MILWAUKEE, April 30, 2012 /PRNewswire/ -- Weyco Group, Inc. (NASDAQ: WEYS) (the "Company") today announced financial results for the quarter ended March 31, 2012.
Net sales for the first quarter of 2012 were $75 million, an increase of 16% from 2011 sales of $65 million. Operating earnings for the first quarter were $5.8 million, compared to $4.8 million in 2011. Net earnings attributable to the Company were $3.9 million in 2012, compared to $3.4 million in 2011. Diluted earnings per share increased to $0.35 per share in 2012, up from $0.30 per share in the first quarter of 2011.
Net sales in the North American wholesale segment, which include North American wholesale sales and licensing revenues, were $56.6 million for the first quarter of 2012, compared to $48.1 million in 2011. Wholesale product sales were $55.9 million in the first quarter of 2012, up from $47.5 million in 2011. The increase in wholesale sales was partly due to the acquisition of the Combs Company ("Bogs") on March 2, 2011. Accordingly, the Company's first quarter 2012 results included Bogs' operations from January 1 through March 31, 2012, while 2011 only included Bogs' operations from March 2 through March 31, 2011. Bogs' sales were $5.8 million in the first quarter of 2012, compared to $2.2 million in 2011. The remaining increase in wholesale sales was primarily due to higher sales volumes of the Stacy Adams and Nunn Bush brands across several trade channels. Wholesale sales of Stacy Adams and Nunn Bush were up 17% and 13%, respectively, while net sales of the Florsheim brand were down 2% for the quarter. Licensing revenues were $725,000 in the first quarter of 2012 and $596,000 in 2011. Operating earnings for the segment were $4.5 million in the first quarter of 2012, compared to $3.6 million in 2011.
Net sales in the North American retail segment, which include sales from the Company's Florsheim retail stores in the United States and its Internet business, were $5.7 million in the first quarter of 2012, compared with $5.6 million in 2011, an increase of 1%. Same store sales were up 14% for the quarter. There were 7 fewer domestic retail stores at the end of the first quarter of 2012 compared to 2011. Operating earnings for the segment improved for the quarter due to higher same store sales, slightly higher gross margins and the closure of underperforming stores.
Other net sales, which include the wholesale and retail sales of Florsheim Australia and Florsheim Europe, were $13.0 million in the first quarter of 2012, compared to $11.4 million in 2011. The majority of other net sales were generated by Florsheim Australia. Florsheim Australia's net sales were up 17%. In local currency, net sales of Florsheim Australia were up 12%. Collectively, the operating earnings of the Company's other businesses in the first quarter of 2012 were up $140,000 as compared to 2011.
"We are very pleased with our first quarter results," stated Tom Florsheim, Jr., Chairman and CEO of Weyco Group, Inc. "While having the full first quarter of Bogs sales this year added to our sales volumes, our Stacy Adams and Nunn Bush brands also contributed to our overall sales increases, with each posting double-digit sales gains with higher volumes across several distribution channels."
The Company's Board of Directors declared a cash dividend on April 27, 2012 of $0.17 per share to all shareholders of record on June 1, 2012, payable July 2, 2012. This represents an increase of 6% above the previous quarterly dividend rate of $0.16.
Weyco Group will host a conference call on May 1, 2012 at 11:00 a.m. Eastern Time to discuss the first quarter financial results in more detail. To participate in the call please dial 888-680-0869 or 617-213-4854, referencing passcode 73970524, five minutes before the start of the call. A replay will be available for one week beginning about one hour after the completion of the call by dialing 888-286-8010 or 617-801-6888, referencing passcode 21270523. Alternatively, the conference call and replay will be available by visiting the investor relations section of Weyco Group's website at www.weycogroup.com.
About Weyco Group:
Weyco Group, Inc., designs and markets quality and innovative footwear for men, women and children under a portfolio of well-recognized brand names including: Florsheim, Nunn Bush, Stacy Adams, BOGS, Rafters and Umi. The Company's products can be found in leading footwear, department, and specialty stores worldwide. Weyco Group also operates Florsheim concept stores in the United States and Australia, as well as in a variety of international markets.
Forward-Looking Statements
This press release contains certain forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Various factors could cause the results of Weyco Group to be materially different from any future results expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the Company's ability to: (i) successfully market and sell its products in a highly competitive industry and in view of changing consumer trends, consumer acceptance of products and other factors affecting retail market conditions; (ii) procure its products from independent manufacturers; and (iii) other factors, including those detailed from time to time in Weyco Group's filings made with the SEC. Weyco Group undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.
WEYCO GROUP, INC. AND SUBSIDIARIES |
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED) |
|
|
|
|
|
|
|
|
|
| Three Months Ended March 31, |
|
|
| 2012 |
| 2011 |
|
|
| (In thousands, except per share amounts) |
|
|
|
|
|
|
Net sales |
| $ 75,314 |
| $ 65,146 |
Cost of sales |
| 47,283 |
| 40,321 |
Gross earnings |
| 28,031 |
| 24,825 |
|
|
|
|
|
|
Selling and administrative expenses |
| 22,198 |
| 20,016 |
Earnings from operations |
| 5,833 |
| 4,809 |
|
|
|
|
|
|
Interest income |
| 483 |
| 590 |
Interest expense |
| (129) |
| (90) |
Other income and expense, net |
| 58 |
| 56 |
|
|
|
|
|
|
Earnings before provision for income taxes |
| 6,245 |
| 5,365 |
|
|
|
|
|
|
Provision for income taxes |
| 2,190 |
| 1,863 |
|
|
|
|
|
|
Net earnings |
| 4,055 |
| 3,502 |
|
|
|
|
|
|
Net earnings attributable to noncontrolling interest |
| 186 |
| 130 |
|
|
|
|
|
|
Net earnings attributable to Weyco Group, Inc. |
| $ 3,869 |
| $ 3,372 |
|
|
|
|
|
|
Weighted average shares outstanding |
|
|
|
|
| Basic |
| 10,888 |
| 11,322 |
| Diluted |
| 11,028 |
| 11,366 |
|
|
|
|
|
|
Earnings per share |
|
|
|
|
| Basic |
| $ 0.36 |
| $ 0.30 |
| Diluted |
| $ 0.35 |
| $ 0.30 |
|
|
|
|
|
|
Cash dividends per share |
| $ 0.16 |
| $ 0.16 |
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
| $ 4,890 |
| $ 4,002 |
|
|
|
|
|
|
Comprehensive income attributable to noncontrolling interest |
| 645 |
| 190 |
|
|
|
|
|
|
Comprehensive income attributable to Weyco Group, Inc. |
| $ 4,245 |
| $ 3,812 |
WEYCO GROUP, INC. AND SUBSIDIARIES |
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) |
|
|
|
|
|
|
|
|
| March 31, |
| December 31, |
| 2012 |
| 2011 |
| (Dollars in thousands) |
ASSETS: |
Cash and cash equivalents | $ 10,543 |
| $ 10,329 |
Marketable securities, at amortized cost | 6,538 |
| 4,745 |
Accounts receivable, net | 54,104 |
| 43,636 |
Accrued income tax receivable | - |
| 816 |
Inventories | 51,338 |
| 62,689 |
Deferred income tax benefits | 91 |
| 395 |
Prepaid expenses and other current assets | 5,210 |
| 5,613 |
Total current assets | 127,824 |
| 128,223 |
|
|
|
|
Marketable securities, at amortized cost | 44,590 |
| 46,839 |
Deferred income tax benefits | 3,991 |
| 3,428 |
Property, plant and equipment, net | 31,260 |
| 31,077 |
Goodwill | 11,112 |
| 11,112 |
Trademarks | 34,748 |
| 34,748 |
Other assets | 18,234 |
| 18,081 |
Total assets | $ 271,759 |
| $ 273,508 |
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY: |
Short-term borrowings | $ 39,000 |
| $ 37,000 |
Accounts payable | 5,926 |
| 12,936 |
Dividend payable | 1,742 |
| 1,742 |
Accrued liabilities | 15,066 |
| 13,217 |
Accrued income taxes | 1,417 |
| - |
Total current liabilities | 63,151 |
| 64,895 |
|
|
|
|
Long-term pension liability | 26,772 |
| 26,344 |
Other long-term liabilities | 6,979 |
| 10,879 |
|
|
|
|
Common stock | 10,925 |
| 10,922 |
Capital in excess of par value | 22,671 |
| 22,222 |
Reinvested earnings | 148,260 |
| 146,266 |
Accumulated other comprehensive loss | (13,043) |
| (13,419) |
Total Weyco Group, Inc. equity | 168,813 |
| 165,991 |
Noncontrolling interest | 6,044 |
| 5,399 |
Total equity | 174,857 |
| 171,390 |
Total liabilities and equity | $ 271,759 |
| $ 273,508 |
WEYCO GROUP, INC. AND SUBSIDIARIES |
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Three Months Ended March 31, |
|
|
| 2012 |
| 2011 |
|
|
| (Dollars in thousands) |
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
| Net earnings | $ 4,055 |
| $ 3,502 |
| Adjustments to reconcile net earnings to net cash |
|
|
|
| provided by operating activities - |
|
|
|
|
| Depreciation | 800 |
| 657 |
|
| Amortization | 94 |
| 46 |
|
| Bad debt expense | 78 |
| 26 |
|
| Deferred income taxes | (442) |
| (61) |
|
| Net gain on remeasurement of contingent consideration | (518) |
| - |
|
| Net foreign currency transaction gains | (51) |
| (47) |
|
| Stock-based compensation | 299 |
| 268 |
|
| Pension expense | 989 |
| 737 |
|
| Net gains on disposal of assets | (3) |
| (13) |
|
| Increase in cash surrender value of life insurance | (135) |
| (141) |
| Changes in operating assets and liabilities, net of effects from acquisitions - |
|
|
|
|
| Accounts receivable | (10,554) |
| (5,895) |
|
| Inventories | 11,351 |
| 7,884 |
|
| Prepaids and other assets | 315 |
| 405 |
|
| Accounts payable | (7,021) |
| (3,938) |
|
| Accrued liabilities and other | (1,155) |
| (1,629) |
|
| Accrued income taxes | 2,233 |
| 957 |
|
| Net cash provided by operating activities | 335 |
| 2,758 |
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
| Acquisition of businesses, net of cash acquired | - |
| (27,023) |
| Purchase of marketable securities | - |
| (16) |
| Proceeds from maturities of marketable securities | 431 |
| 1,658 |
| Proceeds from the sale of assets | - |
| 13 |
| Purchase of property, plant and equipment | (891) |
| (654) |
|
| Net cash used for investing activities | (460) |
| (26,022) |
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
| Cash dividends paid | (1,748) |
| (1,817) |
| Shares purchased and retired | (133) |
| (305) |
| Proceeds from stock options exercised | 136 |
| 172 |
| Repayment of debt assumed in acquisition | - |
| (3,814) |
| Net borrowings of commercial paper | - |
| 17,045 |
| Proceeds from bank borrowings | 2,000 |
| 15,000 |
| Repayments of bank borrowings | - |
| (3,000) |
| Income tax benefits from stock-based compensation | 22 |
| 5 |
|
| Net cash provided by financing activities | 277 |
| 23,286 |
|
|
|
|
|
|
| Effect of exchange rate changes on cash and cash equivalents | 62 |
| 22 |
|
|
|
|
|
|
| Net increase in cash and cash equivalents | $ 214 |
| $ 44 |
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS at beginning of period | 10,329 |
| 7,150 |
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS at end of period | $10,543 |
| $ 7,194 |
|
|
|
|
|
|
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
| Income taxes paid, net of refunds | $ 419 |
| $ 1,073 |
| Interest paid | $ 103 |
| $ 74 |
CONTACT: John Wittkowske, Senior Vice President and Chief Financial Officer, +1-414-908-1880
