Weyco (WEYS)2025-03-05 22:23Financial Data and Key Metrics Changes - Overall net sales for Q4 2024 were 80.6 million in Q4 2023 [5] - Consolidated gross earnings were 47.9% of net sales for the quarter, down from 50.3% in the previous year [5] - Net earnings for Q4 2024 were 1.04 per diluted share, compared to 0.90 per diluted share in Q4 2023 [6] - Full-year consolidated net sales were 318 million in 2023 [14] - Full-year net earnings were a record 3.16 per diluted share, compared to 3.17 per diluted share in 2023 [14] Business Line Data and Key Metrics Changes - In the North American wholesale segment, Q4 net sales were 59.6 million last year [6] - North American retail segment net sales were 13.9 million in 2023 [8] - Florsheim Australia net sales were 7.2 million in Q4 2023 [11] - For the full year, North American wholesale net sales were 250 million in 2023 [14] - Retail operating earnings totaled 6.8 million in 2023 [18] Market Data and Key Metrics Changes - BOGS sales declined 17% in Q4 due to mild winter weather impacting demand [27] - Florsheim brand sales increased by 22% in Q4, while Stacy Adams faced challenges in the dress footwear market [30][31] - Nunn Bush grew 4% in Q4, benefiting from its Comfortech line [33] - Florsheim Australia's sales were down 10% for the year, primarily due to fewer operating retail stores [20] Company Strategy and Development Direction - The company is focused on evolving its portfolio of brands to position for future growth despite short-term pressures [26] - Product innovation and expanding retail presence are key strategies for revitalizing the BOGS brand [30] - The company is negotiating price reductions with suppliers to mitigate the impact of new tariffs [22][37] Management's Comments on Operating Environment and Future Outlook - Management noted that consumers remain cautious amid economic uncertainty, affecting discretionary spending [26] - The company is optimistic about renewed interest in the BOGS category for fall 2025 [28] - Management expressed confidence in maintaining gross margins despite tariff impacts [37] Other Important Information - The company generated 9.7 million in dividends [23] - A special dividend of 21.6 million [24] - The company has no debt outstanding on its $40 million revolving line of credit [23] Q&A Session Summary Question: Can someone walk me through the mechanics of a tariff for Weyco Group? - Management explained that they must post a bond equal to the average tariffs paid monthly and pay customs upon clearance of goods [46][47] Question: What percentage of your cost of goods sold came from China last year? - Approximately 75% of purchases are from China, with India being the second largest source at about 15% [66] Question: What are the tariffs today on those other countries? - The tariff on leather shoes from China is currently 36%, while other countries have lower tariffs, typically around 8.5% [71][72] Question: Are your offshore vendors receptive to sharing part of the cost of the tariffs? - Management confirmed that long-term relationships with factories have led to cooperation in mitigating some costs, but price increases will still be necessary [83][89]