                     $   (0.43 )                                         $    0.04                        $      1.15                        $      1.58  
                                                                                          ==================== ======= ==================== ==================== ==================== ======= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
   Diluted                                                                                                   $   (0.43 )                                         $    0.04                        $      1.14                        $      1.57  
                                                                                          ==================== ======= ==================== ==================== ==================== ======= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                  
Weighted average shares used in calculating (loss) earnings per
share attributable to Skechers U.S.A., Inc.:
   Basic                                                                                    156,098       154,658         155,651         154,169  
                                                                                          ==================== ======= ==================== ==================== ==================== ======= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
   Diluted                                                                                  156,098       155,405         156,523         155,084  
                                                                                          ==================== ======= ==================== ==================== ==================== ======= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                                                 
                                                                      
                                                                                                                                                                            SKECHERS U.S.A., INC. AND SUBSIDIARIES
                                                                                                                                                                              SUPPLEMENTAL FINANCIAL INFORMATION
                                                                                                                                                                                       NON-GAAP MEASURES
                                                                                                                                                                                          (unaudited)
                                                                                                                                                                             (In thousands, except per share data)
                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                             Three months ended December 31,
                                                                                          ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Adjusted earnings, net (loss) earnings                                                                                                                                                      2017                                                                                                          2016   
per share and effective tax rate
--------------------------------------------------------------------                      -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------             --------------------                      -------------------- ------- --------------------
                                                                                            Reported                                           Adjustment                                                                Adjusted for                                                                   Reported
                                                                                                                 GAAP                                                                 For TCJA                                                                                      Non GAAP                                                                       GAAP
                                                                                                                Measure                                                                                                                                                            Measure (1)                                                                    Measure
                                                                                          -----------------------------------------------                        -----------------------------------------------                                          ---------------------------------------------------------                         -----------------------------------------------
Earnings before income tax expense                                                                           $  54,848                                                                      -                                                                                           $  54,848                                                              $  22,150
  Income tax expense                                                                        106,609                                           $ (99,937 )                                                                          6,672                            6,981  
                                                                                          -------------------- ------- --------------------                      -------------------- ------- --------------------                                        ------------------------------  ------- --------------------                      -------------------- ------- --------------------
  Net (loss) earnings                                                                                          (51,761 )                                                               99,937                                                                           48,176                                                                 15,169
  Less: Net earnings attributable to non-controlling interests                               14,889                                -                                                        14,889                            8,505  
                                                                                          -------------------- ------- --------------------                      -------------------- ------- --------------------                                        ------------------------------  ------- --------------------                      -------------------- ------- --------------------
                                                                                                             $ (66,650 )                                                            $  99,937                                                                        $  33,287                                           $   6,664  
    Net (loss) earnings attributable to Skechers U.S.A., Inc
                                                                                          ==================== ======= ====================                      ==================== ======= ====================                                        ==============================  ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                             
Effective tax rate                                                                                               194.4 %                                                                    -                                                                             12.2 %                                                                 31.5 %
                                                                                                                                                                                                                                                                                                                                             
Net (loss) earnings per share attributable to Skechers U.S.A., Inc.:
  Basic                                                                                                      $   (0.43 )                                                            $    0.64                                                                        $    0.21                                           $    0.04  
                                                                                          ==================== ======= ====================                      ==================== ======= ====================                                        ==============================  ======= ====================                      ==================== ======= ====================
  Diluted                                                                                                    $   (0.43 )                                                            $    0.64                                                                        $    0.21                                           $    0.04  
                                                                                          ==================== ======= ====================                      ==================== ======= ====================                                        ==============================  ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                             
                                                                                                                                                                                                                                                                                                                                             
                                                                                                                                                                                                                            Twelve months ended December 31,
                                                                                          ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Adjusted earnings, net earnings per share                                                                                                                                                   2017                                                                                                                             2016   
and effective tax rate
--------------------------------------------------------------------                      -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------             --------------------                      -------------------- ------- --------------------
                                                                                            Reported                                                                            Adjustment                                                        Adjusted for                                                             Reported
                                                                                                                 GAAP                                                                               For TCJA                                                                              Non GAAP                                                                 GAAP
                                                                                                                Measure                                                                                                                                                                  Measure (1)                                                              Measure
                                                                                          -----------------------------------------------                        -------------------------------------------------------------------------                           -----------------------------------------------                        -----------------------------------------------
Earnings before income tax expense                                                                           $ 384,260                                                                               -                                                               $ 384,260                                                              $ 359,484
  Income tax expense                                                                        149,156                                           $                             (99,937 )                                             49,219                           74,125  
                                                                                          -------------------- ------- --------------------                      -------------------- ---------------------------------   --------------------                       -------------------- ------- --------------------                      -------------------- ------- --------------------
  Net earnings                                                                                                 235,104                                                                          99,937                                                                 335,041                                                                285,359
  Less: Net earnings attributable to non-controlling interests                               55,914                                                            -                            55,914                           41,866  
                                                                                          -------------------- ------- --------------------                      -------------------- ---------------------------------   --------------------                       -------------------- ------- --------------------                      -------------------- ------- --------------------
    Net earnings attributable to Skechers U.S.A., Inc                                                        $ 179,190                                           $                              99,937                                            $ 279,127                                           $ 243,493  
                                                                                          ==================== ======= ====================                      ==================== =================================   ====================                       ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                             
Effective tax rate                                                                                                38.8 %                                                                             -                                                                    12.8 %                                                                 20.6 %
                                                                                                                                                                                                                                                                                                                                             
Net earnings per share attributable to Skechers U.S.A., Inc.:
  Basic                                                                                                      $    1.15                                           $                                0.64                                            $    1.79                                           $    1.58  
                                                                                          ==================== ======= ====================                      ==================== =================================   ====================                       ==================== ======= ====================                      ==================== ======= ====================
  Diluted                                                                                                    $    1.14                                           $                                0.64                                            $    1.78                                           $    1.57  
                                                                                          ==================== ======= ====================                      ==================== =================================   ====================                       ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                                                                                          

(1) During the fourth quarter of 2017, the Company recorded a net tax expense of $99.9 million related to the enactment of the Tax Cuts and Jobs Act. The expense is primarily related to the TCJA’s transition tax on previously unremitted earnings of non-U.S. subsidiaries and is net of remeasurement of Skechers’ deferred tax assets and liabilities considering the TCJA’s newly enacted tax rates. This provisional amount is subject to adjustment during the measurement period of up to one year following the December 2017 enactment of the TCJA, as provided by recent SEC guidance. In addition to reporting financial results in accordance with U.S. GAAP, the Company also provides non-GAAP measures that adjust for the net impact of enactment of the TCJA. This item represents a significant charge that impacted the Company’s financial results. Net earnings (loss), income tax expense, basic and diluted earnings (loss) per share, and the effective tax rate are all measures for which the Company provides the reported GAAP measure and an adjusted measure. The adjusted measures are not in accordance with, nor are they a substitute for, GAAP measures. The Company considers these non-GAAP measures in evaluating and managing the Company’s operations. The Company believes that discussion of results adjusted for this item is meaningful to investors as it provides a useful analysis of ongoing underlying operating trends. The determination of this item may not be comparable to similarly titled measures used by other companies.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20180208006337r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20180208006337/en/

SOURCE: SKECHERS USA, Inc.

Company Contact: 
SKECHERS USA, Inc. 
David Weinberg 
Chief Operating Officer 
John Vandemore 
Chief Financial Officer 
(310) 318-3100 
or 
Press: 
Jennifer Clay 
Vice President, 
Corporate Communications 
(310) 318-3100 
or 
Investor Relations: 
Addo Investor Relations 
Andrew Greenebaum 
(310) 829-5400


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