Weyco Group Reports Flat Sales but 10% Increase in Net Earnings for Q1 2026

Weyco Group, Inc. reported its financial results for the first quarter of 2026, revealing a consolidated net sales figure of $68.0 million, which remained flat compared to $68.03 million in the same period last year. The company’s net earnings increased by 10% to $6.1 million, or $0.64 per diluted share, up from $5.5 million, or $0.57 per diluted share, in the first quarter of 2025. Earnings from operations also saw a 7% rise, totaling $7.5 million compared to $7.0 million in the prior year, primarily due to lower selling and administrative expenses in the Wholesale segment.

In terms of segment performance, the North American Wholesale segment experienced a slight decline in net sales, down 1% to $53.6 million, while the North American Retail segment saw a 2% increase to $8.8 million. The Wholesale segment's decline was attributed to a 9% drop in sales for the Stacy Adams brand and an 11% decrease for BOGS, which were partially offset by a 5% increase in Florsheim sales. The Retail segment's growth was driven by strong e-commerce sales, particularly for the Florsheim brand, as the company worked through excess inventory from the previous year.

Weyco's operational cash flow significantly improved, generating $17.4 million in the first quarter, compared to $4.1 million in the same period last year. This increase was largely due to lower inventory levels. The company reported cash and marketable securities totaling $93.9 million as of March 31, 2026, with no outstanding debt on its $40 million revolving line of credit. However, cash dividends paid during the quarter rose sharply to $23.9 million, reflecting a timing difference in dividend payments compared to the previous year.

The company continues to navigate challenges posed by U.S. tariffs, which had previously increased product costs by 19% to 50%, leading to gross margin compression. Following a recent Supreme Court ruling that invalidated certain tariffs, Weyco has submitted claims for potential refunds totaling $18.6 million. The company remains cautious about future trade policies, which could impact gross margins, but is optimistic about its strategic positioning and market share, particularly with the Florsheim brand.

Looking ahead, Weyco Group anticipates continued focus on its e-commerce platform and product diversification to adapt to changing consumer preferences. The company plans to invest in capital expenditures ranging from $2 million to $3 million for the full year 2026, while also maintaining a commitment to shareholder returns through dividends and stock repurchases.