Consolidated financial performance highlights of fiscal year 2022 compared to the prior period, are as follows:

Trends and Uncertainties Impacting Our Business and Industry

We expect our business and the industry in which we operate will continue to be impacted by several important trends and uncertainties, including the following:

We believe demand for UGG brand products will continue to be driven by the following:

We believe demand for HOKA brand products will continue to be driven by the following:

Table of Contents We believe demand for Teva brand products will continue to be driven by the following:

We believe demand for Sanuk brand products will continue to be driven by the following:

•Introducing a broader and more premium range of product, including through category extensions in casual footwear for the younger consumer, including slippers and boots.

We believe demand for Koolaburra brand products will continue to be driven by the following:

•Increasing brand awareness with younger consumers. •Evolution of key franchises and further expansion in fashion casual boots, sneakers, and slippers.

Direct-to-Consumer. Our DTC business encompasses all our brands and is comprised of our retail stores and e-commerce websites which, in an omni-channel marketplace, are intertwined and interdependent. We believe many of our consumers interact with both our retail stores and websites before making purchasing decisions in store and online.

Use of Non-GAAP Financial Measures

Year Ended March 31, 2022, Compared to Year Ended March 31, 2021. Results of operations were as follows:

Net Sales. Net sales by location, and by brand and channel were as follows:

Net sales by brand and channel

Selling, General, and Administrative Expenses. The net increase in SG&A expenses, compared to the prior period, was primarily the result of the following:

•Increased other variable net selling expenses of approximately $48,700, primarily due to higher warehousing fees, shipping supplies, and retail operating costs, as well as higher net insurance costs and higher e-commerce technology costs driven by higher sales and commissions.

•Increased other operating expenses of approximately $20,800, primarily due to higher IT and related project costs, sales team costs, travel expenses, and depreciation expense.

•Increased foreign currency-related losses of $7,200, primarily due to unfavorable changes in the US dollar exchange rate against Canadian, Asian, and European foreign currency exchange rates.

•Decreased impairments of operating lease and other long-lived assets of approximately $14,500.

•Decreased expenses for allowances for trade accounts receivable of approximately $4,400, primarily due to a decrease in bad debt expense to account for the lower risk of customer payment defaults resulting from the ongoing recovery from the pandemic.

•The increase in income from operations of DTC was due to higher net sales and lower Company-owned retail store impairments, partially offset by higher variable e-commerce operating costs and higher variable selling costs.

Other Expense, Net. Total other expense, net, compared to the prior period, decreased due to lower interest expense resulting from repayment of our mortgage during fiscal year 2021.

Total Other Comprehensive Loss, Net of Tax. The increase in total other comprehensive loss, net of tax, compared to the prior period, was due to higher foreign currency translation losses relating to changes to our net asset position for unfavorable European and Asian foreign currency exchange rates.

As of March 31, 2022, we have no outstanding balance, outstanding bank guarantees of $32, and available borrowings of $47,254 under our China Credit Facility.

Japan Credit Facility. Our revolving credit facility in Japan (Japan Credit Facility) is an uncommitted revolving line of credit of up to JPY3,000,000, or $24,623. We renewed the Japan Credit Facility through January 31, 2023, substantially under the terms of the original credit agreement.

As of March 31, 2022, we have no outstanding balance and available borrowings of $24,623 under our Japan Credit Facility.

Debt Covenants. As of March 31, 2022, we are in compliance with all financial covenants under our revolving credit facilities.

The following table summarizes the major components our consolidated statements of cash flows for the periods presented:

Net cash provided by operating activities $ 172,353 $ 596,217 $ (423,864) (71.1) % Net cash used in investing activities

(5,154) (94.4) Net change in cash and cash equivalents $ (245,834) $ 439,925 $ (685,759) (155.9) %

The following table summarizes our significant contractual obligations as of March 31, 2022, and the effects of such obligations in future periods:

Critical Accounting Policies and Estimates

Refer to Note 1, "General," of our consolidated financial statements in Part IV within this Annual Report for a discussion of our significant accounting policies and use of estimates, as well as the impact of recent accounting pronouncements.

Accounts Receivable Allowances. The following table summarizes critical accounting estimates for accounts receivable allowances and reserves:

Inventories. The following tables summarize estimates for our inventories:

Refer to Note 7, "Leases and Other Commitments," of our consolidated financial statements in Part IV within this Annual Report for further information, including more details of our accounting policy elections and disclosures.

Refer to Note 8, "Stock-Based Compensation," of our consolidated financial statements in Part IV within this Annual Report for further information on our performance-based stock compensation.

© Edgar Online, source Glimpses