Rocky Brands' Q2 sales down by weaker outdoor business

14 Jul '06

3 min read

Rocky Brands Inc (RCKY) announced preliminary financial results for its second quarter ended June 30, 2006.

For the second quarter of 2006, the Company stated that based on preliminary, unaudited financial results, Rocky Brands expects to report net sales of approximately $57 million versus record net sales of $65.5 million in the second quarter of 2005.

It is important to note that the second quarter of 2005 included approximately $5.8 million of footwear sales to the military compared to zero footwear sales to the military in the second quarter of 2006. The Company also expects to report a diluted loss per share of between ($0.05) to ($0.10), versus diluted earnings per share of $0.50 last year.

Mike Brooks, Chairman and Chief Executive Officer, commented, "Our sales for the second quarter were negatively impacted primarily by weaker than expected results in our outdoor business for the month of June."

"We continue to experience softness in our traditional camouflage hunting apparel, coupled with challenges in our outdoor footwear, including increased competition and a shift in retail buying patterns."

"We are working hard to enhance our product assortment and improve our merchandising strategy in order to reinvigorate the top-line performance of our entire outdoor category. Importantly, our work, western and duty businesses combined were up double digits on a percentage basis year-over-year."

The Company also announced that it has refinanced the six-year, $30 million term loan it entered into with American Capital Strategies in January 2005. Rocky Brands stated that it has refinanced $15 million of the term loan with GMAC Commercial Finance at an interest rate of LIBOR plus 3.0 percent and the remaining $15 million of the term loan with American Capital Strategies at an interest rate of LIBOR plus 6.5 percent.

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