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Weyco Reports Q3 Sales, Earnings
Foreign Sales See A Substantial Boost

MILWAUKEE (Nov. 4, 2009)—Weyco Group, Inc., which designs and markets better men's footwear under the Florsheim, Nunn Bush and Stacy Adams brands, today announced financial results for the quarter ended September 30, 2009.

Net sales for the third quarter were $57.9 million, an increase of 1 percent from 2008 sales of $57.2 million. Net earnings for the quarter were $3.4 million, down from $4.3 million in 2008. Diluted earnings per share were $.29 per share in 2009 as compared with $.37 per share in the third quarter of 2008.

"Our results continue to be impacted by the generally weak retail economy," stated Tom Florsheim, Jr., chairman and CEO of Weyco Group. "Our company has strong brands and a lean cost structure and we believe that we will be well-positioned for success when the overall economy improves."

On January 23, 2009, the company acquired a majority interest in a new subsidiary that subsequently purchased the Florsheim wholesale and retail businesses in Australia, Asia Pacific and South Africa (collectively "Florsheim Australia"). The financial results of Florsheim Australia are included in the company's consolidated financial statements from the date of acquisition. The company previously had license agreements with these entities; consequently, no licensing revenues were recorded for these entities after January 23, 2009.

Net sales in the wholesale division, which includes North American wholesale sales and licensing revenues, were $42.4 million for the third quarter of 2009, compared with $48.8 million in 2008. Wholesale product sales were $41.8 million in the third quarter of 2009, down from $47.8 million in 2008. In the wholesale division, sales of the company's Stacy Adams, Nunn Bush and Florsheim brands were down 10, 7 and 21 percent, respectively. Licensing revenues were $616,000 in 2009 and $991,000 in 2008. The decrease in licensing revenues resulted from the company's acquisition of its licensees in Australia, Asia Pacific, and South Africa, described above, and also was due to a general trend of lower sales of the company's licensed products in the current challenging retail environment.

Net sales in the retail division, which includes sales from the company's North American retail stores and domestic Internet business, were $5.1 million in the third quarter of 2009, compared with $6.2 million in 2008. The company has two fewer stores this year compared with 2008. Same store sales were down 9.5 percent.

Foreign sales, which include the wholesale and retail sales of Florsheim Europe and Florsheim Australia, were $10.5 million in the third quarter of 2009, compared to $2.2 million in 2008. In 2009, Florsheim Europe's net sales were $2.3 million, with the remaining $8.2 million representing sales of Florsheim Australia.

Operating earnings for the third quarter were $4.6 million, down from $6.3 million in 2008. As a percent of sales, operating earnings fell from 11.1 percent in 2008 to 7.9 percent in 2009, due primarily to lower sales volumes in 2009.

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