Rocky Brands Inc. blasted past expectations in the fourth quarter, thanks to strength in its wholesale business.
While analysts polled by Yahoo Finance were looking for earnings per share of 20 cents in the period ended Dec. 31, Rocky earned 41 cents, up from 16 cents in the same period a year ago.
Net income was $3 million, up more than threefold from $900,000 in the fourth quarter of 2009. Although net revenue advanced just 8 percent to $66.7 million, gross margin improved 80 basis points to make up 36.5 percent of sales, while operating expenses fell 260 basis points.
Sales by segment were mixed. Wholesale revenue for the fourth quarter increased 14 percent to $52.5 million, while retail sales were flat at $12.4 million. Military segment sales nearly halved to $1.8 million, from $3.3 million.
Mike Brooks, Rocky’s chairman and CEO, said in a statement that the quarter’s performance exceeded both internal and external expectations.
“The consumer response to our new product introductions and brand extensions has been positive and is fueling additional demand across our account base. In addition to our sales increase, we reduced our operating expenses 5 percent in 2010 and more than 17 percent over the past two years,” Brooks added.
Overall, Rocky had a good 2010. The Nelsonville, Oh.-based firm earned a full-year net income of $7.7 million, or $1.14 a share last year, compared with a net income of $1.2 million, or 21 cents, in 2009. Net sales increased 10 percent to $252.8 million.
Rocky ended the quarter and year with $4.36 million in cash and cash equivalents, up significantly from $1.8 million a year ago. It also reduced its long-term debt by nearly $20 million.
“These recent accomplishments have us well positioned for profitable growth in 2011 and we look forward to returning even greater value to our shareholders in the years ahead,” said Brooks.