Pickerington, OH–R.G. Barry, makers of Dearfoams and other slippers, posted today a small third quarter loss due to higher costs.
For the quarter ended April 2, the company posted a loss $42,000, or no cents a share, on sales of $20.1 million, compared with net income of $539,000, or 5 cents per share, on sales of $22.2 million in the third quarter a year ago.
“Two major factors negatively impacted our third-quarter performance,” said Greg Tunney, president and ceo, said. “A new warehouse club program launched during the third quarter last year was not repeated at the same level this year, and we experienced softness in the replenishment slipper business with our largest footwear customer.”
Acquisitions to Factor into Fourth Quarter Results
The loss also includes about $900,000 in costs related the third-quarter acquisitions of shoe insoles maker Foot Petals LLC and Baggallini, a Portland-based handbag and accessories maker. Both acquisitions are part of R.G.Barry’s plan to expand beyond its dominate slippers category.
“When our new Baggallini business is included in the fourth quarter results this year, it will begin to validate our new operating model, which we expect to perform at rates well above those traditionally generated by our footwear business alone,” Tunney added.
These acquisitions and its “decision to exit underperforming footwear businesses” will be good for the company going forward, Tunney said. “We will enter our new year on July 3 as a more balanced, faster growing and more profitable multidimensional provider of footwear and accessories.”