Rocky Brands Inc. efforts to streamline business and cut costs is paying off. On Tuesday, the parent company to brands like Creative Recreation, Durango and Rocky, reported second quarter net sales were $58.5 million compared to $62.6 million in the second quarter of 2016. The company reported second quarter net income of $1.5 million, or 20 cents per diluted share compared to a net loss of $1.8 million, or 23 cents, in the second quarter of 2016.
Net sales were $121.5 million compared to $120.1 million for the six months ended June 30, 2017 and 2016, respectively. The company reported net income of $3.0 million, or 40 cents per diluted share compared to a net loss of $2.0 million, or 26 cents per diluted share for the six months ended June 30, 2017 and 2016, respectively.
Rocky Brands Inc. President and CEO Jason Brooks said the increase in second quarter profitability year-over-year reflects the work of more efficient company. “Through enhancements to our production facility in Puerto Rico along with a number of organizational changes aimed at reducing our expense structure we were able to improve operating profit by nearly $4.8 million,” Brooks stated.
Net sales for the second quarter decreased 6.6% to $58.5 million compared to $62.6 million a year ago. Wholesale sales for the second quarter decreased 10.5% to $37.1 million compared to $41.5 million for the same period in 2016. However, retail sales for the second quarter increased 5.8% to $11.0 million compared to $10.4 million for the same period last year.
Rocky’s military segment sales for the second quarter were $10.3 million compared to $10.7 million in the second quarter of 2016.
Gross margin in the second quarter of 2017 increased to $18.2 million, or 31.1% of sales, compared to $16.3 million, or 26 percent of sales, for the same period last year. The 510 basis point increase was driven by a significant improvement in both wholesale segment and military segment margins.
“Although wholesale sales decreased in the quarter, in part due to the discontinuation of a low margin private label program, we achieved higher gross margins due to less promotional sales as well as the discontinuation of the private label program,” Brooks said. “We are continuing to focus on designing and delivering high quality branded products which support higher gross margins.”