28  I5 Arial5! Arial5" Arial5# Arial5$ Arial5%  Arial5&  Arial5' Arial Unicode MS5( Arial Unicode MS !!""            !!!"!#!$!%%&&'%(& )%*%+& ,'-(.  / 0'1% @   @   @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @   @  @  ! @  " @  $@ @  %@ @  &@ @  '@ @  (@ @  )@ @  *@ @  +@ @  ,@ @  -@ @  .@ @  /@ @  2@ @  4@ @  6@ @  7@ @  8@ @  :@ @  <@ @  >@ @  @@ @  A@ @  B@ @  C@ @  D@ @  E@ @  F@ @  H@ @  J@ @  L@ @  N @  O @  P @  R@ @  S@ @  T@ @  U@ @  W@ @  Y@ @  [@ @  \@ @ ]@ @ @ @ @ _@ @  a@ @  c@ @  d@ @  e@ @  g@ @  i@ @  k@ @  m@ @  o@ @  p@ @  r@ @  t@ @  u@ @  v@ @  x@ @  z@ @  | @  } @  ~ @ @ @ @ @ @ @ @@ @ @ @  @ @  @ @  @  @ @ @   @  @  @ @ @   @ @ @ @  @ @ @@ @  @@ @   @ @  @ @ @   @ @ @ @  @ @ @@ @  @@ @   @@ @   @ @  @ @  @  @  @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @  @ @ @ @ @ @ @  @ @ @  @ @  @ @  @ @  @ @  q@' q@' q@'q0*'ROCKY SHOES & BOOTS, INC.'AND SUBSIDIARIES!'CONSOLIDATED BALANCE SHEETS^DECEMBER 31,^DECEMBER 31, ^2002 ^2001'CURRENT ASSETS:"' Cash and cash equivalents"$ 4,276,722"$ 2,954,935'' Accounts receivable-trade, net"15,282,618"15,091,100 ' Other receivables "1,173,714 "2,225,498 ' Inventories "23,181,989 "27,713,664& ' Deferred income taxes-current "584,511 "615,609 ' Other current assets "1,267,097 "1,053,192&' Total current assets"45,766,651"49,653,998'FIXED ASSETS, AT COST:&' Property, plant and equipment"45,238,866"43,024,219&' Less accumulated depreciation"(26,189,579)"(22,258,125)(' Total fixed assets-net"19,049,287"20,766,094'DEFERRED PENSION ASSET"1,651,222"1,802,922'DEFERRED INCOME TAXES "153,495 "295,784'OTHER ASSETS"1,796,359"2,141,016'TOTAL ASSETS"$ 68,417,014"$ 74,659,8145'See notes to consolidated financial statements. 'ROCKY SHOES & BOOTS, INC.!'AND SUBSIDIARIES!"'CONSOLIDATED BALANCE SHEETS$^DECEMBER 31,$^DECEMBER 31, %^2002 %^2001&'CURRENT LIABILITIES:'' Accounts payable'"$ 1,642,306'"$ 1,559,444*(' Current maturities-long-term debt ("486,161 ("469,143)' Accrued expenses:*' Taxes-other *"346,168 *"991,295+' Salaries and wages +"807,611 +"985,992,' Plant closing costs ,"210,000 ,"903,291-' Co-op advertising -"270,390 -"231,862.' Interest ."90,408 ."121,417/' Other /"162,320 /"124,659.2' Total current liabilities2"4,015,3642"5,387,103,4'LONG-TERM DEBT-Less current maturities4"10,488,3884"16,976,0236'DEFERRED LIABILITIES:7' Compensation 7"160,000 7"155,5648' Pension8"1,360,3388"1,097,791/:' Total deferred liabilities:"1,520,338:"1,253,355&<' Total liabilities<"16,024,090<"23,616,481#>'COMMITMENTS AND CONTINGENCIES@'SHAREHOLDERS' EQUITY:DA' Preferred stock, Series A, no par value, $.06 stated value;)B' none outstanding 2002 and 2001BC' Common stock, no par value; 10,000,000 shares authorized;?D' outstanding 2002-4,489,065 and 2001-4,492,215 sharesD"35,289,038D"35,302,159-E' Accumulated other comprehensive lossE"(2,311,749)E"(831,161)F' Retained earningsF"19,415,635F"16,572,335/H' Total shareholders' equityH"52,392,924H"51,043,3330J'TOTAL LIABILITIES AND SHAREHOLDERS' EQUITYJ"$ 68,417,014J"$ 74,659,8145L'See notes to consolidated financial statements.N'ROCKY SHOES & BOOTS, INC.O'AND SUBSIDIARIES'P'CONSOLIDATED STATEMENTS OF INCOMER^YEARS ENDED DECEMBER 31,R^YEARS ENDED DECEMBER 31,R^YEARS ENDED DECEMBER 31, S^2002 S^2001 S^2000U'NET SALESU"$ 88,958,721U"$ 103,319,806U"$ 103,228,987W'COST OF GOODS SOLDW"65,528,213W"80,067,866W"78,617,092Y'GROSS MARGINY"23,430,508Y"23,251,940Y"24,611,895['OTHER OPERATING EXPENSES:5\' Selling, general and administrative expenses\"18,661,730\"18,175,943\"21,426,758]' Plant closing costs]"1,500,0003_' Total other operating expenses_"18,661,730_"19,675,943_"21,426,758a'INCOME FROM OPERATIONSa"4,768,778a"3,575,997a"3,185,137"c'OTHER INCOME AND (EXPENSES):d' Interest expensed"(1,404,496)d"(2,493,533)d"(3,354,388)e' Other-net e"432,018 e"354,920 e"449,257$g' Total other-netg"(972,478)g"(2,138,613)g"(2,905,131) i'INCOME BEFORE INCOME TAXESi"3,796,300i"1,437,384 i"280,006"k'INCOME TAX EXPENSE (BENEFIT) k"953,000k"(93,438) k"183,464m'NET INCOMEm"$ 2,843,300m"$ 1,530,822m"$ 96,542"o'NET INCOME PER COMMON SHARE:p' Basicp"$ 0.63p"% 0.34p"$ 0.02r' Dilutedr"$ 0.62r"$ 0.34r"$ 0.02t'WEIGHTED AVERAGE COMMONu' SHARES OUTSTANDING:v' Basicv"$ 4,499,741v"$ 4,489,322v"$ 4,489,215x' Dilutedx"$ 4,590,095x"$ $4,548,632x"$ 4,493,3045z'See notes to consolidated financial statements.|'ROCKY SHOES & BOOTS, INC.}'AND SUBSIDIARIES5~'CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY^COMMON STOCK^ACCUMULATED OTHER ^TOTAL ^SHARES^COMPREHENSIVE^RETAINED^SHAREHOLDERS'^OUTSTANDING ^AMOUNT ^LOSS^EARNINGS ^EQUITY'BALANCE-December 31, 1999"4,489,215"$ 35,284,159"$ -"$ 14,944,971"$ 50,229,130#'YEAR ENDED DECEMBER 31, 2000-,' Net income and comprehensive income "96,542 "96,542'BALANCE-December 31, 2000"4,489,215"35,284,159"15,041,513"50,325,672#'YEAR ENDED DECEMBER 31, 2001:' Net income"1,530,822"1,530,8226' Minimum pension liability, net of tax benefit' of $323,229"(831,161)"(831,161)' Comprehensive income "699,661 ' Stock options exercised "3,000 "18,000 "18,000'BALANCE-December 31, 2001"4,492,215"35,302,159"(831,161)"16,572,335"51,043,333#'YEAR ENDED DECEMBER 31, 2002:' Net income"2,843,300"2,843,3006' Minimum pension liability, net of tax benefit' of $575,784"(1,480,588)"(1,480,588)' Comprehensive income"1,362,712-' Treasury stock purchased and retired"(16,400)"(84,540)"(84,540) ' Stock options exercised "13,250 "71,419 "71,419'BALANCE-December 31, 2002"4,489,065 $"35,289,038"$ (2,311,749)"$ 19,415,635"$ 52,392,9245'See notes to consolidated financial statements.'ROCKY SHOES & BOOTS, INC.'AND SUBSIDIARIES+'CONSOLIDATED STATEMENTS OF CASH FLOWS^YEARS ENDED DECEMBER 31,^YEARS ENDED DECEMBER 31,^YEARS ENDED DECEMBER 31, ^2002 ^2001 ^2000+'CASH FLOWS FROM OPERATING ACTIVITIES:' Net income"$2,843,300"$1,530,822 "$96,5423' Adjustments to reconcile net income to net1' cash provided by operating activities:(' Depreciation and amortization"4,032,442"4,409,361"4,698,554 ' Deferred income taxes "749,171"(52,152)"(46,954)0' Deferred compensation and pension-net"(1,637,689)"(1,661,232)"(468,522)'' Loss on sale of fixed assets"(15,904) "353,681 "32,116,' Change in assets and liabilities:' Receivables "860,266"3,696,183"2,927,201' Inventories"4,531,675"4,321,573 "537,830!' Other current assets"(213,905) "242,095"(72,373)' Other assets "321,088 "14,731"(469,514)' Accounts payable "85,479"(1,936,064)"1,551,745' Accrued expenses"(1,471,619)"1,134,840 "335,969;' Net cash provided by operating activities"10,084,304"12,053,838"9,122,594+'CASH FLOWS FROM INVESTING ACTIVITIES:!' Purchase of fixed assets"(2,338,388)"(1,172,365)"(3,113,529)+' Proceeds from sale of fixed assets "59,609 "7,952 "39,7707' Net cash used in investing activities"(2,278,779)"(1,164,413)"(3,073,759)+'CASH FLOWS FROM FINANCING ACTIVITIES:%' Proceeds from long-term debt"87,589,294"96,926,759"106,607,246#' Payments on long-term debt"(94,059,911)"(106,997,243)"(112,868,411)#' Purchase of treasury stock"(84,540)0' Proceeds from exercise of stock options "71,419 "18,0007' Net cash used in financing activities"(6,483,738)"(10,052,484)"(6,261,165)6'INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS"1,321,787 "836,941"(212,330)1'CASH AND CASH EQUIVALENTS-Beginning of year"2,954,935"2,117,994"2,330,324+'CASH AND CASH EQUIVALENTS-End of year"$4,276,722"$2,954,935"$2,117,9945'See notes to consolidated financial statements. 6Sheet1 6Sheet2 6Sheet3d_ ArialArial Unicode MS  O4!*d"""dFM3FM3 PropertyWK3WK3 Property  ; 9; ~;9q; m;CMHdr;