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I'll now turn the call over to Tom for a deeper review of the numbers and an update on guidance.
Thanks, Angel. Today's earnings release contains a good amount of baby uggs on sale
detail about our second quarter sales and earnings, including sales by mini bailey button uggs sale thanksgiving uggs on sale
brand channel and geography. Therefore, I'm going to limit my discussion to primarily the gross margins, operating expenses, the balance sheet and guidance.
Gross margins for the second quarter was 41.1% compared to 42.2% in the second quarter of last year. The 110 basis point decline was primarily attributable to a higher close out sales combined with kids uggs sale clearance higher cost to goods sold that were the result of increased sheepskin price that we locked in at the end of September '11. The benefit of last year's lower sheepskin cost won't be realized until late Q3 or early Q4 this year.
Total SG expense for the quarter was $112.6 million, or 66.2% of net sales, compared to $102.3 million, or 58.6% of net sales a year ago. The dollar increase versus a year ago was primarily due to approximately $10 million of additional expense related to our retail operations, most of which is for the 36 new retail stores that were not open during the second quarter last year, uggs on sale for black friday 2013 as well as higher performance based compensation expense, partially offset by a decrease in Sanuk earnout accretion compared with a year ago.?Deckers Outdoor Corp DECK
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