FT Markets Data
McRae Industries Inc

McRAE INDUSTRIES, INC. REPORTS EARNINGS FOR THE SECOND QUARTER AND FIRST SIX MONTHS OF FISCAL 2026

MOUNT GILEAD, N.C. , March 17, 2026 /PRNewswire/ -- McRaeIndustries,Inc. (Pink: MCRAA and MCRAB) reported consolidated net revenues for the second quarter of fiscal 2026 of $27,948,000 as compared to $27,548,000 for the second quarter of fiscal 2025. Net earnings for the second quarter of fiscal 2026 amounted to $956,000, or $0.42 per diluted Class A common share as compared to $1,053,000, or $0.47 per diluted Class A common share, for the second quarter of fiscal 2025.

Consolidated net revenues for the first six months of fiscal 2026 totaled $59,151,000 as compared to $56,250,000 for the first six months of fiscal 2025. Net earnings for the first six months of fiscal 2026 amounted to $2,404,000, or $1.07 per diluted Class A common share, as compared to net earnings of $2,899,000, or $1.28 per diluted Class A common share, for the first six months of fiscal 2025.

SECOND QUARTER FISCAL 2026 COMPARED TO SECOND QUARTER FISCAL 2025

Consolidated net revenues totaled $27.9 million for the second quarter of fiscal 2026 as compared to $27.5 million for the second quarter of fiscal 2025. Sales related to our western/lifestyle boot products for the second quarter of fiscal 2026 totaled $21.4 million as compared to $20.4 million for the second quarter of fiscal 2025. This increase in net revenues was attributed to the Dan Post and Dingo brands. Revenues from our work boot products decreased from $7.5 million for the second quarter of fiscal 2025 to $6.7 million for the second quarter of fiscal 2026. This was a result of decreased sales for all work boots, which includes our military boots.

Consolidated gross profit for the second quarter of fiscal 2026 amounted to approximately $7.3 million, or 26.2%, as compared to $7.1 million, or 25.9%, for the second quarter of fiscal 2025.

Consolidated selling, general and administrative expenses totaled approximately $6.7 million for the second quarter of fiscal 2026 as compared to $6.4 million for the second quarter of fiscal 2025. This increase resulted primarily from increased marketing expenses.

As a result of the above, the consolidated operating profit for both the second quarter of fiscal 2026 and fiscal 2025 amounted to approximately $0.7 million.

FIRST SIX MONTHS FISCAL 2026 COMPARED TO FIRST SIX MONTHS FISCAL 2025

Consolidated net revenues for the first six months of fiscal 2026 totaled $59.2 million as compared to $56.3 million for the first six months of fiscal 2025. Our western and lifestyle product sales totaled $44.0 million for the first six months of fiscal 2026 as compared to $41.4 million for the first six months of fiscal 2025. This increase was a result of increased sales in the Dan Post and Dingo brands, offset by decreased sales in the Laredo and El Dorado brands. Net revenues from our work boot business slightly decreased from $15.5 million for the first six months of fiscal 2025 to $15.4 million for the first six months of fiscal 2026. There was a decrease in our Dan Post and Laredo work boot product lines, which was offset by an increase in our military boot sales.

Consolidated gross profit totaled $15.3 million, or 25.8%, for the first six months of fiscal 2026 as compared to $15.5 million, or 27.5%, for the first six months of fiscal 2025. As mentioned in our first quarter release, tariffs have significantly impacted our margins in this fiscal year. Based on current information, we expect the tariff impact to decrease in the second half of the year. Alternatively, our military boot operation profitability may be negatively impacted in the third quarter due to the installation of new manufacturing equipment.

Consolidated selling, general and administrative expenses totaled approximately $13.4 million for the first six months of fiscal 2026 as compared to $12.9 million for the first six months of fiscal 2025. This increase resulted primarily from increased sales commissions and marketing expenses.

As a result of the above, the consolidated operating profit amounted to $1.9 million for the first six months of fiscal 2026 as compared to $2.6 million for the first six months of fiscal 2025.

Financial Condition and Liquidity

Our financial condition remained strong at January 31, 2026 as cash and cash equivalents totaled $29.9 million as compared to $31.6 million at August 2, 2025. Our working capital decreased from $85.9 million at August 2, 2025 to $81.6 million at January 31, 2026.

We currently have two lines of credit totaling $6.75 million, all of which was fully available at January 31, 2026. One credit line totaling $1.75 million (which is restricted to one hundred percent of the outstanding receivables due from the Government) expires in January 2027. Our $5.0 million line of credit, which also expires in January 2027, is secured by the inventory and accounts receivable of our Dan Post Boot Company subsidiary.

For the first six months of fiscal 2026, operating activities provided approximately $3.6 million of cash. Net earnings contributed approximately $2.4 million of cash. Adjustments to reconcile net earnings to net cash used in operating activities totaled approximately $1.2 million. These adjustments were driven significantly by decreased inventory and offset by increased prepaid expenses.

Net cash used in investing activities totaled approximately $4.0 million, primarily due to the purchase and sale of securities.

Net cash used in financing activities totaled $1.3 million, which was used primarily for dividend payments.

The Board of Directors of the Company has approved the repurchase of up to $700,000 of shares of McRae A Common Stock or McRae B Common Stock. Repurchases of shares of common stock under the stock repurchase program will be made in the open market and in accordance with applicable securities laws. The stock repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended or terminated at any time at the Company's discretion.

We believe that our current cash and cash equivalents, cash generated from operations, and available credit lines will be sufficient to meet our capital requirements for the remainder of fiscal 2026.

Forward-Looking Statements

This press release includes certain forward-looking statements. Important factors that could cause actual results or events to differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements include: the impact of higher tariff rates on our gross margins in future quarters; the effect of competitive products and pricing, risks unique to selling goods to the Government (including variation in the Government's requirements for our products and the Government's ability to terminate its contracts with vendors), changes in fashion cycles and trends in the western boot business, loss of key customers, acquisitions, supply interruptions, additional financing requirements, our expectations about future Government orders for military boots, loss of key management personnel, our ability to successfully develop new products and services, and the effect of general economic conditions in our markets.

McRae Industries, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)








January 31,
2026


August 2,
2025


ASSETS





Current assets: 










Cash and cash equivalents


$29,895


$31,593






Equity investments


9,251


8,730






Debt securities


4,963


6,786






Accounts receivable, net


17,656


17,836






Inventories, net


21,429


24,599






Income tax receivable


676


639






Prepaid expenses and other current assets     


3,772


1,611






Total current assets


87,641


91,794






Property and equipment, net


5,428


5,274






Other assets:










Deposits


4


14






Right to Use Asset


1,312


1,589






Real estate held for investment


2,311


2,311






Debt securities


10,413


5,032






Trademarks


2,824


2,824






Total other assets


16,863


11,770






Total assets


$109,932


$108,838

 

McRae Industries, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)








January 31,
2026


August 2,
2025


LIABILITIES AND SHAREHOLDERS' EQUITY





Current liabilities: 










Accounts payable


$3,274


$2,093






Accrued employee benefits


397


1,232






Accrued payroll and payroll taxes


662


823






Lease liability


555


555






Other


1,187


1,143






Total current liabilities


6,075


5,846






Lease liability


757


1,034






Deferred tax liabilities


382


382






Total liabilities


7,214


7,262






Shareholders' equity:





Common Stock:





Class A, $1 par value; authorized 5,000,000 shares
   issued and outstanding, 1,892,793 and 1,892,793
   shares, respectively


1,893


1,893






Class B, $1 par value; authorized 2,500,000 shares;
   issued and outstanding, 362,977 and 362,977 shares,     
   respectively


363


363






Retained earnings


100,462


99,320






Total shareholders' equity


102,718


101,576






Total liabilities and shareholders' equity


$109,932


$108,838

 

McRae Industries, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share data)

(Unaudited)










Three Months Ended


Six Months Ended


January 31,


February 1,


January 31,


February 1,

2026

2025

2026

2025









Net revenues

$27,948


$27,548


$59,151


$56,250









Cost of revenues

20,628


20,417


43,900


40,782









Gross profit

7,320


7,131


15,251


15,468









Selling, general and administrative expenses

6,652


6,382


13,394


12,911









Operating profit 

668


749


1,857


2,557









Other income

659


734


1,442


1,462









Earnings before income taxes

1,327


1,483


3,299


4,019









Provision for income taxes

371


430


895


1,120









Net earnings 

$956


$1,053


$2,404


$2,899

























Earnings per common share:
















     Diluted earnings per share:








        Class A

0.42


0.47


1.07


1.28

        Class B

NA


NA


NA


NA









Weighted average number of common shares outstanding:     








       Class A

1,892,793


1,896,334


1,892,793


1,896,334

       Class B

362,977


363,826


362,977


363,826

        Total

2,255,770


2,260,160


2,255,770


2,260,160

 

McRae Industries, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(In thousands, except share data)

(Unaudited)











Common Stock, $1 par value

Accumulated Other




Class A

Class B

Comprehensive

Retained



Shares

Amount

Shares

Amount

 Income (Loss)

 Earnings

Balance, August 3, 2024


1,896,334

$1,897

363,826

$363

$0

$94,805









Cash Dividend ($0.14 per  Class A common stock)     







(265)









Cash Dividend ($0.14 per Class B common stock)







(51)









Net earnings







1,846

Balance, November 2, 2024


1,896,334

$1,897

363,826

$363

$0

$96,335









Cash Dividend ($0.84 per  Class A common stock)







(1,592)









Cash Dividend ($0.84 per Class B common stock)







(304)









Net earnings







1,053

Balance, February 1, 2025


1,896,334

$1,897

363,826

$363

$0

$95,492











Common Stock, $1 par value

Accumulated Other




Class A

Class B

Comprehensive

Retained



Shares

Amount

Shares

Amount

 Income (Loss)

 Earnings

Balance, August 2, 2025


1,892,793

$1,893

362,977

$362

$0

$99,320









Cash Dividend ($0.14 per  Class A common stock)







(265)









Cash Dividend ($0.14 per Class B common stock)







(51)









Net earnings







1,449

Balance, November 1, 2025


1,892,793

$1,893

362,977

$362

$0

$100,453









Cash Dividend ($0.42 per  Class A common stock)







(795)









Cash Dividend ($0.42 per Class B common stock)







(152)









Net earnings







956

Balance, January 31, 2026


1,892,793

$1,893

362,977

$362

$0

$100,462

 

McRae Industries, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)








Six Months Ended



January 31,


February 1,



2026

2025






Cash Flows from Operating Activities:










Net earnings


$2,404


$2,899






Adjustments to reconcile net earnings to net cash used     
in operating activities


1,182


(3,472)






Net cash provided in operating activities


3,586


(573)






Cash Flows from Investing Activities:










Proceeds from sale of land


-


50






Proceeds from sale of fixed assets


-


263






Capital expenditures


(516)


(275)






Purchase of securities


(7,514)


(1,112)






Proceeds from sale of securities


4,008


5,973






Net cash used in investing activities


(4,022)


4,899






Cash Flows from Financing Activities:










Dividends paid


(1,262)


(2,213)






Net cash used in financing activities


(1,262)


(2,213)






Net (Decrease) Increase in Cash and Cash equivalents


(1,698)


2,113






Cash and Cash Equivalents at Beginning of Year


31,593


20,723






Cash and Cash Equivalents at End of Period


$29,895


$22,836

 

Cision View original content:https://www.prnewswire.com/news-releases/mcrae-industries-inc-reports-earnings-for-the-second-quarter-and-first-six-months-of-fiscal-2026-302716445.html

SOURCE McRae Industries, Inc.