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K-Swiss Reports U. S. Orders Down for 6 Months

October 19, 1999|BARBARA MURPHY

K-Swiss Inc. in Westlake Village said U. S. retailers have ordered fewer of its athletic shoes for the next six months.

While orders for the fourth quarter rose 44%, those for the following quarter fell 21%, company officials said. Retailers have been cautious about adding inventory since Just For Feet, the No. 2 athletic-shoe seller, said it is cutting prices and returning orders to get rid of more than $50 million in excess products.

As a result, demand for K-Swiss' new training shoe and other footwear was lower than expected, analysts said. K-Swiss blamed the decline in orders on uncertainty by some retailers about a "promotional selling environment."

Venator Group's Foot Locker and other chains last year accounted for more than one-quarter of K-Swiss sales. No other U. S. customer accounted for more than 10% of revenue, according to the company's annual report.

Total orders for shoes to be shipped from October to March fell to $113.1 million from $113.8 million in the year-ago period, the company said.

The decline in orders overshadowed K-Swiss' announcement that it will beat third-quarter profit forecasts.

The company expects earnings of 70 to 80 cents a share on about $80 million in sales. K-Swiss was expected to earn 65 cents. In the year-ago quarter, it earned 26 cents on $38 million in revenue.

K-Swiss sales have increased in eight of the last nine quarters as more consumers bought niche brands in athletic footwear.

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