Weyco Reports Fourth Quarter And Full Year 2025 Results

Core Insights - Weyco Group, Inc. reported a decline in net sales and earnings for the fourth quarter and full year of 2025, primarily due to lower shipping volumes and increased tariffs impacting gross margins [1][10][20] Fourth Quarter 2025 Overview - Wholesale net sales decreased by 6% to $56.7 million compared to $60.4 million in Q4 2024, with significant declines in Nunn Bush and Stacy Adams brands, both down 13% [3] - Retail segment net sales fell by 5% to $13.3 million, affected by increased sales reserves related to e-commerce [5] - Overall net sales for the quarter were $76.8 million, down 5% from $80.5 million in Q4 2024, with gross earnings at 44.1% of net sales compared to 47.9% in the previous year [10] North American Wholesale Segment - For the full year 2025, wholesale net sales totaled $216.8 million, down 5% from $227.9 million in 2024, with Florsheim brand sales reaching a record $92.0 million, up 2% [13] - Gross earnings as a percentage of net sales were 37.5% in 2025, down from 40.2% in 2024, largely due to incremental tariffs [14] North American Retail Segment - Retail net sales for 2025 were $35.7 million, an 8% decrease from $38.7 million in 2024, primarily due to lower direct-to-consumer sales [15] - Retail gross earnings were 65.7% of net sales in 2025, slightly down from 65.9% in 2024 [16] Other Operations - Florsheim Australia's net sales increased by 12% to $6.8 million in Q4 2025, driven by growth in both wholesale and retail businesses [7] - For the full year, Florsheim Australia's net sales were relatively flat at $23.7 million, with operating losses totaling $0.7 million [17] Incremental Tariffs - The U.S. imposed incremental tariffs in early 2025, increasing product costs by 19% to 50%, which compressed gross margins [8] - A recent Supreme Court ruling invalidated the statutory basis for these tariffs, and the company is seeking refunds for approximately $16 million paid in 2025 [9] Financial Performance - The company reported net earnings of $23.1 million for 2025, down 24% from $30.3 million in 2024, with diluted earnings per share at $2.41, down from $3.16 [20] - The effective tax rate increased to 28.0% in 2025 from 23.9% in 2024, influenced by a valuation allowance on deferred tax assets [18] Dividend Declarations - On March 3, 2026, the Board of Directors declared a quarterly cash dividend of $0.27 per share, payable on March 31, 2026 [19]