LaCrosse Footwear, Inc. for the first quarter of 2007 reported consolidated net sales of $23.7 million, up 11% from $21.4 million in the first quarter of 2006. Net income was $0.6 million or 10 cents per diluted share in the first quarter of 2007, up 54% from $0.4 million or 6 cents per diluted share in the first quarter of 2006.
Sales to the work market were $15.4 million for the first quarter of 2007, up 13% from $13.6 million for the same period of 2006. Year-over-year growth in work sales reflects continued penetration into a variety of general and specialized work and uniform boot markets, as well as the early success of the company's new line of high-performance safety apparel. Sales to the outdoor market were $8.3 million for the first quarter of 2007, up 7% from $7.8 million for the same period of 2006. Year-over-year growth in the outdoor market primarily reflects continued penetration into the hunting and rugged outdoor boot markets.
The company's gross margin was a record 40.6% of net sales for the first quarter of 2007, up from 39.2% in the same period of 2006, an increase of 140 basis points. The year-over-year gross margin improvement was primarily the result of a price increase at the beginning of the first quarter of 2007 and fewer closeout sales during the quarter.
LaCrosse's total operating expenses were $8.8 million in the first quarter of 2007, down 5% sequentially from $9.2 million in the previous quarter, and up 12% from $7.8 million in the first quarter of 2006. The year-over-year increase primarily reflects the strategic expansion of our product development and sales teams, and costs related to our new Portland distribution center and offices.
As a result of anticipated lower seasonal demand in the first quarter, the Company reduced its inventory levels at March 31, 2007 by approximately $0.3 million or 1% from December 31, 2006. At the end of the first quarter of 2007, LaCrosse had cash and cash equivalents of $15.6 million, up 23% from $12.7 million at the end of 2006 and up 39% from $11.2 million at the end of the first quarter of 2006.
“We are pleased with our execution and financial performance for the first quarter, which is typically our slowest seasonal period,” said Joseph P. Schneider, president and CEO of LaCrosse Footwear, Inc. “Our sales and earnings growth continued to be driven by the success of our new products and our ability to meet at-once demand allowed us to capitalize on favorable weather conditions in the latter half of the quarter. We continue to increase our brand equity and capture market share in work and outdoor markets that are quality and performance driven. Moreover, we are very encouraged by the positive customer response to our new fall lines of Danner and LaCrosse products.”
“We further improved our gross margins and strengthened our balance sheet by remaining focused on target markets where our premium products, innovative technology and outstanding customer service create opportunities for sustainable and profitable growth. We also believe the significant investments in our organization and business infrastructure that we made in recent years are beginning to pay off, as we start to moderate operating expense increases and leverage our operating model.”
LaCrosse Footwear, Inc.
Condensed Consolidated Statements of Income
(Amounts in thousands, except per share amounts)
(Unaudited)
Quarter Ended
March 31, April 1,
2007 2006
Net sales $23,691 $21,401
Cost of goods sold 14,081 13,017
Gross profit 9,610 8,384
Operating expenses 8,780 7,821
Operating income 830 563
Non-operating income 121 50
Income before income taxes 951 613
Income tax expense 347 221
Net income $604 $392
Net income per common share:
Basic $0.10 $0.07
Diluted $0.10 $0.06
Weighted average number of common
shares outstanding:
Basic 6,055 5,998
Diluted 6,292 6,182
Supplemental Information
Work Market Sales $15,417 $13,645
Outdoor Market Sales 8,274 7,756
$23,691 $21,401
