Weyco (US:WEYS)2025-11-07 18:54Sales Performance - Wholesale net sales decreased by 2% in dollars and 7% in volume for Q3 2025 compared to Q3 2024, with a 10% price increase implemented on July 1, 2025[52]. - Consolidated net sales for Q3 2025 were $73.1 million, down 2% from $74.3 million in Q3 2024, while year-to-date net sales totaled $199.4 million, a decrease of 5% from $209.8 million in 2024[61][62]. - The BOGS brand experienced a 17% sales decline in Q3 2025, attributed to an oversaturated outdoor footwear market and mild winters[57]. - Florsheim brand sales increased by 8% in Q3 2025, benefiting from its positioning in the traditional dress and dress-casual footwear market[55]. - Retail segment net sales declined by 4% in Q3 2025, driven by a decrease in e-commerce sales and increased price sensitivity among consumers[59]. - North American Wholesale segment net sales decreased by 2% to $60.151 million for Q3 2025, compared to $61.075 million in Q3 2024[74]. - Retail segment net sales totaled $6.953 million for Q3 2025, a decline of 4% from $7.225 million in Q3 2024[82]. - For the nine months ending September 30, 2025, total net sales decreased by 5% to $199.372 million compared to $209.819 million in the same period of 2024[74]. - Florsheim Australia's net sales remained flat at $6.0 million for Q3 2025, with a year-to-date decline of $0.7 million or 4% compared to the same period in 2024[87]. Earnings and Profitability - Consolidated gross earnings as a percentage of net sales fell to 40.7% in Q3 2025 from 44.3% in Q3 2024, primarily due to higher costs from incremental tariffs[67]. - Net earnings for Q3 2025 were $6.6 million, or $0.69 per diluted share, down 18% from $8.1 million, or $0.84 per diluted share, in Q3 2024[61]. - Consolidated earnings from operations decreased by 21% in Q3 2025, totaling $8.1 million compared to $10.2 million in Q3 2024[61]. - Earnings from operations for the North American Wholesale segment fell by 20% to $7.544 million in Q3 2025, down from $9.406 million in Q3 2024[74]. - Retail operating earnings declined by $1.4 million for the nine months ending September 30, 2025, compared to the same period in 2024[85]. - Gross earnings for the North American Wholesale segment were 35.7% of net sales in Q3 2025, down from 40.1% in Q3 2024[78]. Cash Flow and Liquidity - Cash and marketable securities totaled $78.5 million as of September 30, 2025, with no debt outstanding on the $40.0 million revolving line of credit[63]. - Net cash provided by operating activities totaled $13.2 million for the first nine months of 2025, down from $17.3 million in the same period last year[94]. - Cash dividends paid in the first nine months of 2025 totaled $7.7 million, compared to $9.6 million in the same period of 2024[97]. - Approximately $4.3 million of cash and cash equivalents was held by foreign subsidiaries as of September 30, 2025[103]. - The company believes that available cash, marketable securities, and cash provided by operations will support business cash needs for at least one year[103]. Tax and Financial Agreements - The effective tax rate for Q3 2025 was 26.3%, compared to 25.7% in Q3 2024[71]. - The effective tax rate for the nine months ending September 30, 2025, was 31.8%, compared to 25.8% in 2024, primarily due to a valuation allowance on deferred tax assets[92]. - The Amended Credit Agreement extended the maturity of the credit facility to September 25, 2026, with a maximum available borrowing limit of $40.0 million[100]. - The interest rate margin applicable to amounts outstanding was reduced by 15 basis points, now at SOFR plus 110 basis points[100]. - As of September 30, 2025, there were no outstanding borrowings on the line of credit, and the company was in compliance with all financial covenants[101]. Shareholder Returns - A total of $21.6 million in special cash dividends was prefunded in December 2024 and paid to shareholders in January 2025[102]. - The company continues to evaluate the best uses for available liquidity, including capital expenditures, stock repurchases, and acquisitions[103].