Rocky Brands Inc. (RCKY, Financial) filed Annual Report for the period ended 2011-12-31.
Rocky Brands has a market cap of $88.8 million; its shares were traded at around $11.88 with a P/E ratio of 7.5 and P/S ratio of 0.4. Rocky Brands had an annual average earning growth of 5.8% over the past 10 years.
Gross margin. Gross margin decreased to $87.9 million or 36.7% of net sales for 2011 compared to $89.4 million or 35.4% of net sales for the prior year. Wholesale gross margin for 2011 was $66.9 million, or 34.8% of net sales, compared to $65.5 million, or 34.8% of net sales in 2010. Retail gross margin for 2011 was $20.7 million, or 46.2% of net sales, compared to $21.8 million, or 45.9% of net sales, in 2010. The 30 basis point increase was the result of higher average selling prices and increased sales from our consumer web business, which carries a higher margin, partially offset by a $0.8 million inventory adjustment in the fourth quarter resulting from our annual physical inventory. The adjustment was related to our retail store in Nelsonville, Ohio. We have implemented additional procedures to ensure the accuracy of the inventory going forward. Military gross margin in 2011 was $0.3 million, or 13.4% of net sales, compared to $2.1 million, or 12.4% of net sales in 2010.
SG&A expenses. SG&A expenses were $69.9 million, or 29.2% of net sales in 2011 compared to $72.3 million, or 28.6% of net sales for 2010. The net change primarily resulted from decreases in compensation and benefits expenses of $1.2 million, Lehigh mobile and store expenses of $0.8 million, legal and professional fees of $0.6 million, incentive accruals of $0.6 million and bad debt expenses of $0.3 million, partially offset by increases in advertising expenses of $0.8 million and freight expenses of $0.4 million.
Net sales. Net sales increased 10.2% to $252.8 million for 2010 compared to $229.5 million the prior year. Wholesale sales increased $14.0 million to $188.3 million for 2010 compared to $174.3 million for 2009. The increase in wholesale sales was the result of a $12.3 million or 15.6% increase in our work footwear category, a $2.3 million or 11.7% increase in our duty footwear category, and a $1.2 million or 4.0% increase in our western footwear category, which was partially offset by a $0.7 million or 5.6% decrease in our apparel category, a $0.6 million or 2.4% decrease in our outdoor footwear category and a $0.5 million decrease in other. Retail sales were $47.5 million in 2010 compared to $50.0 million for 2009. The $2.5 million decrease in retail sales resulted from our ongoing transition to more internet driven transactions and the decision to remove a portion of our Lehigh mobile stores from operations to help lower operating expenses. Military segment sales, which occur from time to time, were $17.0 million for 2010 compared to $5.2 million in 2009. Shipments in 2010 were primarily under the $29.0 million contract issued in July 2009. Shipments in 2009 were under the $6.4 million contract issued in July 2007 and the July 2009 contract. Average list prices for our footwear, apparel and accessories were similar in 2010 compared to 2009.
Gross margin. Gross margin increased to $89.4 million or 35.4% of net sales for 2010 compared to $84.6 million or 36.8% of net sales for the prior year. Wholesale gross margin for 2010 was $65.5 million, or 34.8% of net sales, compared to $60.6 million, or 34.8% of net sales in 2009. Retail gross margin for 2010 was $21.8 million, or 45.9% of net sales, compared to $23.4 million, or 46.9% of net sales, in 2009. The 100 basis point decrease reflected reduced sales via our mobile stores, which carry the highest gross margin in our retail business. Military gross margin in 2010 was $2.1 million, or 12.4% of net sales, compared to $0.6 million, or 10.7% of net sales in 2009. The shipments in 2010 under the $29.0 million contract had a higher gross margin than shipments under previous contracts.
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Rocky Brands has a market cap of $88.8 million; its shares were traded at around $11.88 with a P/E ratio of 7.5 and P/S ratio of 0.4. Rocky Brands had an annual average earning growth of 5.8% over the past 10 years.
Highlight of Business Operations:
Net sales. Net sales decreased 5.2% to $239.6 million for 2011 compared to $252.8 million the prior year. Wholesale sales increased $4.3 million to $192.6 million for 2011 compared to $188.3 million for 2010. The increase in wholesale sales was the result of a $11.2 million or 129.6% increase in our commercial military footwear category, a $1.3 million or 11.3% increase in apparel and accessories, a $1.0 million or 3.3% increase in our western footwear category, a $0.5 million or 2.1% increase in our outdoor footwear category and a $0.5 million or 3.9% increase in our duty footwear category, which were partially offset by a $7.4 million decline of our Dickies licensed business and a $2.8 million decrease in other footwear. Our licensing agreement with Dickies expired on December 31, 2010. Retail sales were $44.8 million in 2011 compared to $47.5 million for 2010. The $2.7 million decrease in retail sales resulted from our ongoing transition to more internet driven transactions and the decision to remove a portion of our Lehigh mobile stores from operations to help lower operating expenses and improve operating margins. Military segment sales, which occur from time to time, were $2.2 million for 2011 compared to $17.0 million in 2010. From time to time, we bid on military contracts when they become available. Our sales under such contracts are dependent on us winning the bids for these contracts. Average list prices for our footwear, apparel and accessories were higher in 2011 than 2010 as we increased our list prices to offset higher manufacturing and sourcing costs.Gross margin. Gross margin decreased to $87.9 million or 36.7% of net sales for 2011 compared to $89.4 million or 35.4% of net sales for the prior year. Wholesale gross margin for 2011 was $66.9 million, or 34.8% of net sales, compared to $65.5 million, or 34.8% of net sales in 2010. Retail gross margin for 2011 was $20.7 million, or 46.2% of net sales, compared to $21.8 million, or 45.9% of net sales, in 2010. The 30 basis point increase was the result of higher average selling prices and increased sales from our consumer web business, which carries a higher margin, partially offset by a $0.8 million inventory adjustment in the fourth quarter resulting from our annual physical inventory. The adjustment was related to our retail store in Nelsonville, Ohio. We have implemented additional procedures to ensure the accuracy of the inventory going forward. Military gross margin in 2011 was $0.3 million, or 13.4% of net sales, compared to $2.1 million, or 12.4% of net sales in 2010.
SG&A expenses. SG&A expenses were $69.9 million, or 29.2% of net sales in 2011 compared to $72.3 million, or 28.6% of net sales for 2010. The net change primarily resulted from decreases in compensation and benefits expenses of $1.2 million, Lehigh mobile and store expenses of $0.8 million, legal and professional fees of $0.6 million, incentive accruals of $0.6 million and bad debt expenses of $0.3 million, partially offset by increases in advertising expenses of $0.8 million and freight expenses of $0.4 million.
Net sales. Net sales increased 10.2% to $252.8 million for 2010 compared to $229.5 million the prior year. Wholesale sales increased $14.0 million to $188.3 million for 2010 compared to $174.3 million for 2009. The increase in wholesale sales was the result of a $12.3 million or 15.6% increase in our work footwear category, a $2.3 million or 11.7% increase in our duty footwear category, and a $1.2 million or 4.0% increase in our western footwear category, which was partially offset by a $0.7 million or 5.6% decrease in our apparel category, a $0.6 million or 2.4% decrease in our outdoor footwear category and a $0.5 million decrease in other. Retail sales were $47.5 million in 2010 compared to $50.0 million for 2009. The $2.5 million decrease in retail sales resulted from our ongoing transition to more internet driven transactions and the decision to remove a portion of our Lehigh mobile stores from operations to help lower operating expenses. Military segment sales, which occur from time to time, were $17.0 million for 2010 compared to $5.2 million in 2009. Shipments in 2010 were primarily under the $29.0 million contract issued in July 2009. Shipments in 2009 were under the $6.4 million contract issued in July 2007 and the July 2009 contract. Average list prices for our footwear, apparel and accessories were similar in 2010 compared to 2009.
Gross margin. Gross margin increased to $89.4 million or 35.4% of net sales for 2010 compared to $84.6 million or 36.8% of net sales for the prior year. Wholesale gross margin for 2010 was $65.5 million, or 34.8% of net sales, compared to $60.6 million, or 34.8% of net sales in 2009. Retail gross margin for 2010 was $21.8 million, or 45.9% of net sales, compared to $23.4 million, or 46.9% of net sales, in 2009. The 100 basis point decrease reflected reduced sales via our mobile stores, which carry the highest gross margin in our retail business. Military gross margin in 2010 was $2.1 million, or 12.4% of net sales, compared to $0.6 million, or 10.7% of net sales in 2009. The shipments in 2010 under the $29.0 million contract had a higher gross margin than shipments under previous contracts.
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