Global Business Update and Q3 Financial Results
NON-GAAP RECONCILIATION
Non-GAAP cost of sales, gross profit, and gross margin reconciliation:
Non-GAAP selling, general and administrative expenses reconciliation:
Three Months Ended September 30,
2020
2019
2020
Nine Months Ended September 30,
2019
Three Months Ended September 30, Nine Months Ended September 30.
2020
GAAP revenues
$
361,736 $
(in thousands)
312,766 $
974,445 $
967,614
GAAP revenues
2019
2020
$
361,736
$
(in thousands)
312,766 $
974,445
2019
967,614
New distribution centers (1)
GAAP cost of sales
COVID-19 inventory write-off (2)
$
154,967
(897)
$
148,942
453,581 $
(3,678)
(2,636)
476,796
(7,981)
GAAP selling, general and administrative
expenses
(2,396)
Donations of inventory
134,683
(50)
$
123,940
$
371,371 $
370,525
(9,970)
COVID-19 severance costs
Other
Total adjustments
Non-GAAP cost of sales
$
(119)
(1,016)
153,951
$
(42)
(3,720)
145,222
(119)
(175)
(2,403)
(5,151)
(8,156)
COVID-19 impact of bad debt
(1)
expense
48
(4,433)
Other COVID-19 costs (2)
$
(183)
(827)
448,430 $
468,640
Duplicate headquarters rent (3)
(426)
(1,120)
GAAP gross profit
$
GAAP gross margin
206,769 $
57.2%
163,824 $
52.4 %
520,864 $
53.5%
490,818
50.7%
Non-recurring expenses associated with
cost reduction initiatives in 2019
Other (4)
(809)
(1,698)
Total adjustments
(1,652)
(2,263)
(809)
(2,133)
(20,886)
(1,698)
Non-GAAP gross profit
Non-GAAP gross margin
207,785 $
57.4%
167,544
53.6 %
$
526,015
54.0%
$
498,974
51.69
Non-GAAP selling, general and
administrative expenses (5)
$
132,420
$
123,131
$
350,485
$
368,827
(2)
(1) Represents expenses, including expansion costs, related to our distribution centers in Dayton, Ohio and Dordrecht, the Netherlands.
Represents an inventory write-off in our Asia Pacific segment associated with the impact of COVID-19.
GAAP selling, general and administrative
crocs™
expenses as a percent of revenues
37.2 %
39.6 %
38.1 %
38.3
Non-GAAP selling, general and
administrative expenses as a percent of
revenues
36.6%
39.4 %
36.0 %
38.1
(1) Represents bad debt expense associated with the impact of COVID-19 on wholesale partners in our Asia Pacific and Americas segments.
(2) Represents costs incurred in response to the COVID-19, including hazard pay, cleaning costs, and legal costs.
(3) Represents ongoing duplicate rent costs associated with our move to our new headquarters in Broomfield, Colorado, while we conclude the
lease for our former headquarters in Niwot, Colorado.
(4) Represents non-recoverable duties, non-recurring costs related to the closure of company-owned retail stores in Australia, employee
severance costs, and various other immaterial items.
(5) Non-GAAP selling, general and administrative expenses are presented gross of tax.
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