Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Jul. 31, 2019 | Aug. 27, 2019 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jul. 31, 2019 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | AMERICAN OUTDOOR BRANDS CORP | |
Entity Central Index Key | 0001092796 | |
Current Fiscal Year End Date | --04-30 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity File Number | 001-31552 | |
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 Address, State or Province | MA | |
Entity Address, Postal Zip Code | 01104 | |
City Area Code | 800 | |
Local Phone Number | 331-0852 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Common Stock, Shares Outstanding | 54,821,771 | |
Title of each Class | Common Stock, par value $.001 per share | |
Trading Symbol | AOBC | |
Name of exchange on which registered | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 30,732 | $ 41,015 |
Accounts receivable, net of allowance for doubtful accounts of $2,294 on July 31, 2019 and $1,899 on April 30, 2019 | 70,242 | 84,907 |
Inventories | 195,448 | 163,770 |
Prepaid expenses and other current assets | 9,350 | 6,528 |
Income tax receivable | 2,140 | 2,464 |
Total current assets | 307,912 | 298,684 |
Property, plant, and equipment, net | 174,355 | 183,268 |
Intangibles, net | 87,113 | 91,840 |
Goodwill | 182,267 | 182,269 |
Other assets | 20,808 | 10,728 |
Assets, Total | 772,455 | 766,789 |
Current liabilities: | ||
Accounts payable | 29,549 | 35,584 |
Accrued expenses and deferred revenue | 35,750 | 39,322 |
Accrued payroll and incentives | 10,598 | 21,473 |
Accrued income taxes | 248 | 175 |
Accrued profit sharing | 3,516 | 2,830 |
Accrued warranty | 4,987 | 5,599 |
Current portion of notes and loans payable | 79,800 | 6,300 |
Total current liabilities | 164,448 | 111,283 |
Deferred income taxes | 9,683 | 9,776 |
Notes and loans payable, net of current portion | 99,467 | 149,434 |
Finance lease payable, net of current portion | 40,708 | 45,400 |
Other non-current liabilities | 15,091 | 6,452 |
Total liabilities | 329,397 | 322,345 |
Commitments and contingencies (Note 10) | ||
Stockholders’ equity: | ||
Preferred stock, $.001 par value, 20,000,000 shares authorized, no shares issued or outstanding | ||
Common stock, $.001 par value, 100,000,000 shares authorized, 72,987,388 issued and 54,820,526 shares outstanding on July 31, 2019 and 72,863,624 shares issued and 54,696,762 shares outstanding on April 30, 2019 | 73 | 73 |
Additional paid-in capital | 264,230 | 263,180 |
Retained earnings | 400,838 | 402,946 |
Accumulated other comprehensive income | 292 | 620 |
Treasury stock, at cost (18,166,862 shares on July 31, 2019 and April 30, 2019) | (222,375) | (222,375) |
Total stockholders’ equity | 443,058 | 444,444 |
Liabilities and Equity, Total | $ 772,455 | $ 766,789 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Statement Of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 2,294 | $ 1,899 |
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 | 72,987,388 | 72,863,624 |
Common stock, shares outstanding | 54,820,526 | 54,696,762 |
Treasury stock, shares | 18,166,862 | 18,166,862 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of (Loss)/Income and Comprehensive (Loss)/Income - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | ||
Income Statement [Abstract] | |||
Net sales | [1] | $ 123,665 | $ 138,833 |
Cost of sales | [1] | 75,811 | 86,411 |
Gross profit | [1] | 47,854 | 52,422 |
Operating expenses: | |||
Research and development | 3,229 | 2,810 | |
Selling, marketing, and distribution | 16,773 | 11,615 | |
General and administrative | 26,709 | 24,521 | |
Total operating expenses | 46,711 | 38,946 | |
Operating income | [1] | 1,143 | 13,476 |
Other (expense)/income, net: | |||
Other income/(expense), net | 5 | (18) | |
Interest expense, net | (2,627) | (2,001) | |
Total other (expense)/income, net | (2,622) | (2,019) | |
(Loss)/income from operations before income taxes | (1,479) | 11,457 | |
Income tax expense | [1] | 629 | 3,812 |
Net (loss)/income | (2,108) | 7,645 | |
Comprehensive (loss)/income: | |||
Change in unrealized loss on interest rate swap | (420) | (104) | |
Other comprehensive loss, before income taxes | (420) | (104) | |
Income tax benefit on other comprehensive loss | 92 | 27 | |
Other comprehensive loss, net of tax | (328) | (77) | |
Comprehensive (loss)/income: | $ (2,436) | $ 7,568 | |
Net (loss)/income per share: | |||
Basic | $ (0.04) | $ 0.14 | |
Diluted | $ (0.04) | $ 0.14 | |
Weighted average number of common shares outstanding: | |||
Basic | 54,783 | 54,345 | |
Diluted | 54,783 | 54,931 | |
[1] | We allocate all of corporate overhead expenses except for interest and income taxes, such as general and administrative expenses and other corporate-level expenses, to both our Firearms and Outdoor Products & Accessories segments. |
Condensed Consolidated Statem_2
Condensed Consolidated Statement 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, 2018 | $ 422,148 | $ 72 | $ 253,616 | $ 389,146 | $ 1,689 | $ (222,375) |
Balance (in shares) at Apr. 30, 2018 | 72,434,000 | |||||
Treasury stock, shares at Apr. 30, 2018 | 18,167,000 | |||||
Proceeds from exercise of employee stock options | $ 139 | 139 | ||||
Proceeds from exercise of employee stock options (in shares) | 17,399 | 17,000 | ||||
Stock-based compensation | $ 1,990 | 1,990 | ||||
Change in unrealized loss on interest rate swap, net of tax effect | (77) | (77) | ||||
Impact of adoption of accounting standard updates | (4,610) | (4,610) | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered | (555) | $ 1 | (556) | |||
Issuance of common stock under restricted stock unit awards, net of shares surrendered (in shares) | 100,000 | |||||
Net income (loss) | 7,645 | 7,645 | ||||
Balance at Jul. 31, 2018 | 426,680 | $ 73 | 255,189 | 392,181 | 1,612 | $ (222,375) |
Balance (in shares) at Jul. 31, 2018 | 72,551,000 | |||||
Treasury stock, shares at Jul. 31, 2018 | 18,167,000 | |||||
Balance at Apr. 30, 2019 | $ 444,444 | $ 73 | 263,180 | 402,946 | 620 | $ (222,375) |
Balance (in shares) at Apr. 30, 2019 | 54,696,762 | 72,864,000 | ||||
Treasury stock, shares at Apr. 30, 2019 | 18,166,862 | 18,167,000 | ||||
Proceeds from exercise of employee stock options (in shares) | 0 | |||||
Stock-based compensation | $ 1,588 | 1,588 | ||||
Change in unrealized loss on interest rate swap, net of tax effect | (328) | (328) | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered | (538) | (538) | ||||
Issuance of common stock under restricted stock unit awards, net of shares surrendered (in shares) | 124,000 | |||||
Net income (loss) | (2,108) | (2,108) | ||||
Balance at Jul. 31, 2019 | $ 443,058 | $ 73 | $ 264,230 | $ 400,838 | $ 292 | $ (222,375) |
Balance (in shares) at Jul. 31, 2019 | 54,820,526 | 72,988,000 | ||||
Treasury stock, shares at Jul. 31, 2019 | 18,166,862 | 18,167,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Cash flows from operating activities: | ||
Net (loss)/income | $ (2,108) | $ 7,645 |
Adjustments to reconcile net income to net cash (used in)/provided by operating activities: | ||
Depreciation and amortization | 14,346 | 12,852 |
Loss on sale/disposition of assets | 7 | |
Provision for losses on notes and accounts receivable | 634 | 55 |
Deferred income taxes | (1,520) | |
Stock-based compensation expense | 1,588 | 1,990 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 14,031 | 15,208 |
Inventories | (31,678) | (13,538) |
Prepaid expenses and other current assets | (2,822) | (2,363) |
Income taxes | 397 | 3,892 |
Accounts payable | (6,015) | (3,921) |
Accrued payroll and incentives | (10,875) | (653) |
Accrued profit sharing | 686 | 254 |
Accrued expenses and deferred revenue | (6,675) | (8,568) |
Accrued warranty | (612) | (656) |
Other assets | 428 | (62) |
Other non-current liabilities | (463) | 17 |
Net cash (used in)/provided by operating activities | (29,138) | 10,639 |
Cash flows from investing activities: | ||
Payments to acquire patents and software | (123) | (190) |
Proceeds from sale of property and equipment | 1 | |
Payments to acquire property and equipment | (3,695) | (6,919) |
Net cash used in investing activities | (3,818) | (7,108) |
Cash flows from financing activities: | ||
Proceeds from loans and notes payable | 25,000 | |
Payments on finance lease obligation | (214) | (161) |
Payments on notes and loans payable | (1,575) | (26,575) |
Proceeds from exercise of options to acquire common stock | 139 | |
Payment of employee withholding tax related to restricted stock units | (538) | (556) |
Net cash provided by/(used in) financing activities | 22,673 | (27,153) |
Net decrease in cash and cash equivalents | (10,283) | (23,622) |
Cash and cash equivalents, beginning of period | 41,015 | 48,860 |
Cash and cash equivalents, end of period | 30,732 | 25,238 |
Supplemental disclosure of cash flow information Cash paid for: | ||
Interest | 1,690 | 1,220 |
Income taxes | 235 | 484 |
Supplemental Disclosure of Non-cash Investing and Financing Activities: | ||
Purchases of property and equipment included in accounts payable | 547 | 4,332 |
Purchases of property and equipment funded by capital lease | 12,074 | |
Capital lease obligation | 12,074 | |
Changes in other assets for operating lease obligations | 10,928 | |
Impact of adoption of accounting standard updates | $ (4,610) | |
Changes in lease liabilities for operating lease obligations | 11,970 | |
ASU 2016-02 | Change in Property and Equipment | ||
Supplemental Disclosure of Non-cash Investing and Financing Activities: | ||
Impact of adoption of accounting standard updates | 3,201 | |
ASU 2016-02 | Changes in Finance Lease Liabilities | ||
Supplemental Disclosure of Non-cash Investing and Financing Activities: | ||
Impact of adoption of accounting standard updates | $ (4,245) |
Organization
Organization | 3 Months Ended |
Jul. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization | (1) Organization: We are a leading manufacturer, designer, and provider of consumer products for the shooting, hunting, and rugged outdoor enthusiast. We are one of the largest manufacturers of handguns, modern sporting rifles, and handcuffs in the United States and an active participant in the hunting rifle and suppressor markets. We are also a leading provider of shooting, hunting, and rugged outdoor products and accessories, including knives and cutting tools, sighting lasers, shooting supplies, tree saws, and survival gear. In our Firearms segment, we manufacture a wide array of handguns (including revolvers and pistols), long guns (including modern sporting rifles, bolt action rifles, and muzzleloaders), handcuffs, suppressors, and other firearm-related products for sale to a wide variety of customers, including gun 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 firearm products under the Smith & Wesson, M&P, Performance Center, Thompson/Center Arms, and Gemtech brands. We manufacture our firearm products at our facilities in Springfield, Massachusetts; Houlton, Maine; and Deep River, Connecticut. We also sell our manufacturing services to other businesses to level-load our factories. We sell those services under our Smith & Wesson and Smith & Wesson Precision Components brands. In our Outdoor Products & Accessories segment, we design, source, distribute, and manufacture reloading, gunsmithing, and gun cleaning supplies; high-quality stainless steel cutting tools and accessories; flashlights; tree saws and related trimming accessories; shooting supplies, rests, and other related accessories; fishing accessories; apparel; vault accessories; laser grips and laser sights; and a full range of products for survival and emergency preparedness. We sell our products under the Caldwell, Crimson Trace, Wheeler, Tipton, Frankford Arsenal, Schrade, Imperial, Uncle Henry, BUBBA, UST, Lockdown, Hooyman, BOG, Old Timer, LaserLyte, and KeyGear brands. We also offer firearms and non-firearms accessories, such as flashlights and knives, under our brands in our firearms business, including Smith & Wesson, M&P, Performance Center, and Thompson/Center Arms. We develop and market our outdoor products and accessories at our facilities in Columbia, Missouri and Wilsonville, Oregon. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Jul. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | (2) Basis of Presentation: Interim Financial Information – The condensed consolidated balance sheet as of July 31, 2019, the condensed consolidated statements of (loss)/income and comprehensive (loss)/income for the three months ended July 31, 2019 and 2018, the condensed consolidated statement of changes in stockholders’ equity for the three months ended July 31, 2019, and the condensed consolidated statements of cash flows for the three months ended July 31, 2019 and 2018 have been prepared by us without audit. 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 July 31, 2019 and for the periods presented, have been included. All intercompany transactions have been eliminated in consolidation. The consolidated balance sheet as of April 30, 2019 has been derived from our audited consolidated financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended April 30, 2019. The results of operations for the three months ended Revenue Recognition - We recognize revenue in accordance with the provisions of Accounting Standards Update, or ASU, (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 that entitle customers to receive free goods based upon their purchase of our products. The fulfillment of these free goods are 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 proportionally as each performance obligation is satisfied, based on the relative transaction price of each product. The net change in contract liabilities for a given period is reported as an increase or decrease to sales. Our product sales are generally sold free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 90 days of product shipment with a discount available to some customers for early payment. For contracts with discounted terms, we determine the transaction price upon establishment of the contract that contains the final terms of the sale, including the 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. In some instances, we provide longer payment terms, particularly as it relates to our hunting dating programs, which represent payment terms due in the fall for certain orders of hunting products received in the spring and summer. 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. Recently Issued Accounting Standards – In February 2016, the FASB issued ASU 2016-02, (Topic 842), or ASU 2016-02, which amends the existing guidance to require lessees to recognize right-of-use assets and lease liabilities in a classified balance sheet. The most prominent among the changes in the standard is the requirement for lessees to recognize right-of-use assets and lease liabilities for those leases classified as operating leases under current U.S. GAAP. The requirements of this ASU are effective for financial statements for annual periods beginning after December 15, 2018, and early adoption is permitted. We utilized leasing software to assist us in the accounting and tracking of leases and used the optional transitional method allowed by ASU 2018-11, Leases (Topic 842 Targeted Improvements. Under this method, we applied the standard using the modified retrospective method with an adoption date of May 1, 2019. We elected to use the package of practical expedients, which permits us to not reassess certain lease contract provisions. We adopted ASU 2016-02 effective May 1, 2019 and recognized right-of-use assets of $11.5 million, lease liabilities of $12.8 million. The difference between the right-of-use assets and the lease liabilities of $1.3 million is a result of the reclassification of deferred rent and lease incentive liabilities primarily relating to our real estate operating leases into the right-of use assets, which had no impact to retained earnings. See also Note 3 – , for more information. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses |
Leases
Leases | 3 Months Ended |
Jul. 31, 2019 | |
Leases [Abstract] | |
Leases | (3) Leases: We lease certain of our real estate, machinery, photocopiers, and vehicles under non-cancelable operating lease agreements. On May 1, 2019, we adopted ASU No. 2016-02, Leases Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. Our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. Our lease agreements do not require material variable lease payments, residual value guarantees, or restrictive covenants. For operating leases, expense is recognized on a straight-line basis over the lease term. Tenant improvement allowances are recorded as an offsetting adjustment included in our calculation of its right-of-use asset. Many of our leases include renewal options that can extend the lease term. The execution of those renewal options is at our sole discretion and 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 July 31, 2019 are as follows (in thousands): Balance Sheet Caption July 31, 2019 Operating Leases Right-of-use assets $ 10,928 Accumulated amortization (643 ) Right-of-use assets, net Other assets $ 10,285 Current liabilities Accrued expenses and deferred revenue $ 2,726 Non-current liabilities Other non-current liabilities 8,778 Total operating lease liabilities $ 11,504 Finance Leases Right-of-use assets $ 41,070 Accumulated depreciation (551 ) Right-of-use assets, net Property, plant, and equipment, net $ 40,519 Current liabilities Accrued expenses and deferred revenue 914 Non-current liabilities Finance lease payable, net of current portion 40,708 Total finance lease liabilities $ 41,622 We recorded $1.0 million of operating lease costs, of which $200,000 were short-term operating lease costs, $535,000 of financing lease amortization, and $520,000 of financing lease interest expense during the three months ended July 31, 2019. As of July 31, 2019, our weighted average lease term and weighted average discount rate for our operating leases was 4.8 years and 4.6%, respectively. As of July 31, 2019, our weighted average lease term and weighted average discount rate for our financing leases was 19.0 years and 5.0%, respectively, and consists primarily of our national logistics facility located in Columbia, Missouri. 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. Future lease payments for all our operating and finance leases for succeeding fiscal years is as follows (in thousands): Operating Financing Total 2020 $ 2,503 $ 2,230 $ 4,733 2021 2,874 3,016 5,890 2022 2,712 3,056 5,768 2023 2,582 3,071 5,653 2024 1,537 3,125 4,662 2025 268 3,180 3,438 Thereafter 680 48,853 49,543 Total future lease payments 13,156 66,531 79,687 Less amounts representing interest (1,652 ) (24,909 ) (26,561 ) Present value of lease payments 11,504 41,622 53,126 Less current maturities of lease liabilities (2,726 ) (914 ) (3,640 ) Long-term maturities of lease liabilities $ 8,778 $ 40,708 $ 49,486 During the three months ended July 31, 2019, the cash paid for amounts included in the measurement of the liabilities and the operating cash flows was $1.4 million. |
Revenue Recognition and Contrac
Revenue Recognition and Contracts with Customers | 3 Months Ended |
Jul. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Revenue Recognition and Contracts with Customers | (4) Revenue Recognition and Contracts with Customers: On May 1, 2018, we adopted ASU 2014-09 Revenue from Contracts with Customers sheet, for outstanding performance obligations related to sales promotions. When evaluating our performance obligations, we disaggregate revenue based on major product lines , which correlate with our reportab le segments disclose d in Note 1 1 — Segment Reporting. Also, domestic sales account for 95 % of our total net sales. There are no significant judgments or estimates used in the determination of performance obligations , and the transaction price for the performance obligations are allocated on a pro-rata basis. There are no other contract costs that need to be considered based on the nature of our performance obligations. The following table outlines the impact of the adoption of ASU 2014-09 on revenue recognized during the three-month periods ended July 31, 2019 and 2018 (in thousands): July 31, 2019 July 31, 2018 Outstanding performance obligations at beginning of period $ 12,213 $ 23,305 Revenue recognized (14,571 ) (13,998 ) Revenue deferred 5,472 4,314 Outstanding performance obligations at end of period $ 3,114 $ 13,621 During the three months ended July 31, 2019, we recognized $14.6 million of deferred revenue, most of which was previously deferred as of April 30, 2019, as the performance obligations relating to sales promotions were satisfied. This recognition of revenue was partially offset by $5.5 million of additional deferred revenue for outstanding performance obligations relating to sales promotions that have not been satisfied, which was recorded to accrued expenses in the condensed consolidation balance sheet. This resulted in a $9.1 million net increase in revenue during the three months ended July 31, 2019. We estimate that revenue from the outstanding performance obligations as of July 31, 2019 will be recognized during fiscal 2020. During the three months ended July 31, 2018, we recognized $14.0 million of revenue previously deferred as of May 1, 2018, the date we adopted ASU 2014-09, as the performance obligations relating to sales promotions were satisfied. This recognition of revenue was partially offset by $4.3 million of additional deferred revenue for outstanding performance obligations relating to sales promotions that have not been satisfied, which was recorded to accrued expenses in the condensed consolidated balance sheet. This resulted in a $9.7 million net increase in revenue during the three months ended July 31, 2018. This resulted in an outstanding performance obligation liability of $13.6 million that is recorded in accrued expenses in the condensed consolidated balance sheet. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Jul. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | (5) Goodwill and Intangible Assets: The changes in the carrying amount of goodwill for the three months ended July 31, 2019 by reporting segment were as follows: Outdoor Products & Firearms Segment Accessories Segment Total Goodwill Balance as of April 30, 2019 $ 19,024 $ 163,245 $ 182,269 Adjustments — (2 ) (2 ) Balance as of July 31, 2019 $ 19,024 $ 163,243 $ 182,267 See Note 11 — Segment Reporting The following table presents a summary of intangible assets as of July 31, 2019 and April 30, 2019 (in thousands): July 31, 2019 April 30, 2019 Gross Gross Carrying Accumulated Net Carrying Carrying Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Customer relationships $ 92,560 $ (44,478 ) $ 48,082 $ 92,560 $ (41,643 ) $ 50,917 Developed technology 21,230 (10,947 ) 10,283 21,230 (10,428 ) 10,802 Patents, trademarks, and trade names 57,659 (29,974 ) 27,685 57,477 (28,479 ) 28,998 Backlog 1,150 (1,150 ) — 1,150 (1,150 ) — 172,599 (86,549 ) 86,050 172,417 (81,700 ) 90,717 Patents in progress 837 — 837 897 — 897 Total definite-lived intangible assets 173,436 (86,549 ) 86,887 173,314 (81,700 ) 91,614 Indefinite-lived intangible assets 226 — 226 226 — 226 Total intangible assets $ 173,662 $ (86,549 ) $ 87,113 $ 173,540 $ (81,700 ) $ 91,840 We amortize intangible assets with determinable lives over a weighted-average period of approximately five years. The weighted-average periods of amortization by intangible asset class is approximately five years for customer relationships, six years for developed technology, and five years for patents, trademarks, and trade names. Amortization expense, excluding amortization of deferred financing costs, amounted to $4.8 million and $5.4 million for the three months ended July 31, 2019 and 2018, respectively. Estimated amortization expense of intangible assets for the remainder of fiscal 2020 and succeeding fiscal years is as follows (in thousands): Fiscal Amount 2020 $ 14,415 2021 16,604 2022 14,218 2023 11,849 2024 10,102 Thereafter 18,862 Total $ 86,050 |
Notes, Loans Payable, and Finan
Notes, Loans Payable, and Financing Arrangements | 3 Months Ended |
Jul. 31, 2019 | |
Debt Disclosure [Abstract] | |
Notes, Loans Payable, and Financing Arrangements | (6) Notes, Loans Payable, and Financing Arrangements: Credit Facilities – On June 15, 2015, we and certain of our domestic subsidiaries entered into an unsecured credit facility, or the Credit Agreement, with TD Bank, N.A. and other lenders, or the Lenders, which included a $175.0 million revolving line of credit, or the Revolving Line, and a $105.0 million term loan, or the Term Loan, of which $79.8 million remained outstanding as of July 31, 2019. The Revolving Line provides for availability for general corporate purposes, with borrowings to bear interest at a variable rate equal to LIBOR or prime plus an applicable margin based on our consolidated leverage ratio, at our election. On October 27, 2016, we entered into a second amendment to our Credit Agreement, or the Second Amendment, which, among other things, increased the Revolving Line to $350.0 million, increased the option to expand the credit commitment to an additional $150.0 million, and extended the maturity of the Revolving Line from June 15, 2020 to October 27, 2021. Other than the changes described in the Second Amendment, we otherwise remain subject to the terms of the Credit Agreement, as described below. As of July 31, 2019, we had $25.0 million of borrowings outstanding on the Revolving Line, which bore interest at 4.31%, which is equal to the LIBOR rate plus an applicable margin. The Term Loan, which bears interest at a variable rate, requires principal payments of $6.3 million per annum plus interest, payable quarterly. Any remaining outstanding amount under the Term Loan on the maturity date of June 15, 2020 will be due in full. We were required to obtain interest rate protection on the Term Loan covering not less than 75% of the aggregate outstanding principal balance of the Term Loan. Accordingly, on June 18, 2015, we entered into an interest rate swap agreement, which expires on June 15, 2020, that covered 100% of the $105.0 million of floating rate debt. On July 6, 2015, we executed an interest rate swap pursuant to such agreement, which requires us to pay interest at a defined rate of 1.56% while receiving interest at a defined variable rate equal to the one-month LIBOR rate. This swap, when combined with the applicable margin based on our consolidated leverage ratio, effectively fixed our interest rate on the Term Loan, which is subject to change based on changes in our consolidated leverage ratio. As of July 31, 201 9 , our interest rate on the Term Loan was %. As of July 31, 2019, the interest rate swap was considered effective and had no effect on earnings. The fair value of the interest rate swap on July 31, 2019 was an asset of $300,000, which was recorded in other assets on our condensed consolidated balance sheet. We do not expect the interest rate swap to have any material impact on earnings within the next 12 months. 2020 Senior Notes – On February 28, 2018, we issued an aggregate of $75.0 million of the 2020 Senior Notes to various institutional investors pursuant to the terms and conditions of an indenture, or the 2020 Senior Notes Indenture, and purchase agreements. The 2020 Senior Notes bear interest at a rate of 5.000% per annum payable on February 28 and August 28 of each year, beginning on August 28, 2018. We incurred $158,000 of debt issuance costs related to the issuance of the 2020 Senior Notes. As of February 28, 2019, we may, at our option, upon not less than 30 nor more than 60 days’ prior notice, redeem all or a portion of the 2020 Senior Notes at a redemption price of 100.000% of the principal amount of the 2020 Senior Notes to be redeemed plus accrued and unpaid interest as of the applicable redemption date. Subject to certain restrictions and conditions, we may be required to make an offer to repurchase the 2020 Senior Notes from the holders of the 2020 Senior Notes in connection with a change of control or disposition of assets. If not redeemed by us or repaid pursuant to the holders’ right to require repurchase, the 2020 Senior Notes mature on August 28, 2020. The 2020 Senior Notes are general, unsecured obligations of our company. The 2020 Senior Notes Indenture contains certain affirmative and negative covenants, including limitations on restricted payments (such as share repurchases, dividends, and early payment of indebtedness), limitations on indebtedness, limitations on the sale of assets, and limitations on liens. Payments that would otherwise be characterized as restricted payments are permitted under the 2020 Senior Notes Indenture in an amount not to exceed 50% of our consolidated net income for the period from the issue date to the date of the restricted payment, provided that at the time of making such payments, (a) no default has occurred or would result from the making of such payments, and (b) we are able to satisfy the debt incurrence test under the 2020 Senior Notes Indenture, or the 2020 Senior Notes Lifetime Aggregate Limit. In addition, the 2020 Senior Notes Indenture provides for other exceptions to the restricted payments covenant, each of which are independent of the 2020 Senior Notes Lifetime Aggregate Limit. Among such exceptions are (i) the ability to make share repurchases each fiscal year in an amount not to exceed the lesser of (A) $50.0 million in any fiscal year or (B) 75.0% of our consolidated net income for the previous four consecutive published fiscal quarters prior to the date of the determination of such consolidated net income, and (ii) share repurchases over the life of the 2020 Senior Notes in an aggregate amount not to exceed $75.0 million. The limitation on indebtedness in the 2020 Senior Notes Indenture is only applicable at such time that the consolidated coverage ratio (as set forth in the 2020 Senior Notes Indenture) for us and our restricted subsidiaries is less than 3.00 to 1.00. In general, as set forth in the 2020 Senior Notes Indenture, the consolidated coverage ratio is determined by comparing our prior four quarters’ consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) to our consolidated interest expense. The Credit Agreement for our credit facility contains financial covenants relating to maintaining maximum leverage and minimum debt service coverage. The 2020 Senior Notes Indenture contains a financial covenant relating to times interest earned. Letters of Credit – At July 31, 2019, we had outstanding letters of credit aggregating $1.0 million. |
Fair Value Measurement
Fair Value Measurement | 3 Months Ended |
Jul. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement | (7) Fair Value Measurement: We follow the provisions of ASC 820-10, Fair Value Measurements and Disclosures Topic Financial assets and liabilities recorded on the accompanying condensed 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 $30.7 million and $41.0 million as of July 31, 2019 and April 30, 2019, respectively. 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). The carrying value of our Term Loan approximated the fair value as of July 31, 2019 in considering Level 2 inputs within the hierarchy. The carrying value of our 2020 Senior Notes as of July 31, 2019 approximated the fair value in considering Level 2 inputs within the hierarchy as our 2020 Senior Notes are not frequently traded. The fair value of our interest rate swap was estimated by a third-party using inputs that are observable or that can be corroborated by observable market data, such as interest rate yield curves, and, therefore, is classified within Level 2 of the valuation hierarchy. For more information regarding the interest rate swap, refer to Note 6 — Notes, Loans Payable, and Financing Arrangements 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. The acquisition-related contingent consideration liability represents the estimated fair value of additional future earn-outs payable for acquisitions of businesses that included earn-out clauses. The valuation of the contingent consideration will be evaluated on an ongoing basis and is based on management estimates and entity-specific assumptions, which are considered Level 3 inputs. In connection with the Gemtech acquisition, up to a maximum of $17.1 million may be paid contingent upon the cumulative three-year sales volume of Gemtech products. The valuation of this contingent consideration liability was established in accordance with ASC 805 — Business Combinations |
Inventories
Inventories | 3 Months Ended |
Jul. 31, 2019 | |
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 July 31, 2019 and April 30, 2018 (in thousands): July 31, 2019 April 30, 2019 Finished goods $ 134,874 $ 108,247 Finished parts 41,727 36,181 Work in process 5,569 7,576 Raw material 13,278 11,766 Total inventories $ 195,448 $ 163,770 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Jul. 31, 2019 | |
Equity [Abstract] | |
Stockholders' Equity | (9) Stockholders’ Equity: Earnings per Share The following table provides a reconciliation of the net (loss)/income amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings per share for the three months ended July 31, 2019 and 2018 (in thousands, except per share data): For the Three Months Ended July 31, 2019 2018 Net Per Share Net Per Share Loss Shares Amount Income Shares Amount Basic earnings $ (2,108 ) 54,783 $ (0.04 ) $ 7,645 54,345 $ 0.14 Effect of dilutive stock awards — — — — 586 — Diluted earnings $ (2,108 ) 54,783 $ (0.04 ) $ 7,645 54,931 $ 0.14 All our outstanding stock options and restricted stock units, or RSUs, were included in the computation of diluted earnings per share for the three months ended July 31, 2019 and 2018. Incentive Stock and Employee Stock Purchase Plans We have two incentive stock plans: the 2004 Incentive Stock Plan and the 2013 Incentive Stock Plan. New grants under the 2004 Incentive Stock Plan have not been made since the approval of the 2013 Incentive Stock Plan at our September 23, 2013 annual meeting of stockholders. All new grants covering all participants are issued under the 2013 Incentive Stock Plan. Except in specific circumstances, grants vest over a period of three or four years and stock options are exercisable for a period of 10 years from the date of grant. The plan also permits the grant of awards to non-employees, which our board of directors has authorized in the past. The number of shares and weighted average exercise prices of stock options for the three months ended July 31, 2019 and 2018 were as follows: For the Three Months Ended July 31, 2019 2018 Weighted Weighted Average Average Shares Exercise Price Shares Exercise Price Options outstanding, beginning of year 267,761 $ 6.76 316,160 $ 6.69 Exercised during the period — — (17,399 ) 7.98 Options outstanding, end of period 267,761 $ 6.76 298,761 $ 6.61 Weighted average remaining contractual life 2.10 years 2.86 years Options exercisable, end of period 267,761 $ 6.76 298,761 $ 6.61 Weighted average remaining contractual life 2.10 years 2.86 years The aggregate intrinsic value of outstanding and exercisable stock options as of July 31, 2019 and 2018 was $770,000 and $853,000, respectively. There were no stock options exercised in the three months ended July 31, 2019. The aggregate intrinsic value of the stock options exercised in the three months ended July 31, 2018 was $76,000. At July 31, 2019, there was no unrecognized compensation expense relating to outstanding stock options. We have an Employee Stock Purchase Plan, or ESPP, in which each participant is granted an option to purchase our common stock on each subsequent exercise date during the offering period (as such terms are defined in the ESPP) in accordance with the terms of the ESPP. The total stock-based compensation expense, including stock options, purchases under our ESPP, RSUs, and performance-based RSUs, or PSUs, was $1.6 million and $2.0 million for the nine months ended July 31, 2019 and 2018, respectively. Stock-based compensation expense is included in cost of sales, sales and marketing, research and development, and general and administrative expenses. We grant service-based RSUs to employees and directors. The awards are made at no cost to the recipient. An RSU represents the right to receive one share of our common stock and does not carry voting or dividend rights. Except in specific circumstances, RSU grants to employees vest over a period of four years with one-fourth of the units vesting on each anniversary of the grant date. The aggregate fair value of our RSU grants is amortized to compensation expense over the vesting period. We grant PSUs to our executive officers and certain management employees who are not executive officers. The PSUs vest, and the fair value of such PSUs will be recognized, over the corresponding three-year performance period. During the three months ended July 31, 2019, we granted an aggregate of 131,771 service-based RSUs to non-executive officer employees. Compensation expense related to grants of RSUs and PSUs was $1.4 million for the three months ended July 31, 2019. During the three months ended July 31, 2019, we cancelled 123,025 PSUs as a result of the performance metric not being met and 15,805 service-based RSUs as a result of the service condition not being met. In connection with the vesting of RSUs, during the three months ended July 31, 2019, we delivered common stock to our employees, including our executive officers, with a total market value of $1.7 million. During the three months ended July 31, 2018, we granted an aggregate of 140,771 service-based RSUs to non-executive officer employees. Compensation expense related to grants of RSUs and PSUs was $1.8 million for the three months ended July 31, 2018. During the three months ended July 31, 2018, we cancelled 112,000 PSUs as a result of the performance metric not being met and 6,180 service-based RSUs as a result of the service condition not being met. In connection with the vesting of RSUs, during the three months ended July 31, 2018, we delivered common stock to our employees, including our executive officers with a total market value of $1.7 million. A summary of activity for unvested RSUs and PSUs for the three months ended July 31, 2019 and 2018 is as follows: For the Three Months Ended July 31, 2019 2018 Weighted Weighted Total # of Average Total # of Average Restricted Grant Date Restricted Grant Date Stock Units Fair Value Stock Units Fair Value RSUs and PSUs outstanding, beginning of period 1,631,631 $ 17.80 1,442,316 $ 17.80 Awarded 131,771 10.65 140,771 12.35 Vested (182,900 ) 19.11 (146,523 ) 18.78 Forfeited (138,830 ) 16.11 (118,180 ) 15.53 RSUs and PSUs outstanding, end of period 1,441,672 $ 15.44 1,318,384 $ 17.31 As of July 31, 2019, there was $7.3 million of unrecognized compensation expense related to unvested RSUs and PSUs. This expense is expected to be recognized over a weighted average remaining contractual term of 1.8 years. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Jul. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (10) Commitments and Contingencies: Litigation In January 2018, Gemini Technologies, Incorporated, or Gemini, commenced an action against us and Smith & Wesson Corp. in the United States District Court for the District of Idaho, or the District Court. The complaint alleges, among other things, that the defendants breached the earn-out and other provisions of the Asset Purchase Agreement and ancillary agreements between the parties in connection with Smith & Wesson Corp.’s 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 May 2018, the District Court dismissed the complaint on the grounds of forum non conveniens We are a defendant in eight product liability cases and are aware of six 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 on August 27, 1999 by the city of Gary, Indiana 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 trial court 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. On May 23, 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. On July 8, 2019, defendants filed a Petition to Transfer jurisdiction to the Indiana Supreme Court. A decision has not yet been issued by the court. In May 2018, we were named in an action related to the Parkland, Florida shooting, filed in the Circuit Court, Broward County, Florida, seeking a declaratory judgment that a Florida statute that provides firearm manufacturers and dealers immunity from liability when their legally manufactured and lawfully sold firearms are later used in criminal acts only applies to civil actions commenced by governmental agencies not private litigants. In August 2018, we moved to dismiss the complaint on the grounds that it seeks an impermissible advisory opinion. On December 6, 2018, the court granted defendants’ motion to dismiss without prejudice and granted plaintiffs leave to amend their complaint. On December 10, 2018, plaintiffs filed a Second Amended Complaint for Declaratory Relief. On December 13, 2018, defendants filed a Motion to Dismiss Plaintiffs’ Second Amended Complaint. A hearing was held on defendants’ second motion to dismiss on December 17, 2018. A decision has not yet been issued by the court. On July 31, 2019, our competitor, Sturm, Ruger & Co., Inc., filed a complaint and motion for preliminary injunction against us in the United States District Court, District of New Hampshire, seeking injunctive relief and damages. Plaintiff alleges trade dress infringement, involving our Thompson/Center brand T/CR22 rifle, as well as violation of the New Hampshire Consumer Protection Act. Subsequent to July 31, 2019, in August 2019, Primus Group, LLC filed an action in the United States District Court for the Southern District of Ohio Eastern Division against Smith & Wesson Corp. and other firearms manufacturers, alleging Racketeer Influenced Corrupt Organizations Act (RICO) violations, racketeering enterprise, and intentional misrepresentation. Plaintiff, who operates as an “entertainment venue” in Columbus, Ohio, purports to bring this action on behalf of “[a]ll persons entitled to freely attend schools, shopping locations, churches, entertainment venues, and workplaces in the United States without the intrusion of individuals armed with assault weapons.” In addition to compensatory and punitive damages, plaintiff seeks preliminary and permanent injunctive relief enjoining the distribution and sale of “assault weapons.” On August 20, 2019, the court denied without prejudice plaintiff’s Motion for Temporary Restraining Order. Defendants’ dispositive motions are due on September 3, 2019. The court will hold a hearing on plaintiff’s Preliminary Injunction on October 15, 2019. 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 addition, from time to time, we are involved in lawsuits, claims, investigations, and proceedings, including commercial, environmental, 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 $18.6 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, as described below, are a reasonable quantitative measure of the cost to us of product liability cases and claims. 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. 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. At this time, an estimated range of reasonably possible additional losses relating to unfavorable outcomes cannot be made. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Jul. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment Reporting | (11) Segment Reporting: We report our results of operations in two segments: (1) Firearms (which includes Firearms and Manufacturing Services divisions) and (2) Outdoor Products & Accessories & Accessories segment is evaluated b The Firearms segment includes our firearms, services, and other components, which we manufacture or provide at our facilities in Springfield, Massachusetts; Houlton, Maine; and Deep River, Connecticut, and our firearm products, which we develop, assemble, and market in our Springfield, Massachusetts facility. The Outdoor Products & Accessories Segment assets are those directly used in or clearly allocable to a reportable segment’s operations. Assets by business segment are presented in the following table as of July 31, 2019 and April 30, 2019 (in thousands As of July 31, 2019 As of April 30, 2019 Firearms Outdoor Products Accessories Total Firearms Outdoor Products & Accessories Total Total assets $ 422,536 $ 349,919 $ 772,455 $ 389,719 $ 377,070 $ 766,789 Property, plant, and equipment, net 162,530 11,825 174,355 170,549 12,719 183,268 Intangibles, net 4,583 82,530 87,113 4,661 87,179 91,840 Goodwill 19,024 163,243 182,267 19,024 163,245 182,269 Results by business segment are presented in the following tables for the three months ended July 31, 2019 and 2018 (in thousands): For the Three Months Ended July 31, 2019 (a) Firearms Outdoor Products & Accessories Corporate Intersegment Eliminations Total Revenue from external customers $ 94,555 $ 29,110 $ — $ — $ 123,665 Intersegment revenue 882 4,106 — (4,988 ) — Total net sales 95,437 33,216 — (4,988 ) 123,665 Cost of sales 60,039 19,143 — (3,371 ) 75,811 Gross margin 35,398 14,073 — (1,617 ) 47,854 Operating income/(loss) 8,998 (7,112 ) (11,020 ) 10,277 1,143 Income tax expense/(benefit) 4,420 (752 ) (3,039 ) — 629 For the Three Months Ended July 31, 2018 (a) Firearms Outdoor Products & Accessories Corporate Intersegment Eliminations Total Revenue from external customers $ 104,474 $ 34,359 $ — $ — $ 138,833 Intersegment revenue 784 2,897 — (3,681 ) — Total net sales 105,258 37,256 — (3,681 ) 138,833 Cost of sales 70,465 20,374 — (4,428 ) 86,411 Gross margin 34,793 16,882 — 747 52,422 Operating income/(loss) 14,091 (2,418 ) (10,552 ) 12,355 13,476 Income tax expense/(benefit) 4,124 (426 ) 114 — 3,812 (a) We allocate all of corporate overhead expenses except for interest and income taxes, such as general and administrative expenses and other corporate-level expenses, to both our Firearms and Outdoor Products & Accessories segments. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Jul. 31, 2019 | |
Accounting Policies [Abstract] | |
Interim Financial Information | Interim Financial Information – The condensed consolidated balance sheet as of July 31, 2019, the condensed consolidated statements of (loss)/income and comprehensive (loss)/income for the three months ended July 31, 2019 and 2018, the condensed consolidated statement of changes in stockholders’ equity for the three months ended July 31, 2019, and the condensed consolidated statements of cash flows for the three months ended July 31, 2019 and 2018 have been prepared by us without audit. 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 July 31, 2019 and for the periods presented, have been included. All intercompany transactions have been eliminated in consolidation. The consolidated balance sheet as of April 30, 2019 has been derived from our audited consolidated financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended April 30, 2019. The results of operations for the three months ended |
Revenue Recognition | Revenue Recognition - We recognize revenue in accordance with the provisions of Accounting Standards Update, or ASU, (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 that entitle customers to receive free goods based upon their purchase of our products. The fulfillment of these free goods are 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 proportionally as each performance obligation is satisfied, based on the relative transaction price of each product. The net change in contract liabilities for a given period is reported as an increase or decrease to sales. Our product sales are generally sold free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 90 days of product shipment with a discount available to some customers for early payment. For contracts with discounted terms, we determine the transaction price upon establishment of the contract that contains the final terms of the sale, including the 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. In some instances, we provide longer payment terms, particularly as it relates to our hunting dating programs, which represent payment terms due in the fall for certain orders of hunting products received in the spring and summer. 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. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards – In February 2016, the FASB issued ASU 2016-02, (Topic 842), or ASU 2016-02, which amends the existing guidance to require lessees to recognize right-of-use assets and lease liabilities in a classified balance sheet. The most prominent among the changes in the standard is the requirement for lessees to recognize right-of-use assets and lease liabilities for those leases classified as operating leases under current U.S. GAAP. The requirements of this ASU are effective for financial statements for annual periods beginning after December 15, 2018, and early adoption is permitted. We utilized leasing software to assist us in the accounting and tracking of leases and used the optional transitional method allowed by ASU 2018-11, Leases (Topic 842 Targeted Improvements. Under this method, we applied the standard using the modified retrospective method with an adoption date of May 1, 2019. We elected to use the package of practical expedients, which permits us to not reassess certain lease contract provisions. We adopted ASU 2016-02 effective May 1, 2019 and recognized right-of-use assets of $11.5 million, lease liabilities of $12.8 million. The difference between the right-of-use assets and the lease liabilities of $1.3 million is a result of the reclassification of deferred rent and lease incentive liabilities primarily relating to our real estate operating leases into the right-of use assets, which had no impact to retained earnings. See also Note 3 – , for more information. In June 2016, the FASB issued ASU 2016-13, Financial Instruments — Credit Losses |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
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 July 31, 2019 are as follows (in thousands): Balance Sheet Caption July 31, 2019 Operating Leases Right-of-use assets $ 10,928 Accumulated amortization (643 ) Right-of-use assets, net Other assets $ 10,285 Current liabilities Accrued expenses and deferred revenue $ 2,726 Non-current liabilities Other non-current liabilities 8,778 Total operating lease liabilities $ 11,504 Finance Leases Right-of-use assets $ 41,070 Accumulated depreciation (551 ) Right-of-use assets, net Property, plant, and equipment, net $ 40,519 Current liabilities Accrued expenses and deferred revenue 914 Non-current liabilities Finance lease payable, net of current portion 40,708 Total finance lease liabilities $ 41,622 |
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 2020 $ 2,503 $ 2,230 $ 4,733 2021 2,874 3,016 5,890 2022 2,712 3,056 5,768 2023 2,582 3,071 5,653 2024 1,537 3,125 4,662 2025 268 3,180 3,438 Thereafter 680 48,853 49,543 Total future lease payments 13,156 66,531 79,687 Less amounts representing interest (1,652 ) (24,909 ) (26,561 ) Present value of lease payments 11,504 41,622 53,126 Less current maturities of lease liabilities (2,726 ) (914 ) (3,640 ) Long-term maturities of lease liabilities $ 8,778 $ 40,708 $ 49,486 |
Revenue Recognition and Contr_2
Revenue Recognition and Contracts with Customers (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
Revenue From Contract With Customer [Abstract] | |
Schedule of Impact of Adoption of ASU 2014-09 on Revenue Recognized | The following table outlines the impact of the adoption of ASU 2014-09 on revenue recognized during the three-month periods ended July 31, 2019 and 2018 (in thousands): July 31, 2019 July 31, 2018 Outstanding performance obligations at beginning of period $ 12,213 $ 23,305 Revenue recognized (14,571 ) (13,998 ) Revenue deferred 5,472 4,314 Outstanding performance obligations at end of period $ 3,114 $ 13,621 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill for the three months ended July 31, 2019 by reporting segment were as follows: Outdoor Products & Firearms Segment Accessories Segment Total Goodwill Balance as of April 30, 2019 $ 19,024 $ 163,245 $ 182,269 Adjustments — (2 ) (2 ) Balance as of July 31, 2019 $ 19,024 $ 163,243 $ 182,267 |
Summary of Intangible Assets | The following table presents a summary of intangible assets as of July 31, 2019 and April 30, 2019 (in thousands): July 31, 2019 April 30, 2019 Gross Gross Carrying Accumulated Net Carrying Carrying Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Customer relationships $ 92,560 $ (44,478 ) $ 48,082 $ 92,560 $ (41,643 ) $ 50,917 Developed technology 21,230 (10,947 ) 10,283 21,230 (10,428 ) 10,802 Patents, trademarks, and trade names 57,659 (29,974 ) 27,685 57,477 (28,479 ) 28,998 Backlog 1,150 (1,150 ) — 1,150 (1,150 ) — 172,599 (86,549 ) 86,050 172,417 (81,700 ) 90,717 Patents in progress 837 — 837 897 — 897 Total definite-lived intangible assets 173,436 (86,549 ) 86,887 173,314 (81,700 ) 91,614 Indefinite-lived intangible assets 226 — 226 226 — 226 Total intangible assets $ 173,662 $ (86,549 ) $ 87,113 $ 173,540 $ (81,700 ) $ 91,840 |
Schedule of Future Expected Amortization Expense | Estimated amortization expense of intangible assets for the remainder of fiscal 2020 and succeeding fiscal years is as follows (in thousands): Fiscal Amount 2020 $ 14,415 2021 16,604 2022 14,218 2023 11,849 2024 10,102 Thereafter 18,862 Total $ 86,050 |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
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 July 31, 2019 and April 30, 2018 (in thousands): July 31, 2019 April 30, 2019 Finished goods $ 134,874 $ 108,247 Finished parts 41,727 36,181 Work in process 5,569 7,576 Raw material 13,278 11,766 Total inventories $ 195,448 $ 163,770 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
Equity [Abstract] | |
Reconciliation of Net (Loss)/Income Amounts and Weighted Average Number of Common and Common Equivalent Shares Used to Determine Basic and Diluted Earnings per Share | The following table provides a reconciliation of the net (loss)/income amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings per share for the three months ended July 31, 2019 and 2018 (in thousands, except per share data): For the Three Months Ended July 31, 2019 2018 Net Per Share Net Per Share Loss Shares Amount Income Shares Amount Basic earnings $ (2,108 ) 54,783 $ (0.04 ) $ 7,645 54,345 $ 0.14 Effect of dilutive stock awards — — — — 586 — Diluted earnings $ (2,108 ) 54,783 $ (0.04 ) $ 7,645 54,931 $ 0.14 |
Share Based Compensation Stock Options Activity | The number of shares and weighted average exercise prices of stock options for the three months ended July 31, 2019 and 2018 were as follows: For the Three Months Ended July 31, 2019 2018 Weighted Weighted Average Average Shares Exercise Price Shares Exercise Price Options outstanding, beginning of year 267,761 $ 6.76 316,160 $ 6.69 Exercised during the period — — (17,399 ) 7.98 Options outstanding, end of period 267,761 $ 6.76 298,761 $ 6.61 Weighted average remaining contractual life 2.10 years 2.86 years Options exercisable, end of period 267,761 $ 6.76 298,761 $ 6.61 Weighted average remaining contractual life 2.10 years 2.86 years |
Summary of Activity for Unvested RSUs and PSUs | A summary of activity for unvested RSUs and PSUs for the three months ended July 31, 2019 and 2018 is as follows: For the Three Months Ended July 31, 2019 2018 Weighted Weighted Total # of Average Total # of Average Restricted Grant Date Restricted Grant Date Stock Units Fair Value Stock Units Fair Value RSUs and PSUs outstanding, beginning of period 1,631,631 $ 17.80 1,442,316 $ 17.80 Awarded 131,771 10.65 140,771 12.35 Vested (182,900 ) 19.11 (146,523 ) 18.78 Forfeited (138,830 ) 16.11 (118,180 ) 15.53 RSUs and PSUs outstanding, end of period 1,441,672 $ 15.44 1,318,384 $ 17.31 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Jul. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Assets by Business Segment | Assets by business segment are presented in the following table as of July 31, 2019 and April 30, 2019 (in thousands As of July 31, 2019 As of April 30, 2019 Firearms Outdoor Products Accessories Total Firearms Outdoor Products & Accessories Total Total assets $ 422,536 $ 349,919 $ 772,455 $ 389,719 $ 377,070 $ 766,789 Property, plant, and equipment, net 162,530 11,825 174,355 170,549 12,719 183,268 Intangibles, net 4,583 82,530 87,113 4,661 87,179 91,840 Goodwill 19,024 163,243 182,267 19,024 163,245 182,269 |
Schedule of Results by Business Segment | Results by business segment are presented in the following tables for the three months ended July 31, 2019 and 2018 (in thousands): For the Three Months Ended July 31, 2019 (a) Firearms Outdoor Products & Accessories Corporate Intersegment Eliminations Total Revenue from external customers $ 94,555 $ 29,110 $ — $ — $ 123,665 Intersegment revenue 882 4,106 — (4,988 ) — Total net sales 95,437 33,216 — (4,988 ) 123,665 Cost of sales 60,039 19,143 — (3,371 ) 75,811 Gross margin 35,398 14,073 — (1,617 ) 47,854 Operating income/(loss) 8,998 (7,112 ) (11,020 ) 10,277 1,143 Income tax expense/(benefit) 4,420 (752 ) (3,039 ) — 629 For the Three Months Ended July 31, 2018 (a) Firearms Outdoor Products & Accessories Corporate Intersegment Eliminations Total Revenue from external customers $ 104,474 $ 34,359 $ — $ — $ 138,833 Intersegment revenue 784 2,897 — (3,681 ) — Total net sales 105,258 37,256 — (3,681 ) 138,833 Cost of sales 70,465 20,374 — (4,428 ) 86,411 Gross margin 34,793 16,882 — 747 52,422 Operating income/(loss) 14,091 (2,418 ) (10,552 ) 12,355 13,476 Income tax expense/(benefit) 4,124 (426 ) 114 — 3,812 (a) We allocate all of corporate overhead expenses except for interest and income taxes, such as general and administrative expenses and other corporate-level expenses, to both our Firearms and Outdoor Products & Accessories segments. |
Basis of Presentation - Additio
Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 31, 2019 | May 01, 2019 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Right-of-use assets recognition | $ 10,285 | |
Lease liabilities recognition | $ 11,504 | |
ASU 2014-09 | ||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Description of payment terms | Our product sales are generally sold free on board, or FOB, shipping point and provide payment terms to most commercial customers ranging from 20 to 90 days of product shipment with a discount available to some customers for early payment. For contracts with discounted terms, we determine the transaction price upon establishment of the contract that contains the final terms of the sale, including the 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. In some instances, we provide longer payment terms, particularly as it relates to our hunting dating programs, which represent payment terms due in the fall for certain orders of hunting products received in the spring and summer. 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. | |
ASU 2016-02 | ||
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | ||
Right-of-use assets recognition | $ 11,500 | |
Lease liabilities recognition | 12,800 | |
Reclassification of deferred rent and lease incentive liabilities related to real estate operating leases | $ 1,300 |
Leases - Schedule of Assets and
Leases - Schedule of Assets and Liabilities Related to Operating and Financing Leases (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Operating Leases | ||
Right-of-use assets | $ 10,928 | |
Accumulated amortization | (643) | |
Right-of-use assets, net | $ 10,285 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssetsNoncurrent | |
Current liabilities | $ 2,726 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | aobc:AccruedExpensesAndDeferredRevenueCurrent | |
Non-current liabilities | $ 8,778 | |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilitiesNoncurrent | |
Total operating lease liabilities | $ 11,504 | |
Finance Leases | ||
Right-of-use assets | 41,070 | |
Accumulated depreciation | (551) | |
Right-of-use assets, net | $ 40,519 | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:PropertyPlantAndEquipmentNet | |
Current liabilities | $ 914 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | aobc:AccruedExpensesAndDeferredRevenueCurrent | |
Non-current liabilities | $ 40,708 | $ 45,400 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:FinanceLeaseLiabilityNoncurrent | |
Total finance lease liabilities | $ 41,622 |
Leases - Additional Information
Leases - Additional Information (Detail) | 3 Months Ended |
Jul. 31, 2019USD ($) | |
Leases [Abstract] | |
Operating lease cost | $ 1,000,000 |
short-term operating lease costs | 200,000 |
Financing lease Amortization | 535,000 |
Financing lease interest expense | $ 520,000 |
Operating leases, weighted average lease term | 4 years 9 months 18 days |
Operating leases, weighted average discount rate | 4.60% |
Financing leases, weighted average lease term | 19 years |
Financing leases, weighted average discount rate | 5.00% |
Cash paid for amounts included in measurement of liabilities and operating cash flows | $ 1,400,000 |
Leases - Summary of Future Leas
Leases - Summary of Future Lease Payments for Operating and Finance Leases (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Operating and Finance Lease liabilies payments | ||
2020 | $ 4,733 | |
2021 | 5,890 | |
2022 | 5,768 | |
2023 | 5,653 | |
2024 | 4,662 | |
2025 | 3,438 | |
Thereafter | 49,543 | |
Total future lease payments | 79,687 | |
Less amounts representing interest | (26,561) | |
Present value of lease payments | 53,126 | |
Less current maturities of lease liabilities | (3,640) | |
Long-term maturities of lease liabilities | 49,486 | |
Operating Leases | ||
2020 | 2,503 | |
2021 | 2,874 | |
2022 | 2,712 | |
2023 | 2,582 | |
2024 | 1,537 | |
2025 | 268 | |
Thereafter | 680 | |
Total future lease payments | 13,156 | |
Less amounts representing interest | (1,652) | |
Total operating lease liabilities | 11,504 | |
Less current maturities of lease liabilities | (2,726) | |
Long-term maturities of lease liabilities | 8,778 | |
Financing Leases | ||
2020 | 2,230 | |
2021 | 3,016 | |
2022 | 3,056 | |
2023 | 3,071 | |
2024 | 3,125 | |
2025 | 3,180 | |
Thereafter | 48,853 | |
Total future lease payments | 66,531 | |
Less amounts representing interest | (24,909) | |
Total finance lease liabilities | 41,622 | |
Less current maturities of lease liabilities | (914) | |
Long-term maturities of lease liabilities | $ 40,708 | $ 45,400 |
Revenue Recognition and Contr_3
Revenue Recognition and Contracts with Customers - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Disaggregation Of Revenue [Line Items] | ||
Deferred revenue recognized | $ 14,600 | $ 14,000 |
Additional deferred revenue for outstanding performance obligations | 5,500 | 4,300 |
Outstanding performance obligation liability | 13,600 | |
Net increase of revenue | 9,100 | 9,700 |
ASU 2014-09 | ||
Disaggregation Of Revenue [Line Items] | ||
Deferred revenue recognized | 14,571 | 13,998 |
Additional deferred revenue for outstanding performance obligations | $ 5,472 | $ 4,314 |
Total Net Sales | ASU 2014-09 | Geographic Concentration Risk | Domestic | ||
Disaggregation Of Revenue [Line Items] | ||
Concentration risk percentage | 95.00% |
Revenue Recognition and Contr_4
Revenue Recognition and Contracts with Customers - Schedule of Impact of Adoption of ASU 2014-09 on Revenue Recognized (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Disaggregation Of Revenue [Line Items] | ||
Revenue recognized | $ (14,600) | $ (14,000) |
Revenue deferred | 5,500 | 4,300 |
ASU 2014-09 | ||
Disaggregation Of Revenue [Line Items] | ||
Outstanding performance obligations with customers, beginning balance | 12,213 | 23,305 |
Revenue recognized | (14,571) | (13,998) |
Revenue deferred | 5,472 | 4,314 |
Outstanding performance obligations with customers, ending balance | $ 3,114 | $ 13,621 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Changes in Carrying Amount of Goodwill (Detail) $ in Thousands | 3 Months Ended |
Jul. 31, 2019USD ($) | |
Goodwill [Line Items] | |
Beginning Balance | $ 182,269 |
Adjustments | (2) |
Ending Balance | 182,267 |
Firearms Segment | |
Goodwill [Line Items] | |
Beginning Balance | 19,024 |
Ending Balance | 19,024 |
Outdoor Products & Accessories Segment | |
Goodwill [Line Items] | |
Beginning Balance | 163,245 |
Adjustments | (2) |
Ending Balance | $ 163,243 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | $ 173,436 | $ 173,314 |
Total definite-lived intangible assets, Accumulated Amortization | (86,549) | (81,700) |
Total definite-lived intangible assets, Net Carrying Amount | 86,887 | 91,614 |
Indefinite-lived intangible assets, Net Carrying Amount | 226 | 226 |
Total Intangible assets, Gross Carrying Amount | 173,662 | 173,540 |
Total Intangible assets, Net Carrying Amount | 87,113 | 91,840 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 92,560 | 92,560 |
Total definite-lived intangible assets, Accumulated Amortization | (44,478) | (41,643) |
Total definite-lived intangible assets, Net Carrying Amount | 48,082 | 50,917 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 21,230 | 21,230 |
Total definite-lived intangible assets, Accumulated Amortization | (10,947) | (10,428) |
Total definite-lived intangible assets, Net Carrying Amount | 10,283 | 10,802 |
Patents, trademarks, and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 57,659 | 57,477 |
Total definite-lived intangible assets, Accumulated Amortization | (29,974) | (28,479) |
Total definite-lived intangible assets, Net Carrying Amount | 27,685 | 28,998 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 1,150 | 1,150 |
Total definite-lived intangible assets, Accumulated Amortization | (1,150) | (1,150) |
Definite-lived intangible assets excluding patents in progress | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 172,599 | 172,417 |
Total definite-lived intangible assets, Accumulated Amortization | (86,549) | (81,700) |
Total definite-lived intangible assets, Net Carrying Amount | 86,050 | 90,717 |
Patents in progress | ||
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Gross Carrying Amount | 837 | 897 |
Total definite-lived intangible assets, Net Carrying Amount | $ 837 | $ 897 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization expense of intangible assets | $ 4.8 | $ 5.4 |
Weighted-average period for amortization of intangible assets | 5 years | |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-average period for amortization of intangible assets | 5 years | |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-average period for amortization of intangible assets | 6 years | |
Patents, trademarks, and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-average period for amortization of intangible assets | 5 years |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Future Expected Amortization Expense (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Total definite-lived intangible assets, Net Carrying Amount | $ 86,887 | $ 91,614 |
Outdoor Products & Accessories Segment | ||
Finite-Lived Intangible Assets [Line Items] | ||
2020 | 14,415 | |
2021 | 16,604 | |
2022 | 14,218 | |
2023 | 11,849 | |
2024 | 10,102 | |
Thereafter | 18,862 | |
Total definite-lived intangible assets, Net Carrying Amount | $ 86,050 |
Notes, Loans Payable, and Fin_2
Notes, Loans Payable, and Financing Arrangements - Additional Information (Detail) - USD ($) | 3 Months Ended | |||||
Jul. 31, 2019 | Feb. 28, 2018 | Oct. 27, 2016 | Jul. 06, 2015 | Jun. 18, 2015 | Jun. 15, 2015 | |
Debt Instrument [Line Items] | ||||||
Interest description of revolving line of credit | The Revolving Line provides for availability for general corporate purposes, with borrowings to bear interest at a variable rate equal to LIBOR or prime plus an applicable margin based on our consolidated leverage ratio, at our election. | |||||
Credit facility, maturity | Jun. 15, 2020 | |||||
Percentage of interest rate protection on term loan | 75.00% | |||||
Fair value of the interest rate swap asset | $ 300,000 | |||||
Interest Rate Swap | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of floating rate debt covered | 100.00% | |||||
Derivative, notional amount | $ 105,000,000 | |||||
Derivative, maturity date | Jun. 15, 2020 | |||||
Derivative, fixed interest rate | 1.56% | |||||
Unsecured Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, borrowing capacity | $ 175,000,000 | |||||
Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Borrowings outstanding | $ 25,000,000 | |||||
Outstanding letters of credit | $ 1,000,000 | |||||
Credit Facilities | LIBOR Rate | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate on borrowings | 4.31% | |||||
Term Loan | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding debt | $ 79,800,000 | $ 105,000,000 | ||||
Principal payments per annum | $ 6,300,000 | |||||
Debt instrument, interest rate, effective percentage | 4.38% | |||||
5.000% Senior Notes due 2020 | ||||||
Debt Instrument [Line Items] | ||||||
Notes issued | $ 75,000,000 | |||||
Debt issuance cost | $ 158,000 | |||||
Debt instrument, interest rate | 5.00% | |||||
Description of redemption for senior notes | As of February 28, 2019, we may, at our option, upon not less than 30 nor more than 60 days’ prior notice, redeem all or a portion of the 2020 Senior Notes at a redemption price of 100.000% of the principal amount of the 2020 Senior Notes to be redeemed plus accrued and unpaid interest as of the applicable redemption date. | |||||
Redemption price of senior notes | 100.00% | |||||
Debt instrument maturity date | Aug. 28, 2020 | |||||
Senior notes indenture, maximum number of shares allowed for repurchase as a percentage of consolidated net income for previous four consecutive published fiscal quarters | 75.00% | |||||
Maximum consolidated coverage ratio | 300.00% | |||||
5.000% Senior Notes due 2020 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Senior notes indenture, number of shares allowed for repurchase | $ 50,000,000 | |||||
5.000% Senior Notes due 2020 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Senior notes indenture, number of shares allowed for repurchase | $ 75,000,000 | |||||
Second Amendment | Unsecured Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit facility, borrowing capacity | $ 350,000,000 | |||||
Credit facility additional borrowing capacity option to increase maximum borrowing capacity | $ 150,000,000 | |||||
Credit facility, maturity | Oct. 27, 2021 |
Fair Value Measurement - Additi
Fair Value Measurement - Additional Information (Detail) - USD ($) | 1 Months Ended | ||
Aug. 31, 2017 | Jul. 31, 2019 | Apr. 30, 2019 | |
Gemini Technologies, Incorporated | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Contingent consideration maximum payout | $ 17,100,000 | ||
Business combination, contingent consideration payable performance period | 3 years | ||
Business combination contingent consideration liability non-current | $ 100,000 | ||
(Level 1) | Fair Value on Recurring Basis | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Cash and cash equivalents | $ 30,700,000 | $ 41,000,000 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 134,874 | $ 108,247 |
Finished parts | 41,727 | 36,181 |
Work in process | 5,569 | 7,576 |
Raw material | 13,278 | 11,766 |
Total inventories | $ 195,448 | $ 163,770 |
Stockholders' Equity - Reconcil
Stockholders' Equity - Reconciliation of Net Income Amounts and Weighted Average Number of Common and Common Equivalent Shares Used to Determine Basic and Diluted Earnings per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Earnings Per Share [Abstract] | ||
Net (loss)/income | $ (2,108) | $ 7,645 |
Basic earnings, Shares | 54,783 | 54,345 |
Effect of dilutive stock awards, Shares | 586 | |
Diluted earnings, Shares | 54,783 | 54,931 |
Basic earnings, Per Share Amount | $ (0.04) | $ 0.14 |
Diluted earnings, Per Share Amount | $ (0.04) | $ 0.14 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2019USD ($)OptionPlanshares | Jul. 31, 2018USD ($)shares | Jul. 31, 2019USD ($) | Jul. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of incentive stock plans | OptionPlan | 2 | |||
Intrinsic value of stock outstanding | $ 770,000 | $ 853,000 | $ 770,000 | $ 853,000 |
Intrinsic value of stock exercisable | $ 770,000 | $ 853,000 | 770,000 | 853,000 |
Stock options exercised | shares | 0 | 17,399 | ||
Intrinsic value of stock exercised | $ 76,000 | |||
Unrecognized compensation expense relating to outstanding stock options | $ 0 | 0 | ||
Stock-based compensation expense | 1,600,000 | $ 2,000,000 | ||
Performance period | 3 years | |||
RSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years | |||
Vesting, percentage | 0.25% | |||
Grant date fair value of vested RSUs and PSUs | $ 1,700,000 | $ 1,700,000 | ||
Stock units, forfeited | shares | 15,805 | 6,180 | ||
RSUs | Non-Executive Employees | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock units, awarded | shares | 131,771 | 140,771 | ||
PSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock units, forfeited | shares | 123,025 | 112,000 | ||
RSUs and PSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation expense | $ 1,400,000 | $ 1,800,000 | ||
Stock units, awarded | shares | 131,771 | 140,771 | ||
Stock units, forfeited | shares | 138,830 | 118,180 | ||
Unrecognized compensation expense related to unvested RSUs and PSUs | $ 7,300,000 | $ 7,300,000 | ||
Weighted average remaining contractual term | 1 year 9 months 18 days | |||
2013 Incentive Stock Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock option, exercisable period | 10 years | |||
2013 Incentive Stock Plan | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
2013 Incentive Stock Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years |
Stockholders' Equity - Share Ba
Stockholders' Equity - Share Based Compensation Stock Options Activity (Detail) - $ / shares | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Shares | ||
Options outstanding, beginning of year, Shares | 267,761 | 316,160 |
Exercised during the period, Shares | 0 | (17,399) |
Options outstanding, end of period, Shares | 267,761 | 298,761 |
Weighted average remaining contractual life | 2 years 1 month 6 days | 2 years 10 months 9 days |
Options exercisable, end of period, Shares | 267,761 | 298,761 |
Weighted average remaining contractual life | 2 years 1 month 6 days | 2 years 10 months 9 days |
Weighted-Average Exercise Price | ||
Options outstanding, beginning of year, Weighted-Average Exercise Price | $ 6.76 | $ 6.69 |
Exercised during period, Weighted-Average Exercise Price | 7.98 | |
Options outstanding, end of period, Weighted-Average Exercise Price | 6.76 | 6.61 |
Options exercisable, end of period, Weighted-Average Exercise Price | $ 6.76 | $ 6.61 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Activity for Unvested RSUs and PSUs (Detail) - RSUs and PSUs - $ / shares | 3 Months Ended | |
Jul. 31, 2019 | Jul. 31, 2018 | |
Summary of activity in unvested restricted stock units and performance share units | ||
Restricted Stock Units, RSUs and PSUs outstanding, beginning of period | 1,631,631 | 1,442,316 |
Restricted Stock Units, Awarded | 131,771 | 140,771 |
Restricted Stock Units, Vested | (182,900) | (146,523) |
Restricted Stock Units, Forfeited | (138,830) | (118,180) |
Restricted Stock Units, RSUs and PSUs outstanding, end of period | 1,441,672 | 1,318,384 |
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 | $ 17.80 | $ 17.80 |
Weighted Average Grant Date Fair Value, Awarded | 10.65 | 12.35 |
Weighted Average Grant Date Fair Value, Vested | 19.11 | 18.78 |
Weighted Average Grant Date Fair Value, Forfeited | 16.11 | 15.53 |
Weighted Average Grant Date Fair Value, RSUs and PSUs outstanding, end of period | $ 15.44 | $ 17.31 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 1 Months Ended | 3 Months Ended |
Jan. 31, 2018USD ($) | Jul. 31, 2019USD ($)CaseClaim | |
Schedule Of Commitments And Contingencies [Line Items] | ||
Number of Product liability cases | Case | 8 | |
Number of Other product liability claims | Claim | 6 | |
Minimum | ||
Schedule Of Commitments And Contingencies [Line Items] | ||
Compensatory damages sought | $ 75,000 | |
Maximum | ||
Schedule Of Commitments And Contingencies [Line Items] | ||
Compensatory damages sought | $ 18,600,000 | |
Gemini Technologies, Incorporated | Smith & Wesson Corp | ||
Schedule Of Commitments And Contingencies [Line Items] | ||
Compensatory damages sought | $ 18,600,000 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Detail) | 3 Months Ended |
Jul. 31, 2019Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 2 |
Firearms Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 1 |
Outdoor Products & Accessories Segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segments | 1 |
Segment Reporting - Schedule of
Segment Reporting - Schedule of Assets by Business Segment (Detail) - USD ($) $ in Thousands | Jul. 31, 2019 | Apr. 30, 2019 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 772,455 | $ 766,789 |
Property, plant, and equipment, net | 174,355 | 183,268 |
Intangibles, net | 87,113 | 91,840 |
Goodwill | 182,267 | 182,269 |
Firearms Segment | ||
Segment Reporting Information [Line Items] | ||
Total assets | 422,536 | 389,719 |
Property, plant, and equipment, net | 162,530 | 170,549 |
Intangibles, net | 4,583 | 4,661 |
Goodwill | 19,024 | 19,024 |
Outdoor Products & Accessories Segment | ||
Segment Reporting Information [Line Items] | ||
Total assets | 349,919 | 377,070 |
Property, plant, and equipment, net | 11,825 | 12,719 |
Intangibles, net | 82,530 | 87,179 |
Goodwill | $ 163,243 | $ 163,245 |
Segment Reporting - Schedule _2
Segment Reporting - Schedule of Results by Business Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Jul. 31, 2019 | Jul. 31, 2018 | ||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | $ 123,665 | $ 138,833 |
Cost of sales | [1] | 75,811 | 86,411 |
Gross margin | [1] | 47,854 | 52,422 |
Operating income/(loss) | [1] | 1,143 | 13,476 |
Income tax expense/(benefit) | [1] | 629 | 3,812 |
Firearms Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 94,555 | 104,474 |
Outdoor Products & Accessories Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 29,110 | 34,359 |
Intersegment Eliminations | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | (4,988) | (3,681) |
Cost of sales | [1] | (3,371) | (4,428) |
Gross margin | [1] | (1,617) | 747 |
Operating income/(loss) | [1] | 10,277 | 12,355 |
Intersegment Eliminations | Firearms Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 882 | 784 |
Intersegment Eliminations | Outdoor Products & Accessories Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 4,106 | 2,897 |
Operating Segments | Firearms Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 95,437 | 105,258 |
Cost of sales | [1] | 60,039 | 70,465 |
Gross margin | [1] | 35,398 | 34,793 |
Operating income/(loss) | [1] | 8,998 | 14,091 |
Income tax expense/(benefit) | [1] | 4,420 | 4,124 |
Operating Segments | Outdoor Products & Accessories Segment | |||
Segment Reporting Information [Line Items] | |||
Total net sales | [1] | 33,216 | 37,256 |
Cost of sales | [1] | 19,143 | 20,374 |
Gross margin | [1] | 14,073 | 16,882 |
Operating income/(loss) | [1] | (7,112) | (2,418) |
Income tax expense/(benefit) | [1] | (752) | (426) |
Corporate | |||
Segment Reporting Information [Line Items] | |||
Operating income/(loss) | [1] | (11,020) | (10,552) |
Income tax expense/(benefit) | [1] | $ (3,039) | $ 114 |
[1] | We allocate all of corporate overhead expenses except for interest and income taxes, such as general and administrative expenses and other corporate-level expenses, to both our Firearms and Outdoor Products & Accessories segments. |