K•Swiss Inc. reports Q3 earnings above estimates

Athletic footwear company K•Swiss Inc. (Nasdaq: KSWS) today reported third-quarter earnings above estimates, and issued fourth-quarter and full-year guidance. 

For the three months ended Sept. 30, the small cap recorded net income of $12.8 million, or $0.36 per diluted share, above the 0.34 per share seven analysts surveyed by Thomson Financial were on average forecasting. For the same period last year, the company earned $20.95 million, or $0.59 per diluted share.

Net earnings include a one-time other income item of $5.23 million, or $0.12 per diluted share, which consists of a reversal of an estimate of the underpayment of payroll withholding liabilities in a foreign jurisdiction from Jan. 1, 1993 through Dec. 31, 2005.

Revenues were $107.25 million, compared with $133.14 million for the third quarter of 2006. Six analysts surveyed by Thomson Financial were on average estimating revenues of $117.58 million.

K•Swiss also issued guidance for the fourth quarter of 2007 and full-year 2007. The company said it expects revenues for the fourth quarter to be approximately $73 million to $81 million and earnings per diluted share to be in the range of $0.00 to $0.09. The consensus of six analysts surveyed by Thomson Financial was for earnings of $0.16 per share on revenues of $79.92 million.

For the full year, the company said it anticipates full-year earnings per share of approximately $1.08 to $1.17 on full-year revenues of approximately $405 million to $413 million.

Seven analysts polled by Thomson are on average forecasting earnings of $1.22 per share for the full year on revenues of $421.87 million.

K•Swiss said its estimates for the fourth quarter and full-year 2007 reflect a significant decline in domestic revenues, substantial investments in product development and marketing for the K•Swiss brand, continued expansion of international operations and continued investment in the Royal Elastics brand.

Shares of K•Swiss (KSWS) were halted in pre-market trading.

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