• Net Sales
$57.9 Million – Up
6.4%
• Gross Margin
45.7%
• Traditional Channel Sales
$34.5 Million – Up
8.7%
• E-Commerce
Channel Sales $23.4 Million – Up
3.3%
COLUMBIA, Mo., Nov. 30,
2023 /PRNewswire/ -- American Outdoor Brands,
Inc. (NASDAQ Global Select: AOUT), an industry leading provider
of products and accessories for rugged outdoor enthusiasts, today
announced financial results for the second quarter of fiscal 2024
ended October 31, 2023.
Second Quarter Fiscal 2024 Financial Highlights
- Quarterly net sales were $57.9
million, an increase of $3.5
million, or 6.4%, compared with net sales of $54.4 million for the comparable quarter last
year. Traditional channel net sales increased 8.7%, while
e-commerce net sales increased 3.3%. Compared with pre-COVID levels
in fiscal 2020, quarterly net sales increased 21.3%.
- Quarterly gross margin was 45.7%, a decrease of 200 basis
points, compared with quarterly gross margin of 47.7% for the
comparable quarter last year.
- Quarterly GAAP net income was $77,000, or $0.01
per diluted share, compared with GAAP net income of $370,000, or $0.03
per diluted share, for the comparable quarter last year.
- Quarterly non-GAAP net income was $3.3
million, or $0.25 per diluted
share, compared with non-GAAP net income of $4.0 million, or $0.29 per diluted share, for the comparable
quarter last year. GAAP to non-GAAP adjustments for net income
exclude acquired intangible amortization, stock compensation,
technology implementation, and other costs. For a detailed
reconciliation, see the schedules that follow in this release.
- Quarterly non-GAAP Adjusted EBITDAS was $5.2 million, or 9.0% of net sales, compared with
$6.4 million, or 11.8% of net sales,
for the comparable quarter last year. For a detailed
reconciliation, see the schedules that follow in this release.
Brian Murphy, President and Chief
Executive Officer, said, "Our second quarter results reflect solid
performance in net sales and capital management, as well as ongoing
progress against our long-term strategic objectives. Net
sales grew by 6.4% compared with the second quarter last year, a
result that exceeded our expectations and represented growth of
more than 21% over our pre-pandemic second quarter of fiscal 2020.
Our shooting sports category saw a slight decline in net
sales compared with the prior year, consistent with industry trends
in that space. That decline was offset by growth in our outdoor
lifestyle category, demonstrating the strength of our brands in
this growing part of our business. In fact, our outdoor
lifestyle category accounted for nearly 60% of our total net sales
in the second quarter. We believe this growth reflects our
strategy to intentionally place our brands where consumers expect
to find them, whether online or in-store. Accordingly, both
our e-commerce and our traditional channels delivered net sales
growth in the second quarter.
"Retail expansion is an important part of our growth
strategy. During the second quarter, we were proud to join
forces with Academy Sports + Outdoors to bring Academy customers a
select lineup of our MEAT! Your Maker brand meat processing
equipment. Originally launched in 2019 as an entirely new,
exclusively direct-to-consumer brand of high-quality meat
processing equipment, MEAT! quickly developed a loyal following
among consumers who appreciate the brand's premium, professional
grade equipment quality, its commitment to user education, its
industry-leading lifetime warranty, and its authentic
personality. The expansion into Academy marks an important
milestone for our MEAT! brand and provides us a great opportunity
to introduce this exciting product lineup to new, potential
customers through one of the industry's leading
retailers."
Andrew Fulmer, Chief Financial
Officer, said, "In the second quarter of fiscal 2024, we delivered
net sales growth; we maintained a strong balance sheet; and we
continued to return cash to stockholders through our share
repurchase program, all while continuing to navigate market
uncertainty stemming from cautious inventory management by
retailers, and reduced consumer demand. We continued to
maintain a strong balance sheet, ending the quarter with
$8.4 million in cash and no debt,
after repurchasing approximately $1.5
million of our common stock."
"We believe our brands remain well positioned to capitalize on
positive, long-term consumer outdoor participation trends. As
a result, we continue to believe that our net sales for fiscal 2024
could exceed fiscal 2023 net sales by as much as 3.5%. We
also believe our solid financial position enables us to continue
investing in our business, returning capital to our stockholders,
and addressing the exciting growth opportunities we have identified
for our company," concluded Fulmer.
Conference Call and Webcast
The Company will host a
conference call and webcast today, November
30, 2023, to discuss its second quarter fiscal 2024
financial and operational results. Speakers on the conference call
will include Brian Murphy, President
and Chief Executive Officer, and Andrew
Fulmer, Chief Financial Officer. The conference call
may include forward-looking statements and a discussion of non-GAAP
financial measures. The conference call and webcast will begin at
5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). Those interested in
listening to the conference call via telephone may call directly at
(833) 630-1956 and ask to join the American Outdoor Brands
call. No RSVP is necessary. The conference call audio
webcast can also be accessed live on the Company's website at
www.aob.com, under the Investor Relations section.
Reconciliation of U.S. GAAP to Non-GAAP Financial
Measures
In this press release, certain non-GAAP financial
measures, including "non-GAAP net income and "Adjusted EBITDAS" are
presented. A reconciliation of these and other non-GAAP financial
measures are contained at the end of this press release. From time
to time, the Company considers and uses these non-GAAP financial
measures as supplemental measures of operating performance in order
to provide the reader with an improved understanding of underlying
performance trends. The Company believes it is useful for
itself and the reader to review, as applicable, both (1) GAAP
measures that include (i) amortization of acquired intangible
assets, (ii) stock compensation, (iii) facility consolidation
costs, (iv) technology implementation, (v) acquisition costs, (vi)
stockholder cooperation agreement costs, (vii) income tax
adjustments, (viii) interest expense, (ix) income tax expense, and
(x) depreciation and amortization; and (2) the non-GAAP measures
that exclude such information. The Company presents these non-GAAP
measures because it considers them an important supplemental
measure of its performance and believes the disclosure of such
measures provides useful information to investors regarding the
Company's financial condition and results of operations. The
Company's definition of these adjusted financial measures may
differ from similarly named measures used by others. The Company
believes these measures facilitate operating performance
comparisons from period to period by eliminating potential
differences caused by the existence and timing of certain expense
items that would not otherwise be apparent on a GAAP basis.
These non-GAAP measures have limitations as an analytical tool and
should not be considered in isolation or as a substitute for the
Company's GAAP measures. The principal limitations of these
measures are that they do not reflect the Company's actual expenses
and may thus have the effect of inflating its financial measures on
a GAAP basis.
About American Outdoor Brands, Inc.
American Outdoor Brands, Inc. (NASDAQ Global Select: AOUT) is an
industry leading provider of outdoor products and accessories,
including hunting, fishing, camping, shooting, outdoor cooking, and
personal security and defense products, for rugged outdoor
enthusiasts. The Company produces innovative, top quality
products under its brands BOG®; BUBBA®; Caldwell®; Crimson Trace®;
Frankford Arsenal®; Grilla Grills®; Hooyman®; Imperial®;
LaserLyte®; Lockdown®; MEAT!; Old Timer®; Schrade®; Tipton®; Uncle
Henry®; ust®; and Wheeler®. For more information about all
the brands and products from American Outdoor Brands, Inc., visit
www.aob.com.
Safe Harbor Statement
Certain statements contained in
this press release may be deemed to be forward-looking statements
under federal securities laws, and we intend that such
forward-looking statements be subject to the safe harbor created
thereby. All statements other than statements of historical facts
contained or incorporated herein by reference in this press
release, including statements regarding our future operating
results, future financial position, business strategy, objectives,
goals, plans, prospects, markets, and plans and objectives for
future operations, are forward-looking statements. In some cases,
you can identify forward-looking statements by terms such as
"anticipates," "believes," "estimates," "expects," "intends,"
"targets," "contemplates," "projects," "predicts," "may," "might,"
"plan," "would," "should," "could," "may," "can," "potential,"
"continue," "objective," or the negative of those terms, or similar
expressions intended to identify forward-looking statements.
However, not all forward-looking statements contain these
identifying words. Specific forward-looking statements in this
press release include our strategy to intentionally place our
brands where consumers expect to find them, whether online or
in-store; our belief that our brands remain well positioned to
capitalize on positive, long-term consumer outdoor participation
trends; our continued belief that our net sales for fiscal 2024
could exceed fiscal 2023 net sales by as much as 3.5%; and our
belief that our solid financial position enables us to continue
investing in our business, returning capital to our stockholders,
and addressing the exciting growth opportunities we have identified
for our company. We caution that these statements are qualified by
important risks, uncertainties, and other factors that could cause
actual results to differ materially from those reflected by such
forward-looking statements. Such factors include, among others,
potential disruptions in our ability to source the materials
necessary for the production of our products, disruptions and
delays in the manufacture of our products, and difficulties
encountered by retailers and other components of the distribution
channel for our products; economic, social, political, legislative,
and regulatory factors; lawsuits and their effect on us; inventory
levels, both internally and in the distribution channel, in excess
of demand; natural disasters, pandemics, seasonality, news events,
political events, and consumer tastes; future investments for
capital expenditures; future products and product development; the
features, quality, and performance of our products; the success of
our strategies and marketing programs; our market share and factors
that affect our market share; liquidity and anticipated cash needs
and availability; the supply, availability, and costs of materials
and components and related tariffs; our ability to maintain and
enhance brand recognition and reputation; risks associated with the
distribution of our products and overall availability of labor; and
other factors detailed from time to time in our reports filed with
the Securities and Exchange Commission, including our Annual Report
on Form 10-K for the fiscal year ended April
30, 2023.
AMERICAN OUTDOOR
BRANDS, INC. AND SUBSIDIARIES
|
CONSOLIDATED BALANCE
SHEETS
|
|
As
of:
|
|
October 31,
2023
|
|
April 30,
2023
|
|
(Unaudited)
|
|
|
|
(In thousands, except
par value and share data)
|
ASSETS
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
8,379
|
|
$
21,950
|
Accounts receivable,
net of allowance for credit losses of $129
on October 31, 2023 and $125 on April 30,
2023
|
40,447
|
|
26,846
|
Inventories
|
109,123
|
|
99,734
|
Prepaid expenses and
other current assets
|
6,016
|
|
7,839
|
Income tax
receivable
|
301
|
|
1,251
|
Total current
assets
|
164,266
|
|
157,620
|
Property, plant, and
equipment, net
|
8,783
|
|
9,488
|
Intangible assets,
net
|
46,351
|
|
52,021
|
Right-of-use
assets
|
23,736
|
|
24,198
|
Other assets
|
514
|
|
260
|
Total
assets
|
$
243,650
|
|
$
243,587
|
LIABILITIES
AND EQUITY
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
17,805
|
|
$
11,544
|
Accrued
expenses
|
12,271
|
|
8,741
|
Accrued payroll,
incentives, and profit sharing
|
2,932
|
|
1,813
|
Lease liabilities,
current
|
985
|
|
904
|
Total current
liabilities
|
33,993
|
|
23,002
|
Notes and loans
payable
|
—
|
|
4,623
|
Lease liabilities, net
of current portion
|
23,648
|
|
24,064
|
Other non-current
liabilities
|
18
|
|
34
|
Total
liabilities
|
57,659
|
|
51,723
|
Equity:
|
|
|
|
Preferred stock,
$0.001 par value, 20,000,000 shares authorized, no
shares issued or outstanding
|
—
|
|
—
|
Common stock,
$0.001 par value, 100,000,000 shares authorized,
14,605,941 shares issued and 12,966,416 shares
outstanding on
October 31, 2023 and 14,447,149 shares issued and
13,233,151
outstanding on April 30, 2023
|
15
|
|
14
|
Additional paid in
capital
|
274,708
|
|
272,784
|
Retained
deficit
|
(66,411)
|
|
(62,375)
|
Treasury stock, at cost
(1,481,989 shares on October 31, 2023
and 1,213,998 shares on April 30, 2023)
|
(22,321)
|
|
(18,559)
|
Total
equity
|
185,991
|
|
191,864
|
Total liabilities and
equity
|
$
243,650
|
|
$
243,587
|
AMERICAN OUTDOOR
BRANDS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF OPERATIONS
|
(In thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended October 31,
|
|
For the Six Months
Ended October 31,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
(Unaudited)
|
Net
sales
|
|
$
57,931
|
|
$
54,436
|
|
$
101,376
|
|
$
98,112
|
Cost of
sales
|
|
31,441
|
|
28,474
|
|
55,167
|
|
53,111
|
Gross profit
|
|
26,490
|
|
25,962
|
|
46,209
|
|
45,001
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Research and
development
|
|
1,675
|
|
1,557
|
|
3,274
|
|
3,313
|
Selling, marketing, and
distribution
|
|
15,414
|
|
13,924
|
|
27,468
|
|
25,704
|
General and
administrative
|
|
9,423
|
|
10,615
|
|
19,573
|
|
21,679
|
Total operating
expenses
|
|
26,512
|
|
26,096
|
|
50,315
|
|
50,696
|
Operating
loss
|
|
(22)
|
|
(134)
|
|
(4,106)
|
|
(5,695)
|
Other income,
net:
|
|
|
|
|
|
|
|
|
Other income,
net
|
|
53
|
|
585
|
|
92
|
|
826
|
Interest
income/(expense), net
|
|
6
|
|
(242)
|
|
(7)
|
|
(428)
|
Total other income,
net
|
|
59
|
|
343
|
|
85
|
|
398
|
Income/(loss) from
operations before income taxes
|
|
37
|
|
209
|
|
(4,021)
|
|
(5,297)
|
Income tax
(benefit)/expense
|
|
(40)
|
|
(161)
|
|
15
|
|
28
|
Net
income/(loss)
|
|
$
77
|
|
$ 370
|
|
$
(4,036)
|
|
$
(5,325)
|
Net income/(loss) per
share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.01
|
|
$ 0.03
|
|
$
(0.31)
|
|
$
(0.40)
|
Diluted
|
|
$
0.01
|
|
$ 0.03
|
|
$
(0.31)
|
|
$
(0.40)
|
Weighted average number
of common shares outstanding:
|
|
|
|
|
|
|
|
|
Basic
|
|
13,010
|
|
13,465
|
|
13,100
|
|
13,454
|
Diluted
|
|
13,256
|
|
13,589
|
|
13,100
|
|
13,454
|
AMERICAN OUTDOOR
BRANDS, INC. AND SUBSIDIARIES
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
|
|
For the Six Months
Ended October 31,
|
|
2023
|
|
2022
|
|
(In
thousands)
|
Cash flows from
operating activities:
|
|
|
|
Net loss
|
$
(4,036)
|
|
$
(5,325)
|
Adjustments to
reconcile net loss to net cash (used in)/provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
7,927
|
|
8,272
|
Loss on
sale/disposition of assets
|
7
|
|
(5)
|
Provision for credit
losses on accounts receivable
|
6
|
|
16
|
Stock-based
compensation expense
|
1,938
|
|
1,835
|
Changes in operating
assets and liabilities:
|
|
|
|
Accounts
receivable
|
(13,607)
|
|
(3,694)
|
Inventories
|
(9,389)
|
|
10,239
|
Accounts
payable
|
6,331
|
|
(4,058)
|
Accrued
liabilities
|
3,530
|
|
1,823
|
Other
|
4,078
|
|
(2,936)
|
Net cash (used
in)/provided by operating activities
|
(3,215)
|
|
6,167
|
Cash flows from
investing activities:
|
|
|
|
Payments to acquire
patents and software
|
(761)
|
|
(2,495)
|
Proceeds from sale of
property and equipment
|
131
|
|
—
|
Payments to acquire
property and equipment
|
(951)
|
|
(816)
|
Net cash used in investing
activities
|
(1,581)
|
|
(3,311)
|
Cash flows from
financing activities:
|
|
|
|
Payments on notes and
loans payable
|
(5,000)
|
|
(5,170)
|
Payments to acquire
treasury stock
|
(3,762)
|
|
(756)
|
Cash paid for debt
issuance costs
|
—
|
|
(88)
|
Proceeds from exercise
of options to acquire common stock,
including employee stock purchase plan
|
339
|
|
287
|
Payment of employee
withholding tax related to restricted stock units
|
(352)
|
|
(295)
|
Net cash used in financing
activities
|
(8,775)
|
|
(6,022)
|
Net decrease in cash
and cash equivalents
|
(13,571)
|
|
(3,166)
|
Cash and cash
equivalents, beginning of period
|
21,950
|
|
19,521
|
Cash and cash
equivalents, end of period
|
$
8,379
|
|
$
16,355
|
Supplemental disclosure
of cash flow information
|
|
|
|
Cash paid
for:
|
|
|
|
Interest
|
$
196
|
|
$
393
|
Income taxes
|
$
(936)
|
|
$
86
|
AMERICAN OUTDOOR
BRANDS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL
MEASURES
(In thousands, except per share data)
(Unaudited)
|
|
|
For the Three Months
Ended October 31,
|
|
For the Six Months
Ended October 31,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
|
|
|
|
|
|
|
|
GAAP gross
profit
|
$
26,490
|
|
$
25,962
|
|
$ 46,209
|
|
$
45,001
|
Facility consolidation
costs
|
—
|
|
158
|
|
—
|
|
158
|
Non-GAAP gross
profit
|
$
26,490
|
|
$
26,120
|
|
$ 46,209
|
|
$
45,159
|
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$
26,512
|
|
$
26,096
|
|
$ 50,315
|
|
$
50,696
|
Amortization of
acquired intangible assets
|
(2,960)
|
|
(3,074)
|
|
(5,921)
|
|
(6,150)
|
Stock
compensation
|
(1,005)
|
|
(1,121)
|
|
(1,938)
|
|
(1,835)
|
Facility consolidation
costs
|
—
|
|
(134)
|
|
—
|
|
(134)
|
Technology
implementation
|
(66)
|
|
(273)
|
|
(359)
|
|
(1,042)
|
Acquisition
costs
|
—
|
|
—
|
|
—
|
|
(47)
|
Stockholder cooperation
agreement costs
|
—
|
|
(167)
|
|
—
|
|
(1,177)
|
Other
|
(204)
|
|
—
|
|
(204)
|
|
—
|
Non-GAAP operating
expenses
|
$
22,277
|
|
$
21,327
|
|
$ 41,893
|
|
$
40,311
|
|
|
|
|
|
|
|
|
GAAP operating
income/(loss)
|
$
(22)
|
|
$
(134)
|
|
$
(4,106)
|
|
$
(5,695)
|
Amortization of
acquired intangible assets
|
2,960
|
|
3,074
|
|
5,921
|
|
6,150
|
Stock
compensation
|
1,005
|
|
1,121
|
|
1,938
|
|
1,835
|
Facility consolidation
costs
|
—
|
|
292
|
|
—
|
|
292
|
Technology
implementation
|
66
|
|
273
|
|
359
|
|
1,042
|
Acquisition
costs
|
—
|
|
—
|
|
—
|
|
47
|
Stockholder cooperation
agreement costs
|
-
|
|
167
|
|
—
|
|
1,177
|
Other
|
204
|
|
—
|
|
204
|
|
—
|
Non-GAAP operating
income
|
$
4,213
|
|
$
4,793
|
|
$
4,316
|
|
$
4,848
|
|
|
|
|
|
|
|
|
GAAP net
income/(loss)
|
$
77
|
|
$
370
|
|
$
(4,036)
|
|
$
(5,325)
|
Amortization of
acquired intangible assets
|
2,960
|
|
3,074
|
|
5,921
|
|
6,150
|
Stock
compensation
|
1,005
|
|
1,121
|
|
1,938
|
|
1,835
|
Facility consolidation
costs
|
—
|
|
292
|
|
—
|
|
292
|
Technology
implementation
|
66
|
|
273
|
|
359
|
|
1,042
|
Acquisition
costs
|
—
|
|
—
|
|
—
|
|
47
|
Stockholder cooperation
agreement costs
|
-
|
|
167
|
|
—
|
|
1,177
|
Other
|
204
|
|
—
|
|
204
|
|
—
|
Income tax
adjustments
|
(1,023)
|
|
(1,342)
|
|
(997)
|
|
(1,178)
|
Non-GAAP net
income
|
$
3,289
|
|
$
3,955
|
|
$
3,389
|
|
$
4,040
|
|
|
|
|
|
|
|
|
GAAP net loss per share
- diluted
|
$
0.01
|
|
$
0.03
|
|
$
(0.31)
|
|
$
(0.40)
|
Amortization of
acquired intangible assets
|
0.22
|
|
0.23
|
|
0.45
|
|
0.46
|
Stock
compensation
|
0.08
|
|
0.08
|
|
0.15
|
|
0.14
|
Facility consolidation
costs
|
—
|
|
0.02
|
|
—
|
|
0.02
|
Technology
implementation
|
—
|
|
0.02
|
|
0.03
|
|
0.08
|
Acquisition
costs
|
—
|
|
—
|
|
—
|
|
—
|
Stockholder cooperation
agreement costs
|
—
|
|
0.01
|
|
—
|
|
0.09
|
Other
|
0.02
|
|
—
|
|
0.02
|
|
—
|
Income tax
adjustments
|
(0.08)
|
|
(0.10)
|
|
(0.08)
|
|
(0.09)
|
Non-GAAP net income per
share - diluted (a)
|
$
0.25
|
|
$
0.29
|
|
$
0.25
|
(a)
|
$
0.30
|
|
|
|
|
|
|
|
|
(a) Non-GAAP net income
per share does not foot due to rounding.
|
|
|
|
|
AMERICAN OUTDOOR
BRANDS, INC. AND SUBSIDIARIES
|
RECONCILIATION OF
GAAP NET INCOME/(LOSS) TO NON-GAAP ADJUSTED EBITDAS
(In thousands)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three Months
Ended October 31,
|
|
For the Six Months
Ended October 31,
|
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
GAAP net
income/(loss)
|
$
|
77
|
|
$
|
370
|
|
$
|
(4,036)
|
|
$
|
(5,325)
|
Interest
expense
|
|
(6)
|
|
|
242
|
|
|
7
|
|
|
428
|
Income tax
expense
|
|
(40)
|
|
|
(161)
|
|
|
15
|
|
|
28
|
Depreciation and
amortization
|
|
3,935
|
|
|
4,110
|
|
|
7,880
|
|
|
8,272
|
Stock
compensation
|
|
1,005
|
|
|
1,121
|
|
|
1,938
|
|
|
1,835
|
Technology
implementation
|
|
66
|
|
|
273
|
|
|
359
|
|
|
1,042
|
Acquisition
costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
47
|
Facility consolidation
costs
|
|
—
|
|
|
292
|
|
|
—
|
|
|
292
|
Stockholder cooperation
agreement costs
|
|
—
|
|
|
167
|
|
|
—
|
|
|
1,177
|
Other
|
|
204
|
|
|
—
|
|
|
204
|
|
|
—
|
Non-GAAP Adjusted
EBITDAS
|
$
|
5,241
|
|
$
|
6,414
|
|
$
|
6,367
|
|
$
|
7,796
|
Contact:
Liz Sharp, VP, Investor
Relations
lsharp@aob.com
(573) 303-4620
View original content to download
multimedia:https://www.prnewswire.com/news-releases/american-outdoor-brands-inc-reports-second-quarter-fiscal-2024-financial-results-302002562.html
SOURCE American Outdoor Brands, Inc.