What changed in this filing

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Item 1A. Risk Factors

2025-03-17 compared with 2024-03-15 · 48 added, 29 removed, 192 unchanged (29% of the section changed)

10 unchanged sentences

New products that we introduce may not be successful with consumers or one or more of our brands may fall out of favor with consumers.

If we are unable to anticipate, identify or react appropriately to changes in consumer preferences, we may not grow as fast as we plan to grow or our sales may decline, and our brand image and operating performance may suffer.

Furthermore, achieving market acceptance for new products will likely require us to exert substantial product development and marketing efforts, which could result in a material increase in our operating expenses, and there can be no assurance that we will have the resources necessary to undertake such efforts.

Material increases in our operating expenses could adversely impact our results of operations and cash flows.

If we are unable to anticipate, identify or react appropriately to changes in consumer preferences, we may not grow as fast as we plan to grow.

This could cause our sales to decline, brand image to suffer and operating performance to deteriorate.

Furthermore, achieving market acceptance for new products will likely require us to exert substantial product development and marketing efforts, which could result in a material increase in our expenses, and there can be no assurance that we will have the resources necessary to undertake such efforts.

Material increases in our expenses could adversely impact our results of operations and cash flows.

We may also encounter difficulties in producing new products that we did not anticipate during the development stage.

2 unchanged sentences

Failure to gain market acceptance for new products that we introduce could impede our growth, reduce our profits, adversely affect the image of our brands, erode our competitive position and result in long term harm to our business.

A majority of our products are produced outside the U.S.

A majority of our products are produced outside the continental U.S.

where we are subject to the risks of international commerc e and other international conditions .

A majority of our products are produced in China, the D ominican Republic, and Vietnam.

The majority of our products are produced in China, the Dominican Republic, Puerto Rico, Vietnam, India, and Mexico.

Therefore, our business is subject to certain risks of doing business offshore including:

the imposition of additional U.S.

legislation and regulations relating to imports, including quotas, duties, taxes or other charges or restrictions;

legislation and regulations relating to imports, including quotas, duties, tariffs, taxes or other charges or restrictions, including recent tariffs on goods from China;

foreign governmental regulation and taxation, including tariffs, import and export controls and other non-tariff barriers;

9 unchanged sentences

If any of these factors were to render the conduct of business in these countries undesirable or impracticable, we would have to manufacture or source our products elsewhere.

There can be no assurance that additional sources or products would be available to us or, if available, that these sources could be relied on to provide product at terms favorable to us.

There can be no assurance that additional sources or products would be available to us or, if available, that these sources could be relied on to provide product at terms favorable to us or that is of the same quality.

The occurrence of any of these developments could have a material adverse effect on our business, financial condition, results of operations and cash flows.

3 unchanged sentences

The failure to adequately anticipate or respond to these changes could have a material adverse effect on our business, financial condition, results of operations and cash flows.

We depend on a limited number of suppliers for key production materials, and any disruption in the supply of such materials could interrupt product manufacturing and increase product costs.

We depend on a limited number of suppliers for key production materials, and disruptions in the supply of such materials could interrupt product manufacturing and increase product costs.

We purchase raw materials from a number of domestic and foreign sources.

We do not have any long-term supply contracts for the purchase of our raw materials, except for limited blanket orders on leather.

The principal raw materials used in the production of our footwear, in terms of dollar value, are leather, Gore-Tex waterproof breathable fabric, Cordura nylon fabric and soling materials.

We do not have long-term supply contracts for the purchase of our raw materials.

The principal raw materials used in the production of our footwear, in terms of dollar value, are leather, Cordura nylon fabric and soling materials.

Availability or change in the prices of our raw materials could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Our ability to import products in a timely and cost-effective manner may also be affected by conditions at ports or issues that otherwise affect transportation and warehousing providers, such as fluctuations in freight costs, port and shipping capacity, labor disputes or severe weather due to climate change.

These issues have in the past and may in the future delay importation of products or require us to locate alternative ports or warehousing providers to avoid disruption to customers.

2 unchanged sentences

The emergence or persistence of geopolitical instability creates risks for disruptions in the global economy which may negatively impact our business, financial condition, and results of operations.

Factors such as shipping disruptions in the Red Sea, uncertainties related to the political environment in China, and ongoing conflicts such as the war between Russia and Ukraine have adversely affected the global economy and contributed to geopolitical instability.

Factors such as new tariffs proposed by the U.S.

in various international markets, including China, shipping disruptions in the Red Sea, uncertainties related to the political environment in China, and ongoing conflicts such as the war between Russia and Ukraine have adversely affected the global economy and contributed to geopolitical instability.

While we have managed to navigate impacts from these conflicts thus far, the ongoing instability resulting from these disruptions or other future disruptions could potentially harm our business, financial condition, results of operations, supply chain, intangible assets, partners, customers, or employees, should tensions escalate.

31 unchanged sentences

Any failure by us to comply with the restrictive covenants could result in an event of default under those borrowing arrangements, in which case the lenders could elect to declare all amounts outstanding thereunder to be due and payable, which could have a material adverse effect on our financial condition.

Our credit facilities contain restrictive covenants which requires us to maintain a maximum total average ratio and a minimum fixed charge coverage ratio.

Our credit facilities contain restrictive covenants which requires us to maintain a minimum fixed charge coverage ratio.

Interest rate increases could adversely affect our financial results.

5 unchanged sentences

Competition could materially adversely affect our business, financial condition, results of operations and cash flows.

Our financial success is influenced by the success of our customers, and the loss of a key customer could have a material adverse effect on our financial condition and results of operations.

Our financial success is influenced by the success of our wholesale customers, and the loss of such a key customer could have a material adverse effect on our financial condition and results of operations.

Much of our financial success is directly related to the ability of our retailer and distributor partners to successfully market and sell our brands directly to consumers.

18 unchanged sentences

We rely on our distribution centers located in Ohio and Nevada and our manufacturing facilities in the Dominican Republic, Puerto Rico, and China.

Any natural disaster or other serious disruption at any of these facilities due to fire, tornado, flood, terrorist attack or any other cause could damage our ability to manufacture our products, a portion of our inventory, or impair our ability to use our distribution center as a docking location for merchandise.

Any natural disaster or other serious disruption at any of these facilities due to fire, tornado, hurricane, flood, other natural disaster, pandemic, public health crisis, labor dispute, terrorist attack or any other cause could damage our ability to manufacture our products, a portion of our inventory, or impair our ability to use our distribution center as a docking location for merchandise.

Any of these occurrences could impair our ability to adequately supply our retailers and consumers and harm our operating results.

4 unchanged sentences

If our patents are found to be invalid, however, to the extent they have served, or would in the future serve, as a barrier to entry to our competitors, such invalidity could have a material adverse effect on our business, financial condition, results of operations and cash flows.

registrations for many our trademarks, trade names and designs, including such marks as Rocky, Muck, Georgia Boot, Durango, XTRATUF, Lehigh and Ranger.

registrations for many our trademarks, trade names and designs, including such marks as Muck, Rocky, Georgia Boot, Durango, Lehigh, XTRATUF and Ranger.

Additional trademarks, trade names and designs are the subject of pending federal applications for registration.

4 unchanged sentences

An impairment of intangibles, including goodwill, could have an adverse impact to the Company’s results of operations.

The carrying value of intangibles represents the fair value of trade names and other acquired intangibles as of the acquisition date.

Acquired intangibles expected to contribute indefinitely to the Company’s cash flows are not amortized but must be evaluated by the Company at least annually for impairment.

The carrying value of intangibles represents the fair value of trade names and other intangibles as of the acquisition date.

Intangibles expected to contribute indefinitely to the Company’s cash flows are not amortized but must be evaluated by the Company at least annually for impairment.

If the carrying amounts of one or more of these assets are not recoverable based upon discounted cash flow and market-approach analyses, the carrying amounts of such assets are impaired by the estimated difference between the carrying value and estimated fair value.

8 unchanged sentences

Although we have paid dividends to our shareholders, we have no obligation to continue doing so and may change our dividend policy at any time without notice to our shareholders.

Our ABL Facility and Term Facility (as such terms defined in Note 10 - Long-Term Debt of our Consolidated Financial Statements) also contain restrictions on the amount of dividend payments.

Holders of our common stock are only entitled to receive such cash dividends as our Board of Directors may declare out of funds legally available for such payments.

10 unchanged sentences

A downturn in regional economies where we sell products also reduces sales.

The continued shift in the marketplace from traditional independent retailers to large mass merchandisers may result in decreased margins.

A continued shift in the marketplace from traditional independent retailers to large mass merchandisers has increased the pressure on many footwear manufacturers to sell products to these mass merchandisers at less favorable margins.

Because of competition from large discount mass merchandisers, a number of our small retailing customers have gone out of business, and in the future more of these customers may go out of business, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

If we do not effectively respond to the shift of consumer shopping moving to online retailers , including third-party marketplaces, it may negatively impact our business.

The retail industry is rapidly changing and we must ensure we are evolving both our own online e-commerce websites and third-party marketplaces.

The continued shift in the third-party marketplace from traditional independent retailers to large mass merchandisers may result in decreased margins.

A continued shift in the third-party marketplace from traditional independent retailers to large mass merchandisers has increased the pressure on many footwear manufacturers to sell products to these mass merchandisers at less favorable margins.

Due to the competition from large discount mass merchandisers, a number of our small retailing customers have gone out of business, and in the future more of these customers may go out of business, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

The shift in consumer shopping to online retailers and our increased online sales pose various risks which may negatively impact our business.

The retail industry and consumer preferences are rapidly changing and we must ensure our own online e-Commerce websites and third-party marketplaces can accommodate the consumer's growing desire to shop online.

We must also provide digital assistance to our wholesale customers to support their e-Commerce websites.

Failure to timely identify and effectively respond to the online trends of the retail industry could negatively impact our product reach and market share.

We are making technology investments in our websites and mobile applications.

If we are unable to improve or develop relevant technology in a timely manner, our ability to compete and our results of operations could be adversely affected.

Our e-Commerce and third-party marketplace platforms pose numerous risks that could have an impact on our results of operations including:

unanticipated operating problems such as computer viruses, electronic data theft and other disruptions;

reliance on third-party software and service providers;

continual investment in technology and cyber security;

our ability to adapt and change to the ever-changing consumer buying habits through customer-facing technology, including mobile technology solutions that function, and provide a convenient and consistent experience for consumers;

exposure to potential liability for online content;

increased competition among other e-Commerce vendors.

General Risk Factors

3 unchanged sentences

and other countries.

We source products from manufacturers located outside of the U.S., primarily in China and Vietnam.

We source products from manufacturers located outside of the U.S., primarily in China, Vietnam, the Dominican Republic, India, and Mexico.

Major developments in tax policy or trade relations, such as the disallowance of tax deductions for imported products or the imposition of unilateral tariffs on imported products, could have a material adverse effect on our business, results of operations and liquidity.

3 unchanged sentences

Changes in the amounts and frequency of share repurchases or dividends also could adversely affect the value of our common stock.

Disruption of our information technology systems could adversely affect our business

Our information technology systems are critical to our business operations.

Disruption of our information technology systems and e-Commerce platforms could adversely affect our business

Our information technology systems and-e-Commerce platforms are critical to our business operations.

Any interruption, unauthorized access, impairment or loss of data integrity or malfunction of these systems could severely impact our business, including delays in product fulfillment and reduced efficiency in operations.

2 unchanged sentences

System redundancy may be ineffective or inadequate, and our disaster recovery planning may not be sufficient for all eventualities.

Such failures or disruptions could prevent access to our online services and preclude retail transactions.

Such failures or disruptions could prevent access to our online services and preclude retail transactions resulting in loss of sales.

System failures and disruptions could also impede the manufacturing and shipping of products, transactions processing and financial reporting.

2 unchanged sentences

Remote work could also introduce operational risk such as, but not limited to, cyber security risks.

We are implementing a new enterprise resource planning system, and challenges with the implementation of the system may have an adverse effect on our business, financial condition results of operations

We are in the process of completing a multi-year implementation of a complex new enterprise resource planning system (“ERP”).

The ERP implementation has required the integration of the new ERP with multiple information systems and business processes and has been designed to continue to accurately maintain our books and records and provide timely information to our management team important to maximizing the operating efficiency of our business.

Conversion from our old systems to the new ERP may cause inefficiencies until the ERP is stabilized and mature.

The implementation of our new ERP will mandate subtle changes to our procedures and controls over financial reporting.

If we are unable to adequately implement and maintain procedures and controls relating to our new ERP, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired and impact our assessment of the effectiveness of our internal controls over financial reporting.

A cyber-security breach could have a material adverse effect on our business and reputation .

27 unchanged sentences

We maintain an ongoing assessment and monitoring processes to gauge the impact that future climate change disclosures, regulations, or industry standards, and international treaties may have on our business and results of operations.

Our products are subject to increasingly stringent and complex domestic and foreign product labeling, performance, environmental and safety standards, laws and other regulations, including those pertaining to perfluoroalkyl and polyfluoroalkyl substances (PFAS) and other environmental impacts.

These requirements could result in greater expense associated with compliance efforts, and failure to comply with these regulations could result in a delay, non-delivery, recall, or destruction of inventory shipments during key seasons, a loss of advance orders from wholesale customers or in other financial penalties.

Significant or continuing noncompliance with these standards and laws could disrupt our business and harm our reputation.

Our products are generally used in outdoor activities, sometimes in severe conditions.

Product recalls or product liability claims resulting from the failure, or alleged failure, of our products could have a material adverse effect on the reputation of our brands and result in additional expenses.

We are subject to periodic litigation and other regulatory proceedings, which could result in the unexpected expenditure of time and resources.

8 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors