Rocky Brands, Inc. Announces First Quarter 2024 Results
Net Sales Increased 2.2% to
Operating Income Increased 92% to
Inventories Down 26% Year-over-Year to
First Quarter 2024 Overview
-
Net sales increased 2.2% to
$112.9 million and increased 7.6% excluding Servus brand net sales from the year ago period -
Operating income increased 92.1% to
$8.0 million , or 76.4% to$8.7 million on an adjusted basis -
Net income was
$2.6 million , or$0.34 per diluted share, as compared to net loss of$0.4 million or$0.05 per diluted share in the year ago period -
Adjusted net income was
$3.1 million , or$0.41 per diluted share as compared to net loss of$0.8 million or$0.12 per diluted share in the year ago period - Inventories decreased 26.3% year-over-year
-
Total debt at
March 31, 2024 was down 29.0% compared withMarch 31, 2023
“Our first quarter performance represents a solid start to the year,” said
First Quarter 2024 Review
First quarter net sales increased 2.2% to
Gross margin in the first quarter of 2024 was
Operating expenses were
Income from operations for the first quarter of 2024 was
Interest expense for the first quarter of 2024 was
The Company reported first quarter net income of
Balance Sheet Review
Cash and cash equivalents were
Inventories at
Total debt, net of unamortized debt issuance costs, at
On
Conference Call Information
The Company's conference call to review first quarter 2024 results will be broadcast live over the internet today,
About
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 and include statements in this press release regarding the Company's positioning to generate enhanced profitability and increased shareholder value in 2024 (Paragraph 2) and include statements in this press release regarding the expectations of the debt refinancing to generate interest savings of approximately
Condensed Consolidated Balance Sheets (In thousands, except share amounts) (Unaudited) |
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2024 |
|
2023 |
|
2023 |
||||
ASSETS: |
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CURRENT ASSETS: |
|
|
|
||||||
Cash and cash equivalents |
$ |
3,059 |
$ |
4,470 |
$ |
4,946 |
|||
Trade receivables – net |
|
70,662 |
|
77,028 |
|
73,650 |
|||
Contract receivables |
|
- |
|
927 |
|
- |
|||
Other receivables |
|
1,913 |
|
1,933 |
|
2,235 |
|||
Inventories – net |
|
165,129 |
|
169,201 |
|
224,124 |
|||
Income tax receivable |
|
538 |
|
1,253 |
|
- |
|||
Prepaid expenses |
|
6,037 |
|
3,361 |
|
5,619 |
|||
Total current assets |
|
247,338 |
|
258,173 |
|
310,574 |
|||
LEASED ASSETS |
|
7,139 |
|
7,809 |
|
10,153 |
|||
PROPERTY, PLANT & EQUIPMENT – net |
|
51,305 |
|
51,976 |
|
54,666 |
|||
|
|
47,844 |
|
47,844 |
|
47,844 |
|||
IDENTIFIED INTANGIBLES – net |
|
111,919 |
|
112,618 |
|
114,716 |
|||
OTHER ASSETS |
|
982 |
|
965 |
|
1,028 |
|||
TOTAL ASSETS |
$ |
466,527 |
$ |
479,385 |
$ |
538,981 |
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LIABILITIES AND SHAREHOLDERS' EQUITY: |
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CURRENT LIABILITIES: |
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|
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Accounts payable |
$ |
53,479 |
$ |
49,840 |
$ |
66,783 |
|||
Contract liabilities |
|
- |
|
927 |
|
- |
|||
Current portion of long-term debt |
|
2,650 |
|
2,650 |
|
2,823 |
|||
Accrued expenses: |
|
|
|
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Salaries and wages |
|
1,774 |
|
1,204 |
|
1,816 |
|||
Taxes – other |
|
523 |
|
925 |
|
857 |
|||
Accrued freight |
|
2,193 |
|
2,284 |
|
2,098 |
|||
Commissions |
|
657 |
|
904 |
|
706 |
|||
Accrued duty |
|
5,867 |
|
5,440 |
|
6,642 |
|||
Accrued interest |
|
1,979 |
|
2,104 |
|
2,311 |
|||
Income tax payable |
|
- |
|
- |
|
1,052 |
|||
Other |
|
5,626 |
|
5,251 |
|
5,902 |
|||
Total current liabilities |
|
74,748 |
|
71,529 |
|
90,990 |
|||
LONG-TERM DEBT |
|
153,302 |
|
170,480 |
|
216,973 |
|||
LONG-TERM TAXES PAYABLE |
|
169 |
|
169 |
|
169 |
|||
LONG-TERM LEASE |
|
4,801 |
|
5,461 |
|
7,501 |
|||
DEFERRED INCOME TAXES |
|
7,475 |
|
7,475 |
|
8,006 |
|||
DEFERRED LIABILITIES |
|
737 |
|
716 |
|
1,053 |
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TOTAL LIABILITIES |
|
241,232 |
|
255,830 |
|
324,692 |
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SHAREHOLDERS' EQUITY: |
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Common stock, no par value; |
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25,000,000 shares authorized; issued and outstanding |
|
72,312 |
|
71,973 |
|
70,107 |
|||
Retained earnings |
|
152,983 |
|
151,582 |
|
144,182 |
|||
Total shareholders' equity |
|
225,295 |
|
223,555 |
|
214,289 |
|||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY |
$ |
466,527 |
$ |
479,385 |
$ |
538,981 |
Condensed Consolidated Statements of Operations (In thousands, except share amounts) (Unaudited) |
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Three Months Ended |
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2024 |
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2023 |
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|
$ |
112,906 |
|
$ |
110,445 |
|
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COST OF GOODS SOLD |
|
68,757 |
|
|
66,686 |
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GROSS MARGIN |
|
44,149 |
|
|
43,759 |
|
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|
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OPERATING EXPENSES |
|
36,166 |
|
|
39,604 |
|
||
|
|
|
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INCOME FROM OPERATIONS |
|
7,983 |
|
|
4,155 |
|
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INTEREST EXPENSE AND OTHER – net |
|
(4,654 |
) |
|
(4,664 |
) |
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|
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INCOME (LOSS) BEFORE INCOME TAX EXPENSE |
|
3,329 |
|
|
(509 |
) |
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|
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|
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INCOME TAX EXPENSE (BENEFIT) |
|
779 |
|
|
(111 |
) |
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|
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NET INCOME (LOSS) |
$ |
2,550 |
|
$ |
(398 |
) |
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|
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|
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INCOME (LOSS) PER SHARE |
|
|
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Basic |
$ |
0.34 |
|
$ |
(0.05 |
) |
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Diluted |
$ |
0.34 |
|
$ |
(0.05 |
) |
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING |
|
|
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|
|
|
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Basic |
|
7,417 |
|
|
7,346 |
|
||
Diluted |
|
7,450 |
|
|
7,346 |
|
Reconciliation of GAAP Measures to Non-GAAP Measures (In thousands, except share amounts) (Unaudited) |
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Three Months Ended |
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2024 |
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2023 |
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ADJUSTED GROSS MARGIN |
$ |
44,149 |
|
$ |
43,759 |
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OPERATING EXPENSES |
|
|
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OPERATING EXPENSES, AS REPORTED |
$ |
36,166 |
|
$ |
39,604 |
|
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LESS: ACQUISITION-RELATED AMORTIZATION |
|
(692 |
) |
|
(764 |
) |
||
ADJUSTED OPERATING EXPENSES |
$ |
35,474 |
|
$ |
38,840 |
|
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|
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|
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ADJUSTED OPERATING INCOME |
$ |
8,675 |
|
$ |
4,919 |
|
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INTEREST EXPENSE AND OTHER – net , AS REPORTED |
$ |
(4,654 |
) |
$ |
(4,664 |
) |
||
LESS: GAIN ON SALE OF BUSINESS |
|
- |
|
|
(1,341 |
) |
||
ADJUSTED INTEREST EXPENSE AND OTHER – net |
|
(4,654 |
) |
|
(6,005 |
) |
||
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NET INCOME |
|
|
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NET INCOME (LOSS), AS REPORTED |
$ |
2,550 |
|
$ |
(398 |
) |
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TOTAL NON-GAAP ADJUSTMENTS |
|
692 |
|
|
(577 |
) |
||
TAX IMPACT OF ADJUSTMENTS |
|
(162 |
) |
|
126 |
|
||
ADJUSTED NET INCOME (LOSS) |
$ |
3,080 |
|
$ |
(849 |
) |
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NET INCOME (LOSS) PER SHARE, AS REPORTED |
|
|
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BASIC |
$ |
0.34 |
|
$ |
(0.05 |
) |
||
DILUTED |
$ |
0.34 |
|
$ |
(0.05 |
) |
||
|
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ADJUSTED NET INCOME (LOSS) PER SHARE |
|
|
||||||
BASIC |
$ |
0.42 |
|
$ |
(0.12 |
) |
||
DILUTED |
$ |
0.41 |
|
$ |
(0.12 |
) |
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WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
||||||
BASIC |
|
7,417 |
|
|
7,346 |
|
||
DILUTED |
|
7,450 |
|
|
7,346 |
|
Use of Non-GAAP Financial Measures
In addition to GAAP financial measures, we present the following non-GAAP financial measures: "non-GAAP adjusted operating expenses," "non-GAAP adjusted operating income," "non-GAAP adjusted interest expense and other income/(expense) - net," "non-GAAP adjusted net income," and "non-GAAP adjusted net income per share." Adjusted results exclude the impact of items that management believes affect the comparability or underlying business trends in our consolidated financial statements in the periods presented. We believe that these non-GAAP measures are useful to management and investors and other users of our consolidated financial statements as an additional tool for evaluating operating performance. We believe they also provide a useful baseline for analyzing trends in our operations.
Investors should not consider these non-GAAP measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. See "Reconciliation of GAAP Measures to Non-GAAP Measures" accompanying this press release.
Non-GAAP adjustment or measure |
Definition |
Usefulness to management and investors |
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Acquisition- related amortization |
Amortization of acquisition-related intangible assets consists of amortization of intangible assets such as brands and customer relationships acquired in connection with the acquisition of the performance and lifestyle footwear business of Honeywell International Inc. Charges related to the amortization of these intangibles are recorded in operating expenses in our GAAP financial statements. Amortization charges are recorded over the estimated useful life of the related acquired intangible asset, and thus are generally recorded over multiple years. |
We excluded amortization charges for our acquisition-related intangible assets for purposes of calculating certain non-GAAP measures because these charges are inconsistent in size and are significantly impacted by the valuation of our acquisition. These adjustments facilitate a useful evaluation of our current operating performance and comparison to past operating performance and provide investors with additional means to evaluate cost and expense trends. |
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Gain on sale of business |
Gain on sale of business relates to the sale of the brand Servus. This includes the disposal of non-financial assets and corresponding expenses relating to the sale of the brand along with assets held at our |
We excluded the disposition of non-financial assets and related expenses for purposes of calculating certain non-GAAP measures because the gain does not accurately reflect our current operating performance and comparisons to past operating results and provide investors with additional means to evaluate cost trends. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20240430763089/en/
Company Contact:
Chief Operating Officer, Chief Financial Officer and Treasurer
(740) 753-9100
Investor Relations:
(203) 682-8200
Source: