Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Apr. 30, 2024 | Jun. 18, 2024 | Oct. 31, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Apr. 30, 2024 | ||
Document Fiscal Year Focus | 2024 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Smith & Wesson Brands, Inc. | ||
Entity Central Index Key | 0001092796 | ||
Current Fiscal Year End Date | --04-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity File Number | 1-31552 | ||
Entity Incorporation, State or Country Code | NV | ||
Entity Tax Identification Number | 87-0543688 | ||
Entity Address, Address Line One | 2100 Roosevelt Avenue | ||
Entity Address, City or Town | Springfield | ||
Entity Common Stock, Shares Outstanding | 45,559,503 | ||
Entity Address, State or Province | MA | ||
Auditor Name | Deloitte & Touche LLP | ||
Entity Address, Postal Zip Code | 01104 | ||
City Area Code | 800 | ||
Auditor Location | Hartford, CT, USA | ||
Local Phone Number | 331-0852 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
ICFR Auditor Attestation Flag | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Entity Public Float | $ 665,373,220 | ||
Title of each Class | Common Stock, Par Value $.001 per Share | ||
Trading Symbol | SWBI | ||
Name of exchange on which registered | NASDAQ | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement for the 2024 Annual Meeting of Stockholders are incorporated by reference into Part III of this Form 10-K. | ||
Auditor Firm ID | 34 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 60,839 | $ 53,556 |
Accounts receivable, net of allowances for credit losses of $0 on April 30, 2024 and $23 on April 30, 2023 | 59,071 | 55,153 |
Inventories | 160,500 | 177,118 |
Prepaid expenses and other current assets | 4,973 | 4,917 |
Income tax receivable | 2,495 | 1,176 |
Total current assets | 287,878 | 291,920 |
Property, plant, and equipment, net | 252,633 | 210,330 |
Intangibles, net | 2,598 | 3,588 |
Goodwill | 19,024 | 19,024 |
Deferred income taxes | 7,249 | 8,085 |
Other assets | 8,614 | 8,347 |
Total assets | 577,996 | 541,294 |
Current liabilities: | ||
Accounts payable | 41,831 | 36,795 |
Accrued expenses and deferred revenue | 26,811 | 20,149 |
Accrued payroll and incentives | 17,147 | 18,565 |
Accrued income taxes | 0 | 1,831 |
Accrued profit sharing | 9,098 | 8,203 |
Accrued warranty | 1,813 | 1,670 |
Total current liabilities | 96,700 | 87,213 |
Notes and loans payable (Note 4) | 39,880 | 24,790 |
Finance lease payable, net of current portion | 35,404 | 36,961 |
Other non-current liabilities | 7,852 | 7,707 |
Total liabilities | 179,836 | 156,671 |
Commitments and contingencies (Note 15) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 20,000,000 shares authorized, no shares issued or outstanding | 0 | 0 |
Common stock, $0.001 par value, 100,000,000 shares authorized, 75,395,490 issued and 45,561,569 shares outstanding on April 30, 2024 and 75,029,300 shares issued and 45,988,930 shares outstanding on April 30, 2023 | 75 | 75 |
Additional paid-in capital | 289,994 | 283,666 |
Retained earnings | 540,660 | 523,184 |
Accumulated other comprehensive income | 73 | 73 |
Treasury stock, at cost (29,833,921 shares on April 30, 2024 and 29,040,370 shares on April 30, 2023) | (432,642) | (422,375) |
Total stockholders’ equity | 398,160 | 384,623 |
Total liabilities and stockholders' equity | $ 577,996 | $ 541,294 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for credit losses | $ 0 | $ 23 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 75,395,490 | 75,029,300 |
Common stock, shares outstanding | 45,561,569 | 45,988,930 |
Treasury stock, shares | 29,833,921 | 29,040,370 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Income Statement [Abstract] | |||
Net sales | $ 535,833 | $ 479,242 | $ 864,126 |
Cost of sales | 377,740 | 324,705 | 489,562 |
Gross profit | 158,093 | 154,537 | 374,564 |
Operating expenses: | |||
Research and development | 7,266 | 7,550 | 7,262 |
Selling, marketing, and distribution | 40,564 | 36,976 | 43,156 |
General and administrative | 65,484 | 61,604 | 72,493 |
Total operating expenses | 113,314 | 106,130 | 122,911 |
Operating income | 44,779 | 48,407 | 251,653 |
Other income/(expense), net: | |||
Other income, net | 6,672 | 150 | 2,868 |
Interest expense, net | (2,055) | (331) | (2,135) |
Total other income/(expense), net | 4,617 | (181) | 733 |
Income from operations before income taxes | 49,396 | 48,226 | 252,386 |
Income tax expense | (9,787) | (11,350) | (57,892) |
Net income | $ 39,609 | $ 36,876 | $ 194,494 |
Net income per share: | |||
Basic - net income | $ 0.86 | $ 0.8 | $ 4.12 |
Diluted - net income | $ 0.86 | $ 0.8 | $ 4.08 |
Weighted average number of common shares outstanding: | |||
Basic | 45,813 | 45,844 | 47,227 |
Diluted | 46,248 | 46,170 | 47,728 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Treasury Stock |
Balance at Apr. 30, 2021 | $ 266,384 | $ 74 | $ 273,431 | $ 325,181 | $ 73 | $ (332,375) |
Balance (in shares) at Apr. 30, 2021 | 74,222,000 | |||||
Treasury stock (in shares) at Apr. 30, 2021 | 24,285,000 | |||||
Stock-based compensation | 4,536 | 4,536 | ||||
Shares issued under employee stock purchase plan | 1,719 | 1,719 | ||||
Shares issued under employee stock purchase plan (in shares) | 129,000 | |||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered | (1,584) | $ 1 | (1,585) | |||
Issuance of common stock under restricted stock unit awards, net of shares surrendered (in shares) | 290,000 | |||||
Repurchase of treasury stock | (90,000) | $ (90,000) | ||||
Repurchase of treasury stock, shares | 4,755,000 | |||||
Dividends issued | (15,035) | (15,035) | ||||
Net Income (Loss) | 194,494 | 194,494 | ||||
Balance at Apr. 30, 2022 | 360,514 | $ 75 | 278,101 | 504,640 | 73 | $ (422,375) |
Balance (in shares) at Apr. 30, 2022 | 74,641,000 | |||||
Treasury stock (in shares) at Apr. 30, 2022 | 29,040,000 | |||||
Stock-based compensation | 5,102 | 5,102 | ||||
Shares issued under employee stock purchase plan | $ 1,528 | 1,528 | ||||
Shares issued under employee stock purchase plan (in shares) | 175,047 | 175,000 | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered | $ (1,065) | (1,065) | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered (in shares) | 213,000 | |||||
Dividends issued | (18,333) | (18,333) | ||||
Net Income (Loss) | 36,876 | 36,876 | ||||
Balance at Apr. 30, 2023 | $ 384,623 | $ 75 | 283,666 | 523,184 | 73 | $ (422,375) |
Balance (in shares) at Apr. 30, 2023 | 45,988,930 | 75,029,000 | ||||
Treasury stock (in shares) at Apr. 30, 2023 | 29,040,370 | 29,040,000 | ||||
Stock-based compensation | $ 5,683 | 5,683 | ||||
Shares issued under employee stock purchase plan | $ 1,484 | 1,484 | ||||
Shares issued under employee stock purchase plan (in shares) | 151,225 | 151,000 | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered | $ (839) | (839) | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered (in shares) | 215,000 | |||||
Unpaid dividends accrued | (113) | (113) | ||||
Repurchase of treasury stock | (10,267) | $ (10,267) | ||||
Repurchase of treasury stock, shares | 794,000 | |||||
Dividends issued | (22,020) | (22,020) | ||||
Net Income (Loss) | 39,609 | 39,609 | ||||
Balance at Apr. 30, 2024 | $ 398,160 | $ 75 | $ 289,994 | $ 540,660 | $ 73 | $ (432,642) |
Balance (in shares) at Apr. 30, 2024 | 45,561,569 | 75,395,000 | ||||
Treasury stock (in shares) at Apr. 30, 2024 | 29,833,921 | 29,834,000 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Stockholders' Equity (Parenthetical) - $ / shares | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Statement [Table] | |||
Dividends issued | $ 0.48 | $ 0.4 | $ 0.32 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Cash flows from operating activities: | |||
Net Income | $ 39,609 | $ 36,876 | $ 194,494 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 32,558 | 31,436 | 30,073 |
(Gain)/Loss on sale/disposition of assets | (5,595) | (55) | 625 |
Provision for (recoveries)/losses on notes and accounts receivable | (23) | (27) | 689 |
Impairment of long-lived tangible assets | 0 | 0 | 86 |
Deferred income taxes | 835 | (6,864) | (2,125) |
Stock-based compensation expense | 5,683 | 5,102 | 4,536 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (3,896) | 7,569 | 4,058 |
Inventories | 16,618 | (40,458) | (58,183) |
Prepaid expenses and other current assets | (57) | 653 | 2,839 |
Income taxes | (3,149) | (74) | 480 |
Accounts payable | 18,341 | (8,606) | (26,957) |
Accrued payroll and incentives | (1,418) | 1,194 | (10) |
Accrued profit sharing | 895 | (5,340) | (902) |
Accrued expenses and deferred revenue | 6,318 | (3,618) | (9,725) |
Accrued warranty | 142 | (168) | (361) |
Other assets | (267) | 1,789 | 2,561 |
Other non-current liabilities | 145 | (2,677) | (4,364) |
Net cash provided by operating activities | 106,739 | 16,732 | 137,814 |
Cash flows from investing activities: | |||
Payments to acquire patents and software | (186) | (334) | (283) |
Proceeds from sale of property and equipment | 2,955 | 118 | 139 |
Proceeds from sale of intangible assets | 6,500 | 0 | 0 |
Payments to acquire property and equipment | (90,759) | (89,565) | (23,972) |
Net cash used in investing activities | (81,490) | (89,781) | (24,116) |
Cash flows from financing activities: | |||
Proceeds from loans and notes payable | 50,000 | 25,000 | 0 |
Payments on finance lease obligation | (1,378) | (1,253) | (1,087) |
Payments on notes and loans payable | (35,000) | 0 | 0 |
Payments to acquire treasury stock | (10,213) | 0 | (90,000) |
Dividend distribution | (22,020) | (18,333) | (15,035) |
Proceeds to acquire common stock from employee stock purchase plan | 1,484 | 1,528 | 1,719 |
Payment of employee withholding tax related to restricted stock units | (839) | (1,065) | (1,584) |
Net cash (used in)/ provided by financing activities | (17,966) | 5,877 | (105,987) |
Net (decrease)/increase in cash and cash equivalents | 7,283 | (67,172) | 7,711 |
Cash and cash equivalents, beginning of period | 53,556 | 120,728 | 113,017 |
Cash and cash equivalents, end of period | 60,839 | 53,556 | 120,728 |
Supplemental disclosure of cash flow information Cash paid for: | |||
Interest | 4,745 | 2,148 | 2,219 |
Income taxes | 12,662 | 18,208 | 59,183 |
Supplemental Disclosure of Non-cash Investing and Financing Activities: | |||
Purchases of property and equipment included in accounts payable | 2,462 | 15,767 | 408 |
Capital lease included in accrued expenses and finance lease payable | $ 612 | $ 767 | $ 0 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ 39,609 | $ 36,876 | $ 194,494 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Apr. 30, 2024 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | The adoption or termination of contracts, instructions, or written plans for the purchase and sale of our securities by our Section 16 officers and directors for the three months ended April 30, 2024, each of which is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act, or a Rule 10b5-1 Plan, were as follows: Name Title Action Date Adopted Expiration Date Aggregate # of Securities to be Purchased/Sold Robert L. Scott Director Adoption of Rule 10b5-1 Plan March 29, 2024 October 28, 2024 8,071 Robert L. Scott, the Chairman of our Board of Directors, entered into a Rule 10b5-1 Plan on March 29, 2024. Mr. Scott's Rule 10b5-1 Plan provides for the potential sale of up to 8,071 shares of our common stock and expires on October 28, 2024, or upon the earlier completion of all the transactions authorized thereunder. During the three months ended April 30, 2024, none of our directors or officers adopted or terminated a "non-Rule 10b5-1 trading arrangement" (as defined in Item 408 of Regulation S-K) |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Robert L. Scott [Member] | |
Trading Arrangements, by Individual | |
Name | Robert L. Scott |
Title | Director |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 29, 2024 |
Arrangement Duration | 214 days |
Aggregate Available | 8,071 |
Expiration Date | October 28, 2024 |
Organization
Organization | 12 Months Ended |
Apr. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | 1. Organization We are one of the world’s leading manufacturers and designers of firearms. We manufacture a wide array of handguns (including revolvers and pistols), long guns (including modern sporting rifles, pistol caliber carbines, and lever action rifles), handcuffs, firearm suppressors, and other firearm-related products for sale to a wide variety of customers, including firearm enthusiasts, collectors, hunters, sportsmen, competitive shooters, individuals desiring home and personal protection, law enforcement and security agencies and officers, and military agencies in the United States and throughout the world. We sell our products under the Smith & Wesson and Gemtech brands. We manufacture our products at our facilities in Springfield, Massachusetts; Houlton, Maine; Deep River, Connecticut; and Maryville, Tennessee. We also sell our manufacturing services to other businesses to attempt to level-load our factories. We sell those services under our Smith & Wesson and Smith & Wesson Precision Components brands. During fiscal 2024, we began manufacturing and distribution activities from our new Maryville, Tennessee facility. See Note 15 — Commitments and Contingencies , and Note 16 — Restructuring for more information. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Apr. 30, 2024 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | 2. Significant Accounting Policies Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the financial statement dates and the reported amounts of revenue and expenses during the reporting periods. Our significant estimates include the accrual for warranty, reserves for excess and obsolete inventory, rebates and other promotions, valuation of intangible assets, and costs associated with the Relocation. Actual results could differ from those estimates. Principles of Consolidation — The accompanying consolidated financial statements include the accounts of Smith & Wesson Brands, Inc. and its wholly owned subsidiaries, including Smith & Wesson Inc., Smith & Wesson Sales Company, and SWPC Plastics, LLC. In our opinion, all adjustments, which include only normal recurring adjustments necessary to fairly present the financial position, results of operations, changes in stockholders’ equity, and cash flows at April 30, 2024 and 2023 and for the periods presented, have been included. All intercompany accounts and transactions have been eliminated in consolidation. Fair Value of Financial Instruments — Unless otherwise indicated, the fair values of all reported assets and liabilities, which represent financial instruments not held for trading purposes, approximate the carrying values of such amounts because of their short-term nature or market rates of interest. Cash and Cash Equivalents — We consider all highly liquid investments purchased with original maturities of three months or less at the date of acquisition to be cash equivalents. We maintain our cash in bank deposit accounts that, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. As of April 30, 2024, all of our accounts exceeded federally insured limits. Financial Instruments — We account for derivative instruments under Accounting Standards Codification (“ASC”) 815-10, Fair Value Measurements and Disclosure Topic , which establishes accounting and reporting standards for derivative instruments and hedging activities and requires us to recognize these instruments as either assets or liabilities on the balance sheet and measure them at fair value. As of April 30, 2024 and 2023, we did no t have any derivative instruments or any Level 2 or Level 3 financial instruments within the hierarchy. See Note 4 – Notes, Loans Payable, and Financing Arrangements for more information regarding our financial instruments. Trade Receivables — We extend credit to our domestic customers and some foreign distributors based on their financial condition. We sometimes offer discounts for early payment on invoices. When we believe the extension of credit is not advisable, we rely on either a prepayment or a letter of credit. We write off balances deemed uncollectible by us against our allowance for doubtful accounts. We estimate our allowance for doubtful accounts through current past due balances, knowledge of our customers’ financial situations, and past payment history. Concentrations of Credit Risk — Financial instruments that potentially subject us to concentration of credit risk consist principally of cash, cash equivalents, and trade receivables. We place our cash and cash equivalents in overnight U.S. government securities. Concentrations of credit risk with respect to trade receivables are limited by the large number of customers comprising our customer base and their geographic and business dispersion. We perform ongoing credit evaluations of our customers’ financial condition and generally do not require collateral. For fiscal 2024, sales to three of our customers exceeded 10.0 % of our net sales, totaling 34.8 %. As of April 30, 2024, two of our customers each accounted for more than 10 % of our accounts receivable, for a total of 47.9 %. For fiscal 2023, sales to two of our customers exceeded 10.0 % of our net sales, totaling 22.8 %. As of April 30, 2023, three of our customers each accounted for more than 10 % of our accounts receivable, for a total of 39.4 %. Inventories — We value inventories at the lower of cost, using the first-in, first-out, or FIFO, method or net realizable value. An allowance for potential non-saleable inventory due to excess stock or obsolescence is based upon a detailed review of inventory, past history, and expected future usage. Property, Plant, and Equipment — We record property, plant, and equipment, consisting of land, building, improvements, machinery, equipment, software, hardware, furniture, and fixtures, at cost and depreciate them using the straight-line method over their estimated useful lives. We charge expenditures for maintenance and repairs to earnings as incurred, and we capitalize additions, renewals, and betterments. Upon the retirement or other disposition of property and equipment, we remove the related cost and accumulated depreciation from the respective accounts and include any gain or loss in operations. We lease certain of our real estate, machinery, and photocopiers under non-cancelable operating and finance lease agreements, and we recognize expenses under our operating lease assets and liabilities at the commencement date based on the present value of lease payments over the lease term. The depreciable life of assets and leasehold improvements are based on the expected life of the lease. A summary of the estimated useful lives is as follows: Description Useful Life Building and improvements 10 to 40 years Software and hardware 2 to 7 years Machinery and equipment 2 to 10 years We include tooling, dies, and fixtures as part of machinery and equipment and depreciate them over a period generally not exceeding ten years . Intangible Assets — We record intangible assets at cost or based on the fair value of the assets acquired. Intangible assets consist of developed technology, customer relationships, trademarks, trade names, and patents. We amortize intangible assets over their estimated useful lives or in proportion to expected yearly revenue generated from the intangibles that were acquired. Revenue Recognition — We recognize revenue in accordance with the provisions of Accounting Standards Update, or ASU, Revenue from Contracts with Customers (Topic 606) , which became effective for us on May 1, 2018. Generally, all performance obligations are satisfied and revenue is recognized when the risks and rewards of ownership have transferred to the customer, which is generally upon shipment but could be delayed until the receipt of customer acceptance. In some instances, sales include multiple performance obligations. The most common of these instances relates to sales promotion programs under which customers are entitled to receive free goods based upon their purchase of our products, which we have identified as a material right. The fulfillment of these free goods is our responsibility. In such instances, we allocate the revenue of the promotional sales based on the estimated level of participation in the sales promotional program and the timing of the shipment of all of the products included in the promotional program, including the free goods. We recognize revenue related to the material right proportionally as each performance obligation is satisfied. The net change in contract liabilities for a given period is reported as an increase or decrease to sales. We generally sell our products free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 60 days of product shipment with a discount available to some customers for early payment. Generally, framework contracts define the general terms of sales, including payment terms, freight terms, insurance requirements, and cancelation provisions. Purchase orders define the terms for specific sales, including description, quantity, and price of each product purchased. We estimate variable consideration relative to the amount of cash discounts to which customers are likely to be entitled. As a result of utilizing practical expedients upon the adoption of ASC 606, we do not consider these extended terms to be a significant financing component of the contract because the payment terms are less than one year. In all cases, we consider our costs related to shipping and handling to be a cost of fulfilling the contract with the customer. Research and Development — We engage in both internal and external research and development, or R&D, in order to remain competitive and to exploit possible untapped market opportunities. We approve prospective R&D projects after analysis of the cost and benefits associated with the potential product. Costs in R&D expense include, among other items, salaries, materials, utilities, and administrative costs. Earnings per Share — We calculate basic and diluted earnings per common share in accordance with the provisions of ASC 260-10, Earnings Per Share . Basic earnings per common share equals net income divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share equals net income divided by the weighted average number of common shares outstanding during the period, including the effect of outstanding stock options and other stock-based instruments if their effect is dilutive. The following table provides a reconciliation of the net income amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings per common share (in thousands, except per share data): For the Year Ended April 30, 2024 2023 2022 Net income $ 39,609 $ 36,876 $ 194,494 Weighted average shares outstanding — Basic 45,813 45,844 47,227 Effect of dilutive stock awards 436 326 501 Weighted average shares outstanding — Diluted 46,248 46,170 47,728 Earnings per share — Basic $ 0.86 $ 0.80 $ 4.12 Earnings per share — Diluted $ 0.86 $ 0.80 $ 4.08 For fiscal 2024, 2023, and 2022, the number of shares excluded from the computation of diluted earnings per share was 18,009 , 30,307 , and 43,530 , respectively, because the effect would be antidilutive. Valuation of Long-lived Tangible and Intangible Assets — We evaluate the recoverability of long-lived assets, or asset groups, whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. When such evaluations indicate that the related future undiscounted cash flows are not sufficient to recover the carrying values of the assets, such carrying values are reduced to fair value and this adjusted carrying value becomes the asset’s new cost basis. We determine fair value primarily using future anticipated cash flows that are directly associated with and are expected to arise as a direct result of the use and eventual disposition of the asset, or asset group, discounted using an interest rate commensurate with the risk involved. We have significant long-lived tangible and intangible assets, which are susceptible to valuation adjustments as a result of changes in various factors or conditions. The most significant long-lived tangible and intangible assets, other than goodwill, are property, plant, and equipment, right of use assets, developed technology, customer relationships, patents, trademarks, and trade names. We amortize all finite-lived intangible assets either on a straight-line basis or based upon patterns in which we expect to utilize the economic benefits of such assets. We initially determine the values of intangible assets by a risk-adjusted, discounted cash flow approach. We assess the potential impairment of identifiable intangible assets and fixed assets whenever events or changes in circumstances indicate that the carrying values may not be recoverable and at least annually. Factors we consider important, which could trigger an impairment of such assets, include the following: • significant underperformance relative to historical or projected future operating results; • significant changes in the manner or use of the assets or the strategy for our overall business; • significant negative industry or economic trends; • a significant decline in our stock price for a sustained period; and • a decline in our market capitalization below net book value. Future adverse changes in these or other unforeseeable factors could result in an impairment charge that could materially impact future results of operations and financial position in the reporting period identified. In accordance with ASC 350, Intangibles-Goodwill and Other, we test goodwill for impairment on an annual basis on February 1 and between annual tests if indicators of potential impairment exist. The impairment test compares the fair value of the operating units to their carrying amounts to assess whether impairment is present. We have reviewed the provisions of ASC 350-20, with respect to the criteria necessary to evaluate the number of reporting units that exist. Based on this review, we concluded that we have one operating unit when reviewing ASC 350-20. We review the fair value of our goodwill based on financial performance annually. As of our last valuation date, February 1, 2024, we had $ 19.0 million of goodwill and its fair value significantly exceeded its carrying value, based on EBITDAS, cashflow, and market capitalization. Our assumptions related to the development of fair value could deviate materially from actual results and forecasts used to support asset carrying values may change in the future, which could result in non-cash charges that would adversely affect our financial results of operations. The re-measurement of goodwill is classified as a Level 3 fair value assessment as described in Note 10 - Fair Value Measurement, due to the significance of unobservable inputs developed using company-specific information. Income Taxes – We use the asset and liability approach for financial accounting and reporting income taxes. The provision for income taxes is based upon income reported in the accompanying consolidated financial statements as required by ASC 740, Income Taxes. We determine our deferred tax assets and liabilities based on temporary differences between financial reporting and tax bases in assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. We recognize the effect on deferred taxes of a change in tax rates in the period that includes the enactment date. In assessing the realization of our deferred tax assets, we consider whether it is more likely than not that the deferred tax assets will be realized. The ultimate realization of our deferred tax assets depends upon generating future taxable income during the periods in which our temporary differences become deductible and before our net operating loss carryforwards expire. We evaluate the recoverability of our deferred tax assets by assessing the need for a valuation allowance on a quarterly basis. If we determine that it is more likely than not that our deferred tax assets will not be recovered, we establish a valuation allowance against some or all of our deferred tax assets. Recording or reversing a valuation allowance could have a significant effect on our future results of operations and financial position. Warranty — We generally provide a limited one-year warranty and a lifetime service policy to the original purchaser of our new firearm products. We will also repair or replace certain products or parts found to be defective under normal use and service with an item of equivalent value, at our option, without charge during the warranty period. We quantify and record an estimate for warranty-related costs based on our actual historical claims experience and current repair costs. We adjust accruals as warranty claims data and historical experience warrant. Should we experience actual claims and repair costs that are higher than the estimated claims and repair costs used to calculate the provision, our operating results for the period or periods in which such returns or additional costs materialize would be adversely impacted. From time to time, we have experienced certain manufacturing and design issues with respect to some of our firearms and have initiated some product recalls and safety alerts. In February 2024, we initiated a safety recall for Response rifles manufactured prior to February 12, 2024 as a result of field reports related to the potential for an out of battery discharge. This safety recall was limited to Response rifles manufactured prior to February 12, 2024 and was conducted to ensure there were no anomalies or conditions that might adversely affect the safety, function, or performance of these rifles. The remaining estimated cost of all recalls, safety alerts, and consumer advisories is $ 38,000 , which is recorded in accrued warranty on our consolidated balance sheet as of April 30, 2024. The remaining balance relates to a general accrual related to standard warranty costs for products shipped in the ordinary course of business. Warranty expense for the fiscal years ended April 30, 2024, 2023, and 2022 amounted to $ 2.6 million, $ 1.5 million, and $ 1.9 million, respectively. The following table sets forth the change in accrued warranties, a portion of which is recorded as a non-current liability, in the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): Balance as of April 30, 2022 $ 4,873 Warranties issued and adjustments to provisions 1,496 Warranty claims ( 2,364 ) Balance as of April 30, 2023 4,005 Warranties issued and adjustments to provisions 2,560 Warranty claims ( 2,681 ) Balance as of April 30, 2024 $ 3,884 Sales and Promotional Related Expenses — We present product sales in our consolidated financial statements, net of customer promotional program costs that depend upon the volume of sales. For promotional program costs that do not depend on the volume of sales, we record promotional costs in cost of goods sold. The total of all our promotional programs amounted to $6 .6 million, $ 10.2 million, and $ 6.6 million for the fiscal years ended April 30, 2024, 2023, and 2022, respectively. We have a co-op advertising program at the retail level. We expensed sales and promotional related costs amounting to $ 2.6 million, $ 2.7 million, and $ 4.3 million for fiscal 2024, 2023, and 2022, respectively, as selling and marketing expenses. Shipping and Handling — In the accompanying consolidated financial statements, we included amounts billed to customers for shipping and handling in net sales. Inbound freight charges and internal transfer costs are included in cost of goods sold; however, costs incurred to distribute products to customers is included in selling, marketing, and distribution expenses. Insurance Reserves — In January 2020, we formed a wholly owned captive insurance company, which provides product liability insurance to us and our subsidiaries. We are self-insured through retentions or deductibles for the majority of our workers’ compensation, automobile, general liability, product liability, and group health insurance programs. Self-insurance amounts vary up to $ 10.0 million per occurrence; however, we believe the likelihood of reaching the maximum per occurrence limit is remote. We record our liability for estimated premiums and incurred losses in the accompanying consolidated financial statements on an undiscounted basis. Recently Issued Accounting Standards — There are no new accounting pronouncements that are expected to have a significant impact on our consolidated financial statements. |
Leases
Leases | 12 Months Ended |
Apr. 30, 2024 | |
Leases [Abstract] | |
Leases | 3. Leases We lease certain of our real estate, machinery, equipment, and photocopiers under non-cancelable operating and finance lease agreements. We recognize expenses for our operating lease assets and liabilities at the commencement date based on the present value of lease payments over the lease term. Our leases do not provide an implicit interest rate. We use our incremental borrowing rate based on the information available at the lease commencement date in determining the present value of lease payments. Our lease agreements do not require material variable lease payments or residual value guarantees, nor do they include restrictive covenants. For operating leases, we recognize expense on a straight-line basis over the lease term. Tenant improvement allowances are recorded as an offsetting adjustment included in our calculation of the respective right-of-use asset. Many of our leases include renewal options that enable us to extend the lease term. The execution of those renewal options is at our sole discretion and renewals are reflected in the lease term when they are reasonably certain to be exercised. The depreciable life of assets and leasehold improvements are limited by the expected lease term. The amounts of assets and liabilities related to our operating and financing leases as of April 30, 2024 were as follows (in thousands): Balance Sheet Caption April 30, 2024 April 30, 2023 Operating Leases Right-of-use assets $ 6,761 $ 5,994 Accumulated amortization ( 5,411 ) ( 4,153 ) Right-of-use assets, net Other assets $ 1,350 $ 1,841 Current liabilities Accrued expenses and deferred revenue $ 947 $ 1,274 Non-current liabilities Other non-current liabilities 574 801 Total operating lease liabilities $ 1,521 $ 2,075 Finance Leases Right-of-use assets $ 41,631 $ 41,631 Accumulated depreciation ( 11,713 ) ( 9,448 ) Right-of-use assets, net Property, plant, and equipment, net $ 29,918 $ 32,183 Current liabilities Accrued expenses and deferred revenue $ 1,564 $ 1,434 Non-current liabilities Finance lease payable, net of current portion 35,404 36,961 Total finance lease liabilities $ 36,968 $ 38,395 During fiscal 2024, we recorded $ 1.5 million of operating lease costs, of which $ 98,000 related to short-term leases that were not recorded as right-of-use assets. We recorded $ 2.3 million of finance lease amortization and $ 1.9 million of financing lease interest expense during fiscal 2024. As of April 30, 2024, our weighted average lease term and weighted average discount rate for our operating leases was 2.2 years and 3.2 %, respectively. As of April 30, 2024, our weighted average lease term and weighted average discount rate for our financing leases were 14.4 years and 5.0 %, respectively, and consisted primarily of our Missouri distribution center. The building is pledged to secure the amounts outstanding. The depreciable lives of right-of-use assets are limited by the lease term and are amortized on a straight-line basis over the life of the lease. On October 26, 2017, we entered into (a) a lease agreement with Ryan Boone County, LLC, or the Original Missouri Landlord, concerning certain real property located in Boone County, Missouri on which we have been operating our distribution center, or the Missouri Lease, and (b) a guaranty in favor of the Original Missouri Landlord, or the Guaranty. With the completion of the Separation, we entered into a sublease under which American Outdoor Brands, Inc., our former wholly owned subsidiary, or AOUT, subleases from us 59.0 % of our Missouri distribution center under the same terms as the Missouri Lease, or the Sublease. On July 16, 2022, we entered into an amendment to the Sublease, increasing the leased space to 64.7 % of the facility under the same terms as the Missouri Lease. As part of the Relocation, on January 31, 2023, we entered into (i) an assignment and assumption agreement with AOUT, pursuant to which AOUT will assume all of our rights, entitlement, and obligations in, to, and under the Missouri Lease, in each case, which became effective on January 1, 2024, and (ii) an amended and restated guaranty in favor of RCS-S&W Facility, LLC, as successor in interest to the Original Missouri Landlord, pursuant to which Smith & Wesson Sales Company was added as a guarantor, or the Amended and Restated Guaranty. We terminated the Missouri Sublease as of January 1, 2024. For the fiscal year April 30, 2024, income related to the Sublease was $ 2.7 million, of which $ 1.3 million was recorded in general and administrative expense and $ 1.4 million was recorded in interest expense, net, in our consolidated statements of income. In addition, o n January 5, 2024, we entered into an amendment to extend the lease term on our Deep River facility through January 4, 2025. We intend to occupy the facility at least through the current lease termination date. We do not believe there are any indications of impairment relating to assets being utilized at the Deep River facility. The following table represents future expected undiscounted cashflows, based on the Assignment and Assumption Agreement with AOUT, to be received on an annual basis for the next five years and thereafter, as of April 30, 2024 (in thousands): Fiscal Amount 2025 $ 3,180 2026 3,235 2027 3,292 2028 3,350 2029 3,408 Thereafter 35,498 Total future receipts 51,963 Less amounts representing interest ( 15,607 ) Present value of receipts $ 36,356 Future lease payments for all our operating and finance leases for succeeding fiscal years is as follows (in thousands): Operating Financing Total 2025 $ 1,033 $ 3,378 $ 4,411 2026 301 3,433 3,734 2027 272 3,498 3,770 2028 125 3,416 3,541 2029 — 3,408 3,408 Thereafter — 35,498 35,498 Total future lease payments 1,731 52,631 54,362 Less amounts representing interest ( 210 ) ( 15,663 ) ( 15,873 ) Present value of lease payments 1,521 36,968 38,489 Less current maturities of lease liabilities ( 947 ) ( 1,564 ) ( 2,511 ) Long-term maturities of lease liabilities $ 574 $ 35,404 $ 35,978 During fiscal 2024, the cash paid for amounts included in the measurement of liabilities and operating cash flows was $ 4.6 million. |
Notes, Loans Payable, and Finan
Notes, Loans Payable, and Financing Arrangements | 12 Months Ended |
Apr. 30, 2024 | |
Debt Disclosure [Abstract] | |
Notes, Loans Payable, and Financing Arrangements | 4. Notes, Loans Payable, and Financing Arrangements Credit Facilities — On August 24, 2020, we and certain of our subsidiaries entered into an amended and restated credit agreement, or the Amended and Restated Credit Agreement, with certain lenders, including TD Bank, N.A., as administrative agent; TD Securities (USA) LLC and Regions Bank, as joint lead arrangers and joint bookrunners; and Regions Bank, as syndication agent. The Amended and Restated Credit Agreement is currently unsecured; however, should any Springing Lien Trigger Event (as defined in the Amended and Restated Credit Agreement) occur, we and certain of our subsidiaries would be required to execute certain documents in favor of TD Bank, N.A., as administrative agent, and the lenders party to such documents would have a legal, valid, and enforceable first priority lien on the collateral described therein. The Amended and Restated Credit Agreement provides for a revolving line of credit of $ 100.0 million at any one time, or the Revolving Line. The Revolving Line bears interest at either the Base Rate (as defined in the Amended and Restated Credit Agreement) or the SOFR rate, plus an applicable margin based on our consolidated leverage ratio. The Amended and Restated Credit Agreement also provides a swingline facility in the maximum amount of $ 5.0 million at any one time (subject to availability under the Revolving Line). Each Swingline Loan (as defined in the Amended and Restated Credit Agreement) bears interest at the Base Rate, plus an applicable margin based on our Adjusted Consolidated Leverage Ratio (as defined in the Amended and Restated Credit Agreement) . Subject to the satisfaction of certain terms and conditions described in the Amended and Restated Credit Agreement, we have an option to increase the Revolving Line by an aggregate amount not exceeding $ 50.0 million. The Revolving Line matures on the earlier of August 24, 2025 or the date that is six months in advance of the earliest maturity of any Permitted Notes (as defined in the Amended and Restated Credit Agreement) under the Amended and Restated Credit Agreement. On April 28, 2023, we entered into an amendment to our existing credit agreement to, among other things, replace LIBOR with SOFR as the interest rate benchmark and amend the definition of “Consolidated Fixed Charge Coverage Ratio” to exclude unfinanced capital expenditures in connection with the Relocation. As of April 30, 2024, we had $ 40.0 million of borrowings outstanding on the Revolving Line, which bore an interest rate of 7.18 % , which is equal to the SOFR rate plus an applicable margin. As a result of the construction associated with the Relocation, $ 759,000 of interest was capitalized as of April 30, 2024. The Amended and Restated Credit Agreement contains customary limitations, including limitations on indebtedness, liens, fundamental changes to business or organizational structure, investments, loans, advances, guarantees, and acquisitions, asset sales, dividends, stock repurchases, stock redemptions, and the redemption or prepayment of other debt, and transactions with affiliates. We are also subject to financial covenants, including a minimum consolidated fixed charge coverage ratio and a maximum consolidated leverage ratio. As of April 30, 2024, we were compliant with all required financial covenants. Letters of Credit – At April 30, 2024, we had outstanding letters of credit aggregating $ 2.7 million, which included a $ 1.5 million letter of credit to collateralize our captive insurance company. Debt Issuance Costs — During the fiscal years ended 2024, 2023, and 2022, we did not incur any debt issuance costs. We recorded, in notes payable, $ 450,000 of debt issuance costs during fiscal 2021. The remaining costs are being amortized to expense over the life of the credit facility. In total, we amortized $ 89,805 , $ 89,560 , and $ 89,560 to interest expense for all debt issuance costs in fiscal 2024, 2023, and 2022, respectively. |
Net Sales
Net Sales | 12 Months Ended |
Apr. 30, 2024 | |
Disclosure Net Sales [Abstract] | |
Net Sales | 5. Net Sales The following table sets forth the breakdown of net sales for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Years Ended April 30, 2024 2023 2022 Handguns $ 381,898 $ 360,668 $ 624,219 Long Guns 116,491 74,230 189,467 Other Products & Services 37,444 44,344 50,440 Total Net Sales $ 535,833 $ 479,242 $ 864,126 We sell our products and services under our Smith & Wesson and Gemtech brands. Depending upon the product or service, our customers primarily include distributors; federal, state, and municipal law enforcement agencies and officers; government and military agencies; businesses; and retailers. We sell our products worldwide. The following table sets forth the breakdown of export net sales included in the above table. Our export net sales shown below accounted for approximately 5 %, 4 %, and 3 % of total net sales for the fiscal years ended April 30, 2024, 2023, and 2022, respectively (in thousands): For the Years Ended April 30, Region 2024 2023 2022 Asia $ 9,346 $ 5,411 $ 3,899 Latin America 5,314 4,052 5,272 Europe 4,786 6,569 8,342 All others international 5,143 3,736 8,014 Total international net sales $ 24,589 $ 19,768 $ 25,527 |
Advertising Costs
Advertising Costs | 12 Months Ended |
Apr. 30, 2024 | |
Marketing and Advertising Expense [Abstract] | |
Advertising Costs | 6. Advertising Costs We expense advertising costs, primarily consisting of magazine advertisements, printed materials, television advertisements, digital advertisements, radio advertisements, and billboards, either as incurred or upon the first occurrence of the advertising. Advertising expense, included in selling, marketing, and distribution expenses, for the fiscal years ended April 30, 2024, 2023, and 2022, amounted to $ 14.7 million, $ 14.7 million, and $ 17.5 million, respectively. |
Property, Plant, and Equipment
Property, Plant, and Equipment | 12 Months Ended |
Apr. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment | 7. Property, Plant, and Equipment The following table summarizes property, plant, and equipment as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Machinery and equipment $ 337,772 $ 308,852 Building and improvements 154,507 40,131 Software and hardware 52,750 49,569 Land and improvements 3,109 2,945 Right of use assets 41,631 41,631 589,769 443,128 Less: Accumulated depreciation and amortization ( 352,615 ) ( 334,383 ) 237,154 108,745 Construction in progress 15,479 101,585 Total property, plant, and equipment, net $ 252,633 $ 210,330 Depreciation of tangible assets and amortization of software expense amounted to $ 32.0 million, $ 31.0 million, and $ 29.5 million for the fiscal years ended April 30, 2024, 2023, and 2022, respectively. The following table summarizes depreciation and amortization expense, which includes amortization of intangibles and debt financing costs, by line item for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Years Ended April 30, 2024 2023 2022 Cost of sales $ 20,607 $ 22,205 $ 21,879 Research and development 533 529 484 Selling, marketing, and distribution 3,635 1,524 509 General and administrative 7,693 7,088 7,111 Interest expense 90 90 90 Total depreciation and amortization $ 32,558 $ 31,436 $ 30,073 |
Inventories
Inventories | 12 Months Ended |
Apr. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Inventories | 8. Inventories The following table sets forth a summary of inventories, net of reserves, stated at lower of cost or net realizable value, as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Finished goods $ 83,337 $ 93,705 Finished parts 56,282 65,460 Work in process 8,033 6,821 Raw material 12,848 11,132 Total inventories $ 160,500 $ 177,118 |
Accrued Expenses and Deferred R
Accrued Expenses and Deferred Revenue | 12 Months Ended |
Apr. 30, 2024 | |
Payables and Accruals [Abstract] | |
Accrued Expenses and Deferred Revenue | 9. Accrued Expenses and Deferred Revenue The following table sets forth other accrued expenses as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Accrued taxes other than income $ 5,838 $ 3,703 Accrued professional fees 4,925 2,596 Accrued other 4,423 4,597 Accrued settlement 3,200 — Accrued employee benefits 2,742 3,256 Accrued distributor incentives 1,687 1,640 Current portion of finance lease obligation 1,564 1,434 Accrued rebates and promotions 1,485 1,649 Current portion of operating lease obligation 947 1,274 Total accrued expenses and deferred revenue $ 26,811 $ 20,149 |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Apr. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | 10. Fair Value Measurement We follow the provisions of ASC 820-10, Fair Value Measurements and Disclosures Topic , or ASC 820-10, for our financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820-10 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value. Financial assets and liabilities recorded on the accompanying consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: Level 1 — Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we have the ability to access at the measurement date (examples include active exchange-traded equity securities, listed derivatives, and most U.S. Government and agency securities). Our cash and cash equivalents, which are measured at fair value on a recurring basis, totaled $ 60.8 million and $ 53.6 million as of April 30, 2024 and 2023, respectively. The carrying value of our revolving line of credit approximated the fair value as of April, 30, 2024. We utilized Level 1 of the value hierarchy to determine the fair values of these assets. Level 2 — Financial assets and liabilities whose values are based on quoted prices in markets in which trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets. Level 2 inputs include the following: • quoted prices for identical or similar assets or liabilities in non-active markets (such as corporate and municipal bonds which trade infrequently); • inputs other than quoted prices that are observable for substantially the full term of the asset or liability (such as interest rate and currency swaps); and • inputs that are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability (such as certain securities and derivatives). Level 3 — Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect our assumptions about the assumptions a market participant would use in pricing the asset or liability. As of April 30, 2024, we did no t have any Level 2 or Level 3 financial assets or liabilities. |
Self-Insurance Reserves
Self-Insurance Reserves | 12 Months Ended |
Apr. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Self-Insurance Reserves | 11. Self-Insurance Reserves As of April 30, 2024 and 2023, we had reserves for workers’ compensation, product liability, and medical/dental costs totaling $ 8.7 million and $ 9.2 million, respectively, of which $ 3.3 million and $ 2.6 million, respectively, was classified as other non-current liabilities. As of April 30, 2024 and 2023, $ 5.4 million and $ 6.6 million, respectively, were included in accrued expenses or accounts payable on the accompanying consolidated balance sheets. In addition, as of April 30, 2024 and 2023, $ 984,000 and $ 663,000 , respectively, of workers’ compensation recoverable was classified as other assets. While we believe these reserves to be adequate, it is possible that the ultimate liabilities will exceed such estimates. The following table summarizes the activity in the workers’ compensation, product liability, municipal liability, and medical/dental reserves in the fiscal years ended April 30, 2024 and 2023 (in thousands): For the Year Ended April 30, 2024 2023 Beginning balance $ 9,239 $ 8,676 Additional provision charged to expense 2,921 3,589 Payments ( 3,461 ) ( 3,026 ) Ending balance $ 8,699 $ 9,239 It is our policy to provide an estimate for loss as a result of expected adverse findings or legal settlements on product liability, workers’ compensation, and other matters when such losses are probable and are reasonably estimable. It is also our policy to accrue for reasonably estimable legal costs associated with defending such litigation. While such estimates involve a range of possible costs, we determine, in consultation with counsel, the most likely cost within such range on a case-by-case basis. We also record receivables from insurance carriers relating to these matters when their collection is probable and reasonably estimable. As of April 30, 2024 and 2023, we had accrued reserves for product litigation liabilities of $ 3.1 million and $ 4.3 million, respectively (of which $ 497,000 and $ 568,000 , respectively, was non-current), consisting entirely of expected legal defense costs. During fiscal 2024, we did not record any receivables from insurance carriers related to these liabilities. Prior to fiscal 2024, we had recorded receivables from insurance carriers related to these liabilities of $ 1.9 million, nearly all of which has been classified as other non-current assets. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Apr. 30, 2024 | |
Equity [Abstract] | |
Stockholders' Equity | 12. Stockholders’ Equity Treasury Stock On September 19, 2023, our Board of Directors authorized the repurchase of $ 50.0 million of our common stock, subject to certain conditions, in the open market or in privately negotiated transactions through September 19, 2024. During fiscal 2024, we purchased 793,551 shares of our common stock for $ 10.2 million under this authorization. We did not purchase any shares of our common stock during fiscal 2023, and we did not have an authorized repurchase program as of April 30, 2023. During fiscal 2022, we repurchased 1,967,420 of our common stock for $ 40.0 million, utilizing cash on hand under an available program that our Board of Directors authorized in fiscal 2021. On June 15, 2021, our Board of Directors authorized the repurchase of an additional $ 50.0 million of our common stock, subject to certain conditions, in the open market or in privately negotiated transactions. Pursuant to this authorization, during fiscal 2022, we completed this repurchase program by purchasing 2,788,152 shares of our common stock for $ 50.0 million, utilizing cash on hand. Incentive Stock and Employee Stock Purchase Plans We have two stock incentive plans: the 2013 Incentive Stock Plan and the 2022 Incentive Stock Plan. New grants under the 2013 Incentive Stock Plan have not been made since our stockholders approved the 2022 Incentive Stock Plan at our annual meeting of stockholders held on September 12, 2022. All new grants covering participants are issued under the 2022 Incentive Stock Plan. The 2022 Incentive Stock Plan authorizes the issuance of 1,000,000 shares, plus 4,312,247 shares that were reserved and remained available for grant and delivery under the 2013 Incentive Stock Plan as of September 12, 2022, the effective date of the 2022 Incentive Stock Plan. The 2022 Incentive Stock Plan permits the grant of options to acquire common stock, restricted stock awards, restricted stock units, or RSUs, stock appreciation rights, bonus stock and awards in lieu of obligations, performance awards, and dividend equivalents. Our Board of Directors, or a committee of our board, administers the stock plans, selects recipients to whom awards are granted, and determines the grants to be awarded. Options granted under the stock plans are exercisable at a price determined by our Board of Directors or a committee of our board at the time of grant, but in no event, less than fair market value of our common stock on the effective date of the grant. Grants of options may be made to employees and directors without regard to any performance measures. All options issued pursuant to the stock plans are generally nontransferable and subject to forfeiture. Unless terminated earlier by our Board of Directors, the 2022 Incentive Stock Plan will terminate at the earliest of (1) the tenth anniversary of the effective date of the 2022 Incentive Stock Plan, or (2) such time as no shares of common stock remain available for issuance under the plan and we have no further rights or obligations with respect to outstanding awards under the plan. The date of grant of an award is deemed to be the effective date upon which our Board of Directors or a committee authorizes the granting of such award. Except in specific circumstances, grants of stock options vest over a period of four years and are exercisable for a period of 10 years after vesting. The 2022 Incentive Stock Plan also permits the grant of stock options to non-employees, which our Board of Directors or a committee has authorized in the past. There were no outstanding and exercisable stock options in fiscal 2024, 2023, and 2022. The following table summarizes stock compensation expense by line item for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Year Ended April 30, 2024 2023 2022 Cost of sales $ 648 $ 667 $ 809 Research and development 77 80 61 Selling, marketing, and distribution 930 814 844 General and administrative 4,028 3,541 2,822 Total stock-based compensation $ 5,683 $ 5,102 $ 4,536 As of April 30, 2024, there were 5,420,444 shares available for grant under the 2022 Incentive Stock Plan. We use our unissued share pool for all shares issued for options, restricted stock awards, RSUs, performance share units, performance-based restricted stock units, or PSUs, and shares issued under our Employee Stock Purchase Plan, or ESPP. We grant service-based RSUs to employees, consultants, and directors. The awards are made at no cost to the recipient. An RSU represents the right to acquire one share of our common stock and does not carry voting or dividend rights. Except in specific circumstances, RSU grants to employees and consultants generally vest over a period of three or four years with one-third or one-fourth of the units vesting, respectively, on each anniversary date of the grant date. RSU grants to directors generally vest over a period of one year with one-twelfth of the units vesting each month. The aggregate fair value of our RSU grants is amortized to compensation expense over the applicable vesting period. We grant PSUs to our executive officers. At the time of grant, we calculate the fair value of our PSUs using the Monte-Carlo simulation. We incorporate the following variables into the valuation model: For the Year Ended April 30, 2024 2023 2022 Grant date fair market value Smith & Wesson Brands, Inc $ 12.08 $ 14.19 $ 18.67 Russell 2000 Index $ 1,769.21 $ 2,015.04 $ 2,277.45 Volatility (a) Smith & Wesson Brands, Inc 58.46 % 64.77 % 62.33 % Russell 2000 Index 27.08 % 31.75 % 30.69 % Correlation coefficient (b) 0.3528 0.2094 0.1540 Risk-free interest rate (c) 3.81 % 2.91 % 0.33 % Dividend yield 3.31 % 2.26 % 1.07 % (a) Expected volatility is calculated over the most recent period that represents the remaining term of the performance period as of the valuation date, or three years . (b) The correlation coefficient utilizes the same historical price data used to develop the volatility assumptions. (c) The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bill, commensurate with the three-year performance period. The PSUs vest, and the fair value of such PSUs are recognized, over the corresponding three-year performance period. Our PSUs have a maximum aggregate award equal to 200 % of the target amount granted. Generally, the number of PSUs that may be earned depends upon the total stockholder return, or TSR, of our common stock compared with the TSR of the Russell 2000 Index, or RUT, over the three-year performance period. For PSUs, our stock must outperform the RUT by 5 % in order for the target award to vest. In addition, there is a cap on the number of shares that can be earned under our PSUs, which is equal to six times the grant-date value of each award. In connection with the spin-off of AOUT and in accordance with the terms of the Employee Matters Agreement between us and AOUT, all outstanding PSU awards were adjusted such that the performance criteria relative to SWBI share price was modified to compare the market cap of SWBI for the 90 days subsequent to the original grant date to the combined market cap of SWBI and AOUT for the 90 days preceding the original vest date. The change in the market cap will be compared to the change in the value of the Russell 2000 index for the same period. In addition, a pro rata number of AOUT PSUs were granted at the time of the spin to each SWBI PSU recipient with the same terms as the underlying original SWBI PSU. In certain circumstances, the vested awards will be delivered on the first anniversary of the applicable vesting date. We have applied a discount to the grant date fair value when determining the amount of compensation expense to be recorded for these RSUs and PSUs. During fiscal 2024, we granted 176,583 PSUs to certain of our executive officers. We also granted 357,357 service-based RSUs during fiscal 2024, including 117,724 RSUs to certain of our executive officers, 58,819 RSUs to our directors, and 180,814 RSUs to non-executive officer employees. During fiscal 2024, we canceled 158,100 market-condition PSUs as a result of the failure to satisfy the performance metric. We canceled 24,385 service-based RSUs as a result of the service period condition not being met. We delivered 228,087 shares of common stock to current employees and directors under vested RSUs with a total market value of $ 2.7 million. In addition, in connection with a 2019 grant, which vested in fiscal 2023, we delivered 55,726 market-condition PSUs to certain of our executive officers and a former executive officer with a total market value of $ 664,000 . During fiscal 2023, we granted 108,736 PSUs to certain of our executive officers. We also granted 287,854 service-based RSUs during fiscal 2023, including 72,494 RSUs to certain of our executive officers, 56,497 RSUs to our directors, and 158,863 RSUs to non-executive officer employees. During fiscal 2023, we canceled 35,179 service-based RSUs as a result of the service period condition not being met. We delivered 202,859 shares of common stock to current employees under vested RSUs with a total market value of $ 2.7 million. In addition, in connection with a 2018 grant, which vested in fiscal 2022, we delivered 83,586 market-condition PSUs to certain of our executive officers and a former executive officer with a total market value of $ 1.2 million. In addition, in connection with a 2019 grant, 57,600 PSUs vested to certain of our executive officers and a former executive officer, which resulted from achieving the maximum performance of 200.0 % of target for the original 28,800 PSUs granted. Relating to this same grant, 1,874 shares were released to cover tax obligations on the vesting. During fiscal 2022, we granted 73,913 PSUs to certain of our executive officers and a former executive officer. We also granted 184,767 service-based RSUs during fiscal 2022, including 65,518 RSUs to certain of our executive officers and a former executive officer, 42,702 RSUs to our directors, and 76,547 RSUs to non-executive officer employees. During fiscal 2022, we canceled 45,249 service-based RSUs as a result of the service period condition not being met. We canceled 40,869 PSUs as a result of the service period condition not being met. We delivered 365,736 shares of common stock to current employees under vested RSUs with a total market value of $ 7.5 million. In addition, in connection with a 2018 grant, we vested 86,400 market-condition PSUs to certain of our executive officers and a former executive officer, which resulted from achieving the maximum performance of 200.0 % of target for the original 43,200 PSUs granted. Related to this same grant, we released 2,814 market-condition PSUs to cover tax obligations as a result of the vesting. The grant date fair value of RSUs and PSUs that vested in fiscal 2024, 2023, and 2022 was $ 3.3 million, $ 4.0 million, and $ 4.4 million, respectively. A summary of activity for unvested RSUs and PSUs for fiscal years 2024, 2023, and 2022 is as follows: For the Year Ended April 30, 2024 2023 2022 Weighted Weighted Weighted Total # of Average Total # of Average Total # of Average Restricted Grant Date Restricted Grant Date Restricted Grant Date Stock Units Fair Value Stock Units Fair Value Stock Units Fair Value RSUs and PSUs outstanding, beginning of period 932,705 $ 13.14 830,813 $ 13.30 995,879 $ 11.14 Awarded 533,940 12.07 425,390 (a) 13.52 301,880 18.95 Released ( 283,813 ) (b) 11.54 ( 288,319 ) 13.92 ( 368,550 ) 11.99 Forfeited ( 182,485 ) 10.83 ( 35,179 ) 15.17 ( 98,396 ) 12.29 RSUs and PSUs outstanding, end of period 1,000,347 $ 13.45 932,705 $ 13.14 830,813 $ 13.30 _____________________ (a) Includes 28,800 PSUs that vested during the fiscal year in connection with achieving maximum performance targets for the 2019 grants. (b) Includes 55,726 PSUs that vested during fiscal 2023. As of April 30, 2024, there was $ 3.8 million of unrecognized compensation cost related to unvested RSUs and PSUs. This cost is expected to be recognized over a weighted average remaining contractual term of 1.3 years. We had an ESPP that commenced on September 26, 2011, or the 2011 ESPP, which authorized the sale of up to 6,000,000 of our common stock to employees. The 2011 ESPP continued in effect for a term of 10 years and expired with the offering period that ended March 31, 2022. All options and rights to participate in the 2011 ESPP are nontransferable and subject to forfeiture in accordance with the 2011 ESPP guidelines. As of April 30, 2022, we had issued 1,948,334 shares of common stock under the 2011 ESPP, all of which were purchased prior to April 30, 2022. During fiscal 2022, 128,422 shares were purchased under the 2011 ESPP, respectively. On September 27, 2021, our stockholders approved our 2021 ESPP, which authorizes the sale of up to 3,000,000 shares of our common stock to employees. All options and rights to participate in our ESPP are nontransferable and subject to forfeiture in accordance with our ESPP guidelines. Our current ESPP will be implemented in a series of successive offering periods, each with a maximum duration of 12 months. If the fair market value, or FMV, per share of our common stock on any purchase date is less than the FMV per share on the start date of a 12-month offering period, then that offering period will automatically terminate, and a new 12-month offering period will begin on the next business day. Each offering period will begin on April 1 or October 1, as applicable, immediately following the end of the previous offering period. Payroll deductions will be on an after-tax basis, in an amount of not less than 1 % and not more than 20 % (or such greater percentage as the committee appointed to administer our ESPP may establish from time to time before the first day of an offering period) of a participant’s compensation on each payroll date. The option exercise price per share will equal 85 % of the lower of the FMV on the first day of the offering period or the FMV on the exercise date. The maximum number of shares that a participant may purchase during any purchase period is 12,500 shares, or a total of $ 25,000 in shares, based on the FMV on the first day of the offering period. Our ESPP will remain in effect until the earliest of (a) the exercise date that participants become entitled to purchase a number of shares greater than the number of reserved shares available for purchase under our ESPP, (b) such date as is determined by our board of directors in its discretion, or (c) March 31, 2022. In the event of certain corporate transactions, each option outstanding under our ESPP will be assumed or an equivalent option will be substituted by the successor corporation or a parent or subsidiary of such successor corporation. During fiscal 2024 and 2023, 151,225 and 175,047 shares were purchased under the 2021 ESPP, respectively. We measure the cost of employee services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. We calculate the fair value of our stock options issued to employees using the Black-Scholes model at the time the options were granted. That amount is then amortized over the vesting period of the option. With our ESPP, fair value is determined at the beginning of the purchase period and amortized over the term of each exercise period. The following assumptions were used in valuing our ESPP purchases during the years ended April 30, 2024, 2023, and 2022: For the Year Ended April 30, 2024 2023 2022 Risk-free interest rate 5.225 % 4.301 % 0.682 % Expected term 6 months 6 months 6 months Expected volatility 45.69 % 49.18 % 60.62 % Dividend yield 3.27 % 3.59 % 1.85 % We estimate expected volatility using historical volatility for the expected term. The fair value of each stock option or ESPP purchase was estimated on the date of the grant using the Black-Scholes option pricing model (using the risk-free interest rate, expected term, expected volatility, and dividend yield variables, as noted in the above table). The total stock-based compensation expense, including stock options, purchases under our ESPP, and RSU and PSU awards, was $ 5.7 million, $ 5.1 million, and $ 4.5 million, for fiscal years 2024, 2023, and 2022, respectively. |
Employer Sponsored Benefit Plan
Employer Sponsored Benefit Plans | 12 Months Ended |
Apr. 30, 2024 | |
Retirement Benefits [Abstract] | |
Employer Sponsored Benefit Plans | 13. Employer Sponsored Benefit Plans Contributory Defined Investment Plan — We offer two contributory defined investment plans covering substantially all employees, subject to service requirements. Employees may contribute up to 100 % of their annual pay, depending on the plan. We generally make discretionary matching contributions of up to 50 % of the first 6 % of employee contributions to the plan. We contributed $ 2.7 million, $ 2.6 million, and $ 2.9 million for the fiscal years ended April 30, 2024, 2023, and 2022, respectively. Nonelective Contribution Sharing Plan — We have a non-contributory profit sharing plan covering substantially all of our employees. Employees become eligible on May 1 following the completion of a full fiscal year of continuous service. Our contributions to the plan are discretionary. For fiscal 2024, we plan to contribute approximately $ 9.1 million, which has been recorded in general and administrative costs. We contributed $ 8.2 million and $ 13.5 million for the fiscal years ended April 30, 2023 and 2022, respectively. Contributions are funded after the fiscal year-end. |
Income Taxes
Income Taxes | 12 Months Ended |
Apr. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 14. Income Taxes Income tax expense/(benefit) from continuing operations consisted of the following (in thousands): For the Year Ended April 30, 2024 2023 2022 Current: Federal $ 6,315 $ 16,259 $ 52,843 State 2,637 1,955 7,174 Total current 8,952 18,214 60,017 Deferred: Federal 2,558 ( 6,217 ) ( 1,889 ) State ( 1,723 ) ( 647 ) ( 236 ) Total deferred 835 ( 6,864 ) ( 2,125 ) Total income tax expense $ 9,787 $ 11,350 $ 57,892 The following table presents a reconciliation of income tax expense from continuing operations at the statutory rate of 21 % to the expense/(benefit) in the consolidated financial statements (in thousands): For the Year Ended April 30, 2024 2023 2022 Federal income taxes expected at the statutory rate $ 10,373 $ 10,127 $ 53,001 State income taxes, net of federal tax effects ( 225 ) 1,023 5,503 Stock compensation 467 136 ( 749 ) Business meals and entertainment 100 89 118 Research and development tax credit ( 281 ) ( 265 ) ( 300 ) Amendments to prior year returns ( 1,176 ) — — Other 529 240 319 Total income tax expense $ 9,787 $ 11,350 $ 57,892 Deferred tax assets and liabilities related to temporary differences consisted of the following (in thousands): For the Years Ended April 30, 2024 2023 Deferred Tax Assets Inventory reserves $ 8,489 $ 7,495 Accrued expenses, including compensation 4,678 4,764 Net operating loss carryforwards and tax credits 3,988 3,156 Operating lease liability 240 473 Product liability 191 596 Workers' compensation 704 477 State bonus depreciation 1,812 755 Warranty reserve 1,017 913 Stock-based compensation 1,319 1,551 Section 174 capitalized R&D expense 2,502 1,549 Other 820 622 Total deferred tax assets before valuation allowance 25,760 22,351 Valuation allowance ( 3,350 ) ( 3,031 ) Net deferred tax assets 22,410 19,320 Deferred Tax Liabilities Operating lease right-of-use assets ( 197 ) ( 420 ) Property, plant & equipment ( 12,426 ) ( 8,847 ) Intangible assets ( 2,270 ) ( 1,581 ) Other ( 268 ) ( 387 ) Total deferred tax liabilities ( 15,161 ) ( 11,235 ) Net Deferred Tax Asset/(Liability) $ 7,249 $ 8,085 We had no federal net operating losses as of April 30, 2024. We had $ 27.1 million and $ 17.7 million in state net operating loss carryforwards as of April 30, 2024 and 2023, respectively. The state net operating loss carryforwards will expire between April 30, 2027 and April 30, 2040 . We had $ 3.3 million and $ 2.8 million of state tax credit carryforwards as of April 30, 2024 and 2023, respectively. Certain state tax credit carryforwards will expire by April 30, 2049 , with others having no expiration date. As of April 30, 2024 and 2023, valuation allowances related to our deferred tax assets for state net operating loss carryforwards were $ 1.4 million and $ 957,000 , respectively, and $ 1.9 million and $ 2.2 million were provided on our deferred tax assets for state tax credits, respectively, that we do not anticipate using prior to expiration. The income tax provisions represent effective tax rates of 19.8 % and 23.5 % for fiscal 2024 and 2023, respectively. With limited exception, we are subject to U.S. federal, state, and local income tax audits by tax authorities for fiscal years subsequent to April 30, 2019. At April 30, 2024 and 2023, we have no t recorded any unrecognized tax benefits. We maintain an accounting policy of recording interest and penalties, if applicable, related to uncertain tax positions as a component of income taxes. As of April 30, 2024 and 2023, there were no interest and penalties accrued. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Apr. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 15. Commitments and Contingencies Litigation In January 2018, Gemini Technologies, Incorporated, or Gemini, commenced an action against us in the U.S. District Court for the District of Idaho, or the District Court. The complaint alleges, among other things, that we breached the earn-out and other provisions of the asset purchase agreement and ancillary agreements between the parties in connection with our acquisition of the Gemtech business from Gemini. The complaint seeks a declaratory judgment interpreting various terms of the asset purchase agreement and damages in the sum of $ 18.6 million. In November 2019, we filed an answer to Gemini’s complaint and a counterclaim against Gemini and its stockholders at the time of the signing of the asset purchase agreement. Plaintiffs amended their complaint to add a claim of fraud in the inducement. In September 2021, Gemini filed a motion for summary judgment seeking to dismiss our counterclaim. In June 2022, the District Court denied Gemini's motion for summary judgment. Gemini filed a second motion for summary judgment, and on August 14, 2023, the District Court again denied Gemini’s motion. On November 22, 2023, we entered into a settlement agreement with plaintiffs on the indemnity and counterclaims. On the same day, plaintiffs filed a motion for leave, seeking to file a second amended complaint. On January 31, 2024, the District Court allowed plaintiffs’ amended allegations of fraud, and denied without prejudice their motion to add punitive damages. We believe the claims asserted in the complaint have no merit, and we intend to aggressively defend this action. We are a defendant in one product liability case and are aware of five other product liability claims, primarily alleging defective product design, defective manufacturing, or failure to provide adequate warnings. In addition, we are a co-defendant in a case filed in August 1999 by the city of Gary, Indiana, or the City, against numerous firearm manufacturers, distributors, and dealers seeking to recover monetary damages, as well as injunctive relief, allegedly arising out of the misuse of firearms by third parties. In January 2018, the Lake Superior Court, County of Lake, Indiana granted defendants’ Motion for Judgment on the Pleadings, dismissing the case in its entirety. In February 2018, plaintiffs appealed the dismissal to the Indiana Court of Appeals. In May 2019, the Indiana Court of Appeals issued a decision, which affirmed in part and reversed in part, and remanded for further proceedings, the trial court’s dismissal of the City’s complaint. In July 2019, defendants filed a Petition to Transfer jurisdiction to the Indiana Supreme Court. In November 2019, the Indiana Supreme Court denied defendants' petition to transfer, and the case was returned to the trial court. Discovery remains ongoing. On March 15, 2024, Governor Holcomb signed House Enrolled Act No. 1235 into law. On March 18, 2024, defendants filed a joint motion for judgment on the pleadings based on the new legislation. On May 17, 2024, plaintiffs filed an opposition to defendants’ motion for judgment on the pleadings. A hearing on defendants’ motion is scheduled for July 25, 2024. We are a defendant in a putative class proceeding before the Ontario Superior Court of Justice in Toronto, Canada that was filed in December 2019 . The action claims CAD$ 50 million in aggregate general damages, CAD$ 100 million in aggregate punitive damages, special damages in an unspecified amount, together with interest and legal costs. The named plaintiffs are two victims of a shooting that took place in Toronto in July 2018 and their family members. One victim was shot and injured during the shooting. The other victim suffered unspecified injuries while fleeing the shooting. The plaintiffs are seeking to certify a claim on behalf of classes that include all persons who were killed or injured in the shooting and their immediate family members. The plaintiffs allege negligent design and public nuisance. The case has not been certified as a class action. In July 2020, we filed a Notice of Motion for an order striking the claim and dismissing the action in its entirety. In February 2021, the court granted our motion in part, and dismissed the plaintiffs’ claims in public nuisance and strict liability. The court declined to strike the negligent design claim and ordered that the claim proceed to a certification motion. In March 2021, we filed a motion for leave to appeal the court’s refusal to strike the negligent design claim with the Divisional Court, Ontario Superior Court of Justice. In July 2021, plaintiffs filed a motion to stay our motion for leave to appeal with the Divisional Court, on grounds that appeal is premature. In November 2021, the Divisional Court granted plaintiffs' motion, staying our motion for leave to appeal until 30 days after the decision on the balance of plaintiffs' certification motion. A hearing on plaintiffs’ certification motion was held in January 2024. On March 5, 2024, the court denied the plaintiffs' motion for class certification. Three appeals have now been filed, appealing from the decisions issued to date in the case. All three appeals will be heard together in the Court of Appeal for Ontario. Those three appeals are: (1) our appeal from the dismissal of our motion to strike the negligent design claim; (2) the plaintiffs’ appeal from the order striking out their public nuisance and strict liability claims; and, (3) the plaintiffs’ appeal from the order dismissing their certification motion. In May 2020, we were named in an action related to the Chabad of Poway synagogue shooting that took place in April 2019. The complaint was filed in the Superior Court of the State of California, for the County of San Diego – Central, and asserts claims against us for product liability, unfair competition, negligence, and public nuisance. The plaintiffs allege they were present at the synagogue on the day of the incident and suffered physical and/or emotional injury. The plaintiffs seek compensatory and punitive damages, attorneys’ fees, and injunctive relief. In September 2020, we filed a demurrer and motion to strike, seeking to dismiss plaintiffs’ complaint. In July 2021, the court granted our motion in part, and reversed it in part, ruling that (1) the PLCAA barred plaintiffs’ product liability action; (2) plaintiffs did not have standing to maintain an action under the Unfair Competition Law for personal injury related damages, but gave plaintiffs leave to amend to plead an economic injury; and (3) the PLCAA did not bar plaintiffs’ ordinary negligence and public nuisance actions because plaintiffs had alleged that we violated 18 U.S.C. Section 922(b)(4), which generally prohibits the sale of fully automatic “machineguns.” In August 2021, we filed a Petition for Writ of Mandate in the Court of Appeal of the State of California, Fourth Appellate District, Division One. In September 2021, the Court of Appeal denied our appeal. In February 2022, the court consolidated the case with three related cases, in which we are not a party. In March 2022, the court granted our motion, dismissing plaintiffs’ Unfair Competition Law claim, without further leave to amend. Discovery is ongoing. On February 28, 2023, we filed a motion for summary judgment. On May 19, 2023, the court denied our motion for summary judgment without prejudice and allowed plaintiffs time for additional, limited discovery. A hearing on our renewed motion for summary judgment was held on June 17, 2024, and trial has been rescheduled to January 24, 2025. We are a defendant in an action filed in the U.S. District Court for the District of Massachusetts. In August 2021, the Mexican Government filed an action against several U.S.-based firearms manufacturers and a firearms distributor, claiming defendants design, market, distribute, and sell firearms in ways they know routinely arm the drug cartels in Mexico. Plaintiff alleges, among other claims, negligence, public nuisance, design defect, unjust enrichment and restitution against all defendants and violation of the Massachusetts Consumer Protection Act against us alone, and is seeking monetary damages and injunctive relief. In November 2021, defendants filed motions to dismiss plaintiff's complaint. In September 2022, the district court granted defendants’ motions to dismiss. In October 2022, plaintiff filed a notice of appeal with the U.S. Court of Appeals for the First Circuit. On January 22, 2024, the First Circuit reversed the trial court’s dismissal of the case. On April 18, 2024, defendants filed a Petition for a Writ of Certiorari with the Supreme Court of the United States. In September 2022, we were named as defendants in 12 nearly identical, separate actions related to a shooting in Highland Park, Illinois on July 4, 2022. The complaints were filed in the Circuit Court of the Nineteenth Judicial Circuit in Lake County, Illinois and assert claims against us for negligence and deceptive and unfair practices under the Illinois Consumer Fraud and Deceptive Business Practices Act. Plaintiffs also name as defendants the website and retailer that sold the firearm, the shooter, and the shooter’s father. The plaintiffs allege they were present at a parade at the time of the incident and suffered physical and/or emotional injury. The plaintiffs seek compensatory damages, attorneys’ fees, and injunctive relief. We filed motions for removal of each case to the U.S. District Court for the Northern District of Illinois. In November 2022, we filed a motion to consolidate the cases for preliminary motion purposes. In December 2022, plaintiffs filed motions to remand the cases back to the state court. On January 20, 2023, we filed our opposition to plaintiffs’ motion to remand. On September 25, 2023, the court granted plaintiffs’ motion to remand. On October 16, 2023, we filed a notice of appeal to the U.S. Court of Appeals for the Seventh Circuit. On October 20, 2023, we filed a Motion for Stay of the Remand Order with the U.S. District Court, seeking a stay of the remand, pending our appeal to the Seventh Circuit. On October 30, 2023, the court granted a stay of the remand pending appeal. On November 8, 2023, plaintiffs filed a motion to lift the stay pending appeal. No decision has been issued to date on plaintiffs’ motion. We filed our reply to appellee's opposition to our appeal on February 23, 2024. In March 2024, three new suits were filed in the Circuit Court of Lake County, Illinois. On April 8, 2024, the Seventh Circuit affirmed the remand decision. On May 10, 2024, plaintiffs filed a motion for attorneys’ fees incurred as a result of removal. On May 17, 2024, we filed an opposition to plaintiffs’ motion. No decision has been issued to date. In December 2022, the City of Buffalo, New York filed a complaint in the Supreme Court of the State of New York, County of Erie, against numerous manufacturers, distributors, and retailers of firearms. Later in December 2022, the City of Rochester, New York filed an almost identical complaint in the Supreme Court of the State of New York, County of Monroe, against the same defendants. The complaints allege violation of New York General Business Law, public nuisance, and deceptive business practices in violation of NY General Business Laws. In January 2023, we filed notices of removal of the cases to the U.S. District Court for the Western District of New York. On March 24, 2023, defendants filed a motion to stay both cases pending a ruling by the U.S. Court of Appeals for the Second Circuit in the NSSF v. James case. On June 8, 2023, the court granted defendants’ motions to consolidate and to stay pending resolution of the NSSF v. James appeal. We believe that the various allegations as described above are unfounded, and, in addition, that any incident and any results from them or any injuries were due to negligence or misuse of the firearm by the claimant or a third party. In March 2022, two plaintiffs, on behalf of a proposed class of current and former employees and temporary workers who worked at our Springfield facility from November 2018 to the present, filed a claim alleging non-payment of wages and overtime in violation of the Massachusetts Wage Act and Massachusetts Fair Wage Act. The parties have reached a settlement agreement, which was preliminarily approved by the court on March 15, 2024. In addition, from time to time, we are involved in lawsuits, claims, investigations, and proceedings, including commercial, environmental, premises and employment matters, which arise in the ordinary course of business. The relief sought in individual cases primarily includes compensatory and, sometimes, punitive damages. Certain of the cases and claims seek unspecified compensatory or punitive damages. In others, compensatory damages sought may range from less than $ 75,000 to approximately $ 50.0 million. In our experience, initial demands do not generally bear a reasonable relationship to the facts and circumstances of a particular matter. We believe that our accruals for product liability cases and claims are a reasonable quantitative measure of the cost to us of product liability cases and claims. We were also involved in a putative stockholder derivative lawsuit filed on December 5, 2023 in the Eighth Judicial District Court, Clark County, Nevada. The action was brought by plaintiffs seeking to act on our behalf against our directors and certain of our executive officers. The complaint alleged breach of fiduciary duties by knowingly allowing us to become exposed to significant liability for intentionally violating federal, state, and local laws through our manufacturing, marketing, and sale of “AR-15 style rifles”. The derivative plaintiffs sought damages on our behalf from the individual defendants, as well as reforms and improvements to our compliance procedures and governance policies. On March 19, 2024, the court granted our motion to require security pursuant to Nevada law. On May 6, 2024, the court dismissed plaintiffs’ action without prejudice for failing to post a bond pursuant to the court’s order. We are vigorously defending ourselves in the lawsuits to which we are subject. An unfavorable outcome or prolonged litigation could harm our business. Litigation of this nature also is expensive, time consuming, and diverts the time and attention of our management. We monitor the status of known claims and the related product liability accrual, which includes amounts for defense costs for asserted and unasserted claims. After consultation with litigation counsel and a review of the merit of each claim, we have concluded that we are unable to reasonably estimate the probability or the estimated range of reasonably possible losses related to material adverse judgments related to such claims and, therefore, we have not accrued for any such judgments. In the future, should we determine that a loss (or an additional loss in excess of our accrual) is at least reasonably possible and material, we would then disclose an estimate of the possible loss or range of loss, if such estimate could be made, or disclose that an estimate could not be made. We believe that we have provided adequate accruals for defense costs. For the fiscal years ended April 30, 2024, 2023, and 2022, we paid $ 320,000 , $ 988,000 , and $ 729,000 , respectively, in defense and administrative costs relative to product liability and municipal litigation. In addition, during fiscal 2024 and 2023, we paid an aggregate of $ 1.6 million and $ 1.5 million, respectively, in settlements related to product liability cases. During fiscal 2022, we made no payments related to settlements for product liability cases. As of April 30, 2024 we had no amounts accrued for settlements, that were subsequently paid. As of April 30, 2023, we had $ 1.6 million accrued for settlements that were subsequently paid. We have recorded our liability for defense costs before consideration for reimbursement from insurance carriers. We have also recorded the amount due as reimbursement under existing policies from the insurance carriers as a receivable shown in other current assets and other assets. When changes to our prior estimates of product liability provisions and municipal litigation liabilities are warranted, we recognize additional expense or reductions in expense. In fiscal 2024, 2023, and 2022, we recorded additional expense of $ 35,000 , $ 176,000 , and $ 1.2 million, respectively. Commitments On September 30, 2021, we announced our plan to move our headquarters and significant elements of our operations to Maryville, Tennessee in 2023, or the Relocation. In connection with the Relocation, we entered into a project agreement, or the Project Agreement, with The Industrial Development Board of Blount County and the cities of Alcoa and Maryville, Tennessee, a public, nonprofit corporation organized and existing under the laws of the state of Tennessee, or the IDB. Pursuant to the Project Agreement, we represented to the IDB that we intend to incur, or cause to be incurred, no less than $120.0 million in aggregate capital expenditures on or before December 31, 2025, create no less than 620 new jobs, and sustain an average hourly wage of at least $ 25.97 at the facility. Further, pursuant to the Project Agreement, we are required to, among other things, (A) execute a facility lease and an equipment lease with the IDB; (B) cause the construction of the new facility at our sole cost and expense to commence on or before May 31, 2022; (C) incur, or cause to be incurred, aggregate capital expenditures in connection with the construction and equipping of the new facility in an aggregate amount of not less than $ 120.0 million on or before December 31, 2025; (D) cause the construction of the new facility to be substantially completed and for a certificate of occupancy to be issued therefore on or before December 31, 2023; (E) provide the IDB with a written report certified by one of our authorized officers, not later than January 31 of each year during the period between January 31, 2024 and January 31, 2031; and (F) make certain payments to IDB in the event that our actual capital expenditures, number of employees, or average hourly wage of such employees are less than our projections. On February 2, 2023, we entered into a design-build agreement with The Christman Company, or Christman, related to the construction of our new Tennessee facility, or the Construction Contract. The Construction Contract has an effective date of September 13, 2021 and incorporates the arrangements under which we and Christman have been proceeding. Pursuant to the Construction Contract, Christman is obligated to deliver certain services, including, among others, design phase services and construction phase services, and we are obligated to pay Christman for services performed. The parties to the Construction Contract have jointly agreed that Christman will perform and complete the Work (as defined therein) on a cost-plus basis for a guaranteed maximum price of $ 114.0 million, including contingencies. When adding the cost of machinery and equipment, we expect to spend between $ 160.0 million and $ 170.0 million through the end of fiscal 2025. Through April 30, 2024, we had incurred $ 157.0 million of capital expenditures related to the Relocation. The Construction Contract includes terms that are customary for contracts of this type, including with respect to indemnification and insurance. The Construction Contract lists certain contract milestones and guaranteed completion dates, and we will be entitled to liquidated damages under certain circumstances. Each party to the Construction Contract is entitled to terminate the Construction Contract under certain circumstances. As part of the Relocation, we recorded an impairment of $ 1.9 million relating to equipment in the Missouri Distribution Center that we do not expect to utilize in the Tennessee facility nor recover the net book value in a sale of the asset. In addition, effective with the Assignment and Assumption Agreement, we vacated the Missouri Distribution Center effective January 1, 2024. We sold assets we could no longer utilize to AOUT at their remaining net book value of $ 2.9 million and relocated the remaining assets to our Tennessee facility. In addition, we intend to relocate a portion of our plastic injection molding operations to the Tennessee facility. The relocation of these assets began in our second fiscal quarter of 2024. We are evaluating selling the remaining molding operations utilized in our Connecticut facility to a third party. As of April 30, 2024, most of the plastic injection molding machinery and equipment was being utilized, had been relocated to the Tennessee facility, or had been disposed. We do not believe there are any indications of impairment relating to assets being utilized at the Deep River facility. Environmental Remediation We are subject to numerous federal, state, and local laws and regulations that regulate the health and safety of our workforce, including those regulations monitored by the Occupational Health and Safety Administration, or OSHA, the National Fire Protection Association, and the Department of Public Health. Though not exhaustive, examples of applicable regulations include confined space safety, walking and working surfaces, machine guarding, and life safety. We are also subject to numerous federal, state, and local environmental laws and regulations concerning, among other things, emissions in the air; discharges to land, surface, subsurface strata and water; and the generation, handling, storage, transportation, treatment, and disposal of hazardous wastes and other materials. These laws have required us to make significant expenditures of both a capital and expense nature. Several of the more significant federal laws applicable to our operations include the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA, and the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act. We have in place programs and personnel to monitor compliance with various federal, state, and local environmental regulations. In the normal course of our manufacturing operations, we are subject to governmental proceedings and orders pertaining to waste disposal, air emissions, and water discharges into the environment. We fund our environmental costs through cash flows from operations. We believe that we are in compliance with applicable environmental regulations in all material respects. We are required to remediate hazardous waste at our facilities. Currently, we own a designated site in Springfield, Massachusetts that contains two release areas, which are the focus of remediation projects as part of the Massachusetts Contingency Plan, or MCP. The MCP provides a structured environment for the voluntary remediation of regulated releases. We may be required to remove hazardous waste or remediate the alleged effects of hazardous substances on the environment associated with past disposal practices at sites not owned by us. We have received notice that we are a potentially responsible party from the Environmental Protection Agency and/or individual states under CERCLA or a state equivalent at two sites. As of April 30, 2024, and 2023, we did no t have an open environmental reserve recorded in our consolidated balance sheet. When the available information is sufficient to estimate the amount of liability, that estimate has been used. When the information is only sufficient to establish a range of probable liability and no point within the range is more likely than any other, the lower end of the range has been used. We may not have insurance coverage for our environmental remediation costs. We have not recognized any gains from probable recoveries or other gain contingencies. Based on information known to us, we do not expect current environmental regulations or environmental proceedings and claims to have a material adverse effect on our consolidated financial position, results of operations, or cash flows. However, it is not possible to predict with certainty the impact on us of future environmental compliance requirements or the cost of resolving of future environmental health and safety proceedings and claims, in part because the scope of the remedies that may be required is not certain, liability under federal environmental laws is joint and several in nature, and environmental laws and regulations are subject to modification and changes in interpretation. There can be no assurance that additional or changing environmental regulation will not become more burdensome in the future and that any such development would not have a material adverse effect on our company. Contracts Employment Agreements — We have employment, severance, and change of control agreements with certain employees. |
Restructuring
Restructuring | 12 Months Ended |
Apr. 30, 2024 | |
Restructuring Costs [Abstract] | |
Restructuring | 16. Restructuring As a result of the Relocation, $ 7.1 and $ 8.3 million of restructuring charges were recorded in fiscal 2024 and fiscal 2023, respectively. The following table summarizes restructuring charges by line item for fiscal 2024 and fiscal 2023 (in thousands): For the Year Ended April 30, 2024 2023 Cost of sales $ 2,116 $ 3,923 Research and development — 3 Selling, marketing, and distribution 2,974 1,055 General and administrative 1,963 3,280 Total restructuring charges $ 7,053 $ 8,261 The components of the restructuring charges recorded in our consolidated statements of income are as follows (in thousands): For the Year Ended April 30, 2024 2023 Office rent and equipment $ 2,298 $ 229 Employee relations 2,011 349 Consulting services 992 473 Public relations 904 — Relocation (a) 887 2,856 Freight 199 — Severance and employee-related benefits (a) ( 238 ) 4,354 Total restructuring charges $ 7,053 $ 8,261 ____________________________________ (a) Recorded in accrued payroll and incentives The following table summarizes the activity in the severance and employee-related benefits and relocation accruals for fiscal 2024 and fiscal 2023 (in thousands): Severance and employee-related benefits Relocation Total Accrual at April 30, 2023 $ 10,054 $ 1,746 $ 11,800 Charges ( 238 ) 887 649 Cash payments and settlements ( 4,289 ) ( 1,805 ) ( 6,094 ) Accrual at April 30, 2024 (a) $ 5,527 $ 828 $ 6,355 ___________________________________ (a) Recorded in accrued payroll and incentives |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Apr. 30, 2024 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the financial statement dates and the reported amounts of revenue and expenses during the reporting periods. Our significant estimates include the accrual for warranty, reserves for excess and obsolete inventory, rebates and other promotions, valuation of intangible assets, and costs associated with the Relocation. Actual results could differ from those estimates. |
Principles of Consolidation | Principles of Consolidation — The accompanying consolidated financial statements include the accounts of Smith & Wesson Brands, Inc. and its wholly owned subsidiaries, including Smith & Wesson Inc., Smith & Wesson Sales Company, and SWPC Plastics, LLC. In our opinion, all adjustments, which include only normal recurring adjustments necessary to fairly present the financial position, results of operations, changes in stockholders’ equity, and cash flows at April 30, 2024 and 2023 and for the periods presented, have been included. All intercompany accounts and transactions have been eliminated in consolidation. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments — Unless otherwise indicated, the fair values of all reported assets and liabilities, which represent financial instruments not held for trading purposes, approximate the carrying values of such amounts because of their short-term nature or market rates of interest. |
Cash and Cash Equivalents | Cash and Cash Equivalents — We consider all highly liquid investments purchased with original maturities of three months or less at the date of acquisition to be cash equivalents. We maintain our cash in bank deposit accounts that, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. As of April 30, 2024, all of our accounts exceeded federally insured limits. |
Financial Instruments | Financial Instruments — We account for derivative instruments under Accounting Standards Codification (“ASC”) 815-10, Fair Value Measurements and Disclosure Topic , which establishes accounting and reporting standards for derivative instruments and hedging activities and requires us to recognize these instruments as either assets or liabilities on the balance sheet and measure them at fair value. As of April 30, 2024 and 2023, we did no t have any derivative instruments or any Level 2 or Level 3 financial instruments within the hierarchy. See Note 4 – Notes, Loans Payable, and Financing Arrangements for more information regarding our financial instruments. |
Trade Receivables | Trade Receivables — We extend credit to our domestic customers and some foreign distributors based on their financial condition. We sometimes offer discounts for early payment on invoices. When we believe the extension of credit is not advisable, we rely on either a prepayment or a letter of credit. We write off balances deemed uncollectible by us against our allowance for doubtful accounts. We estimate our allowance for doubtful accounts through current past due balances, knowledge of our customers’ financial situations, and past payment history. |
Concentrations of Credit Risk | Concentrations of Credit Risk — Financial instruments that potentially subject us to concentration of credit risk consist principally of cash, cash equivalents, and trade receivables. We place our cash and cash equivalents in overnight U.S. government securities. Concentrations of credit risk with respect to trade receivables are limited by the large number of customers comprising our customer base and their geographic and business dispersion. We perform ongoing credit evaluations of our customers’ financial condition and generally do not require collateral. For fiscal 2024, sales to three of our customers exceeded 10.0 % of our net sales, totaling 34.8 %. As of April 30, 2024, two of our customers each accounted for more than 10 % of our accounts receivable, for a total of 47.9 %. For fiscal 2023, sales to two of our customers exceeded 10.0 % of our net sales, totaling 22.8 %. As of April 30, 2023, three of our customers each accounted for more than 10 % of our accounts receivable, for a total of 39.4 %. |
Inventories | Inventories — We value inventories at the lower of cost, using the first-in, first-out, or FIFO, method or net realizable value. An allowance for potential non-saleable inventory due to excess stock or obsolescence is based upon a detailed review of inventory, past history, and expected future usage. |
Property, Plant, and Equipment | Property, Plant, and Equipment — We record property, plant, and equipment, consisting of land, building, improvements, machinery, equipment, software, hardware, furniture, and fixtures, at cost and depreciate them using the straight-line method over their estimated useful lives. We charge expenditures for maintenance and repairs to earnings as incurred, and we capitalize additions, renewals, and betterments. Upon the retirement or other disposition of property and equipment, we remove the related cost and accumulated depreciation from the respective accounts and include any gain or loss in operations. We lease certain of our real estate, machinery, and photocopiers under non-cancelable operating and finance lease agreements, and we recognize expenses under our operating lease assets and liabilities at the commencement date based on the present value of lease payments over the lease term. The depreciable life of assets and leasehold improvements are based on the expected life of the lease. A summary of the estimated useful lives is as follows: Description Useful Life Building and improvements 10 to 40 years Software and hardware 2 to 7 years Machinery and equipment 2 to 10 years We include tooling, dies, and fixtures as part of machinery and equipment and depreciate them over a period generally not exceeding ten years . |
Intangible Assets | Intangible Assets — We record intangible assets at cost or based on the fair value of the assets acquired. Intangible assets consist of developed technology, customer relationships, trademarks, trade names, and patents. We amortize intangible assets over their estimated useful lives or in proportion to expected yearly revenue generated from the intangibles that were acquired. |
Revenue Recognition | Revenue Recognition — We recognize revenue in accordance with the provisions of Accounting Standards Update, or ASU, Revenue from Contracts with Customers (Topic 606) , which became effective for us on May 1, 2018. Generally, all performance obligations are satisfied and revenue is recognized when the risks and rewards of ownership have transferred to the customer, which is generally upon shipment but could be delayed until the receipt of customer acceptance. In some instances, sales include multiple performance obligations. The most common of these instances relates to sales promotion programs under which customers are entitled to receive free goods based upon their purchase of our products, which we have identified as a material right. The fulfillment of these free goods is our responsibility. In such instances, we allocate the revenue of the promotional sales based on the estimated level of participation in the sales promotional program and the timing of the shipment of all of the products included in the promotional program, including the free goods. We recognize revenue related to the material right proportionally as each performance obligation is satisfied. The net change in contract liabilities for a given period is reported as an increase or decrease to sales. We generally sell our products free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 60 days of product shipment with a discount available to some customers for early payment. Generally, framework contracts define the general terms of sales, including payment terms, freight terms, insurance requirements, and cancelation provisions. Purchase orders define the terms for specific sales, including description, quantity, and price of each product purchased. We estimate variable consideration relative to the amount of cash discounts to which customers are likely to be entitled. As a result of utilizing practical expedients upon the adoption of ASC 606, we do not consider these extended terms to be a significant financing component of the contract because the payment terms are less than one year. In all cases, we consider our costs related to shipping and handling to be a cost of fulfilling the contract with the customer. |
Research and Development | Research and Development — We engage in both internal and external research and development, or R&D, in order to remain competitive and to exploit possible untapped market opportunities. We approve prospective R&D projects after analysis of the cost and benefits associated with the potential product. Costs in R&D expense include, among other items, salaries, materials, utilities, and administrative costs. |
Earnings/(Loss) per Share | Earnings per Share — We calculate basic and diluted earnings per common share in accordance with the provisions of ASC 260-10, Earnings Per Share . Basic earnings per common share equals net income divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share equals net income divided by the weighted average number of common shares outstanding during the period, including the effect of outstanding stock options and other stock-based instruments if their effect is dilutive. The following table provides a reconciliation of the net income amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings per common share (in thousands, except per share data): For the Year Ended April 30, 2024 2023 2022 Net income $ 39,609 $ 36,876 $ 194,494 Weighted average shares outstanding — Basic 45,813 45,844 47,227 Effect of dilutive stock awards 436 326 501 Weighted average shares outstanding — Diluted 46,248 46,170 47,728 Earnings per share — Basic $ 0.86 $ 0.80 $ 4.12 Earnings per share — Diluted $ 0.86 $ 0.80 $ 4.08 For fiscal 2024, 2023, and 2022, the number of shares excluded from the computation of diluted earnings per share was 18,009 , 30,307 , and 43,530 , respectively, because the effect would be antidilutive. |
Valuation of Long Lived Tangible and Intangible Assets | Valuation of Long-lived Tangible and Intangible Assets — We evaluate the recoverability of long-lived assets, or asset groups, whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. When such evaluations indicate that the related future undiscounted cash flows are not sufficient to recover the carrying values of the assets, such carrying values are reduced to fair value and this adjusted carrying value becomes the asset’s new cost basis. We determine fair value primarily using future anticipated cash flows that are directly associated with and are expected to arise as a direct result of the use and eventual disposition of the asset, or asset group, discounted using an interest rate commensurate with the risk involved. We have significant long-lived tangible and intangible assets, which are susceptible to valuation adjustments as a result of changes in various factors or conditions. The most significant long-lived tangible and intangible assets, other than goodwill, are property, plant, and equipment, right of use assets, developed technology, customer relationships, patents, trademarks, and trade names. We amortize all finite-lived intangible assets either on a straight-line basis or based upon patterns in which we expect to utilize the economic benefits of such assets. We initially determine the values of intangible assets by a risk-adjusted, discounted cash flow approach. We assess the potential impairment of identifiable intangible assets and fixed assets whenever events or changes in circumstances indicate that the carrying values may not be recoverable and at least annually. Factors we consider important, which could trigger an impairment of such assets, include the following: • significant underperformance relative to historical or projected future operating results; • significant changes in the manner or use of the assets or the strategy for our overall business; • significant negative industry or economic trends; • a significant decline in our stock price for a sustained period; and • a decline in our market capitalization below net book value. Future adverse changes in these or other unforeseeable factors could result in an impairment charge that could materially impact future results of operations and financial position in the reporting period identified. In accordance with ASC 350, Intangibles-Goodwill and Other, we test goodwill for impairment on an annual basis on February 1 and between annual tests if indicators of potential impairment exist. The impairment test compares the fair value of the operating units to their carrying amounts to assess whether impairment is present. We have reviewed the provisions of ASC 350-20, with respect to the criteria necessary to evaluate the number of reporting units that exist. Based on this review, we concluded that we have one operating unit when reviewing ASC 350-20. We review the fair value of our goodwill based on financial performance annually. As of our last valuation date, February 1, 2024, we had $ 19.0 million of goodwill and its fair value significantly exceeded its carrying value, based on EBITDAS, cashflow, and market capitalization. Our assumptions related to the development of fair value could deviate materially from actual results and forecasts used to support asset carrying values may change in the future, which could result in non-cash charges that would adversely affect our financial results of operations. The re-measurement of goodwill is classified as a Level 3 fair value assessment as described in Note 10 - Fair Value Measurement, due to the significance of unobservable inputs developed using company-specific information. |
Income Taxes | Income Taxes – We use the asset and liability approach for financial accounting and reporting income taxes. The provision for income taxes is based upon income reported in the accompanying consolidated financial statements as required by ASC 740, Income Taxes. We determine our deferred tax assets and liabilities based on temporary differences between financial reporting and tax bases in assets and liabilities, which are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. We recognize the effect on deferred taxes of a change in tax rates in the period that includes the enactment date. In assessing the realization of our deferred tax assets, we consider whether it is more likely than not that the deferred tax assets will be realized. The ultimate realization of our deferred tax assets depends upon generating future taxable income during the periods in which our temporary differences become deductible and before our net operating loss carryforwards expire. We evaluate the recoverability of our deferred tax assets by assessing the need for a valuation allowance on a quarterly basis. If we determine that it is more likely than not that our deferred tax assets will not be recovered, we establish a valuation allowance against some or all of our deferred tax assets. Recording or reversing a valuation allowance could have a significant effect on our future results of operations and financial position. |
Warranty | Warranty — We generally provide a limited one-year warranty and a lifetime service policy to the original purchaser of our new firearm products. We will also repair or replace certain products or parts found to be defective under normal use and service with an item of equivalent value, at our option, without charge during the warranty period. We quantify and record an estimate for warranty-related costs based on our actual historical claims experience and current repair costs. We adjust accruals as warranty claims data and historical experience warrant. Should we experience actual claims and repair costs that are higher than the estimated claims and repair costs used to calculate the provision, our operating results for the period or periods in which such returns or additional costs materialize would be adversely impacted. From time to time, we have experienced certain manufacturing and design issues with respect to some of our firearms and have initiated some product recalls and safety alerts. In February 2024, we initiated a safety recall for Response rifles manufactured prior to February 12, 2024 as a result of field reports related to the potential for an out of battery discharge. This safety recall was limited to Response rifles manufactured prior to February 12, 2024 and was conducted to ensure there were no anomalies or conditions that might adversely affect the safety, function, or performance of these rifles. The remaining estimated cost of all recalls, safety alerts, and consumer advisories is $ 38,000 , which is recorded in accrued warranty on our consolidated balance sheet as of April 30, 2024. The remaining balance relates to a general accrual related to standard warranty costs for products shipped in the ordinary course of business. Warranty expense for the fiscal years ended April 30, 2024, 2023, and 2022 amounted to $ 2.6 million, $ 1.5 million, and $ 1.9 million, respectively. The following table sets forth the change in accrued warranties, a portion of which is recorded as a non-current liability, in the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): Balance as of April 30, 2022 $ 4,873 Warranties issued and adjustments to provisions 1,496 Warranty claims ( 2,364 ) Balance as of April 30, 2023 4,005 Warranties issued and adjustments to provisions 2,560 Warranty claims ( 2,681 ) Balance as of April 30, 2024 $ 3,884 |
Sales and Promotional Related Expenses | Sales and Promotional Related Expenses — We present product sales in our consolidated financial statements, net of customer promotional program costs that depend upon the volume of sales. For promotional program costs that do not depend on the volume of sales, we record promotional costs in cost of goods sold. The total of all our promotional programs amounted to $6 .6 million, $ 10.2 million, and $ 6.6 million for the fiscal years ended April 30, 2024, 2023, and 2022, respectively. We have a co-op advertising program at the retail level. We expensed sales and promotional related costs amounting to $ 2.6 million, $ 2.7 million, and $ 4.3 million for fiscal 2024, 2023, and 2022, respectively, as selling and marketing expenses. |
Shipping and Handling | Shipping and Handling — In the accompanying consolidated financial statements, we included amounts billed to customers for shipping and handling in net sales. Inbound freight charges and internal transfer costs are included in cost of goods sold; however, costs incurred to distribute products to customers is included in selling, marketing, and distribution expenses. |
Insurance Reserves | Insurance Reserves — In January 2020, we formed a wholly owned captive insurance company, which provides product liability insurance to us and our subsidiaries. We are self-insured through retentions or deductibles for the majority of our workers’ compensation, automobile, general liability, product liability, and group health insurance programs. Self-insurance amounts vary up to $ 10.0 million per occurrence; however, we believe the likelihood of reaching the maximum per occurrence limit is remote. We record our liability for estimated premiums and incurred losses in the accompanying consolidated financial statements on an undiscounted basis. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards — There are no new accounting pronouncements that are expected to have a significant impact on our consolidated financial statements. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Accounting Policies [Abstract] | |
Summary of Estimated Useful Lives | A summary of the estimated useful lives is as follows: Description Useful Life Building and improvements 10 to 40 years Software and hardware 2 to 7 years Machinery and equipment 2 to 10 years |
Reconciliation of Net Income/(Loss) Amounts and Weighted Average Number of Common and Common Equivalent Shares Used to Determine Basic and Diluted (Loss)/Earnings per Common Share | The following table provides a reconciliation of the net income amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings per common share (in thousands, except per share data): For the Year Ended April 30, 2024 2023 2022 Net income $ 39,609 $ 36,876 $ 194,494 Weighted average shares outstanding — Basic 45,813 45,844 47,227 Effect of dilutive stock awards 436 326 501 Weighted average shares outstanding — Diluted 46,248 46,170 47,728 Earnings per share — Basic $ 0.86 $ 0.80 $ 4.12 Earnings per share — Diluted $ 0.86 $ 0.80 $ 4.08 |
Change in Accrued Warranties Recorded as Non-Current Liability | The following table sets forth the change in accrued warranties, a portion of which is recorded as a non-current liability, in the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): Balance as of April 30, 2022 $ 4,873 Warranties issued and adjustments to provisions 1,496 Warranty claims ( 2,364 ) Balance as of April 30, 2023 4,005 Warranties issued and adjustments to provisions 2,560 Warranty claims ( 2,681 ) Balance as of April 30, 2024 $ 3,884 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Leases [Abstract] | |
Schedule of Assets and Liabilities Related to Operating and Financing Leases | The amounts of assets and liabilities related to our operating and financing leases as of April 30, 2024 were as follows (in thousands): Balance Sheet Caption April 30, 2024 April 30, 2023 Operating Leases Right-of-use assets $ 6,761 $ 5,994 Accumulated amortization ( 5,411 ) ( 4,153 ) Right-of-use assets, net Other assets $ 1,350 $ 1,841 Current liabilities Accrued expenses and deferred revenue $ 947 $ 1,274 Non-current liabilities Other non-current liabilities 574 801 Total operating lease liabilities $ 1,521 $ 2,075 Finance Leases Right-of-use assets $ 41,631 $ 41,631 Accumulated depreciation ( 11,713 ) ( 9,448 ) Right-of-use assets, net Property, plant, and equipment, net $ 29,918 $ 32,183 Current liabilities Accrued expenses and deferred revenue $ 1,564 $ 1,434 Non-current liabilities Finance lease payable, net of current portion 35,404 36,961 Total finance lease liabilities $ 36,968 $ 38,395 |
Summary of Future Expected Undiscounted Cash Flows | The following table represents future expected undiscounted cashflows, based on the Assignment and Assumption Agreement with AOUT, to be received on an annual basis for the next five years and thereafter, as of April 30, 2024 (in thousands): Fiscal Amount 2025 $ 3,180 2026 3,235 2027 3,292 2028 3,350 2029 3,408 Thereafter 35,498 Total future receipts 51,963 Less amounts representing interest ( 15,607 ) Present value of receipts $ 36,356 |
Summary of Future Lease Payments for Operating and Finance Leases | Future lease payments for all our operating and finance leases for succeeding fiscal years is as follows (in thousands): Operating Financing Total 2025 $ 1,033 $ 3,378 $ 4,411 2026 301 3,433 3,734 2027 272 3,498 3,770 2028 125 3,416 3,541 2029 — 3,408 3,408 Thereafter — 35,498 35,498 Total future lease payments 1,731 52,631 54,362 Less amounts representing interest ( 210 ) ( 15,663 ) ( 15,873 ) Present value of lease payments 1,521 36,968 38,489 Less current maturities of lease liabilities ( 947 ) ( 1,564 ) ( 2,511 ) Long-term maturities of lease liabilities $ 574 $ 35,404 $ 35,978 |
Net Sales (Tables)
Net Sales (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Disclosure Net Sales [Abstract] | |
Breakdown of Net Sales | The following table sets forth the breakdown of net sales for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Years Ended April 30, 2024 2023 2022 Handguns $ 381,898 $ 360,668 $ 624,219 Long Guns 116,491 74,230 189,467 Other Products & Services 37,444 44,344 50,440 Total Net Sales $ 535,833 $ 479,242 $ 864,126 |
Breakdown of Export Net Sales | The following table sets forth the breakdown of export net sales included in the above table. Our export net sales shown below accounted for approximately 5 %, 4 %, and 3 % of total net sales for the fiscal years ended April 30, 2024, 2023, and 2022, respectively (in thousands): For the Years Ended April 30, Region 2024 2023 2022 Asia $ 9,346 $ 5,411 $ 3,899 Latin America 5,314 4,052 5,272 Europe 4,786 6,569 8,342 All others international 5,143 3,736 8,014 Total international net sales $ 24,589 $ 19,768 $ 25,527 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property, Plant, and Equipment | The following table summarizes property, plant, and equipment as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Machinery and equipment $ 337,772 $ 308,852 Building and improvements 154,507 40,131 Software and hardware 52,750 49,569 Land and improvements 3,109 2,945 Right of use assets 41,631 41,631 589,769 443,128 Less: Accumulated depreciation and amortization ( 352,615 ) ( 334,383 ) 237,154 108,745 Construction in progress 15,479 101,585 Total property, plant, and equipment, net $ 252,633 $ 210,330 |
Summary of Depreciation and Amortization Expense | The following table summarizes depreciation and amortization expense, which includes amortization of intangibles and debt financing costs, by line item for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Years Ended April 30, 2024 2023 2022 Cost of sales $ 20,607 $ 22,205 $ 21,879 Research and development 533 529 484 Selling, marketing, and distribution 3,635 1,524 509 General and administrative 7,693 7,088 7,111 Interest expense 90 90 90 Total depreciation and amortization $ 32,558 $ 31,436 $ 30,073 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | The following table sets forth a summary of inventories, net of reserves, stated at lower of cost or net realizable value, as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Finished goods $ 83,337 $ 93,705 Finished parts 56,282 65,460 Work in process 8,033 6,821 Raw material 12,848 11,132 Total inventories $ 160,500 $ 177,118 |
Accrued Expenses and Deferred_2
Accrued Expenses and Deferred Revenue (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses | The following table sets forth other accrued expenses as of April 30, 2024 and 2023 (in thousands): April 30, 2024 April 30, 2023 Accrued taxes other than income $ 5,838 $ 3,703 Accrued professional fees 4,925 2,596 Accrued other 4,423 4,597 Accrued settlement 3,200 — Accrued employee benefits 2,742 3,256 Accrued distributor incentives 1,687 1,640 Current portion of finance lease obligation 1,564 1,434 Accrued rebates and promotions 1,485 1,649 Current portion of operating lease obligation 947 1,274 Total accrued expenses and deferred revenue $ 26,811 $ 20,149 |
Self-Insurance Reserves (Tables
Self-Insurance Reserves (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Other Liabilities | The following table summarizes the activity in the workers’ compensation, product liability, municipal liability, and medical/dental reserves in the fiscal years ended April 30, 2024 and 2023 (in thousands): For the Year Ended April 30, 2024 2023 Beginning balance $ 9,239 $ 8,676 Additional provision charged to expense 2,921 3,589 Payments ( 3,461 ) ( 3,026 ) Ending balance $ 8,699 $ 9,239 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Equity [Abstract] | |
Summary of Stock Compensation Expense | The following table summarizes stock compensation expense by line item for the fiscal years ended April 30, 2024, 2023, and 2022 (in thousands): For the Year Ended April 30, 2024 2023 2022 Cost of sales $ 648 $ 667 $ 809 Research and development 77 80 61 Selling, marketing, and distribution 930 814 844 General and administrative 4,028 3,541 2,822 Total stock-based compensation $ 5,683 $ 5,102 $ 4,536 |
Share Based Payment Award Performance Shares Valuation Assumptions | We grant PSUs to our executive officers. At the time of grant, we calculate the fair value of our PSUs using the Monte-Carlo simulation. We incorporate the following variables into the valuation model: For the Year Ended April 30, 2024 2023 2022 Grant date fair market value Smith & Wesson Brands, Inc $ 12.08 $ 14.19 $ 18.67 Russell 2000 Index $ 1,769.21 $ 2,015.04 $ 2,277.45 Volatility (a) Smith & Wesson Brands, Inc 58.46 % 64.77 % 62.33 % Russell 2000 Index 27.08 % 31.75 % 30.69 % Correlation coefficient (b) 0.3528 0.2094 0.1540 Risk-free interest rate (c) 3.81 % 2.91 % 0.33 % Dividend yield 3.31 % 2.26 % 1.07 % (a) Expected volatility is calculated over the most recent period that represents the remaining term of the performance period as of the valuation date, or three years . (b) The correlation coefficient utilizes the same historical price data used to develop the volatility assumptions. (c) The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bill, commensurate with the three-year performance period. |
Summary of Activity for Unvested RSUs and PSUs | A summary of activity for unvested RSUs and PSUs for fiscal years 2024, 2023, and 2022 is as follows: For the Year Ended April 30, 2024 2023 2022 Weighted Weighted Weighted Total # of Average Total # of Average Total # of Average Restricted Grant Date Restricted Grant Date Restricted Grant Date Stock Units Fair Value Stock Units Fair Value Stock Units Fair Value RSUs and PSUs outstanding, beginning of period 932,705 $ 13.14 830,813 $ 13.30 995,879 $ 11.14 Awarded 533,940 12.07 425,390 (a) 13.52 301,880 18.95 Released ( 283,813 ) (b) 11.54 ( 288,319 ) 13.92 ( 368,550 ) 11.99 Forfeited ( 182,485 ) 10.83 ( 35,179 ) 15.17 ( 98,396 ) 12.29 RSUs and PSUs outstanding, end of period 1,000,347 $ 13.45 932,705 $ 13.14 830,813 $ 13.30 _____________________ (a) Includes 28,800 PSUs that vested during the fiscal year in connection with achieving maximum performance targets for the 2019 grants. (b) Includes 55,726 PSUs that vested during fiscal 2023. |
Schedule of Assumptions used in Valuing ESPP Purchases | The following assumptions were used in valuing our ESPP purchases during the years ended April 30, 2024, 2023, and 2022: For the Year Ended April 30, 2024 2023 2022 Risk-free interest rate 5.225 % 4.301 % 0.682 % Expected term 6 months 6 months 6 months Expected volatility 45.69 % 49.18 % 60.62 % Dividend yield 3.27 % 3.59 % 1.85 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Tax Expense/(Benefit) from Continuing Operations | Income tax expense/(benefit) from continuing operations consisted of the following (in thousands): For the Year Ended April 30, 2024 2023 2022 Current: Federal $ 6,315 $ 16,259 $ 52,843 State 2,637 1,955 7,174 Total current 8,952 18,214 60,017 Deferred: Federal 2,558 ( 6,217 ) ( 1,889 ) State ( 1,723 ) ( 647 ) ( 236 ) Total deferred 835 ( 6,864 ) ( 2,125 ) Total income tax expense $ 9,787 $ 11,350 $ 57,892 |
Reconciliation of Provision for Income Taxes from Continuing Operations | The following table presents a reconciliation of income tax expense from continuing operations at the statutory rate of 21 % to the expense/(benefit) in the consolidated financial statements (in thousands): For the Year Ended April 30, 2024 2023 2022 Federal income taxes expected at the statutory rate $ 10,373 $ 10,127 $ 53,001 State income taxes, net of federal tax effects ( 225 ) 1,023 5,503 Stock compensation 467 136 ( 749 ) Business meals and entertainment 100 89 118 Research and development tax credit ( 281 ) ( 265 ) ( 300 ) Amendments to prior year returns ( 1,176 ) — — Other 529 240 319 Total income tax expense $ 9,787 $ 11,350 $ 57,892 |
Deferred Tax Assets (Liabilities) Related to Temporary Differences | Deferred tax assets and liabilities related to temporary differences consisted of the following (in thousands): For the Years Ended April 30, 2024 2023 Deferred Tax Assets Inventory reserves $ 8,489 $ 7,495 Accrued expenses, including compensation 4,678 4,764 Net operating loss carryforwards and tax credits 3,988 3,156 Operating lease liability 240 473 Product liability 191 596 Workers' compensation 704 477 State bonus depreciation 1,812 755 Warranty reserve 1,017 913 Stock-based compensation 1,319 1,551 Section 174 capitalized R&D expense 2,502 1,549 Other 820 622 Total deferred tax assets before valuation allowance 25,760 22,351 Valuation allowance ( 3,350 ) ( 3,031 ) Net deferred tax assets 22,410 19,320 Deferred Tax Liabilities Operating lease right-of-use assets ( 197 ) ( 420 ) Property, plant & equipment ( 12,426 ) ( 8,847 ) Intangible assets ( 2,270 ) ( 1,581 ) Other ( 268 ) ( 387 ) Total deferred tax liabilities ( 15,161 ) ( 11,235 ) Net Deferred Tax Asset/(Liability) $ 7,249 $ 8,085 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Apr. 30, 2024 | |
Restructuring Costs [Abstract] | |
Schedule of Components of Restructuring Charges | The following table summarizes restructuring charges by line item for fiscal 2024 and fiscal 2023 (in thousands): For the Year Ended April 30, 2024 2023 Cost of sales $ 2,116 $ 3,923 Research and development — 3 Selling, marketing, and distribution 2,974 1,055 General and administrative 1,963 3,280 Total restructuring charges $ 7,053 $ 8,261 The components of the restructuring charges recorded in our consolidated statements of income are as follows (in thousands): For the Year Ended April 30, 2024 2023 Office rent and equipment $ 2,298 $ 229 Employee relations 2,011 349 Consulting services 992 473 Public relations 904 — Relocation (a) 887 2,856 Freight 199 — Severance and employee-related benefits (a) ( 238 ) 4,354 Total restructuring charges $ 7,053 $ 8,261 ____________________________________ (a) Recorded in accrued payroll and incentives |
Schedule of Severance and employee related benefits and Relocation accruals | The following table summarizes the activity in the severance and employee-related benefits and relocation accruals for fiscal 2024 and fiscal 2023 (in thousands): Severance and employee-related benefits Relocation Total Accrual at April 30, 2023 $ 10,054 $ 1,746 $ 11,800 Charges ( 238 ) 887 649 Cash payments and settlements ( 4,289 ) ( 1,805 ) ( 6,094 ) Accrual at April 30, 2024 (a) $ 5,527 $ 828 $ 6,355 ___________________________________ (a) Recorded in accrued payroll and incentives |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | ||||
Apr. 30, 2024 USD ($) Customer shares | Apr. 30, 2023 USD ($) Customer shares | Apr. 30, 2022 USD ($) shares | Feb. 01, 2024 USD ($) | Apr. 30, 2020 USD ($) | |
Product Information [Line Items] | |||||
Maximum maturity period of all highly liquid investments to be considered cash equivalents | 3 months | ||||
Goodwill | $ 19,024,000 | $ 19,024,000 | $ 19,000,000 | ||
Remaining estimated cost related to recalls, safety alerts, and consumer advisories | 38,000 | ||||
Warranty expense | 2,600,000 | 1,500,000 | $ 1,900,000 | ||
Promotional programs amount | 600,000 | 10,200,000 | 6,600,000 | ||
Selling and marketing expenses | $ 2,600,000 | $ 2,700,000 | $ 4,300,000 | ||
Shares excluded from the computation of diluted earnings per share | shares | 18,009 | 30,307 | 43,530 | ||
Self Insurance | |||||
Product Information [Line Items] | |||||
Maximum amount of self-insurance per occurrence | $ 10,000,000 | ||||
ASU 2014-09 | |||||
Product Information [Line Items] | |||||
Description of payment terms | We generally sell our products free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 60 days of product shipment with a discount available to some customers for early payment. Generally, framework contracts define the general terms of sales, including payment terms, freight terms, insurance requirements, and cancelation provisions. Purchase orders define the terms for specific sales, including description, quantity, and price of each product purchased. We estimate variable consideration relative to the amount of cash discounts to which customers are likely to be entitled. As a result of utilizing practical expedients upon the adoption of ASC 606, we do not consider these extended terms to be a significant financing component of the contract because the payment terms are less than one year. | ||||
Other Capitalized Property Plant and Equipment | Maximum | |||||
Product Information [Line Items] | |||||
Estimated useful life | 10 years | ||||
Sales, net | Customer Concentration Risk | |||||
Product Information [Line Items] | |||||
Number of Customers Accounted for Net Sales. | Customer | 3 | 2 | |||
Sales, net | Customer Concentration Risk | Customer Two | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 22.80% | ||||
Sales, net | Customer Concentration Risk | Customer Two | Minimum | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 10% | ||||
Sales, net | Customer Concentration Risk | Customer Three | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 34.80% | ||||
Sales, net | Customer Concentration Risk | Customer Three | Minimum | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 10% | ||||
Accounts Receivable | Customer Concentration Risk | |||||
Product Information [Line Items] | |||||
Number of Customers Accounted for Accounts Receivable | Customer | 2 | 3 | |||
Accounts Receivable | Customer Concentration Risk | Customer Two | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 47.90% | ||||
Accounts Receivable | Customer Concentration Risk | Customer Two | Minimum | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 10% | ||||
Accounts Receivable | Customer Concentration Risk | Customer Three | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 39.40% | ||||
Accounts Receivable | Customer Concentration Risk | Customer Three | Minimum | |||||
Product Information [Line Items] | |||||
Concentration of risk, percentage | 10% | ||||
Level 2 | |||||
Product Information [Line Items] | |||||
Fair value of financial instrument | $ 0 | $ 0 |
Significant Accounting Polici_5
Significant Accounting Policies - Summary of Estimated Useful Lives (Detail) | Apr. 30, 2024 |
Building and improvements | Minimum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 10 years |
Building and improvements | Maximum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 40 years |
Software and hardware | Minimum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 2 years |
Software and hardware | Maximum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 7 years |
Machinery and equipment | Minimum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 2 years |
Machinery and equipment | Maximum | |
Property Plant And Equipment [Line Items] | |
Estimated useful life | 10 years |
Significant Accounting Polici_6
Significant Accounting Policies - Reconciliation of Net Income/(Loss) Amounts and Weighted Average Number of Common and Common Equivalent Shares Used to Determine Basic and Diluted (Loss)/Earnings per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Net income/(loss) | |||
Net income | $ 39,609 | $ 36,876 | $ 194,494 |
Weighted average shares outstanding — Basic | 45,813 | 45,844 | 47,227 |
Effect of dilutive stock awards | 436 | 326 | 501 |
Weighted average shares outstanding — Diluted | 46,248 | 46,170 | 47,728 |
Earnings per share - Basic | $ 0.86 | $ 0.8 | $ 4.12 |
Earnings per share - Diluted | $ 0.86 | $ 0.8 | $ 4.08 |
Significant Accounting Polici_7
Significant Accounting Policies - Change in Accrued Warranties Recorded as Non-Current Liability (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Accounting Policies [Abstract] | ||
Beginning Balance | $ 4,005 | $ 4,873 |
Warranties issued and adjustments to provisions | 2,560 | 1,496 |
Warranty claims | (2,681) | (2,364) |
Ending Balance | $ 3,884 | $ 4,005 |
Leases - Schedule of Assets and
Leases - Schedule of Assets and Liabilities Related to Operating and Financing Leases (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Operating Leases | ||
Right-of-use assets | $ 6,761 | $ 5,994 |
Accumulated amortization | (5,411) | (4,153) |
Right-of-use assets, net | $ 1,350 | $ 1,841 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other assets | Other assets |
Current liabilities | $ 947 | $ 1,274 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses and deferred revenue | Accrued expenses and deferred revenue |
Non-current liabilities | $ 574 | $ 801 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other non-current liabilities | Other non-current liabilities |
Total operating lease liabilities | $ 1,521 | $ 2,075 |
Finance Leases | ||
Right-of-use assets | 41,631 | 41,631 |
Accumulated depreciation | (11,713) | (9,448) |
Right-of-use assets, net | $ 29,918 | $ 32,183 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, plant, and equipment, net | Property, plant, and equipment, net |
Current liabilities | $ 1,564 | $ 1,434 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses and deferred revenue | Accrued expenses and deferred revenue |
Non-current liabilities | $ 35,404 | $ 36,961 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Non-current liabilities | Non-current liabilities |
Total finance lease liabilities | $ 36,968 | $ 38,395 |
Leases - Additional Information
Leases - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Jul. 16, 2022 | Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Lessee Lease Description [Line Items] | ||||
Operating lease cost | $ 1,500,000 | |||
Short-term operating lease costs | 98,000 | |||
Finance lease amortization | 2,300,000 | |||
Financing lease interest expense | $ 1,900,000 | |||
Operating leases, weighted average lease term | 2 years 2 months 12 days | |||
Operating leases, weighted average discount rate | 3.20% | |||
Financing leases, weighted average lease term | 14 years 4 months 24 days | |||
Financing leases, weighted average discount rate | 5% | |||
Percentage of sublease | 64.70% | |||
Income related to sublease agreement | $ 2,700,000 | |||
Cash paid for amounts included in measurement of liabilities and operating cash flows | 4,600,000 | |||
General And Administrative | $ 65,484,000 | $ 61,604,000 | $ 72,493,000 | |
National Logistics Facility [Member] | ||||
Lessee Lease Description [Line Items] | ||||
Percentage of sublease | 59% | |||
General and Administrative Expense | ||||
Lessee Lease Description [Line Items] | ||||
Income related to sublease agreement | $ 1,300,000 | |||
Interest Expense, Net | ||||
Lessee Lease Description [Line Items] | ||||
Income related to sublease agreement | $ 1,400,000 |
Leases - Summary of Future Expe
Leases - Summary of Future Expected Undiscounted Cash Flows (Details) $ in Thousands | Apr. 30, 2024 USD ($) |
Leases [Abstract] | |
2025 | $ 3,180 |
2026 | 3,235 |
2027 | 3,292 |
2028 | 3,350 |
2029 | 3,408 |
Thereafter | 35,498 |
Total future sublease receipts | 51,963 |
Less amounts representing interest | (15,607) |
Present value of sublease receipts | $ 36,356 |
Leases - Summary of Future Leas
Leases - Summary of Future Lease Payments for Operating and Finance Leases (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Operating and Finance Lease liabilities payments | ||
2025 | $ 4,411 | |
2026 | 3,734 | |
2027 | 3,770 | |
2028 | 3,541 | |
2029 | 3,408 | |
Thereafter | 35,498 | |
Total future lease payments | 54,362 | |
Less amounts representing interest | (15,873) | |
Present value of lease payments | 38,489 | |
Less current maturities of lease liabilities | (2,511) | |
Long-term maturities of lease liabilities | 35,978 | |
Operating Leases | ||
2025 | 1,033 | |
2026 | 301 | |
2027 | 272 | |
2028 | 125 | |
2029 | 0 | |
Thereafter | 0 | |
Total future lease payments | 1,731 | |
Less amounts representing interest | (210) | |
Total operating lease liabilities | 1,521 | $ 2,075 |
Less current maturities of lease liabilities | (947) | (1,274) |
Long-term maturities of lease liabilities | 574 | 801 |
Financing Leases | ||
2025 | 3,378 | |
2026 | 3,433 | |
2027 | 3,498 | |
2028 | 3,416 | |
2029 | 3,408 | |
Thereafter | 35,498 | |
Total future lease payments | 52,631 | |
Less amounts representing interest | (15,663) | |
Total finance lease liabilities | 36,968 | 38,395 |
Less current maturities of lease liabilities | (1,564) | (1,434) |
Non-current liabilities | $ 35,404 | $ 36,961 |
Notes, Loans Payable, and Fin_2
Notes, Loans Payable, and Financing Arrangements - Additional Information (Detail) - USD ($) | 12 Months Ended | ||||
Aug. 24, 2020 | Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | Apr. 30, 2021 | |
Debt Instrument [Line Items] | |||||
Amortization to interest expense for all debt issuance costs | $ 89,805 | $ 89,560 | $ 89,560 | ||
Notes Payable | |||||
Debt Instrument [Line Items] | |||||
Debt issuance cost | $ 450,000 | ||||
Maximum | |||||
Debt Instrument [Line Items] | |||||
Swingline Loan | $ 5,000,000 | ||||
Swingline Loan | |||||
Debt Instrument [Line Items] | |||||
Interest description of revolving line of credit | Each Swingline Loan (as defined in the Amended and Restated Credit Agreement) bears interest at the Base Rate, plus an applicable margin based on our Adjusted Consolidated Leverage Ratio (as defined in the Amended and Restated Credit Agreement) | ||||
Credit facility additional borrowing capacity option to increase maximum borrowing capacity | 50,000,000 | ||||
Unsecured Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, borrowing capacity | $ 100,000,000 | ||||
Interest description of revolving line of credit | The Revolving Line bears interest at either the Base Rate (as defined in the Amended and Restated Credit Agreement) or the SOFR rate, plus an applicable margin based on our consolidated leverage ratio. | ||||
Credit facility, maturity | Aug. 24, 2025 | ||||
Credit Facilities | |||||
Debt Instrument [Line Items] | |||||
Borrowings outstanding | $ 40,000,000 | ||||
Outstanding letters of credit | 2,700,000 | ||||
Line Of Credit Facility Interest Capitalised | 759,000 | ||||
Credit Facilities | Self Insurance | |||||
Debt Instrument [Line Items] | |||||
Outstanding letters of credit | $ 1,500,000 | ||||
Credit Facilities | London Interbank Offered Rate [Member] | |||||
Debt Instrument [Line Items] | |||||
Interest rate on borrowings | 7.18% |
Net Sales - Breakdown of Net sa
Net Sales - Breakdown of Net sale (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Segment Reporting Revenue Reconciling Item [Line Items] | |||
Total Net Sales | $ 535,833 | $ 479,242 | $ 864,126 |
Handguns | |||
Segment Reporting Revenue Reconciling Item [Line Items] | |||
Total Net Sales | 381,898 | 360,668 | 624,219 |
Long Guns | |||
Segment Reporting Revenue Reconciling Item [Line Items] | |||
Total Net Sales | 116,491 | 74,230 | 189,467 |
Other products and services | |||
Segment Reporting Revenue Reconciling Item [Line Items] | |||
Total Net Sales | $ 37,444 | $ 44,344 | $ 50,440 |
Net Sales - Additional Informat
Net Sales - Additional Information (Detail) | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Disclosure Net Sales [Abstract] | |||
Export sales as percentage of revenue | 5% | 4% | 3% |
Net Sales - Breakdown of Export
Net Sales - Breakdown of Export Net Sales (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Concentration Risk [Line Items] | |||
Net sales | $ 535,833 | $ 479,242 | $ 864,126 |
Europe | |||
Concentration Risk [Line Items] | |||
Net sales | 4,786 | 6,569 | 8,342 |
Asia | |||
Concentration Risk [Line Items] | |||
Net sales | 9,346 | 5,411 | 3,899 |
Latin America | |||
Concentration Risk [Line Items] | |||
Net sales | 5,314 | 4,052 | 5,272 |
All others international | |||
Concentration Risk [Line Items] | |||
Net sales | 5,143 | 3,736 | 8,014 |
Total International | |||
Concentration Risk [Line Items] | |||
Net sales | $ 24,589 | $ 19,768 | $ 25,527 |
Advertising Costs - Additional
Advertising Costs - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Selling, marketing, and distribution | |||
Advertising Costs [Line Items] | |||
Advertising expense for continuing operations | $ 14.7 | $ 14.7 | $ 17.5 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment - Summary of Property, Plant, and Equipment (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Property, Plant and Equipment [Abstract] | ||
Machinery and equipment | $ 337,772 | $ 308,852 |
Building and improvements | 154,507 | 40,131 |
Software and hardware | 52,750 | 49,569 |
Land and improvements | 3,109 | 2,945 |
Right-of-use assets | 41,631 | 41,631 |
Property plant and equipment gross | 589,769 | 443,128 |
Less: Accumulated depreciation and amortization | (352,615) | (334,383) |
Property plant and equipment before construction in progress | 237,154 | 108,745 |
Construction in progress | 15,479 | 101,585 |
Total property, plant, and equipment, net | $ 252,633 | $ 210,330 |
Property, Plant, and Equipmen_3
Property, Plant, and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Property Plant And Equipment [Line Items] | |||
Depreciation and amortization expense | $ 32,558 | $ 31,436 | $ 30,073 |
Software | |||
Property Plant And Equipment [Line Items] | |||
Depreciation and amortization expense | $ 32,000 | $ 31,000 | $ 29,500 |
Property, Plant, and Equipmen_4
Property, Plant, and Equipment - Summary of Depreciation and Amortization Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | $ 32,558 | $ 31,436 | $ 30,073 |
Cost of sales | |||
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | 20,607 | 22,205 | 21,879 |
Research and development | |||
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | 533 | 529 | 484 |
Selling, marketing, and distribution | |||
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | 3,635 | 1,524 | 509 |
General and administrative | |||
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | 7,693 | 7,088 | 7,111 |
Interest expense | |||
Depreciation and Other Amortization Expenses [Line Items] | |||
Depreciation and amortization | $ 90 | $ 90 | $ 90 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 83,337 | $ 93,705 |
Finished parts | 56,282 | 65,460 |
Work in process | 8,033 | 6,821 |
Raw material | 12,848 | 11,132 |
Total inventories | $ 160,500 | $ 177,118 |
Accrued Expenses and Deferred_3
Accrued Expenses and Deferred Revenue - Summary of Accrued Expenses (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Accrued taxes other than income | $ 5,838 | $ 3,703 |
Accrued professional fees | 4,925 | 2,596 |
Accrued other | 4,423 | 4,597 |
Accrued settlement | 3,200 | 0 |
Accrued employee benefits | 2,742 | 3,256 |
Accrued distributor incentives | 1,687 | 1,640 |
Current portion of finance lease obligation | $ 1,564 | $ 1,434 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | Total accrued expenses and deferred revenue | Total accrued expenses and deferred revenue |
Accrued rebates and promotions | $ 1,485 | $ 1,649 |
Current portion of operating lease obligation | $ 947 | $ 1,274 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Total accrued expenses and deferred revenue | Total accrued expenses and deferred revenue |
Total accrued expenses and deferred revenue | $ 26,811 | $ 20,149 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
(Level 1) | Fair Value on Recurring Basis | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 60,800 | $ 53,600 |
(Level 2) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Financial assets | 0 | |
Financial liabilities | 0 | |
(Level 3) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Financial assets | 0 | |
Financial liabilities | $ 0 |
Self-Insurance Reserves - Addit
Self-Insurance Reserves - Additional Information (Detail) - USD ($) | Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 |
Commitments and Contingencies Disclosure [Abstract] | |||
Reserves for workers' compensation, product liability, municipal liability, and medical/dental costs | $ 8,699,000 | $ 9,239,000 | $ 8,676,000 |
Reserves for workers' compensation, product liability, municipal liability, and medical/dental costs, Non-current portion | 3,300,000 | 2,600,000 | |
Reserves for workers' compensation, product liability, municipal liability, and medical/dental costs, included in accrued expenses | 5,400,000 | 6,600,000 | |
Workers' compensation receivable classified as an other assets | 984,000 | 663,000 | |
Accrued reserves for product and municipal litigation liabilities | 3,100,000 | 4,300,000 | |
Accrued reserves for product and municipal litigation liabilities, Non-current portion | 497,000 | $ 568,000 | |
Receivables from insurance carriers, included in other assets | $ 1,900,000 |
Self-Insurance Reserves - Summa
Self-Insurance Reserves - Summary of Other Liabilities (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Beginning balance | $ 9,239 | $ 8,676 |
Additional provision charged to expense | 2,921 | 3,589 |
Payments | (3,461) | (3,026) |
Ending balance | $ 8,699 | $ 9,239 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) | 12 Months Ended | ||||||||
Mar. 31, 2022 | Apr. 30, 2024 USD ($) Segment shares | Apr. 30, 2023 USD ($) shares | Apr. 30, 2022 USD ($) shares | Apr. 30, 2020 shares | Sep. 19, 2023 USD ($) | Sep. 12, 2022 shares | Sep. 27, 2021 shares | Sep. 26, 2011 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Number of stock incentive plans | Segment | 2 | ||||||||
Vesting, percentage | 0.083% | ||||||||
Performance period | 3 years | ||||||||
Percentage of maximum aggregate award granted | 200% | ||||||||
Percentage of stock outperform in order for target award to vest | 5% | ||||||||
Stock-based compensation expense | $ | $ 5,683,000 | $ 5,102,000 | $ 4,536,000 | ||||||
Grant date fair value of vested RSUs and PSUs | $ | $ 3,300,000 | $ 4,000,000 | $ 4,400,000 | ||||||
Shares issued under employee stock purchase plan | 151,225 | 175,047 | |||||||
2011 Employee Stock Purchase Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Weighted average remaining contractual term | 10 years | ||||||||
Option exercise price per share as a percentage of fair market value | 85% | ||||||||
Number of shares an employee may purchase under the stock purchase plan | 12,500 | ||||||||
Fair market value of shares an employee may purchase under the stock purchase plan | $ | $ 25,000 | ||||||||
Shares issued under employee stock purchase plan | 128,422 | ||||||||
RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, awarded | 357,357 | 287,854 | 184,767 | ||||||
Stock units, forfeited | 24,385 | 35,179 | 45,249 | ||||||
Stock units, Released | 228,087 | 202,859,000 | |||||||
Grant date fair value of vested RSUs and PSUs | $ | $ 2,700,000 | $ 2,700,000 | |||||||
PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Performance period | 3 years | ||||||||
Percentage of maximum aggregate award granted | 200% | 200% | |||||||
Stock units, awarded | 28,800 | 43,200 | |||||||
Stock units, forfeited | 158,100 | 40,869 | |||||||
Stock units, Released | 55,726 | 28,800 | |||||||
Stock units released to cover tax obligations | 1,874 | 2,814 | |||||||
RSUs and PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Unrecognized compensation expense | $ | $ 3,800,000 | ||||||||
Stock units, awarded | 533,940 | 425,390 | 301,880 | ||||||
Stock units, forfeited | 182,485 | 35,179 | 98,396 | ||||||
Stock units, Released | 283,813 | 288,319 | 368,550 | ||||||
Weighted average remaining contractual term | 1 year 3 months 18 days | ||||||||
Employees | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Grant date fair value of vested RSUs and PSUs | $ | $ 7,500,000 | ||||||||
Employees | PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, Released | 365,736 | ||||||||
Directors | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 1 year | ||||||||
Stock units, awarded | 58,819 | 56,497 | 42,702 | ||||||
Executive Officer | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, awarded | 117,724 | 72,494 | 65,518 | ||||||
Executive Officer | PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, awarded | 176,583 | 108,736 | 73,913 | ||||||
Stock units, Released | 55,726 | 83,586 | |||||||
Grant date fair value of vested RSUs and PSUs | $ | $ 664,000 | $ 1,200,000 | |||||||
Excecutive and former executive officer | PSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, awarded | 57,600 | ||||||||
Stock units, Released | 86,400,000 | ||||||||
Non-Executive Officer Employees | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock units, awarded | 180,814 | 158,863 | 76,547 | ||||||
2013 Incentive Stock Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Authorized of common stock | 1,000,000 | ||||||||
Vesting period | 4 years | ||||||||
Stock option, exercisable period | 10 years | ||||||||
Shares available for grant under incentive stock option | 4,312,247 | ||||||||
2022 Incentive Stock Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Shares available for grant under incentive stock option | 5,420,444 | ||||||||
Maximum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Payroll deduction of participant's compensation | 20% | ||||||||
Maximum | 2011 Employee Stock Purchase Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Common stock reserved under employee stock purchase plan | 3,000,000 | 6,000,000 | |||||||
Maximum | Employees | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 4 years | ||||||||
Vesting, percentage | 0.25% | ||||||||
Minimum | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Payroll deduction of participant's compensation | 1% | ||||||||
Minimum | Employees | RSUs | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Vesting period | 3 years | ||||||||
Vesting, percentage | 0.33% | ||||||||
Common Stock | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Shares issued under employee stock purchase plan | 151,000 | 175,000 | 129,000 | ||||||
Common Stock | 2011 Employee Stock Purchase Plan | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Shares issued under employee stock purchase plan | 1,948,334 | ||||||||
Common Stock | Transaction Until September 19, 2024 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Stock repurchase authorization | $ | $ 50,000,000 | ||||||||
Repurchase of common stock | 793,551 | ||||||||
Treasury Stock, Value, Acquired, Cost Method | $ | $ 10,200,000 | ||||||||
Common Stock | Share Repurchase Transactions | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Repurchase of common stock | 2,788,152 | ||||||||
Treasury Stock, Value, Acquired, Cost Method | $ | $ 50,000,000 | ||||||||
Common Stock | Transaction Until 2022 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Repurchase of common stock | 1,967,420 | ||||||||
Treasury Stock, Value, Acquired, Cost Method | $ | $ 40,000,000 | ||||||||
Common Stock | Transaction Until June 15, 2021 | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||
Treasury Stock, Value, Acquired, Cost Method | $ | $ 50,000,000 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Stock Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 5,683 | $ 5,102 | $ 4,536 |
Cost of sales | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 648 | 667 | 809 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 77 | 80 | 61 |
Selling, marketing, and distribution | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | 930 | 814 | 844 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 4,028 | $ 3,541 | $ 2,822 |
Stockholders' Equity - Share Ba
Stockholders' Equity - Share Based Payment Award Performance Shares Valuation Assumptions (Detail) - PSUs | 12 Months Ended | |||
Apr. 30, 2024 CorrelationCoefficient $ / shares | Apr. 30, 2023 CorrelationCoefficient $ / shares | Apr. 30, 2022 CorrelationCoefficient $ / shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Correlation coefficient | CorrelationCoefficient | [1] | 0.3528 | 0.2094 | 0.154 |
Risk-free interest rate | [2] | 3.81% | 2.91% | 0.33% |
Dividend yield | 3.31% | 2.26% | 1.07% | |
Smith & Wesson Brands, Inc. | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grant date fair market value | $ 12.08 | $ 14.19 | $ 18.67 | |
Volatility | [3] | 58.46% | 64.77% | 62.33% |
Russell 2000 Index | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Grant date fair market value | $ 1,769.21 | $ 2,015.04 | $ 2,277.45 | |
Volatility | [3] | 27.08% | 31.75% | 30.69% |
[1] The correlation coefficient utilizes the same historical price data used to develop the volatility assumptions. The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bill, commensurate with the three-year performance period. Expected volatility is calculated over the most recent period that represents the remaining term of the performance period as of the valuation date, or three years . |
Stockholders' Equity - Share _2
Stockholders' Equity - Share Based Payment Award Performance Shares Valuation Assumptions (Parenthetical) (Detail) | 12 Months Ended |
Apr. 30, 2024 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance based restricted stock unit performance period | 3 years |
PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Performance based restricted stock unit performance period | 3 years |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Activity for Unvested RSUs and PSUs (Detail) - RSUs and PSUs - $ / shares | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Summary of activity in unvested restricted stock units and performance share units | |||
RSUs and PSUs outstanding, beginning of period | 932,705 | 830,813 | 995,879 |
RSUs and PSUs, Awarded | 533,940 | 425,390 | 301,880 |
RSUs and PSUs, Released | (283,813) | (288,319) | (368,550) |
RSUs and PSUs, Forfeited | (182,485) | (35,179) | (98,396) |
RSUs and PSUs outstanding, end of period | 1,000,347 | 932,705 | 830,813 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | |||
Weighted Average Grant Date Fair Value, RSUs and PSUs outstanding, beginning of period | $ 13.14 | $ 13.3 | $ 11.14 |
Weighted Average Grant Date Fair Value, Awarded | 12.07 | 13.52 | 18.95 |
Weighted Average Grant Date Fair Value, Released | 11.54 | 13.92 | 11.99 |
Weighted Average Grant Date Fair Value, Forfeited | 10.83 | 15.17 | 12.29 |
Weighted Average Grant Date Fair Value, RSUs and PSUs outstanding, end of period | $ 13.45 | $ 13.14 | $ 13.3 |
Stockholders' Equity - Summar_3
Stockholders' Equity - Summary of Activity for Unvested RSUs and PSUs (Parenthetical) (Details) - shares | 12 Months Ended | |
Apr. 30, 2023 | Apr. 30, 2020 | |
PSUs | ||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Stock unit vested | 55,726 | 28,800 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Assumptions used in Valuing ESPP Purchases (Detail) - Employee Stock Purchase Plan | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Risk-free interest rate | 5.225% | 4.301% | 0.682% |
Expected term | 6 months | 6 months | 6 months |
Expected volatility | 45.69% | 49.18% | 60.62% |
Dividend yield | 3.27% | 3.59% | 1.85% |
Employer Sponsored Benefit Pl_2
Employer Sponsored Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Contributory Defined Investment Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution plan, employee contribution percentage | 100% | ||
Defined contribution plan, matching contribution percentage | 6% | ||
Deferred compensation plan description | We offer two contributory defined investment plans covering substantially all employees, subject to service requirements. Employees may contribute up to 100% of their annual pay, depending on the plan. We generally make discretionary matching contributions of up to 50% of the first 6% of employee contributions to the plan. | ||
Employer contribution to defined benefit plan | $ 2.7 | $ 2.6 | $ 2.9 |
Contributory Defined Investment Plan | Maximum | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Defined contribution plan, matching contribution percentage of match | 50% | ||
Nonelective Contribution Sharing Plan | |||
Defined Contribution Plan Disclosure [Line Items] | |||
Employer contribution to defined benefit plan | 8.2 | $ 13.5 | |
Defined contribution plan expected contribution | $ 9.1 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense/(Benefit) from Continuing Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Current: | |||
Federal | $ 6,315 | $ 16,259 | $ 52,843 |
State | 2,637 | 1,955 | 7,174 |
Total current | 8,952 | 18,214 | 60,017 |
Deferred: | |||
Federal | 2,558 | (6,217) | (1,889) |
State | (1,723) | (647) | (236) |
Total deferred | 835 | (6,864) | (2,125) |
Total income tax expense | $ 9,787 | $ 11,350 | $ 57,892 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Provision for Income Taxes from Continuing Operations (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | Apr. 30, 2022 | |
Income Tax Disclosure [Abstract] | |||
Federal income taxes expected at the statutory rate | $ 10,373 | $ 10,127 | $ 53,001 |
State income taxes, net of federal tax effects | (225) | 1,023 | 5,503 |
Stock compensation | 467 | 136 | (749) |
Business meals and entertainment | 100 | 89 | 118 |
Research and development tax credit | (281) | (265) | (300) |
Amendments to prior year returns | (1,176) | 0 | 0 |
Other | 529 | 240 | 319 |
Total income tax expense | $ 9,787 | $ 11,350 | $ 57,892 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets (Liabilities) Related to Temporary Differences (Detail) - USD ($) $ in Thousands | Apr. 30, 2024 | Apr. 30, 2023 |
Deferred Tax Assets, Net [Abstract] | ||
Inventory reserves | $ 8,489 | $ 7,495 |
Accrued expenses, including compensation | 4,678 | 4,764 |
Net operating loss carryforwards and tax credits | 3,988 | 3,156 |
Operating lease liability | 240 | 473 |
Product liability | 191 | 596 |
Workers' compensation | 704 | 477 |
State bonus depreciation | 1,812 | 755 |
Warranty reserve | 1,017 | 913 |
Stock-based compensation | 1,319 | 1,551 |
Section 174 capitalized R&D expense | 2,502 | 1,549 |
Other | 820 | 622 |
Total deferred tax assets before valuation allowance | 25,760 | 22,351 |
Valuation allowance | (3,350) | (3,031) |
Net deferred tax assets | 22,410 | 19,320 |
Deferred Tax Liabilities | ||
Operating lease right-of-use assets | (197) | (420) |
Property, plant, and equipment | (12,426) | (8,847) |
Intangible assets | (2,270) | (1,581) |
Other | (268) | (387) |
Deferred Tax Liabilities, Net, Total | (15,161) | (11,235) |
Net Deferred Tax Asset/(Liability) | $ 7,249 | $ 8,085 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Income Tax Contingency [Line Items] | ||
Federal income taxes, expected statutory rate | 21% | |
Effective income tax rate, provisions (benefit) | 19.80% | 23.50% |
Accrued interest and penalties | $ 0 | |
Gross tax-effected unrecognized tax benefits | 0 | |
Federal | ||
Income Tax Contingency [Line Items] | ||
Net operating loss carryforwards | 0 | |
State | ||
Income Tax Contingency [Line Items] | ||
Net operating loss carryforwards | 27,100,000 | $ 17,700,000 |
Tax credit carryforwards | $ 3,300,000 | 2,800,000 |
State tax credit carryforwards expire date | Apr. 30, 2049 | |
Valuation allowances for net operating loss carryforward | $ 1,400,000 | 957,000 |
Valuation allowances for tax credits | $ 1,900,000 | $ 2,200,000 |
State | Minimum | ||
Income Tax Contingency [Line Items] | ||
Operating loss carry forwards expiration dates | Apr. 30, 2027 | |
State | Maximum | ||
Income Tax Contingency [Line Items] | ||
Operating loss carry forwards expiration dates | Apr. 30, 2040 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Sep. 30, 2021 USD ($) | Jan. 31, 2018 USD ($) | Apr. 30, 2024 USD ($) Claim Plaintiff | Apr. 30, 2024 CAD ($) Claim Plaintiff | Apr. 30, 2023 USD ($) | Apr. 30, 2022 USD ($) | Feb. 02, 2023 USD ($) | |
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Compensatory damages sought | $ 18,600,000 | ||||||
Number of Product liability cases | Claim | 1 | 1 | |||||
Number of Other product liability claims | Claim | 5 | 5 | |||||
Year of other product liability claim | December 2019 | December 2019 | |||||
Defense and administrative costs | $ 320,000 | $ 988,000 | $ 729,000 | ||||
Settlement fees related to product liability cases | 0 | ||||||
Expense related to changes in product liability and municipal litigation liability | 35,000 | 176,000 | $ 1,200,000 | ||||
Accrued settlement fees | 1,600,000 | ||||||
Aggregate estimated capital expenditure | 120,000,000 | ||||||
Environmental reserve in non-current liabilities | 0 | 0 | |||||
Construction Contract Cost | $ 114,000,000 | ||||||
Cost Of Machinery And Equipment Due Remainder | 170,000,000 | ||||||
Cost Of Machinery And Equipment | 160,000,000 | ||||||
Capital expenditures incurred | $ 157,000,000 | ||||||
IDB [Member] | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Terms of commitment | Blount County and the cities of Alcoa and Maryville, Tennessee, a public, nonprofit corporation organized and existing under the laws of the state of Tennessee, or the IDB. Pursuant to the Project Agreement, we represented to the IDB that we intend to incur, or cause to be incurred, no less than $120.0 million in aggregate capital expenditures on or before December 31, 2025, create no less than 620 new jobs, and sustain an average hourly wage of at least $25.97 at the facility. Further, pursuant to the Project Agreement, we are required to, among other things, (A) execute a facility lease and an equipment lease with the IDB; (B) cause the construction of the new facility at our sole cost and expense to commence on or before May 31, 2022; (C) incur, or cause to be incurred, aggregate capital expenditures in connection with the construction and equipping of the new facility in an aggregate amount of not less than $120.0 million on or before December 31, 2025; (D) cause the construction of the new facility to be substantially completed and for a certificate of occupancy to be issued therefore on or before December 31, 2023; (E) provide the IDB with a written report certified by one of our authorized officers, not later than January 31 of each year during the period between January 31, 2024 and January 31, 2031; and (F) make certain payments to IDB in the event that our actual capital expenditures, number of employees, or average hourly wage of such employees are less than our projections. | Blount County and the cities of Alcoa and Maryville, Tennessee, a public, nonprofit corporation organized and existing under the laws of the state of Tennessee, or the IDB. Pursuant to the Project Agreement, we represented to the IDB that we intend to incur, or cause to be incurred, no less than $120.0 million in aggregate capital expenditures on or before December 31, 2025, create no less than 620 new jobs, and sustain an average hourly wage of at least $25.97 at the facility. Further, pursuant to the Project Agreement, we are required to, among other things, (A) execute a facility lease and an equipment lease with the IDB; (B) cause the construction of the new facility at our sole cost and expense to commence on or before May 31, 2022; (C) incur, or cause to be incurred, aggregate capital expenditures in connection with the construction and equipping of the new facility in an aggregate amount of not less than $120.0 million on or before December 31, 2025; (D) cause the construction of the new facility to be substantially completed and for a certificate of occupancy to be issued therefore on or before December 31, 2023; (E) provide the IDB with a written report certified by one of our authorized officers, not later than January 31 of each year during the period between January 31, 2024 and January 31, 2031; and (F) make certain payments to IDB in the event that our actual capital expenditures, number of employees, or average hourly wage of such employees are less than our projections. | |||||
Average hourly wage | $ 25.97 | ||||||
Minimum | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Compensatory damages sought | $ 75,000 | ||||||
Maximum | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Compensatory damages sought | 50,000,000 | ||||||
Settlement fees related to product liability cases | $ 1,600,000 | $ 1,500,000 | |||||
Putative Class | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Number of plaintiffs | Plaintiff | 2 | 2 | |||||
Putative Class | General Damages | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Aggregate damages claims | $ 50 | ||||||
Putative Class | Compensatory or Punitive Damages | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Aggregate damages claims | $ 100 | ||||||
Equipment [Member] | |||||||
Schedule Of Commitments And Contingencies [Line Items] | |||||||
Asset impairment charges | $ 1,900,000 | ||||||
Remaining net book value | $ 2,900,000 |
Restructuring - Components of R
Restructuring - Components of Restructuring Charges (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Apr. 30, 2024 | Apr. 30, 2023 | ||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | $ 7,053 | $ 8,261 | |
Cost of sales | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 2,116 | 3,923 | |
Research and development | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 0 | 3 | |
Selling, marketing, and distribution | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 2,974 | 1,055 | |
General and administrative | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 1,963 | 3,280 | |
Office Rent and Equipment | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 2,298 | 229 | |
Employee Relations | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 2,011 | 349 | |
Consulting Services | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 992 | 473 | |
Public relations | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 904 | 0 | |
Relocation | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | [1] | 887 | 2,856 |
Freight [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | 199 | 0 | |
Severance and Employee-Related Benefits | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring charges | [1] | $ (238) | $ 4,354 |
[1] Recorded in accrued payroll and incentives |
Restructuring - Summary of acti
Restructuring - Summary of activity in the Severance and employee-related benefits and Relocation accruals (Details) $ in Thousands | 12 Months Ended | |
Apr. 30, 2024 USD ($) | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | $ 11,800 | |
Charges | 649 | |
Cash payments and settlements | (6,094) | |
Restructuring Reserve, Ending Balance | 6,355 | [1] |
Severance and employee relateds benefits | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 10,054 | |
Charges | (238) | |
Cash payments and settlements | (4,289) | |
Restructuring Reserve, Ending Balance | 5,527 | [1] |
Relocation | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve, Beginning Balance | 1,746 | |
Charges | 887 | |
Cash payments and settlements | (1,805) | |
Restructuring Reserve, Ending Balance | $ 828 | [1] |
[1] Recorded in accrued payroll and incentives |
Restructuring (Additional Infor
Restructuring (Additional Information) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Apr. 30, 2024 | Apr. 30, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 7,053 | $ 8,261 |
Cost of Goods Sold [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 2,116 | $ 3,923 |