Deckers books $46m of IEEPA tariff refunds and lifts its full-year earnings guidance to $7.80 to $7.95 a share

Tariff money is coming back. Deckers Brands, the owner of HOKA and UGG, received $46.0m of net refunds of tariffs collected under the International Emergency Economic Powers Act in its fiscal second quarter, plus $3.0m of interest, according to results filed with the SEC after the close on Thursday. The company booked the refunds as a reduction in cost of sales and put their value at about 28 cents of diluted earnings a share.

Net sales for the quarter ended September 30 rose 3.5 percent to a record $1.481bn from $1.431bn. HOKA sales rose 6.8 percent to $677.2m and UGG sales 3.5 percent to $786.4m. Diluted earnings were $2.31 a share against $1.82, and gross margin widened to 60.5 percent from 56.2 percent, with the refunds supplying about 3.1 percentage points of that. Domestic sales slipped 0.4 percent while international sales rose 9.0 percent.

Through October 8 the refunds total $87.9m plus $4.7m of interest. Deckers now guides to full-year diluted earnings of $7.80 to $7.95 a share on sales of $5.700bn to $5.725bn. That outlook includes the refunds already received, worth about 52 cents a share, and assumes no further collections.