Timing Issues Slow Q4 Growth for Cutter and Buck…

Cutter & Buck, Inc. finished out its fiscal year with a fourth quarter that showed signs of promise for the year to come. Unfortunately timing issues in shipping goods to retailers and the need to air freight in new merchandise to meet consumer demand cut into the bottom line, causing a dip in the full year number. Cutter & Buck posted sales of $36.6 million in the fourth quarter, an increase of 5.0% over the same period in the prior year.

Golf sales during the fourth quarter were down 2.6% compared to the prior year, but management pointed to a shift in the timing of deliveries during a conference call with analysts as the culprit here, with sales from Q4 shifting to Q1. Sales in the company’s corporate business unit were $15.9 million for the quarter, a 9.2% increase over the prior year.

Sales in the company’s specialty retail business unit decreased 11.0% during the fourth quarter. As with the Golf segment, management pointed to a shipping product shift here, but a shift back this time which produced a substantial sales increase in Q3. In total for the second half, sales increased 11.7% over the same period last year in the specialty retail business unit.

Sales in the other business unit also increased during the quarter primarily due to increased liquidation sales as the company liquidated most of the remaining discontinued classics inventory that was on hand at the end of the third quarter.

Gross margin during the quarter was 45.9%, a 210 basis-point decrease from the previous year, as higher than expected demand for new classics product necessitated an increase in the use of air freight in order to meet the company’s customers requirements. Net income was $2.9 million, a 1.5% increase over the fourth quarter last year.