EX-99.1 2 v55562exv99w1.htm EX-99.1 exv99w1
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
     
Contacts:
   
 
   
David Carlson
  Michael Newman
Executive Vice President and
  Investor Relations
Chief Financial Officer
  StreetConnect, Inc.
LaCrosse Footwear, Inc.
  800-654-3517
503-262-0110 ext. 1331
  BOOT@stct.com
LACROSSE FOOTWEAR REPORTS FIRST QUARTER RESULTS
Quarterly Sales Up 32%; Strong Demand Across Multiple Sales Channels;
Strong Earnings Growth; Record Cash Position
Portland, Ore.—April 22, 2010 — LaCrosse Footwear, Inc. (Nasdaq: BOOT), a leading provider of premium, branded footwear for work and outdoor users, today reported results for the first quarter ended March 27, 2010.
For the first quarter of 2010, LaCrosse reported net sales of $34.2 million, up 32% from $25.9 million in the first quarter of 2009. Sales to the work market were $26.3 million for the first quarter of 2010, up 38% from $19.0 million for the same period of 2009. The growth in the work market sales reflects very strong demand from various areas of the U.S. government, as well as increasing demand from various niche work markets. Sales to the outdoor market were $7.9 million for the first quarter of 2010, up 15% from $6.9 million for the same period in 2009, reflecting an improved retail environment and increasing demand for the LaCrosse brand’s cold weather and hunting products.
The strong growth in sales and margins resulted in significant earnings growth. Net income was $1.7 million or $0.25 per diluted share in the first quarter of 2010, up from a net loss of $0.7 million or ($0.11) per diluted share in the first quarter of 2009.
Gross margin for the first quarter of 2010 was 40.2% of net sales, compared to 37.9% in the same period of 2009, primarily reflecting improved manufacturing efficiencies in the Company’s domestic manufacturing facility. LaCrosse’s operating expenses were $11.0 million in the first quarter 2010, up 2% from the first quarter 2009. The modest year-over-year increase reflects the Company’s reallocation of operating expenditures in order to expand its domestic sales, marketing and product development efforts, as well as increased incentive compensation expense recognized due to higher quarterly profits.
The Company continued to strengthen its balance sheet. At the end of the first quarter 2010, LaCrosse had record cash and cash equivalents of $19.7 million, up from $12.1 million at the end of the first quarter 2009, after paying dividends of $9.6 million to its shareholders since the first quarter of 2009. The Company reduced its inventory by $6.1 million or 22% from the first quarter of 2009, reflecting stronger than anticipated overall demand in the first quarter and an inventory reduction in preparation for significant new core products for Fall 2010.
“We’re very pleased with our strong sales and earnings growth in the first quarter of 2010, driven by increased demand across our different channels and markets,” said Joseph P. Schneider, president and CEO

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of LaCrosse Footwear, Inc. “We saw very strong demand from various branches of the U.S. government due to the continued strengthening of our customer relationships throughout the government channel and our strong execution in exceeding their delivery timetables. We also saw much stronger at-once demand from our wholesale channel partners during the first quarter, reflecting the improved consumer spending environment and success of our core products.
“During 2010, we continue to expect quarter-to-quarter fluctuations in the timing of government channel orders. Yet the general trends across our different channels look significantly more positive than a year ago and our new products are being very well received by our customers. In preparation for future growth, we recently announced our plans for a new production facility in Portland that will significantly increase our capacity to efficiently meet growing worldwide demand and extend our great tradition of superior craftsmanship.”
Based on the Company’s financial position, the Board of Directors today announced the approval of a quarterly dividend of $0.125 per share of common stock. The second quarter dividend will be paid on June 18, 2010 to shareholders of record as of the close of business on May 22, 2010. The Board of Directors, while not declaring future dividends to be paid, has established a quarterly dividend policy reflecting its intent to declare and pay a quarterly dividend of $0.125 per share of common stock for the balance of 2010.
First Quarter 2010 Conference Call
LaCrosse will host a conference call to discuss its financial results for the first quarter of 2010 on April 22, 2010 at 2:00 PM Pacific (5:00 PM Eastern). A broadcast of the conference call will be available at www.lacrossefootwearinc.com under “Investor Events” or by calling 877-941-0844 or +1 480-629-9645. A 48-hour replay will be available by calling 800-406-7325 or +1 303-590-3030 (Access Code: 4282450). A replay will also be available on the Company’s Web site.
About LaCrosse Footwear, Inc.
LaCrosse Footwear, Inc. is a leading developer and marketer of branded, premium and innovative footwear for work and outdoor users. The Company’s trusted Danner® and LaCrosse® brands are sold to a network of specialty retailers and distributors in the United States, Canada, Europe and Asia. Work consumers include people in law enforcement, transportation, mining, oil and gas exploration and extraction, construction, military services and other occupations that require high-performance and protective footwear as a critical tool for the job. Outdoor consumers include people active in hunting, outdoor cross-training, hiking and other outdoor recreational activities. For more information about LaCrosse Footwear products, please visit our Internet websites at www.lacrossefootwear.com and www.danner.com. For additional investor information, see our corporate website at www.lacrossefootwearinc.com.
Forward-Looking Statements
All statements, other than statements of historical facts, included in this release, including without limitation, any statements regarding future timing of government channel orders on a quarterly basis, our positive view of current trends across our channels, the assessment of our customers’ acceptance of our new products, the anticipated positive impact of our new Portland manufacturing facility significantly increasing our capacity to efficiently meet growing worldwide demand and extend our great tradition of superior craftsmanship and

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the Board of Directors intent to declare and pay dividends in future periods are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “plan,” “expect,” “aim,” “believe,” “project,” “target,” “anticipate,” “intend,” “estimate,” “will,” “should,” “could” and other terms of similar meaning, typically identify such forward-looking statements. The Company assumes no obligation to update or revise any forward-looking statements to reflect the occurrence or non-occurrence of future events or circumstances.
Forward-looking statements are based on certain assumptions and expectations of future events and trends that are subject to risks and uncertainties. Risk factors and other uncertainties which may directly impact the outcome of such forward-looking statements included in this release, each of which are included in our 2009 Annual Report on Form 10-K, as supplemented by our quarterly reports on Form 10-Q for 2010, include the following:
    There are uncertainties related to our sales to the U.S. government, which may not continue at the current levels or we may not be able to fill such orders on a timely basis due to facility constraints.
 
    Because we depend on third party manufacturers primarily in China for the majority of our products, we face challenges in maintaining a timely supply of goods to meet sales demand, and we may experience delay or interruptions in our supply chain. Any shortfall or delay in the supply of our products may decrease our sales and have an adverse impact on our customer relationships.
 
    We source approximately two-thirds of our finished goods from third party manufacturers primarily located in China. Our product costs are subject to risks associated with foreign currency fluctuations, commodity price increases and higher foreign labor costs. If we are unable to increase our selling prices to offset such cost increases, our revenues and earnings would be negatively impacted.

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LaCrosse Footwear, Inc.
Condensed Consolidated Statements of Operations

(Amounts in thousands, except share and per share amounts)
(Unaudited)
                 
    Quarter Ended  
    March 27,     March 28,  
    2010     2009  
Net sales
  $ 34,227     $ 25,910  
Cost of goods sold
    20,459       16,079  
 
           
Gross profit
    13,768       9,831  
Operating expenses
    11,037       10,869  
 
           
Operating income (loss)
    2,731       (1,038 )
Non-operating expense
    (22 )     (52 )
 
           
Income (loss) before income taxes
    2,709       (1,090 )
Income tax provision (benefit)
    1,047       (398 )
 
           
Net income (loss)
  $ 1,662     $ (692 )
 
           
 
               
Net income (loss) per common share:
               
Basic
  $ 0.26     $ (0.11 )
Diluted
  $ 0.25     $ (0.11 )
 
               
Weighted average number of common shares outstanding:
               
Basic
    6,371       6,274  
Diluted
    6,529       6,274  
 
               
Supplemental Product Line Information
               
Work Market Sales
  $ 26,363     $ 19,043  
Outdoor Market Sales
    7,864       6,867  
 
           
 
  $ 34,227     $ 25,910  
 
           

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LaCrosse Footwear, Inc.
Condensed Consolidated Balance Sheets

(Amounts in thousands)
(Unaudited)
                         
    March 27,     December 31,     March 28,  
    2010     2009     2009  
Assets:
                       
Current Assets:
                       
Cash and cash equivalents
  $ 19,713     $ 17,739     $ 12,059  
Trade and other accounts receivable, net
    16,933       21,635       18,190  
Inventories, net
    21,928       27,031       28,023  
Prepaid expenses and other
    1,026       1,129       1,169  
Deferred tax assets
    1,552       1,503       1,466  
 
                 
Total current assets
    61,152       69,037       60,907  
 
                       
Property and equipment, net
    8,446       8,482       7,585  
Goodwill
    10,753       10,753       10,753  
Other assets
    369       313       310  
 
                 
Total assets
  $ 80,720     $ 88,585     $ 79,555  
 
                 
 
                       
Liabilities and Shareholders’ Equity:
                       
Current Liabilities:
                       
Accounts payable
  $ 7,211     $ 8,036     $ 8,352  
Accrued compensation
    2,088       3,343       1,588  
Other accruals
    3,012       3,755       1,689  
 
                 
Total current liabilities
    12,311       15,134       11,629  
 
                       
Deferred revenue
    188       225       338  
Deferred lease obligations
    635       614       294  
Compensation and benefits
    4,493       4,680       5,634  
Deferred tax liabilities
    2,211       2,337       1,273  
 
                 
Total liabilities
    19,838       22,990       19,168  
 
                 
 
                       
Total shareholders’ equity
    60,882       65,595       60,387  
 
                 
Total liabilities and shareholders’ equity
  $ 80,720     $ 88,585     $ 79,555  
 
                 

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LaCrosse Footwear, Inc.
Condensed Consolidated Statements of Cash Flows

(Amounts in thousands)
(Unaudited)
                 
    March 27,     March 28,  
    2010     2009  
Cash flows from operating activities:
               
Net income (loss)
  $ 1,662     $ (692 )
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
               
Depreciation and amortization
    688       662  
Stock-based compensation expense
    234       227  
Deferred income taxes
    (175 )     338  
Loss on disposal of property and equipment
          37  
Changes in operating assets and liabilities:
               
Trade and other accounts receivable
    4,702       4,259  
Inventories
    5,103       595  
Accounts payable
    (825 )     (1,936 )
Accrued expenses and other
    (2,124 )     (2,294 )
 
           
Net cash provided by operating activities
    9,265       1,196  
 
           
 
               
Cash flows used in investing activities:
               
Purchases of property and equipment
    (682 )     (2,173 )
 
           
 
               
Cash flows used in financing activities:
               
Cash dividends paid
    (7,201 )     (787 )
Purchase of treasury stock
    (59 )      
Proceeds from exercise of stock options
    796       258  
 
           
Net cash used in financing activities
    (6,464 )     (529 )
 
           
 
               
Effect of foreign currency exchange rate changes on cash and cash equivalents
    (145 )     (118 )
 
           
 
               
Net increase (decrease) in cash and cash equivalents
    1,974       (1,624 )
Cash and cash equivalents:
               
Beginning of period
    17,739       13,683  
 
           
End of period
  $ 19,713     $ 12,059  
 
           
END OF FILING

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