LaCrosse Footwear reported second-quarter sales increased 8% to $30.0 million, up from $27.8 million a year ago. Net income was $1.7 million, or 26 cents a share, up 15% from $1.4 million or 22 cents, a year ago.
For the first half of 2009, consolidated net sales were $55.9 million, up 6% from $52.5 million in the same period of 2008. For the first half of 2009, net income was $1.0 million or $0.15 per diluted share, down from $2.2 million or $0.35 per diluted share for the same period in 2008.
Sales to the work market were $21.8 million for the second quarter of 2009, up 26% from $17.4 million for the same period of 2008. The growth in work sales reflects continued penetration into various branches of the U.S. military. Sales to the outdoor market were $8.1 million for the second quarter of 2009, down from $10.5 million for the same period of 2008, reflecting continued softness in the overall retail environment.
For the second quarter of 2009, gross margins were a record 40.8% of net sales, up from 40.4% in the same period of 2008. The increase in gross margins was primarily due to lower markdown sales in the quarter and improved production efficiencies in the companys domestic factory.
LaCrosses operating expenses were $10.2 million in the second quarter of 2009, up $1.3 million from the second quarter of 2008. The year-over-year increase was primarily driven by certain one-time costs associated with the transition to the companys new Midwest distribution center of $0.5 million. The balance of the increase was primarily due to the companys strategic initiatives related to its European operations and the formation and operation of its recently acquired brand, Environmentally Neutral Design Outdoor, Inc. (“END”).
The company continued to maintain a strong balance sheet with no debt. At the end of the second quarter of 2009, LaCrosse had cash and cash equivalents of $5.1 million, which includes cash used during the quarter for the purchase of substantially all the assets of END for $0.4 million. The companys year-over-year increase in inventories included $2.5 million to support the companys European subsidiary, $1.7 million to support the increased domestic production of its military business, and $3.6 million to support the strategic decision to accelerate the delivery of certain core products in preparation for anticipated sales in the second half of the year.
“While retail demand remained weak across different market segments and geographic regions, we continued to grow our revenue, and invest in the long-term strength of our business,” said Joseph P. Schneider, president and CEO of LaCrosse Footwear, Inc. “We continued to win more business with various branches of the U.S. military. Our success reflects a sustained commitment to work closely with our military customers and fulfill their demand for premium footwear with proven durability and performance in the field.
“During the second quarter, we continued to execute our strategic initiatives and invest in our business. We completed the transition into our new Midwest distribution center, which has already begun to enhance our operating efficiency, customer service and speed of delivery. We also completed our acquisition of END, which opens up new market opportunities and the potential to infuse ENDs innovation with lightweight and environmentally sustainable design into future LaCrosse and Danner products. We remain focused on leveraging our talented team, powerful brands and strong balance sheet in order to grow our business and maintain operational excellence over the long term.”
Based on the strength of the companys financial position, the Board of Directors today announced the approval of a quarterly dividend of $0.125 per share of common stock. The third quarter dividend will be paid on September 18, 2009 to shareholders of record as of the close of business on August 22, 2009. The Board of Directors, while not declaring future dividends to be paid, has established a quarterly dividend policy reflecting its intent to declare and pay a quarterly dividend of $0.125 per share of common stock for the balance of 2009.
|(amounts in thousands except per share data)||Quarter Ended||First Half Year Ended|
|June 27,||June 28,||June 27,||June 28,|
|Cost of goods sold||17,758||16,568||33,837||31,239|
|Selling and administrative expenses||10,228||8,938||21,097||17,906|
|Non-operating income (expense)||(17||)||(48||)||(69||)||111|
|Income before income taxes||1,973||2,256||883||3,508|
|Income tax provision (benefit)||315||820||(83||)||1,293|
|Net income per common share:|
|Weighted average number of common shares outstanding:|
|Supplemental product line information:|
|Work Market Sales||$||21,837||$||17,356||$||40,880||$||35,243|
|Outdoor Market Sales||8,139||10,454|