LaCrosse Footwear reported fourth-quarter sales slid 15.9 percent to $43.8 million, compared to $52.1 million in the same period of 2010. Sales to the outdoor market were down 20 percent, reflecting a cautious retail environment and unfavorable weather
conditions during the second half of 2011, partially offset by stronger
demand for the company’s new hiking boots.

Sales to the outdoor market were down 2 percent for the year.

Sales to the work market were $27.1
million for the fourth quarter and $76.9 million for the full year of
2011, down 13 percent and 19 percent, respectively, from the same periods of 2010. The
decrease in work sales primarily reflects a reduction of contract
delivery orders to the U.S. military and the company's discontinuation
of its work apparel products. Excluding its contract military and work
apparel sales, the company’s core work sales for the fourth quarter and
full of 2011 increased 10 percent and 13 percent, respectively, compared to the same
periods in 2010.

Net income was $2.2 million or 33 cents per diluted share in the fourth
quarter of 2011, compared to $4.0 million or 60 cents per diluted share in
the same period of 2010. For the full year 2011, net income was $3.0
million or 45 cents per diluted share, compared to $6.9 million or $1.04
per diluted share in 2010.

Gross margins
were 37.4 percent of net sales for the fourth quarter and 39.0 percent for the full
year 2011, compared to 39.3 percent for both the fourth quarter and the full
year in 2010. The year-over-year decline in fourth quarter gross margins
primarily reflects an increase in close-out sales.

For the
fourth quarter of 2011, the company reduced operating expenses by
approximately $1.4 million or 10 percent from the same period in 2010, despite
increased investments in product development and marketing activities.

The company maintained a strong balance sheet while making significant
investments in its operations and preparedness for future growth. During
2011, the company made capital investments of $4.0 million and
distributed dividends of $3.3 million to shareholders. As expected, the company reduced its inventory in the fourth quarter of 2011 by $9.3
million from the third quarter in order to bring inventory levels in
line with seasonal demand. In connection with the decline in inventory,
short term debt declined $8.8 million during the fourth quarter of 2011.

“While
2011 was a challenging year, we penetrated into niche work and outdoor
markets, remained profitable and took important steps to improve the
long-term efficiency and strength of our business,” said Joseph P.
Schneider, president and CEO of LaCrosse Footwear, Inc. “Our revenue was
impacted by fluctuations in our contract military business throughout
the year and unfavorably warm and dry weather in the second half of the
year. At the same time, we had strong growth in sales of our new hiking
boots and our core work boots, particularly in such market segments as
mining, oil and gas exploration, and agriculture. We also continued to
see strong growth through our direct and international channels.

“As
we move into 2012, our relationships with major retailers continue to
strengthen and we expect to continue to see strong growth in our direct
and international channels. During 2012, we plan to introduce a
significant number of new products, including innovative outdoor
products, tactical law enforcement boots and an exciting women’s
lifestyle product line. While we expect continued quarter-to-quarter
fluctuations in our contract military business, we have structured our
operating model to improve profitability with or without the upside of
future military contracts. We believe LaCrosse is well-positioned to
continue to capture market share and grow profitably over the long
term.”

Based on the company’s financial position, the board of directors announced the approval of a quarterly dividend of $0.125
per share of common stock. The first quarter dividend will be paid on
March 18, 2012 to shareholders of record as of the close of business on
February 22, 2012. 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.

LaCrosse Footwear, Inc.
Condensed Consolidated Statements of Income

(Amounts in thousands, except per share amounts)

(Unaudited)

 


 

 

 





Quarter Ended
 

 
Year Ended




December 31,
 

 
December 31,

December 31,
 

 
December 31,




2011

2010

2011

2010














 

Net sales




$

43,827




$

52,081




$

131,321




$

150,542


Cost of goods sold




 

27,430

 



 

31,598

 



 

80,085

 



 

91,413

 

Gross profit





16,397





20,483





51,236





59,129


Operating expenses




 

12,671

 



 

14,033

 



 

45,701

 



 

47,699

 

Operating income





3,726





6,450





5,535





11,430


Non-operating expense




 

(287

)



 

(132

)



 

(720

)



 

(239

)

Income before income taxes





3,439





6,318





4,815





11,191


Income tax provision




 

1,274

 



 

2,345

 



 

1,815

 



 

4,310

 

Net income




$

2,165

 



$

3,973

 



$

3,000

 



$

6,881

 














 

Net income per common share:














Basic




$

0.33




$

0.62




$

0.46




$

1.07


Diluted




$

0.33




$

0.60




$

0.45




$

1.04















 

Weighted average number of common shares outstanding:











Basic