Yeti exceeded expectations in the third quarter as sales increased in each of its divisions and earnings gained on a reported and adjusted basis.
A Yahoo Finance-published analyst consensus estimate called for adjusted diluted earnings per share of 67 cents and revenues of $471.3 million.
Sales increased to $478.4 million from $433.6 million during the year-earlier quarter, including $2.7 million and $6.3 million, respectively, related to gift card redemptions in connection with recall remedies, Yeti noted. Direct-to-consumer sales gained to $280.8 million from $259.5 million year over year due to growth in both Coolers & Equipment and Drinkware segments. Drinkware sales increased to $275 million from $253.3 million year over year, driven by the continued expansion and innovation in Drinkware product offerings and new seasonal colorways. Coolers & Equipment sales rose to $192.6 million from $171.5 million year over year, driven by greater bag, hard cooler and outdoor living product revenue. Also, Wholesale channel sales advanced to $197.6 million from $174.1 million year over year due to growth in both Drinkware and Coolers & Equipment.
Operating income was $69.6 million versus $61.9 million in the year-prior quarter, as adjusted operating income came in at $79.2 million versus $71.4 million.
In announcing the financial results, Matt Reintjes, Yeti president and CEO, said, “Our positive momentum continued in the third quarter, with strong performance across our product portfolio and robust growth in our international business. We saw healthy demand across our major sales channels, driven by the continued successful execution of our strategic priorities. Our gross margins continued to expand despite a choppy macro environment, enabling us to continue to invest in our business while delivering strong earnings growth. Our supply chain diversification efforts remain on track, with production commencing at our second drinkware facility outside of China during the quarter. Finally, we continue to build on our strong cash position, which provides us the opportunity to further invest in the business while also pursuing a combination of strategic acquisitions and share repurchases.”
When it came to support of the Yeti brand, Reintjes said: “We drove strong brand engagement in the quarter, with over 100 global events across our broad and growing enthusiast communities. These are exciting programs and partnerships that are uniquely Yeti and showcase our product breadth and brand reach. On the product side, we continued to release new innovations, with several highly anticipated launches that reinforced our commitment to our drinkware category through our expansion in bar and tableware as well as our entry into the premium cookware market. In regards to our global business, our brand and customer base continue to grow, leading to a fourth consecutive quarter of over 30% sales growth outside the United States.”
