MILWAUKEE, May 06, 2025 (GLOBE NEWSWIRE) — Weyco Group, Inc. (NASDAQ: WEYS) (“we,” “our,” “us” and the “Company”) today announced financial results for the quarter ended March 31, 2025.
First Quarter 2025 Overview
- Net sales: $68.0 million (down 5% compared to $71.6 million in Q1 2024)
- Gross earnings: 44.6% of net sales (compared to 44.7% of net sales in Q1 2024)
- Earnings from operations: $7.0 million (down 15% compared to $8.3 million in Q1 2024)
- Net earnings: $5.5 million (down 17% compared to $6.7 million in Q1 2024)
- Diluted earnings per share: $0.57 (down from $0.69 in Q1 2024)
North American Wholesale Segment
Wholesale net sales were $54.3 million for the quarter, down 4% compared to $56.2 million in the first quarter of 2024. Florsheim’s first quarter sales were up 7% due largely to new product launches, but this gain was more than offset by lower sales of our other major brands. Stacy Adams and Nunn Bush sales were down 7% and 16%, respectively, for the quarter, reflecting the current softness in non-athletic footwear at retail, as consumers were cautious with discretionary spending. BOGS sales were down 5%, resulting from lower retailer demand.
Wholesale gross earnings as a percent of net sales were 39.4% and 39.6% in the first quarters of 2025 and 2024, respectively. Wholesale selling and administrative expenses totaled $14.8 million for the quarter and $14.9 million last year. As a percent of net sales, wholesale selling and administrative expenses were flat at 27% in both 2025 and 2024. Wholesale operating earnings decreased 10% to $6.6 million for the quarter, from $7.4 million in 2024, as a result of lower sales.
North American Retail Segment
Net sales in our retail segment, which were generated mainly by our e-commerce websites, were $8.7 million, down 12% from record sales of $9.8 million in 2024. The decrease resulted mainly from lower sales on the BOGS website, due to reduced promotional activities in 2025, compared to strong BOGS website sales in the first quarter of last year.
Retail gross earnings as a percent of net sales were 66.6% and 65.3% in the first quarters of 2025 and 2024, respectively. Retail operating earnings totaled $0.6 million for the quarter, down 52% from $1.3 million last year. The decrease was primarily due to lower sales.
Other Operations
Our other operations historically included our retail and wholesale businesses in Australia, South Africa, and Asia Pacific (collectively, “Florsheim Australia”). We ceased operations in the Asia Pacific region in 2023 and completed the wind down of that business in 2024. Accordingly, first-quarter 2025 results of the “other” category only reflect the operations of Australia and South Africa.
Net sales of Florsheim Australia were $5.1 million, down 7% from $5.5 million in the first quarter of 2024. The weaker Australian dollar relative to the U.S. dollar contributed to this decrease. In local currency, Florsheim Australia’s net sales were down 3% due mainly to the closing of Asia Pacific, partially offset by higher sales in Australia. Net sales in Australia were up 6% in local currency, with higher sales in both its wholesale and retail businesses.
Florsheim Australia’s gross earnings as a percent of net sales were 62.7% and 60.2% in the first quarters of 2025 and 2024, respectively. Florsheim Australia generated operating losses totaling $0.2 million for the quarter and $0.4 million last year. The improvement was due to higher sales in Australia.
Tariffs
Over the last several weeks, the U.S. government enacted a broad range of reciprocal and retaliatory tariffs (“incremental tariffs”) on goods imported into the United States. Including these incremental tariffs, the current effective total tariff rate on goods sourced from China, which is where we source a majority of our products, is 161%, up from 16% in 2024. While the incremental tariffs did not impact our first quarter 2025 performance, unless withdrawn, these tariffs will significantly increase our cost of goods sold in future periods. To mitigate the impact of tariff-cost increases, we have negotiated cost reductions with several of our Chinese suppliers and are planning to raise selling prices beginning in Summer 2025. We are also accelerating our efforts to diversify our sourcing.
“We started the year facing significant geopolitical and macroeconomic uncertainties, including the evolving tariff and trade policies of the U.S. government, recession concerns, and market turmoil,” stated Thomas W. Florsheim, Chairman and CEO. “To date, our efforts to minimize the impact of the incremental tariffs have been fruitful, as we brought in a large amount of inventory ahead of the tariff effective dates. This allows us time, during this tumultuous period, to temporarily halt our China imports as we evaluate plans to mitigate the anticipated future impact of the tariff-cost increases. Despite the uncertainties we face, we are confident in our ability to manage tariff-related cost challenges. Our history of strong operational execution, particularly in the management of our supply chain and price-setting strategy, underscores our proven ability to withstand a turbulent environment.”
Dividend Declaration
On May 6, 2025, our Board of Directors declared a regular quarterly cash dividend of $0.27 per share to all shareholders of record on May 16, 2025, payable June 30, 2025. This represents an increase of 4% above the previous quarterly dividend rate of $0.26.
Conference Call Details
Weyco Group will host a conference call on May 7, 2025, at 11:00 a.m. Eastern Time to discuss the first quarter 2025 financial results in more detail. To participate in the call, please dial 1-888-596-4144 or 1-646-968-2525, using passcode 6441034# at least fifteen minutes before the start of the call. There is no pre-registration link for the call this quarter.
A replay will be available for one year beginning about two hours after the completion of the call at the following webcast link: https://edge.media-server.com/mmc/p/4g97hfsx. Alternatively, the 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 principally for men, but also for women and children, under a portfolio of well-recognized brand names including: Florsheim, Nunn Bush, Stacy Adams, BOGS, and Forsake. The Company’s products can be found in leading footwear, department, and specialty stores, as well as on e-commerce websites worldwide. Weyco Group also operates Florsheim stores in the United States, Australia, and South Africa.
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 our results to be materially different from the results expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the uncertain impacts of U.S. trade and tariff policies – particularly incremental tariffs on goods sourced from China – which remain highly dynamic and unpredictable; the impact of inflation generally and, specifically, increases in our costs for materials, labor and other manufacturing inputs; a slow down or contraction in the overall U.S. or Australian economies; our ability to successfully market and sell our products in a highly competitive industry and in view of changing and unpredictable consumer trends; the effect of unseasonable weather conditions on the demand for certain of our products; our ability to successfully procure our products from independent manufacturers on a timely basis; consumer acceptance of products and other factors affecting retail market conditions, changes in interest rates, the uncertain impact of the wars in Ukraine and Israel and the related economic and other sanctions imposed by the U.S. and European Union; and other factors detailed from time to time in our filings made with the Securities and Exchange Commission, including our annual report on Form 10-K filed on March 14, 2025, which are incorporated herein by reference. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.
For more information, contact:
Judy Anderson
Vice President, Chief Financial Officer and Secretary
414-908-1833
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WEYCO GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) |
|||||||
| March 31, | December 31, | ||||||
| 2025 | 2024 | ||||||
| (Dollars in thousands) | |||||||
| ASSETS: | |||||||
| Cash and cash equivalents | $ | 71,546 | $ | 70,963 | |||
| Marketable securities, at amortized cost | 856 | 852 | |||||
| Accounts receivable, net | 39,765 | 37,464 | |||||
| Income tax receivable | — | 1,086 | |||||
| Inventories | 68,186 | 74,012 | |||||
| Prefunded dividend | — | 21,579 | |||||
| Prepaid expenses and other current assets | 3,347 | 3,435 | |||||
| Total current assets | 183,700 | 209,391 | |||||
| Marketable securities, at amortized cost | 5,532 | 5,529 | |||||
| Deferred income tax benefits | 1,046 | 1,037 | |||||
| Property, plant and equipment, net | 28,083 | 28,180 | |||||
| Operating lease right-of-use assets | 11,279 | 10,504 | |||||
| Goodwill | 12,317 | 12,317 | |||||
| Trademarks | 32,868 | 32,868 | |||||
| Other assets | 24,470 | 24,260 | |||||
| Total assets | $ | 299,295 | $ | 324,086 | |||
| LIABILITIES AND EQUITY: | |||||||
| Accounts payable | $ | 4,801 | $ | 8,378 | |||
| Dividend payable | — | 21,579 | |||||
| Operating lease liabilities | 4,358 | 4,033 | |||||
| Accrued liabilities | 9,094 | 13,273 | |||||
| Accrued income tax payable | 861 | — | |||||
| Total current liabilities | 19,114 | 47,263 | |||||
| Deferred income tax liabilities | 13,912 | 13,922 | |||||
| Long-term pension liability | 9,867 | 9,888 | |||||
| Operating lease liabilities | 7,486 | 7,034 | |||||
| Other long-term liabilities | 366 | 394 | |||||
| Total liabilities | 50,745 | 78,501 | |||||
| Common stock | 9,619 | 9,643 | |||||
| Capital in excess of par value | 73,003 | 72,577 | |||||
| Reinvested earnings | 183,629 | 181,299 | |||||
| Accumulated other comprehensive loss | (17,701 | ) | (17,934 | ) | |||
| Total equity | 248,550 | 245,585 | |||||
| Total liabilities and equity | $ | 299,295 | $ | 324,086 | |||
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WEYCO GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED) |
|||||||
| Three Months Ended March 31, | |||||||
| 2025 | 2024 | ||||||
| (In thousands, except per share amounts) | |||||||
| Net sales | $ | 68,030 | $ | 71,558 | |||
| Cost of sales | 37,655 | 39,551 | |||||
| Gross earnings | 30,375 | 32,007 | |||||
| Selling and administrative expenses | 23,344 | 23,756 | |||||
| Earnings from operations | 7,031 | 8,251 | |||||
| Interest income | 634 | 905 | |||||
| Interest expense | (1 | ) | — | ||||
| Other expense, net | (127 | ) | (95 | ) | |||
| Earnings before provision for income taxes | 7,537 | 9,061 | |||||
| Provision for income taxes | 1,994 | 2,411 | |||||
| Net earnings | $ | 5,543 | $ | 6,650 | |||
| Weighted average shares outstanding | |||||||
| Basic | 9,548 | 9,436 | |||||
| Diluted | 9,664 | 9,580 | |||||
| Earnings per share | |||||||
| Basic | $ | 0.58 | $ | 0.70 | |||
| Diluted | $ | 0.57 | $ | 0.69 | |||
| Cash dividends declared (per share) | $ | 0.26 | $ | 0.25 | |||
| Comprehensive income | $ | 5,776 | $ | 5,631 | |||
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WEYCO GROUP, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) |
|||||||
| Three Months Ended March 31, | |||||||
| 2025 | 2024 | ||||||
| (Dollars in thousands) | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net earnings | $ | 5,543 | $ | 6,650 | |||
| Adjustments to reconcile net earnings to net cash provided by operating activities – | |||||||
| Depreciation | 532 | 584 | |||||
| Amortization | 65 | 66 | |||||
| Bad debt expense | 140 | 44 | |||||
| Deferred income taxes | (33 | ) | (35 | ) | |||
| Net foreign currency transaction losses (gains) | 67 | (9 | ) | ||||
| Share-based compensation expense | 427 | 367 | |||||
| Pension expense | 120 | 220 | |||||
| Loss on disposal of fixed assets | — | 18 | |||||
| Increase in cash surrender value of life insurance | (110 | ) | (105 | ) | |||
| Changes in operating assets and liabilities – | |||||||
| Accounts receivable | (2,441 | ) | (2,865 | ) | |||
| Inventories | 5,827 | 12,928 | |||||
| Prepaid expenses and other assets | (84 | ) | 2,633 | ||||
| Accounts payable | (3,579 | ) | (3,053 | ) | |||
| Accrued liabilities and other | (4,292 | ) | (5,301 | ) | |||
| Accrued income taxes | 1,947 | 2,194 | |||||
| Net cash provided by operating activities | 4,129 | 14,336 | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Proceeds from maturities of marketable securities | — | 215 | |||||
| Purchases of property, plant and equipment | (417 | ) | (170 | ) | |||
| Net cash (used for) provided by investing activities | (417 | ) | 45 | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Cash dividends paid | (2,482 | ) | (4,664 | ) | |||
| Shares purchased and retired | (732 | ) | (5 | ) | |||
| Net cash used for financing activities | (3,214 | ) | (4,669 | ) | |||
| Effect of exchange rate changes on cash and cash equivalents | 85 | (676 | ) | ||||
| Net increase in cash and cash equivalents | $ | 583 | $ | 9,036 | |||
| CASH AND CASH EQUIVALENTS at beginning of period | 70,963 | 69,312 | |||||
| CASH AND CASH EQUIVALENTS at end of period | $ | 71,546 | $ | 78,348 | |||
| SUPPLEMENTAL CASH FLOW INFORMATION: | |||||||
| Income taxes paid, net of refunds | $ | 71 | $ | 207 | |||
| Interest paid | $ | 1 | $ | — | |||
| NON-CASH FINANCING ACTIVITY: | |||||||
| Settlement of dividend payable with prefunded dividend | $ | 21,579 | $ | — | |||
