Form 8-K - Current report

0000106532false00001065322024-11-052024-11-05

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 8-K

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CURRENT REPORT

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Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

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Date of Report (date of earliest event reported):  November 5, 2024

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WEYCO GROUP, INC.

(Exact name of registrant as specified in its charter)

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Wisconsin		0-9068		39-0702200
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

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333 W. Estabrook Blvd. P. O. Box 1188 Milwaukee, WI		53201
(Address of principal executive offices)		(Zip Code)

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Registrant’s telephone number, including area code: [phone]

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(Former name or former address, if changed since last report.)

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4(c))

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Securities registered pursuant to Section 12(b) of the Act:

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Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock - $1.00 par value per share	WEYS	The Nasdaq Stock Market

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

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Emerging growth company ☐

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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Item 2.02 Results of Operations and Financial Condition

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The following information is being furnished under Item 2.02 of Form 8-K:

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On November 5, 2024 Weyco Group, Inc. issued a press release announcing its financial results for the quarter ended September 30, 2024. A copy of this press release is attached as Exhibit 99.1 to this Form 8-K. The information under this Item 2.02, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

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Item 9.01 Financial Statements and Exhibits

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(d) Exhibits

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99.1	Press release issued by the registrant on November 5, 2024.
104	Cover Page Interactive Data File (formatted as inline XBRL)

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Signature

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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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Date: November 5, 2024	WEYCO GROUP, INC.
	/s/ Judy Anderson
	Judy Anderson
	Vice President, Chief Financial Officer and Secretary

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Exhibit 99.1

WEYCO REPORTS THIRD QUARTER 2024 SALES AND EARNINGS;

DECLARES SPECIAL CASH DIVIDEND OF $2.00 PER SHARE

Milwaukee, Wisconsin---November 5, 2024---Weyco Group, Inc. (NASDAQ: WEYS) (“we,” “our,” “us” and the “Company”) today announced financial results for the quarter ended September 30, 2024.

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Third Quarter 2024 Overview

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Net sales: $74.3 million (down 12% compared to $84.2 million in Q3 2023)

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Gross earnings: 44.3% of net sales (up from 43.0% of net sales in Q3 2023)

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Earnings from operations: $10.2 million (down 18% compared to $12.4 million in Q3 2023)

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Net earnings: $8.1 million (down 14% compared to $9.3 million in Q3 2023)

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Diluted earnings per share: $0.84 (down from $0.98 in Q3 2023)

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North American Wholesale Segment

Net sales in our wholesale segment were $61.1 million in the third quarter of 2024, down 12% from $69.5 million in the third quarter of 2023. The decrease was primarily due to lower sales of our Nunn Bush, Stacy Adams, and BOGS brands. Nunn Bush third-quarter sales were down 20%, due in part to the previously disclosed shift in timing of shipments to a large retailer from third to second quarter, but also due to lower demand. Stacy Adams sales were down 17% for the quarter due to lower demand, particularly in the dress-shoe category.  Florsheim’s third-quarter sales were up 1%.

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BOGS sales were down 18% for the quarter. While outdoor retailer inventory levels have normalized which positively impacted BOGS third-quarter performance relative to the first half of 2024, BOGS at-once orders did not reach their expected potential due to unseasonably warm and dry weather throughout the country. BOGS fourth-quarter sales will largely depend on colder weather to bolster growth.  

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Wholesale gross earnings as a percent of net sales increased to 40.1% compared to 38.6% of net sales last year. Wholesale selling and administrative expenses were $15.1 million for the quarter versus $15.6 million last year, down due to lower employee costs, mainly commission-based compensation. As a percent of net sales, wholesale selling and administrative expenses were 25% and 22% in the third quarters of 2024 and 2023, respectively. The increase as a percent of net sales was because many of our costs are fixed in nature and do not vary with sales. Wholesale operating earnings totaled $9.4 million for the quarter, down 16% from $11.3 million in 2023, as a result of lower sales.

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North American Retail Segment

Net sales in our retail segment, which were generated mainly by our e-commerce websites, were $7.2 million for the quarter, down 5% from $7.6 million in 2023.  Lower sales on our BOGS website, a result of the mild Fall, were partially offset by higher sales on our Florsheim and Stacy Adams websites this quarter.

Retail gross earnings as a percent of net sales were 66.9% and 65.4% in the third quarters of 2024 and 2023, respectively. Retail operating earnings totaled $0.8 million for the quarter versus $0.9 million last year.

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Other Operations

Our other operations historically included our retail and wholesale businesses in Australia, South Africa, and Asia Pacific (collectively, “Florsheim Australia”). We ceased operations in the Asia Pacific region in 2023 and have substantially completed the wind down of that business. As a result, the third-quarter 2024 operating results of the “other” category only reflect that of Australia and South Africa.

Net sales of Florsheim Australia were $6.0 million, down 15% from $7.1 million in the third quarter of 2023. The decrease was almost entirely due to the closing of our Asia Pacific operations.  Sales in Australia were down 1% for the quarter, due to the impact of four fewer retail stores operating compared to the same period last year.  Australia’s same store sales were up 1% for the quarter.

Florsheim Australia’s gross earnings were 59.2% of net sales for the quarter and 61.6% of net sales last year.  Florsheim Australia’s operating earnings were zero for the period down from $0.3 million last year.

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Other Income / (Expense)

Interest income totaled $0.9 million in the third quarter of 2024 compared to $0.3 million in last year’s third quarter. This year included interest earned on higher cash balances in the U.S. and Canada.

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“This was a challenging quarter for our North American businesses,” stated Thomas W. Florsheim, Jr., Chairman and CEO. “All our wholesale brands were impacted by soft consumer demand resulting from cutbacks in discretionary spending. Additionally, BOGS at-once and e-commerce performance was more muted than anticipated due to the mild start to Fall.  While the retail landscape remains uncertain, we remain confident in the strength of our brands, and believe that each is well-positioned in its respective market for growth when conditions improve.”

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Dividend Declarations

On November 5, 2024, our Board of Directors declared a regular quarterly cash dividend of $0.26 per share to all shareholders of record on November 18, 2024, payable January 2, 2025. Additionally, as announced in a separate news release, on November 5, 2024, our Board of Directors declared a special one-time cash dividend of $2.00 per share to all shareholders of record on November 18, 2024, payable January 2, 2025.

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“We are pleased to announce this return of capital to shareholders,” stated Thomas W. Florsheim, Jr., Chairman and CEO.  “Our strong financial performance over the past few years led to a buildup of cash in excess of the amount necessary to fund operations, capital expenditures, and fulfill corporate obligations. As a result, we are returning capital to shareholders in the form of a special one-time cash dividend alongside our regular quarterly dividend.  Looking ahead, we believe our strong balance sheet and liquidity will continue to allow us to fund organic growth, invest in our business, and remain opportunistic with respect to future strategic opportunities or share repurchases.”

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Conference Call Details

Weyco Group will host a conference call on November 6, 2024, at 11:00 a.m. Eastern Time to discuss the third quarter 2024 financial results in more detail.  To participate in the call, you will first need to pre-register online. Pre-registration takes only a few minutes, and you may pre-register at any time, including up to and after the call start time. To pre-register, please go to: https://register.vevent.com/register/BIa7616a5c835846dca8d158b49e238d1b.

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The pre-registration process will provide the conference call phone number and a passcode required to enter the call. A replay will be available for one year beginning about two hours after the completion of the call at the following webcast link: https://edge.media-server.com/mmc/p/gccmoesr. The conference call will also be available in the investor relations section of Weyco Group’s website at www.weycogroup.com.

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About Weyco Group

Weyco Group, Inc., designs and markets quality and innovative footwear principally for men, but also for women and children, under a portfolio of well-recognized brand names including: Florsheim, Nunn Bush, Stacy Adams, BOGS, Rafters, and Forsake. The Company’s products can be found in leading footwear, department, and specialty stores, as well as on e-commerce websites worldwide.  Weyco Group also operates Florsheim stores in the United States, Australia, and South Africa.

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Forward-Looking Statements

This press release contains certain forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Various factors could cause our results to be materially different from the results expressed or implied by such forward-looking statements. Such factors include, but are not limited to, the impact of inflation generally and, specifically, increases in our costs for materials, labor and other manufacturing inputs, a slow down or contraction in the overall U.S. or Australian economies, our ability to successfully market and sell our products in a highly competitive industry and in view of changing and unpredictable consumer trends, the effect of unseasonable weather conditions on the demand for certain of our products, our ability to successfully procure our products from independent manufacturers on a timely basis, consumer acceptance of products and other factors affecting retail market conditions, changes in interest rates, the uncertain impact of the wars in Ukraine and Israel and the related economic and other sanctions imposed by the U.S. and European Union, and other factors detailed from time to time in our filings made with the Securities and Exchange Commission, including our annual report on Form 10-K filed on March 14, 2024, which are incorporated herein by reference. We undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise.

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For more information, contact:

Judy Anderson

Vice President, Chief Financial Officer and Secretary

414-908-1833

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WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
(UNAUDITED)

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Three Months Ended September 30,

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Nine Months Ended September 30,

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2024

2023

2024

2023

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(In thousands, except per share amounts)

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Net sales

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$

74,329

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$

84,150

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$

209,819

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$

237,458

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Cost of sales

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41,427

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47,997

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116,818

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135,136

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Gross earnings

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32,902

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36,153

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93,001

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102,322

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Selling and administrative expenses

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22,739

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23,720

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67,926

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72,803

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Earnings from operations

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10,163

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12,433

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25,075

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29,519

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Interest income

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894

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269

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2,763

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598

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Interest expense

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(15)

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(5)

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(15)

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(522)

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Other expense, net

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(185)

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(133)

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(423)

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(431)

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Earnings before provision for income taxes

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10,857

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12,564

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27,400

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29,164

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Provision for income taxes

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2,794

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3,227

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7,080

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7,518

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Net earnings

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$

8,063

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$

9,337

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$

20,320

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$

21,646

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Weighted average shares outstanding

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Basic

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9,439

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9,451

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9,435

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9,458

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Diluted

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9,599

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9,530

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9,576

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9,539

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Earnings per share

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Basic

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$ 0.85

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$ 0.99

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$ 2.15

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$ 2.29

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Diluted

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$ 0.84

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$ 0.98

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$ 2.12

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$ 2.27

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Cash dividends declared (per share)

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$ 0.26

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$ 0.25

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$ 0.77

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$ 0.74

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Comprehensive income

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$

9,055

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$

8,656

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$

20,427

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$

21,104

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WEYCO GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)

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​	​	​	​	​	​	​
​		September 30,			December 31,
​	​	2024		​	2023
​	​	(Dollars in thousands)
ASSETS:		​			​
Cash and cash equivalents	​	$	75,455	​	$	69,312
Marketable securities, at amortized cost	​		365	​		215
Accounts receivable, net	​		46,804	​	​	39,275
Income tax receivable	​	​	—	​	​	245
Inventories	​		72,187	​		74,890
Prepaid expenses and other current assets	​		3,071	​		6,172
Total current assets	​		197,882	​		190,109
​	​	​	​	​	​	​
Marketable securities, at amortized cost	​		6,009	​		6,354
Deferred income tax benefits	​		1,116	​		1,096
Property, plant and equipment, net	​		28,540	​		29,504
Operating lease right-of-use assets	​	​	11,472	​	​	12,520
Goodwill	​		12,317	​		12,317
Trademarks	​		33,168	​		33,168
Other assets	​		24,184	​		24,274
Total assets	​	$	314,688	​	$	309,342
​	​	​	​	​	​	​
LIABILITIES AND EQUITY:	​	​	​	​		​
Accounts payable	​	$	6,049	​	$	8,845
Dividend payable	​	​	—	​	​	2,352
Operating lease liabilities	​	​	4,167	​	​	3,979
Accrued liabilities	​		12,053	​		14,446
Accrued income tax payable	​		693	​		—
Total current liabilities	​		22,962	​		29,622
​	​	​	​	​	​	​
Deferred income tax liabilities	​		11,566	​		11,819
Long-term pension liability	​		13,541	​		13,412
Operating lease liabilities	​	​	8,129	​	​	9,531
Other long-term liabilities	​		367	​		465
Total liabilities	​		56,565	​		64,849
​	​	​	​	​	​	​
Common stock	​		9,559	​	​	9,497
Capital in excess of par value	​	​	72,661	​	​	71,661
Reinvested earnings	​		193,107	​		180,646
Accumulated other comprehensive loss	​		(17,204)	​		(17,311)
Total equity	​		258,123	​		244,493
Total liabilities and equity	​	$	314,688	​	$	309,342

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WEYCO GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

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​	​	​	​	​	​	​	​
​		Nine Months Ended September 30,
​	​	2024		​	2023		​
​	​	(Dollars in thousands)					​
CASH FLOWS FROM OPERATING ACTIVITIES:		​			​
Net earnings	​	$	20,320	​	$	21,646	​
Adjustments to reconcile net earnings to net cash provided by operating activities -	​		​	​		​	​
Depreciation	​		1,848	​		1,930	​
Amortization	​		199	​		204	​
Bad debt expense	​		19	​		107	​
Deferred income taxes	​		(351)	​		(82)	​
Net foreign currency transaction losses (gains)	​		79	​		(9)	​
Share-based compensation expense	​		1,086	​		996	​
Pension expense	​		693	​		970	​
Loss on disposal of fixed assets	​	​	34	​	​	—	​
Increase in cash surrender value of life insurance	​		(315)	​		(315)	​
Changes in operating assets and liabilities -	​		​	​		​	​
Accounts receivable	​		(7,534)	​		(6)	​
Inventories	​		2,728	​		48,442	​
Prepaid expenses and other assets	​		3,277	​		2,775	​
Accounts payable	​		(2,792)	​		(10,164)	​
Accrued liabilities and other	​		(2,937)	​		(4,331)	​
Accrued income taxes	​		940	​		775	​
Net cash provided by operating activities	​		17,294	​		62,938	​
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CASH FLOWS FROM INVESTING ACTIVITIES:	​			​			​
Proceeds from maturities of marketable securities	​		215	​		1,015	​
Purchases of property, plant and equipment	​		(900)	​		(2,565)	​
Net cash used for investing activities	​		(685)	​		(1,550)	​
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CASH FLOWS FROM FINANCING ACTIVITIES:	​		​	​		​	​
Cash dividends paid	​		(9,614)	​		(9,285)	​
Shares purchased and retired	​		(567)	​		(3,439)	​
Net proceeds from stock options exercised	​		—	​	​	33	​
Payment of contingent consideration	​		—	​		(500)	​
Taxes paid related to the net share settlement of equity awards	​		(4)	​	​	(173)	​
Proceeds from bank borrowings	​		—	​		70,060	​
Repayments of bank borrowings	​	​	—	​	​	(101,196)	​
Net cash used for financing activities	​		(10,185)	​		(44,500)	​
​	​	​	​	​	​	​	​
Effect of exchange rate changes on cash and cash equivalents	​		(281)	​		(367)	​
​	​	​	​	​	​	​	​
Net increase in cash and cash equivalents	​	$	6,143	​	$	16,521	​
​	​	​	​	​	​	​	​
CASH AND CASH EQUIVALENTS at beginning of period	​		69,312	​	​	16,876	​
​	​	​	​	​	​	​	​
CASH AND CASH EQUIVALENTS at end of period	​	$	75,455	​	$	33,397	​
​	​	​	​	​	​	​	​
SUPPLEMENTAL CASH FLOW INFORMATION:	​		​	​		​	​
Income taxes paid, net of refunds	​	$	6,251	​	$	6,462	​
Interest paid	​	$	15	​	$	971	​

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Document and Entity Information	Nov. 05, 2024
Document and Entity Information [Abstract]
Document Type	8-K
Document Period End Date	Nov. 05, 2024
Entity Registrant Name	WEYCO GROUP, INC.
Entity Incorporation, State or Country Code	WI
Entity File Number	0-9068
Entity Tax Identification Number	39-0702200
Entity Address, Address Line One	333 W. Estabrook Blvd.
Entity Address, Adress Line Two	P. O. Box 1188
Entity Address, City or Town	Milwaukee
Entity Address State Or Province	WI
Entity Address, Postal Zip Code	53201
City Area Code	414
Local Phone Number	908-1600
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock - $1.00 par value per share
Trading Symbol	WEYS
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false
Entity Central Index Key	0000106532
Amendment Flag	false

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