Deckers Outdoor Earnings Call Nuggets: Weather Uncertainties and U.S. Wholesale Business

Deckers Outdoor Corporation (NASDAQ:DECK) recently reported its fourth quarter earnings and discussed the following topics in its earnings conference call.

Weather Uncertainties

Randal Konik – Jefferies: I guess questions for Tom. Tom, you gave a very interesting statement regarding your top line assumptions for 2013. You said that 7% outlook growth includes a similar winter kind of assumption to this year. Now to clarify, does that kind of incorporate similar amounts of closeouts, similar amounts of at once pre-book et cetera. How should we be thinking about that there, because the way it kind of looks to me is that the probability would increase in year three, that the winter should theoretically could get better? And then second, we have almost likely a car analogy here where almost women haven’t been buying UGGs for two years of the replacement cycle could actually get better in year three here. So just trying to get a level of what should we be thinking in that similar winter comment regarding the top line, how should we be thinking about that? That’s my first question and then I have a follow-up. Thanks.

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Angel R. Martinez – Chairman, CEO and President: Yeah, Randy, what we’ve assumed in the guidance, we are pretty cautions here in light of the uncertainty around the weather. So we’ve really assumed minimal reorders similar to what we experienced in 2012, i.e., minimal reorders and we’ve assumed similar cancellations that we received in 2012, and we received a fair amount of cancellations relatively large amount relative to our historical pattern for cancellation. So that’s the assumptions that we put into it. At this point in time we run a pre-booking process, we want to make sure we were cautious on our domestic wholesale business and…

Angel R. Martinez – Chairman, CEO and President: This is Angel. I think the replenishment component is something to keep in mind. We are the number one – in terms of footwear gifted items at the holidays, and we saw with the onset of colder weather people did Russia to replace some of the UGG product primarily it was a lot of slippers a lot of the new styles. Some of the classic products does not affect in the daily beast that is always there was an article on the resurgence of UGG Classic. So, that’s I would go where we when, I don’t think that we when, but people are rediscovering, and so that as well. It just still right now consumers are challenged by the multiple opportunities that have the byproduct, not just in retail environments, wholesale environments, but in online et cetera. So, we are sort of try and evaluate all that stuff in our assumptions.