EVANSVILLE, Ind., Aug. 14, 2018 /PRNewswire/ -- Escalade, Incorporated (NASDAQ: ESCA) -- "Revenue was down as the unseasonably cold spring weather carried well into the second quarter affecting our Outdoor product categories. The product mix pushed margins down and inventories higher. SG&A came in slightly below prior year even with additional costs related to the sale of our interest in Stiga AB.," stated Dave Fetherman, President and Chief Executive Officer of Escalade, Inc. "The timing of the Stiga AB sale was tax efficient and contributed $0.73 to our second quarter financial results, driving our EPS to $0.84 per share. The Company continues to evaluate various uses of our strong balance sheet, which include acquisitions, internal development, repurchase of shares and cash dividends."
Net sales for the second quarter of 2018 were $48.7 million compared to net sales of $53.9 million for the same quarter in 2017.
Gross margin ratio for the second quarter of 2018 decreased to 23.6%, compared to 24.3% for the same period in the prior year. Gross profit for the second quarter of 2018 was $11.5 million compared to gross profit of $13.1 million for the same quarter in 2017.
Selling, general and administrative expenses (SG&A) were $9.1 million for the quarter compared to $9.3 million for the same period in the prior year.
Operating income for the second quarter of 2018 was $2.0 million compared to operating income of $3.3 million for the same period in the prior year.
The Company recognized a $13.0 million gain in other income during the second quarter of 2018 on the sale of our 50% owned equity method investment, Stiga, a Swedish entity.
Net income for the second quarter of 2018 was $12.1 million, or $0.835 diluted earnings per share compared to net income of $2.1 million, or $0.146 diluted earnings per share for the same quarter in 2017.
The Company announced a quarterly dividend of $0.125 per share to be paid to all shareholders of record on September 10, 2018 and disbursed on September 17, 2018.
Escalade is a leading manufacturer and marketer of sporting goods products sold worldwide. To obtain more information on the Company and its products, visit our website at: www.EscaladeInc.com or contact Patrick Griffin, Vice President of Corporate Development & Investor Relations at 812/467-4449.
ABOUT ESCALADE SPORTS
Headquartered in Evansville, IN, Escalade Sports is a global manufacturer and distributor of sports and outdoor recreational equipment. Leaders in their respective categories, Escalade Sports' brands include Bear® Archery and Trophy Ridge® archery accessories; STIGA® and Ping-Pong® table tennis, Accudart® and Unicorn® darting, Onix® pickleball equipment; Triumph Sports™ indoor and outdoor games, Goalrilla™ and Goalsetter® residential in-ground basketball systems, Goaliath® and Silverback® residential in-ground and portable basketball goals; the STEP® fitness products, Lifeline® personal fitness, Woodplay® premium playsets, Vuly™ Trampolines and Cue&Case® specialty billiard accessories. Escalade Sports' products are available at sporting goods dealers and independent retailers nationwide. For more information on Escalade Sports, its brands, instruction manuals, retailers, warranty, replacement parts or customer service, please call 1-888-784-4288 or visit www.escaladesports.com.
FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements relating to present or future trends or factors that are subject to risks and uncertainties. These risks include, but are not limited to, the impact of competitive products and pricing, product demand and market acceptance, new product development, Escalade's ability to achieve its business objectives, especially with respect to its Sporting Goods business on which it has chosen to focus, Escalade's ability to successfully achieve the anticipated results of strategic transactions, including the integration of the operations of acquired assets and businesses and of divestitures or discontinuances of certain operations, assets, brands, and products, the continuation and development of key customer, supplier, licensing and other business relationships, the ability to successfully negotiate the shifting retail environment and changes in consumer buying habits, the financial health of our customers, disruptions or delays in our supply chain, Escalade's ability to control costs, general economic conditions, fluctuation in operating results, changes in foreign currency exchange rates, changes in the securities market, Escalade's ability to obtain financing and to maintain compliance with the terms of such financing, the availability, integration and effective operation of information systems and other technology, and the potential interruption of such systems or technology, risks related to data security of privacy breaches, and other risks detailed from time to time in Escalade's filings with the Securities and Exchange Commission. Escalade's future financial performance could differ materially from the expectations of management contained herein. Escalade undertakes no obligation to release revisions to these forward-looking statements after the date of this report.
Escalade, Incorporated and Subsidiaries |
|||||||
Consolidated Condensed Statements of Operations |
|||||||
(Unaudited, In Thousands Except Per Share Data) |
|||||||
Three Months Ended |
Six Months Ended |
||||||
All Amounts in Thousands Except Per Share Data |
July 14, |
July 15, |
July 14, |
July 15, |
|||
Net sales |
$48,684 |
$53,921 |
$80,833 |
$85,787 |
|||
Costs and Expenses |
|||||||
Cost of products sold |
37,187 |
40,843 |
60,348 |
64,425 |
|||
Selling, administrative and general expenses |
9,121 |
9,257 |
16,071 |
15,187 |
|||
Amortization |
425 |
489 |
748 |
847 |
|||
Operating Income |
1,951 |
3,332 |
3,666 |
5,328 |
|||
Other Income (Expense) |
|||||||
Interest expense |
(166) |
(234) |
(355) |
(401) |
|||
Equity in earnings of affiliates |
133 |
76 |
121 |
24 |
|||
Gain on sale of equity method investment includes |
13,020 |
-- |
13,020 |
-- |
|||
Gain on bargain purchase |
-- |
-- |
-- |
256 |
|||
Other income (expense) |
(76) |
(47) |
(99) |
(43) |
|||
Income Before Income Taxes |
14,862 |
3,127 |
16,353 |
5,164 |
|||
Provision for Income Taxes |
2,791 |
1,031 |
3,066 |
1,680 |
|||
Net Income |
$12,071 |
$ 2,096 |
$13,287 |
$ 3,484 |
|||
Earnings Per Share Data: |
|||||||
Basic earnings per share |
$ 0.837 |
$ 0.146 |
$ 0.922 |
$ 0.243 |
|||
Diluted earnings per share |
$ 0.835 |
$ 0.146 |
$ 0.921 |
$ 0.242 |
|||
Dividends declared |
$ 0.125 |
$ 0.115 |
$ 0.25 |
$ 0.23 |
|||
Consolidated Condensed Balance Sheets |
|||
(Unaudited, In Thousands) |
|||
All Amounts in Thousands Except Share Information |
July 14, 2018 |
December 30, 2017 |
July 15, 2017 |
(Unaudited) |
(Audited) |
(Unaudited) |
|
ASSETS |
|||
Current Assets: |
|||
Cash and cash equivalents |
$ 15,572 |
$ 1,572 |
$ 2,280 |
Receivables, less allowance of $534; $623; and $532; respectively |
30,758 |
39,350 |
32,236 |
Inventories |
41,454 |
35,160 |
37,470 |
Prepaid expenses |
2,834 |
3,414 |
3,043 |
Prepaid income tax |
-- |
764 |
773 |
Other current assets |
21 |
-- |
-- |
TOTAL CURRENT ASSETS |
90,639 |
80,260 |
75,802 |
Property, plant and equipment, net |
12,990 |
14,286 |
13,910 |
Intangible assets, net |
18,943 |
19,691 |
20,423 |
Goodwill |
21,548 |
21,548 |
21,548 |
Investments |
-- |
20,278 |
18,506 |
Other assets |
-- |
42 |
60 |
TOTAL ASSETS |
$144,120 |
$156,105 |
$150,249 |
LIABILITIES AND STOCKHOLDERS' EQUITY |
|||
Current Liabilities: |
|||
Current portion of long-term debt |
$ -- |
$ 1,250 |
$ 1,300 |
Trade accounts payable |
6,874 |
4,295 |
8,047 |
Accrued liabilities |
9,242 |
13,997 |
9,227 |
Income tax payable |
480 |
-- |
-- |
TOTAL CURRENT LIABILITIES |
16,596 |
19,542 |
18,574 |
Other Liabilities: |
|||
Long‑term debt |
-- |
21,871 |
22,386 |
Deferred income tax liability |
2,469 |
2,469 |
5,216 |
Other liabilities |
503 |
553 |
-- |
TOTAL LIABILITIES |
19,568 |
44,435 |
46,176 |
Stockholders' Equity: |
|||
Preferred stock: |
|||
Authorized 1,000,000 shares; no par value, none issued |
|||
Common stock: |
|||
Authorized 30,000,000 shares; no par value, issued and outstanding – |
14,440 |
14,372 |
14,365 |
Retained earnings |
110,112 |
99,908 |
92,368 |
Accumulated other comprehensive loss |
-- |
(2,610) |
(2,660) |
TOTAL STOCKHOLDERS' EQUITY |
124,552 |
111,670 |
104,073 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
$144,120 |
$156,105 |
$150,249 |
SOURCE Escalade, Incorporated
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