LaCrosse Footwear, Inc. swung to a loss in the fiscal first quarter ended March 26 as a steep decline in military orders sank sales in the company’s Work market segment significantly.
Total sales for the Portland, OR-based manufacturer of work and outdoor footwear dropped 26.4 percent to $25.2 million from $34.2 million in the year-ago period, when sales in the company’s Work market jumped nearly 40 percent, boosting the overall top-line total by 32.1 percent. BOOT recorded a net loss of $650,000, or 10 cents per diluted share, in Q1, compared to a net income of $1.7 million in Q1 2010.
Work market sales fell 39.1 percent to $16.1 million on the aforementioned weakness from military sales. For the Outdoor segment, sales improved 16.1 percent to $9.1 million from $7.9 million, reflecting strong demand for hiking and hunting products.
Gross margins were up 120 basis points to 41.4 percent of net sales in Q1. The increase in gross margins were said to primarily reflect the success of new products and the strong growth of its wholesale and direct business.
In a conference call with analysts, LaCrosse President and CEO Joe Schneider said that although management was “very disappointed” in sales to the military during the quarter, the company was optimistic about a recent $2.4 million order placed by the US. Marine Corps. Excluding the government channel (which includes military sales), sales to the company’s other channels increased 14 percent compared to the year-ago period.
Management pointed out that increased inventory levels in the first quarter supports increased at-once sales and a 22 percent increase in Q2 backlog.
