Rocky Brands, Inc. Announces Second Quarter 2026 Results

Rocky Brands, Inc. Announces Second Quarter 2026 Results NELSONVILLE, Ohio--( BUSINESS WIRE)--Rocky Brands, Inc. (NASDAQ: RCKY) today announced financial results for its second quarter ended June 30, 2026.

Second Quarter 2026 Overview

"Our second quarter performance was highlighted by 12% sales growth as demand further accelerated from the strong trends we experienced last year and early in 2026,” said Jason Brooks, Chairman, President and Chief Executive Officer. “Several of our brands grew strong double digits led by XTRATUF and followed by Georgia Boot and Rocky, as well as our Lehigh safety shoe business. Selling was robust across channels with particular strength on our direct-to-consumer websites, while strong bookings in the quarter will provide good Wholesale segment momentum for the second half of the year. The significant year-over-year improvement in earnings reflects the positive impact from the actual and expected recovery of IEEPA tariffs recognized in the second quarter. These refunds more than offset the incremental costs incurred as a result of adjusting our initial manufacturing, sourcing, and shipping plans to meet customer demand.”

Second Quarter 2026 Review

Second quarter 2026 net sales increased 12.0% to $118.4 million compared with $105.6 million in the second quarter of 2025. Wholesale segment net sales for the second quarter increased 7.9% to $78.8 million compared to $73.1 million in the second quarter of 2025. Retail segment net sales for the second quarter increased 21.8% to $36.2 million compared to $29.7 million in the second quarter of 2025. Contract Manufacturing segment net sales for the second quarter increased 17.2% to $3.3 million compared to $2.8 million in the second quarter of 2025.

Gross margin in the second quarter of 2026 was $60.8 million, or 51.4% of net sales, compared to $43.3 million, or 41.0% of net sales, for the same period last year. The increase in gross margin as a percentage of net sales was primarily due to the recognition of actual and expected IEEPA tariff refunds, which lowered cost of goods sold in the current quarter, partially offset by tariff costs and sourcing variances. The net impact of the tariff activity in the second quarter of 2026 was an approximate $15.0 million reduction to cost of goods sold.

Operating expenses were $41.1 million, or 34.7% of net sales, for the second quarter of 2026 compared to $36.1 million, or 34.2% of net sales, for the same period a year ago. Excluding $0.7 million of acquisition-related amortization in the second quarter of 2026 and 2025, adjusted operating expenses were $40.4 million, or 34.2% of net sales, in the current year period and $35.4 million, or 33.5% of net sales, in the year-ago period. The increase in operating expenses as a percentage of net sales was due to an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy in the second quarter of 2026.

Income from operations for the second quarter of 2026 was $19.7 million, or 16.6% of net sales, compared to $7.2 million, or 6.8% of net sales, for the same period a year ago. Adjusted income from operations for the second quarter of 2026 was $20.4 million, or 17.2% of net sales, compared to adjusted income from operations of $7.8 million, or 7.4% of net sales, a year ago, reflecting the net impact of tariffs, including the recognition of the aforementioned tariff refunds, in the second quarter of 2026.

Interest expense for the second quarter of 2026 was $2.1 million compared with $2.5 million for the prior year period. The decrease in interest expense was driven by lower debt levels.

The Company reported second quarter 2026 net income of $13.9 million, or $1.83 per diluted share, compared to $3.6 million, or $0.48 per diluted share, in the second quarter of 2025. Adjusted net income for the second quarter of 2026 was $14.4 million, or $1.90 per diluted share, compared to $4.1 million, or $0.55 per diluted share, in the year-ago period.

Balance Sheet Review

Cash and cash equivalents were $2.6 million as of June 30, 2026 compared to $2.8 million and $2.9 million as of June 30, 2025 and December 31, 2025, respectively.

Other receivables were $20.1 million as of June 30, 2026 compared to $0.1 million and $5.0 million as of June 30, 2025 and December 31, 2025, respectively. The increase in other receivables as of June 30, 2026 compared to June 30, 2025 and December 31, 2025 was primarily due to the IEEPA tariff refund receivable.

As of June 30, 2026, total debt, net of unamortized debt issuance costs of $1.5 million, was $122.4 million, consisting of a $22.6 million senior term loan and $101.3 million of borrowings under the Company's senior secured asset-backed credit facility. As of June 30, 2026, total debt, net of unamortized debt issuance costs, was down 7.6% from June 30, 2025, and was down 0.2% compared to December 31, 2025.

Inventories as of June 30, 2026, were $173.5 million, down 7.1% compared to $186.8 million on the same date a year ago and down 4.2% compared to $181.1 million as of December 31, 2025.

Conference Call Information

The Company's conference call to review second quarter 2026 results will be broadcast live over the internet today, Tuesday, July 28, 2026, at 4:30 pm Eastern Time. Investors and analysts interested in participating in the call are invited to dial (877) 704-4453 (domestic) or (201) 389-0920 (international). The conference call will also be available to interested parties through a live webcast at www.rockybrands.com. Please visit the website and select the “Investors” link at least 15 minutes prior to the start of the call to register and download any necessary software.

About Rocky Brands, Inc.

Rocky Brands, Inc. is a leading designer, manufacturer and marketer of premium quality footwear and apparel marketed under a portfolio of well recognized brand names. Brands in the portfolio include Rocky®, Georgia Boot®, Durango®, Lehigh®, The Original Muck Boot Company®, XTRATUF® and Ranger®. More information can be found at RockyBrands.com.

Safe Harbor Language

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. Those statements include, but may not be limited to, all statements regarding intent, beliefs, expectations, projections, forecasts, and plans of the Company and its management and include statements in this press release regarding the Company's expectation that strong bookings in the second quarter will provide momentum for the second half of the year (Paragraph 2). These forward-looking statements involve numerous risks and uncertainties, including, without limitation, the various risks inherent in the Company’s business as set forth in periodic reports filed with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K for the year ended December 31, 2025 (filed March 11, 2026) and quarterly report on Form 10-Q for the quarter ended March 31, 2026 (filed May 5, 2026). One or more of these factors have affected historical results and could in the future affect the Company’s businesses and financial results in future periods and could cause actual results to differ materially from plans and projections. Therefore, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation or warranty by the Company or any other person that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to the management of the Company. The Company assumes no obligation to update any forward-looking statements.

Rocky Brands, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(In thousands, except share amounts)

(Unaudited)

June 30,

December 31,

June 30,

2026

2025

ASSETS:

CURRENT ASSETS:

Cash and cash equivalents

2,627

2,902

2,779

Trade receivables – net

76,887

77,055

66,367

Other receivables

20,084

4,952

142

Inventories – net

173,525

181,134

186,836

Income tax receivable

1,050

Prepaid expenses

5,506

3,623

5,345

Total current assets

278,629

270,716

261,469

LEASED ASSETS

7,497

4,175

4,724

PROPERTY, PLANT & EQUIPMENT – net

52,360

49,929

50,908

GOODWILL

47,844

IDENTIFIED INTANGIBLES – net

101,639

103,033

104,428

OTHER ASSETS

1,939

1,791

1,647

TOTAL ASSETS

489,908

477,488

471,020

LIABILITIES AND SHAREHOLDERS' EQUITY:

CURRENT LIABILITIES:

Accounts payable

58,747

52,958

61,483

Current portion of long-term debt

8,361

Accrued expenses and other liabilities

26,759

34,813

24,931

Total current liabilities

93,867

96,132

94,775

LONG-TERM DEBT

114,030

114,281

124,167

LONG-TERM LEASES

5,110

1,727

2,156

DEFERRED INCOME TAXES

12,381

10,044

DEFERRED LIABILITIES

888

879

813

TOTAL LIABILITIES

226,276

225,400

231,955

SHAREHOLDERS' EQUITY:

Common stock, no par value;

25,000,000 shares authorized; issued and outstanding June 30, 2026 - 7,487,899; December 31, 2025 - 7,505,139; June 30, 2025 - 7,461,167

Additional paid-in-capital

74,935

76,090

74,470

Retained earnings

188,697

175,998

164,595

Total shareholders' equity

263,632

252,088

239,065

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

489,908

477,488

471,020

Rocky Brands, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(In thousands, except share amounts)

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

2026

2025

2026

2025

NET SALES

118,368

105,647

242,769

219,720

COST OF GOODS SOLD

57,564

62,366

136,531

129,431

GROSS MARGIN

60,804

43,281

106,238

90,289

OPERATING EXPENSES

41,119

36,125

82,919

74,427

INCOME FROM OPERATIONS

19,685

7,156

23,319

15,862

INTEREST EXPENSE AND OTHER – net

(1,995

)

(2,519

)

(4,029

)

(4,874

)

INCOME BEFORE INCOME TAX EXPENSE

17,690

4,637

19,290

10,988

INCOME TAX EXPENSE

3,809

1,029

4,151

2,438

NET INCOME

13,881

3,608

15,139

8,550

INCOME PER SHARE

Basic

1.85

0.48

2.01

1.15

Diluted

1.83

0.48

1.99

1.14

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING

Basic

7,509

7,461

7,522

7,460

Diluted

7,598

7,493

7,607

7,493

Rocky Brands, Inc. and Subsidiaries

Reconciliation of GAAP Measures to Non-GAAP Measures

(In thousands, except share amounts)

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

2026

2025

2026

2025

OPERATING EXPENSES

OPERATING EXPENSES, AS REPORTED

41,119

36,125

82,919

74,427

LESS: ACQUISITION-RELATED AMORTIZATION

(692

)

(692

)

(1,384

)

(1,384

)

ADJUSTED OPERATING EXPENSES

40,427

35,433

81,535

73,043

INCOME FROM OPERATIONS, AS REPORTED

19,685

7,156

23,319

15,862

ADJUSTED INCOME FROM OPERATIONS

20,377

7,848

24,703

17,246

NET INCOME

NET INCOME, AS REPORTED

13,881

3,608

15,139

8,550

TOTAL NON-GAAP ADJUSTMENTS

692

1,384

TAX IMPACT OF ADJUSTMENTS

(149

)

(154

)

(298

)

(307

)

ADJUSTED NET INCOME

14,424

4,146

16,225

9,627

NET INCOME PER SHARE, AS REPORTED

BASIC

1.85

0.48

2.01

1.15

DILUTED

1.83

0.48

1.99

1.14

ADJUSTED NET INCOME PER SHARE

BASIC

1.92

0.56

2.16

1.29

DILUTED

1.90

0.55

2.13

1.28

WEIGHTED AVERAGE SHARES OUTSTANDING

BASIC

7,509

7,461

7,522

7,460

DILUTED

7,598

7,493

7,607

7,493

Use of Non-GAAP Financial Measures

In addition to GAAP financial measures, we present the following non-GAAP financial measures: "non-GAAP adjusted operating expenses," "non-GAAP adjusted income from operations," "non-GAAP adjusted net income," and "non-GAAP adjusted net income per share." Adjusted results exclude the impact of items that management believes affect the comparability or underlying business trends in our consolidated financial statements in the periods presented. We believe that these non-GAAP measures are useful to management and investors and other users of our consolidated financial statements as an additional tool for evaluating operating performance. We believe they also provide a useful baseline for analyzing trends in our operations.

Investors should not consider these non-GAAP measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. See "Reconciliation of GAAP Measures to Non-GAAP Measures" accompanying this press release.

Definition

Usefulness to management and investors

Acquisition-related amortization

Amortization of acquisition-related intangible assets consists of amortization of intangible assets such as brands and customer relationships acquired in connection with the acquisition of the performance and lifestyle footwear business of Honeywell International Inc. Charges related to the amortization of these intangibles are recorded in operating expenses in our GAAP financial statements. Amortization charges are recorded over the estimated useful life of the related acquired intangible asset and are generally recorded over multiple years.

We excluded amortization charges for our acquisition-related intangible assets for purposes of calculating certain non-GAAP measures because these charges are inconsistent in size and are significantly impacted by the valuation of our acquisition. These adjustments facilitate a useful evaluation of our current operating performance and comparison to past operating performance and provide investors with additional means to evaluate cost and expense trends.