LaCrosse Footwear, Inc. reported Q4 sales reached $32.7 million, up 3% from $31.7 million in the fourth quarter of 2006. Net income was $2.4 million or 38 cents per share, up 8% from $2.2 million, or 36 cents, a year ago.
For the full year 2007, net income was $7.3 million, or $1.15 per share, up 15% from $6.3 million or $1.02 per diluted share in 2006. Revenues climbed 9.6% to $118.2 million from $107.8 million.
Sales to the outdoor market were $15.4 million for the fourth quarter of 2007, down 2% from $15.7 million for the same period of 2006. During the fourth quarter of 2007, sales of outdoor boots were adversely impacted by unfavorable weather conditions in the first two months of the period. For the full year of 2007, sales to the outdoor market were $57.3 million, up 8% from $53.1 million in 2006. For the year, the growth in outdoor market sales primarily reflects increased penetration into the rugged outdoor boot markets.
Sales to the work market were $17.2 million for the fourth quarter of 2007, up 8% from $16.0 million for the same period of 2006. For the full year 2007, sales to the work market were $60.9 million, up 11% from $54.7 million in 2006. For the year, the growth in work market sales reflects continued penetration into a variety of general and specialized work boot markets.
The company continued to maintain strong gross margins. For the fourth quarter of 2007, its gross margin was 40.1% of net sales, up from 39.6% or 50 basis points in the same period of 2006. For the full year of 2007, the company's gross margin was 39.7% of net sales, up from 39.2% or 50 basis points in 2006.
LaCrosse's total operating expenses were $9.3 million or 28.6% of net sales in the fourth quarter of 2007, compared to $9.2 million or 29.0% of net sales in the fourth quarter of 2006. This represents the third consecutive quarter of sales growth exceeding operating expense growth. At the same time, the Company continued to increase its investment in its sales and marketing efforts.
At the end of 2007, LaCrosse had cash and cash equivalents of $15.4 million, up 21% from the end of 2006. LaCrosse's inventory at the end of 2007 increased 23% from the end of 2006, reflecting slower than expected sales due to the unfavorable weather conditions in the first half of the fourth quarter of 2007. The company expects to see its inventory levels decline during the first half of 2008.
“Overall, 2007 was a good year for LaCrosse,” said Joseph P. Schneider, president and CEO of LaCrosse Footwear. “Our sales and earnings growth continued to be driven by the success of our new product lines and our ability to meet at-once demand. We achieved record annual gross margins and profits, and we continued to improve our cash position and leverage our operating expenses while investing in growing our business. For the fourth quarter, we are pleased with our execution and financial performance, despite the unseasonably warm weather conditions which impacted our sales throughout October and November.”
“Moving into 2008, we continue to focus on further penetration into niche work market segments that are less impacted by retail spending, including railroad, oil production, mining and other occupations where our products are seen as critical tools for the job. After a successful 2007, LaCrosse is well positioned to continue to capture market share and capitalize on opportunities for sustainable and profitable growth in 2008 and beyond.”
