UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C. 20549

FORM 10-Q

(Mark One)

⌧	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

◻	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________________ to _____________________________

Commission File Number: 000-09068

WEYCO GROUP, INC.

(Exact name of registrant as specified in its charter)

WISCONSIN		39-0702200
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

333 W. Estabrook Boulevard

P. O. Box 1188

Milwaukee, Wisconsin 53201

(Address of principal executive offices)

(Zip Code)

(414) 908-1600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock - $1.00 par value per share		WEYS		The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐

Accelerated Filer ☒

Non-Accelerated Filer ☐

Smaller Reporting Company ☒

Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ⌧

As of April 22, 2022, there were 9,635,433 shares of common stock outstanding.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

The following consolidated condensed balance sheet as of December 31, 2021, which has been derived from audited financial statements, and the unaudited interim consolidated condensed financial statements have been prepared by Weyco Group, Inc. (“we,” “our,” “us,” and the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made are adequate to make the information not misleading. Please read these consolidated condensed financial statements in conjunction with the financial statements and notes thereto included in our latest annual report on Form 10-K.

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)


	March 31,		December 31,
	2022		2021

	(Dollars in thousands)
ASSETS:
Cash and cash equivalents	$	24,150	$	19,711
Investments, at fair value		106		8,122
Marketable securities, at amortized cost		719		219
Accounts receivable, net		51,871		53,287
Income tax receivable		—		495
Inventories		62,056		71,026
Prepaid expenses and other current assets		4,124		4,317
Total current assets		143,026		157,177

Marketable securities, at amortized cost		9,023		9,996
Deferred income tax benefits		1,098		1,063
Property, plant and equipment, net		28,986		29,202
Operating lease right-of-use assets		8,790		9,543
Goodwill		12,317		12,317
Trademarks		34,768		34,768
Other assets		23,778		23,601
Total assets	$	261,786	$	277,667

LIABILITIES AND EQUITY:
Accounts payable	$	6,251	$	19,234
Operating lease liabilities		3,451		3,593
Accrued liabilities		7,768		11,681
Accrued income tax payable		952		—
Total current liabilities		18,422		34,508

Deferred income tax liabilities		5,003		5,026
Long-term pension liability		27,480		27,776
Operating lease liabilities		6,887		7,520
Other long-term liabilities		1,626		1,442
Total liabilities		59,418		76,272

Common stock		9,634		9,709
Capital in excess of par value		69,076		68,718
Reinvested earnings		147,777		147,762
Accumulated other comprehensive loss		(24,119)		(24,794)
Total equity		202,368		201,395
Total liabilities and equity	$	261,786	$	277,667

The accompanying notes to consolidated condensed financial statements (unaudited) are an integral part of these financial statements.

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME (UNAUDITED)


	Three Months Ended March 31,
	2022		2021

	(In thousands, except per share amounts)

Net sales	$	81,360	$	46,900
Cost of sales		52,232		27,595
Gross earnings		29,128		19,305

Selling and administrative expenses		23,697		17,671
Earnings from operations		5,431		1,634

Interest income		91		131
Interest expense		(1)		(7)
Other (expense) income, net		(6)		138

Earnings before provision for income taxes		5,515		1,896

Provision for income taxes		1,462		571

Net earnings		4,053		1,325

Weighted average shares outstanding
Basic		9,596		9,680
Diluted		9,647		9,686

Earnings per share
Basic	$	0.42	$	0.14
Diluted	$	0.42	$	0.14

Cash dividends declared (per share)	$	0.24	$	0.24

Comprehensive income	$	4,728	$	1,365

The accompanying notes to consolidated condensed financial statements (unaudited) are an integral part of these financial statements.

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)


	Three Months Ended March 31,
	2022		2021

	(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	4,053	$	1,325
Adjustments to reconcile net earnings to net cash provided by operating activities -
Depreciation		604		623
Amortization		71		82
Bad debt expense		15		17
Deferred income taxes		(111)		39
Net foreign currency transaction losses (gains)		32		(115)
Share-based compensation expense		350		545
Increase in cash surrender value of life insurance		(150)		(150)
Changes in operating assets and liabilities -
Accounts receivable		1,395		2,273
Inventories		8,980		11,700
Prepaid expenses and other assets		89		572
Accounts payable		(12,966)		(1,839)
Accrued liabilities and other		(3,578)		(1,425)
Accrued income taxes		1,447		522
Net cash provided by operating activities		231		14,169

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of marketable securities		475		1,720
Purchases of investment securities		—		(20,011)
Proceeds from sale of investment securities		8,050		—
Purchases of property, plant and equipment		(352)		(73)
Net cash provided by (used for) investing activities

SEC Form 10-Q filed by Weyco Group Inc.