Weyco Group, Inc., the parent of Bogs and Rafters, reported sales for the fourth quarter increased 5 percent to $78.4 million from $74.8 million a year ago. Operating earnings increased 39 percent to $12.5 million, from $8.9 million in 2011.
Net earnings attributable to the Company were $7.7 million, compared to $5.5 million in 2011. Diluted earnings per share increased to 71 cents per share in 2012, from 50 cents per share in the fourth quarter of 2011. Earnings for the quarter included $1.8 million ($1.1 million after tax, or 10 cents per diluted share) of income resulting from a reduction in the liability for future payments to be made as a result of the 2011 acquisition of The Combs Company (“Bogs”).
Net sales in the North American wholesale segment, which include North American wholesale sales and licensing revenues, were $56.6 million for the fourth quarter of 2012, compared with $55.0 million in 2011. Wholesale product sales were $55.4 million in the fourth quarter of 2012, up from $53.8 million in 2011. Wholesale net sales of the Company’s Stacy Adams and Florsheim brands were each up 9 percent for the quarter, while Nunn Bush sales remained flat.
Wholesale net sales of the Company’s BOGS and Rafters brands collectively decreased 7 percent for the quarter. The decrease in the BOGS and Rafters business was primarily due to lower fourth quarter 2012 sales of the BOGS brand in the U.S. due to the mild winter. The decrease in BOGS U.S. business was partially offset by $2.5 million of BOGS net sales in Canada in the fourth quarter 2012, following the Company’s June 1, 2012 takeover of the Canadian distribution of the BOGS and Rafters brands from a third party licensee. Licensing revenues were $1.2 million in the fourth quarter of 2012 and 2011. Operating earnings for the wholesale segment were $9.1 million in the fourth quarter of 2012 compared to $6.0 million in 2011.
Net sales in the North American retail segment, which include sales from the Company’s Florsheim retail stores in the U.S. and its Internet business, were $7.6 million in the fourth quarter of 2012, compared with $7.5 million in 2011, an increase of 1 percent. Same store sales were up 8 percent for the quarter. There were seven fewer domestic retail stores as of December 31, 2012 compared to 2011. Operating earnings for the segment were $1.3 million in the fourth quarter of 2012 compared to $1.2 million in 2011.
Other net sales, which include the wholesale and retail net sales of Florsheim Australia and Florsheim Europe, were $14.1 million in the fourth quarter of 2012, compared to $12.3 million in 2011. The majority of other net sales were generated by Florsheim Australia. Florsheim Australia’s net sales were up 15 percent or $1.7 million.
Collectively, the operating earnings of the Company’s other businesses were $2.1 million in the fourth quarter of 2012 compared to $1.7 million in the same period last year.
FULL YEAR 2012
Overall net sales in 2012 were $293.5 million, an increase of 8 percent from 2011 sales of $271.1 million. Operating earnings increased 28 percent to $29.8 million in 2012, from $23.2 million in 2011. Net earnings attributable to the Company were $19.0 million in 2012, compared to $15.3 million in 2011. Diluted earnings per share increased to $1.73 per share in 2012, from $1.37 per share in the prior year. Earnings for the year included $3.4 million ($2.1 million after tax, or $0.19 per share) of income resulting from a reduction in the liability for future payments to be made as a result of the 2011 acquisition of Bogs.
In the North American wholesale segment, net sales were $217.9 million in 2012 compared with $199.1 million in 2011. Wholesale product sales were $214.6 million in 2011, up 10 percent from $195.7 million in 2011. Net sales of the BOGS and Rafters brands were $36 million in 2012 compared to $28 million in 2011. The Company’s 2012 results included Bogs operations for the full year, while 2011 only included Bogs operations from the March 2, 2011 acquisition date through December 31, 2011. In addition, Bogs had $6.9 million of sales in Canada in 2012, following the Company’s June 1, 2012 takeover of the distribution of the BOGS and Rafters brands in Canada. Wholesale net sales of Stacy Adams, Nunn Bush and Florsheim were up 10 percent, 1 percent, and 8 percent, respectively, for the year.
Licensing revenues were $3.3 million in 2012 compared to $3.4 million in 2011. The operating earnings of the wholesale segment were up $6.6 million, or 42 percent, for the year.
In the retail segment, net sales were $24.3 million, down 2 percent from $24.7 million in 2011. There were seven fewer stores at the end of 2012 compared to 2011. Same store sales were up 8 percent. The retail division’s operating earnings were $1.7 million in 2012 compared to $1.6 million in 2011 due to an improvement in same store performance as well as the closing of underperforming stores during the year.
The Company’s other businesses had net sales of $51.2 million in 2012 compared to $47.3 million in 2011. The majority of the increase was at Florsheim Australia, whose net sales increased $4.7 million, or 12 percent. Collectively, the operating earnings of the Company’s other businesses were $5.9 million in 2012 compared to $6.0 million in 2011.
“We are pleased to announce that we had sales growth across all of our wholesale brands in North America and internationally during 2012,” stated Tom Florsheim, Jr., Chairman and CEO of Weyco Group, Inc. “We feel that our brands are well-positioned in their respective markets for future growth.”
