Rocky Brands, Inc. Announces First Quarter 2017 Results
•First Quarter Diluted EPS Improved to $0.20
--Funded Debt Decreased 75.8% Year-over-Year to $5.2 Million
Rocky Brands, Inc. (RCKY) today announced financial results for
its first quarter ended March 31, 2017.
First Quarter 2017 Sales and Income
First quarter net sales increased 9.6% to $63.1 million compared to
$57.5 million in the first quarter of 2016. The Company reported first
quarter net income of $1.5 million, or $0.20 per diluted share compared
to a net loss of $0.2 million, or ($0.03) per diluted share in the first
quarter of 2016.
Mike Brooks, Chairman and Chief Executive Officer, commented, "Our first
quarter results represent a solid start to 2017. We achieved
approximately 10% top-line growth by more than doubling our military
segment sales to a quarterly record $12 million. Importantly, we were
able to fulfill this significant increase in military footwear demand at
margins well above the last half of 2016 due to improved efficiencies at
our company-operated production facility in Puerto Rico. At the same
time, sales trends in our wholesale segment have stabilized,
particularly in Work and Western, our two largest categories. On top of
this, wholesale gross margins improved meaningfully year-over-year
driven by a higher mix of full priced selling. The actions we have taken
over the past six months to better position the company for profitable
growth are clearly gaining traction. While there is still work ahead of
us in order to maximize shareholder value over the long-term, we are
confident we are heading in the right direction."
First Quarter Review
Net sales for the first quarter increased 9.6% to $63.1 million compared
to $57.5 million a year ago. Wholesale sales for the first quarter were
$39.2 million compared to $40.2 million for the same period in 2016.
Retail sales for the first quarter were $11.9 million compared to $11.5
million for the same period last year. Military segment sales for the
first quarter increased 107% to $12.0 million compared to $5.8 million
in the first quarter of 2016.
Gross margin in the first quarter of 2017 increased to $19.7 million, or
31.3% of sales, compared to $18.9 million, or 32.9% of sales, for the
same period last year. The 160 basis point decrease was driven by the
increase in military segment sales which carry lower gross margins than
our wholesale and retail segments.
Selling, general and administrative (SG&A) expenses decreased to $17.4
million, or 27.6% of net sales, for the first quarter of 2017 compared
to $19.1 million, or 33.3% of net sales, a year ago. The $1.7 million
decrease in SG&A expenses was primarily related to lower compensation
expense following the workforce reductions in the second half of 2016.
Income from operations was $2.4 million, or 3.8% of net sales compared
to a loss from operations of $0.2 million a year ago.
Interest expense was $90,000 for the first quarter of 2017, versus
$136,000 for the same period last year.
The Companys funded debt decreased $16.4 million, or 75.8% to $5.2
million at March 31, 2017 versus $21.6 million at March 31, 2016.
Inventory at March 31, 2017 decreased 18.6% to $68.8 million compared to
$84.5 million on the same date a year ago.
Conference Call Information
The Companys conference call to review first quarter 2017 results will
be broadcast live over the internet today, Thursday, April 20, 2017 at
4:30 pm Eastern Time. The broadcast will be hosted at http://www.rockybrands.com.
About Rocky Brands, Inc.
Rocky Brands, Inc. is a leading designer, manufacturer and marketer of
premium quality footwear and apparel marketed under a portfolio of well
recognized brand names including Rocky(R), Georgia Boot(R), Durango(R),
Lehigh(R), Creative Recreation(R), and the licensed brand Michelin(R).
Safe Harbor Language
This press release contains certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities and Exchange Act of 1934, as amended,
which are intended to be covered by the safe harbors created thereby.
Those statements include, but may not be limited to, all statements
regarding intent, beliefs, expectations, projections, forecasts, and
plans of the Company and its management. These forward-looking
statements involve numerous risks and uncertainties, including, without
limitation, the various risks inherent in the Companys business as set
forth in periodic reports filed with the Securities and Exchange
Commission, including the Companys annual report on Form 10-K for the
year ended December 31, 2016 (filed March 9, 2017). One or more of these
factors have affected historical results, and could in the future affect
the Companys businesses and financial results in future periods and
could cause actual results to differ materially from plans and
projections. Therefore there can be no assurance that the
forward-looking statements included in this press release will prove to
be accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the Company, or any other
person should not regard the inclusion of such information as a
representation that the objectives and plans of the Company will be
achieved. All forward-looking statements made in this press release are
based on information presently available to the management of the
Company. The Company assumes no obligation to update any forward-looking
Rocky Brands, Inc. and Subsidiaries
March 31, 2017
December 31, 2016
March 31, 2016
Cash and cash equivalents
Trade receivables - net
Income tax receivable
Total current assets
FIXED ASSETS - net
LIABILITIES AND SHAREHOLDERS EQUITY:
Accrued other expenses:
Total current liabilities
LONG TERM DEBT
DEFERRED INCOME TAXES
Common stock, no par value;
25,000,000 shares authorized; issued and outstanding
31, 2017 - 7,435,467; December 31, 2016 -
Total shareholders equity
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY
Rocky Brands, Inc. and Subsidiaries
Consolidated Statements of Operations
COST OF GOODS SOLD
INCOME (LOSS) FROM OPERATIONS
OTHER INCOME AND (EXPENSES):
Other - net
Total other - net
INCOME (LOSS) BEFORE INCOME TAXES
INCOME TAX EXPENSE (BENEFIT)
NET INCOME (LOSS)
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
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SOURCE: Rocky Brands, Inc.
Tom Robertson, 740-753-1951
Brendon Frey, 203-682-8200