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Weyco Group Q3 earnings from operations increased 3%

Weyco Group
Weyco Group   Net earnings attributable to the Company rose 27%

Weyco Group announced financial results for the third quarter ended September 30, 2018.


Net sales for the third quarter of 2018 were $78.4 million, an increase of 2% compared to third quarter 2017 net sales of $76.9 million.

Earnings from operations increased 3% to $8.0 million in the third quarter of 2018, from $7.8 million in the third quarter of 2017.

Net earnings attributable to the Company rose 27% to $6.3 million in the third quarter of 2018, up from $4.9 million in last year's third quarter.

Net earnings were positively impacted by the lower U.S. federal tax rate this year.

Diluted earnings per share were $0.60 per share in the third quarter of 2018 and $0.48 per share in the third quarter of 2017.

Net sales in the North American wholesale segment, which include North American wholesale sales and licensing revenues, were $63.2 million in the third quarter of 2018, up 4% compared to $60.7 million in the third quarter of 2017.

Within the wholesale segment, net sales of the Stacy Adams brand were up 17% for the quarter, primarily due to higher sales to department stores and national shoe chains.

Florsheim net sales were up 8%, due to sales volume increases across the majority of distribution channels.

BOGS third quarter net sales were down 5% for the quarter, mainly with outdoor and online retailers. Net sales of the Nunn Bush brand were flat for the quarter. Licensing revenues were approximately $530,000 in both the third quarters of 2018 and 2017.

Gross earnings for the North American wholesale segment increased to 34.4% of net sales in the third quarter of 2018, from 33.9% of net sales in last year's third quarter.

Earnings from operations for the wholesale segment were $7.6 million in the third quarter of 2018, up 3% compared to $7.4 million in the same period last year. The increase was primarily due to higher sales and gross margins.

Net sales in the North American retail segment, which includes sales from the Company's Florsheim retail stores and its internet businesses in the United States, were $4.9 million in the third quarter of 2018, up 15% compared to $4.3 million in the third quarter of 2017.

Same store sales (which includes U.S. internet sales) were up 20% for the quarter, due mainly to increased sales on the Company's websites. Driven by higher online sales, retail earnings from operations rose to $428,000 in the third quarter of 2018, from $17,000 in the third quarter of 2017.

Other net sales, which include the wholesale and retail net sales of Florsheim Australia and Florsheim Europe, were $10.3 million in the third quarter of 2018, down 14% compared to $11.9 million in the third quarter of 2017.

The decrease was primarily due to a 16% reduction in net sales at Florsheim Australia.

In local currency, Florsheim Australia's net sales were down 9% for the quarter, with sales down in both its wholesale and retail businesses.

The weaker Australian dollar relative to the U.S. dollar also contributed to the decrease in Florsheim Australia's net sales this year. Earnings from operations of Florsheim Australia and Florsheim Europe were $8,000 in the third quarter of 2018, compared to $369,000 in the same period last year. The decline between years was primarily due to lower sales at Florsheim Australia.

 

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