Rocky Brands (RCKY) Q4 2024 earnings summary

Executive summary

• Q4 2024 concluded with strong retail momentum and improved recurring wholesale sales, with net sales rising 1.7% to $128.1M, despite challenging year-over-year comparisons due to non-recurring 2023 sales and business model changes.

• Direct-to-consumer (DTC) channel achieved record sales, led by Durango and XTRATUF brands, with robust holiday demand.

• Adjusted net income for Q4 increased 22.7% to $8.9M; full-year adjusted net income up 32.9% to $19.0M.

• Gross margin improved both in Q4 (up 120 bps to 41.5%) and for the year (up 70 bps to 39.4%).

• Board authorized a new $7.5M share repurchase program, replacing the prior program.

Financial highlights

• Q4 sales rose 1.7% year-over-year to $128.1M; up 8.8% excluding non-recurring 2023 sales.

• Retail segment sales grew 15.3% (16.3% recurring) to $43.6M, the highest quarterly figure.

• Wholesale sales decreased 5.2% but increased 4.5% on a recurring basis; contract manufacturing up 39.1%.

• Q4 adjusted operating income was $13.2M; Q4 net income was $4.8M ($0.64/share); adjusted net income was $8.9M ($1.19/share).

• Full-year adjusted net income rose to $19M ($2.54/share), up from $14.3M ($1.93/share) last year.

Outlook and guidance

• 2025 revenue expected to grow low single digits over $453.8M, led by retail and steady wholesale, offset by lower contract manufacturing.

• Gross margins forecasted to decline modestly due to a 110 bps headwind from higher tariffs on China-sourced goods.

• SG&A to rise in dollars but remain similar as a percentage of revenue; interest expense to decrease.

• 2025 EPS projected just below 2024’s adjusted EPS, but up ~20% excluding tariff impact.

• Early 2025 sales momentum continues, driven by strong demand for Durango and XTRATUF brands and direct-to-consumer channel.