McRae Industries Profit Slumps Amid Tariff Costs and Lower Boot Demand

The company reported consolidated net revenues of $27.4 million for the third quarter, down from $30.9 million a year prior. Beyond the Laredo brand’s weakness, the work boot division struggled as military-related orders cooled. Profit margins were further squeezed by $0.8 million in tariff payments during the quarter alone. While management indicated it is pursuing refunds for these costs, it acknowledged that recovery remains uncertain.

Despite the quarterly slump, the company secured a $15.4 million contract from the U.S. Government DLA Troop Support in late April to supply Airforce temperate weather boots over the next three years. Liquidity remains stable, with $20.6 million in cash and cash equivalents on hand. However, the company’s operating profit for the first nine months of fiscal 2026 sits at $2.6 million, less than half the $6.1 million generated during the same timeframe in 2025.