Rocky Brands(RCKY) - 2025 Q3 - Quarterly Results

Financial Performance - Net sales increased 7.0% to $122.5 million compared to $114.6 million in Q3 2024[5] - Net sales for the three months ended September 30, 2025, were $122.54 million, an increase of 6.4% compared to $114.55 million for the same period in 2024[21] - Income from operations rose 16.5% to $11.7 million, or 9.6% of net sales, compared to $10.1 million, or 8.8% of net sales, in Q3 2024[9] - Income from operations for the three months ended September 30, 2025, increased to $11.74 million, a 16.5% rise from $10.07 million in 2024[21] - Net income increased 36.6% to $7.2 million, or $0.96 per diluted share, compared to $5.3 million, or $0.70 per diluted share, in the prior year[11] - Net income for the three months ended September 30, 2025, was $7.21 million, compared to $5.28 million in 2024, reflecting a year-over-year growth of 36.6%[21] - Adjusted net income grew 33.4% to $7.8 million, or $1.03 per diluted share, compared to $5.8 million, or $0.77 per diluted share, in Q3 2024[11] - Adjusted net income for the three months ended September 30, 2025, was $7.75 million, up from $5.81 million in 2024, indicating a 33.5% increase[23] - Basic income per share for the three months ended September 30, 2025, was $0.96, compared to $0.71 for the same period in 2024, marking a 35.2% increase[23] Margins and Expenses - Gross margin improved by 210 basis points to 40.2% of net sales, up from 38.1% in the same quarter last year[8] - Gross margin for the three months ended September 30, 2025, was $49.28 million, representing a gross margin percentage of 40.2%, up from 38.1% in the same period of 2024[21] - Operating expenses were $37.6 million, or 30.6% of net sales, compared to $33.6 million, or 29.3% of net sales, in Q3 2024[7] - Operating expenses for the three months ended September 30, 2025, were $37.54 million, up from $33.58 million in 2024, reflecting an increase of 11.7%[21] Debt and Inventory - Total debt decreased 7.5% year-over-year to $139.0 million as of September 30, 2025[13] - Inventories increased 12.7% to $193.6 million compared to $171.8 million on the same date last year[14] Future Outlook - The company anticipates that price increases and diversified sourcing will help mitigate the impact of higher tariffs on margins in the coming quarters[4] - The strength of the brand portfolio and enhanced supply chain is expected to capture growth opportunities in 2026 and beyond[4] Non-GAAP Measures - Total non-GAAP adjustments for the three months ended September 30, 2025, amounted to $692,000, which impacted the comparability of financial results[24] - The company emphasizes the usefulness of non-GAAP measures for evaluating operating performance and trends in operations[24]