Pickerington, OH—Despite declines in profit and sales for its 2013 fiscal year, R.G. Barry Corporation today reported a “solid performance” for the year as it eliminated less productive businesses and expanded accessories classifications.
For the year ended June 29, the parent to Dearfoams, Baggallini and Foot Petals posted net income of $13.3 million, or $1.15 a share, compared with net income of $14.5 million, or $1.27 a share, a year ago.
Net sales for the year were $147 million compared with $156 million in fiscal 2012. The results included a $15 million decline in net footwear sales, which was anticipated due to the elimination of lower-margin and licensed business. That decline was offset in part, however, by a more than $6 million increase in higher-margin net sales in its accessories division.
Additional Acquisitions Likely
R.G. Barry’s fourth quarter results were net earnings of $281,000, or 2 cents a share, versus $474,000, or 4 cents a share, a year ago. Net sales were $25.5 million, up from $25 million a year ago.
“Our actions last year in eliminating less-productive businesses reflected our realignment of the Footwear segment for future growth and enhanced profitability,” said Jose Ibarra, senior vice president finance/chief financial officer. “Despite facing the formidable combination of retail and economic headwinds and our strategic decision to eliminate lower-margin and licensed footwear products in fiscal 2013, we generated an operating profit in excess of 14% as a percentage of net sales, making us one of the best performers in our sector.”
The company said gross profit as a percent of net sales was 43.5% compared to 43.1% in the prior year, “primarily reflecting the net benefit of the discontinuation of lower-margin and licensed footwear products on mix.”
“Looking to fiscal 2014, we expect to resume our pattern of increasing year-over-year revenue,” said Greg Tunney, president/ceo. “In the non-promotional, full-price Accessories businesses we will target a growth rate in the mid-teens. The objective of our Footwear segment will be to hit a year-over-year growth target in low single digits, although at a higher level of profitability than in fiscal 2013. We also plan to increase investment spending in support of our current businesses to a level that is more in line with our long-term growth strategies and profitability profile.”
Tunney said the company remains committed to expansion through acquisitions including “prospects in select international markets and additional business categories that we believe will fit well with our model and filter.”
“We remain very confident that our next growth milestone of becoming a $200-to-$250 million company in 3-to-5 years can and will be achieved,” Tunney added.