K-Swiss Earnings Drop 26%

Athletic footwear maker K-Swiss Inc. said Thursday that fourth-quarter net income fell 26% because of higher income tax expenses.

The Westlake Village-based company, which has made classic leather tennis shoes for 40 years, said net income declined to $11.6 million, or 33 cents a share, in the quarter ended Dec. 31.

That compares with $15.6 million, or 43 cents, in the year-earlier quarter, when the company had a tax benefit on overseas profit.

Revenue rose 4.5% to $92.3 million, K-Swiss said.

Shares of K-Swiss fell $2.46, or 7.9%, to $28.83. The stock had lost 1.3% in the 12 months before Thursday.

K-Swiss does not expect “as rosy an outlook as we have enjoyed of late” in 2006, Chairman Steven Nichols said in a statement.

Domestic footwear sales fell 5.9% to $64.3 million in the fourth quarter, and domestic orders for the first half of 2006 fell 13% to $148.7 million, the company said.

K-Swiss said it expected per-share earnings this year of $1.70 to $1.85 on revenue of $480 million to $500 million. The company reported net income for last year of $75.3 million, or $2.11 a share, on $508.6 million in revenue.