Second quarter 2011 net income improved to $2.3 million or $0.30 per diluted share versus net income of $0.5 million, or $0.08 per diluted share in the year ago period. Excluding one-time charges of $0.6 million, net of tax, associated with the early repayment of a portion of the Company’s senior term loan, second quarter 2010 net income was $1.1 million, or $0.17 per diluted share. The earnings per share improvement was attained even with 933,000, or 14.2% more weighted average common shares outstanding as a result of the Company's follow-on common stock offering in May 2010. Gross margin improved 480 basis points to 39.4% compared to 34.6% last year. Net sales were $52.3 million for the second quarter versus net sales of $55.2 million in the second quarter of 2010, due to reduced sales under military contracts.

David Sharp, President and Chief Executive Officer, commented, “We are very pleased to report our eighth consecutive quarter of improved profitability on a year-over-year basis. The increase in our bottom line over the past 24 months has primarily been achieved through increased operating efficiencies, higher gross margins and more recently reduction in interest expense. As a result of our stronger balance sheet and the restructuring of our retail division behind us, we are positioned to drive future earnings gains through top-line growth in our wholesale and retail segments. We continue to be confident that our portfolio of brands has the potential to expand into other categories and new markets internationally and we are pursuing strategies to capitalize on these opportunities. We will also look to take further advantage of our internal manufacturing capabilities to improve in-stock positions on popular styles, increase our speed to market, and reduce costs.”

Net sales for the second quarter were $52.3 million compared to $55.2 million a year ago. Wholesale sales for the second quarter increased 6.0% to $40.8 million compared to $38.5 million for the same period in 2010. Retail sales for the second quarter were $10.9 million compared to $11.0 million for the same period last year. Military segment sales for the second quarter decreased $5.1 million to $0.6 million compared to $5.7 million in the same period in 2010.

Gross margin in the second quarter of 2011 was $20.6 million, or 39.4% of sales compared to $19.1 million, or 34.6% for the same period last year. The 480 basis point improvement in gross margin as a percentage of sales was primarily attributable to the decrease in sales in our military segment which carry lower gross margins than our retail and wholesale segments coupled with higher average selling prices. In addition, we benefited from a 290 basis point increase in our wholesale segment and a 250 basis point increase in our retail segment driven by higher average selling prices and improved manufacturing efficiencies.

Interest expense decreased $1.8 million to $0.3 million for the second quarter of 2011 versus $2.1 million for the same period last year which included one-time fees of approximately $0.9 million, pre-tax, associated with the early repayment of a portion of the Company’s senior term loan. Excluding the one-time fees from a year ago, the decrease is attributable to lower interest rates as the result of the new $70 million revolving credit facility signed in October 2010.

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities and Exchange Act of 1934, 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 intent, beliefs, expectations, projections, forecasts, and plans of the Company and its management, and include statements in this press release regarding future growth opportunities and internal manufacturing capabilities (paragraph 3). These forward-looking statements involve numerous risks and uncertainties, including, without limitation, the various risks inherent in the Company’s business as set forth in periodic reports filed with the Securities and Exchange Commission, including the Company’s annual report on Form 10-K for the year ended December 31, 2010 (filed March 2, 2011) and the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2011 (filed May 3, 2011). One or more of these factors have affected historical results, and could in the future affect the Company’s businesses and financial results in future periods and could cause actual results to differ materially from plans and projections. Therefore there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the Company, or any other person should not regard the inclusion of such information as a representation that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to the management of the Company. The Company assumes no obligation to update any forward-looking statements.

	June 30, 2011			December 31, 2010			June 30, 2010
	Unaudited			Audited			Unaudited
ASSETS:

CURRENT ASSETS:
Cash and cash equivalents	$	3,194,944		$	4,362,531		$	3,166,143
Trade receivables – net		41,965,418			47,593,807			40,782,470
Other receivables		770,106			911,103			1,182,335
Inventories		74,391,866			58,852,556			61,811,667
Deferred income taxes		1,218,101			1,218,101			1,475,695
Prepaid expenses		2,783,290			1,793,852			2,202,381
Total current assets		124,323,725			114,731,950			110,620,691
FIXED ASSETS – net		23,501,917			22,129,282			22,436,535
IDENTIFIED INTANGIBLES		30,504,268			30,495,485			30,512,822
OTHER ASSETS		931,133			1,222,712			2,112,475
TOTAL ASSETS	$	179,261,043		$	168,579,429		$	165,682,523


LIABILITIES AND SHAREHOLDERS' EQUITY:

CURRENT LIABILITIES:
Accounts payable	$	13,000,426		$	9,024,851		$	13,415,750
Current maturities – long term debt		6,865			487,480			528,434
Accrued expenses:
Taxes - other		714,528			590,217			535,101
Income tax payable		836,171			422,229			-
Other		4,194,173			6,050,964			4,931,764
Total current liabilities		18,752,163			16,575,741			19,411,049
LONG TERM DEBT – less current maturities		39,517,005			34,608,338			36,370,863
DEFERRED INCOME TAXES		9,374,685			9,374,685			9,071,639
DEFERRED LIABILITIES		3,151,262			3,017,107			3,875,048
TOTAL LIABILITIES		70,795,115			63,575,871			68,728,599

SHAREHOLDERS' EQUITY:
Common stock, no par value;
25,000,000 shares authorized; issued and outstanding June 30, 2011 - 7,489,995; December 31, 2010 - 7,426,787; June 30, 2010 - 7,406,787		69,546,028			69,052,101			68,931,586

Accumulated other comprehensive loss		(2,681,862	)		(2,828,989	)		(3,037,242	)
Retained earnings		41,601,762			38,780,446			31,059,580

Total shareholders' equity		108,465,928			105,003,558			96,953,924

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$	179,261,043		$	168,579,429		$	165,682,523

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2011			2010			2011			2010
NET SALES	$	52,282,632		$	55,223,054		$	104,588,907		$	111,302,040

COST OF GOODS SOLD		31,665,304			36,123,970			64,705,634			73,446,107

GROSS MARGIN		20,617,328			19,099,084			39,883,273			37,855,933

SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES		16,853,029			16,163,354			35,082,380			34,188,041

INCOME FROM OPERATIONS		3,764,299			2,935,730			4,800,893			3,667,892

OTHER INCOME AND (EXPENSES):
Interest expense		(292,454	)		(2,121,552	)		(507,986	)		(3,766,143	)
Other – net		34,855			3,432			47,409			40,117
Total other - net		(257,599	)		(2,118,120	)		(460,577	)		(3,726,026	)

INCOME/(LOSS) BEFORE INCOME TAXES		3,506,700			817,610			4,340,316			(58,134	)

INCOME TAX EXPENSE/(BENEFIT)		1,227,000			294,000			1,519,000			(21,000	)

NET INCOME/(LOSS)	$	2,279,700		$	523,610		$	2,821,316		$	(37,134	)

INCOME/(LOSS) PER SHARE
Basic	$	0.30		$	0.08		$	0.38		$	(0.01	)
Diluted	$	0.30		$	0.08		$	0.38		$	(0.01	)

WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING
Basic		7,489,995			6,535,812			7,483,259			6,072,045
Diluted		7,489,995			6,557,289			7,483,259			6,072,045

	ROCKY BRANDS, INC.

	Company Contact:	Jim McDonald
		Chief Financial Officer
		(740) 753-1951

	Investor Relations:	ICR, Inc.
		Brendon Frey
		(203) 682-8200