[caption id="attachment_84797" align="aligncenter" width="720"] Source: Company reports/Coresight Research[/caption]   1Q19 Results Skechers reported first-quarter 2019 EPS of $0.71, down 5.3% year over year and missing the consensus estimate of $0.73. 1Q19 sales increased 2.1% (up 5.3% on a currency-neutral basis) to $1.28 billion, missing the $1.30 billion consensus estimate. Skechers’ company-owned global retail business grew 6.7%.  Its international wholesales business increased 8.7%; however, its domestic wholesale business declined 10.9%. On a constant-currency basis, the company’s international business grew 15.0%, partially offsetting the 6.3% decline in the domestic business. Comparable same-store sales were up 0.7% in company-owned retail stores and e-commerce during the quarter, missing the consensus estimate of 0.8%. US comps grew 0.2% and international comps increased 2.3%, excluding the 61 stores recently acquired from a third-party in India. The gross margin declined 40 basis points to 46.3%, missing the 47.0% consensus estimate. The company improved its domestic margin but was hurt by lower international margins. Foreign currency exchange rates also had a negative impact. SG&A expense as a percentage of sales fell 150 basis points to 33.7%. SG&A expenses decreased 2.3% to $429.8 million but general and administrative expenses increased $4.2 million. The company also received a performance-based rebate of $15.8 million from the Chinese government. The company reported earnings from operations of $165.9 million, up 11.5% year over year. The operating margin expanded 110 basis points to 13.0%, beating the consensus estimate of 12.2%. In the first quarter, total inventory decreased $122.4 million to $740.9 million. Outlook The company offered the following guidance for 2Q19:

• Sales from $1.200 billion to $1.225 billion.
• EPS from $0.30 to $0.35.