ROCKY BRANDS, INC. Segments Disclosure

16. 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 thousands of retail locations representing a wide range of distribution channels in the U.S., 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, 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 2.3% of net sales in 2025 and 3.2% of net sales in 2024.

 

The net book value of fixed assets located outside of the U.S. totaled $11.1 million at December 31, 2025, of which approximately $3.7 million resides in the Dominican Republic and approximately $7.4 million resides in China.

 

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 years ended December 31:

 

		Year Ended
		December 31,
($ in thousands)		2025				2024
NET SALES:
Wholesale		$	316,561			$	313,340
Retail			152,889				126,868
Contract Manufacturing			12,526				13,564
Total Net Sales		$	481,976			$	453,772
COST OF GOODS SOLD:
Wholesale		$	192,932			$	196,095
Retail			79,835				66,715
Contract Manufacturing			11,919				11,952
Total Cost of Goods Sold		$	284,686			$	274,762
GROSS MARGIN:
Wholesale		$	123,629			$	117,245
Retail			73,054				60,153
Contract Manufacturing			607				1,612
Total Gross Margin		$	197,290			$	179,010

 

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