20 December 2011
Americas/United States
Equity Research
Footwear
Deckers Outdoor Corporation
(DECK)
Rating OUTPERFORM*
Price (12 Dec 11, US$) 101.70 CHANNEL CHECK
Target price (US$) 127.00¹
52-week price range 117.66 - 72.38
Market cap. (US$ m) 3,926.44 UGG Demand Check Take Three: Accelerating
Enterprise value (US$ m) 3,682.55
*Stock ratings are relative to the relevant country benchmark.
¹Target price is for 12 months.
Stock-Outs
Research Analysts
Christian Buss We have updated our Nordstrom and uggaustralia.com stock-out analysis that
we started tracking on December 5th. Building on the results from last week’s
update, our checks show further increases in stock-outs in all categories. At
Bilun Boyner
Nordstrom stock-outs increased by 24 percentage points to 71.1% during the
past week while stock-outs at uggaustralia.com were effectively flat. Highlights
from our update include:
■ Classics and Slippers Stock-Outs Rising As Holidays Approach. With
the Holidays approaching stock-outs in Classics and Slippers started to
accelerate as they are chosen by many as the ‘most loved’ gift item. This
week Classics stock-out percentage increased by 31 points to 57.3% and
Slippers increased by 41 percentage points to 84.5%, now the highest
stock–out category.
■ Fashion and Men’s Stock-Outs Also Increasing As Expected. Stock-
Outs for Fashion styles increased by 12 percentage points to 81.7%. Men’s
stock-outs increased by 14 percentage points to 63.9%, led by Men’s Slipper
category which is stocked out at more than 90% of the stores.
■ Why We Like Stock-Outs? Deckers has a unique operating model for
UGGs predicated on limited availability of product late in the season. This
reduces discounting as retailers have limited inventory at the end of the
season which also creates a ‘phantom demand’ as consumers shop at
multiple stores to find the product they want or substitute for similar styles.
Share price performance Financial and valuation metrics
Daily Dec 13, 2010 - Dec 12, 2011, 12/13/10 = US$80.58 Year 12/10A 12/11E 12/12E 12/13E
EPS (CS adj.) (US$) 4.04 5.10 6.20 7.16
111
Prev. EPS (US$) — — — —
91 P/E (x) 25.2 19.9 16.4 14.2
P/E rel. (%) 170.3 156.8 141.7 137.3
71
Revenue (US$ m) 1,001.0 1,344.6 1,613.0 1,837.0
Dec-10 Mar-11 Jun-11 Sep-11
EBITDA (US$ m) 261.4 324.2 396.3 457.6
Price Indexed S&P 500 INDEX OCFPS (US$) 3.57 3.11 7.68 8.98
On 12/12/11 the S&P 500 INDEX closed at 1228.6 P/OCF (x) 22.3 32.7 13.2 11.3
EV/EBITDA (current) 14.8 12.0 9.8 8.5
Net debt (US$ m) -445 -244 -264 -310
ROIC (%) 82.72 55.50 41.95 39.62
Quarterly EPS Q1 Q2 Q3 Q4 Number of shares (m) 38.61 IC (current, US$ m) 497.06
2010A 0.46 0.23 1.07 2.27 BV/share (Next Qtr., US$) 19.6 EV/IC (x) 7.2
2011E 0.49 -0.19 1.59 3.21 Net debt (Next Qtr., US$ m) -243.9 Dividend (Next Qtr., US$) —
2012E 0.71 -0.07 1.83 3.72 Net debt/tot cap (Next Qtr., %) -33.9 Dividend yield (%) —
Source: Company data, Credit Suisse estimates.
DISCLOSURE APPENDIX CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, INFORMATION ON
TRADE ALERTS, ANALYST MODEL PORTFOLIOS AND THE STATUS OF NON-U.S ANALYSTS. U.S. Disclosure:
Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be
aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this
report as only a single factor in making their investment decision.
20 December 2011
Nordstrom
Exhibit 1: Nordstrom Stock-Outs w/w Changes (12/05, 12/12, 12/19)
Nordstrom - stock out %
(1314 styles/locations)
84.5%
81.7%
71.1% 70.1%
63.9%
60.5%
57.3%
47.6% 49.8%
43.4%
33.7% 33.8%
26.0% 24.2%
11.6%
Total Total Total Classics Classics Classics Fashion Fashion Fashion Slippers Slippers Slippers Men's Men's Men's
12/5 12/12 12/19 12/5 12/12 12/19 12/5 12/12 12/19 12/5 12/12 12/19 12/5 12/12 12/19
Source: Company data, Credit Suisse estimates
Uggaustralia.com
Exhibit 2: uggaustralia.com Stock-Out Changes W/W Changes (12/05 , 12/12, 12/19)
uggaustralia.com - stock out %
(185 styles/locations)
33% 33%
27%
8.7% 9.5% 9.5%
8.1% 7.1%
5.8%
0% 0% 0% 0% 0% 0%
/5
2
9
/5
2
9
/5
2
9
/5
2
9
5
12
19
/1
/1
/1
/1
/1
/1
/1
/1
12
2/
12
12
12
12
12
2/
2/
12
12
12
12
12
12
l1
l1
l1
cs
's
n
rs
cs
cs
ta
's
's
n
n
rs
rs
io
en
si
ta
ta
pe
io
io
To
en
en
si
si
pe
pe
sh
To
To
as
M
sh
sh
ip
as
as
M
M
ip
ip
Fa
Cl
Sl
Fa
Fa
Cl
Cl
Sl
Sl
Source: Company data, Credit Suisse estimates
Deckers Outdoor Corporation (DECK) 2
Deckers Outdoor Corporation (DECK)
Exhibit 3: Week Three Update
(as of 12/19/2011) Classics Fashion Slippers Men's
Laela
Bailey button Bailey Button Cardy Classic Channing Ravenna Savanna Bellevue II Aubree Dakota Ansley Coquette Ascot slippers - Classic Short -
Nordstrom Total Classic Tall Classic Short
(original)
Classic Mini
Triplet Knit Boot Boot boot Boot Boot Boot
Sparkles
Slippers Slipper Slipper Men's Men
"Butte" Boot
Sneaker
Details: Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Black - 9 Chestnut - 9 Honey - 9 Chocolate -9 Espresso - 9 Black - 9 Black - 9 Black - 9 Chestnut -9 Chestnut -9 Espresso-9 Black -9 Worchester-9
% of stock outs: 71.1% 35.6% 23.3% 82.2% 87.7% 67.1% 47.9% 86.3% 76.7% 95.9% 65.8% 95.9% 69.9% 83.6% 87.7% 82.2% 90.4% 53.4% 47.9%
NYC / New Jersey 7/9 7/9 4/9 0/9 6/9 4/9 4/9 8/9 1/9 2/9 1/9 4/9 1/9 2/9 3/9 2/9 5/9 9/9
Florida 4/6 6/6 1/6 2/6 2/6 4/6 0/6 0/6 0/6 0/6 0/6 2/6 4/6 3/6 1/6 1/6 0/6 1/6
Illinois 4/4 4/4 1/4 0/4 3/4 2/4 1/4 3/4 0/4 1/4 0/4 1/4 0/4 0/4 0/4 0/4 0/4 4/4
Texas 4/4 1/4 0/4 0/4 1/4 1/4 0/4 0/4 0/4 0/4 0/4 2/4 1/4 0/4 0/4 0/4 0/4 1/4
California (LA) 6/10 7/10 1/10 1/10 2/10 8/10 1/10 1/10 0/10 2/10 1/10 0/10 0/10 0/10 1/10 2/10 6/10 3/10
California (SF) 13/21 20/21 3/21 0/21 5/21 10/21 4/21 0/21 1/21 15/21 0/21 5/21 4/21 3/21 5/21 2/21 18/21 8/21
Georgia 0/3 0/3 1/3 0/3 0/3 1/3 0/3 0/3 0/3 0/3 0/3 1/3 1/3 0/3 0/3 0/3 0/3 0/3
Massachusetts 3/5 3/5 1/5 2/5 3/5 3/5 0/5 1/5 0/5 0/5 0/5 3/5 0/5 0/5 1/5 0/5 0/5 5/5
Pennsylvania 1/2 1/2 0/2 0/2 2/2 1/2 0/2 0/2 0/2 1/2 0/2 1/2 0/2 0/2 0/2 0/2 0/2 2/2
Michigan 1/3 3/3 0/3 0/3 0/3 1/3 0/3 1/3 0/3 1/3 0/3 1/3 0/3 0/3 1/3 0/3 0/3 2/3
Washington 4/6 4/6 1/6 4/6 0/6 3/6 0/6 3/6 1/6 3/6 1/6 2/6 1/6 1/6 1/6 0/6 5/6 3/6
Available # of stores: 47/73 56/73 13/73 9/73 24/73 38/73 10/73 17/73 3/73 25/73 3/73 22/73 12/73 9/73 13/73 7/73 34/73 38/73
uggaustralia.com
# of sizes in stock 6/7 7/7 7/7 7/7 7/7 4/7 13/13 13/13 6/8 11/13 1/13 13/13 8/8 8/8 8/8 10/17 12/12 17/17
stock out %: 8.1% .
Week of 12/05 Week of 12/12 Week of 12/19 Delta ( Wk 3 vs Wk 1)
Nordstrom uggaustralia.com Nordstrom uggaustralia.com Nordstrom uggaustralia.com Nordstrom uggaustralia.com
Total 33.7% 5.8% Total 47.6% 8.7% Total 71.1% 8.1% 37.4% 2.3%
Classics 11.6% 7.1% Classics 26.0% 9.5% Classics 57.3% 9.5% 45.7% 2.4%
Fashion 60.5% 27% Fashion 70.1% 33% Fashion 81.7% 33% 21.2% 5.5%
Slippers 24.2% 0% Slippers 43.4% 0% Slippers 84.5% 0% 60.3% 0.0%
Men's 33.8% 0% Men's 49.8% 0% Men's 63.9% 0% 30.1% 0.0%
Delta (Wk 2 vs Wk 1) Delta ( Wk 3 vs Wk 2)
Nordstrom uggaustralia.com Nordstrom uggaustralia.com
Total 13.9% 2.9% 23.5% -0.6%
Classics 14.4% 2.4% 31.3% 0.0%
Fashion 9.6% 5.5% 11.6% 0.0%
Slippers 19.2% 0.0% 41.1% 0.0%
Men's 16.0% 0.0% 14.2% 0.0%
20 December 2011
Source: Company data, Credit Suisse estimates
3
Deckers Outdoor Corporation (DECK)
Exhibit 4: Stock-Out Comparisons ( Wk 1 vs Wk 2)
(as of 12/12/2011) Classics Fashion Slippers Men's
Laela
Bailey button Bailey Button Cardy Classic Channing Ravenna Savanna Bellevue II Aubree Dakota Ansley Coquette Ascot slippers - Classic Short -
Nordstrom Total Classic Tall Classic Short
(original)
Classic Mini
Triplet Knit Boot Boot boot Boot Boot Boot
Sparkles
Slippers Slipper Slipper Men's Men
"Butte" Boot
Sneaker
Details: Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Black - 9 Chestnut - 9 Honey - 9 Chocolate -9 Espresso - 9 Black - 9 Black - 9 Black - 9 Chestnut -9 Chestnut -9 Espresso-9 Black -9 Worchester-9
% of stock outs: 47.6% 19.2% 4.1% 8.2% 79.5% 26.0% 19.2% 72.6% 63.0% 91.8% 61.6% 95.9% 35.6% 34.2% 54.8% 41.1% 56.2% 43.8% 49.3%
NYC / New Jersey 8/9 9/9 9/9 2/9 7/9 9/9 5/9 9/9 4/9 4/9 1/9 8/9 7/9 5/9 7/9 3/9 6/9 9/9
Florida 3/6 6/6 5/6 2/6 6/6 6/6 0/6 0/6 0/6 0/6 0/6 3/6 4/6 4/6 2/6 2/6 0/6 1/6
Illinois 4/4 4/4 4/4 0/4 4/4 3/4 2/4 4/4 0/4 1/4 0/4 3/4 3/4 2/4 3/4 0/4 0/4 4/4
Texas 4/4 4/4 4/4 0/4 4/4 1/4 1/4 0/4 0/4 0/4 0/4 4/4 3/4 3/4 1/4 1/4 0/4 0/4
California (LA) 9/10 9/10 8/10 3/10 8/10 9/10 1/10 1/10 0/10 3/10 1/10 2/10 4/10 2/10 7/10 5/10 8/10 3/10
California (SF) 16/21 20/21 19/21 0/21 14/21 18/21 9/21 2/21 1/21 15/21 0/21 15/21 15/21 9/21 13/21 13/21 21/21 8/21
Georgia 1/3 3/3 3/3 0/3 2/3 1/3 0/3 0/3 0/3 0/3 0/3 1/3 3/3 1/3 0/3 1/3 0/3 0/3
Massachusetts 4/5 5/5 4/5 3/5 3/5 4/5 1/5 1/5 0/5 0/5 0/5 4/5 2/5 5/5 2/5 1/5 0/5 5/5
Pennsylvania 1/2 1/2 2/2 1/2 2/2 1/2 1/2 0/2 0/2 1/2 0/2 2/2 1/2 1/2 0/2 1/2 0/2 2/2
Michigan 3/3 3/3 3/3 0/3 3/3 2/3 0/3 1/3 0/3 1/3 0/3 1/3 1/3 0/3 2/3 2/3 0/3 2/3
Washington 6/6 6/6 6/6 4/6 1/6 5/6 0/6 4/6 1/6 3/6 1/6 4/6 5/6 1/6 3/6 3/6 6/6 3/6
Available # of stores: 59/73 70/73 67/73 15/73 54/73 59/73 20/73 27/73 6/73 28/73 3/73 47/73 48/73 33/73 43/73 32/73 41/73 37/73
uggaustralia.com
# of sizes in stock 6/7 7/7 7/7 7/7 7/7 4/7 13/13 13/13 6/8 3/13 1/13 13/13 8/8 8/8 8/8 17/17 12/12 17/17
stock out %: 8.7%
* Highlighted numbers indicate restocking
(as of 12/6/2011) Classics Fashion Slippers Mens
Laela
Bailey button Bailey Button Cardy Classic Channing Ravenna Savanna Bellevue II Aubree Dakota Ansley Coquette Ascot slippers - Classic Short -
Nordstrom Total Classic Tall Classic Short
short
Classic Mini
Triplet Knit Boot Boot boot Boot Boot Boot
Sparkles
Slippers Slipper Slipper Men's Men
"Butte" Boot
Sneaker
Details: Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Chestnut -9 Black - 9 Chestnut - 9 Honey - 9 Chocolate -9 Espresso - 9 Black - 9 Black - 9 Black - 9 Chestnut -9 Chestnut -9 Espresso-9 Black -9 Worchester-9
% of stock outs: 33.7% 5.5% 0.0% 5.5% 35.6% 8.2% 15.1% 58.9% 63.0% 82.2% 27.4% 87.7% 43.8% 15.1% 16.4% 41.1% 17.8% 38.4% 45.2%
NYC / New Jersey 8/9 9/9 9/9 7/9 9/9 9/9 7/9 9/9 4/9 7/9 2/9 0/9 6/9 7/9 6/9 7/9 6/9 9/9
Florida 6/6 6/6 6/6 4/6 6/6 6/6 0/6 0/6 0/6 2/6 0/6 5/6 6/6 6/6 1/6 3/6 0/6 1/6
Illinois 4/4 4/4 4/4 1/4 4/4 3/4 3/4 4/4 1/4 3/4 1/4 3/4 1/4 4/4 3/4 2/4 0/4 4/4
Texas 4/4 4/4 3/4 2/4 4/4 1/4 1/4 0/4 0/4 1/4 1/4 4/4 3/4 4/4 2/4 3/4 0/4 1/4
California (LA) 9/10 10/10 9/10 6/10 8/10 9/10 4/10 2/10 3/10 8/10 2/10 3/10 9/10 8/10 6/10 10/10 10/10 3/10
California (SF) 20/21 21/21 19/21 9/21 19/21 19/21 11/21 3/21 1/21 20/21 1/21 18/21 20/21 16/21 15/21 19/21 21/21 8/21
Georgia 3/3 3/3 3/3 3/3 3/3 3/3 0/3 0/3 0/3 1/3 0/3 2/3 3/3 3/3 1/3 3/3 0/3 2/3
Massachusetts 4/5 5/5 5/5 5/5 5/5 5/5 1/5 2/5 1/5 2/5 0/5 0/5 4/5 5/5 4/5 4/5 1/5 5/5
Pennsylvania 2/2 2/2 2/2 2/2 2/2 2/2 1/2 2/2 1/2 1/2 0/2 0/2 2/2 2/2 1/2 1/2 0/2 2/2
Michigan 3/3 3/3 3/3 2/3 3/3 2/3 1/3 1/3 1/3 3/3 1/3 2/3 2/3 3/3 2/3 3/3 1/3 2/3
Washington 6/6 6/6 6/6 6/6 4/6 3/6 1/6 4/6 1/6 5/6 1/6 4/6 6/6 3/6 2/6 5/6 6/6 3/6
Available # of stores: 69/73 73/73 69/73 47/73 67/73 62/73 30/73 27/73 13/73 53/73 9/73 41/73 62/73 61/73 43/73 60/73 45/73 40/73
uggaustralia.com
# of sizes in stock: 7/7 7/7 7/7 7/7 7/7 4/7 13/13 13/13 6/8 5/13 3/13 13/13 8/8 8/8 8/8 17/17 12/12 17/17
% of stock outs: 5.8%
Week of 12/05 Week of 12/12 Delta
Nordstrom uggaustralia.com Nordstrom uggaustralia.com Nordstrom uggaustralia.com
Total 33.7% 5.8% Total 47.6% 8.7% 13.9% 2.9%
Classics 11.6% 7.1% Classics 26.0% 9.5% 14.4% 2.4%
Fashion 60.5% 27% Fashion 70.1% 33% 9.6% 5.5%
Slippers 24.2% 0% Slippers 43.4% 0% 19.2% 0.0%
Men's 33.8% 0% Men's 49.8% 0% 16.0% 0.0%
20 December 2011
Source: Company data, Credit Suisse estimates
4
20 December 2011
Exhibit4: Income Statement
Deckers Outdoor Corporation
Income Statement
($ In Millions Except Per Share Data)
2010 2010 2011 2011E 2012 2012E 2010 2011E 2012E 2013E 2014E 2015E
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 2Q12 2Q12 3Q12 4Q12
M arA JunA SepA DecA MarA JunA Se pA DecE MarE JunE SepE De cE
Revenues
U.S. 117.0 65.2 204.7 377.1 764.1 148.1 82.8 257.9 462.0 950.8 173.3 95.2 290.1 512.8 1071.5 764.1 950.8 1071.5 1238.7 1325.4 1404.9
International 38.9 71.8 73.2 53.0 236.9 56.7 71.5 156.5 109.1 393.7 91.9 115.2 184.4 150.0 541.6 236.9 393.7 541.6 598.3 737.9 880.3
UGG 104.4 100.2 255.8 412.8 873.1 148.4 108.3 376.7 538.3 1171.7 183.2 129.3 430.9 625.3 1368.8 873.1 1171.7 1368.8 1559.4 1750.3 1931.8
Teva 43.2 31.2 13.7 13.3 101.3 50.4 40.3 14.7 15.9 121.3 57.9 45.8 16.6 17.8 138.1 101.3 121.3 138.1 151.7 165.1 179.8
Other 8.4 5.6 8.4 4.1 26.5 6.0 5.7 23.0 16.9 51.6 24.1 35.3 27.0 19.8 106.2 26.5 51.6 106.2 126.0 147.9 173.7
Wholesale 114.4 121.9 249.1 298.2 783.5 146.0 128.4 369.4 390.7 1034.4 184.0 173.8 413.3 431.2 1202.3 783.5 1034.4 1202.3 1327.4 1451.8 1571.4
Direct 41.6 15.1 28.8 131.9 217.5 58.8 25.8 45.0 180.4 310.1 81.2 36.6 61.2 231.7 410.7 217.5 310.1 410.7 509.7 611.5 713.8
Ecommerce 18.4 5.2 8.7 59.5 91.8 23.5 5.7 10.3 68.3 107.8 28.2 7.0 11.9 80.2 127.3 91.8 107.8 127.3 148.5 172.9 201.4
Retail 23.1 10.0 20.2 72.4 125.6 35.4 20.1 34.7 112.1 202.3 53.1 29.6 49.3 151.5 283.4 125.6 202.3 283.4 361.2 438.7 512.4
Total Revenues 155.9 137.1 277.9 430.1 1001.0 204.9 154.2 414.4 571.1 1344.6 265.2 210.4 474.5 662.9 1613.0 1001.0 1344.6 1613.0 1837.0 2063.3 2285.2
Cost Of Sales
COGS 78.0 76.3 146.9 196.8 498.1 102.4 88.3 211.5 259.8 662.0 132.6 119.9 241.1 299.6 793.2 498.1 662.0 793.2 896.8 997.8 1094.8
Gross Profit 77.9 60.7 131.0 233.3 502.9 102.5 65.9 202.9 311.2 682.5 132.6 90.5 233.5 363.2 819.8 502.9 682.5 819.8 940.2 1065.5 1190.4
Total SG&A 49.1 47.5 64.6 92.6 253.9 74.3 76.7 112.2 128.5 391.7 92.0 94.1 129.1 151.1 466.4 253.9 391.7 466.4 534.2 603.4 677.0
Marketing 47.0 63.2 75.8 47.0 63.2 75.8 86.3 97.0 107.4
Other SG&A 206.8 328.5 390.6 206.8 328.5 390.6 447.9 506.5 569.6
Impairment Loss 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Operating Income (EBIT) 28.8 13.2 66.3 140.7 249.1 28.2 (10.8) 90.7 182.7 290.8 40.6 (3.7) 104.4 212.1 353.4 249.1 290.8 353.4 406.0 462.0 513.4
D&A 3.9 2.3 2.6 3.4 12.3 5.9 5.7 10.4 11.4 33.3 8.0 8.0 12.6 14.3 42.9 12.3 33.3 42.9 51.6 58.0 61.9
EBITDA 32.7 15.6 68.9 144.2 261.4 34.1 (5.1) 101.0 194.2 324.1 48.6 4.4 117.0 226.4 396.3 261.4 324.1 396.3 457.6 520.0 575.3
Other Expenses/(Income)
Interest Income (Expense) 0.0 (0.1) (0.1) (0.2) (0.3) 0.1 0.0 (0.1) (0.2) (0.1) (0.2) (0.2) (0.2) (0.2) (0.8) (0.3) (0.1) (0.8) (0.8) (0.8) (0.8)
Other Income (Expense) 0.1 0.6 0.3 0.4 1.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.4 0.0 0.0 0.0 0.0 0.0
Pre-Tax Income 28.9 13.7 66.5 141.0 250.1 28.3 (10.8) 90.6 182.5 290.7 40.4 (3.9) 104.2 211.9 352.6 250.1 290.7 352.6 405.2 461.2 512.5
Tax Rate 37.2% 35.0% 36.9% 35.2% 35.9% 30.0% 30.0% 31.2% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 35.9% 31.0% 31.0% 30.5% 30.0% 30.0%
Taxes 10.7 4.8 24.6 49.6 89.7 8.5 (3.2) 28.3 56.6 90.1 12.5 (1.2) 32.3 65.7 109.3 89.7 90.1 109.3 123.6 138.4 153.8
Net Income (Before Non Recurring 18.1 8.9 42.0 91.4 160.4 19.8 (7.5) 62.3 125.9 200.6 27.9 (2.7) 71.9 146.2 243.3 160.4 200.6 243.3 281.6 322.8 358.8
Minority Interest 0.2 0.1 (0.2) 2.1 2.3 0.7 (0.2) (0.1) (0.1) 0.2 0.0 0.0 0.0 0.0 0.0 2.3 0.2 0.0 0.0 0.0 0.0
Preferred Stock Redemption Premium 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Income/(Loss) (After Non Recurrin 17.895 8.9 42.1 89.2 158.1 19.2 (7.3) 62.5 126.1 200.4 27.9 (2.7) 71.9 146.2 243.3 158.1 200.4 243.3 281.6 322.8 358.8
Basic EPS 0.46 0.23 1.09 2.31 4.09 0.50 (0.19) 1.62 3.26 5.19 0.72 (0.07) 1.86 3.78 6.29 4.09 5.19 6.29 7.26 8.30 9.20
Diluted EPS 0.46 0.23 1.07 2.27 4.04 0.49 (0.19) 1.59 3.21 5.10 0.71 (0.07) 1.83 3.72 6.20 4.04 5.10 6.20 7.16 8.19 9.09
One-Time Charges 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tax Impact Of 1X Charges 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
GAAP Net Income 17.9 8.9 42.1 89.2 158.1 19.2 (7.3) 62.5 126.1 200.4 27.9 (2.7) 71.9 146.2 243.3 158.1 200.4 243.3 281.6 322.8 358.8
Basic GAAP EPS 0.46 0.23 1.09 2.31 4.09 0.50 (0.19) 1.62 3.26 5.19 0.72 (0.07) 1.86 3.78 6.29 4.09 5.19 6.29 7.26 8.30 9.20
Diluted GAAP EPS 0.46 0.23 1.07 2.27 4.04 0.49 (0.19) 1.59 3.21 5.10 0.71 (0.07) 1.83 3.72 6.20 4.04 5.10 6.20 7.16 8.19 9.09
Basic Shares Outstanding 38.6 38.7 38.6 38.5 38.6 38.6 38.7 38.6 38.6 38.6 38.7 38.7 38.7 38.7 38.7 38.6 38.6 38.7 38.8 38.9 39.0
Diluted Shares Outstanding 39.1 39.1 39.2 39.3 39.2 39.4 38.7 39.2 39.2 39.3 39.2 38.7 39.3 39.3 39.3 39.2 39.3 39.3 39.3 39.4 39.5
Y/Y Growth
U.S. 14.7% 16.2% 14.3% 22.1% 18.3% 26.6% 26.9% 26.0% 22.5% 24.4% 17.0% 15.0% 12.5% 11.0% 12.7% 18.3% 24.4% 12.7% 15.6% 7.0% 6.0%
International 20.8% 54.8% 48.2% 35.2% 41.7% 45.8% -0.5% 113.9% 105.9% 66.2% 62.0% 61.3% 17.9% 37.6% 37.6% 41.7% 66.2% 37.6% 10.5% 23.3% 19.3%
UGG 14.2% 34.6% 20.2% 23.8% 22.7% 42.2% 8.0% 47.3% 30.4% 34.2% 23.5% 19.5% 14.4% 16.2% 16.8% 22.7% 34.2% 16.8% 13.9% 12.2% 10.4%
Teva 21.4% 38.4% 51.7% 26.2% 30.5% 16.8% 29.1% 7.4% 19.6% 19.7% 14.9% 13.7% 12.7% 11.9% 13.8% 30.5% 19.7% 13.8% 9.9% 8.9% 8.9%
Other 15.0% 1.1% 26.5% -2.3% 11.9% -28.3% 0.4% 173.9% 315.7% 94.8% 299.9% 523.2% 17.6% 17.0% 105.8% 11.9% 94.8% 105.8% 18.6% 17.4% 17.4%
0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Wholesale 9.9% 33.7% 19.9% 16.7% 19.0% 27.7% 5.3% 48.3% 31.0% 32.0% 26.0% 35.4% 11.9% 10.4% 16.2% 19.0% 32.0% 16.2% 10.4% 9.4% 8.2%
Direct 38.0% 33.1% 39.3% 42.7% 40.6% 41.5% 70.7% 56.1% 36.8% 42.6% 38.1% 41.7% 36.0% 28.4% 32.5% 40.6% 42.6% 32.5% 24.1% 20.0% 16.7%
Ecommerce 13.8% -1.6% 3.8% 29.8% 21.3% 27.3% 10.3% 18.9% 14.8% 17.4% 20.0% 23.3% 15.8% 17.4% 18.1% 21.3% 17.4% 18.1% 16.6% 16.4% 16.5%
Retail 66.1% 63.1% 63.3% 55.4% 59.1% 52.8% 102.2% 72.1% 54.8% 61.0% 50.0% 46.9% 42.0% 35.1% 40.1% 59.1% 61.0% 40.1% 27.5% 21.4% 16.8%
Total Revenues 16.2% 33.7% 21.7% 23.6% 23.1% 31.4% 12.5% 49.1% 32.8% 34.3% 29.5% 36.4% 14.5% 16.1% 20.0% 23.1% 34.3% 20.0% 13.9% 12.3% 10.8%
Margins%
Gross Margin 50.0% 44.3% 47.1% 54.2% 50.2% 50.0% 42.7% 49.0% 54.5% 50.8% 50.0% 43.0% 49.2% 54.8% 50.8% 50.2% 50.8% 50.8% 51.2% 51.6% 52.1%
Y/Y Change 607bp 455bp 424bp 441bp 461bp 6bp -158bp 183bp 25bp 51bp -3bp 26bp 24bp 30bp 7bp 461bp 51bp 7bp 36bp 46bp 45bp
EBITDA 21.0% 11.4% 24.8% 33.5% 26.1% 16.6% -3.3% 24.4% 34.0% 24.1% 18.3% 2.1% 24.7% 34.2% 24.6% 26.1% 24.1% 24.6% 24.9% 25.2% 25.2%
Pre-Tax Income 18.5% 10.0% 23.9% 32.8% 25.0% 13.8% -7.0% 21.9% 32.0% 21.6% 15.2% -1.8% 22.0% 32.0% 21.9% 25.0% 21.6% 21.9% 22.1% 22.4% 22.4%
Effective Tax Rate 37.2% 35.0% 36.9% 35.2% 35.9% 30.0% 30.0% 31.2% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 35.9% 31.0% 31.0% 30.5% 30.0% 30.0%
Net Margin 11.6% 6.5% 15.1% 21.2% 16.0% 9.7% -4.9% 15.0% 22.1% 14.9% 10.5% -1.3% 15.2% 22.1% 15.1% 16.0% 14.9% 15.1% 15.3% 15.6% 15.7%
COGS 50.0% 55.7% 52.9% 45.8% 49.8% 50.0% 57.3% 51.0% 45.5% 49.2% 50.0% 57.0% 50.8% 45.2% 49.2% 49.8% 49.2% 49.2% 48.8% 48.4% 47.9%
SG&A 31.5% 34.7% 23.3% 21.5% 25.4% 36.3% 49.7% 27.1% 22.5% 29.1% 34.7% 44.7% 27.2% 22.8% 28.9% 25.4% 29.1% 28.9% 29.1% 29.2% 29.6%
Y/Y Change 199bp -98bp 362bp 204bp 214bp 478bp 1506bp 381bp 97bp 377bp -156bp -500bp 12bp 30bp -22bp 214bp 377bp -22bp 17bp 17bp 38bp
Marketing 0.0% 0.0% 0.0% 0.0% 4.7% 0.0% 0.0% 0.0% 0.0% 4.7% 0.0% 0.0% 0.0% 0.0% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7% 4.7%
Other SG&A 0.0% 0.0% 0.0% 0.0% 20.7% 0.0% 0.0% 0.0% 0.0% 24.4% 0.0% 0.0% 0.0% 0.0% 24.2% 20.7% 24.4% 24.2% 24.4% 24.5% 24.9%
Operating Margin 18.5% 9.6% 23.9% 32.7% 24.9% 13.8% -7.0% 21.9% 32.0% 21.6% 15.3% -1.7% 22.0% 32.0% 21.9% 24.9% 21.6% 21.9% 22.1% 22.4% 22.5%
Y/Y Change 409bp 552bp 63bp 237bp 247bp -472bp -1664bp -198bp -72bp -326bp 154bp 526bp 12bp 0bp 28bp 247bp -326bp 28bp 19bp 29bp 7bp
Tax Rate 37.2% 35.0% 36.9% 35.2% 35.9% 30.0% 30.0% 31.2% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 31.0% 35.9% 31.0% 31.0% 30.5% 30.0% 30.0%
D&A 2.5% 1.7% 0.9% 0.8% 1.2% 2.9% 3.7% 2.5% 2.0% 2.5% 3.0% 3.8% 2.7% 2.2% 2.7% 1.2% 2.5% 2.7% 2.8% 2.8% 2.7%
D&A As % Of Pp&E 10.8% 6.3% 6.1% 7.2% 25.7% 11.9% 10.4% 17.5% 15.9% 46.5% 10.2% 9.6% 15.5% 18.5% 55.7% 25.7% 46.5% 55.7% 74.7% 97.8% 122.7%
COGS 3.6% 23.6% 12.6% 12.7% 12.7% 31.2% 15.7% 44.0% 32.0% 32.9% 29.5% 35.8% 14.0% 15.3% 19.8% 12.7% 32.9% 19.8% 13.1% 11.3% 9.7%
SG&A 24.0% 30.0% 44.1% 36.5% 34.4% 51.3% 61.4% 73.6% 38.8% 54.3% 23.9% 22.7% 15.0% 17.6% 19.1% 34.4% 54.3% 19.1% 14.6% 13.0% 12.2%
Net Income 45.0% 153.1% 24.6% 31.7% 34.7% 7.2% (182.9%) 48.3% 41.3% 26.7% 45.2% (63.6%) 15.1% 16.0% 21.4% 34.7% 26.7% 21.4% 15.7% 14.7% 11.1%
EBITDA 52.7% 127.4% 23.7% 32.9% 35.8% 4.1% (133.0%) 46.6% 34.7% 24.0% 42.6% (185.3%) 15.8% 16.6% 22.3% 35.8% 24.0% 22.3% 15.5% 13.6% 10.6%
EPS 47.0% 211.9% 24.5% 30.6% 35.5% 6.3% (183.8%) 48.4% 41.6% 26.4% 45.8% (63.6%) 14.9% 15.7% 21.4% 35.5% 26.4% 21.4% 15.5% 14.4% 10.9%
Source: Company data, Credit Suisse estimates
Deckers Outdoor Corporation (DECK) 5
20 December 2011
Exhibit5: Brand Driver
Deckers Outdoor Corporation
Brand Driver
($ In Millions Except Per Share Data)
2010 2010 2011 2011E 2012 2012E 2010 2011E 2012E 2013E 2014E 2015E
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 2Q12 2Q12 3Q12 4Q12
MarA JunA SepA DecA MarA JunA SepA DecE MarE JunE SepE DecE
Geography
U.S. 117.0 65.2 204.7 377.1 764.1 148.1 82.8 257.9 462.0 950.8 173.3 95.2 290.1 512.8 1071.5 764.1 950.8 1071.5 1238.7 1325.4 1404.9
International 38.9 71.8 73.2 53.0 236.9 56.7 71.5 156.5 109.1 393.7 91.9 115.2 184.4 150.0 541.6 236.9 393.7 541.6 598.3 737.9 880.3
Brands
UGGWholesale 64.5 88.1 229.1 282.1 663.9 91.1 85.3 334.7 359.2 870.3 103.8 96.4 373.2 395.1 968.6 663.9 870.3 968.6 1061.6 1151.9 1232.5
UGGDirect 39.9 12.1 26.7 130.7 209.3 57.3 22.9 41.9 179.1 301.3 79.4 32.9 57.7 230.2 400.2 209.3 301.3 400.2 497.8 598.4 699.3
UGGEcommerce 16.9 2.5 6.8 58.4 84.6 22.1 3.0 7.7 67.1 99.8 26.5 3.6 9.0 78.8 117.9 84.6 99.8 117.9 138.0 161.4 188.9
UGGRetail Stores 22.9 9.6 19.8 72.3 124.7 35.3 20.0 34.3 112.0 201.5 52.9 29.3 48.7 151.3 282.2 124.7 201.5 282.2 359.8 437.0 510.5
Total UGGBrand 104.4 100.2 255.8 412.8 873.1 148.4 108.3 376.7 538.3 1171.7 183.2 129.3 430.9 625.3 1368.8 873.1 1171.7 1368.8 1559.4 1750.3 1931.8
0.0 0.0
Teva Wholesale 42.2 29.1 12.2 12.7 96.2 49.5 38.1 13.0 15.2 115.7 56.9 43.4 14.7 17.0 132.0 96.2 115.7 132.0 145.2 158.3 172.5
Teva Direct 0.9 2.1 1.5 0.6 5.1 0.9 2.2 1.7 0.7 5.6 1.0 2.4 1.9 0.8 6.1 5.1 5.6 6.1 6.5 6.9 7.2
Teva Ecommerce 0.9 2.1 1.3 0.6 4.8 0.9 2.1 1.4 0.6 5.0 0.9 2.2 1.5 0.7 5.3 4.8 5.0 5.3 5.6 5.8 6.0
Teva Retail Stores 0.0 0.0 0.2 0.0 0.3 0.1 0.1 0.3 0.1 0.6 0.1 0.2 0.4 0.1 0.7 0.3 0.6 0.7 0.9 1.0 1.2
Total Teva Brand 43.2 31.2 13.7 13.3 101.3 50.4 40.3 14.7 15.9 121.3 57.9 45.8 16.6 17.8 138.1 101.3 121.3 138.1 151.7 165.1 179.8
0.0 0.0
Other Wholesale 7.6 4.7 7.7 3.4 23.5 5.5 5.0 21.7 16.3 48.4 23.2 34.0 25.5 19.1 101.7 23.5 48.4 101.7 120.5 141.6 166.4
Simple Wholesale 4.0 2.7 3.8 1.8 12.3 3.1 2.3 2.7 1.1 9.2 0.0 0.0 0.0 0.0 0.0 12.3 9.2 0.0 0.0 0.0 0.0
Tsubo/Ahnu Wholesale 3.6 2.1 3.9 1.6 11.2 2.3 2.7 4.1 1.8 10.9 2.6 3.0 5.6 11.2 10.9 5.6 0.0 0.0 0.0
Sanuk Wholesale 0.0 14.8 13.4 28.2 20.6 31.0 17.8 15.9 85.3 0.0 28.2 85.3 0.0 0.0 0.0
Other Direct 0.8 0.9 0.7 0.7 3.0 0.6 0.7 1.3 0.6 3.2 0.8 1.3 1.6 0.8 4.5 3.0 3.2 4.5 5.4 6.3 7.2
Other Ecommerce 0.6 0.6 0.5 0.6 2.4 0.5 0.7 1.2 0.6 3.0 0.8 1.3 1.4 0.7 4.1 2.4 3.0 4.1 4.9 5.7 6.5
Simple Ecommerce 0.5 0.6 0.5 0.5 2.1 0.5 0.5 0.3 0.1 1.5 0.0 0.0 0.0 0.0 0.0 2.1 1.5 0.0 0.0 0.0 0.0
Tsubo/Ahnu Ecommerce 0.1 0.0 0.1 0.1 0.3 0.1 0.0 0.1 0.1 0.2 0.0 0.3 0.2 0.0 0.0 0.0 0.0
Sanuk Ecommerce 0.8 0.4 0.8 1.3 1.4 0.7 0.0 0.0 0.0 0.0 0.0 0.0
Other Retail Stores 0.2 0.3 0.2 0.0 0.6 0.0 0.1 0.1 0.0 0.3 0.1 0.1 0.2 0.1 0.4 0.6 0.3 0.4 0.5 0.6 0.7
Simple Retail 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Tsubo/Ahnu Retail 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Other Brands 8.4 5.6 8.4 4.1 26.5 6.0 5.7 23.0 16.9 51.6 24.1 35.3 27.0 19.8 106.2 26.5 51.6 106.2 126.0 147.9 173.7
0.0 0.0
Total Wholesale 114.4 121.9 249.1 298.2 783.5 146.0 128.4 369.4 390.7 1034.4 184.0 173.8 413.3 431.2 1202.3 783.5 1034.4 1202.3 1327.4 1451.8 1571.4
Total Consumer Direct 41.6 15.1 28.8 131.9 217.5 58.8 25.8 45.0 180.4 310.1 81.2 36.6 61.2 231.7 410.7 217.5 310.1 410.7 509.7 611.5 713.8
Ecommerce 18.4 5.2 8.7 59.5 91.8 23.5 5.7 10.3 68.3 107.8 28.2 7.0 11.9 80.2 127.3 91.8 107.8 127.3 148.5 172.9 201.4
Retail 23.1 10.0 20.2 72.4 125.6 35.4 20.1 34.7 112.1 202.3 53.1 29.6 49.3 151.5 283.4 125.6 202.3 283.4 361.2 438.7 512.4
Check 0.0 0.0 0.0 0.0 0.0 0.0
Total 155.9 137.1 277.9 430.1 1001.0 204.9 154.2 414.4 571.1 1344.5 265.2 210.4 474.5 662.9 1613.0 1001.0 1344.5 1613.0 1837.0 2063.3 2285.2
Y/Y Growth
Domestic 14.7% 16.2% 14.3% 22.1% 18.3% 26.6% 26.9% 26.0% 22.5% 24.4% 17.0% 15.0% 12.5% 11.0% 12.7% 18.3% 24.4% 12.7% 15.6% 7.0% 6.0%
International 20.8% 54.8% 48.2% 35.2% 41.7% 45.8% -0.5% 113.9% 105.9% 66.2% 62.0% 61.3% 17.9% 37.6% 37.6% 41.7% 66.2% 37.6% 10.5% 23.3% 19.3%
UGGWholesale 2.4% 32.3% 17.6% 16.3% 17.1% 41.2% -3.1% 46.1% 27.3% 31.1% 14.0% 13.0% 11.5% 10.0% 11.3% 17.1% 31.1% 11.3% 9.6% 8.5% 7.0%
UGGDirect 40.5% 55.1% 48.9% 43.9% 44.5% 43.8% 89.3% 57.3% 37.1% 44.0% 38.5% 43.5% 37.6% 28.5% 32.8% 44.5% 44.0% 32.8% 24.4% 20.2% 16.9%
UGGEcommerce 16.2% 18.7% 16.5% 31.3% 26.3% 30.4% 20.8% 12.3% 15.0% 18.0% 20.0% 20.0% 17.5% 17.5% 18.1% 26.3% 18.0% 18.1% 17.0% 17.0% 17.0%
UGGRetail Stores 66.2% 68.3% 64.7% 56.0% 60.0% 53.7% 106.8% 72.8% 54.9% 61.5% 50.0% 47.0% 42.1% 35.1% 40.1% 60.0% 61.5% 40.1% 27.5% 21.4% 16.8%
Total UGGBrand 14.2% 34.6% 20.2% 23.8% 22.7% 42.2% 8.0% 47.3% 30.4% 34.2% 23.5% 19.5% 14.4% 16.2% 16.8% 22.7% 34.2% 16.8% 13.9% 12.2% 10.4%
Teva Wholesale 21.9% 44.2% 67.0% 28.9% 33.7% 17.2% 30.9% 6.1% 20.0% 20.3% 15.0% 14.0% 13.0% 12.0% 14.1% 33.7% 20.3% 14.1% 10.0% 9.0% 9.0%
Teva Direct 0.4% -10.5% -14.2% -11.9% -10.0% -1.0% 4.0% 17.6% 12.3% 8.0% 9.1% 8.1% 10.6% 8.6% 9.1% -10.0% 8.0% 9.1% 6.8% 5.9% 5.8%
Teva Ecommerce 2.4% -5.9% -17.8% -9.5% -8.5% -4.5% 0.6% 10.0% 9.5% 3.2% 6.5% 6.5% 6.5% 6.5% 6.5% -8.5% 3.2% 6.5% 5.0% 4.0% 4.0%
Teva Retail Stores -29.8% -70.7% 29.5% -35.4% -28.3% 77.5% 151.0% 75.0% 50.0% 84.2% 40.0% 35.0% 30.0% 30.0% 32.4% -28.3% 84.2% 32.4% 20.0% 18.0% 16.0%
Total Teva Brand 21.4% 38.4% 51.7% 26.2% 30.5% 16.8% 29.1% 7.4% 19.6% 19.7% 14.9% 13.7% 12.7% 11.9% 13.8% 30.5% 19.7% 13.8% 9.9% 8.9% 8.9%
Other Wholesale 17.6% 8.0% 38.5% 6.2% 19.5% -28.5% 4.6% 181.5% 377.2% 106.0% 25.0% 20.0% 17.5% 17.0% 110.4% 19.5% 106.0% 110.4% 18.5% 17.5% 17.5%
Simple Wholesale 10.0% 12.0% 45.0% -5.0% -22.5% -15.0% -35.0% -40.0%
Tsubo/Ahnu Wholesale 27.4% 3.3% 32.8% 22.6% -35.2% -10.0% 5.0% 10.0% 11.5% 12.0% 12.0% 12.0%
Sanuk Wholesale 20.0% 18.5%
Other Direct -5.9% -24.3% -35.2% -31.0% -25.1% -26.0% -21.9% 90.8% -2.5% 7.4% 43.1% 88.3% 19.3% 18.0% 38.1% -25.1% 7.4% 38.1% 20.8% 15.9% 15.5%
Other Ecommerce -19.3% -34.8% -40.5% -23.4% -30.3% -12.2% 1.4% 123.1% -2.0% 24.7% 44.2% 92.0% 15.6% 15.4% 37.2% -30.3% 24.7% 37.2% 20.0% 15.0% 15.0%
Simple Ecommerce -20.0% -35.0% -42.0% -24.0% -31.1% -14.0% -14.0% -25.0% -75.0% -31.8% -31.1% -31.8% 0.0% 0.0% 0.0% 0.0%
Tsubo/Ahnu Ecommerce -12.8% -31.0% -29.6% -19.0% -23.4% 4.6% -80.5% 15.0% 15.0% -21.0% -10.0% 5.0% 10.0% 10.0% -23.4% -21.0% 0.0% 0.0% 0.0% 0.0%
Other Retail Stores 125.3% 26.1% -7.1% -72.3% 4.7% -74.6% -80.5% -20.0% -10.0% -58.9% 30.0% 40.0% 55.0% 60.0% 48.6% 4.7% -58.9% 48.6% 30.0% 25.0% 20.0%
Total Other Brands 15.0% 1.1% 26.5% -2.3% 11.9% -28.3% 0.4% 173.9% 315.7% 94.8% 299.9% 523.2% 17.6% 17.0% 105.8% 11.9% 94.8% 105.8% 18.6% 17.4% 17.4%
Total Wholesale 9.9% 33.7% 19.9% 16.7% 19.0% 27.7% 5.3% 48.3% 31.0% 32.0% 26.0% 35.4% 11.9% 10.4% 16.2% 19.0% 32.0% 16.2% 10.4% 9.4% 8.2%
Total Consumer Direct 38.0% 33.1% 39.3% 42.7% 40.6% 41.5% 70.7% 56.1% 36.8% 42.6% 38.1% 41.7% 36.0% 28.4% 32.5% 40.6% 42.6% 32.5% 24.1% 20.0% 16.7%
Ecommerce 13.8% -1.6% 3.8% 29.8% 21.3% 27.3% 10.3% 18.9% 14.8% 17.4% 20.0% 23.3% 15.8% 17.4% 18.1% 21.3% 17.4% 18.1% 16.6% 16.4% 16.5%
Retail 66.1% 63.1% 63.3% 55.4% 59.1% 52.8% 102.2% 72.1% 54.8% 61.0% 50.0% 46.9% 42.0% 35.1% 40.1% 59.1% 61.0% 40.1% 27.5% 21.4% 16.8%
Total 16.2% 33.7% 21.7% 23.6% 23.1% 31.4% 12.5% 49.1% 32.8% 34.3% 29.5% 36.4% 14.5% 16.1% 20.0% 23.1% 34.3% 20.0% 13.9% 12.3% 10.8%
% Total
Wholesale 73.3% 89.0% 89.6% 69.3% 78.3% 71.3% 83.3% 89.1% 68.4% 76.9% 69.4% 82.6% 87.1% 65.0% 74.5% 78.3% 76.9% 74.5% 72.3% 70.4% 68.8%
Direct-to-Consumer 26.7% 11.0% 10.4% 30.7% 21.7% 28.7% 16.7% 10.9% 31.6% 23.1% 30.6% 17.4% 12.9% 35.0% 25.5% 21.7% 23.1% 25.5% 27.7% 29.6% 31.2%
eCommerce 11.8% 3.8% 3.1% 13.8% 9.2% 11.5% 3.7% 2.5% 12.0% 8.0% 10.6% 3.3% 2.5% 12.1% 7.9% 9.2% 8.0% 7.9% 8.1% 8.4% 8.8%
Retail 14.8% 7.3% 7.3% 16.8% 12.6% 17.3% 13.0% 8.4% 19.6% 15.0% 20.0% 14.0% 10.4% 22.9% 17.6% 12.6% 15.0% 17.6% 19.7% 21.3% 22.4%
Domestic 75.0% 47.6% 73.7% 87.7% 76.3% 72.3% 53.7% 62.2% 80.9% 70.7% 65.3% 45.2% 61.1% 77.4% 66.4% 76.3% 70.7% 66.4% 67.4% 64.2% 61.5%
International 25.0% 52.4% 26.3% 12.3% 23.7% 27.7% 46.3% 37.8% 19.1% 29.3% 34.7% 54.8% 38.9% 22.6% 33.6% 23.7% 29.3% 33.6% 32.6% 35.8% 38.5%
Source: Company data, Credit Suisse estimates
Deckers Outdoor Corporation (DECK) 6
20 December 2011
Exhibit 6: Retail Driver
Deckers Outdoor Corporation
Retail Driver
($ In Millions Except Per Share Data)
2010 2010 2011 2011E 2012 2012E 2010 2011E 2012E 2013E 2014E 2015E
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 2Q12 2Q12 3Q12 4Q12
MarA JunA SepA DecA MarA JunA SepA DecE MarE JunE SepE DecE
Retail Sales $23.1 $10.0 $20.2 $72.4 125.6 $35.4 $20.1 $34.7 $112.1 202.3 $53.1 $29.6 $49.3 $151.5 283.4 125.6 202.3 283.4 361.2 438.7 512.4
Retail Comps 28.2% 19.2% 17.9% 11.6% 16.1% 2.6% 23.6% 15.4% 11.5% 11.4% 10.0% 9.0% 8.0% 7.0% 7.9% 16.1% 11.4% 7.9% 6.5% 5.0% 4.0%
Comp Store Sales 17.9 7.3 14.6 52.0 91.7 23.7 12.3 23.3 80.7 140.0 38.9 21.9 37.5 119.9 218.2 91.7 140.0 218.2 301.8 379.2 456.2
New Store Sales 5.3 2.7 5.6 20.4 34.0 11.6 7.8 11.4 31.4 62.2 14.1 7.6 11.8 31.5 65.1 34.0 62.2 65.1 59.4 59.4 56.2
Sales/New Store 1.06 0.54 0.70 2.27 3.8 1.29 0.71 0.88 1.85 3.7 0.79 0.42 0.62 1.66 3.4 3.8 3.7 3.4 2.6 2.4 2.2
New Store Productivity 99% 118% 85% 83% 74.1% 100% 132% 94% 65% 65.6% 60% 60% 60% 60% 60.2% 74.1% 65.6% 60.2% 48.8% 49.0% 50.5%
Sales/Average Store 1.29 0.54 0.94 2.84 5.6 1.31 0.71 1.04 2.77 5.7 1.19 0.64 0.95 2.55 5.3 5.6 5.7 5.3 4.8 4.5 4.1
Stores (BOP) 18 18 19 24 18 27 27 30 37 27 44 45 48 56 44 18 27 44 63 86 111
Opened Stores 0 1 5 3 9 0 3 7 7 17 1 3 8 7 19 9 17 19 23 25 25
Closed Stores 0 0 0 0 0 0
Stores (EOP) 18 19 24 27 27 27 30 37 44 44 45 48 56 63 63 27 44 63 86 111 136
9 17
Opened Stores (Yoy) 5 5 8 9 9 9 11 13 17 17 18 18 19 19 19 9 17 19 23 25 25
Source: Company data, Credit Suisse estimates
Exhibit7: Balance Sheet
Deckers Outdoor Corporation
Balance Sheet
($ In Millions Except Per Share Data)
2010 2010 2011 2011E 2012 2012E 2010 2011E 2012E 2013E 2014E 2015E
1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 2Q12 2Q12 3Q12 4Q12
MarA JunA SepA DecA MarA JunA SepA DecE MarE JunE SepE DecE
Assets
Current Assets:
Cash & Cash Equivalents 357.5 333.7 250.5 445.2 445.2 437.9 325.2 90.4 243.9 243.9 174.8 50.0 50.0 264.2 264.2 445.2 243.9 264.2 309.6 354.2 160.6
Short Term Investments 0.0 0.2 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 50.0 100.0 100.0 100.0 0.0 0.0 100.0 200.0 300.0 350.0
Inventories 68.8 120.5 197.3 125.0 125.0 107.1 210.0 356.9 202.1 202.1 138.7 285.3 406.7 233.0 233.0 125.0 202.1 233.0 264.5 295.2 324.3
Receivables 54.6 81.6 142.2 116.7 116.7 78.2 107.0 227.7 165.0 165.0 101.3 145.9 260.7 191.5 191.5 116.7 165.0 191.5 219.1 247.0 274.0
Refundable And Deferred Tax Asset 9.7 6.7 7.9 16.8 16.8 19.5 28.3 62.4 62.4 62.4 62.4 62.4 62.4 62.4 62.4 16.8 62.4 62.4 62.4 62.4 62.4
Prepaid Expenses And Other Current 7.4 9.7 9.7 12.0 12.0 12.0 21.3 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0 12.0
Total Current Assets 498.0 552.5 607.9 715.7 715.7 654.7 691.7 749.4 685.4 685.4 489.2 605.6 891.9 863.1 863.1 715.7 685.4 863.1 1067.6 1270.9 1183.3
Property And Equipment, Net 36.1 37.4 42.9 47.7 47.7 49.6 54.5 59.1 71.6 71.6 78.6 83.6 81.0 77.0 77.0 47.7 71.6 77.0 69.1 59.3 50.5
Restricted Cash 0.2 0.3 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Intangible Assets, Net 26.0 25.4 25.2 24.9 24.9 26.5 23.9 211.9 211.9 211.9 211.9 211.9 211.9 211.9 211.9 24.9 211.9 211.9 211.9 211.9 211.9
Deferred Tax Asset 16.7 16.7 16.7 15.1 15.1 15.1 16.7 16.4 16.4 16.4 16.4 16.4 16.4 16.4 16.4 15.1 16.4 16.4 16.4 16.4 16.4
Other Assets 1.9 2.3 4.2 5.5 5.5 8.1 8.3 9.0 9.0 9.0 9.0 9.0 9.0 9.0 9.0 5.5 9.0 9.0 9.0 9.0 9.0
Total Assets 578.9 634.5 697.2 809.0 809.0 753.9 795.1 1045.7 994.2 994.2 805.1 926.5 1210.2 1177.4 1177.4 809.0 994.2 1177.4 1373.9 1567.4 1471.1
Liabilities
Current Liabilities:
Notes Payable And Current On Lt Deb 0.0 0.0 0.0 0.0 0.0 0.0 0.0 45.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Account Payable 29.5 80.0 73.2 67.1 67.1 43.0 107.4 132.2 95.3 95.3 55.7 145.8 150.7 109.9 109.9 67.1 95.3 109.9 124.7 139.2 152.9
Accrued Expenses 20.4 18.9 30.5 52.6 52.6 25.4 25.1 77.8 69.9 69.9 32.9 34.3 89.0 81.1 81.1 52.6 69.9 81.1 92.8 104.6 116.1
Income Tax Payable 10.0 5.8 23.1 25.2 25.2 0.4 0.6 5.8 5.8 5.8 5.8 5.8 5.8 5.8 5.8 25.2 5.8 5.8 5.8 5.8 5.8
Reserve For Return 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
0.0 0.0 0.0 0.0 0.0 0.0
Total Current Liabilities 59.9 104.7 126.8 144.9 144.9 68.8 133.1 260.8 171.0 171.0 94.5 185.9 245.5 196.8 196.8 144.9 171.0 196.8 223.3 249.6 274.7
Deferred Tax Liability 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Long-Term Liabilities 5.8 6.9 8.1 8.5 8.5 9.9 10.0 66.6 66.6 66.6 66.6 66.6 66.6 66.6 66.6 8.5 66.6 66.6 66.6 66.6 66.6
Minority Interest 0.0 0.0 0.0 2.7 2.7 2.7 3.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 2.7 0.0 0.0 0.0 0.0 0.0
Shareholders Equity
Total Shareholders Equity 513.2 523.0 562.3 653.0 653.0 672.5 648.9 718.3 756.7 756.7 644.0 673.9 898.0 914.0 914.0 653.0 756.7 914.0 1084.0 1251.2 1129.7
Total Liabilities 578.9 634.5 697.2 809.0 809.0 753.9 795.1 1045.7 994.2 994.2 805.1 926.5 1210.2 1177.4 1177.4 809.0 994.2 1177.4 1373.9 1567.4 1471.1
Operating Metrics
Receivable Turnover Ratio 9.5 8.0 9.9 13.3 10.4 8.4 6.7 9.9 11.6 9.5 8.0 6.8 9.3 11.7 9.1 10.4 9.5 9.1 8.9 8.9 8.8
Days Sales Outstanding 31.5 53.6 46.1 24.4 35.2 34.4 62.4 49.5 26.0 38.2 34.4 62.4 49.5 26.0 40.3 35.2 38.2 40.3 40.8 41.2 41.6
Payable Turnover Ratio 8.1 5.6 7.7 11.2 8.7 7.4 4.7 7.1 9.1 8.2 7.0 4.8 6.5 9.2 7.7 8.7 8.2 7.7 7.6 7.6 7.5
Days Payable Outstanding 34.0 94.3 44.8 30.7 41.9 37.8 109.4 56.3 33.0 44.8 37.8 109.4 56.3 33.0 47.2 41.9 44.8 47.2 47.7 48.3 48.7
Inventory Turnover 4.0 3.2 3.7 4.9 4.7 3.5 2.2 3.0 3.7 4.0 3.1 2.3 2.8 3.7 3.6 4.7 4.0 3.6 3.6 3.6 3.5
Days Inventory (Forwards) 81.2 73.8 90.2 109.9 109.2 89.4 123.6 137.2 104.1 106.5 122.2
Days Inventory (Backwards) 79.4 142.1 120.9 57.2 77.1 94.2 214.1 151.9 70.0 90.2 94.2 214.1 151.9 70.0 100.1 77.1 90.2 100.1 101.3 102.4 103.3
Cash Cycle (Days) 76.9 101.4 122.1 50.9 70.4 90.7 167.0 145.1 63.0 83.6 90.7 167.0 145.1 63.0 93.2 70.4 83.6 93.2 94.3 95.3 96.2
Source: Company data, Credit Suisse estimates
Companies Mentioned (Price as of 19 Dec 11)
Deckers Outdoor Corporation (DECK, $101.70, OUTPERFORM, TP $127.00)
Disclosure Appendix
Important Global Disclosures
I, Christian Buss, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and
securities and (2) no part of my compensation was, is or will be directly or indirectly related to the specific recommendations or views expressed in
this report.
See the Companies Mentioned section for full company names.
Deckers Outdoor Corporation (DECK) 7
20 December 2011
3-Year Price, Target Price and Rating Change History Chart for DECK
DECK Closing Target 127
122
Price Price Initiation/
112 110
Date (US$) (US$) Rating Assumption
3/26/09 19.23 15 U X 92 NC O
10/23/09 32.393 16.667
2/26/10 40.067 30 72
4/23/10 52.403 41.667 60
7/23/10 48.65 50 N 52 50 N
10/29/10 58.1 60 42
2/24/11 89.8 NC 32 30
9/7/11 90.57 110 O X US$ 26-Mar-09
15
U 17 7-Sep-11
12
10/28/11 117.66 122
12/6/11 106.18 127
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Closing Price Target Price Initiation/Assumption Rating
O=Outperform; N=Neutral; U=Underperform; R=Restricted; NR=Not Rated; NC=Not Covered
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Deckers Outdoor Corporation (DECK) 8
20 December 2011
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See the Companies Mentioned section for full company names.
Price Target: (12 months) for (DECK)
Method: Our $127 target price for DECK is based on an 20x multiple on our 2012 EPS estimate. We arrived at this valuation after considering our
analysis of the following: (1) peer group multiples ($124TP), (2) a downside scenario ($82TP); (3) a five-year DCF ($128TP), and (4) a long-term
growth model ($133TP.)
Risks: Key risks to our $127 TP on DECK include changes in the popularity of the UGG brand, macroeconomic slowdown, foreign currency
flactuations, possible conflicts with international distributors, and accounting risk related to the capitalization of retail leases.
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Deckers Outdoor Corporation (DECK) 9
20 December 2011
Americas/United States
Equity Research
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