Athletic Footwear

K-Swiss, Inc.

K-Swiss <% if gsSubBrand = "aolsnapshot" then Response.Write("(Nasdaq: KSWS)") else Response.Write("(Nasdaq: KSWS)") end if %>, which was the first company to market a leather tennis shoe, is looking somewhat hapless these days. The company's "class" brand has changed little over the years and has cultivated a core following, but the mass market has never really taken to the rather bland product portfolio and incremental growth strategy of the company. Revenues have descended from $153 million in 1994 to $106 million in 1996, and 1997 is turning out to be a flat year. While the company has been able to improve gross margins above last year's levels, pricing is still subject to pressures from competition, the vagaries of taste, and sales volumes. Analysts are estimating 70% EPS growth in 1998, but that looks difficult unless sales increase markedly.

Latest Financials

K-Swiss announced a second quarter net loss of $379,000 for the quarter ended June 30, 1997. Net earnings for the six months ended June 30, 1997 of $1,160,000 represented a decrease of 16.9% from the six months ended June 30, 1996. Revenues for the quarter increased 9.2% to $28,415,000 from the quarter ended June 30, 1996.

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