Weyco Group, Inc. said net fourth-quarter sales rose 3% to $62.2 million in 2007, compared with $60.6 million in 2006. Net earnings for the quarter were $7.8 million, up from $7.7 million during the same period in 2006. Diluted earnings per share were up 3% to $.66 in 2007 from $.64 in 2006.
Net sales in the wholesale division, which include wholesale sales and licensing revenues, were $52.8 million compared with $51.2 million in 2006. Wholesale sales were $51.5 million in 2007, up 3% from $50.0 million in 2006. Licensing revenues were $1.3 million in 2007 and $1.2 million in 2006.
Retail sales were flat in the fourth quarter of 2007, as compared with 2006. Same store sales were down 2%.
Operating earnings were $11.6 million, down 2% from $11.9 million in the prior year. Operating earnings as a percent of net sales were 18.7% in 2007 compared with 19.6% in 2006.
FULL YEAR 2007
Net sales of $232.6 million were up 5% compared with $221.0 million in the prior year. Net earnings were a record $22.9 million, up 5% from $21.9 million in 2006. Diluted earnings per share were $1.91 in 2007 and $1.81 last year.
Net sales in the wholesale division, which include wholesale sales and licensing revenues, were $201.5 million compared with $191.3 million in 2006. Wholesale sales were $197.4 million in 2007, up 5% from $187.2 million in 2006. Licensing revenues were $4.1 million in 2007 and 2006. Sales of the Company's Florsheim brand increased 14%, and sales of the Stacy Adams brand increased 5%. Sales of the Company's Nunn Bush brand were down 2% in 2007. The increase in Florsheim sales was due principally to the previously discussed change in Canadian distribution. Florsheim U.S. sales were up 4% for the year.
Retail sales increased 5% in 2007 to $31.1 million, up from $29.8 million in 2006. Same store sales were up 2%.
Operating earnings of $34.1 million increased 2% from $33.4 million in the prior year. Operating earnings as a percent of net sales were 14.7% in 2007 and 15.1% in 2006.
The company's balance sheet remains strong at Dec. 31, 2007. Cash and marketable securities totaled $56.8 million, as compared to $57.3 million in 2006. The company's borrowings under its revolving credit agreement were $550,000 compared with $11.0 million in 2006. Excess of cash and marketable securities over borrowings was $56.2 million compared with $46.3 million at December 31, 2006.
“We are very pleased that 2007 was a record year for Weyco Group in terms of both sales and profits,'' stated Tom Florsheim, Jr. Chairman and CEO of Weyco Group. “With that said, we started to see a slow down of retail footwear sales at our customers and in our own stores during the second half of the year, particularly in the fourth quarter. We feel that the slow down that we are seeing is caused by general economic factors, and that our brands are well positioned to grow over the long term.''
The Company's Board of Directors declared a cash dividend on Feb. 5, 2008 of $.11 per share to all shareholders of record on Feb. 20, 2008, payable April 2, 2008.
WEYCO GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS (Unaudited)
For the Quarter Ended For the Year Ended
December 31, December 31,
———————— ————————–
2007 2006 2007 2006
———– ———– ———— ————
NET SALES $62,225,011 $60,563,120 $232,616,656 $221,047,487
COST OF SALES 36,369,218 34,343,337 143,199,303 135,734,547
———– ———– ———— ————
Gross
earnings 25,855,793 26,219,783 89,417,353 85,312,940
SELLING AND
ADMINISTRATIVE
EXPENSES 14,228,019 14,321,282 55,285,340 51,868,545
———– ———– ———— ————
Earnings from
operations 11,627,774 11,898,501 34,132,013 33,444,395
INTEREST INCOME 530,068 472,598 2,158,983 1,940,976
INTEREST EXPENSE (65,215) (165,882) (352,905) (608,447)
OTHER INCOME AND
EXPENSE, net 17,527 15,875 24,891 13,627
———– ———– ———— ————
Earnings
before
provision
for income
taxes 12,110,154 12,221,092 35,962,982 34,790,551
PROVISION FOR
INCOME TAXES 4,287,000 4,485,000 13,062,000 12,935,000
———– ———– ———— ————
Net earnings $ 7,823,154 $ 7,736,092 $ 22,900,982 $ 21,855,551
=========== =========== ============ ============
BASIC EARNINGS
PER SHARE $.68 $.66 $1.98 $1.88
=========== =========== ============ ============
DILUTED EARNINGS
PER SHARE $.66 $.64 $1.91 $1.81
