Escalade Reports Third Quarter 2016 Results

Escalade Reports Third Quarter 2016 Results

- Third quarter sales of $38.8 million, up 12% from prior year

- Diluted earnings per share of $0.30, up 114% from prior year

- Company declared a quarterly dividend of $0.11 per share

PR Newswire

EVANSVILLE, Ind., Oct. 27, 2016 /PRNewswire/ -- Escalade, Incorporated (NASDAQ: ESCA) announced that net sales for the third quarter of 2016 were $38.8 million, or 12% higher compared to net sales of $34.6 million for the same quarter in 2015. Acquisitions completed in 2015 and 2016 as well as new product offerings introduced into the market during 2016 are the primary drivers for the increase in sales. Continued softness within the archery category partially offset these increases.

Escalade, Inc.

Gross margin ratio for the third quarter of 2016 remained relatively flat at 27% compared to the same period in 2015. 

Selling, general and administrative expenses (SG&A) were $4.6 million for the quarter compared to $6.9 million for the same period in 2015, a decrease of $2.3 million. As a percentage of sales, SG&A for the third quarter of 2016 decreased to 12% from 20% reported for the same period in 2015. SG&A was favorably impacted by the recognition of a gain of approximately $1.9 million on the sale of our Wabash, IN land and building. One-time expenses of $0.4 million unfavorably impacted SG&A during the third quarter of 2016. SG&A, excluding the gain recognized on the Wabash, IN sale and one-time expenses incurred during the quarter, decreased $0.8 million during the third quarter of 2016 compared to the same period in 2015.

Other income for the third quarter of 2016 decreased due to operating results of the Company's 50% ownership in STIGA, a Swedish entity.

Net income for the third quarter of 2016 was $4.2 million, or $0.30 diluted earnings per share compared to net income of $2.0 million or $0.14 diluted earnings per share for the same quarter in 2015.

The Company announced a quarterly dividend of $0.11 per share would be paid to all shareholders of record on December 12, 2016 and disbursed on December 19, 2016.

"Our growth strategy through acquisitions and internally developed product continues to work, as we showed revenue growth of over 12% in the quarter," stated Dave Fetherman, President and Chief Operating Officer of Escalade, Inc. "We also did a great job of managing expenses, resulting in a reduction of over $0.8 million of SG&A within the quarter. Excluding the gain recognized on the Wabash, IN sale and one-time expenses incurred during the quarter, income before taxes would have been $4.2 million for the quarter, an increase of $1.3 million, or 45% compared to prior year. We are committed to growing our operating income, despite challenging market conditions."

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 812/467-1358.

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 of non-core assets and businesses, the continuation and development of key customer and supplier relationships, 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 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


Nine Months Ended

All Amounts in Thousands Except Per Share Data

October 1, 2016


October 3, 2015


October 1, 2016


October 3, 2015









Net sales

$38,793


$34,584


$121,824


$111,798









Costs and Expenses








Cost of products sold

28,505


25,156


87,793


78,336

Selling, administrative and general expenses

4,583


6,905


21,256


21,018

Amortization

376


650


1,963


2,127









Operating Income

5,329


1,873


10,812


10,317









Other Income (Expense)








Interest expense

(211)


(108)


(631)


(340)

Equity in earnings of affiliates

573


1,069


749


2,080

Other income

35


39


168


276









Income Before Income Taxes

5,726


2,873


11,098


12,333









Provision for Income Taxes

1,483


845


3,068


3,586









Net Income

$ 4,243


$ 2,028


$ 8,030


$ 8,747









Earnings Per Share Data:








Basic earnings per share

$  0.30


$  0.14


$  0.56


$  0.62

Diluted earnings per share

$  0.30


$  0.14


$  0.56


$  0.61









Dividends declared

$  0.11


$  0.11


$  0.33


$  0.32









 

 

 

Consolidated Condensed Balance Sheets


All Amounts in Thousands Except Share Information

October 1,

2016

December 26,

 2015

October 3,

2015


(Unaudited)

(Audited)

(Unaudited)

ASSETS




Current Assets:




Cash and cash equivalents

$  4,306

$   1,982

$     2,701

Receivables, less allowance of $554; $1,086; and $885; respectively

37,034

38,984

31,407

Inventories

42,936

25,862

40,337

Prepaid expenses

2,492

2,534

2,134

Deferred income tax benefit

1,553

1,543

949

Prepaid income tax

952

1,910

1,699

Other current assets

395

--

--

TOTAL CURRENT ASSETS

89,668

72,815

79,227





Property, plant and equipment, net

13,665

14,363

13,848

Intangible assets, net

21,221

16,868

17,517

Goodwill

21,456

20,047

20,142

Investments

19,268

19,644

18,799

Other assets

--

--

5

TOTAL ASSETS

$165,278

$143,737

$149,538





LIABILITIES AND STOCKHOLDERS' EQUITY




Current Liabilities:




Notes payable

$ 30,686

$ 19,776

$ 27,963

Current portion of long-term debt

1,405

1,810

1,810

Trade accounts payable

9,726

2,547

6,630

Accrued liabilities

10,342

14,174

12,430

TOTAL CURRENT LIABILITIES

52,159

38,307

48,833





Other Liabilities:




Long‑term debt

5,313

1,750

1,750

Deferred income tax liability

7,166

7,200

5,031

                TOTAL LIABILITIES

64,638

47,257

 

55,614

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 – 14,301,959; 14,179,844; and 14,125,935; shares respectively

 

 

14,302

 

 

14,180

 

 

14,126

Retained earnings

89,582

85,478

83,064

Accumulated other comprehensive loss

(3,244)

(3,178)

(3,266)

TOTAL STOCKHOLDERS' EQUITY

100,640

96,480

93,924

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$165,278

$143,737

$149,538

 

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SOURCE Escalade, Incorporated

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