Operating income was $15.7 million, or 14.7% of sales, compared with $18.5 million, or 17% of sales. In line with expectations, net income fell to $9.5 million from $10.9 million.

Revenues from the wholesale business slipped slightly to $82.3 million from $83 million, principally due to the discontinuation of the company’s Rule and l.e.i lines. Gross margin in the wholesale business was 36.2% compared with 41.1% in the prior year, reflecting margin pressure from the poor performance of boots in Steve Madden Women's, sport fusion in Steve Madden Men's and Betsey Johnson handbags in the Daniel M. Friedman division.

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