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, 2021

◻	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 23, 2021, there were 9,735,467 shares of common stock outstanding.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

The following consolidated condensed balance sheet as of December 31, 2020, which has been derived from audited financial statements, and the unaudited interim consolidated condensed financial statements have been prepared by Weyco Group, Inc. (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 the Company believes that the disclosures made are adequate to make the information not misleading. It is suggested that these consolidated condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company’s latest annual report on Form 10-K.

WEYCO GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)


	March 31,		December 31,
	2021		2020

	(Dollars in thousands)
ASSETS:
Cash and cash equivalents	$	24,860	$	32,476
Investments, at fair value		20,011		—
Marketable securities, at amortized cost		1,483		2,215
Accounts receivable, net		32,317		34,631
Income tax receivable		853		1,374
Inventories		47,340		59,025
Prepaid expenses and other current assets		3,951		4,610
Total current assets		130,815		134,331

Marketable securities, at amortized cost		11,804		12,800
Deferred income tax benefits		1,218		1,235
Property, plant and equipment, net		30,196		30,759
Operating lease right-of-use assets		10,538		9,613
Goodwill		11,112		11,112
Trademarks		32,868		32,868
Other assets		24,164		24,001
Total assets	$	252,715	$	256,719

LIABILITIES AND EQUITY:
Accounts payable	$	6,605	$	8,444
Operating lease liabilities		4,048		4,245
Accrued liabilities		10,640		11,656
Total current liabilities		21,293		24,345

Deferred income tax liabilities		3,001		2,914
Long-term pension liability		33,191		33,534
Operating lease liabilities		8,565		7,734
Other long-term liabilities		245		267
Total liabilities		66,295		68,794

Common stock		9,735		9,797
Capital in excess of par value		67,723		67,178
Reinvested earnings		136,927		138,955
Accumulated other comprehensive loss		(27,965)		(28,005)
Total equity		186,420		187,925
Total liabilities and equity	$	252,715	$	256,719

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 EndedMarch 31,
	2021		2020

	(In thousands, except per share amounts)

Net sales	$	46,900	$	63,584
Cost of sales		27,595		40,407
Gross earnings		19,305		23,177

Selling and administrative expenses		17,671		21,836
Earnings from operations		1,634		1,341

Interest income		131		149
Interest expense		(7)		(51)
Other income, net		138		407

Earnings before provision for income taxes		1,896		1,846

Provision for income taxes		571		684

Net earnings		1,325		1,162

Weighted average shares outstanding
Basic		9,680		9,781
Diluted		9,686		9,786

Earnings per share
Basic	$	0.14	$	0.12
Diluted	$	0.14	$	0.12

Cash dividends declared (per share)	$	0.24	$	0.24

Comprehensive income (loss)	$	1,365	$	(1,258)

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,
	2021		2020

	(Dollars in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings	$	1,325	$	1,162
Adjustments to reconcile net earnings to net cash provided by operating activities -
Depreciation		623		733
Amortization		82		71
Bad debt expense		17		145
Deferred income taxes		39		360
Net foreign currency transaction gains		(115)		(356)
Share-based compensation expense		545		351
Pension expense		—		111
Increase in cash surrender value of life insurance		(150)		(135)
Changes in operating assets and liabilities -
Accounts receivable		2,273		4,878
Inventories		11,700		18,704
Prepaid expenses and other assets		572		2,176
Accounts payable		(1,839)		(8,477)
Accrued liabilities and other		(1,425)		(5,410)
Accrued income taxes		522		680
Net cash provided by operating activities		14,169		14,993

CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from maturities of marketable securities		1,720		4,510
Purchases of investment securities		(20,011)		—
Purchases of property, plant and equipment		(73)		(1,797)
Net cash (used for) provided by investing activities		(18,364)		2,713

CASH FLOWS FROM FINANCING ACTIVITIES:
Cash dividends paid		(2,319)		(4,694)
Shares purchased and retired		(1,079)		(1,304)
Proceeds from bank borrowings		—		11,883
Repayments of bank borrowings		—		(18,932)
Net cash used for financing activities		(3,398)		(13,047)

Effect of exchange rate changes on cash and cash equivalents		(23)		(277)

Net (decrease) increase in cash and cash equivalents	$	(7,616)	$	4,382

CASH AND CASH EQUIVALENTS at beginning of period		32,476		9,799

CASH AND CASH EQUIVALENTS at end of period	$	24,860	$	14,181

SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid, net of refunds	$	24	$	235
Interest paid	$

SEC Form 10-Q filed by Weyco Group, Inc.