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): November
17, 2006
|
Johnson
Outdoors Inc.
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|
(Exact
name of registrant as specified in its
charter)
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Wisconsin
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0-16255
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39-1536083
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(State
or other jurisdiction
of
incorporation)
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(Commission
File Number)
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(IRS
Employer
Identification
No.)
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555
Main Street, Racine, Wisconsin 53403
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(Address
of principal executive offices, including zip
code)
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(262)
631-6600
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(Registrant's
telephone number, including area
code)
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Not
Applicable
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(Former
name or former address, if changed since last
report)
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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:
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[
]
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425)
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[
]
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
|
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[
]
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR
240.14d-2(b))
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[
]
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR
240.13e-4(c))
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Section
2 - Financial Information
Item
2.02. Results
of Operations and Financial Condition.
On
November 17, 2006, Johnson Outdoors Inc. (the “Company”) issued a press
release announcing results for the fiscal fourth quarter and year ended
September 29, 2006 (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.
Section
9 - Financial Statements and Exhibits
Item
9.01. Financial
Statements and Exhibits.
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(d)
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Exhibits.
The following exhibit is being furnished
herewith:
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99.1
Press
Release Dated November 17, 2006.
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||
2
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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JOHNSON
OUTDOORS INC.
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Date: November
17, 2006
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By: /s/
David W.
Johnson
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David W. Johnson,
Vice President and Chief Financial Officer
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3
JOHNSON
OUTDOORS INC.
Exhibit
Index to Current Report on Form 8-K
Exhibit
Number
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99.1
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Press
Release Dated November 17, 2006.
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4
Exhibit
99.1
FOR
IMMEDIATE RELEASE
At
Johnson Outdoors Inc.
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David
Johnson
VP &
Chief Financial Officer
262-631-6600
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Cynthia
Georgeson
VP
- Worldwide Communication
262-631-6600
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JOHNSON
OUTDOORS INC. ANNOUNCES FISCAL 2006 FOURTH QUARTER AND FULL YEAR
RESULTS
RACINE,
WISCONSIN, November 17, 2006…… Johnson Outdoors Inc. (Nasdaq:
JOUT),
a
leading global outdoor recreation company, today announced increased net sales
and earnings for the 2006 fiscal fourth quarter and full year. Net sales for
the
fourth quarter ended September 29, 2006 were $80.3 million, an increase of
4%
compared to $77.1 million for the prior year quarter. Net income for the quarter
improved to a net loss of $0.9 million ($0.10 per diluted share) versus a net
loss of $3.4 million ($0.39 per diluted share) for the prior year quarter.
For
the full year, the Company reported net sales of $395.8 million compared to
$380.7 million for fiscal 2005, representing 4% growth year-over-year. Net
income for the year was $8.7 million ($0.95 per diluted share), a 23% increase
versus prior year.
FOURTH
QUARTER RESULTS
Fourth
quarter results historically reflect a loss due to the slowing of sales and
production of the Company’s seasonal outdoor recreation products. Sales growth
in the Company’s core consumer brands more than offset anticipated lower
military revenues for the quarter. Key changes included:
|
·
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Watercraft
positive momentum continued as double-digit growth in international
paddle
sport revenues drove sales 4% ahead of last year’s strong fourth quarter
results.
|
|
·
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Marine
Electronics realized a 13% uptick in quarterly net sales due to growth
in
mass and sporting good channels for Minn Kota® and the acquisition of
Cannon® and Bottom Line® brands, completed on October 3, 2005, which added
a combined $2.1 million in net sales to the unit during the quarter.
|
|
·
|
Diving
revenues were 11% ahead of last year driven by solid growth in North
America and improved performance in key international markets.
|
|
·
|
Outdoor
Equipment revenues decreased 16% due entirely to a 57% decline in
military
tent sales. Consumer camping continued to benefit significantly from
specialty market sales this quarter. Commercial tent sales dipped
slightly
below last year due to low inventories resulting from the temporary
halt
of production in the 2006 fiscal third quarter caused by flooding
in the
Company’s tent manufacturing facility in Binghamton, New York.
|
Total
Company operating loss of $0.7 million in the fourth quarter compared favorably
to an operating loss of $4.6 million in the same period last year. Operating
loss improvement was due primarily to a growth in gross margins driven by strong
new product introductions, coupled with effective cost-saving programs and
pricing strategies, which more than off-set higher commodity costs and freight
charges.
The
Company reported a net loss during the seasonally slow fourth quarter of $0.9
million, or $0.10 per diluted share, a significant improvement over the net
loss
of $3.4 million, or $0.39 per diluted share, in the prior year quarter.
FULL
YEAR RESULTS
Total
Company net sales were $395.8 million, a 4% increase over $380.7 million in
the
prior year. Sales growth in the Company’s core consumer brands more than offset
anticipated lower military revenues for the year. Key factors impacting the
year-over-year sales results included:
|
·
|
The
successful integration of Cannon® and Bottom Line® brands into the
Company’s Marine Electronics division, which added $9.8 million to the
division’s net sales, along with double-digit growth in the Humminbird®
brand and increased international sales drove the 13% increase in
Marine
Electronics revenues year-over-year.
|
|
·
|
The
Watercraft division grew 8% year-over-year as a result of a strong
line-up
of new canoes and kayaks which drove double-digit growth in key
international markets and among the division’s top 30 domestic customers
for the second year in a row. The Old Town® Dirigo™ kayak, the Ocean
Kayak™ Prowler series of fishing kayaks and the Necky® Manitou series of
kayaks were major contributors to this year’s revenue growth.
|
|
·
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Diving
sales were down slightly with strong performances in North American
and
Asia markets almost offsetting unfavorable currency translations
and
weakness in European markets.
|
|
·
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Outdoor
Equipment reported a year-over-year decline of 12.5% due to a 33.5%
reduction in military sales versus the prior year which was partially
offset by increased revenues in both Consumer and Commercial segments.
|
2
Operating
profit for the year was $20.6 million compared to $15.5 million in 2005 which
reflected $2.7 million in charges related to a terminated buy-out proposal.
Other key factors driving the year-over-year changes in operating profit
included:
|
·
|
Significant
growth in Marine Electronics and Watercraft sales due to successful
new
product introductions.
|
|
·
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Reduced
restructuring and severance costs.
|
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·
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Reduced
overhead costs at corporate and operational levels.
|
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·
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Charges
totaling $1.5 million related to the temporary closure of the Company’s
Outdoor Equipment operations due to flooding caused by heavy rains
in the
Northeast.
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·
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The
conclusion of contracts for higher margin military tents and the
overall
decrease in military sales.
|
Net
income was $8.7 million, or $0.95 per diluted share, versus net income of $7.1
million, or $0.81 per diluted share, in the prior year.
“Our
focus on innovation and strategic acquisitions delivered industry-leading growth
in our consumer segments which outpaced our competition and more than offset
the
slowdown in military sales we expected. Excluding military sales in both this
and the prior year, our core brands grew nearly 10% and operating margins rose
a
full 3 points. Improved operating efficiency and targeted cost-savings efforts
further strengthened our competitiveness and profitability. It was a very good
year,” said Helen Johnson-Leipold, Chairman and Chief Executive Officer, Johnson
Outdoors Inc. “Our goal is to sustain the positive momentum we have built, and
continue to deliver profitable growth to enhance shareholder value. We will
seek
to do that by expanding our markets, our great brand equities and our leading
technology portfolio as we set our sights on becoming a half billion dollar
company in the next few years.”
Further
commenting, Ms. Johnson-Leipold said: “Clearly, European restructuring efforts
had an impact on Diving results this year, and will continue to do so to a
lesser degree through early 2008 when new systems should be fully implemented.
Investments in building awareness and distribution for our award-winning
electric boat line, which masked the strong performance of our paddle sports
brands this year, will also continue at a lower rate next year. We have worked
hard to strengthen operations and reduce the impact of one-time items on total
Company results, and next year we look for sales growth equal to this year
while
maintaining our focus on enhancing core brand operating margins. Our balance
sheet is strong and we are well positioned to capitalize on growth opportunities
for the future.”
OTHER
FINANCIAL INFORMATION
The
Company’s debt to total capitalization stood at 17% at the end of the year
versus 23% at October 1, 2005. Cash, net of debt, decreased $7.4 million to
$13.9 million by year end. Depreciation and amortization was $9.2 million
year-to-date compared with $9.4 million in the prior year. Capital spending
totaled $8.9 million in 2006 compared with last year’s $6.8
million.
3
“Significant
growth in Humminbird® and the acquisition of Cannon® and Bottom Line® brands
resulted in unfavorable comparisons in inventory and working capital this year.
Going forward, we remain focused on managing working capital efficiently and
expect to leverage our working capital base as we grow sales in the future.
Our
strong cash position and lower debt level should give us the ability and
flexibility we need to successfully execute our strategic growth plans,” said
David Johnson, Vice-President and Chief Financial Officer.
MILITARY
OUTLOOK
The
quarterly and year-over-year decline in military tent sales is consistent with
the Company’s stated projections throughout the year. During the fourth quarter
of the current year, the Company reported it was one of seven vendors awarded
a
multi-product military contract. No orders have been received against this
new
contract. The Company plans to bid on other future contracts, and at this time,
expects fiscal 2007 military sales to be in the $25-30 million range.
INNOVATION
UPDATE
Johnson
Outdoors delivers meaningful innovation to the outdoor recreation marketplace
driven by unique consumer insights, with new products representing one-third
of
total Company net sales in 2006. Strong new product growth continues to bolster
the Company’s already robust existing brands and differentiate the Company in
the industry. Among the innovative new products in Watercraft for 2007 are:
|
·
|
Old
Town® Dirigo™ Tandem Plus,
the first kayak designed for the whole family, with seating for two
adults
and two children. The Dirigo™ Tandem Plus builds on the success of other
family-focused kayaks in the Johnson Outdoors portfolio, such as
the
Necky® Manitou™ Tandem and Ocean Kayak™ Sidekick™.
|
|
·
|
Old
Town® Koru™,
the first infused composite canoe, which marries modern technology
with
classic design to deliver a premium paddling experience. The Koru
made big
waves with retailers at this year’s Outdoor Retailer Show, and at 17 feet
and 50 pounds is one of the lightest boats ever for its size.
|
|
·
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Lendal™
ION™
paddle, the first “glow in the dark” kayak paddle designed for sunset and
moonlight paddling adventures, a must-have for outfitters and avid
paddlers everywhere.
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WEBCAST
The
Company will host a conference call and audio web cast on Friday, November
17,
2006 at 11:00 a.m. Eastern Time. A live listen-only web cast of the conference
call may be accessed at Johnson Outdoors' home page. A replay will also be
available on Johnson Outdoors' home page, or by dialing (888) 286-8010 or (617)
801-6888 and providing confirmation code 98359393. The replay will be available
through November 24, 2006 by phone and for 30 days on the Internet.
4
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; Lendal™ paddles; Escape® electric boats; Minn Kota® motors;
Cannon® downriggers; Humminbird®, Bottom Line® and Fishin’ Buddy® fishfinders;
Scubapro® and UWATEC® dive equipment; Silva® compasses and digital instruments;
and Eureka!® tents. The Company has
23
locations around the world, employs 1,300 people and reported revenues of $395.8
million in fiscal 2006.
Visit
Johnson Outdoors online at 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. 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 companies that
compete with the Company; the Company’s success in managing inventory; movements
in foreign currencies or interest rates; the Company’s success in restructuring
of its European Diving operations; unanticipated issues related to the Company’s
military sales; 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 evaluating 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
5
JOHNSON
OUTDOORS INC. AND SUBSIDIARIES
|
(thousands,
except per share amounts)
|
|||||||||||||||||
|
Operating
Results
|
THREE
MONTHS ENDED*
|
TWELVE
MONTHS ENDED*
|
|||||||||||||||
|
|
Sept
29
2006
|
|
|
Sept
30
2005
|
|
|
|
|
Sept
29
2006
|
|
|
Sept
30
2005
|
|||||
|
Net
sales
|
$
|
80,314
|
$
|
77,095
|
$
|
395,790
|
$
|
380,690
|
|||||||||
|
Cost
of sales
|
46,274
|
48,505
|
230,574
|
224,336
|
|||||||||||||
|
Gross
profit
|
34,040
|
28,590
|
165,216
|
156,354
|
|||||||||||||
|
Operating
expenses
|
34,784
|
33,201
|
144,591
|
140,823
|
|||||||||||||
|
Operating
profit (loss)
|
(744
|
)
|
(4,611
|
)
|
20,625
|
15,531
|
|||||||||||
|
Interest
expense, net
|
910
|
1,111
|
4,485
|
4,225
|
|||||||||||||
|
Other
expenses (income), net
|
(85
|
)
|
116
|
376
|
(796
|
)
|
|||||||||||
|
Income
(loss) before income taxes
|
(1,569
|
)
|
(5,838
|
)
|
15,764
|
12,102
|
|||||||||||
|
Income
tax expense (benefit)
|
(645
|
)
|
(2,439
|
)
|
7,049
|
5,001
|
|||||||||||
|
Net
income (loss)
|
$
|
(924
|
)
|
$
|
(3,399
|
)
|
$
|
8,715
|
$
|
7,101
|
|||||||
|
Basic
earnings (loss) per common share:
|
$
|
(0.10
|
)
|
$
|
(0.39
|
)
|
$
|
0.97
|
$
|
0.82
|
|||||||
|
Diluted
earnings (loss) per common share:
|
$
|
(0.10
|
)
|
$
|
(0.39
|
)
|
$
|
0.95
|
$
|
0.81
|
|||||||
|
Diluted
average common shares outstanding
|
9,001
|
8,629
|
9,161
|
8,795
|
|||||||||||||
|
Segment
Results
|
|||||||||||||||||
|
Net
sales:
|
|||||||||||||||||
|
Marine
electronics
|
$
|
25,341
|
$
|
22,481
|
$
|
164,472
|
$
|
145,231
|
|||||||||
|
Outdoor
equipment
|
12,481
|
14,906
|
65,948
|
75,340
|
|||||||||||||
|
Watercraft
|
19,241
|
18,485
|
87,302
|
80,849
|
|||||||||||||
|
Diving
|
23,270
|
21,054
|
78,473
|
79,404
|
|||||||||||||
|
Other/eliminations
|
(19
|
)
|
169
|
(405
|
)
|
(134
|
)
|
||||||||||
|
Total
|
$
|
80,314
|
$
|
77,095
|
$
|
395,790
|
$
|
380,690
|
|||||||||
|
Operating
profit (loss):
|
|||||||||||||||||
|
Marine
electronics
|
$
|
870
|
$
|
756
|
$
|
21,583
|
$
|
21,572
|
|||||||||
|
Outdoor
equipment
|
1,142
|
1,740
|
8,236
|
11,208
|
|||||||||||||
|
Watercraft
|
(1,989
|
)
|
(2,323
|
)
|
(2,573
|
)
|
(4,353
|
)
|
|||||||||
|
Diving
|
2,426
|
(203
|
)
|
5,604
|
4,901
|
||||||||||||
|
Other/eliminations
|
(3,193
|
)
|
(4,581
|
)
|
(12,225
|
)
|
(17,797
|
)
|
|||||||||
|
Total
|
$
|
(744
|
)
|
$
|
(4,611
|
)
|
$
|
20,625
|
$
|
15,531
|
|||||||
|
Balance
Sheet Information (End
of Period)
|
|||||||||||||||||
|
Cash
and short-term investments
|
$
|
51,689
|
$
|
72,111
|
|||||||||||||
|
Accounts
receivable, net
|
52,844
|
48,274
|
|||||||||||||||
|
Inventories,
net
|
63,828
|
51,885
|
|||||||||||||||
|
Total
current assets
|
184,897
|
186,035
|
|||||||||||||||
|
Total
assets
|
284,226
|
283,318
|
|||||||||||||||
|
Short-term
debt
|
17,000
|
13,000
|
|||||||||||||||
|
Total
current liabilities
|
74,650
|
69,196
|
|||||||||||||||
|
Long-term
debt
|
20,807
|
37,800
|
|||||||||||||||
|
Shareholders’
equity
|
180,881
|
166,434
|
|||||||||||||||
*
Unaudited
6