LaCrosse Footwear, Inc. net sales declined $4.6 million compared to the fourth quarter in 2001. Discontinued product lines represented $3.1 million of the total decrease while the remaining $1.5 million was related to continued softness in both the retail and industrial sectors.

Ongoing LaCrosse(R) Retail product sales declined 11.5% while ongoing LaCrosse(R) Safety and Industrial products were off by 6.2%. These declines were partially offset by a 3.2% sales increase for Danner(R) brand products over the comparable period of last year.

For the year ended December 31, 2002, net sales declined to $97.8 million from $125.3 million in 2001. The full year 2002 net loss was $5.1 million, or a net loss of $0.87 per share, compared to a net loss of $7.9 million, or a net loss of $1.35 per share, in 2001.

Gross margins increased to 28.2% from 25.7% or a 2.5% increase over the fourth quarter of the prior year due to the elimination of lower margin products and a larger portion of sales from higher-margin sourced products. Gross margins for the year increased to 26.8% as compared to 24.1% for 2001. This increase in gross margins was primarily due to a focus on higher margin sourced products and a one-time charge of $3.7 million during the first half of 2001 related to the closing of a factory in La Crosse, Wisconsin. Approximately 70% of the products sold in 2002 were outsourced as compared to 62% in 2001.

Operating expenses decreased $3.3 million in the fourth quarter, or 33.2%, to $6.6 million compared to $9.9 million for the same period last year. The reduction in expenses for the quarter was related to consolidation of back-office functions, reduced variable expenses, and the one-time charge of $1.8 million incurred during the fourth quarter of 2001 for impairment of brands and accelerated depreciation of a previous enterprise software package.

Operating expenses for the year ending December 31, 2002 decreased to $30.2 million from $35.5 million in 2001. The $5.3 million decline was the result of variable expense savings in 2002 due to reduced sales, back-office consolidation of Retail and Industrial operations in Portland, Oregon, and one-time charges of $1.8 million in the fourth quarter of 2001 as discussed above.

Inventories declined by $10.9 million from last year-end as a result of a focused inventory reduction plan and improved controls. Trade accounts receivable declined by $4.2 million from last year-end due to improved collection practices and reduced sales. The combination of these two factors led to a notes payable reduction of $9.3 million from last year-end and long-term debt reduction of $1.6 million.

Product related events in the fourth quarter were significant. The US Patent Office granted a patent to the Company in connection with footwear embodying our TERRA FORCE(TM) technology, featured on a variety of Danner(R) brand products. TERRA FORCE(TM) components and the completed product are covered under this patent. A variety of new products under trademarked brands were also announced by the LaCrosse(R) Retail, Danner(R), and LaCrosse Safety and Industrial divisions. The most significant new product series announced is the new Alpha(TM) line of sporting and occupational products that incorporate a patent-pending, rubber-clad neoprene construction. Product shipments will begin during the second half of 2003.

“We continue to see improved financial performance delivered by our operating plan, which is based on innovative product, superior customer service, and compelling marketing,” said Joseph P. Schneider, President and CEO of LaCrosse Footwear, Inc. “We are increasing product margins through effective sourcing, reducing costs through sharing resources across all three brands, improving inventory management with better forecasting and sourcing systems, while paying down our debt. Our Fall 2003 line of products supported by our marketing efforts is beginning to show positive results. We are better prepared for increased at-once purchases by dealers and distributors through investments in our Outpost business-to-business (B2B) website, which provides customers with real-time account data and other key services. Were optimistic that our improved operating plan and exceptional employees will drive the success of our company.”

                           LaCrosse Footwear, Inc.
                           SELECTED FINANCIAL DATA
               (Amounts in thousands, except per share amounts)

    Condensed Consolidated
     Statements of Operations         Three Months Ended        Year Ended
                                      Dec. 31,   Dec. 31,   Dec. 31,  Dec. 31,
                                        2002       2001       2002      2001

    Net Sales                        $25,834     $30,461    $97,785  $125,301
    Cost of Goods Sold                18,543      22,618     71,574    95,158
    Gross Profit                       7,291       7,843     26,211    30,143
    Operating Expenses                 6,599       9,875     30,210    35,451
    Operating Income (Loss)              692      (2,032)    (3,999)   (5,308)
    Non-operating Expenses, net
         391         208      1,597     2,641
    Income (Loss) Before Income Taxes    301      (2,240)    (5,596)   (7,949)
    Income Tax (Benefit)                (538)         --     (1,538)       --
    Net Income (Loss) Before Cumulative
     Effect of Accounting Change         839      (2,240)    (4,058)   (7,949)
    Cumulative Effect of Change in
     Accounting for Goodwill              --          --     (1,028)       --
    Net Income (Loss)                   $839     $(2,240)   $(5,086)  $(7,949)