Footwear Insight

6 • Footwear Insight ~ March/April 2023 footwearinsight.com D SW parent Designer Brands continues to expand its portfolio of owned brands. Its in-house lineup of casual and athleisure brands already included Topo Athletic and Le Tigre, acquired last year. en, in February Designer Brands added to its stable, acquiring Keds from Wolverine Worldwide for $83.6 million cash in a deal that also included Keds' e-commerce business and the Pro-Keds athleisure label. And in a separate transaction with Wolverine, Designer Brands obtained an exclusive license for the Hush Puppies footwear brand in the U.S. and Canada. "Our growing strength in owned brands is evident, given that 12 months ago, the athleisure category was a massive white space opportunity for us, and now we control high-quality brands across multiple price points," Doug Howe, incoming DSW president and CEO, said in a statement. e Keds acquisition also marks Designer Brands' first Owned Brand wholesale business within the kids footwear segment. Howe described Keds as "an iconic brand with broad appeal for our customers and their families." For Wolverine, the sale of Keds and the licensing out of Hush Puppies is another step in the company's stated strategy of simplifying its portfolio and prioritizing its growth brands. — Bob McGee C rocs CEO Andrew Rees recently told analysts that the company's acquisition of the Heydude footwear brand nearly a year ago is "exceeding expectations" as it begins implementing a growth plan for the Heydude business, which accounted for 27 percent of Crocs' FY22 revenues on a pro forma basis or approximately $959.8 million. Heydude, which also delivered $275 million in annual adjusted operating income for the company, realized 58 percent growth in digital sales to represent about $363 million (37.8%) last year. In FY22, Crocs increased the Heydude staff by more than 150 positions, expanded the brand's manufacturing footprint, grew its distribution base, and spent almost $60 million in H2 marketing the brand. e addition of Heydude is enabling Crocs to access an addressable, global market of approximately $160 billion, four times larger than the company's target audience previously. In Q4, Heydude sales rose 36.6 percent year-over-year to $279 million with digital accounting for nearly 52 percent of revenues. Overall, FY22 revenues for Crocs Inc. increased by 54 percent in FY22 to a record $3.55 billion. Annual North American revenues rose by 6 percent on a constant currency basis to $1,644.6 million. Crocs is forecasting 10 to 13 percent revenue expansion in FY23 to between $3.9 to $4.0 billion with Heydude sales expected to increase in the mid-20 percent range. — Bob McGee Designer Brands Snaps Up Keds Heydude Exceeding Expectations ACQUISITION BUSINESS THE FOOTWEAR EYE Wolverine sold the Keds brand to DSW's parent company. Casual brand Heydude is growing under Crocs' ownership.

• Cover