Weyco (US:WEYS)2024-08-07 16:02Financial Data and Key Metrics Changes - Overall net sales for Q2 2024 were $63.9 million, down 5% from $67 million in Q2 2023 [5] - Consolidated gross earnings increased to 43.9% of net sales compared to 43.3% in the previous year [5] - Net earnings reached a record of $5.6 million or $0.59 per diluted share, up 15% from $4.9 million or $0.50 per diluted share last year [5] Business Line Data and Key Metrics Changes - North American wholesale segment net sales were $50.2 million, down 2% from $51.5 million in Q2 2023, with gross earnings at 38.2% of net sales compared to 37% last year [6][7] - Retail segment net sales remained flat at $7.6 million, with retail gross earnings as a percentage of net sales increasing to 67.5% from 66.2% [8] - Florsheim Australia net sales were $6.1 million, down 23% from $7.9 million in Q2 2023, with operating earnings decreasing to $200,000 from $300,000 [11] Market Data and Key Metrics Changes - The BOGS brand experienced a 33% decline in sales for the quarter, attributed to inventory over-saturation and mild winters [19] - Retail sales were flat, with Nunn Bush and Stacy Adams experiencing slight declines, while BOGS and Florsheim had low single-digit increases [22] - Florsheim Australia's results were impacted by the loss of a significant wholesale customer and inflationary pressures affecting consumer spending [23] Company Strategy and Development Direction - The company aims to enhance its presence in the casual lifestyle segment, focusing on hybrid and athleisure styles to appeal to modern consumers [18] - There is a commitment to maximizing leadership in refined footwear while adapting to market trends [17] - The strategy includes improving the BOGS brand's presence in the workwear category and introducing durable, lighter insulated boots [21] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for the fall selling season, noting conservative order bookings from retailers [15] - The company is focused on controlling costs and turning around its Australian retail and wholesale businesses [24] - Management acknowledged the impact of inflation on consumer demand and the need to adapt to changing market conditions [4][23] Other Important Information - Interest income totaled $1 million in Q2 2024, up from $200,000 in the previous year, due to higher cash balances [12] - The company declared a cash dividend of $0.26 per share, payable on September 30, 2024 [13] Q&A Session Summary Question: Congratulations on another great quarter - Management appreciated the acknowledgment of their efforts [28] Question: What is At once business? - At once business refers to orders that come in without prior commitments from retailers, allowing for more flexibility in inventory management [31][32] Question: Is trade still an issue regarding freight costs? - Freight costs have normalized since their peak in 2022, and the company is now working with lower-cost inventory [35][36] Question: How does the company analyze BOGS sales geographically? - The company looks at geographic sales patterns and aims to build products that are less dependent on weather conditions [39][40]