UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 3, 2010
Johnson Outdoors
(Exact name of registrant as specified in its charter)
| Wisconsin | 0-16255 | 39-1536083 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
555 Main Street, Racine, Wisconsin 53403
(Address of principal executive offices, including zip code)
(262) 631-6600
(Registrant's telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
| Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | ||
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |
Item 2.02. Results of Operations and Financial Condition.
On December 3, 2010, Johnson Outdoors Inc. (the "Company") issued a press release announcing results for the year ended October 1, 2010 (the "Press Release"). A copy of the Press Release is being furnished as Exhibit 99.1 to this Report.,
The information in this Form 8-K, including Exhibit 99.1, is being furnished and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liability of that Section, nor shall such information be deemed to be incorporated by reference in any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as otherwise stated in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. The following exhibit is being furnished herewith:
99.1 Press Release Dated December 3, 2010.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Johnson Outdoors |
||
| Date: December 3, 2010 |
By: | /s/ DAVID W. JOHNSON David W. Johnson Vice President and Chief Financial Officer |
JOHNSON OUTDOORS INC.
Exhibit Index to Current Report on Form 8-K
Exhibit
Number
99.1 Press Release Dated December 3, 2010.
EXHIBIT 99.1
Johnson Outdoors Announces Full Year and Fourth Quarter Fiscal 2010 Results
RACINE, Wis., Dec. 3, 2010 (GLOBE NEWSWIRE) -- Johnson Outdoors Inc. (Nasdaq:JOUT), a leading global outdoor recreation company, today announced increased revenues and earnings for fiscal 2010. Operating profit rose substantially as the Company benefited from company-wide sustained cost reduction initiatives implemented over the past 18 months. Net income advanced to $6.5 million or $0.68 per diluted share in the current fiscal year compared to a net loss of $9.7 million or ($1.06) per diluted share in the prior fiscal year.
"We have transformed Johnson Outdoors, taking aggressive, strategic action to enhance competitiveness and profitability now and in the future. We streamlined operations, simplified processes and kept working capital within target levels while investing strategically in innovative new products and programs to strengthen our market-leading positions. As a result, this year's revenue growth outpaced our markets as we gained share and outperformed the competition. Importantly, significant improvement in operating efficiency enabled us to grow profits faster than sales, a key objective of our strategic plan. Continued industry recovery and focused, disciplined execution of our strategic plan are key to realizing ongoing marketplace success and sustained profitable growth in the year ahead," said Helen Johnson-Leipold, Chairman and Chief Executive Officer.
YEAR-TO-DATE RESULTS
Total net sales grew 7 percent to $382.4 million in fiscal 2010 versus $356.5 million in fiscal 2009. On a constant currency basis, net sales grew 6 percent. Key contributing factors in the year-over-year increase were:
- Initial recovery of key outdoor recreational markets.
- Double-digit growth in Minn Kota® and Humminbird® brands in all channels and markets.
- Double-digit growth in Eureka!® across consumer and military segments.
- Increased revenues in Diving, which nearly offset declines in Watercraft sales.
- Successful new products in all businesses which generated more than a third of total Company revenues.
Total Company operating profit grew significantly to $14.6 million for fiscal 2010 compared to operating profit of $0.3 million in fiscal 2009. Primary drivers behind the year-over-year comparison were:
- Improved cost absorption as a result of higher sales.
- Nonrecurring items, including restructuring costs of $7.5 million in the prior fiscal year versus $2.0 million in the current fiscal year.
- Ongoing cost savings of $10.7 million, including more than $5.0 million in savings related to Watercraft consolidation, which were in addition to sustained cost reductions realized in fiscal 2009.
- Discretionary bonus and retirement contributions in the current year versus no related expenses in the prior fiscal year.
Net income for the year was $6.5 million or $0.68 per diluted share, versus a net loss of $9.7 million, or ($1.06) per diluted share, in the prior year. The Company's interest expense was reduced by about half due primarily to new debt agreements secured last fall. On November 18, 2010 the Company announced those agreements had been amended and are expected to reduce fiscal 2011 borrowing costs by 15 percent below fiscal 2010 levels.
FOURTH QUARTER RESULTS
Due to the seasonality of the warm-weather outdoor recreational products industry, the Company's fourth quarter results historically reflect an industry-wide slowing of sales and production. Total Company net sales continued a year-long positive upward trend to increase 15 percent compared to the prior year quarter. Key factors behind the results were:
- Double-digit increases in Marine Electronics and Outdoor Equipment sales.
- Positive response across the specialty channel to new Watercraft products and programs.
- Unfavorable currency translation of 2.6 percent impacted Diving sales.
Total Company operating loss declined 70 percent to ($3.3) million for the fourth fiscal quarter from an operating loss of ($10.9) million in the prior year quarter. Key factors contributing to the comparison were:
- Higher sales in all businesses.
- Gross margin improvement in all businesses yielding a 7.2 point gain in total Company margins.
- Discretionary bonus, profit sharing and retirement contributions added $2.4 million in operating expense versus no related expenses in the prior year quarter.
The Company reported a 60 percent decline in its quarterly net loss of $5.8 million, or ($0.62) per diluted share, during the fourth fiscal quarter, compared to a net loss from continuing operations of $14.2 million, or ($1.55) per diluted share, in the same quarter last year. Interest expense for the quarter was 60 percent below the prior year period. Increased tax expense was largely due to a deferred tax asset valuation allowance in Italy.
OTHER FINANCIAL INFORMATION
The Company's debt to total capitalization stood at 16 percent at the end of the year versus 21 percent at October 2, 2009. Cash, net of debt, was $9.5 million at year-end versus debt, net of cash, of $3.7 million at October 2, 2009. Depreciation and amortization was $10.0 million year-to-date compared with $12.9 million in the prior year. Capital spending totaled $10.0 million in 2010 compared with last year's $8.3 million.
"The strength of our balance sheet is reflected in our having ended fiscal 2010 with debt at an all-time low and a $19 million dollar improvement in cash flow year-over-year. Looking ahead, we will continue to carefully manage inventories to keep working capital in check while helping to ensure our ability to meet marketplace demand," said David W. Johnson, Vice President and Chief Financial Officer.
WEBCAST
The Company will host a conference call and audio web cast at 11:00 a.m. Eastern Time on Friday December 3, 2010. A live listen-only web cast of the conference call may be accessed at Johnson Outdoors' home page. A replay of the call will be available for 30 days on the Internet.
ABOUT JOHNSON OUTDOORS INC.
JOHNSON OUTDOORS is a leading global outdoor recreation company that turns ideas into adventure with innovative, top-quality products. The company designs, manufactures and markets a portfolio of winning, consumer-preferred brands across four categories: Watercraft, Marine Electronics, Diving and Outdoor Equipment. Johnson Outdoors' familiar brands include, among others: Old Town® canoes and kayaks; Ocean Kayak™ and Necky® kayaks; Carlisle paddles; Extrasport® personal flotation devices; Minn Kota® motors; Cannon® downriggers; Humminbird® fishfinders; Geonav®marine electronics; SCUBAPRO® and SUBGEAR® dive equipment; Silva® compasses; Tech4O® digital instruments; and Eureka!® tents.
Visit Johnson Outdoors at http://www.johnsonoutdoors.com
SAFE HARBOR STATEMENT
Certain matters discussed in this press release are "forward-looking statements," intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical fact are considered forward-looking statements. These statements may be identified by the use of forward-looking words or phrases such as "anticipate,'' "believe,'' "could,'' "expect,'' "intend,'' "may,'' "planned,'' "potential,'' "should,'' "will,'' "would'' or the negative of those terms or other words of similar meaning.Such forward-looking statements are subject to certain risks and uncertainties, which could cause actual results or outcomes to differ materially from those currently anticipated. Factors that could affect actual results or outcomes include changes in consumer spending patterns; the Company's success in implementing its strategic plan, including its focus on innovation; actions of and disputes with third parties, including comp anies that compete with the Company; the Company's success in managing inventory and its continuing efforts to implement sustainable cost-cutting and sales growth initiatives; the risk that the Company's lenders may be unwilling to provide a waiver or amendment if the Company were to violate financial covenants and the cost to the Company of obtaining any waiver or amendment that the lenders would be willing to provide; risk of future write-downs of goodwill or other intangible assets; ability of the Company's customers to meet payment obligations; movements in foreign currencies or interest rates; the Company's success in its on-going cost-structure reduction efforts; the success of suppliers and customers; the ability of the Company to deploy its capital successfully; adverse weather conditions; and other risks and uncertainties identified in the Company's filings with the Securities and Exchange Commission. Shareholders, potential investors and other readers are urged to consider these factors in ev aluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included herein are only made as of the date of this press release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
FINANCIAL TABLES FOLLOW
| JOHNSON OUTDOORS INC. | ||||
| (thousands, except per share amounts) | ||||
|
THREE MONTHS ENDED |
YEAR ENDED |
|||
| Operating Results |
October 1 2010 |
October 2 2009 |
October 1 2010 |
October 2 2009 |
| Net sales | $ 75,121 | $ 65,287 | $ 382,432 | $ 356,523 |
| Cost of sales | 44,827 | 43,674 | 228,909 | 223,741 |
| Gross profit | 30,294 | 21,613 | 153,523 | 132,782 |
| Operating expenses | 33,592 | 32,496 | 138,969 | 132,510 |
| Operating (loss) profit | (3,298) | (10,883) | 14,554 | 272 |
| Interest expense, net | 1,027 | 2,553 | 4,995 | 9,756 |
| Other expense, net | 273 | 392 | 367 | 594 |
| (Loss) income before income taxes | (4,598) | (13,828) | 9,192 | (10,078) |
| Income tax expense (benefit) | 1,242 | 398 | 2,653 | (407) |
| Net (loss) income | (5,840) | (14,226) | 6,539 | (9,671) |
| Less: undistributed earnings reallocated to non-vested stock | -- | -- | 201 | -- |
| Diluted earnings | $ (5,840) | $ (14,226) | $ 6,338 | $ (9,671) |
| Diluted average common shares outstanding | 9,409 | 9,191 | 9,267 | 9,165 |
| Net (loss) income per common share - Diluted | $ (0.62) | $ (1.55) | $ 0.68 | $ (1.06) |
| Segment Results | ||||
| Net sales: | ||||
| Marine electronics | $ 28,337 | $ 22,091 | $ 185,494 | $ 165,343 |
| Outdoor equipment | 10,612 | 8,830 | 48,690 | 41,387 |
| Watercraft | 12,927 | 11,201 | 64,001 | 69,422 |
| Diving | 23,393 | 23,277 | 85,076 | 80,835 |
| Other/eliminations | (148) | (112) | (829) | (464) |
| Total | $ 75,121 | $ 65,287 | $ 382,432 | $ 356,523 |
| Operating (loss) profit: | ||||
| Marine electronics | $ (2,443) | $ (3,670) | $ 13,938 | $ 9,265 |
| Outdoor equipment | 726 | 101 | 5,881 | 3,360 |
| Watercraft | (37) | (5,864) | 1,826 | (6,149) |
| Diving | 1,009 | 96 | 3,030 | 1,620 |
| Other/eliminations | (2,553) | (1,546) | (10,121) | (7,824) |
| Total | $ (3,298) | $ (10,883) | $ 14,554 | $ 272 |
| Balance Sheet Information (End of Period) | ||||
| Cash and cash equivalents | $ 33,316 | $ 27,895 | ||
| Accounts receivable, net | 46,928 | 43,459 | ||
| Inventories, net | 72,095 | 61,085 | ||
| Total current assets | 160,128 | 142,355 | ||
| Total assets | 226,756 | 210,282 | ||
| Short-term debt | 8,871 | 15,474 | ||
| Total current liabilities | 67,015 | 60,841 | ||
| Long-term debt | 14,939 | 16,089 | ||
| Shareholders' equity | 126,369 | 115,825 | ||
CONTACT: Johnson Outdoors Inc.
David Johnson, VP & Chief Financial Officer
Cynthia Georgeson, VP - Worldwide Communication
262-631-6600