Rocky Brands sees sales drop as coronavirus hits wholesale channel
Nelsonville, Ohio-based footwear maker Rocky Brands, Inc. announced declining first-quarter sales on Tuesday, as disruptions related to the Covid-19 pandemic took their toll, principally on the company’s wholesale and military segments.
For the first quarter ended March 31, 2020, the company, which owns the Rocky, Georgia Boot, Durango and Lehigh brands, reported total net sales of $55.7 million, down 15.5% compared with $65.9 million in the prior-year period.
Wholesale sales fell from $42.4 million to $35.0 million, while the company’s military segment sales totaled $3.8 million, down from $8.1 million in the same period in the previous year. Retail sales, on the other hand, saw a 9.4% increase from $15.4 million to $16.9 million.
Rocky Brands’ total net income for the first quarter was $1.2 million, or $0.16 per diluted share, falling from $3.6 million, or $0.48 per diluted share, in the first quarter of fiscal 2019.
“Our business is holding up well despite one of the most difficult operating environments in our company’s long history,” said Rocky Brands CEO Jason Brooks in a release. “While we face challenges due to the Covid-19 pandemic, particularly within our brick and mortar wholesale channel as much of the country continues to shelter-at-home, we have taken decisive actions to capitalize on our digital and distribution center capabilities and increase liquidity.”
As part of its efforts to increase liquidity during the ongoing health crisis, the company has reduced operating expenses by around $1.5 million for the year, delayed approximately $15 million in planned inventory receipts from third-party suppliers, drawn down $20 million on its credit facility, and suspended all share repurchases indefinitely.
At the end of last month, Rocky Brands was deemed to be an essential business due to its focus on occupational footwear. This meant that the company’s Logan, Ohio-based distribution center has been able to continue operations despite the state’s stay-at-home order.
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