EVANSVILLE, Ind., April 14,
2022 /PRNewswire/ -- Escalade, Inc. (NASDAQ:
ESCA, or the "Company"), a leading manufacturer and distributor of
sporting goods and indoor/outdoor recreational equipment, today
announced results for the first quarter 2022.
FIRST QUARTER 2022
HIGHLIGHTS
(As compared to the first quarter 2021)
- Net Sales increased 22.3% to $72.4
million
- Organic growth, excluding the contribution from acquisitions
was 12.2%
- Gross margin declined 165 basis points, while Gross Profit
increased 15.4%
- Operating income increased 26.6% to $9.0
million
- Net income increased to $6.7
million, or $0.49 per diluted
share vs. $0.39 per share for Q1
2021
- Announced $0.15 per share cash
dividend to shareholders of record on May
31, 2022
For the three months ended March 19,
2022, Escalade posted net sales of $72.4 million, net income of $6.7 million and diluted earnings per share of
$0.49.
During the first quarter Escalade completed its acquisition of
Brunswick Billiards®, the largest and oldest provider of billiards
tables, game tables, and game room furniture in the United States. The Escalade Board of
Directors also approved a 7.1% increase in the quarterly dividend
from $0.14 to $0.15.
First quarter 2022 results benefited from strong organic sales
growth across the basketball, archery, pickleball, and indoor game
categories, together with contributions from the Company's
acquisition of Brunswick Billiards®.
Gross margin declined 165 basis points due to continued
challenges related to the global supply chain, raw materials cost
inflation and labor constraints. Tight overhead cost control
led to a 26.6% increase in operating income. A marginally higher
tax rate and 2.7% smaller share base contributed to a 22.3%
increase in net income and 25.4% increase in diluted EPS.
Three Year Quarterly Comparison
|
Three Months
Ended
|
All Amounts in
Thousands
|
March 19,
2022
|
|
March 20,
2021
|
|
March 21,
2020
|
|
|
|
|
|
|
Net sales
|
$72,380
|
|
$59,191
|
|
$37,289
|
Cost of products
sold
|
52,261
|
|
41,757
|
|
27,074
|
Gross Profit
|
20,119
|
|
17,434
|
|
10,215
|
|
27.8%
|
|
29.5%
|
|
27.4%
|
|
|
|
|
|
|
Operating
Income
|
9,023
|
|
7,129
|
|
2,424
|
|
|
|
|
|
|
Net Income
|
6,654
|
|
5,442
|
|
1,951
|
|
|
|
|
|
|
Diluted earnings per
share
|
$0.49
|
|
$0.39
|
|
$0.14
|
|
|
|
|
|
|
Average Shares
Outstanding
|
13,509
|
|
13,880
|
|
14,118
|
"We are very pleased with the results in Q1," stated
Walter P. Glazer, Jr., President and
CEO of Escalade. "Nearly all categories performed very well which
validates the strength of our brand portfolio and consumer
acceptance of our range of products. Our product teams continue to
innovate and bring compelling sporting goods, games, and related
items to market while our sourcing and logistics professionals
navigate the challenging global supply chain. We continue to
'onshore' items we can produce in our domestic manufacturing
facilities and remain focused on the integration of the Brunswick
acquisition, which we expect will be accretive to earnings
beginning in the second half of 2022."
"The first quarter was positively impacted by sales pulled
forward from Q2 and favorable mix. In the near term, we anticipate
continued supply chain pressures, including delays and excess
logistics costs. We are also carefully monitoring point of sale
data along with consumer behavior and sentiment, given rising
interest rates, inflation, and geopolitical uncertainty," continued
Glazer. "We have seen a slowdown in demand for fitness products
following unsustainable growth over the past two years. Longer
term, we believe consumers will continue to value the positive
experiences and memories created with the fun, healthy activities
they can enjoy with the Escalade lifestyle," concluded Glazer.
Net sales for the first quarter of 2022 were $72.4 million compared to net sales of
$59.2 million for the same quarter in
2021, an increase of $13.2 million or
22.3%.
Gross margin for the first quarter of 2022 was 27.8%, compared
to 29.5% for the same period in the prior year. Gross profit for
the first quarter of 2022 was $20.1
million compared to gross profit of $17.4 million for the same quarter in 2021.
Selling, general and administrative expenses (SG&A) were
$10.5 million for the quarter
compared to $9.9 million for the same
period in the prior year, an increase of $0.6 million or 6.6%. SG&A, as a percent of
sales, for the first quarter of 2022 decreased to 14.5% from 16.7%
reported for the same period prior year.
Operating income for the first quarter of 2022 was $9.0 million compared to operating income of
$7.1 million for the same period in
the prior year.
Net income for the first quarter of 2022 was $6.7 million, or $0.49 diluted earnings per share compared to net
income of $5.4 million, or
$0.39 diluted earnings per share for
the same quarter in 2021.
The Company announced a quarterly dividend of $0.15 per share to be paid to all shareholders of
record on May 31, 2022 and disbursed
on June 7, 2022.
CONFERENCE CALL
A conference call will be held Thursday,
April 14, 2022, at 11:00 a.m.
ET to review the Company's financial results, discuss recent
events and conduct a question-and-answer session.
A webcast of the conference call and accompanying presentation
materials will be available in the Investor Relations section of
Escalade's website at www.escaladeinc.com. To listen to a
live broadcast, go to the site at least 15 minutes prior to the
scheduled start time in order to register, download, and install
any necessary audio software.
To participate in the live teleconference:
Domestic
Live:
|
877-407-0792
|
International
Live:
|
201-689-8263
|
To listen to a replay of the teleconference, which subsequently
will be available through April 28,
2022:
Domestic
Replay:
|
844-512-2921
|
International
Replay:
|
412-317-6671
|
Conference
ID:
|
13728194
|
ABOUT ESCALADE, INC
Founded in 1922, and headquartered in Evansville, Indiana, Escalade designs,
manufactures, and sells sporting goods, fitness, and indoor/outdoor
recreation equipment. Our mission is to connect family and
friends creating lasting memories. Leaders in our respective
categories, Escalade's brands include Brunswick Billiards®; STIGA®
table tennis; Accudart®; RAVE Sports® water recreation; Victory
Tailgate® custom games; Onix® pickleball; Goalrilla™ basketball;
Lifeline® fitness; Woodplay® playsets; and Bear® Archery.
Escalade's products are available online and at leading retailers
nationwide. For more information about Escalade's many brands,
history, financials, and governance please visit
www.escaladeinc.com.
INVESTOR RELATIONS
CONTACT
Patrick Griffin
Vice President - Corporate Development & Investor Relations
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:
specific and overall impacts of the COVID-19 global pandemic on
Escalade's financial condition and results of operations; 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; Escalade's
ability to develop and implement our own direct to consumer
e-commerce distribution channel; Escalade's 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 business operations, including without limitation
disruptions or delays in our supply chain, arising from political
unrest, war, labor strikes, natural disasters, public health crises
such as the coronavirus pandemic, and other events and
circumstances beyond our control; Escalade's ability to control
costs; Escalade's ability to successfully implement actions to
lessen the potential impacts of tariffs and other trade
restrictions applicable to our products and raw materials,
including impacts on the costs of producing our goods, importing
products and materials into our markets for sale, and on the
pricing of our products; general economic conditions; fluctuation
in operating results; changes in foreign currency exchange rates;
changes in the securities markets; continued listing of the
Company's common stock on the NASDAQ Global Market and/or inclusion
in market indices such as the Russell 2000; 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 Statements of
Operations
|
(Unaudited, In
Thousands Except Per Share Data)
|
|
|
|
|
Three Months
Ended
|
All Amounts in
Thousands Except Per Share Data
|
|
|
|
|
March 19,
2022
|
|
March 20,
2021
|
|
|
|
|
|
|
|
|
Net sales
|
|
|
|
|
$72,380
|
|
$59,191
|
|
|
|
|
|
|
|
|
Costs and
Expenses
|
|
|
|
|
|
|
|
Cost of products sold
|
|
|
|
|
52,261
|
|
41,757
|
Selling, administrative and general expenses
|
|
|
|
|
10,526
|
|
9,876
|
Amortization
|
|
|
|
|
570
|
|
429
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
|
|
|
9,023
|
|
7,129
|
|
|
|
|
|
|
|
|
Other Income
(Expense)
|
|
|
|
|
|
|
|
Interest expense
|
|
|
|
|
(560)
|
|
(234)
|
Other income
|
|
|
|
|
43
|
|
35
|
|
|
|
|
|
|
|
|
Income Before Income
Taxes
|
|
|
|
|
8,506
|
|
6,930
|
|
|
|
|
|
|
|
|
Provision for Income
Taxes
|
|
|
|
|
1,852
|
|
1,488
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
|
|
$6,654
|
|
$5,442
|
|
|
|
|
|
|
|
|
Earnings Per Share
Data:
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
|
|
|
$
0.49
|
|
$
0.39
|
Diluted earnings per share
|
|
|
|
|
$
0.49
|
|
$
0.39
|
|
|
|
|
|
|
|
|
Dividends declared
|
|
|
|
|
$
0.15
|
|
$
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Balance
Sheets
|
(Unaudited, In
Thousands)
|
|
All Amounts in
Thousands Except Share Information
|
March 19,
2022
|
December 25,
2021
|
March 20,
2021
|
|
(Unaudited)
|
(Audited)
|
(Unaudited)
|
ASSETS
|
|
|
|
Current
Assets:
|
|
|
|
Cash and cash equivalents
|
$ 6,392
|
$ 4,374
|
$ 5,879
|
Receivables, less allowance of $566; $457; and $954;
respectively
|
67,301
|
65,991
|
54,475
|
Inventories
|
114,605
|
92,382
|
91,425
|
Prepaid expenses
|
12,716
|
7,569
|
4,044
|
Prepaid income tax
|
--
|
739
|
--
|
TOTAL CURRENT
ASSETS
|
201,014
|
171,055
|
155,823
|
|
|
|
|
Property, plant and
equipment, net
|
28,812
|
24,936
|
18,962
|
Operating lease
right-of-use assets
|
1,896
|
2,210
|
2,147
|
Intangible assets,
net
|
36,208
|
20,778
|
22,216
|
Goodwill
|
38,837
|
32,695
|
32,695
|
Other assets
|
294
|
124
|
117
|
TOTAL ASSETS
|
$307,061
|
$251,798
|
$231,960
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
Liabilities:
|
|
|
|
Current portion of long-term debt
|
$ 7,143
|
$ 7,143
|
$ --
|
Trade accounts payable
|
27,378
|
15,847
|
22,708
|
Accrued liabilities
|
19,875
|
24,385
|
12,194
|
Income tax payable
|
1,087
|
--
|
1,456
|
Current operating lease liabilities
|
604
|
818
|
1,310
|
TOTAL CURRENT
LIABILITIES
|
56,087
|
48,193
|
37,668
|
|
|
|
|
Other
Liabilities:
|
|
|
|
Long‑term debt
|
92,850
|
50,396
|
46,907
|
Deferred income tax liability
|
4,759
|
4,759
|
4,193
|
Operating lease liabilities
|
1,298
|
1,387
|
844
|
Other liabilities
|
448
|
448
|
448
|
TOTAL LIABILITIES
|
155,442
|
105,183
|
90,060
|
|
|
|
|
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 –
13,585,096;
13,493,332; and 13,924,754; shares respectively
|
13,585
|
13,493
|
13,925
|
Retained
earnings
|
138,034
|
133,122
|
127,975
|
TOTAL STOCKHOLDERS'
EQUITY
|
151,619
|
146,615
|
141,900
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY
|
$307,061
|
$251,798
|
$231,960
|
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SOURCE Escalade, Incorporated