It is the last quarter that Saucony, Inc. will report quarterly numbers, and the brand showed little near-term upside for The Stride Rite Corporation, which hopes to close on the acquisition of Saucony in Q3.

Second quarter net sales at Saucony, Inc. decreased 8.8% to $40.1 million, compared to $44.0 million in the second quarter of 2004. The backlog of open orders scheduled for delivery through November was down 8.9% at quarter-end versus the same time last year. The 12-month backlog figure was down 9.7% at the end of June 2005.

Saucony brand domestic sales declined 14.4% to $25.8 million from $30.1 million in the year-ago period. Saucony brand international sales were up 11.3% to $9.1 million from $8.2 million in Q2 last year. Total worldwide Saucony brand sales were down 8.9% to $34.9 million from $38.4 million in the year-ago quarter.

Sales of Other Products, which includes HIND and owned-retail, declined 7.5% in the domestic market to $4.9 million in the second quarter, while international sales of Other Products fell 16.7% to $254,000.

Gross margins declined 7 basis points to 40.4% and SG&A expenses jumped 420 basis points to 33.4% of sales, due in large part to $802,000 in transaction costs related to the company’s search for a buyer and $150,000 in costs related to the settlement of a patent infringement lawsuit. These costs were offset a bit by lower incentive compensation during the quarter. Resulting net income decreased 44.4% to $1.7 million in Q2, compared to net income of $3.0 million in the year-ago period.