We design and market Skechers-branded contemporary footwear for men, women and children under several unique lines. Our footwear reflects a combination of style, quality and value that appeals to a broad range of consumers. In addition to Skechers-branded lines, we also offer several uniquely branded designer, fashion and street-focused footwear lines for men, women and children. These lines are branded and marketed separately from Skechers and appeal to specific audiences. Our brands are sold through department stores, specialty stores, athletic retailers, and boutiques as well as catalog and Internet retailers. Along with wholesale distribution, our footwear is available at our e-commerce website and our own retail stores. We operate 90 concept stores, 92 factory outlet stores and 37 warehouse outlet stores in the United States, and 22 concept stores and five factory outlets internationally. Our objective is to profitably grow our operations worldwide while leveraging our recognizable Skechers brand through our strong product lines, innovative advertising and diversified distribution channels.
We design, market and sell contemporary footwear for men, women and children under the Skechers brand as well as several other fashion and street brands. Our footwear is sold through a wide range of department stores and leading specialty retail stores, mid-tier retailers, boutiques, our own retail stores, distributor-owned international retail stores and our e-commerce website. Our objective is to continue to profitably grow our domestic operations while leveraging our brand name to expand internationally. Our operations are organized along our distribution channels, and we have the following four reportable sales segments: domestic wholesale sales, international wholesale sales, retail sales and e-commerce sales. We evaluate segment performance based primarily on net sales and gross margins.
While the first half of 2009 was negatively impacted by the continuing weak global economy, results for the second half of the year saw improved year-over-year results. Despite continued poor economic news and reduced consumer spending, we finished 2009 with record sales in the third and fourth quarters.
Our net sales for 2009 were $1.436 billion, a decrease of $4.3 million, or 0.3%, compared to net sales of $1.441 billion in 2008. Net earnings were $54.7 million, a decrease of $0.7 million or 1.3% from net earnings of $55.4 million in 2008. Diluted earnings per share were $1.16, which reflected a 2.5% decrease from the $1.19 reported in the prior year. Working capital was $558.5 million at December 31, 2009, an increase of $144.7 million from working capital of $413.8 million at December 31, 2008. Cash and short-term investments increased by $180.8 million to $295.7 million in 2009 compared to $114.9 million at December 31, 2008, due to the redemption of our investments in auction rate securities of $95.3 million, reduced inventories of $39.4 million and our net earnings of $54.7 million.
In 2009, we focused on product development, domestic and international growth, and inventory and expense management.New product design and delivery. Our success depends on our ability to design and deliver trend-right, affordable product in a diverse range. In 2009, we focused on continuously updating our core styles, adding fresh looks to our existing lines, and developing new lines. This approach has broadened our product offering and ensured the relevance of our brands.
Grow our domestic business. In 2009, our focus was on maintaining our core Skechers business in our domestic wholesale accounts while finding new opportunities to add shelf space and expand into new locations with new Skechers categories. We also focused on expanding our domestic retail distribution channel by opening 16 additional stores while closing two underperforming locations.
Further develop our international businesses. In 2009, we continued to focus on improving our international operations by (i) growing our subsidiary business by increasing our customer base within our existing subsidiary business, including our newest subsidiary in Brazil, and by the acquisition of our distributor in Chile; (ii) increasing the product offering within each account; (iii) delivering the right product into the right markets; and (iv) by building the business of our joint ventures in Asia through additional retail stores and wholesale channels.
Balance sheet and expense management. During the second quarter of 2009, we secured a new $250 million credit facility to provide us liquidity to fund our future initiatives. We also focused on returning to profitability in the second half of 2009 by managing our inventory and expenses to be in line with expected sales.
OUTLOOK FOR 2010
In 2010, we are focusing on maintaining our domestic and international market share by continuing to offer fresh and stylish products at affordable prices while continuing to manage our inventory and expenses. We are continuing to develop new product, much of which will be launching in Spring and Fall of this year, and believe these new styles and lines will allow us the opportunity to broaden the targeted demographic profile of our consumer base, increase our shelf space, and open new locations without detracting from existing business.
We are focused on growing our international business to 25% to 30% of our total sales. We are seeking to increase our global presence through our joint ventures in Asia and to continue to develop our South American subsidiaries’ businesses in Brazil and Chile. We are also looking to grow in new markets with new distributors in India and Mexico as well as to increase our presence in other existing markets.
We will also continue to expand our retail distribution channel by opening another 25 to 30 stores, including approximately seven international company-owned stores, in 2010.
We will continue to develop our infrastructure to support ongoing growth. In January 2010, we entered into a joint venture agreement with HF Logistics I, LLC to construct approximately 1,820,000 square feet of buildings and other improvements that we will use as our domestic distribution facility. We expect the building to be completed and ready for operation in 2011. Once this new facility is available, we plan to move out of our five existing distribution facilities in Ontario, California, creating a more efficient distribution center.
As of January 31, 2010, we employed 4,698 persons, 2,160 of whom were employed on a full-time basis and 2,538 of whom were employed on a part-time basis. None of our employees is subject to a collective bargaining agreement. We believe that our relations with our employees are satisfactory.