Rocky Shoes & Boots has received an order to fulfill a contract to the U.S. Military to produce “Hot Weather” boots for approximately $30.0 million. Shipment of the boots is expected to begin in the fourth quarter of fiscal 2005 with an estimated completion date of December 2006.
Mike Brooks, Chairman and Chief Executive Officer, stated, “We are extremely pleased to have received this order to fulfill this contract. Our ability to manufacture boots for the U.S. Military highlights the strength of our operating platform and underscores our growing position in the marketplace.”
The Company also reported preliminary results for the third quarter ended September 30, 2005. Based on current, un-audited financial results, Rocky expects to report net sales of approximately $94 million and diluted earnings per share between $1.13 and $1.15. This compares to earnings per share of 98 cents reported in the third quarter of 2004. For the fiscal year ending December 31, 2005, the Company now expects to report net sales in the range of $294 million to $296 million and earnings per share in the range of $2.25 to $2.29, versus earnings per share of $1.74 reported in fiscal 2004.
Mike Brooks further commented, “Our core outdoor footwear business was negatively impacted during the third quarter, primarily due to warm, dry weather in several of our major markets, as well as weak consumer confidence and a challenging retail environment. With that said, we are confident about our product offering and merchandising strategy for the Rocky brand and we remain focused on expanding our leadership status in the industry. Importantly, our work, western, and duty footwear categories continued to perform on or above plan.”
The Company also introduced preliminary guidance for fiscal 2006. Rocky currently anticipates its fiscal 2006 revenues will be in the range of $313 million to $318 million, including approximately $26 million related to the order to fulfill a contract to the U.S. Military. For fiscal 2006, the Company currently expects diluted earnings per share will be in the range of $3.05 to $3.15.
It is important to note that Rocky Shoes & Boots filed a registration statement with the Securities and Exchange Commission on September 15, 2005 for a follow-on equity offering of 2.6 million shares of common stock consisting of 2 million primary shares offered by the Company and 600,000 shares offered by certain selling stockholders. If the equity offering is completed, there will be dilution to the Company's forward looking guidance that is not currently reflected in the guidance issued today, October 17, 2005.
Mr. Brooks concluded, “We are very encouraged by the progress we have made during the year integrating our acquisition of EJ Footwear, diversifying our operations, and increasing our long-term growth opportunities. With our strong portfolio of brands – Rocky, Georgia Boot, Lehigh, Durango, and Dickies – our enhanced infrastructure and improved sourcing capabilities, we believe that our prospects are bright and this is reflected in our forecast for significant growth in fiscal 2006.”
