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Published in Economic Development

Wolverine withdraws 2020 guidance citing uncertainty, volatility due to coronavirus

BY Thursday, March 19, 2020 10:08am

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ROCKFORD — Citing “heightened uncertainty and recent volatility” related to the coronavirus, footwear and apparel marketer Wolverine World Wide Inc. says it is withdrawing its previous guidance for the 2020 fiscal year.

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In the last paragraph of a statement this morning touting the company’s liquidity and supply chain stability, Wolverine said it was backing away from guidance issued Feb. 25 in which it expected revenues to grow to $2.29 billion to $2.34 billion for the year. 

The previously issued guidance had included consideration of the effects of the coronavirus in the first half of the year. 

In a filing with securities regulators, Wolverine said withdrawing its guidance was necessary “due to the heightened uncertainty relating to the potential impact of COVID-19 on the Company’s operations, including its duration and effect on overall customer demand and the Company’s supply chain.”

Wolverine now says it expects to discuss the issue more when it issues its first quarter earnings report, which is likely to occur during the second week of May. 

The company also said that it closed its 90 retail stores at least through March 27. Collectively, the brick and mortar retail locations generate less than $100 million in revenue annually. Wolverine said its e-commerce business remains fully operational. 

“As a company we are well positioned to weather the current challenges and accelerate the execution of our Global Growth Agenda as conditions improve globally,” Chairman, CEO and President Blake Krueger said in a statement. “We are fortunate to have a disciplined operating model and a strong balance sheet that positions us well to navigate the rapidly changing conditions. As the market stabilizes, we will be ready to capitalize on the power of our brands and operating platform to service our global customers and consumers.”

According to a statement, Wolverine’s supply chain is operating “at near full capacity,” while logistics and distributions centers are “at full strength.” The company is prioritizing closely managing its inventory and working capital during the coronavirus pandemic. 

“During this time of uncertainty, we are implementing significant measures to further strengthen our balance sheet and enhance liquidity,” Senior Vice President and CFO Mike Stornant said in a statement. “We are acting quickly and believe this proactive approach will benefit us in the short- and long-term. We expect to continue to have financial flexibility to support the Company’s operations now and into the future.”

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