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Note 13 - Segment Information
 3 Months Ended
Mar. 31, 2025
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

13. SEGMENT INFORMATION

 

Reportable Segments - We have identified three reportable segments: Wholesale, Retail and Contract Manufacturing.

 

Wholesale. In our Wholesale segment, our products are offered in over 10,000 retail locations representing a wide range of distribution channels in the U.S., the U.K. and other international markets, mainly in Europe. These distribution channels vary by product line and target market and include sporting goods stores, outdoor retailers, independent shoe retailers, hardware stores, catalogs, mass merchants, uniform stores, farm store chains, specialty safety stores, specialty retailers and online retailers.

 

Retail. In our Retail segment, we market directly to consumers through our Lehigh business-to-business including direct sales and through our CustomFit websites, consumer e-Commerce websites, third-party marketplaces, and our Rocky Outdoor Gear Store. Through our outdoor gear store, we generally sell first quality or discontinued products in addition to a limited amount of factory damaged goods, which typically carry lower gross margins.

 

Contract Manufacturing. In our Contract Manufacturing segment, we include sales to the U.S. Military, private label sales and any sales to customers in which we are contracted to manufacture or source a specific footwear product for a customer.

 

Net sales to foreign countries represented approximately 2.0% and 2.1% of net sales for the three months ended March 31, 2025 and 2024, respectively. 

 

Our Chief Operating Decision Maker ("CODM") is our Chief Executive Officer (CEO), who evaluates operating results and performance based on net sales and gross margin. Our CODM also uses results of net sales and gross margin to evaluate segment performance and allocate resources as the primary metrics for overall segment evaluation. Operating expenses such as warehousing, distribution, marketing and other key activities supporting our operations are integrated to maximize efficiency and productivity; therefore, we do not include these expenses within our segment results, but instead review them at the consolidated level.

 

The following is a summary of segment results for the Wholesale, Retail and Contract Manufacturing segments for the  three months ended March 31, 2025 and 2024.
 
  

Three Months Ended

 
  

March 31,

 

($ in thousands)

 

2025

  

2024

 

NET SALES:

        

Wholesale

 $74,784  $79,791 

Retail

  36,641   30,408 

Contract Manufacturing

  2,648   2,707 

Total Net Sales

 $114,073  $112,906 
         

COST OF GOODS SOLD:

        

Wholesale

 $44,674  $50,760 

Retail

  19,896   15,606 

Contract Manufacturing

  2,495   2,391 

Total Cost of Goods Sold

 $67,065  $68,757 
         

GROSS MARGIN:

        

Wholesale

 $30,110  $29,031 

Retail

  16,745   14,802 

Contract Manufacturing

  153   316 

Total Gross Margin

 $47,008  $44,149 

 

Segment asset information is not prepared or used to assess segment performance.