Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Jim Duffy – Thomas Weisel Partners.
Jim Duffy – Thomas Weisel Partners
My question relates to the SG&A, typically you see a greater sequential decline in SG&A from the first quarter to the second quarter and contemplating that you had $3.5 million of benefits from restructuring on a pro forma basis, can you provide a little commentary about SG&A dynamics during the quarter.
Donald T. Grimes
Just to clarify, that $3.5 million of benefits Jim, not all of it was in SG&A. There was a fair portion of that benefit in cost of sales.
Jim Duffy – Thomas Weisel Partners
What would that split be Don?
Donald T. Grimes
We cited earlier in the year that about two thirds of SG&A and one third cost of sales when we were talking about the full year $17 to $19 million that’s a good number for the second quarter as well. One additional comment regarding SG&A, or two comments actually, there are some timing issues as it relates to some of the marketing advertising spend that hurt a little bit the Q2 SG&A performance compared to the first quarter. The second comment is that we had a bit of a true up of our incentive comp accrual. There’s a portion of our incentive comp programs that are driven by total shareholder returns and the very nice and very justifiable run up that we had in the second quarter on the Wolverine share price contributed to an adjustment to that accrual as of the end of Q2 which contributed about $1 million of incremental SG&A in the quarter.
Operator
Your next question comes from Scott Krasik – C. L. King & Associates, Inc.
Scott Krasik – C. L. King & Associates, Inc.
Your comments Blake about feeling better about the backlog, you had previously talked about the third quarter being the weakest quarter of the year and I know currency is going to play in to that but, maybe talk about the visibility, what you’re seeing on the fall orders and also have you heard any commentary from retailers that they feel more confident about bringing spring 2010 orders in any earlier? I know they didn’t do much of that a year ago?
Blake W. Kruger
First let me see if I can address your backlog questions first. For our business backlog has been a good indicator of future performance in past years. Over the last two or three quarters it has become less of an accurate indicator for a number of reasons and frankly, that has to do with the Q3 and Q4 impact of the economic slowdown last year. So, if you look at our backlog today, as Don indicated, the quality of our backlog is much higher than it has been historically.
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