McRae Industries, Inc. Reports Earnings For The Third Quarter & First Nine Months Of Fiscal 2019.

MOUNT GILEAD, N.C: McRae Industries, Inc. (Pink Sheets: MCRAA and MCRAB) reported consolidated net revenues for the third quarter of fiscal 2019 ending on April 27, 2019 of $18,606,000 as compared to $16,170,000 for the third quarter of fiscal 2018. Net earnings for the third quarter of fiscal 2019 amounted to $386,000, or $0.16 per diluted Class A common share as compared to $78,000, or $0.03 per diluted Class A common share, for the third quarter of fiscal 2018.

Consolidated net revenues for the first nine months of fiscal 2019 totaled $59,945,000 as compared to $59,041,000 for the first nine months of fiscal 2018. Net earnings for the first nine months of fiscal 2019 amounted to $1,310,000, or $0.55 per diluted Class A common share, as compared to net earnings of $2,051,000, or $0.85 per diluted Class A common share, for the first nine months of fiscal 2018.

THIRD QUARTER FISCAL 2019 COMPARED TO THIRD QUARTER FISCAL 2018

Consolidated net revenues totaled $18.6 million for the third quarter of fiscal 2019 as compared to $16.2 million for the third quarter of fiscal 2018. Sales related to our western/lifestyle boot products were $9.6 million for the third quarter of fiscal 2019 as compared to $10.1 million for the third quarter of fiscal 2018. This was primarily driven by a decline in our premium western boots sales. Revenues from our work boot products increased approximately 50%, from $5.9 million for the third quarter of fiscal 2018 to $8.8 million for the third quarter of fiscal 2019. This was primarily the result of increased military boot sales.

Consolidated gross profit for the third quarter of fiscal 2019 amounted to approximately $4.2 million as compared to $4.0 million for the third quarter of fiscal 2018. However, gross profit as a percentage of net revenues was down from 24.6% for the third quarter of fiscal 2018 to 22.5% for the third quarter of fiscal 2019. This drop was driven by a change in the sales mix of our western/lifestyle products, as well as an increase in freight cost. Additionally, margins were slightly impacted by management's decision not to renew our John Deere licensing agreement that expires in May 2019. Management plans to continue closing out our John Deere products over the next year.

Consolidated selling, general and administrative ("SG&A") expenses have slightly decreased from $3.9 million for the third quarter of fiscal 2018 to $3.8 million for the third quarter of fiscal 2019.

As a result of the above...