SPRINGFIELD, Mass.,
Dec. 7, 2017 /PRNewswire/ --
American Outdoor Brands Corporation (NASDAQ Global Select:
AOBC), one of the world's leading providers of firearms and quality
products for the shooting, hunting, and rugged outdoor enthusiast,
today announced financial results for the second quarter fiscal
2018, ended October 31, 2017.
Second Quarter Fiscal 2018 Financial Highlights
- Quarterly net sales were $148.4
million, in-line with the company's guidance range, compared
with $233.5 million for the second
quarter last year, a decrease of 36.4%.
- Gross margin for the quarter was 34.2% compared with 41.8% for
the second quarter last year.
- Quarterly GAAP net income was $3.2
million, or $0.06 per diluted
share, compared with net income of $32.5
million, or $0.57 per diluted
share, for the comparable quarter last year. Second quarter 2018
and 2017 GAAP net income per diluted share include expenses of
$2.8 million and $3.0 million, respectively, for amortization, net
of tax, related to acquisitions.
- Quarterly Non-GAAP net income was $6.3
million, or $0.11 per diluted
share, compared with $39.1 million,
or $0.68 per diluted share, for the
comparable quarter last year. GAAP to non-GAAP adjustments to net
income exclude a number of acquisition-related costs, including
amortization, fair value inventory step-up and backlog expense,
one-time transition costs, and discontinued operations, as well as
the associated tax effect on non-GAAP adjustments. For a detailed
reconciliation, see the schedules that follow in this release.
- Quarterly non-GAAP Adjusted EBITDAS was $23.1 million, or 15.5% of net sales, compared
with $72.4 million, or 31.0% of net
sales, for the comparable quarter last year.
- During the second quarter, the company completed the purchase
of substantially all of the assets of Gemini Technologies,
Incorporated ("Gemtech"), a provider of high quality suppressors
and accessories for the consumer, law enforcement, and military
markets, for $10.9 million. The
company also completed the purchase of substantially all of the
assets of Fish Tales, LLC, a provider of premium sportsman knives
and tools for fishing and hunting, including the knife brand, Bubba
Blade™, for approximately $12.1
million.
James Debney, American Outdoor
Brands Corporation President and Chief Executive Officer,
commented, "Our results for the second quarter were within our
guidance range despite challenging market conditions. Lower
shipments in our Firearms business reflected a significant
reduction in wholesaler and retailer orders versus the prior year,
and were partially offset by higher revenue in our Outdoor Products
& Accessories business. Total revenue for the quarter
faced a challenging comparison to last year, when we believe strong
consumer demand was driven by personal safety concerns and
pre-election fears of increased firearm legislation."
"In Firearms, shipments of our new M&P branded polymer
products in full-size, compact, and concealed carry models helped
to offset lower orders in other product categories. While we
were pleased that our firearm inventory at distributors declined
slightly during the quarter, we believe that orders were negatively
impacted by heightened channel inventory from multiple
manufacturers at retail. As expected, our internal inventories
peaked during the quarter, as we prepared for a number of new
firearm product launches. Since then, we have reduced our
internal production output levels and our outsourced capacity to
help lower inventories and better balance production to demand. For
the second half of fiscal 2018, our focus remains on ensuring that
our internal manufacturing resources are aligned with demand.
In addition, we intend to introduce several exciting new products,
and execute on long-term organic growth initiatives that support
our vision of being the leading provider of quality products for
the shooting, hunting, and rugged outdoor enthusiast," concluded
Debney.
Jeffrey D. Buchanan, Executive Vice President, Chief
Financial Officer, and Chief Administrative Officer, commented, "We
ended the quarter with cash of $68.2
million and net debt of approximately $223 million. While cash flow for our second
quarter was flat, as expected, we are forecasting positive cash
flow for the balance of our fiscal year, as we lower our internal
inventory levels in conjunction with the upcoming holiday buying
season, new product launches, and winter distributor buying shows
which take place during our fourth fiscal quarter."
Financial Outlook
AMERICAN OUTDOOR
BRANDS CORPORATION
|
NET SALES AND
EARNINGS PER SHARE GUIDANCE, INCLUDING GAAP TO NON-GAAP
RECONCILIATION
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Range for the
Three Months Ending January 31, 2018
|
|
Range for the Year
Ending April 30, 2018
|
|
Net sales (in
thousands)
|
$ 170,000
|
|
$ 180,000
|
|
$ 650,000
|
|
$ 675,000
|
|
|
|
|
|
|
|
|
|
|
GAAP income per share
- diluted
|
$
0.01
|
|
$
0.04
|
|
$
0.33
|
|
$
0.43
|
|
Amortization of
acquired intangible assets
|
0.10
|
|
0.10
|
|
0.38
|
|
0.38
|
|
Acquisition-related
costs
|
—
|
|
—
|
|
0.01
|
|
0.01
|
|
Transition
costs
|
—
|
|
—
|
|
0.01
|
|
0.01
|
|
Change in contingent
consideration
|
—
|
|
—
|
|
(0.02)
|
|
(0.02)
|
|
Tax effect of
non-GAAP adjustments
|
(0.04)
|
|
(0.04)
|
|
(0.14)
|
|
(0.14)
|
|
Non-GAAP income per
share - diluted
|
$
0.07
|
|
$
0.10
|
|
$
0.57
|
|
$
0.67
|
|
Conference Call and Webcast
The company will host a conference call and webcast today,
December 7, 2017, to discuss its
second quarter fiscal 2018 financial and operational results.
Speakers on the conference call will include James Debney, President and Chief Executive
Officer, and Jeffrey D. Buchanan,
Executive Vice President, Chief Financial Officer, and Chief
Administrative Officer. The conference call may include
forward-looking statements. 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 (844) 309-6568 and reference conference code
2598827. No RSVP is necessary. The conference call
audio webcast can also be accessed live and for replay on the
company's website at www.aob.com, under the Investor Relations
section. The company will maintain an audio replay of this
conference call on its website for a period of time after the call.
No other audio replay will be available.
Reconciliation of U.S. GAAP to Non-GAAP Financial
Measures
In this press release, certain non-GAAP financial measures,
including "non-GAAP net income," "Adjusted EBITDAS," and "free cash
flow" are presented. From time-to-time, we consider and use these
supplemental measures of operating performance in order to provide
the reader with an improved understanding of underlying performance
trends. We believe it is useful for our company and the
reader to review, as applicable, both (1) GAAP measures that
include (i) amortization of acquired intangible assets, (ii)
transition costs, (iii) discontinued operations, (iv) changes in
contingent consideration liabilities, (v) acquisition-related
costs, (vi) inventory step-up and backlog expense, (vii) tax effect
of non-GAAP adjustments, (viii) net cash (used in)/provided by
operating activities, (ix) net cash used in investing activities,
(x) receipts from note receivable, (xi) interest expense (xii)
income tax (benefit)/expense, (xiii) depreciation and amortization,
and (xiv) stock-based compensation expense; and (2) the non-GAAP
measures that exclude such information. We present these non-GAAP
measures because we consider them an important supplemental measure
of our performance. Our definition of these adjusted financial
measures may differ from similarly named measures used by others.
We believe 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 our GAAP
measures. The principal limitations of these measures are
that they do not reflect our actual expenses and may thus have the
effect of inflating our financial measures on a GAAP basis.
About American Outdoor Brands Corporation
American Outdoor Brands Corporation (NASDAQ Global Select: AOBC) is
a provider of quality products for shooting, hunting, and rugged
outdoor enthusiasts in the global consumer and professional
markets. The Company reports two segments: Firearms and Outdoor
Products & Accessories. Firearms manufactures handgun and
long gun products sold under the Smith & Wesson®, M&P®,
Thompson/Center Arms™, and Gemtech® brands as well as provides
forging, machining, and precision plastic injection molding
services. Outdoor Products & Accessories provides shooting,
hunting, and outdoor accessories, including reloading, gunsmithing,
and gun cleaning supplies, tree saws, vault accessories, knives,
laser sighting systems, tactical lighting products, and survival
and camping equipment. Brands in Outdoor Products & Accessories
include Smith & Wesson®, M&P®, Thompson/Center Arms™,
Crimson Trace®, Caldwell® Shooting Supplies, Wheeler® Engineering,
Tipton® Gun Cleaning Supplies, Frankford Arsenal® Reloading Tools,
Lockdown® Vault Accessories, Hooyman® Premium Tree Saws, BOG POD®,
Golden Rod® Moisture Control, Schrade®, Old Timer®, Uncle Henry®,
Imperial®, Bubba Blade®, and UST™. For more information on
American Outdoor Brands Corporation, call (844) 363-5386 or log on
to 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. Such forward-looking statements include, among
others, our strategy to continue growing and balancing our business
across the shooting, hunting, and rugged outdoor enthusiast market;
our belief that total revenue for the quarter faced a challenging
comparison to last year's heightened levels of firearms demand
which we believe was driven by concerns for personal safety and the
potential for increased firearm legislation; our belief that lower
shipments in our Firearms business were due to a softening in
wholesaler and retailer orders compared to last year; our belief
that heightened channel inventory from multiple manufacturers at
retail locations contributed to lower orders in the quarter; our
belief that we are focused on executing our long-term strategic
initiatives, which support our vision of being the leading provider
of quality products for the shooting, hunting and rugged outdoor
enthusiast; our belief that we will generate positive cash flow for
the balance of our fiscal year; and our expectations for net sales,
GAAP income per diluted share, amortization of acquired intangible
assets, acquisition-related costs, transition costs, change in
contingent consideration, tax effect of non-GAAP adjustments, and
non-GAAP income per diluted share for the third quarter of fiscal
2018 and for fiscal 2018. 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, the demand for our products; the state of
the U.S. economy in general and the firearm industry in particular;
general economic conditions and consumer spending patterns; our
competitive environment; the supply, availability and costs of raw
materials and components; the potential for increased regulation of
firearms and firearm-related products; speculation surrounding
fears of terrorism and crime; our anticipated growth and growth
opportunities; our ability to increase demand for our products in
various markets, including consumer, law enforcement, and military
channels, domestically and internationally; our penetration rates
in new and existing markets; our strategies; our ability to
maintain and enhance brand recognition and reputation; risks
associated with the establishment of our new 630,000 square foot
national distribution center; our ability to introduce new products
including our new M&P branded polymer products in full-size,
compact and concealed carry models; the success of new products;
our ability to expand our markets; our ability to integrate
acquired businesses in a successful manner; the general growth of
our outdoor products and accessories business; the potential for
cancellation of orders from our backlog; and other risks detailed
from time to time in our reports filed with the SEC, including our
Annual Report on Form 10-K for the fiscal year ended April 30, 2017.
Contact: Liz Sharp, VP
Investor Relations
American Outdoor Brands Corporation
(413) 747-6284
lsharp@aob.com
AMERICAN OUTDOOR
BRANDS CORPORATION AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF INCOME
|
(Unaudited)
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Six Months
Ended
|
|
|
|
October 31,
2017
|
|
October 31,
2016
|
|
October 31,
2017
|
|
October 31,
2016
|
|
|
|
(In thousands, except
per share data)
|
Net sales
|
|
$
148,427
|
|
$
233,528
|
|
$
277,448
|
|
$
440,479
|
|
Cost of
sales
|
|
97,628
|
|
135,923
|
|
186,017
|
|
255,305
|
|
Gross
profit
|
|
50,799
|
|
97,605
|
|
91,431
|
|
185,174
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
Research and
development
|
|
2,746
|
|
2,698
|
|
5,532
|
|
4,851
|
|
Selling and
marketing
|
|
15,351
|
|
12,527
|
|
27,069
|
|
21,721
|
|
General and
administrative
|
|
24,713
|
|
30,229
|
|
54,041
|
|
53,926
|
|
Total operating
expenses
|
|
42,810
|
|
45,454
|
|
86,642
|
|
80,498
|
|
Operating
income
|
|
7,989
|
|
52,151
|
|
4,789
|
|
104,676
|
|
Other
(expense)/income, net:
|
|
|
|
|
|
|
|
|
|
Other
(expense)/income, net
|
|
(3)
|
|
(30)
|
|
1,295
|
|
(30)
|
|
Interest expense,
net
|
|
(2,963)
|
|
(2,175)
|
|
(5,354)
|
|
(4,188)
|
|
Total other
(expense)/income, net
|
|
(2,966)
|
|
(2,205)
|
|
(4,059)
|
|
(4,218)
|
|
Income from
operations before income taxes
|
|
5,023
|
|
49,946
|
|
730
|
|
100,458
|
|
Income tax
expense/(benefit)
|
|
1,789
|
|
17,463
|
|
(337)
|
|
32,752
|
|
Net income
|
|
3,234
|
|
32,483
|
|
1,067
|
|
67,706
|
|
Net income per
share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
0.06
|
|
$
0.58
|
|
$
0.02
|
|
$
1.21
|
|
Diluted
|
|
$
0.06
|
|
$
0.57
|
|
$
0.02
|
|
$
1.18
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
54,044
|
|
56,231
|
|
53,975
|
|
56,140
|
|
Diluted
|
|
54,656
|
|
57,136
|
|
54,800
|
|
57,145
|
|
AMERICAN OUTDOOR
BRANDS CORPORATION AND SUBSIDIARIES
|
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
|
(Unaudited)
|
|
|
|
|
As
of
|
|
|
October 31,
2017
|
|
April 30,
2017
|
|
|
(In thousands, except
par value and share data)
|
|
ASSETS
|
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
$
68,171
|
|
$
61,549
|
|
Accounts receivable,
net of allowance for doubtful accounts of $1,301 on October
31, 2017 and $598 on April 30, 2017
|
81,771
|
|
108,444
|
|
Inventories
|
178,946
|
|
131,682
|
|
Prepaid expenses and
other current assets
|
7,630
|
|
6,123
|
|
Income tax
receivable
|
11,280
|
|
10,643
|
|
Total current
assets
|
347,798
|
|
318,441
|
|
Property,
plant, and equipment, net
|
143,774
|
|
149,685
|
|
Intangibles,
net
|
123,419
|
|
141,317
|
|
Goodwill
|
191,098
|
|
169,017
|
|
Other
assets
|
10,174
|
|
9,576
|
|
|
$
816,263
|
|
$
788,036
|
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
$
45,522
|
|
$
53,447
|
|
Accrued
expenses
|
37,312
|
|
51,686
|
|
Accrued payroll and
incentives
|
9,629
|
|
21,174
|
|
Accrued income
taxes
|
230
|
|
726
|
|
Accrued profit
sharing
|
2,605
|
|
13,004
|
|
Accrued
warranty
|
5,170
|
|
4,908
|
|
Current portion of
notes and loans payable
|
81,300
|
|
6,300
|
|
Total current
liabilities
|
181,768
|
|
151,245
|
|
Deferred income
taxes
|
21,334
|
|
25,620
|
|
Notes and loans
payable, net of current portion
|
207,992
|
|
210,657
|
|
Other
non-current liabilities
|
7,738
|
|
7,352
|
|
Total
liabilities
|
418,832
|
|
394,874
|
|
Commitments and
contingencies
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
Preferred stock,
$.001 par value, 20,000,000 shares authorized, no shares
issued or outstanding
|
—
|
|
—
|
|
Common stock,
$.001 par value, 100,000,000 shares authorized,
72,280,952 shares issued and 54,114,090 shares outstanding on
October 31, 2017 and 72,017,288 shares issued and 53,850,426
shares outstanding on April 30, 2017
|
72
|
|
72
|
|
Additional paid-in
capital
|
248,918
|
|
245,865
|
|
Retained
earnings
|
370,231
|
|
369,164
|
|
Accumulated other
comprehensive income
|
585
|
|
436
|
|
Treasury stock, at
cost (18,166,862 shares on October 31, 2017 and April 30,
2017)
|
(222,375)
|
|
(222,375)
|
|
Total stockholders'
equity
|
397,431
|
|
393,162
|
|
|
$
816,263
|
|
$
788,036
|
|
AMERICAN OUTDOOR
BRANDS CORPORATION AND SUBSIDIARIES
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
|
|
For the Six Months
Ended
|
|
October 31,
2017
|
|
October 31,
2016
|
|
(In
thousands)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
1,067
|
|
$
67,706
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
Depreciation and
amortization
|
26,317
|
|
23,772
|
Loss on
sale/disposition of assets
|
34
|
|
104
|
Provision for losses
on accounts receivable
|
354
|
|
308
|
Change in contingent
consideration
|
(1,300)
|
|
—
|
Stock-based
compensation expense
|
4,179
|
|
3,918
|
Changes in operating
assets and liabilities (net effect of acquisitions):
|
|
|
|
Accounts
receivable
|
27,112
|
|
(3,538)
|
Inventories
|
(42,581)
|
|
(14,349)
|
Prepaid expenses and
other current assets
|
(1,362)
|
|
(2,775)
|
Income
taxes
|
(1,133)
|
|
(9,676)
|
Accounts
payable
|
(8,725)
|
|
1,111
|
Accrued payroll and
incentives
|
(11,640)
|
|
(4,728)
|
Accrued profit
sharing
|
(10,399)
|
|
(4,699)
|
Accrued
expenses
|
(13,084)
|
|
4,235
|
Accrued
warranty
|
262
|
|
116
|
Other
assets
|
(362)
|
|
(183)
|
Other non-current
liabilities
|
609
|
|
52
|
Net cash (used
in)/provided by operating activities
|
(30,652)
|
|
61,374
|
Cash flows from
investing activities:
|
|
|
|
Acquisition of
businesses, net of cash acquired
|
(23,016)
|
|
(178,059)
|
Refunds on machinery
and equipment
|
—
|
|
5,083
|
Receipts from note
receivable
|
—
|
|
43
|
Payments to acquire
patents and software
|
(254)
|
|
(425)
|
Proceeds from sale of
property and equipment
|
6
|
|
—
|
Payments to acquire
property and equipment
|
(9,863)
|
|
(23,312)
|
Net cash used in
investing activities
|
(33,127)
|
|
(196,670)
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from loans
and notes payable
|
75,000
|
|
50,000
|
Cash paid for debt
issuance costs
|
—
|
|
(525)
|
Payments on capital
lease obligation
|
(323)
|
|
(298)
|
Payments on notes and
loans payable
|
(3,150)
|
|
(28,150)
|
Proceeds from
Economic Development Incentive Program
|
—
|
|
101
|
Proceeds from
exercise of options to acquire common stock, including employee
stock purchase plan
|
1,058
|
|
948
|
Payment of employee
withholding tax related to restricted stock units
|
(2,184)
|
|
(4,163)
|
Net cash provided by
financing activities
|
70,401
|
|
17,913
|
Net
increase/(decrease) in cash and cash equivalents
|
6,622
|
|
(117,383)
|
Cash and cash
equivalents, beginning of period
|
61,549
|
|
191,279
|
Cash and cash
equivalents, end of period
|
$
68,171
|
|
$
73,896
|
Supplemental
disclosure of cash flow information
|
|
|
|
Cash paid
for:
|
|
|
|
Interest
|
$
4,844
|
|
$
3,802
|
Income
taxes
|
1,257
|
|
42,609
|
RECONCILIATION OF
GAAP FINANCIAL MEASURES TO NON-GAAP FINANCIAL
MEASURES
|
(Dollars in
thousands, except per share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Six Months
Ended
|
|
|
October 31,
2017
|
|
October 31,
2016
|
|
October 31,
2017
|
|
October 31,
2016
|
|
|
$
|
|
% of
Sales
|
|
$
|
|
% of
Sales
|
|
$
|
|
% of
Sales
|
|
$
|
|
% of
Sales
|
|
GAAP gross
profit
|
$ 50,799
|
|
34.2%
|
|
$
97,605
|
|
41.8%
|
|
$ 91,431
|
|
33.0%
|
|
$ 185,174
|
|
42.0%
|
|
Fair value inventory
step-up and backlog expense
|
91
|
|
0.1%
|
|
3,824
|
|
1.6%
|
|
91
|
|
0.0%
|
|
3,824
|
|
0.9%
|
|
Non-GAAP gross
profit
|
$ 50,890
|
|
34.3%
|
|
$ 101,429
|
|
43.4%
|
|
$ 91,522
|
|
33.0%
|
|
$ 188,998
|
|
42.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
expenses
|
$ 42,810
|
|
28.8%
|
|
$
45,454
|
|
19.5%
|
|
$ 86,642
|
|
31.2%
|
|
$
80,498
|
|
18.3%
|
|
Amortization of
acquired intangible assets
|
(4,268)
|
|
-2.9%
|
|
(4,566)
|
|
-2.0%
|
|
(9,953)
|
|
-3.6%
|
|
(7,110)
|
|
-1.6%
|
|
Transition
costs
|
(79)
|
|
-0.1%
|
|
—
|
|
—
|
|
(391)
|
|
-0.1%
|
|
—
|
|
—
|
|
Discontinued
operations
|
—
|
|
—
|
|
(23)
|
|
0.0%
|
|
—
|
|
—
|
|
(44)
|
|
0.0%
|
|
Acquisition-related
costs
|
(259)
|
|
-0.2%
|
|
(1,824)
|
|
-0.8%
|
|
(676)
|
|
-0.2%
|
|
(3,156)
|
|
-0.7%
|
|
Non-GAAP operating
expenses
|
$ 38,204
|
|
25.7%
|
|
$
39,041
|
|
16.7%
|
|
$ 75,622
|
|
27.3%
|
|
$
70,188
|
|
15.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP operating
income
|
$
7,989
|
|
5.4%
|
|
$
52,151
|
|
22.3%
|
|
$
4,789
|
|
1.7%
|
|
$ 104,676
|
|
23.8%
|
|
Fair value inventory
step-up and backlog expense
|
91
|
|
0.1%
|
|
3,824
|
|
1.6%
|
|
91
|
|
0.0%
|
|
3,824
|
|
0.9%
|
|
Amortization of
acquired intangible assets
|
4,268
|
|
2.9%
|
|
4,566
|
|
2.0%
|
|
9,953
|
|
3.6%
|
|
7,110
|
|
1.6%
|
|
Transition
costs
|
79
|
|
0.1%
|
|
—
|
|
—
|
|
391
|
|
0.1%
|
|
—
|
|
—
|
|
Discontinued
operations
|
—
|
|
—
|
|
23
|
|
0.0%
|
|
—
|
|
—
|
|
44
|
|
0.0%
|
|
Acquisition-related
costs
|
259
|
|
0.2%
|
|
1,824
|
|
0.8%
|
|
676
|
|
0.2%
|
|
3,156
|
|
0.7%
|
|
Non-GAAP operating
income
|
$ 12,686
|
|
8.5%
|
|
$
62,388
|
|
26.7%
|
|
$ 15,900
|
|
5.7%
|
|
$ 118,810
|
|
27.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net
income
|
$
3,234
|
|
2.2%
|
|
$
32,483
|
|
13.9%
|
|
$
1,067
|
|
0.4%
|
|
$
67,706
|
|
15.4%
|
|
Fair value inventory
step-up and backlog expense
|
91
|
|
0.1%
|
|
3,824
|
|
1.6%
|
|
91
|
|
0.0%
|
|
3,824
|
|
0.9%
|
|
Amortization of
acquired intangible assets
|
4,268
|
|
2.9%
|
|
4,566
|
|
2.0%
|
|
9,953
|
|
3.6%
|
|
7,110
|
|
1.6%
|
|
Transition
costs
|
79
|
|
0.1%
|
|
—
|
|
—
|
|
391
|
|
0.1%
|
|
—
|
|
—
|
|
Discontinued
operations
|
—
|
|
—
|
|
23
|
|
0.0%
|
|
—
|
|
—
|
|
44
|
|
0.0%
|
|
Acquisition-related
costs
|
259
|
|
0.2%
|
|
1,824
|
|
0.8%
|
|
676
|
|
0.2%
|
|
3,156
|
|
0.7%
|
|
Change in contingent
consideration
|
—
|
|
—
|
|
—
|
|
—
|
|
(1,300)
|
|
-0.5%
|
|
—
|
|
—
|
|
Tax effect of
non-GAAP adjustments
|
(1,672)
|
|
-1.1%
|
|
(3,583)
|
|
-1.5%
|
|
(3,532)
|
|
-1.3%
|
|
(4,611)
|
|
-1.0%
|
|
Non-GAAP net
income
|
$
6,259
|
|
4.2%
|
|
$
39,137
|
|
16.8%
|
|
$
7,346
|
|
2.6%
|
|
$
77,229
|
|
17.5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP net income per
share - diluted
|
$
0.06
|
|
|
|
$
0.57
|
|
|
|
$
0.02
|
|
|
|
$
1.18
|
|
|
|
Fair value inventory
step-up and backlog expense
|
—
|
|
|
|
0.07
|
|
|
|
—
|
|
|
|
0.07
|
|
|
|
Amortization of
acquired intangible assets
|
0.08
|
|
|
|
0.08
|
|
|
|
0.18
|
|
|
|
0.12
|
|
|
|
Transition
costs
|
—
|
|
|
|
—
|
|
|
|
0.01
|
|
|
|
—
|
|
|
|
Discontinued
operations
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
Acquisition-related
costs
|
—
|
|
|
|
0.03
|
|
|
|
0.01
|
|
|
|
0.06
|
|
|
|
Change in contingent
consideration
|
—
|
|
|
|
—
|
|
|
|
(0.02)
|
|
|
|
—
|
|
|
|
Tax effect of
non-GAAP adjustments
|
(0.03)
|
|
|
|
(0.06)
|
|
|
|
(0.06)
|
|
|
|
(0.08)
|
|
|
|
Non-GAAP net income
per share - diluted (a)
|
$
0.11
|
|
|
|
$
0.68
|
(a)
|
|
$
0.13
|
(a)
|
|
$
1.35
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Non-GAAP net
income per share does not foot due to rounding.
|
AMERICAN OUTDOOR
BRANDS CORPORATION AND SUBSIDIARIES
|
RECONCILIATION OF
NET OPERATING CASH FLOW TO FREE CASH FLOW
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Six
Months Ended
|
|
|
October 31,
2017
|
|
October 31,
2016
|
|
October 31,
2017
|
|
October 31,
2016
|
|
Net cash (used
in)/provided by operating activities
|
$
3,840
|
|
$
20,764
|
|
$
(30,652)
|
|
$
61,374
|
|
Net cash used in
investing activities
|
(28,339)
|
|
(185,555)
|
|
(33,127)
|
|
(196,670)
|
|
Acquisition of
businesses, net of cash acquired
|
23,016
|
|
178,059
|
|
23,016
|
|
178,059
|
|
Receipts from note
receivable
|
—
|
|
(22)
|
|
—
|
|
(43)
|
|
Free cash
flow
|
$
(1,483)
|
|
$
13,246
|
|
$
(40,763)
|
|
$
42,720
|
|
AMERICAN OUTDOOR
BRANDS CORPORATION AND SUBSIDIARIES
|
RECONCILIATION OF
GAAP NET INCOME TO NON-GAAP ADJUSTED EBITDAS
|
(in
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
For the Six Months
Ended
|
|
|
October 31,
2017
|
|
October 31,
2016
|
|
October 31,
2017
|
|
October 31,
2016
|
|
|
|
|
|
|
|
|
|
GAAP net
income
|
|
$
3,234
|
|
$
32,483
|
|
$
1,067
|
|
$
67,706
|
Interest
expense
|
|
3,033
|
|
2,313
|
|
5,423
|
|
4,367
|
Income tax
expense/(benefit)
|
|
1,789
|
|
17,463
|
|
(337)
|
|
32,752
|
Depreciation and
amortization
|
|
12,304
|
|
12,384
|
|
25,831
|
|
22,488
|
Stock-based
compensation expense
|
|
2,289
|
|
2,126
|
|
4,179
|
|
3,918
|
Fair value inventory
step-up and backlog expense
|
|
91
|
|
3,824
|
|
91
|
|
3,824
|
Acquisition-related
costs
|
|
259
|
|
1,824
|
|
676
|
|
3,156
|
Discontinued
operations
|
|
—
|
|
23
|
|
—
|
|
44
|
Transition
costs
|
|
79
|
|
—
|
|
391
|
|
—
|
Change in contingent
consideration
|
|
—
|
|
—
|
|
(1,300)
|
|
—
|
Non-GAAP Adjusted
EBITDAS
|
|
$
23,078
|
|
$
72,440
|
|
$
36,021
|
|
$
138,255
|
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SOURCE American Outdoor Brands Corporation