Rocky Brands, Inc. reported net income in the third quarter nudged ahead to $5.4 million, or 72 cents a share, from $5.2 million, or 70 cents, a year ago. Sales gained 2.1 percent to $72.5 million from $71.0 million a year ago.
David Sharp, president and chief executive officer, commented, “We are
pleased that several of our more recently launched footwear initiatives
once again delivered strong results. Double digit percentage gains in
our western, commercial military and lifestyle categories, which include
our new Durango City line of more fashion forward boots, fueled a 9%
increase in footwear sales for the third quarter. As apparel sales to
one of our customers continue to decline and growth projections for the
overall work and hunting footwear markets remain modest, we are
encouraged by our ability to successfully develop new growth vehicles
for the future. We are also pleased with our continued progress towards
improving our balance sheet. With funded debt down 30% from a year ago,
the Company is now better positioned to capitalize on the long-term
growth opportunities that lie ahead.”
Third Quarter Review
sales for the third quarter increased 4.5% to $62.9 million compared to
$60.2 million for the same period in 2011. The increase in wholesale
sales was driven by a 9% increase in footwear sales, which was offset by
a decline in apparel sales. Retail sales for the third quarter were
$9.6 million compared to $10.3 million last year. There were no military
segment sales for the third quarter compared to $0.4 million in the
third quarter of 2011.
Gross margin in the third quarter of 2012
was $26.2 million, or 36.1% of sales compared to $25.6 million, or 36.0%
for the same period last year.
Selling, general and
administrative (SG&A) expenses increased 1.2% to $18.2 million or
25.2% of net sales, for the third quarter of 2012 compared to $18.0
million, or 25.4% of net sales a year ago. The $0.2 million increase is
primarily due to higher advertising expenses partially offset by a
decrease in compensation expense.
Income from operations was $7.9
million, or 10.9% of net sales, compared to $7.6 million, or 10.7% of
net sales, in the prior year period.
Interest expense decreased
to $0.2 million for the third quarter of 2012 versus $0.3 million due to
lower borrowings versus the same period a year ago.
Company’s funded debt decreased 30.3% or $18.2 million to $41.9 million
at September 30, 2012 versus $60.1 million at September 30, 2011.
at September 30, 2012 decreased 7.4% or $5.9 million to $73.0 million
compared with $78.9 million on the September 30, 2011.
Conference Call Information
Rocky Brands makes footwear under Rocky, Georgia Boot, Durango and Lehigh as well as the licensed brands Michelin and Mossy Oak.