BUSINESS OVERVIEW
We are a leading designer, manufacturer, and marketer of premium quality footwear and apparel marketed under a portfolio of well recognized brand names including Muck, XTRATUF, Rocky, Durango, Georgia Boot, Lehigh, Ranger, and the licensed brand Michelin. Our portfolio of brands is organized into three reportable segments in which our product is distributed: Wholesale, Retail, and Contract Manufacturing. The reportable segments are targeted around six distinct product lines: work, outdoor, western, duty, commercial military, and military. We frequently experience significant seasonal fluctuations in our business as many of our footwear products and product lines are used by consumers in adverse weather conditions. Accordingly, average inventory levels have been highest during the second and third quarters of each year and sales have been highest in the last two quarters of the year.
Our business is subject to a highly evolving and everchanging macroeconomic environment, including changes in tariffs, taxes and industry changes. We continue to monitor changes in policy impacting global trade, including tariffs, which have been dynamic, unpredictable, and subject to ongoing modification. Beginning in early 2025, pursuant to the International Emergency Economic Powers Act ("IEEPA"), significant additional tariffs were imposed on products imported from various countries, including those countries where we primarily source our products. In February 2026, the U.S. Supreme Court invalidated certain tariffs imposed under the IEEPA and in March 2026, the U.S. Court of International Trade ordered the U.S. Customs and Border Protection Agency to suspend collection of the invalidated tariffs and to establish a process to refund certain IEEPA tariffs previously collected. As a result of this ruling, we are eligible to receive refunds of tariffs previously paid on qualifying imports, including interest. We have paid approximately $20.5 million in tariffs for products that were subject to the invalidated IEEPA tariffs. We applied the loss recovery model and determined the expected receipt of the refund of the previously paid IEEPA tariffs is probable. Accordingly, we recognized a benefit of $18.0 million as a reduction to cost of goods sold within the accompanying Unaudited Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2026. Additionally, $2.5 million has been recorded as a reduction of inventory within the accompanying Unaudited Condensed Consolidated Balance Sheet as of June 30, 2026, and will be recognized as a reduction to cost of goods sold as the inventory is sold. As of June 30, 2026, we have received $3.7 million in refunds and recorded $16.8 million of outstanding IEEPA tariff receivables, which is included in "other receivables" within the accompanying Unaudited Condensed Consolidated Balance Sheet. Subsequent to June 30, 2026, we have received an additional $8.2 million of the IEEPA tariff receivable.
There remains substantial uncertainty regarding the potential changes or pauses to existing and newly announced tariffs, tariff levels, and whether additional tariffs or other reciprocal actions may be imposed, modified, or suspended. We have implemented, and plan to continue to implement, as needed, various mitigation strategies including adjusting the prices of our products, adjusting the countries from which we source our products and further leveraging our own manufacturing facilities in the Dominican Republic and Puerto Rico. Proposed or enacted tariffs and changes to U.S. trading policies may be reinstituted, paused, removed, or changed at any time and to the extent we are unable to successfully mitigate any negative resulting impacts, our business, financial condition, and results of operation could be materially and adversely affected.
During the second quarter of 2026, we experienced an increase in net sales over the second quarter of 2025. This increase was attributable to an increase in net sales across all three of our reportable segments, Retail, Wholesale, and Contact Manufacturing. The price increase implemented in the third quarter of 2025 allowed us to experience steady growth during the first half of 2026 over the first half of 2025. Our Retail segment continues to be our fastest growing reportable segment, with double digit growth in the first and second quarters of 2026 over the prior year periods, driven by growth across all of our Retail selling channels. The increase in net sales on our e-commerce websites and third-party marketplace platforms was driven by a continued focus on our digital marketing and expansion into new marketplaces. The increase in net sales in our Lehigh CustomFit business was attributed to expanding our customer base and product offerings. We saw an increase in gross margin as a percentage of sales in our Wholesale and Retail segments as a result of the recognition of actual and expected IEEPA tariff refunds in the second quarter of 2026, which reduced cost of goods sold.
Our operating expenses as a percentage of net sales for the three and six months ending June 30, 2026 increased due to an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy during the second quarter of 2026.
Interest expense declined for the three and six months ending June 30, 2026 compared to the same periods in 2025 due to continued debt repayments over the past twelve months, which have reduced the overall outstanding principal balances, as well as a decrease in interest rates.
The decrease in inventory as of June 30, 2026 compared to June 30, 2025 was primarily due to our efforts to optimize our inventory position by reducing our discontinued inventory levels throughout the year.
SECOND QUARTER 2026 FINANCIAL HIGHLIGHTS COMPARED TO SECOND QUARTER 2025
● Net sales increased 12.0% to $118.4 million
● Gross margin increased to 51.4% of net sales compared to 41.0% of net sales
● Inventories decreased 7.1% to $173.5 million
● Total debt decreased 7.6% to $122.4 million
FIRST HALF OF 2026 FINANCIAL HIGHLIGHTS COMPARED TO FIRST HALF OF 2025
● Net sales increased 10.5% to $242.8 million
● Gross margin increased to 43.8% of net sales compared to 41.1% of net sales
● Income from operations increased to $23.3 million compared to $15.9 million
● Net income increased to $15.1 million, or $1.99 per diluted share
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RESULTS OF OPERATIONS
The following tables set forth, for the periods indicated, information derived from our Unaudited Condensed Consolidated Financial Statements. The discussion that follows each table should be read in conjunction with our Unaudited Condensed Consolidated Financial Statements as well as our Annual Report on Form 10-K for the year ended December 31, 2025.
Three Months Ended Six Months Ended
June 30, June 30,
($ in thousands) 2026 2025 2026 2025
Net sales $ 118,368 $ 105,647 $ 242,769 $ 219,720
Cost of goods sold 57,564 62,366 136,531 129,431
Gross margin 60,804 43,281 106,238 90,289
Operating expenses 41,119 36,125 82,919 74,427
Income from operations $ 19,685 $ 7,156 $ 23,319 $ 15,862
Net sales increased to $118.4 million in the second quarter of 2026 compared to $105.6 million in the second quarter of 2025. The increase in net sales in the current year quarter compared to the prior year quarter was due to an increase in net sales across all of our reportable segments: Wholesale, Retail, and Contract Manufacturing.
Gross margin in the second quarter of 2026 was $60.8 million, or 51.4% of net sales, compared to $43.3 million, or 41.0% of net sales, in the second quarter of 2025. The increase in gross margin as a percentage of net sales was primarily due to the recognition of actual and expected IEEPA tariff refunds, which reduced cost of goods sold in the second quarter of 2026.
Operating expenses for the second quarter of 2026 were $41.1 million, or 34.7% of net sales, compared to $36.1 million, or 34.2% of net sales, for the second quarter of 2025. The increase in operating expenses as a percentage of net sales was due to an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy in the second quarter of 2026.
Income from operations for the second quarter of 2026 was $19.7 million, or 16.6% of net sales, compared to $7.2 million, or 6.8% of net sales, in the year-ago period. The increase in income from operations was primarily driven by the increase in gross margin for the three months ended June 30, 2026 compared to the year-ago period.
Net sales increased to $242.8 million in the six months ended June 30, 2026 compared to $219.7 million in the six months ended June 30, 2025. The increase in net sales in the current year quarter compared to the prior year quarter was due to an increase in net sales across all of our reportable segments: Wholesale, Retail, and Contract Manufacturing.
Gross margin in the
six months ended June 30, 2026
was $106.2 million, or 43.8% of net sales, compared to $90.3 million, or 41.1% of net sales, in the
six months ended June 30, 2025.
The increase in gross margin was primarily due to the recognition of actual and expected IEEPA tariff refunds, which lowered cost of goods sold in the second quarter of 2026.
Operating expenses for the
six months ended June 30, 2026 wer
e $82.9 million, or 34.2% of net sales, compared to $74.4 million, or 33.9% of net sales, for the
six months ended June 30, 2025. The increase in operating expenses as a percentage of net sales was due to an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy in the second quarter of 2026.
Income from operations for the
six months ended June 30, 2026 was
$23.3 million, or 9.6% of net sales, compared to $15.9 million, or 7.2% of net sales, in the year-ago period. The in
crease in income from operations was primarily driven by the increase in gross margin for the
six months ended June 30, 2026 compared to the year-ago period.
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Three Months Ended June 30, 2026 compared to Three Months Ended June 30, 2025
Three Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
NET SALES:
Wholesale $ 78,830 $ 73,092 $ 5,738 7.9 %
Retail 36,245 29,746 6,499 21.8
Contract Manufacturing 3,293 2,809 484 17.2
Total Net Sales $ 118,368 $ 105,647 $ 12,721 12.0 %
Wholesale segment net sales for the three months ended June 30, 2026 were $78.8 million compared to $73.1 million for the three months ended June 30, 2025. The increase in Wholesale segment net sales was due to increased demand across several key styles and brands coupled with price increases implemented in the third quarter of 2025. As part of a strategic initiative, we continued to build upon the lifestyle component of our outdoor category to broaden our distribution and consumer reach. Additionally, we offered select incentives to capture additional shelf space with key customers, and opportunistic selling of more discontinued styles in this year’s second quarter. The combination of these factors helped drive increased volume in the second quarter of 2026 compared to the prior year period.
Retail segment net sales for the three months ended June 30, 2026 were $36.2 million compared to $29.7 million for the three months ended June 30, 2025. The increase was attributed to increases in our owned e-commerce website net sales, our Lehigh CustomFit business, and third-party marketplace net sales. We upgraded our e-commerce platform during the third quarter of 2025 and have increased our investments in digital advertising, driving more traffic to our website and increasing our net sales in the second quarter of 2026 compared to the prior year period. We experienced an increase in our Lehigh CustomFit business as we continue to expand our customer base and increase product offerings. The increase in third-party marketplace platforms was attributed to increased presence within the marketplace space as well as price increases.
Contract Manufacturing net sales for the three months ended June 30, 2026 were $3.3 million compared to $2.8 million for the three months ended June 30, 2025. The increase in Contract Manufacturing net sales was due to increased sales to the U.S. Military.
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Three Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.)
GROSS MARGIN:
Wholesale Margin $'s $ 40,636 $ 29,478 $ 11,158
Margin % 51.5 % 40.3 % 11.2 %
Retail Margin $'s $ 19,861 $ 13,455 $ 6,406
Margin % 54.8 % 45.2 % 9.6 %
Contract Manufacturing Margin $'s $ 307 $ 348 $ (41 )
Margin % 9.3 % 12.4 % (3.1 )%
Total Margin $'s $ 60,804 $ 43,281 $ 17,523
Margin % 51.4 % 41.0 % 10.4 %
Wholesale segment gross margin for the three months ended June 30, 2026 was $40.6 million, or 51.5% of net sales, compared to $29.5 million, or 40.3% of net sales, for the three months ended June 30, 2025. The increase in Wholesale segment gross margin as a percentage of net sales in the second quarter of 2026 compared to the second quarter of 2025 was primarily due to the recognition of actual and expected IEEPA tariff refunds, which reduced cost of goods sold in the current quarter, partially offset by tariff-related costs and sourcing variances. The net impact of the aforementioned tariff refunds and tariff costs resulted in a reduction to Wholesale segment cost of goods sold of approximately $12.0 million in the second quarter of 2026. The increase in Wholesale segment gross margin resulting from the net tariff impact was partially offset by higher discontinued product sales as we continue to optimize our inventory position as well as additional promotions and discounts offered to several key customers in an effort to gain additional shelf space.
Retail segment gross margin for the three months ended June 30, 2026 was $19.9 million, or 54.8% of net sales, compared to $13.5 million, or 45.2% of net sales, for the three months ended June 30, 2025. The increase in Retail segment gross margin as a percentage of net sales was primarily due to the recognition of actual and expected IEEPA tariff refunds, which lowered cost of goods sold in the current quarter, partially offset by tariff-related costs and sourcing variances. The net impact of the aforementioned tariff refunds and tariff costs resulted in a reduction to Retail segment cost of goods sold of approximately $3.0 million in the second quarter of 2026. Additionally, the increase in Retail segment gross margins as a percentage of net sales was also attributable to price increases implemented in the third quarter of 2025 as well as a favorable shift in our branded sales mix, with our rubber boot brands delivering stronger growth relative to the rest of the brands in our portfolio. Our rubber boots product typically yield higher gross margins than other products within our brand portfolio.
Contract Manufacturing segment gross margin for the three months ended June 30, 2026 was $0.3 million, or 9.3% of net sales, compared to $0.3 million, or 12.4% of net sales, for the three months ended June 30, 2025. The decrease in gross margin as a percentage of sales was due to reduced economies of scale at our Puerto Rico manufacturing facility.
Three Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
OPERATING EXPENSES $ 41,119 $ 36,125 $ 4,994 13.8 %
% of Net Sales 34.7 % 34.2 % 0.5 %
Operating expenses for the three months ended June 30, 2026 were $41.1 million, or 34.7% of net sales, compared to $36.1 million, or 34.2% of net sales, for the three months ended June 30, 2025. The increase in operating expenses as a percentage of net sales was due to an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy filing in the second quarter of 2026.
Three Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
INTEREST EXPENSE AND OTHER - net $ (1,995 ) $ (2,519 ) $ 524 (20.8 )%
Interest Expense and Other - net for the three months ended June 30, 2026 was $2.0 million compared to $2.5 million in the year-ago period. The decrease in interest expense was due to lower debt levels.
Three Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
INCOME TAXES:
Income Tax Expense $ 3,809 $ 1,029 $ 2,780 270.2 %
Effective Tax Rate 21.5 % 22.2 % (0.7 )%
The decrease in our effective tax rate in the second quarter of 2026 compared to the year-ago period was primarily due to the mix of earnings between the United States and our international subsidiaries.
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Six Months Ended June 30, 2026 compared to Six Months Ended June 30, 2025
Six Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
NET SALES:
Wholesale $ 157,221 $ 147,877 $ 9,344 6.3 %
Retail 78,943 66,386 12,557 18.9
Contract Manufacturing 6,605 5,457 1,148 21.0
Total Net Sales $ 242,769 $ 219,720 $ 23,049 10.5 %
Wholesale segment net sales for the six months ended June 30, 2026 were $157.2 million compared to $147.9 million for the six months ended June 30, 2025. The increase in Wholesale segment net sales was due to price increases that went into effect in the third quarter of 2025, and increased demand across several key styles and brands. As part of a strategic initiative, we continue to build upon the lifestyle component of our outdoor category to broaden our distribution and consumer reach. Additionally, we offered select incentives to capture additional shelf space with key customers, and opportunistic selling of more discontinued styles in this year’s second quarter. The combination of these factors helped drive increased volume in the first half of 2026 compared to the prior year period.
Retail segment net sales for the six months ended June 30, 2026 were $78.9 million compared to $66.4 million for the six months ended June 30, 2025. The increase was attributed to increases in our owned e-commerce website net sales, our Lehigh CustomFit business, and third-party marketplace net sales. We upgraded our e-commerce platform during the third quarter of 2025 and have increased our investments in digital advertising, driving more traffic to our website and increasing our net sales in the second quarter of 2026 compared to the prior year period. We experienced an increase in our Lehigh CustomFit business as we continue to expand our customer base and increase product offerings. The increase in third-party marketplace platforms was attributed to increased presence within the marketplace space as well as price increases.
Contract Manufacturing net sales for the six months ended June 30, 2026 were $6.6 million compared to $5.5 million for the six months ended June 30, 2025. The increase in Contract Manufacturing net sales was due to increased sales to the U.S. Military.
Six Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.)
GROSS MARGIN:
Wholesale Margin $'s $ 67,596 $ 59,588 $ 8,008
Margin % 43.0 % 40.3 % 2.7 %
Retail Margin $'s $ 38,031 $ 30,200 $ 7,831
Margin % 48.2 % 45.5 % 2.7 %
Contract Manufacturing Margin $'s $ 611 $ 501 $ 110
Margin % 9.3 % 9.2 % 0.1 %
Total Margin $'s $ 106,238 $ 90,289 $ 15,949
Margin % 43.8 % 41.1 % 2.7 %
Wholesale segment gross margin for the six months ended June 30, 2026 was $67.6 million, or 43.0% of net sales, compared to $59.6 million, or 40.3% of net sales, for the six months ended June 30, 2025. The increase in Wholesale segment gross margin as a percentage of net sales in the first half of 2026 compared to the first half of 2025 was primarily due to the recognition of actual and expected IEEPA tariff refunds, which reduced cost of goods sold in the second quarter of 2026, partially offset by tariff-related costs and sourcing variances. The net impact of the aforementioned tariff refunds and tariff costs for the six months ended June 30, 2026 resulted in a net impact of $6.3 million as a reduction to costs of goods sold to our Wholesale segment. Additionally, the increase in Wholesale segment gross margin as a percentage of net sales was also due to a favorable shift in our branded sales mix, with our rubber boot brands delivering stronger growth relative to the rest of the brands in our portfolio. The increase in Wholesale segment gross margin as a percentage of net sales in the first half of 2026 compared to the prior year period was partially offset by higher discontinued product sales as we continue to optimize our inventory position as well as additional promotions and discounts offered to several key customers in an effort to gain additional shelf space.
Retail segment gross margin for the six months ended June 30, 2026 was $38.0 million, or 48.2% of net sales, compared to $30.2 million, or 45.5% of net sales, for the six months ended June 30, 2025. The increase in Retail segment gross margin as a percentage of net sales was due to the recognition of actual and expected IEEPA tariff refunds, which reduced cost of goods sold in the second quarter of 2026, partially offset by tariff-related costs and sourcing variances. The net impact of the aforementioned tariff refunds and tariff costs for the six months ended June 30, 2026 resulted in a net impact of $1.5 million as a reduction to cost of goods sold to our Retail segment gross margin. Additionally, the increase in Retail segment gross margins as a percentage of net sales was also attributable to price increases as well as a favorable shift in our branded sales mix, with our rubber boot brands delivering stronger growth relative to the rest of the brands in our portfolio.
Contract Manufacturing gross margin for the six months ended June 30, 2026 was $0.6 million, or 9.3% of net sales, compared to $0.5 million, or 9.2% of net sales, for the six months ended June 30, 2025.
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Six Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
OPERATING EXPENSES $82,919 $74,427 $8,492 11.4 %
% of Net Sales 34.2 % 33.9 % 0.3 %
Operating expenses for the six months ended June 30, 2026 were $82.9 million, or 34.2% of net sales, compared to $74.4 million, or 33.9% of net sales, for the six months ended June 30, 2025. The increase in operating expenses was due to higher logistics costs, primarily outbound freight, associated with the increase in Retail sales as well as an approximate $1.1 million write-off of accounts receivable associated with a customer bankruptcy filing in the second quarter of 2026.
Six Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
INTEREST EXPENSE AND OTHER - net $ (4,029 ) $ (4,874 ) $ 845 (17.3 )%
Interest Expense and Other - net for the six months ended June 30, 2026 was $4.0 million compared to $4.9 million in the year-ago period. The decrease in interest expense was due to lower debt levels.
Six Months Ended
June 30,
($ in thousands) 2026 2025 Inc./ (Dec.) Inc./ (Dec.)
INCOME TAXES:
Income Tax Expense $ 4,151 $ 2,438 $ 1,713 70.3 %
Effective Tax Rate 21.5 % 22.2 % (0.7 )%
The decrease in our effective tax rate in the six months ended June 30, 2026 compared to the year-ago period was primarily due to the mix of earnings between the United States and our international subsidiaries.
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LIQUIDITY AND CAPITAL RESOURCES
Overview
Our principal sources of liquidity are our income from operations, as well as access to the borrowing capacity under our ABL Facility. We believe that we have sufficient liquidity to support our ongoing operations and to re-invest in our business to drive future growth. As of June 30, 2026, we maintained cash and cash equivalents of $2.6 million and had $46.3 million of availability under our ABL Facility. Our primary ongoing operating cash flow requirements are for inventory purchases and other working capital needs, capital expenditures, and payments on our credit facilities.
Our working capital consists primarily of trade receivables and inventory, offset by short-term debt and accounts payable. Our working capital fluctuates throughout the year as a result of our seasonal business cycle and is generally lowest in the months of January through March of each year and highest during the months of May through October of each year. Our cash generated from operations throughout the year is typically sufficient to fund our seasonal working capital requirements; however, we have the ability to borrow on our ABL Facility as needed and, as such, its balance may fluctuate significantly throughout any given year.
In addition to our ABL Facility with outstanding borrowings of $101.3 million as of June 30, 2026, we also have a Term Facility with outstanding borrowings of $22.6 million as of June 30, 2026. Our ABL Facility and Term Facility require us to maintain a minimum fixed charge coverage ratio, as defined in the ABL Agreement. Additionally, the ABL Facility and Term Facility contain restrictions on the amount of dividend payments and the amount of share repurchases of common stock. As of June 30, 2026, we were in compliance with such covenants and restrictions under the ABL Facility and Term Facility. We may utilize portions of our excess cash to prepay certain amounts of long-term debt prior to maturity.
Our capital expenditures primarily relate to investments in information technology, molds and equipment associated with our manufacturing and distribution operations, merchandising fixtures, and projects related to our corporate offices. In 2025, we purchased land for the future expansion of our distribution center in Logan, Ohio and as such it is possible that a significant portion of future capital expenditures may relate to this expansion.
We lease certain machinery, equipment, and manufacturing facilities under operating leases that generally provide for renewal options.
As of June 30, 2026, our material cash requirements from known contractual obligations and commitments relate primarily to our long-term debt and operating leases commitments. See Note 9 - Long-Term Debt to the Unaudited Condensed Consolidated Financial Statement for more information. Based on our current expectations and forecasts of future earnings, we believe our cash generated from operations will provide sufficient liquidity to fund our operations and debt and lease obligations for the next twelve months and beyond.
Cash Flows
Six Months Ended
June 30,
($ in millions) 2026 2025
Operating activities $ 9.7 $ 2.0
Investing activities (4.8 ) (3.9 )
Financing activities (5.2 ) 0.9
Net change in cash and cash equivalents $ (0.3 ) $ (1.0 )
Operating Activities. Net cash provided by operating activities was $9.7 million and $2.0 million for the six months ended June 30, 2026 and 2025, respectively. The increase in cash provided by operating activities was primarily due to an increase in net income resulting from an increase in net sales over the prior year period as well as IEEPA tariff refunds received during the second quarter of 2026. The net change in working capital and other assets and liabilities resulted in cash used by operating activities of $14.5 million and $14.2 million for the six months ended June 30, 2026 and 2025, respectively.
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During the six months ended June 30, 2026, the net change in working capital was primarily impacted by an increase in accounts receivable and a decrease in accrued expenses. The increase in accounts receivable and the decrease in accrued expenses resulted in a use of cash of $16.5 million and $5.0 million, respectively. The increase in accounts receivable was primarily due to the recognition of the IEEPA tariff refunds receivable in the second quarter of 2026. The decrease in accrued expenses for the six months ended June 30, 2026 was a result of a decrease in tariff costs as a result of the U.S. Supreme Court's ruling to invalidate certain IEEPA tariffs in the first quarter of 2026. During the six months ended June 30, 2025, the net change in working capital was primarily impacted by an increase in inventory resulting in a use of cash of $20.1 million. The increase in inventory was a result of the additional tariffs imposed during 2025 as well as increased purchases in order to meet estimated demand in the second half of 2025.
Investing Activities. Net cash used in investing activities for the six months ended June 30, 2026 and 2025 was $4.8 million and $3.9 million, respectively. The use of cash in both periods was a result of capital expenditures for our manufacturing operations, distribution center, and information technology.
Financing Activities. Net cash used in financing activities for the six months ended June 30, 2026 was $5.2 million, and net cash provided by financing activities for the six months ended June 30, 2025 was $0.9 million. The net use of cash for the current year period was primarily due to dividend payments and repurchases of common stock. The net source of cash for the six months ended June 30, 2026 primarily related to proceeds from our revolving credit facility offset by payments on our term loan and dividend payments.
On February 24, 2026, we announced a share repurchase program of up to $7,500,000 of the Company's outstanding common stock, no par value per share. As of June 30, 2026, we repurchased 53,664 shares of common stock under our authorized share repurchase program. The shares were purchased at an aggregate cost of $2.0 million and an average price of $37.09 per share.
We are contingently liable with respect to lawsuits, taxes and various other matters that routinely arise in the normal course of business. See Note 14 - Commitments and Contingencies of our Unaudited Condensed Consolidated Financial Statements for further discussion of legal matters. We do not have off-balance sheet arrangements, financings, or other relationships with unconsolidated entities, also known as "Variable Interest Entities." Additionally, we do not have any related party transactions that materially affect the results of operations, cash flow or financial condition.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of the Company’s Unaudited Condensed Consolidated Financial Statements, which have been prepared in accordance with U.S. GAAP, requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. On an ongoing basis, management evaluates these estimates. Estimates are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Historically, actual results have not been materially different from the Company’s estimates. However, actual results may differ materially from these estimates under different assumptions or conditions.
We have identified the critical accounting policies used in determining estimates and assumptions in the amounts reported in our Management Discussion and Analysis of Financial Conditions and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2025.
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES REFORM ACT OF 1995
This report, including Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, which are intended to be covered by the safe harbors created thereby. Those statements include, but may not be limited to, all statements regarding our and management’s intent, belief, and expectations, such as statements concerning our future profitability and our operating and growth strategy. Words such as “believe,” “anticipate,” “expect,” “will,” “may,” “should,” “intend,” “plan,” “estimate,” “predict,” “potential,” “continue,” “likely,” “would,” “could” and similar expressions are intended to identify forward-looking statements. Investors are cautioned that forward-looking statements involve risk and uncertainties including, without limitations, dependence on sales forecasts, changes in consumer demand, seasonality, impact of weather, competition, reliance on suppliers, risks inherent to international trade, increases or changes in duties and tariffs in countries of import and export, changing retail trends, the loss or disruption of our manufacturing and distribution operations, cybersecurity breaches or disruption of our digital systems, fluctuations in foreign currency exchange rates, economic changes, as well as other factors set forth under the caption “Item 1A, Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2025 (filed March 11, 2026) and other factors detailed from time to time in our filings with the Securities and Exchange Commission. Although we believe that the assumptions underlying the forward-looking statements contained herein are reasonable, any of the assumptions could be inaccurate. Therefore, there can be no assurance that the forward-looking statements included herein will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by us or any other person that our objectives and plans will be achieved. We assume no obligation to update any forward-looking statements.
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