Johnson Outdoors (JOUT) Misses Q3 EPS by 55c, Revenues Miss

Johnson Outdoors (NASDAQ: JOUT) reported Q3 EPS of $1.27, $0.55 worse than the analyst estimate of $1.82. Revenue for the quarter came in at $138.4 million versus the consensus estimate of $157.6 million.

THIRD QUARTER RESULTS

Typically the third quarter is the primary selling season for our warm weather outdoor recreation products; however, due to COVID-19, customer inventory and replenishment and consumer sell-through patterns have shifted. Total Company net sales declined 21.5 percent to $138.4 million, versus $176.3 million in the prior year third quarter.

• Strong demand in Fishing throughout May and June was not enough to offset the impact of COVID-19 in April, resulting in a 20 percent decline in sales.
• New product innovation and positive market dynamics in Watercraft drove higher demand, leading to a 17 percent growth in revenue.
• Retail closures and state and national park closures contributed to a 34 percent decline in Camping sales.
• Diving, our most global business and the first to be affected by stay-at-home mandates, posted a 47 percent decline in revenue.

“As expected, the COVID-19 pandemic had a significant impact on the quarter. Strong momentum in Fishing, Watercraft Recreation and Camping in May and June could not offset the pandemic-related impact on operations in April. Stay-at-home mandates hit during the heart of our primary selling season, as many retailers were closed and consumers were restricted to essential-only activities. As those mandates eased, we began to see high demand and growing participation in Fishing, Camping and Watercraft Recreation, while travel restrictions continue to limit accessibility to Diving,” said Helen Johnson-Leipold, Chairman and Chief Executive Officer. “Going forward, our goal is to continue the positive momentum of our Fishing, Watercraft Recreation and Camping brands through the end of the year by leveraging the increased interest in outdoor activities to the fullest.”

OTHER FINANCIAL INFORMATION The Company reported cash and short-term investments of $181.4 million as of June 26, 2020, versus $149.0 million on June 28, 2019. Depreciation and amortization were $11.5 million compared to $10.4 million in the previous year’s quarter. Capital spending totaled $11.4 million in the first fiscal nine months compared with $12.0 million in the prior year-to-date period. In May 2020, the Company’s Board of Directors approved a quarterly cash dividend to shareholders of record as of July 9, 2020, which was payable on July 23, 2020.

“During the quarter, where appropriate, we reduced expenses; however, at this time, the challenge is keeping pace with demand, with a focus on ending the year strong,” said David W. Johnson, Chief Financial Officer. “Our debt-free balance sheet and our healthy cash position will be beneficial as we continue to work through challenges ahead and make smart investments to strengthen the business and drive value for our shareholders.”

PRODUCT NEWSJohnson Outdoors innovation continues to capture awards and generate excitement at ICAST, the world’s most prestigious fishing show, winning its third “Best of Show” award in the last five years. The new Old Town® Sportsman Autopilot™ won the coveted 2020 “Best of Show” honors, as well as this year’s “Best Boats and Watercraft” award. The Sportsman Autopilot, part of Old Town’s new pioneering line of power, pedal and paddle fishing kayaks, utilizes a GPS-enabled Minn Kota® trolling motor to propel, maneuver, and "anchor" the kayak with its unique Spot-Lock™ Technology.

Johnson Outdoors fishing brands continue to dominate their respective categories at ICAST. The Humminbird® CoastMaster™ won “Best Electronics” honors, resulting in nine ICAST “Best of Electronics” awards in the last ten years. CoastMaster arms saltwater anglers with the very latest information to identify the most productive fishing areas in any U.S. coastal waters and allows anglers to navigate these areas safely and with confidence. The Minn Kota® Raptor™ Shallow Water Anchor grabbed “Best Boating Accessory” honors. Minn Kota’s new Raptor debuts two industry-first technologies: Active Anchoring™, which monitors anchoring force and adjusts to stay pinned to the bottom, and Auto-Bottom Mode™, which automatically detects bottom hardness to determine the right amount of anchoring force.

For earnings history and earnings-related data on Johnson Outdoors (JOUT) click here.

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