Weyco Reports First Quarter Sales And Earnings

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MILWAUKEE, May 5, 2015 /PRNewswire/ -- Weyco Group, Inc. WEYS (the "Company") today announced financial results for the quarter ended March 31, 2015.

The Company achieved record first quarter net sales of $78.1 million in 2015. This represents a 4% increase over first quarter 2014 net sales of $74.9 million.  Earnings from operations were $5.8 million in the first quarter of 2015, up 19% as compared to $4.9 million in 2014. Net earnings attributable to the Company rose 13% to $3.6 million in the first quarter of 2015, from $3.2 million in last year's first quarter. Diluted earnings per share increased to $0.33 in the first quarter of 2015, up from $0.29 per share in the first quarter of 2014.

Net sales in the North American wholesale segment, which include North American wholesale sales and licensing revenues, were $61.1 million for the first quarter of 2015, up 8% as compared to $56.7 million in the first quarter of 2014.  Within the wholesale segment, net sales of our BOGS brand were up 20% this quarter, driven by increased sales of women's and children's boots in the U.S. and Canada. Stacy Adams net sales increased 15% for the quarter, due to sales volume increases in the modern dress shoe category across all major distribution channels. Net sales of the Nunn Bush brand were up 5% for the quarter, primarily due to higher sales with department stores and off-price retailers, partially offset by lower sales with national shoe chains.  Florsheim net sales declined 3% for the quarter, mainly due to lower sales with department stores and off-price retailers. Wholesale gross earnings were 31.0% of net sales in the first quarter of 2015, compared to 30.4% in the first quarter of 2014. Driven by higher sales volumes, wholesale earnings from operations increased 35% to $4.8 million in the first quarter of 2015, from $3.6 million in the same period last year.

Net sales in the North American retail segment, which include sales from the Company's Florsheim retail stores and its internet business in the U.S., were $4.9 million in the first quarter of 2015, down 5% as compared to $5.2 million in the first quarter of 2014. The Company's U.S. internet sales were $2.4 million this quarter, up 9% as compared to $2.2 million in last year's first quarter. Same store sales (which include U.S. internet sales) were down 1% for the quarter. There were two fewer domestic retail stores operating during the first quarter of 2015 than there were in last year's first quarter. Earnings from operations for the retail segment were $272,000 in the first quarter of 2015 compared to $418,000 in 2014. This decrease was mainly due to lower net sales at the Company's brick and mortar stores.

Other net sales, which include the wholesale and retail net sales of Florsheim Australia and Florsheim Europe, were $12.0 million in the first quarter of 2015, down 8% as compared to $13.0 million in 2014. This decrease resulted from the translation of local currency sales into U.S. dollars. The majority of other net sales were generated by Florsheim Australia. In local currency, Florsheim Australia's net sales were up 11% for the quarter. This increase was due to higher sales volumes in both its retail businesses, where sales were up 11% (same store sales up 8%), and its wholesale businesses, where sales were up 12%.  As the result of a weaker Australian dollar, when translated to U.S. dollars, Florsheim Australia's net sales were down 2% for the quarter. Florsheim Europe's net sales were down 9% in local currency and 25% in U.S. dollars. Earnings from operations of these other businesses were $703,000 in the first quarter of 2015, down 20% as compared to $884,000 in the same period last year. This decrease was primarily due to lower operating earnings at Florsheim Europe.

"We are excited to have achieved record first quarter sales," stated Thomas W. Florsheim, Jr. the Company's Chairmen and CEO. "Our sales increase was spurred by our sixth consecutive quarter of double-digit sales growth for our BOGS brand, as well as strong sales of our Stacy Adams and Nunn Bush products. We look forward to building upon these successes in the second quarter."

On May 5, 2015, the Company's Board of Directors declared a cash dividend of $0.20 per share to all shareholders of record on May 29, 2015, payable June 30, 2015.  This represents an increase of 5% above the previous quarterly dividend rate of $0.19.

Conference Call Details:

Weyco Group will host a conference call on May 6, 2015, at 11:00 a.m. Eastern Time to discuss the first quarter financial results in more detail.  To participate in the call please dial 888-713-4214 or 617-213-4866, referencing passcode 96819030, five minutes before the start of the call. A replay will be available for one year beginning about two hours after the completion of the call at the following webcast link: http://edge.media-server.com/m/p/t3u3jgdu.  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, 



2015


2014



(In thousands, except per share amounts)






Net sales


$                     78,052


$                     74,929

Cost of sales


49,315


47,565

Gross earnings


28,737


27,364






Selling and administrative expenses


22,951


22,494

Earnings from operations


5,786


4,870






Interest income 


260


289

Interest expense


(18)


(42)

Other expense, net


(278)


(115)






Earnings before provision for income taxes


5,750


5,002






Provision for income taxes


2,158


1,752






Net earnings


3,592


3,250






Net (loss) earnings attributable to noncontrolling interest


(41)


45






Net earnings attributable to Weyco Group, Inc.


$                       3,633


$                       3,205






Weighted average shares outstanding






Basic


10,770


10,833


Diluted


10,867


10,930






Earnings per share






Basic


$                         0.34


$                         0.30


Diluted


$                         0.33


$                         0.29






Cash dividends declared (per share)


$                         0.19


$                         0.18











Comprehensive income


$                       2,266


$                       3,454






Comprehensive (loss) income attributable to noncontrolling interest


(301)


207






Comprehensive income attributable to Weyco Group, Inc.


$                       2,567


$                       3,247

 

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)










March 31, 


December 31, 


2015


2014


(Dollars in thousands)

ASSETS:

Cash and cash equivalents

$                    12,117


$                    12,499

Marketable securities, at amortized cost

5,844


5,914

Accounts receivable, net

55,748


55,100

Inventories

61,151


69,015

Prepaid expenses and other current assets

5,951


7,521

     Total current assets

140,811


150,049





Marketable securities, at amortized cost

23,170


24,540

Deferred income tax benefits

2,152


1,999

Property, plant and equipment, net

33,112


33,694

Goodwill

11,112


11,112

Trademarks

34,748


34,748

Other assets

21,058


21,304

     Total assets

$                  266,163


$                  277,446









LIABILITIES AND EQUITY:

Short-term borrowings

$                      6,621


$                      5,405

Accounts payable

6,799


15,657

Dividend payable

-


2,045

Accrued liabilities

14,265


12,752

Accrued income tax payable

1,371


151

Deferred income tax liabilities

2,019


1,747

     Total current liabilities

31,075


37,757





Long-term pension liability

33,784


33,379

Other long-term liabilities

2,645


8,356





Common stock

10,851


10,821

Capital in excess of par value

40,772


37,966

Reinvested earnings

159,415


160,179

Accumulated other comprehensive loss

(19,096)


(18,030)

     Total Weyco Group, Inc. equity

191,942


190,936

Noncontrolling interest

6,717


7,018

     Total equity

198,659


197,954

     Total liabilities and equity

$                  266,163


$                  277,446

 

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)











Three Months Ended March 31,




2015


2014




(Dollars in thousands)

CASH FLOWS FROM OPERATING ACTIVITIES:





Net earnings

$                   3,592


$                   3,250


Adjustments to reconcile net earnings to net cash





 provided by operating activities - 






Depreciation

734


953



Amortization

110


54



Bad debt expense

34


112



Deferred income taxes

(55)


7



Net foreign currency transaction losses 

203


65



Stock-based compensation

360


338



Pension expense

937


678



Increase in cash surrender value of life insurance

(135)


(135)


Changes in operating assets and liabilities - 






Accounts receivable

(683)


(5,528)



Inventories

7,822


13,422



Prepaid expenses and other assets

1,870


2,799



Accounts payable

(8,841)


(7,551)



Accrued liabilities and other

(5,564)


(1,309)



Accrued income taxes

1,218


1,146



    Net cash provided by operating activities

1,602


8,301







CASH FLOWS FROM INVESTING ACTIVITIES:





Purchase of marketable securities

(300)


(3,528)


Proceeds from maturities of marketable securities

1,715


2,416


Purchase of property, plant and equipment

(531)


(300)



     Net cash provided by (used for) investing activities

884


(1,412)







CASH FLOWS FROM FINANCING ACTIVITIES:





Cash dividends paid

(4,095)


(3,899)


Shares purchased and retired

(2,422)


(81)


Proceeds from stock options exercised

2,149


165


Proceeds from bank borrowings

31,419


4,815


Repayments of bank borrowings

(30,203)


(7,824)


Income tax benefits from stock-based compensation

412


14



     Net cash used for financing activities

(2,740)


(6,810)








Effect of exchange rate changes on cash and cash equivalents

(128)


94








Net (decrease) increase in cash and cash equivalents

$                     (382)


$                      173







CASH AND CASH EQUIVALENTS at beginning of period

12,499


15,969







CASH AND CASH EQUIVALENTS at end of period

$                 12,117


$                 16,142







SUPPLEMENTAL CASH FLOW INFORMATION:





Income taxes paid, net of refunds

$                      535


$                      490


Interest paid

$                        18


$                        30

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/weyco-reports-first-quarter-sales-and-earnings-300077973.html

SOURCE Weyco Group, Inc.

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