Cover Page
Cover Page - shares | 9 Months Ended | |
Dec. 24, 2023 | Jan. 29, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Dec. 24, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-36597 | |
Entity Registrant Name | Vista Outdoor Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 47-1016855 | |
Entity Address, Address Line One | 1 Vista Way | |
Entity Address, City or Town | Anoka | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55303 | |
City Area Code | 763 | |
Local Phone Number | 433-1000 | |
Title of 12(b) Security | Common Stock, par value $.01 | |
Trading Symbol | VSTO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 58,146,933 | |
Entity Central Index Key | 0001616318 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --03-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 57,028 | $ 86,208 |
Net receivables | 374,010 | 339,373 |
Net inventories | 654,839 | 709,897 |
Income tax receivable | 13,692 | 0 |
Other current assets | 36,630 | 60,636 |
Total current assets | 1,136,199 | 1,196,114 |
Net property, plant, and equipment | 208,277 | 228,247 |
Operating lease assets | 95,906 | 106,828 |
Goodwill | 303,995 | 465,709 |
Net intangible assets | 638,298 | 733,176 |
Deferred income tax assets | 4,973 | 0 |
Deferred charges and other non-current assets, net | 65,953 | 68,808 |
Total assets | 2,453,601 | 2,798,882 |
Current liabilities: | ||
Current portion of long-term debt | 65,000 | 65,000 |
Accounts payable | 126,507 | 136,556 |
Accrued compensation | 46,438 | 60,719 |
Accrued income taxes | 0 | 6,676 |
Federal excise, use, and other taxes | 35,323 | 38,543 |
Other current liabilities | 166,764 | 146,377 |
Total current liabilities | 440,032 | 453,871 |
Long-term debt | 763,986 | 984,658 |
Deferred income tax liabilities | 0 | 40,749 |
Long-term operating lease liabilities | 95,429 | 103,313 |
Accrued pension and postemployment benefits | 23,990 | 25,114 |
Other long-term liabilities | 47,259 | 59,384 |
Total liabilities | 1,370,696 | 1,667,089 |
Commitments and contingencies (Note 12 and 15) | ||
Issued and outstanding — 58,122,198 shares as of December 24, 2023 and 57,085,756 shares as of March 31, 2023 | 580 | 570 |
Additional paid-in capital | 1,655,539 | 1,711,155 |
Accumulated deficit | (276,201) | (230,528) |
Accumulated other comprehensive loss | (75,331) | (80,802) |
Common stock in treasury, at cost — 5,842,241 shares held as of December 24, 2023 and 6,878,683 shares held as of March 31, 2023 | (221,682) | (268,602) |
Total stockholders' equity | 1,082,905 | 1,131,793 |
Total liabilities and stockholders' equity | $ 2,453,601 | $ 2,798,882 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 24, 2023 | Mar. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, issued (in shares) | 58,122,198 | 57,085,756 |
Common stock, outstanding (in shares) | 58,122,198 | 57,085,756 |
Common stock in treasury (in shares) | 5,842,241 | 6,878,683 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Income Statement [Abstract] | ||||
Sales, net | $ 682,253 | $ 754,775 | $ 2,052,394 | $ 2,339,065 |
Cost of sales | 479,402 | 515,969 | 1,413,916 | 1,543,915 |
Gross profit | 202,851 | 238,806 | 638,478 | 795,150 |
Operating expenses: | ||||
Research and development | 12,267 | 12,382 | 36,550 | 31,433 |
Selling, general, and administrative | 151,821 | 129,738 | 395,194 | 363,439 |
Impairment of goodwill and intangibles (Note 11) | 218,812 | 0 | 218,812 | 0 |
Operating income (loss) | (180,049) | 96,686 | (12,078) | 400,278 |
Other income, net | 86 | 639 | (1,629) | 1,380 |
Interest expense, net | (15,227) | (18,953) | (48,088) | (39,197) |
Income (loss) before income taxes | (195,190) | 78,372 | (61,795) | 362,461 |
Income tax benefit (provision) | 46,995 | (13,225) | 16,122 | (77,844) |
Net income (loss) | $ (148,195) | $ 65,147 | $ (45,673) | $ 284,617 |
Earnings (loss) per common share: | ||||
Basic (in dollars per share) | $ (2.55) | $ 1.15 | $ (0.79) | $ 5.03 |
Diluted (in dollars per share) | $ (2.55) | $ 1.13 | $ (0.79) | $ 4.91 |
Weighted-average number of common shares outstanding: | ||||
Basic (in shares) | 58,078 | 56,574 | 57,866 | 56,538 |
Diluted (in shares) | 58,078 | 57,843 | 57,866 | 58,022 |
Net income (loss) | $ (148,195) | $ 65,147 | $ (45,673) | $ 284,617 |
Pension and other postretirement benefit liabilities: | ||||
Reclassification of net actuarial loss for pension and postretirement benefit plans recorded to net income, net of tax (expense) of $(176) and $(528) for the three and nine months ended December 24, 2023, respectively, and $(221) and $(663) for the three and nine months ended December 25, 2022, respectively | 562 | 694 | 1,686 | 2,082 |
Change in derivatives, net of tax (expense) benefit of $254 and $(896) for the three and nine months ended December 24, 2023, respectively, and $164 and $945 for the three and nine months ended December 25, 2022, respectively | (812) | (515) | 2,860 | (793) |
Change in cumulative translation adjustment, net of tax (expense) of $0 and $0 for the three and nine months ended December 24, 2023, respectively, and $(3) and $(171) for the three and nine months ended December 25, 2022, respectively | 954 | 994 | 925 | (877) |
Total other comprehensive income | 704 | 1,173 | 5,471 | 412 |
Comprehensive income (loss) | $ (147,491) | $ 66,320 | $ (40,202) | $ 285,029 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Income Statement [Abstract] | ||||
Reclassification of net actuarial loss for pension and postretirement benefit plans recorded to net income, tax | $ (176) | $ (221) | $ (528) | $ (663) |
Change in derivatives, tax | 254 | 164 | (896) | 945 |
Change in cumulative translation adjustment, tax | $ 0 | $ (3) | $ 0 | $ (171) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 24, 2023 | Dec. 25, 2022 | |
Operating Activities: | ||
Net income (loss) | $ (45,673) | $ 284,617 |
Adjustments to net income (loss) to arrive at cash provided by operating activities: | ||
Depreciation | 36,981 | 35,660 |
Amortization of intangible assets | 37,826 | 31,431 |
Amortization of deferred financing costs | 6,222 | 4,603 |
Impairment of goodwill and intangibles (Note 11) | 218,812 | 0 |
Impairment of long-lived assets | 2,845 | 0 |
Change in fair value of contingent consideration | 3,146 | (16,403) |
Deferred income taxes | (47,139) | (6,165) |
Gain on foreign exchange | (941) | (586) |
Loss on disposal of property, plant, and equipment | 387 | 699 |
Share-based compensation | 7,917 | 19,590 |
Changes in assets and liabilities: | ||
Net receivables | (33,761) | 31,127 |
Net inventories | 58,634 | (45,568) |
Accounts payable | (8,260) | (11,254) |
Accrued compensation | (14,166) | (39,558) |
Accrued income taxes | (22,683) | 13,538 |
Federal excise, use, and other taxes | (3,214) | (4,643) |
Pension and other postretirement benefits | 1,090 | 1,600 |
Other assets and liabilities | 42,246 | 8,828 |
Cash provided by operating activities | 240,269 | 307,516 |
Investing Activities: | ||
Capital expenditures | (19,418) | (25,157) |
Acquisition of businesses, net of cash received | 0 | (761,497) |
Proceeds from the disposition of property, plant, and equipment | 137 | 43 |
Cash used in investing activities | (19,281) | (786,611) |
Financing Activities: | ||
Proceeds from credit facility | 172,000 | 468,000 |
Repayments of credit facility | (257,000) | (223,000) |
Proceeds from issuance of long-term debt | 0 | 350,000 |
Debt issuance costs | (63) | (16,935) |
Payments on long-term debt | (140,000) | (35,000) |
Payments made for contingent consideration | (8,585) | 0 |
Proceeds from exercise of stock options | 127 | 205 |
Payment of employee taxes related to vested stock awards | (16,840) | (8,946) |
Cash (used in) provided by financing activities | (250,361) | 534,324 |
Effect of foreign exchange rate fluctuations on cash | 193 | (387) |
Increase (decrease) in cash and cash equivalents | (29,180) | 54,842 |
Cash and cash equivalents at beginning of period | 86,208 | 22,584 |
Cash and cash equivalents at end of period | 57,028 | 77,426 |
Supplemental Cash Flow Disclosures: | ||
Capital expenditures included in accounts payable and other current liabilities | 2,683 | 4,020 |
Contingent consideration in connection with business combinations | $ 0 | $ 11,400 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Treasury Stock |
Beginning balance (in shares) at Mar. 31, 2022 | 56,093,456 | |||||
Beginning balance at Mar. 31, 2022 | $ 1,124,399 | $ 560 | $ 1,730,927 | $ (220,810) | $ (76,679) | $ (309,599) |
Increase (Decrease) in Stockholders' Equity | ||||||
Comprehensive income (loss) | 285,029 | 284,617 | 412 | |||
Exercise of stock options (in shares) | 14,407 | |||||
Exercise of stock options | 205 | (360) | 565 | |||
Share-based compensation | 19,590 | 19,590 | ||||
Restricted stock vested and shares withheld (in shares) | 415,294 | |||||
Restricted stock vested and shares withheld | (8,765) | (26,016) | 17,251 | |||
Employee stock purchase plan (in shares) | 12,197 | |||||
Employee stock purchase plan | 302 | (176) | 478 | |||
Other (in shares) | 40,051 | |||||
Other | $ 6 | |||||
Other | (108) | (1,671) | 1,557 | |||
Ending balance (in shares) at Dec. 25, 2022 | 56,575,405 | |||||
Ending balance at Dec. 25, 2022 | 1,420,652 | $ 566 | 1,722,294 | 63,807 | (76,267) | (289,748) |
Beginning balance (in shares) at Sep. 25, 2022 | 56,566,915 | |||||
Beginning balance at Sep. 25, 2022 | 1,349,451 | $ 566 | 1,717,750 | (1,340) | (77,440) | (290,085) |
Increase (Decrease) in Stockholders' Equity | ||||||
Comprehensive income (loss) | 66,320 | 65,147 | 1,173 | |||
Exercise of stock options (in shares) | 1,257 | |||||
Exercise of stock options | 24 | (25) | 49 | |||
Share-based compensation | 4,834 | 4,834 | ||||
Restricted stock vested and shares withheld (in shares) | 929 | |||||
Restricted stock vested and shares withheld | (12) | (52) | 40 | |||
Employee stock purchase plan (in shares) | 6,195 | |||||
Employee stock purchase plan | 143 | (100) | 243 | |||
Other (in shares) | 109 | |||||
Other | $ 0 | |||||
Other | (108) | (113) | 5 | |||
Ending balance (in shares) at Dec. 25, 2022 | 56,575,405 | |||||
Ending balance at Dec. 25, 2022 | $ 1,420,652 | $ 566 | 1,722,294 | 63,807 | (76,267) | (289,748) |
Beginning balance (in shares) at Mar. 31, 2023 | 57,085,756 | 57,085,756 | ||||
Beginning balance at Mar. 31, 2023 | $ 1,131,793 | $ 570 | 1,711,155 | (230,528) | (80,802) | (268,602) |
Increase (Decrease) in Stockholders' Equity | ||||||
Comprehensive income (loss) | (40,202) | (45,673) | 5,471 | |||
Exercise of stock options (in shares) | 8,706 | |||||
Exercise of stock options | 127 | (206) | 333 | |||
Share-based compensation | 7,917 | 7,917 | ||||
Restricted stock vested and shares withheld (in shares) | 961,013 | |||||
Restricted stock vested and shares withheld | (16,980) | (61,029) | 44,049 | |||
Employee stock purchase plan (in shares) | 8,759 | |||||
Employee stock purchase plan | 250 | (83) | 333 | |||
Other (in shares) | 57,964 | |||||
Other | $ 10 | |||||
Other | $ 0 | (2,215) | 2,205 | |||
Ending balance (in shares) at Dec. 24, 2023 | 58,122,198 | 58,122,198 | ||||
Ending balance at Dec. 24, 2023 | $ 1,082,905 | $ 580 | 1,655,539 | (276,201) | (75,331) | (221,682) |
Beginning balance (in shares) at Sep. 24, 2023 | 58,062,364 | |||||
Beginning balance at Sep. 24, 2023 | 1,225,744 | $ 579 | 1,653,407 | (128,006) | (76,035) | (224,201) |
Increase (Decrease) in Stockholders' Equity | ||||||
Comprehensive income (loss) | (147,491) | (148,195) | 704 | |||
Exercise of stock options (in shares) | 6,296 | |||||
Exercise of stock options | 88 | (151) | 239 | |||
Share-based compensation | 5,237 | 5,237 | ||||
Restricted stock vested and shares withheld (in shares) | 49,808 | |||||
Restricted stock vested and shares withheld | (794) | (2,930) | 2,136 | |||
Employee stock purchase plan (in shares) | 3,730 | |||||
Employee stock purchase plan | 118 | (24) | 142 | |||
Other (in shares) | 0 | |||||
Other | $ 1 | |||||
Other | $ 3 | 0 | 2 | |||
Ending balance (in shares) at Dec. 24, 2023 | 58,122,198 | 58,122,198 | ||||
Ending balance at Dec. 24, 2023 | $ 1,082,905 | $ 580 | $ 1,655,539 | $ (276,201) | $ (75,331) | $ (221,682) |
The Company and Basis of Presen
The Company and Basis of Presentation | 9 Months Ended |
Dec. 24, 2023 | |
Accounting Policies [Abstract] | |
The Company and Basis of Presentation | The Company and Basis of Presentation Nature of Operations —Vista Outdoor Inc. (together with our subsidiaries, "Vista Outdoor", "we", "our", and "us", unless the context otherwise requires) is a leading global designer, manufacturer, and marketer of outdoor recreation and shooting sports products. We operate through two reportable segments, The Kinetic Group (formerly Sporting Products) and Revelyst (formerly Outdoor Products), which were renamed during our third fiscal quarter. See Note 16, Operating Segment Information , for further information. We are headquartered in Anoka, Minnesota and have manufacturing and distribution facilities in the United States, Canada, Mexico, and Puerto Rico along with international customer service, sales and sourcing operations in Asia and Europe. We have a robust global distribution network serving customers in over 100 countries. Vista Outdoor was incorporated in Delaware in 2014. Basis of Presentation —Our unaudited condensed consolidated financial statements have been prepared in accordance with the requirements of the Securities and Exchange Commission ("SEC") for interim reporting. As permitted under those rules, certain disclosures and other financial information that normally are required by accounting principles generally accepted in the United States have been condensed or omitted. Management is responsible for the unaudited condensed consolidated financial statements included in this report, which in the opinion of management, include all adjustments necessary for a fair presentation of our financial position, results of operations, and cash flows for the periods and dates presented. These unaudited condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 (“fiscal year 2023”), which was filed with the SEC on May 25, 2023. Change in Presentation —In connection with our preparation of the condensed consolidated financial statements for the three and nine months ended December 24, 2023, we changed the presentation of "Earnings (loss) before interest, income taxes, and other" to "Operating income (loss)" within the condensed consolidated statements of comprehensive income (loss). This correction did not affect previously reported net income (loss) and is immaterial to the previously issued financial statements. Use of Estimates —The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect amounts reported therein. Due to the inherent uncertainty involved in making estimates, actual results reported in future periods may differ from those estimates. We review our estimates to ensure that these estimates properly reflect changes in our business or as new information becomes available. New Accounting Pronouncements —Our accounting policies are described in Note 1 of the audited consolidated financial statements in our Annual Report on Form 10-K for fiscal year 2023, which was filed with the SEC on May 25, 2023. Such significant accounting policies are applicable for periods prior to the following new accounting standards. In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, “ Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures .” This ASU improves financial reporting by requiring disclosure of incremental segment information. The new guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of adopting this ASU 2023-07 on our consolidated financial statements and disclosures. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which improves the transparency of income tax disclosures by requiring companies to (1) disclose consistent categories and greater disaggregation of information in the effective rate reconciliation and (2) provide information on income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, although early adoption is permitted. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively. We are currently evaluating the impact of adopting this ASU 2023-09 on our consolidated financial statements and disclosures. Accounting Standards Adopted During this Fiscal Year —In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, which requires a buyer in a supplier finance program to disclose qualitative and quantitative information about its program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. The amendments in ASU 2022-04 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with the exception for the amendment on roll-forward information, which is effective for fiscal years beginning after December 15, 2023. The guidance should be applied retrospectively, except for the amendment on roll-forward information, which should be applied prospectively. This ASU was effective for us in the first quarter of fiscal year 2024, with the exception of the amendment on roll-forward information, which will be effective for us in our Form 10-K for fiscal year 2025. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our condensed consolidated financial statement disclosures. Goodwill —Our policy is to test goodwill for impairment on the first day of the fourth fiscal quarter or upon the occurrence of events or changes in circumstances that indicate that the asset might be impaired. Goodwill is assigned to our reporting units, which are our operating segments, or components of an operating segment, that constitute a business for which discrete financial information is available, and for which segment management regularly reviews the operating results. During the third quarter of fiscal year 2024, as a result of an increasingly challenging economic environment for consumers due to higher interest rate expectations continuing, and other factors affecting the market for our products, we reduced our projections for fiscal year 2024 and beyond for the majority of our reporting units within the Revelyst reportable segment. As a result of a downward revision of forecasted cash flows due to lower volume and profitability expectations, combined with the decline in our stock price in the third fiscal quarter, we concluded that triggering events had occurred potentially indicating that the fair values of certain reporting units within our Revelyst reportable segment were less than their carrying values. Based on these events, we completed an interim quantitative goodwill impairment analysis and recognized goodwill impairment losses of $161,714 related to reporting units within our Revelyst reportable segment, which are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. See Note 11, Goodwill and Intangible Assets , for further information. For the third quarter fiscal year 2024 interim quantitative goodwill impairment analysis, we determined the estimated fair value of each reporting unit and compared it to their respective carrying amounts, including goodwill. The fair value of each reporting unit was determined considering both an income and market approach. We weighted the valuations of our Revelyst segment reporting units using 100% of the income approach, specifically the discounted cash flow method. The weighted average cost of capital used in the income approach ranged between 12.5% and 16.0%, which was derived from the financial structures of comparable companies corresponding to the industry of each reporting unit. We weighted the value of The Kinetic Group reporting unit using 100% of the market approach, based on the offer accepted in the Sporting Products Sale. This market approach method estimates the price reasonably expected to be realized. See Sale of Sporting Products and Planned Separation in the Executive Summary and Financial Highlights of Part I, Item 2 of this Quarterly Report on Form 10-Q for further discussion of the Sporting Products Sale. In developing the discounted cash flow analysis, our assumptions about forecasted revenues and operating margins, capital expenditures, and changes in working capital were based on forecasts, as reviewed by the Board of Directors, and assume a terminal growth rate thereafter. A separate discount rate was determined for each Revelyst reporting unit and these cash flows were then discounted to determine the fair value of the reporting unit. The discounted cash flow analysis is derived from valuation techniques in which one or more significant inputs are not observable (Level 3 fair value measurements). In order to assess the reasonableness of the calculated fair values of our reporting units, we also compared the sum of the reporting units’ fair values to our market capitalization and calculated an implied control premium (the excess of the sum of the reporting units’ fair values over the market capitalization). We evaluated the control premium by comparing it to control premiums of recent comparable transactions. If the implied control premium was not reasonable in light of this assessment, we would have reevaluated our fair value estimates of the reporting units by adjusting the discount rates and other assumptions as necessary. Indefinite-Lived Intangible Assets —Indefinite lived intangibles are not amortized and are tested for impairment annually on the first day of the fourth fiscal quarter or upon the occurrence of events or changes in circumstances that indicate that the assets might be impaired. In conjunction with our interim quantitative goodwill impairment analysis, we performed a fair value analysis on our indefinite-lived trademarks and trade names within the Revelyst reportable segment, which resulted in impairment losses of $50,300, related to indefinite lived intangible assets. These losses are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. We performed a step zero analysis on The Kinetic Group indefinite-lived trade names. See Note 11, Goodwill and Intangible Assets , for further information. We calculated the fair value of our indefinite lived intangibles using the relief-from-royalty method which assumes that the asset has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received from them. We estimated the future revenue for the related brands and technology, the appropriate royalty rate, and the weighted average cost of capital. We based our fair values and estimates on assumptions we believed to be reasonable, but which are unpredictable and inherently uncertain. Our assumptions used to develop the discounted cash flow analysis and the relief-from-royalty calculation require us to make significant estimates. The projections also take into account several factors including current and estimated economic trends and outlook, costs of raw materials and other factors that are beyond our control. If the current economic conditions were to deteriorate, or if we were to lose significant business, it is possible that the estimated fair value of certain reporting units or trade names could fall below their carrying value resulting in the necessity to conduct additional impairment tests in future periods. We continually monitor the reporting units and trade names for impairment indicators and update assumptions used in the most recent calculation of the estimated fair value of a reporting unit or trade names as appropriate. Long-Lived Assets —Our long-lived assets consist primarily of property, plant, and equipment, amortizing right-of-use assets related to our operating leases and amortizing costs related to cloud computing arrangements. Our primary identifiable intangible assets include trademarks and trade names, patented technology, and customer relationships. We periodically evaluate the recoverability of the carrying amount of our long-lived assets whenever events or changes in circumstances indicate that the carrying amount of the asset may not be fully recoverable or exceeds its fair value. In conjunction with our interim quantitative goodwill impairment analysis, we performed recoverability tests of our long-lived assets, including amortizing intangible assets, by comparing the net book value of our long-lived assets or asset groups, to the future undiscounted net cash flows attributable to such assets. Based on the results of the recoverability test, we determined that the fair value of certain definite lived intangibles related to trade names and customer relationship within our Outdoor Cooking reporting unit were less than their carrying value. The fair value of these intangibles was determined using the cost approach. As a result, we recorded impairment charges totaling $6,798 related to amortizing intangible assets, which are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. See Note 11, Goodwill and Intangible Assets , for further information. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Dec. 24, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The following section describes the valuation methodologies we use to measure our financial instruments at fair value on a recurring basis: Derivative Financial Instruments Hedging instruments (See Note 5, Derivative Financial Instruments) are re-measured on a recurring basis using broker quotes, daily market foreign currency rates and interest rate curves as applicable and are therefore categorized within Level 2 of the fair value hierarchy. Contingent Consideration In connection with some of our acquisitions, we recorded contingent consideration liabilities that can be earned by the sellers upon achievement of certain milestones. The liabilities are measured on a recurring basis and recorded at fair value, using a discounted cash flow analysis or a Monte Carlo simulation analysis in a risk-neutral framework with assumptions for volatility, market price of risk adjustment, risk-free rate, and cost of debt, utilizing revenue projections for the respective earn-out period, corresponding targets and approximate timing of payments as outlined in the purchase agreements. The inputs used to calculate the fair value of the contingent consideration liabilities are considered to be Level 3 inputs due to the lack of relevant market activity and significant management judgment. Changes in the fair value of the contingent consideration obligation results from changes in discount periods and rates, and changes in probability assumptions with respect to the likelihood of achieving the performance targets. Based on an amendment made to the QuietKat contingent consideration agreement subsequent to quarter end, the estimated fair value of the contingent consideration was increased to $8,915 as of December 24, 2023. The fair value adjustments are recorded in selling, general, and administrative in the condensed consolidated statements of comprehensive income (loss). As of December 24, 2023, the estimated fair values of contingent consideration payable related to our acquisitions of QuietKat, Stone Glacier, and Fox Racing are $8,915, $5,920 and $0, respectively. Cash payouts during fiscal year 2024 related to our Fox Racing and QuietKat liabilities. Contingent consideration liabilities are reported under the following captions in the condensed consolidated balance sheets: December 24, 2023 March 31, 2023 Other current liabilities $ 11,750 $ 8,586 Other long-term liabilities 3,085 11,688 Total $ 14,835 $ 20,274 Following is a summary of our contingent consideration liability Level 3 activity during fiscal year 2024: Balance, March 31, 2023 $ 20,274 Increase in fair value 3,146 Payments made (8,585) Balance, December 24, 2023 $ 14,835 Disclosures about the Fair Value of Financial Instruments The carrying amount of our receivables, inventory, accounts payable, and accrued liabilities as of December 24, 2023 and March 31, 2023 approximates fair value because of the short maturity of these instruments. The carrying values of cash and cash equivalents as of December 24, 2023 and March 31, 2023 are categorized within Level 1 of the fair value hierarchy. The table below discloses information about carrying values and estimated fair value relating to our financial assets and liabilities: December 24, 2023 March 31, 2023 Carrying Fair Carrying Fair Fixed-rate debt (1) $ 500,000 $ 488,000 $ 500,000 $ 404,000 Variable-rate debt (2) 335,000 335,000 560,000 560,000 (1) Fixed rate debt —In fiscal year 2021, we issued $500,000 aggregate principal amount o f 4.5% S enior Notes which will mature on March 15, 2029. These notes are unsecured and senior obligations. The fair value of the fixed-rate debt is based on market quotes for each issuance. We consider these to be Level 2 instruments. See Note 12, Long-term Debt, for additional information on long-term debt, including certain risks and uncertainties. (2) Variable rate debt —The carrying value of the amounts outstanding under our 2022 ABL Revolving Credit Facility and 2022 Term Loan approximates the fair value because the interest rates are variable and reflective of market rates as of December 24, 2023. The fair value of this debt is categorized within Level 2 of the fair value hierarchy based on the observable market borrowing rates. See Note 12, Long-term Debt, for additional information on our credit facilities, including certain risks and uncertainties. During the third fiscal quarter of 2024, we recognized impairment losses related to our goodwill and indefinite-lived intangible assets. The fair value of these assets are categorized within Level 3 of the fair value hierarchy. See Note 1, The Company and Basis of Presentation, and Note 11, Goodwill and Intangible Assets , for discussion and details of the impairment losses recorded in the third fiscal quarter of 2024. We periodically evaluate the recoverability of the carrying amount of our long-lived assets, including amortizing intangible assets, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be fully recoverable or exceeds its fair value. These assets include long-lived assets that are written down to fair value when they are held for sale or determined to be impaired. Se e Note 1, The Company and Basis of Presentation, and Note 11, Goodwill and Intangible Assets , for discussion of an identified trigger event and impairment expense related to certain amortizing intangibles during third fiscal quarter of 2024. See Note 3, Leases , for discussion of right of use asset (ROU) impairments during the fiscal year. Significant assumptions were used to estimate fair value of long-lived assets, which were categorized within Level 3 of the fair value hierarchy. |
Leases
Leases | 9 Months Ended |
Dec. 24, 2023 | |
Leases [Abstract] | |
Leases | Leases We lease certain warehouse and distribution space, manufacturing space, office space, retail locations, equipment, and vehicles. All of these leases are classified as operating leases. Operating lease assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. We use our incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. These rates are assessed on a quarterly basis. The operating lease assets also include any lease payments made less lease incentives. Leases with an initial term of twelve months or less are not recorded on the balance sheet. For operating leases, expense is recognized on a straight-line basis over the lease term. Variable lease payments associated with our leases are recognized upon occurrence of the event, activity, or circumstance in the lease agreement on which those payments are assessed. Tenant improvement allowances are recorded as leasehold improvements with an offsetting adjustment included in our calculation of its right-of-use asset. Many leases include one or more options to renew, with renewal terms that can extend the lease term up to five years. The exercise of lease renewal options is at our sole discretion. 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 leases were as follows: Balance sheet caption December 24, 2023 March 31, 2023 Assets: Operating lease assets Operating lease assets $ 95,906 $ 106,828 Liabilities: Current: Operating lease liabilities Other current liabilities $ 14,316 $ 16,351 Long-term: Operating lease liabilities Long-term operating lease liabilities 95,429 103,313 Total lease liabilities $ 109,745 $ 119,664 The components of lease expense are recorded to cost of sales and selling, general, and administrative expenses in the condensed consolidated statements of comprehensive income (loss). The components of lease expense were as follows: Three months ended Nine months ended December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Fixed operating lease costs (1) $ 6,757 $ 7,406 $ 21,026 $ 20,300 Variable operating lease costs 1,208 522 3,453 1,980 Operating and sub-lease income (262) (157) (692) (464) Net lease costs $ 7,703 $ 7,771 $ 23,787 $ 21,816 (1) Includes short-term leases, which are immaterial. The weighted average remaining lease term and weighted average discount rate is as follows: December 24, 2023 March 31, 2023 Weighted average remaining lease term (years): Operating leases 9.34 9.71 Weighted average discount rate: Operating leases 8.52 % 8.43 % The approximate minimum lease payments under non-cancelable operating leases as of December 24, 2023 are as follows: Remainder of fiscal year 2024 $ 6,546 Fiscal year 2025 21,412 Fiscal year 2026 19,562 Fiscal year 2027 17,041 Fiscal year 2028 14,683 Thereafter 84,463 Total lease payments 163,707 Less imputed interest (53,962) Present value of lease liabilities $ 109,745 Supplemental cash flow information related to leases is as follows: Nine months ended December 24, 2023 December 25, 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows - operating leases $ 20,239 $ 16,623 Operating lease assets obtained in exchange for lease liabilities: Operating leases 7,498 33,228 ROU asset re-measurements (6,105) 40 As part of integrating our recent acquisitions, we made strategic decisions to close office locations which are actively being marketed for sublease. Accordingly, during the three months ended and nine months ended December 24, 2023, we recognized ROU asset impairment of $43 and $2,845, respectively, reducing the carrying value of the lease asset to its estimated fair value. |
Acquisitions
Acquisitions | 9 Months Ended |
Dec. 24, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions | Acquisitions During the second quarter of fiscal year 2023, we acquired Simms Fishing Products (Simms), a premium fishing brand and leading manufacturer of waders, outerwear, footwear and technical apparel. We finalized the purchase price allocation during the fourth quarter of fiscal year 2023, and no significant changes were recorded from the original estimation. The results of this business are reported within the Fishing operating segment and the Revelyst reportable segment. During the second quarter of fiscal year 2023, we acquired Fox (Parent) Holdings, Inc. (“Fox Racing”), a leader in motocross industry and a growing brand in the mountain bike category. We finalized the purchase price allocation during the fourth quarter of fiscal year 2023, and no significant changes were recorded from the original estimation. The results of this business are reported within the Sports Protection operating segment and the Revelyst reportable segment. Fiscal year 2023 Fox Racing supplemental pro forma data: Fox's net sales of $124,523 and net income of $2,498 since the acquisition date, August 5, 2022, were included in our consolidated results for the nine months ended December 25, 2022, are included in our consolidated results in the Revelyst reportable segment. The following unaudited pro forma financial information presents our results as if the Fox Racing acquisition had occurred on April 1, 2021: Three months ended December 25, 2022 Nine months ended December 25, 2022 Sales, net $ 754,775 $ 2,444,920 Net income 68,075 286,732 The unaudited supplemental pro forma data above includes the following significant non-recurring adjustments to net income to account for certain costs which would have been incurred if the Fox Racing acquisition had been completed on April 1, 2021: Three months ended December 25, 2022 Nine months ended December 25, 2022 Fees for advisory, legal, and accounting services (1) $ (99) $ (6,064) Inventory step-up, net (2) (3,772) (6,287) Interest (3) — 10,627 Depreciation (4) — 719 Amortization (5) — 4,245 Management Fees (6) — (530) Income tax provision (benefit) (7) 943 (1,199) (1) During the three months and nine months ended December 25, 2022, we incurred a total of $99 and $6,064 in acquisition related costs, including legal and other professional fees, all of which were reported in selling, general, and administrative expense in the condensed consolidated statements of comprehensive income (loss). This adjustment is to show the results as if those fees were incurred during the first quarter of fiscal year 2022. (2) Adjustment reflects the increased cost of goods sold expense resulting from the fair value step-up in inventory, which was expensed over inventory turns. (3) Adjustment for the estimated interest expense and debt issuance amortization expense on $580,000 in borrowings from Vista's 2022 ABL Revolving Credit Facility and 2022 Term Loan, used to finance the acquisition of Fox Racing. The interest rate assumed for purposes of preparing this pro forma financial information is 5.58%. This rate is the weighted average interest rate for our borrowings under the 2022 ABL Revolving Credit Facility and 2022 Term Loan during the quarter of the acquisition. (4) Adjustment for depreciation related to the revised fair-value basis of the acquired property, plant and equipment and change in estimated useful lives. (5) Adjustment for amortization of acquired intangible assets. (6) Represents an adjustment for management fees historically charged by the previous owner of Fox Racing under the terms of their management agreement. (7) Income tax effect of the adjustments made at a blended federal, state, and international statutory rate adjusted for any non-deductible acquisition costs. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Dec. 24, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments Commodity Price Risk We use designated cash flow hedges to hedge our exposure to price fluctuations on lead we purchase for raw material components in our ammunition manufacturing process that are designated and qualify as effective cash flow hedges. The effectiveness of cash flow hedge contracts is assessed quantitatively at inception and qualitatively thereafter considering the transactions critical terms and counterparty credit quality. The gains and losses on these hedges are included in accumulated other comprehensive loss and are reclassified into earnings at the time the forecasted revenue or expense is recognized. The gains or losses on the lead forward contracts are recorded in inventory as the commodities are purchased and in cost of sales when the related inventory is sold. As of December 24, 2023, we had outstanding lead forward contracts on approximately 1.3 million pounds of lead. In the event the underlying forecasted transaction does not occur, or it becomes probable that it will not occur, the related change in fair value of the derivative instrument would be reclassified from accumulated other comprehensive loss and recognized in earnings. The asset related to the lead forward contracts is immaterial and is recorded as part of other current assets. Foreign Exchange Risk In the normal course of business, we are exposed to gains and losses resulting from fluctuations in foreign currency exchange rates relating to transactions of our international subsidiaries. We use designated cash flow hedges and non-designated hedges in the form of foreign currency forward contracts as part of our strategy to manage the level of exposure to the risk of fluctuations in foreign currency exchange rates and to mitigate the impact of foreign currency translation on transactions that are denominated primarily in British Pounds, Euros, and Canadian Dollars. Cash Flow Hedging Instrument From time to time, we use foreign currency forward contracts designated as qualifying cash flow hedging instruments to help mitigate our exposure on our foreign subsidiaries' inventory purchases and intercompany transactions, which is different than their functional currency. Certain U.S. subsidiaries also hedge a portion of their future sales in Canadian Dollars. These contracts generally mature within 12 months to 15 months from their inception. As of December 24, 2023, the notional amounts of our foreign currency forward contracts designated as cash flow hedge instruments were approximately $3,518. The effectiveness of cash flow hedge contracts is assessed quantitatively at inception and qualitatively thereafter considering the transactions critical terms and counterparty credit quality. As of December 24, 2023, we have no remaining foreign currency forward contracts not designated as cash flow hedge instruments. During the three and nine months ended December 24, 2023 and December 25, 2022, we recorded net foreign currency translation and gains of $509 and $720, respectively, and $33 and $866, respectively, on the condensed consolidated statements of comprehensive income (loss) within Other income (expense), net. Interest Rate swaps During fiscal year 2023, we entered into floating-to-fixed interest rate swaps in order to mitigate the risk of changes in our interest rates on our outstanding variable-rate debt. We will receive variable interest payments from the counterparty lenders in exchange for fixed interest rate payments made by us. As of December 24, 2023, we had the following interest rate swaps outstanding: Notional Fair Value Pay Fixed Receive Floating Maturity Date Non-amortizing swap $ 50,000 $ (499) 4.910% 5.378% Feb 2026 Non-amortizing swap 25,000 (352) 4.650% 5.345% Mar 2026 The amount paid or received under these swaps is recorded as an adjustment to interest expense. All unrealized gains and losses as shown as of December 24, 2023 will be recognized in the condensed consolidated statements of comprehensive income (loss) in interest expense within the next two fiscal years, at their then-current value. The following table summarizes the fair value of our derivative instruments as well as the location of the asset and/or liability on the condensed consolidated balance sheets as of December 24, 2023 and consolidated balance sheets as of March 31, 2023: Asset derivatives Derivatives not designated as hedging instruments Balance sheet location December 24, 2023 March 31, 2023 Foreign currency forward contracts Other current assets $ — $ 91 Total $ — $ 91 Liability derivatives Derivatives designated as cash flow hedging instruments Balance sheet location December 24, 2023 March 31, 2023 Foreign currency forward contracts Other current liabilities $ 69 $ 3,252 Interest rate swap contract Other long-term liabilities 851 1,760 Total $ 920 $ 5,012 The following tables summarize the net effect of all cash flow hedges for each of our derivative contracts on the condensed consolidated financial statements for the three and the nine months ended December 24, 2023 and December 25, 2022, respectively: Gain (loss) recognized in other comprehensive income Three months ended Nine months ended Derivatives designated as cash flow hedging instruments: December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Foreign currency forward contracts $ (100) $ (2,920) $ 142 $ (2,920) Lead forward contracts (123) 2,335 153 1,305 Interest rate swap contracts (1,123) — 1,269 — Total gain (loss) $ (1,346) $ (585) $ 1,564 $ (1,615) Gain (loss) reclassified from other comprehensive income into earnings Three months ended Nine months ended Derivatives designated as cash flow hedging instruments: Location December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Foreign currency forward contracts Cost of sales $ (160) $ — $ (1,349) $ — Foreign currency forward contracts Other income (expense), net (417) — (1,634) — Lead forward contracts Cost of sales 141 94 431 123 Interest rate swap contracts Interest expense, net 156 — 360 — Total gain (loss) $ (280) $ 94 $ (2,192) $ 123 |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Dec. 24, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition The following tables disaggregate our net sales by major product category: Three months ended December 24, 2023 December 25, 2022 The Kinetic Group Revelyst Total The Kinetic Group Revelyst Total Sporting Products (1) $ 364,949 $ — $ 364,949 $ 401,504 $ — $ 401,504 Outdoor Accessories (2) — 74,648 74,648 — 79,623 79,623 Action Sports (3) — 111,778 111,778 — 132,322 132,322 Outdoor Recreation (4) — 130,878 130,878 — 141,326 141,326 Total $ 364,949 $ 317,304 $ 682,253 $ 401,504 $ 353,271 $ 754,775 Geographic Region: United States $ 330,556 $ 248,273 $ 578,829 $ 367,056 $ 261,090 $ 628,146 Rest of the world 34,393 69,031 103,424 34,448 92,181 126,629 Total $ 364,949 $ 317,304 $ 682,253 $ 401,504 $ 353,271 $ 754,775 Nine months ended December 24, 2023 December 25, 2022 The Kinetic Group Revelyst Total The Kinetic Group Revelyst Total Sporting Products (1) $ 1,091,041 $ — $ 1,091,041 $ 1,344,620 $ — $ 1,344,620 Outdoor Accessories (2) — 188,700 188,700 — 221,704 221,704 Action Sports (3) — 367,076 367,076 — 373,139 373,139 Outdoor Recreation (4) — 405,577 405,577 — 399,602 399,602 Total $ 1,091,041 $ 961,353 $ 2,052,394 $ 1,344,620 $ 994,445 $ 2,339,065 Geographic Region: United States $ 985,321 $ 719,000 $ 1,704,321 $ 1,244,437 $ 693,305 $ 1,937,742 Rest of the world 105,720 242,353 348,073 100,183 301,140 401,323 Total $ 1,091,041 $ 961,353 $ 2,052,394 $ 1,344,620 $ 994,445 $ 2,339,065 (1) Sporting Products includes the Ammunition operating segment. (2) Outdoor Accessories includes the Outdoor Accessories operating segment. (3) Action Sports includes the operating segments: Sports Protection and Cycling. (4) Outdoor Recreation includes the operating segments: Hydration, Outdoor Cooking, Golf, Fishing, and our Stone Glacier business. For the majority of our contracts with customers, we recognize revenue for our products at a point in time upon the transfer of control of the products to the customer, which typically occurs upon shipment and coincides with our right to payment, the transfer of legal title, and the transfer of the significant risks and rewards of ownership of the product. For our contracts that include bundled and hardware and software sales, revenue related to delivered hardware and bundled software is recognized when control has transferred to the customer, which typically occurs upon shipment. Revenue allocated to unspecified software update rights is deferred and recognized on a straight-line basis over the estimated period they are expected to be provided. Typically, our contracts require customers to pay within 30-60 days of product delivery with a discount available to some customers for early payment. In some cases, we offer extended payment terms to customers. However, we do not consider these extended payment terms to be a significant financing component of the contract because the payment terms are less than a year. In limited circumstances, our contract with a customer may have shipping terms that indicate a transfer of control of the products upon their arrival at the destination rather than upon shipment. In those cases, we recognize revenue only when the product reaches the customer destination, which may require us to estimate the timing of transfer of control based on the expected delivery date. In all cases, however, we consider our costs related to shipping and handling to be a cost of fulfilling the contract with the customer. The total amount of revenue we recognize for the sale of our products reflects various sales adjustments for discounts, returns, refunds, allowances, rebates, and other customer incentives. These sales adjustments can vary based on market conditions, customer preferences, timing of customer payments, volume of products sold, and timing of new product launches. These adjustments require management to make reasonable estimates of the amount we expect to receive from the customer. We estimate sales adjustments by customer or by product category on the basis of our historical experience with similar contracts with customers, adjusted as necessary to reflect current facts and circumstances and our expectations for the future. Sales taxes, federal excise taxes, and other similar taxes are excluded from revenue. For the immaterial amount of our contracts that have multiple performance obligations, which represent promises within an arrangement that are distinct, we allocate revenue to all distinct performance obligations based on their relative stand-alone selling prices (“SSPs”). When available, we use observable prices to determine SSPs. When observable prices are not available, SSPs are established that reflect our best estimates of what the selling prices of the performance obligations would be if they were sold regularly on a stand-alone basis. We allocate revenue and any related discounts to these performance obligations based on their relative SSPs. Incentives in the form of cash paid to the customer (or a reduction of a customer cash payment to us) typically are recognized as a reduction of sales unless the incentive is for a distinct benefit that we receive from the customer, e.g., advertising or marketing. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Dec. 24, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The computation of basic earnings per share ("EPS") is based on the weighted average number of shares that were outstanding during the period. The computation of diluted EPS is based on the number of basic weighted average shares outstanding plus the number of common shares that would be issued assuming the exercise of all potentially dilutive common shares, such as common stock to be issued upon exercise of options, contingently issuable shares and restricted stock units, using the treasury stock method. In computing EPS for the periods presented, earnings, as reported for each respective period, is divided by the number of shares below: Three months ended Nine months ended (Amounts in thousands except per share data) December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Numerator: Net income (loss) $ (148,195) $ 65,147 $ (45,673) $ 284,617 Denominator: Weighted-average number of common shares outstanding basic: 58,078 56,574 57,866 56,538 Dilutive effect of share-based awards (1) — 1,269 — 1,484 Diluted shares 58,078 57,843 57,866 58,022 Earnings (loss) per common share: Basic $ (2.55) $ 1.15 $ (0.79) $ 5.03 Diluted $ (2.55) $ 1.13 $ (0.79) $ 4.91 (1) Due to the loss from continuing operations for the three and nine months ended December 24, 2023, there are no common shares added to calculate dilutive EPS because the effect would be anti-dilutive. Potentially dilutive securities of 300 were excluded from diluted EPS in three and nine months ended December 24, 2023, as we had a net loss. Potentially dilutive securities, which were not included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive, or the options’ exercise prices were greater than the average market price of the common stock were 23 and 316 for the three and nine months ended December 25, 2022, respectively. |
Receivables
Receivables | 9 Months Ended |
Dec. 24, 2023 | |
Receivables [Abstract] | |
Receivables | Receivables Our trade accounts receivables are recorded at net realizable value, which includes an appropriate allowance for estimated credit losses. We maintain an allowance for credit losses related to accounts receivable for future expected credit losses resulting from the inability or unwillingness of our customers to make required payments. We estimate the allowance based upon historical bad debts, current customer receivable balances, age of customer receivable balances and the customers' financial condition, and in relation to a representative pool of assets consisting of a large number of customers with similar risk characteristics. The allowance is adjusted as appropriate to reflect differences in current conditions as well as changes in forecasted macroeconomic conditions. Receivables that do not share risk characteristics are evaluated on an individual basis, including those associated with customers that have a higher probability of default. Net receivables are summarized as follows: December 24, 2023 March 31, 2023 Trade receivables $ 377,943 $ 349,424 Other receivables 16,095 8,899 Less: allowance for estimated credit losses and discounts (20,028) (18,950) Net receivables $ 374,010 $ 339,373 Walmart represented 12% and 10% of our total trade receivables balance as of December 24, 2023 and March 31, 2023, respectively. The following provides a reconciliation of the activity related to the allowance for estimated credit losses for the nine months ended December 24, 2023: Balance, March 31, 2023 $ 18,950 Provision for credit losses 2,228 Write-off of uncollectible amounts, net of recoveries (1,150) Balance, December 24, 2023 $ 20,028 |
Inventories
Inventories | 9 Months Ended |
Dec. 24, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Current net inventories consist of the following: December 24, 2023 March 31, 2023 Raw materials $ 198,497 $ 199,225 Work in process 66,899 63,652 Finished goods 389,443 447,020 Net inventories $ 654,839 $ 709,897 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss (AOCL) | 9 Months Ended |
Dec. 24, 2023 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss (AOCL) | Accumulated Other Comprehensive Loss (AOCL) The components of AOCL, net of income taxes, are as follows: December 24, 2023 March 31, 2023 Derivatives $ (683) $ (3,543) Pension and other postretirement benefits liabilities (69,763) (71,449) Cumulative translation adjustment (4,885) (5,810) Total AOCL $ (75,331) $ (80,802) The following tables detail the amounts reclassified from AOCL to earnings as well as the changes in derivatives, pension and other postretirement benefits, and foreign currency translation: Three months ended December 24, 2023 Nine months ended December 24, 2023 Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Beginning balance in AOCL $ 129 $ (70,325) $ (5,839) $ (76,035) $ (3,543) $ (71,449) $ (5,810) $ (80,802) Change in fair value of derivatives (1,346) — — (1,346) 1,564 — — 1,564 Income tax impact on derivative instruments 254 — — 254 (896) — — (896) Net losses reclassified from AOCL 280 — — 280 2,192 — — 2,192 Net actuarial losses reclassified from AOCL (1) — 562 — 562 — 1,686 — 1,686 Net change in cumulative translation adjustment — — 954 954 — — 925 925 Ending balance in AOCL $ (683) $ (69,763) $ (4,885) $ (75,331) $ (683) $ (69,763) $ (4,885) $ (75,331) (1) Amounts related to our pension and other postretirement benefits that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented, net of tax. Three months ended December 25, 2022 Nine months ended December 25, 2022 Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Beginning balance in AOCL $ (634) $ (69,687) $ (7,119) $ (77,440) $ (356) $ (71,075) $ (5,248) $ (76,679) Change in fair value of derivatives (585) — — (585) (1,615) — — (1,615) Income tax impact on derivative instruments 164 — — 164 945 — — 945 Net gains reclassified from AOCL (94) — — (94) (123) — — (123) Net actuarial losses reclassified from AOCL (1) — 694 — 694 — 2,082 — 2,082 Net change in cumulative translation adjustment — — 994 994 — — (877) (877) Ending balance in AOCL $ (1,149) $ (68,993) $ (6,125) $ (76,267) $ (1,149) $ (68,993) $ (6,125) $ (76,267) (1) Amounts related to our pension and other postretirement benefits that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented. See Note 13, Employee Benefit Plans . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Dec. 24, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The carrying value of goodwill by reportable segment was as follows: The Kinetic Group Revelyst Total Balance, March 31, 2023 $ 86,105 $ 379,604 $ 465,709 Impairment — (161,714) (161,714) Balance, December 24, 2023 $ 86,105 $ 217,890 $ 303,995 As of December 24, 2023 and March 31, 2023 $1,488,676 and $1,326,962 of accumulated impairment losses, recorded within the Revelyst segment, respectively. The goodwill recorded within The Kinetic Group segment has no accumulated impairment losses. Fiscal year 2024 impairment During the third fiscal quarter of 2024, we concluded that triggering events had occurred, potentially indicating that the fair values of our reporting units within our Revelyst reportable segment were less than their carrying values. We recognized impairment losses equal to the full carrying value of goodwill of $26,219 and $9,955, related to the reporting units of Outdoor Cooking and Stone Glacier, respectively, and a partial goodwill impairment loss of $125,540 related to our Golf reporting unit. Goodwill relating to the Ammunition reporting unit was not impaired as the fair value exceeded the carrying value. Our Ammunition and Golf reporting units comprise our remaining goodwill at December 24, 2023. See Note 1, The Company and Basis of Presentation , for the discussion of the triggering event and goodwill impairment analysis performed. Additionally, we recorded impairment losses of $26,600, $9,600, $6,100, $4,500 $1,800, $1,100, and $600 related to the Fox Racing, Camelbak, Bell Cycling, Simms Fishing, Giro, Bushnell, and Bell Powersports indefinite-lived tradename assets, respectively. The carrying value of the indefinite lived intangible assets related to Fox Racing, Camelbak, Bell Cycling, Simms Fishing, Giro, Bushnell, and Bell Powersports after the impairment was $58,400, $13,300, $12,000, $25,500, $15,300, $14,900, and $3,500, respectively, at December 24, 2023. We determined the fair value of our Fox Racing, Camelbak, Bell Cycling, Simms Fishing, Giro, Bushnell, and Bell Powersports indefinite-lived trade names using royalty rates of 3%, 1.5%, 1.5%, 3%, 1.5%, 1%, and 1%, respectively. Intangible assets by major asset class consisted of the following: December 24, 2023 March 31, 2023 Gross Accumulated Total Gross Accumulated Total Trade names $ 112,686 $ (35,902) $ 76,784 $ 113,915 $ (30,848) $ 83,067 Patented technology 36,854 (18,515) 18,339 36,854 (16,313) 20,541 Customer relationships and other 523,192 (180,320) 342,872 530,237 (151,272) 378,965 Total 672,732 (234,737) 437,995 681,006 (198,433) 482,573 Non-amortizing trade names 200,303 — 200,303 250,603 — 250,603 Net intangible assets $ 873,035 $ (234,737) $ 638,298 $ 931,609 $ (198,433) $ 733,176 The decrease in the gross carrying amount of amortizing intangible assets during the nine months ended fiscal year 2024 was due to impairment as discussed in Note 1, The Company and Basis of Presentation, less increases due to the impact of foreign exchange rates. We recorded impairment expense related to customer relationship and trade name intangibles within our Outdoor Cooking reporting unit, net of accumulated amortization of $5,805 and $993, respectively. The decrease in non-amortizing trade names is due to impairment as discussed above. Amortization expense was $12,490 and $12,448 for the three months ended December 24, 2023 and December 25, 2022, respectively, and was $37,826 and $31,431 for the nine months ended December 24, 2023 and December 25, 2022, respectively. The amortizable intangible assets in the table above are being amortized using a straight-line method over a weighted average remaining period of approximately 11.65 years. As of December 24, 2023, we expect amortization expense related to these assets to be as follows: Remainder of fiscal year 2024 $ 12,441 Fiscal year 2025 49,746 Fiscal year 2026 46,736 Fiscal year 2027 45,286 Fiscal year 2028 40,116 Thereafter 243,670 Total $ 437,995 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Dec. 24, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-term Debt Long-term debt consisted of the following: December 24, 2023 March 31, 2023 2022 ABL Revolving Credit Facility $ 270,000 $ 355,000 2022 Term Loan 65,000 205,000 Total Principal Amount of Credit Agreements 335,000 560,000 4.5% Senior Notes 500,000 500,000 Total Principal Amount of Long-Term Debt 835,000 1,060,000 Less: unamortized deferred financing costs related to term loans (6,014) (10,342) Carrying amount of long-term debt 828,986 1,049,658 Less: current portion (65,000) (65,000) Carrying amount of long-term debt, excluding current portion $ 763,986 $ 984,658 Credit Agreements —On August 5, 2022, we refinanced our 2021 ABL Revolving Credit Facility by entering into the 2022 ABL Revolving Credit Facility, which provides for a $600,000 senior secured asset-based revolving credit facility. The amount available under the 2022 ABL Revolving Credit Facility is the lesser of the total commitment of $600,000 or a borrowing base based on percentages of eligible receivables, inventory, and cash, minus certain reserves, but, in each case, subject to the excess availability financial covenant under the 2022 ABL Revolving Credit Facility described below. As of December 24, 2023, the Excess Availability, or the amount available to borrow under the 2022 ABL Revolving Credit Facility, based on the borrowing base less outstanding borrowings of $270,000 and outstanding letters of credit of $14,878, less the minimum required borrowing base of $57,000, was $208,566. The 2022 ABL Revolving Credit Facility matures on March 31, 2026 (the “Maturity Date”), subject to a customary springing maturity in respect of the 4.5% Notes due 2029 (described below) and the 2022 Term Loan (described below). Any outstanding revolving loans under the 2022 ABL Revolving Credit Facility will be payable in full on the Maturity Date. Concurrently with the effectiveness of the 2022 ABL Revolving Credit Facility, we also obtained a $350,000 senior secured asset-based term loan facility (the “2022 Term Loan”). The 2022 Term Loan matures on August 5, 2024 (the "Term Maturity Date") and is subject to quarterly principal payments on the last business day of each quarter in an amount equal to (i) 12.5% of the original principal amount of the 2022 Term Loan if the aggregate outstanding principal balance of the 2022 Term Loan exceeds the Term Loan Formula Threshold described below, or (ii) 10.0% of the original principal amount of the 2022 Term Loan if the aggregate outstanding principal balance of the 2022 Term Loan is equal to or less than the Term Loan Formula Threshold described below. As of December 24, 2023, our quarterly principal payments are equal to 10.0% of the original principal amount of the 2022 Term Loan. The 2022 Term Loan is also subject to certain mandatory prepayment requirements, including with respect to the net cash proceeds from the sale of certain collateral, subject to our rights to reinvest such proceeds, and a percentage of our excess cash flow, to be calculated annually. The Term Loan Formula Threshold is based on a percentage of the appraisal value of eligible intellectual property, eligible machinery and equipment, and the fair market value of eligible real property minus certain reserves. Any outstanding term loans under the 2022 Term Loan will be payable in full on the Term Maturity Date. Borrowings under the 2022 ABL Revolving Credit Facility bear interest at a rate equal to either the sum of a base rate plus a margin ranging from 0.25% to 0.75% or the sum of a Term Secured Overnight Financing Rate ("Term SOFR") plus a credit spread adjustment of 0.10%, plus a margin ranging from 1.25% to 1.75%. The margins vary based on our Average Excess Availability under the 2022 ABL Revolving Credit Facility. As of December 24, 2023, the margin under the 2022 ABL Revolving Credit Facility was 0.5% for base rate loans and 1.5% for Term SOFR loans. We pay a commitment fee on the unused commitments under the 2022 ABL Revolving Credit Facility of 0.175% per annum. Borrowings under the 2022 Term Loan bear interest at a rate equal to either the sum of a base rate plus a margin ranging from 2.50% to 3.00% or the sum of Term SOFR plus a credit spread adjustment of 0.10%, plus a margin ranging from 3.50% to 4.00%. The margins vary based on our Term Loan Formula Threshold under the 2022 Term Loan. As of December 24, 2023, the margin under the 2022 Term Loan was 2.50% for base rate loans and 3.50% for Term SOFR loans. As of December 24, 2023, the weighted average interest rate for our borrowings under the 2022 ABL Revolving Credit Facility and 2022 Term Loan was 7.18%. Debt issuance costs incurred to date related to the 2022 ABL Revolving Credit Facility were approximately $11,310, which included remaining unamortized debt issuance costs related to the 2021 ABL Credit Facility. These costs were initially included in other current and non-current assets and are being amortized over the term of the 2022 ABL Revolving Credit Facility to interest expense. We incurred debt issuance costs related to the 2022 Term Loan of approximately $10,453. The debt issuance costs associated with the 2022 Term Loan are being amortized to interest expense over 2 years. Substantially all domestic tangible and intangible assets of Vista Outdoor and our domestic subsidiaries are pledged as collateral under the 2022 ABL Revolving Credit Facility and 2022 Term Loan. 4.5% Notes —In fiscal year 2021, we issued $500,000 aggregate principal amount of 4.5% Notes that mature on March 15, 2029. These notes are unsecured and senior obligations. Interest on the notes is payable semi-annually in arrears on March 15 and September 15 of each year. We have the right to redeem some or all of these notes on or after March 15, 2024 at specified redemption prices. Prior to March 15, 2024, we may redeem some or all of these notes at a price equal to 100% of their principal amount plus accrued and unpaid interest to the date of redemption and a specified make-whole premium. In addition, prior to March 15, 2024, we may redeem up to 40% of the aggregate principal amount of these notes with the net cash proceeds of certain equity offerings, at a price equal to 104.5% of their principal amount plus accrued and unpaid interest to the date of redemption. Debt issuance costs of approximately $4,491 are being amortized to interest expense over eight years, the term of the notes. Rank and guarantees —The 2022 ABL Revolving Credit Facility and 2022 Term Loan obligations are guaranteed on a secured basis, jointly and severally and fully and unconditionally by substantially all of our domestic subsidiaries. Vista Outdoor (the parent company issuer) has no independent assets or operations. We own 100% of all of these guarantor subsidiaries. The 4.5% Notes are senior unsecured obligations of Vista Outdoor and will rank equally in right of payment with any future senior unsecured indebtedness and senior in right of payment to any future subordinated indebtedness of Vista Outdoor. The 4.5% Notes are fully and unconditionally guaranteed, jointly and severally, by our existing and future domestic subsidiaries that guarantee indebtedness under our 2022 ABL Revolving Credit Facility and 2022 Term Loan or that incur or guarantee certain of our other indebtedness, or indebtedness of any subsidiary guarantor, in an aggregate principal amount in excess of $75,000. These guarantees are senior unsecured obligations of the applicable subsidiary guarantors. The guarantee by any subsidiary guarantor of our obligations in respect of the 4.5% Notes will be released in any of the following circumstances: • if, as a result of the sale of its capital stock, such subsidiary guarantor ceases to be a restricted subsidiary, • if such subsidiary guarantor is designated as an “Unrestricted Subsidiary”, • upon defeasance or satisfaction and discharge of the 4.5% Notes, or • if such subsidiary guarantor has been released from its guarantees of indebtedness under the 2022 ABL Revolving Credit Facility and 2022 Term Loan and all capital markets debt securities Covenants 2022 ABL Revolving Credit Facility —Our 2022 ABL Revolving Credit Facility and 2022 Term Loan impose restrictions on us, including limitations on our ability to pay cash dividends, incur debt or liens, redeem or repurchase Vista Outdoor stock, enter into transactions with affiliates, make investments, merge or consolidate with others or dispose of assets. Each of the 2022 ABL Revolving Credit Facility and 2022 Term Loan contains a financial covenant which requires that Excess Availability under the 2022 ABL Revolving Credit Facility cannot fall below the greater of (a) 10% of the line cap or (b) $57,000. As a result of this financial covenant, we must maintain Excess Availability of at least the greater of 10% of the line cap or $57,000 at all times in order to satisfy the financial covenant. In addition, as long as the 2022 Term Loan remains outstanding, we also must maintain a maximum consolidated leverage ratio (as defined in the credit agreement) of 3.00:1.00 as of the end of each fiscal quarter. As of December 24, 2023, the consolidated leverage ratio was 1.8. Each of the 2022 ABL Revolving Credit Facility and the 2022 Term Loan includes a covenant that prohibits the “Planned Separation” (as defined in Vista Outdoor’s Form 10-K filing for the fiscal year ended March 31, 2022) with respect to the separation of Vista Outdoor’s Revelyst and The Kinetic Group segments or any analogous transaction with respect to any line of business, business segment or division (or any part thereof) of Vista Outdoor or any subsidiary thereof. In October 2023, we announced our entry into a definitive agreement to sell The Kinetic Group business to Czechoslovak Group a.s. (“CSG”) on a cash-free, debt-free basis with a normalized level of working capital (the "The Kinetic Group Sale" or the “Sporting Products Sale”). See Sale of Sporting Products and Planned Separation in the Executive Summary of Part I, Item 2 of this Quarterly Report on Form 10-Q for further discussion of the Sporting Products Sale. Vista Outdoor anticipates that each of the 2022 ABL Revolving Credit Facility and the 2022 Term Loan will be repaid in full (or, in the case of the 2022 ABL Revolving Credit Facility, amended to unconditionally release all The Kinetic Group entities from their obligations thereunder) prior to or upon the consummation of the Sporting Products Sale. If we do not comply with the covenants in the 2022 ABL Revolving Credit Facility or 2022 Term Loan, the lenders under the applicable facility may, subject to customary cure rights, require the immediate payment of all amounts outstanding under such facility. As noted above, the Excess Availability less the minimum required borrowing base under the 2022 ABL Revolving Credit Facility was $208,566 as of December 24, 2023. Vista Outdoor has the option to increase the amount of the 2022 ABL Revolving Credit Facility in an aggregate principal amount not to exceed $150,000, to the extent that any one or more lenders, whether or not currently party to the 2022 ABL Revolving Credit Facility, commit to be a lender for such amount. 4.5% Notes —The indenture governing the 4.5% Notes contains covenants that, among other things, limit our ability to incur or permit to exist certain liens, sell, transfer or otherwise dispose of assets, consolidate, amalgamate, merge or sell all or substantially all of our assets, enter into transactions with affiliates, enter into agreements restricting our subsidiaries’ ability to pay dividends, incur additional indebtedness, pay dividends, make other distributions, repurchase, or redeem our capital stock, prepay, redeem or repurchase certain debt and make loans and investments. Vista Outdoor anticipates that the 4.5% Notes will be redeemed in full upon the consummation of the Sporting Products Sale. See Sale of Sporting Products and Planned Separation in the Executive Summary of Part I, Item 2 of this Quarterly Report on Form 10-Q for further discussion of the Sporting Products Sale. The 2022 ABL Revolving Credit Facility, the 2022 Term Loan, and the indenture governing the 4.5% Notes contain cross-default provisions so that noncompliance with the covenants within one debt agreement could also cause a default under the other debt agreement. As of December 24, 2023, we were in compliance with the covenants of all of our debt agreements. However, we cannot provide assurance that we will be able to comply with such financial covenants in the future due to various risks and uncertainties, some of which may be beyond our control. Any failure to comply with the restrictions in the 2022 ABL Revolving Credit Facility and 2022 Term Loan may prevent us from drawing under these loans and may result in an event of default under the 2022 ABL Revolving Credit Facility and 2022 Term Loan, which default may allow the creditors to accelerate the related indebtedness and the indebtedness under our 4.5% Notes and proceed against the collateral that secures such indebtedness. We may not have sufficient liquidity to repay the indebtedness in such circumstances. Interest Rate swaps During fiscal year 2023, we entered into floating-to-fixed interest rate swaps in order to mitigate the risk of changes in our interest rates on our outstanding variable-rate debt. We will receive variable interest payments from the counterparty lenders in exchange for fixed interest rate payments made by us. See Note 5, Derivative Financial Instruments , for additional information on our interest rate swap contracts. Cash Paid for Interest on Debt Cash paid for interest on debt, for the three months ended December 24, 2023 and December 25, 2022 totaled $10,218 and $11,800, respectively. Cash paid for interest on debt, for the nine months ended December 24, 2023 and December 25, 2022 totaled $40,031 and $25,011, respectively. |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Dec. 24, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans We recognized an aggregate net loss of $237 and $382 for employee defined benefit plans during the three months ended December 24, 2023 and December 25, 2022, respectively. We recognized an aggregate net loss of $711 and $1,144 for employee defined benefit plans during the nine months ended December 24, 2023 and December 25, 2022, respectively. Employer contributions and distributions —We made contributions of $0 and $0 to our pension trust during the nine months ended December 24, 2023 and December 25, 2022, respectively. No additional contributions are required and we are not expecting to make any contributions to our pension trust for the remainder of fiscal year 2024. For those same periods, we made no contributions to our other postretirement benefit plans, and we made no distributions to retirees under our non-qualified supplemental executive retirement plan. No additional contributions are required and we are not expecting to make any contributions to our other postretirement benefit plans, or directly to retirees under our non-qualified supplemental executive retirement plans for the remainder of fiscal year 2024. |
Income Taxes
Income Taxes | 9 Months Ended |
Dec. 24, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our provision for income taxes includes federal, foreign, and state income taxes. Income tax provisions for interim periods are based on the estimated effective annual income tax rates for the current year and the prior year. The income tax provisions for the three months ended December 24, 2023 and December 25, 2022 represent effective tax rates of 24.1% and 16.9%, respectively. The increase in the effective tax rate from the prior year three month period is primarily driven by the release of tax reserves for uncertain tax positions offset in part by nondeductible goodwill impairment in the current period, the beneficial true-up of prior year taxes, and non-taxable contingent consideration income in the prior year quarter. Because of losses in the current period, favorable tax adjustments cause an increase in the rate. The income tax provisions for the nine months ended December 24, 2023 and December 25, 2022 represent effective tax rates of 26.1% and 21.5%, respectively. The increase in the effective tax rate from the prior year nine month period is primarily driven by the release of tax reserves for uncertain tax positions offset in part by nondeductible goodwill impairment in the current period. Because of losses in the current period, favorable tax adjustments cause an increase in the rate. The effective tax rate for the three and nine months ended December 24, 2023 was higher than the statutory rate of 21% because of the loss in the current period, which caused favorable tax adjustments such as release of reserves for uncertain tax positions and the deduction for Foreign-Derived Intangible Income to increase the rate partially offset by nondeductible goodwill impairment. The effective tax rate for the three and nine months ended December 25, 2022 differed from the federal statutory rate of 21% due to state taxes and the beneficial impact of the prior year tax return filings and non-taxable contingent consideration income. Income taxes paid, net of refunds, totaled $53,184 and $69,708 for the nine months ended December 24, 2023 and December 25, 2022, respectively. We have classified uncertain tax positions as non-current income tax liabilities unless expected to be paid within one year. The amount of unrecognized tax benefits, including interest and penalties, amounted to $26,386 and $28,692 as of December 24, 2023 and March 31, 2023, respectively. Although the timing and outcome of income tax audit settlements are uncertain, it is expected that a $3,194 reduction of the liability for uncertain tax benefits will occur in the next 12 months. The settlement of these unrecognized tax benefits could result in earnings from $0 to $2,562. |
Contingencies
Contingencies | 9 Months Ended |
Dec. 24, 2023 | |
Loss Contingency [Abstract] | |
Contingencies | Contingencies We lease certain warehouse, distribution and office facilities, vehicles, and office equipment under operating leases. These operating lease liabilities represent commitments for minimum lease payments under non-cancelable operating leases in the amount of $163,707. See Note 3, Leases . Litigation From time-to-time, we are subject to various legal proceedings, including lawsuits, which arise out of, and are incidental to, the conduct of our business. We do not consider any of such proceedings that are currently pending, individually or in the aggregate, to be material to our business or likely to result in a material adverse effect on our operating results, financial position, or cash flows. Environmental liabilities Our operations and ownership or use of real property are subject to a number of federal, state, and local environmental laws and regulations, as well as applicable foreign laws and regulations, including those governing the discharge of hazardous materials, remediation of contaminated sites, and restoration of damage to the environment. We are obligated to conduct investigation and/or remediation activities at certain sites that we own or operate or formerly owned or operated. Certain of our former subsidiaries have been identified as a potentially responsible party ("PRPs" or "PRP"), along with other parties, in regulatory agency actions associated with hazardous waste sites. As a PRP, those former subsidiaries may be required to pay a share of the costs of the investigation and clean-up of these sites. In that event, we would be obligated to indemnify those subsidiaries for those costs. While uncertainties exist with respect to the amounts and timing of the ultimate environmental liabilities, based on currently available information, we have concluded that these matters, individually or in the aggregate, will not have a material adverse effect on our operating results, financial position, or cash flows. We have recorded a liability for environmental remediation of $656 and $717 as of December 24, 2023 and March 31, 2023, respectively. |
Operating Segment Information
Operating Segment Information | 9 Months Ended |
Dec. 25, 2022 | |
Segment Reporting [Abstract] | |
Operating Segment Information | Operating Segment Information As of December 24, 2023, we have eight operating segments, which have been aggregated into two reportable segments, The Kinetic Group and Revelyst. Segment reporting is based upon the “management approach,” i.e., how we organize operating segments for which separate financial information is (1) available and (2) evaluated regularly by the Chief Operating Decision Maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Our Chief Operating Decision Makers (CODMs) are our two Co-Chief Executive Officers. During the third fiscal quarter of 2024, we changed the names of our reportable segments. The segment name changes did not result in any change to the compositions of our reportable segments and therefore did not result in any change to historical results. Our Ammunition operating segment, which is its own reportable segment, was renamed from Sporting Products to The Kinetic Group. The formerly named Outdoor Products reportable segment is now referred to as Revelyst. We aggregate our Outdoor Accessories, Sports Protection, Outdoor Cooking, Hydration, Golf, Fishing, and Cycling operating segments into the Revelyst reportable segment. The operating segments aggregating into our Revelyst reportable segment rely primarily on international suppliers to manufacture the products they sell, which impacts their economic characteristics in a similar manner. These operating segments also share other commonalities or risks, such as technology or intellectual property sharing, commonly regulated environments, similar input cost risks, and nature of their products. Consumers of the products in these operating segments are typically looking to upgrade or replace their products in a similar time frame. Our CODMs relies on internal management reporting that analyzes our segment's operating income. Certain corporate-related costs and other non-recurring costs are not allocated to the segments in order to present comparable results from period to period and are not utilized by management in determining segment profitability. As segment assets are not reported to or used by the CODMs to measure business performance or allocate resources, total segment assets are not presented below. The Kinetic Group and Revelyst reportable segments generated approximately 53% and 47%, respectively, of our external sales in the nine months ended December 24, 2023. No single customer contributed more than 10% of our sales in the nine months ended December 24, 2023 and December 25, 2022. The following tables contain information utilized by management to evaluate our operating segments for the periods presented: Three months ended December 24, 2023 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 364,949 $ 317,304 $ 682,253 $ — $ 682,253 Gross profit 118,111 84,740 202,851 — 202,851 Operating income (loss) $ 95,347 $ (2,853) $ 92,494 $ (272,543) $ (180,049) Other income, net — — — 86 86 Interest expense, net — — — (15,227) (15,227) Income (loss) before income taxes $ 95,347 $ (2,853) $ 92,494 $ (287,684) $ (195,190) Depreciation and amortization $ 6,491 $ 17,573 $ 24,064 $ 937 $ 25,001 Nine months ended December 24, 2023 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 1,091,041 $ 961,353 $ 2,052,394 $ — $ 2,052,394 Gross profit 365,253 273,225 638,478 — 638,478 Operating income (loss) $ 296,159 $ 16,525 $ 312,684 $ (324,762) $ (12,078) Other expense, net — — — (1,629) (1,629) Interest expense, net — — — (48,088) (48,088) Income (loss) before income taxes $ 296,159 $ 16,525 $ 312,684 $ (374,479) $ (61,795) Depreciation and amortization $ 19,348 $ 52,625 $ 71,973 $ 2,834 $ 74,807 Three months ended December 25, 2022 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 401,504 $ 353,271 $ 754,775 $ — $ 754,775 Gross Profit 141,459 102,396 243,855 (5,049) 238,806 Operating income (loss) $ 117,935 $ 13,475 $ 131,410 $ (34,724) $ 96,686 Other income, net — — — 639 639 Interest expense, net — — — (18,953) (18,953) Income (loss) before income taxes $ 117,935 $ 13,475 $ 131,410 $ (53,038) $ 78,372 Depreciation and amortization $ 6,171 $ 17,598 $ 23,769 $ 1,022 $ 24,791 Nine months ended December 25, 2022 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 1,344,620 $ 994,445 $ 2,339,065 $ — $ 2,339,065 Gross Profit 501,558 301,675 803,233 (8,083) 795,150 Operating (loss) income $ 427,573 $ 70,891 $ 498,464 $ (98,186) $ 400,278 Other income, net — — — 1,380 1,380 Interest expense, net — — — (39,197) (39,197) Income (loss) before income taxes $ 427,573 $ 70,891 $ 498,464 $ (136,003) $ 362,461 Depreciation and amortization $ 18,951 $ 44,948 $ 63,899 $ 3,192 $ 67,091 (a) includes corporate general and administrative expenses of $49,180 and $101,734 for the three and nine months ended December 24, 2023 and $21,167 and $62,574 for the three and nine months ended December 25, 2022, respectively, plus other non-recurring costs that are not allocated to the segments in order to present comparable results as presented to the CODMs. Reconciling items for the three and nine months ended December 24, 2023 included impairment of goodwill and intangibles of $218,812, post-acquisition compensation expense of $1,405 and $4,216 and contingent consideration fair value adjustment of $3,146, respectively. Reconciling items for the three and nine months ended December 25, 2022 included post-acquisition compensation expense of $3,530 and $11,130, inventory fair value step-up expenses related to the Fox Racing and Simms acquisitions of $5,049 and $8,079, and contingent consideration fair value adjustment of $4,978 and $16,403, respectively. Sales, net, exclude all intercompany sales between The Kinetic Group and Revelyst, which were not material for the three and nine months ended December 24, 2023 and December 25, 2022. |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 24, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Policies) | 9 Months Ended |
Dec. 24, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation —Our unaudited condensed consolidated financial statements have been prepared in accordance with the requirements of the Securities and Exchange Commission ("SEC") for interim reporting. As permitted under those rules, certain disclosures and other financial information that normally are required by accounting principles generally accepted in the United States have been condensed or omitted. Management is responsible for the unaudited condensed consolidated financial statements included in this report, which in the opinion of management, include all adjustments necessary for a fair presentation of our financial position, results of operations, and cash flows for the periods and dates presented. These unaudited condensed consolidated financial statements should be read in conjunction with our consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2023 (“fiscal year 2023”), which was filed with the SEC on May 25, 2023. |
Change In Presentation | Change in Presentation —In connection with our preparation of the condensed consolidated financial statements for the three and nine months ended December 24, 2023, we changed the presentation of "Earnings (loss) before interest, income taxes, and other" to "Operating income (loss)" within the condensed consolidated statements of comprehensive income (loss). This correction did not affect previously reported net income (loss) and is immaterial to the previously issued financial statements. |
Use of Estimates | Use of Estimates |
New Accounting Pronouncements and Accounting Standards Adopted During this Fiscal Year | New Accounting Pronouncements —Our accounting policies are described in Note 1 of the audited consolidated financial statements in our Annual Report on Form 10-K for fiscal year 2023, which was filed with the SEC on May 25, 2023. Such significant accounting policies are applicable for periods prior to the following new accounting standards. In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, “ Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures .” This ASU improves financial reporting by requiring disclosure of incremental segment information. The new guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. We are currently evaluating the impact of adopting this ASU 2023-07 on our consolidated financial statements and disclosures. In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which improves the transparency of income tax disclosures by requiring companies to (1) disclose consistent categories and greater disaggregation of information in the effective rate reconciliation and (2) provide information on income taxes paid disaggregated by jurisdiction. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024, although early adoption is permitted. The guidance should be applied on a prospective basis with the option to apply the standard retrospectively. We are currently evaluating the impact of adopting this ASU 2023-09 on our consolidated financial statements and disclosures. Accounting Standards Adopted During this Fiscal Year —In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, which requires a buyer in a supplier finance program to disclose qualitative and quantitative information about its program to allow a user of the financial statements to understand the program’s nature, activity during the period, changes from period to period, and potential magnitude. The amendments in ASU 2022-04 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with the exception for the amendment on roll-forward information, which is effective for fiscal years beginning after December 15, 2023. The guidance should be applied retrospectively, except for the amendment on roll-forward information, which should be applied prospectively. This ASU was effective for us in the first quarter of fiscal year 2024, with the exception of the amendment on roll-forward information, which will be effective for us in our Form 10-K for fiscal year 2025. We adopted this ASU during the first quarter of fiscal 2024 and the adoption did not have an impact on our condensed consolidated financial statement disclosures. |
Goodwill | Goodwill —Our policy is to test goodwill for impairment on the first day of the fourth fiscal quarter or upon the occurrence of events or changes in circumstances that indicate that the asset might be impaired. Goodwill is assigned to our reporting units, which are our operating segments, or components of an operating segment, that constitute a business for which discrete financial information is available, and for which segment management regularly reviews the operating results. During the third quarter of fiscal year 2024, as a result of an increasingly challenging economic environment for consumers due to higher interest rate expectations continuing, and other factors affecting the market for our products, we reduced our projections for fiscal year 2024 and beyond for the majority of our reporting units within the Revelyst reportable segment. As a result of a downward revision of forecasted cash flows due to lower volume and profitability expectations, combined with the decline in our stock price in the third fiscal quarter, we concluded that triggering events had occurred potentially indicating that the fair values of certain reporting units within our Revelyst reportable segment were less than their carrying values. Based on these events, we completed an interim quantitative goodwill impairment analysis and recognized goodwill impairment losses of $161,714 related to reporting units within our Revelyst reportable segment, which are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. See Note 11, Goodwill and Intangible Assets , for further information. For the third quarter fiscal year 2024 interim quantitative goodwill impairment analysis, we determined the estimated fair value of each reporting unit and compared it to their respective carrying amounts, including goodwill. The fair value of each reporting unit was determined considering both an income and market approach. We weighted the valuations of our Revelyst segment reporting units using 100% of the income approach, specifically the discounted cash flow method. The weighted average cost of capital used in the income approach ranged between 12.5% and 16.0%, which was derived from the financial structures of comparable companies corresponding to the industry of each reporting unit. We weighted the value of The Kinetic Group reporting unit using 100% of the market approach, based on the offer accepted in the Sporting Products Sale. This market approach method estimates the price reasonably expected to be realized. See Sale of Sporting Products and Planned Separation in the Executive Summary and Financial Highlights of Part I, Item 2 of this Quarterly Report on Form 10-Q for further discussion of the Sporting Products Sale. In developing the discounted cash flow analysis, our assumptions about forecasted revenues and operating margins, capital expenditures, and changes in working capital were based on forecasts, as reviewed by the Board of Directors, and assume a terminal growth rate thereafter. A separate discount rate was determined for each Revelyst reporting unit and these cash flows were then discounted to determine the fair value of the reporting unit. The discounted cash flow analysis is derived from valuation techniques in which one or more significant inputs are not observable (Level 3 fair value measurements). In order to assess the reasonableness of the calculated fair values of our reporting units, we also compared the sum of the reporting units’ fair values to our market capitalization and calculated an implied control premium (the excess of the sum of the reporting units’ fair values over the market capitalization). We evaluated the control premium by comparing it to control premiums of recent comparable transactions. If the implied control premium was not reasonable in light of this assessment, we would have reevaluated our fair value estimates of the reporting units by adjusting the discount rates and other assumptions as necessary. |
Indefinite-Lived Intangible Assets | Indefinite-Lived Intangible Assets —Indefinite lived intangibles are not amortized and are tested for impairment annually on the first day of the fourth fiscal quarter or upon the occurrence of events or changes in circumstances that indicate that the assets might be impaired. In conjunction with our interim quantitative goodwill impairment analysis, we performed a fair value analysis on our indefinite-lived trademarks and trade names within the Revelyst reportable segment, which resulted in impairment losses of $50,300, related to indefinite lived intangible assets. These losses are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. We performed a step zero analysis on The Kinetic Group indefinite-lived trade names. See Note 11, Goodwill and Intangible Assets , for further information. We calculated the fair value of our indefinite lived intangibles using the relief-from-royalty method which assumes that the asset has value to the extent that the owner is relieved of the obligation to pay royalties for the benefits received from them. We estimated the future revenue for the related brands and technology, the appropriate royalty rate, and the weighted average cost of capital. We based our fair values and estimates on assumptions we believed to be reasonable, but which are unpredictable and inherently uncertain. Our assumptions used to develop the discounted cash flow analysis and the relief-from-royalty calculation require us to make significant estimates. The projections also take into account several factors including current and estimated economic trends and outlook, costs of raw materials and other factors that are beyond our control. If the current economic conditions were to deteriorate, or if we were to lose significant business, it is possible that the estimated fair value of certain reporting units or trade names could fall below their carrying value resulting in the necessity to conduct additional impairment tests in future periods. We continually monitor the reporting units and trade names for impairment indicators and update assumptions used in the most recent calculation of the estimated fair value of a reporting unit or trade names as appropriate. |
Long-Lived Assets | Long-Lived Assets —Our long-lived assets consist primarily of property, plant, and equipment, amortizing right-of-use assets related to our operating leases and amortizing costs related to cloud computing arrangements. Our primary identifiable intangible assets include trademarks and trade names, patented technology, and customer relationships. We periodically evaluate the recoverability of the carrying amount of our long-lived assets whenever events or changes in circumstances indicate that the carrying amount of the asset may not be fully recoverable or exceeds its fair value. In conjunction with our interim quantitative goodwill impairment analysis, we performed recoverability tests of our long-lived assets, including amortizing intangible assets, by comparing the net book value of our long-lived assets or asset groups, to the future undiscounted net cash flows attributable to such assets. Based on the results of the recoverability test, we determined that the fair value of certain definite lived intangibles related to trade names and customer relationship within our Outdoor Cooking reporting unit were less than their carrying value. The fair value of these intangibles was determined using the cost approach. As a result, we recorded impairment charges totaling $6,798 related to amortizing intangible assets, which are included in "Impairment of goodwill and intangibles" on our condensed consolidated statements of comprehensive income (loss) for the three and nine months ended December 24, 2023. See Note 11, Goodwill and Intangible Assets , for further information. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Long-Term Contingent Consideration Liability | Contingent consideration liabilities are reported under the following captions in the condensed consolidated balance sheets: December 24, 2023 March 31, 2023 Other current liabilities $ 11,750 $ 8,586 Other long-term liabilities 3,085 11,688 Total $ 14,835 $ 20,274 Following is a summary of our contingent consideration liability Level 3 activity during fiscal year 2024: Balance, March 31, 2023 $ 20,274 Increase in fair value 3,146 Payments made (8,585) Balance, December 24, 2023 $ 14,835 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The table below discloses information about carrying values and estimated fair value relating to our financial assets and liabilities: December 24, 2023 March 31, 2023 Carrying Fair Carrying Fair Fixed-rate debt (1) $ 500,000 $ 488,000 $ 500,000 $ 404,000 Variable-rate debt (2) 335,000 335,000 560,000 560,000 (1) Fixed rate debt —In fiscal year 2021, we issued $500,000 aggregate principal amount o f 4.5% S enior Notes which will mature on March 15, 2029. These notes are unsecured and senior obligations. The fair value of the fixed-rate debt is based on market quotes for each issuance. We consider these to be Level 2 instruments. See Note 12, Long-term Debt, for additional information on long-term debt, including certain risks and uncertainties. (2) Variable rate debt —The carrying value of the amounts outstanding under our 2022 ABL Revolving Credit Facility and 2022 Term Loan approximates the fair value because the interest rates are variable and reflective of market rates as of December 24, 2023. The fair value of this debt is categorized within Level 2 of the fair value hierarchy based on the observable market borrowing rates. See Note 12, Long-term Debt, for additional information on our credit facilities, including certain risks and uncertainties. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Leases [Abstract] | |
Schedule of operating lease assets and liabilities | The amounts of assets and liabilities related to our operating leases were as follows: Balance sheet caption December 24, 2023 March 31, 2023 Assets: Operating lease assets Operating lease assets $ 95,906 $ 106,828 Liabilities: Current: Operating lease liabilities Other current liabilities $ 14,316 $ 16,351 Long-term: Operating lease liabilities Long-term operating lease liabilities 95,429 103,313 Total lease liabilities $ 109,745 $ 119,664 |
Schedule of lease cost and supplemental cash flow information | The components of lease expense are recorded to cost of sales and selling, general, and administrative expenses in the condensed consolidated statements of comprehensive income (loss). The components of lease expense were as follows: Three months ended Nine months ended December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Fixed operating lease costs (1) $ 6,757 $ 7,406 $ 21,026 $ 20,300 Variable operating lease costs 1,208 522 3,453 1,980 Operating and sub-lease income (262) (157) (692) (464) Net lease costs $ 7,703 $ 7,771 $ 23,787 $ 21,816 (1) Includes short-term leases, which are immaterial. The weighted average remaining lease term and weighted average discount rate is as follows: December 24, 2023 March 31, 2023 Weighted average remaining lease term (years): Operating leases 9.34 9.71 Weighted average discount rate: Operating leases 8.52 % 8.43 % Supplemental cash flow information related to leases is as follows: Nine months ended December 24, 2023 December 25, 2022 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows - operating leases $ 20,239 $ 16,623 Operating lease assets obtained in exchange for lease liabilities: Operating leases 7,498 33,228 ROU asset re-measurements (6,105) 40 |
Schedule of future minimum lease payments | The approximate minimum lease payments under non-cancelable operating leases as of December 24, 2023 are as follows: Remainder of fiscal year 2024 $ 6,546 Fiscal year 2025 21,412 Fiscal year 2026 19,562 Fiscal year 2027 17,041 Fiscal year 2028 14,683 Thereafter 84,463 Total lease payments 163,707 Less imputed interest (53,962) Present value of lease liabilities $ 109,745 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Pro Forma Financial Information | The following unaudited pro forma financial information presents our results as if the Fox Racing acquisition had occurred on April 1, 2021: Three months ended December 25, 2022 Nine months ended December 25, 2022 Sales, net $ 754,775 $ 2,444,920 Net income 68,075 286,732 The unaudited supplemental pro forma data above includes the following significant non-recurring adjustments to net income to account for certain costs which would have been incurred if the Fox Racing acquisition had been completed on April 1, 2021: Three months ended December 25, 2022 Nine months ended December 25, 2022 Fees for advisory, legal, and accounting services (1) $ (99) $ (6,064) Inventory step-up, net (2) (3,772) (6,287) Interest (3) — 10,627 Depreciation (4) — 719 Amortization (5) — 4,245 Management Fees (6) — (530) Income tax provision (benefit) (7) 943 (1,199) (1) During the three months and nine months ended December 25, 2022, we incurred a total of $99 and $6,064 in acquisition related costs, including legal and other professional fees, all of which were reported in selling, general, and administrative expense in the condensed consolidated statements of comprehensive income (loss). This adjustment is to show the results as if those fees were incurred during the first quarter of fiscal year 2022. (2) Adjustment reflects the increased cost of goods sold expense resulting from the fair value step-up in inventory, which was expensed over inventory turns. (3) Adjustment for the estimated interest expense and debt issuance amortization expense on $580,000 in borrowings from Vista's 2022 ABL Revolving Credit Facility and 2022 Term Loan, used to finance the acquisition of Fox Racing. The interest rate assumed for purposes of preparing this pro forma financial information is 5.58%. This rate is the weighted average interest rate for our borrowings under the 2022 ABL Revolving Credit Facility and 2022 Term Loan during the quarter of the acquisition. (4) Adjustment for depreciation related to the revised fair-value basis of the acquired property, plant and equipment and change in estimated useful lives. (5) Adjustment for amortization of acquired intangible assets. (6) Represents an adjustment for management fees historically charged by the previous owner of Fox Racing under the terms of their management agreement. (7) Income tax effect of the adjustments made at a blended federal, state, and international statutory rate adjusted for any non-deductible acquisition costs. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Interest Rate Derivatives | As of December 24, 2023, we had the following interest rate swaps outstanding: Notional Fair Value Pay Fixed Receive Floating Maturity Date Non-amortizing swap $ 50,000 $ (499) 4.910% 5.378% Feb 2026 Non-amortizing swap 25,000 (352) 4.650% 5.345% Mar 2026 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The following table summarizes the fair value of our derivative instruments as well as the location of the asset and/or liability on the condensed consolidated balance sheets as of December 24, 2023 and consolidated balance sheets as of March 31, 2023: Asset derivatives Derivatives not designated as hedging instruments Balance sheet location December 24, 2023 March 31, 2023 Foreign currency forward contracts Other current assets $ — $ 91 Total $ — $ 91 Liability derivatives Derivatives designated as cash flow hedging instruments Balance sheet location December 24, 2023 March 31, 2023 Foreign currency forward contracts Other current liabilities $ 69 $ 3,252 Interest rate swap contract Other long-term liabilities 851 1,760 Total $ 920 $ 5,012 |
Derivative Instruments, Gain (Loss) | The following tables summarize the net effect of all cash flow hedges for each of our derivative contracts on the condensed consolidated financial statements for the three and the nine months ended December 24, 2023 and December 25, 2022, respectively: Gain (loss) recognized in other comprehensive income Three months ended Nine months ended Derivatives designated as cash flow hedging instruments: December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Foreign currency forward contracts $ (100) $ (2,920) $ 142 $ (2,920) Lead forward contracts (123) 2,335 153 1,305 Interest rate swap contracts (1,123) — 1,269 — Total gain (loss) $ (1,346) $ (585) $ 1,564 $ (1,615) Gain (loss) reclassified from other comprehensive income into earnings Three months ended Nine months ended Derivatives designated as cash flow hedging instruments: Location December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Foreign currency forward contracts Cost of sales $ (160) $ — $ (1,349) $ — Foreign currency forward contracts Other income (expense), net (417) — (1,634) — Lead forward contracts Cost of sales 141 94 431 123 Interest rate swap contracts Interest expense, net 156 — 360 — Total gain (loss) $ (280) $ 94 $ (2,192) $ 123 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following tables disaggregate our net sales by major product category: Three months ended December 24, 2023 December 25, 2022 The Kinetic Group Revelyst Total The Kinetic Group Revelyst Total Sporting Products (1) $ 364,949 $ — $ 364,949 $ 401,504 $ — $ 401,504 Outdoor Accessories (2) — 74,648 74,648 — 79,623 79,623 Action Sports (3) — 111,778 111,778 — 132,322 132,322 Outdoor Recreation (4) — 130,878 130,878 — 141,326 141,326 Total $ 364,949 $ 317,304 $ 682,253 $ 401,504 $ 353,271 $ 754,775 Geographic Region: United States $ 330,556 $ 248,273 $ 578,829 $ 367,056 $ 261,090 $ 628,146 Rest of the world 34,393 69,031 103,424 34,448 92,181 126,629 Total $ 364,949 $ 317,304 $ 682,253 $ 401,504 $ 353,271 $ 754,775 Nine months ended December 24, 2023 December 25, 2022 The Kinetic Group Revelyst Total The Kinetic Group Revelyst Total Sporting Products (1) $ 1,091,041 $ — $ 1,091,041 $ 1,344,620 $ — $ 1,344,620 Outdoor Accessories (2) — 188,700 188,700 — 221,704 221,704 Action Sports (3) — 367,076 367,076 — 373,139 373,139 Outdoor Recreation (4) — 405,577 405,577 — 399,602 399,602 Total $ 1,091,041 $ 961,353 $ 2,052,394 $ 1,344,620 $ 994,445 $ 2,339,065 Geographic Region: United States $ 985,321 $ 719,000 $ 1,704,321 $ 1,244,437 $ 693,305 $ 1,937,742 Rest of the world 105,720 242,353 348,073 100,183 301,140 401,323 Total $ 1,091,041 $ 961,353 $ 2,052,394 $ 1,344,620 $ 994,445 $ 2,339,065 (1) Sporting Products includes the Ammunition operating segment. (2) Outdoor Accessories includes the Outdoor Accessories operating segment. (3) Action Sports includes the operating segments: Sports Protection and Cycling. (4) Outdoor Recreation includes the operating segments: Hydration, Outdoor Cooking, Golf, Fishing, and our Stone Glacier business. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | In computing EPS for the periods presented, earnings, as reported for each respective period, is divided by the number of shares below: Three months ended Nine months ended (Amounts in thousands except per share data) December 24, 2023 December 25, 2022 December 24, 2023 December 25, 2022 Numerator: Net income (loss) $ (148,195) $ 65,147 $ (45,673) $ 284,617 Denominator: Weighted-average number of common shares outstanding basic: 58,078 56,574 57,866 56,538 Dilutive effect of share-based awards (1) — 1,269 — 1,484 Diluted shares 58,078 57,843 57,866 58,022 Earnings (loss) per common share: Basic $ (2.55) $ 1.15 $ (0.79) $ 5.03 Diluted $ (2.55) $ 1.13 $ (0.79) $ 4.91 (1) Due to the loss from continuing operations for the three and nine months ended December 24, 2023, there are no common shares added to calculate dilutive EPS because the effect would be anti-dilutive. Potentially dilutive securities of 300 were excluded from diluted EPS in three and nine months ended December 24, 2023, as we had a net loss. Potentially dilutive securities, which were not included in the computation of diluted earnings per share, because either the effect would have been anti-dilutive, or the options’ exercise prices were greater than the average market price of the common stock were 23 and 316 for the three and nine months ended December 25, 2022, respectively. |
Receivables (Tables)
Receivables (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Receivables [Abstract] | |
Schedule of accounts, notes, loans and financing receivable | Net receivables are summarized as follows: December 24, 2023 March 31, 2023 Trade receivables $ 377,943 $ 349,424 Other receivables 16,095 8,899 Less: allowance for estimated credit losses and discounts (20,028) (18,950) Net receivables $ 374,010 $ 339,373 |
Schedule of reconciliation of activity related to the allowance for estimated credit losses and discounts | The following provides a reconciliation of the activity related to the allowance for estimated credit losses for the nine months ended December 24, 2023: Balance, March 31, 2023 $ 18,950 Provision for credit losses 2,228 Write-off of uncollectible amounts, net of recoveries (1,150) Balance, December 24, 2023 $ 20,028 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory, Current | Current net inventories consist of the following: December 24, 2023 March 31, 2023 Raw materials $ 198,497 $ 199,225 Work in process 66,899 63,652 Finished goods 389,443 447,020 Net inventories $ 654,839 $ 709,897 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (AOCL) (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Equity [Abstract] | |
Schedule of components of AOCL, net of income taxes | The components of AOCL, net of income taxes, are as follows: December 24, 2023 March 31, 2023 Derivatives $ (683) $ (3,543) Pension and other postretirement benefits liabilities (69,763) (71,449) Cumulative translation adjustment (4,885) (5,810) Total AOCL $ (75,331) $ (80,802) |
Schedule of changes in balance of AOCL, net of income taxes | The following tables detail the amounts reclassified from AOCL to earnings as well as the changes in derivatives, pension and other postretirement benefits, and foreign currency translation: Three months ended December 24, 2023 Nine months ended December 24, 2023 Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Beginning balance in AOCL $ 129 $ (70,325) $ (5,839) $ (76,035) $ (3,543) $ (71,449) $ (5,810) $ (80,802) Change in fair value of derivatives (1,346) — — (1,346) 1,564 — — 1,564 Income tax impact on derivative instruments 254 — — 254 (896) — — (896) Net losses reclassified from AOCL 280 — — 280 2,192 — — 2,192 Net actuarial losses reclassified from AOCL (1) — 562 — 562 — 1,686 — 1,686 Net change in cumulative translation adjustment — — 954 954 — — 925 925 Ending balance in AOCL $ (683) $ (69,763) $ (4,885) $ (75,331) $ (683) $ (69,763) $ (4,885) $ (75,331) (1) Amounts related to our pension and other postretirement benefits that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented, net of tax. Three months ended December 25, 2022 Nine months ended December 25, 2022 Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Derivatives Pension and other postretirement benefits liabilities Cumulative translation adjustment Total Beginning balance in AOCL $ (634) $ (69,687) $ (7,119) $ (77,440) $ (356) $ (71,075) $ (5,248) $ (76,679) Change in fair value of derivatives (585) — — (585) (1,615) — — (1,615) Income tax impact on derivative instruments 164 — — 164 945 — — 945 Net gains reclassified from AOCL (94) — — (94) (123) — — (123) Net actuarial losses reclassified from AOCL (1) — 694 — 694 — 2,082 — 2,082 Net change in cumulative translation adjustment — — 994 994 — — (877) (877) Ending balance in AOCL $ (1,149) $ (68,993) $ (6,125) $ (76,267) $ (1,149) $ (68,993) $ (6,125) $ (76,267) (1) Amounts related to our pension and other postretirement benefits that were reclassified from AOCL were recorded as a component of net periodic benefit cost for each period presented. See Note 13, Employee Benefit Plans . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in the carrying amount of goodwill by segment | The carrying value of goodwill by reportable segment was as follows: The Kinetic Group Revelyst Total Balance, March 31, 2023 $ 86,105 $ 379,604 $ 465,709 Impairment — (161,714) (161,714) Balance, December 24, 2023 $ 86,105 $ 217,890 $ 303,995 |
Schedule of net intangibles | Intangible assets by major asset class consisted of the following: December 24, 2023 March 31, 2023 Gross Accumulated Total Gross Accumulated Total Trade names $ 112,686 $ (35,902) $ 76,784 $ 113,915 $ (30,848) $ 83,067 Patented technology 36,854 (18,515) 18,339 36,854 (16,313) 20,541 Customer relationships and other 523,192 (180,320) 342,872 530,237 (151,272) 378,965 Total 672,732 (234,737) 437,995 681,006 (198,433) 482,573 Non-amortizing trade names 200,303 — 200,303 250,603 — 250,603 Net intangible assets $ 873,035 $ (234,737) $ 638,298 $ 931,609 $ (198,433) $ 733,176 |
Schedule of net intangibles | Intangible assets by major asset class consisted of the following: December 24, 2023 March 31, 2023 Gross Accumulated Total Gross Accumulated Total Trade names $ 112,686 $ (35,902) $ 76,784 $ 113,915 $ (30,848) $ 83,067 Patented technology 36,854 (18,515) 18,339 36,854 (16,313) 20,541 Customer relationships and other 523,192 (180,320) 342,872 530,237 (151,272) 378,965 Total 672,732 (234,737) 437,995 681,006 (198,433) 482,573 Non-amortizing trade names 200,303 — 200,303 250,603 — 250,603 Net intangible assets $ 873,035 $ (234,737) $ 638,298 $ 931,609 $ (198,433) $ 733,176 |
Schedule of expected future amortization expense | As of December 24, 2023, we expect amortization expense related to these assets to be as follows: Remainder of fiscal year 2024 $ 12,441 Fiscal year 2025 49,746 Fiscal year 2026 46,736 Fiscal year 2027 45,286 Fiscal year 2028 40,116 Thereafter 243,670 Total $ 437,995 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Dec. 24, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt, including the current portion | Long-term debt consisted of the following: December 24, 2023 March 31, 2023 2022 ABL Revolving Credit Facility $ 270,000 $ 355,000 2022 Term Loan 65,000 205,000 Total Principal Amount of Credit Agreements 335,000 560,000 4.5% Senior Notes 500,000 500,000 Total Principal Amount of Long-Term Debt 835,000 1,060,000 Less: unamortized deferred financing costs related to term loans (6,014) (10,342) Carrying amount of long-term debt 828,986 1,049,658 Less: current portion (65,000) (65,000) Carrying amount of long-term debt, excluding current portion $ 763,986 $ 984,658 |
Operating Segment Information (
Operating Segment Information (Tables) | 9 Months Ended |
Dec. 25, 2022 | |
Segment Reporting [Abstract] | |
Summary Results by Segment | The following tables contain information utilized by management to evaluate our operating segments for the periods presented: Three months ended December 24, 2023 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 364,949 $ 317,304 $ 682,253 $ — $ 682,253 Gross profit 118,111 84,740 202,851 — 202,851 Operating income (loss) $ 95,347 $ (2,853) $ 92,494 $ (272,543) $ (180,049) Other income, net — — — 86 86 Interest expense, net — — — (15,227) (15,227) Income (loss) before income taxes $ 95,347 $ (2,853) $ 92,494 $ (287,684) $ (195,190) Depreciation and amortization $ 6,491 $ 17,573 $ 24,064 $ 937 $ 25,001 Nine months ended December 24, 2023 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 1,091,041 $ 961,353 $ 2,052,394 $ — $ 2,052,394 Gross profit 365,253 273,225 638,478 — 638,478 Operating income (loss) $ 296,159 $ 16,525 $ 312,684 $ (324,762) $ (12,078) Other expense, net — — — (1,629) (1,629) Interest expense, net — — — (48,088) (48,088) Income (loss) before income taxes $ 296,159 $ 16,525 $ 312,684 $ (374,479) $ (61,795) Depreciation and amortization $ 19,348 $ 52,625 $ 71,973 $ 2,834 $ 74,807 Three months ended December 25, 2022 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 401,504 $ 353,271 $ 754,775 $ — $ 754,775 Gross Profit 141,459 102,396 243,855 (5,049) 238,806 Operating income (loss) $ 117,935 $ 13,475 $ 131,410 $ (34,724) $ 96,686 Other income, net — — — 639 639 Interest expense, net — — — (18,953) (18,953) Income (loss) before income taxes $ 117,935 $ 13,475 $ 131,410 $ (53,038) $ 78,372 Depreciation and amortization $ 6,171 $ 17,598 $ 23,769 $ 1,022 $ 24,791 Nine months ended December 25, 2022 The Kinetic Group Revelyst Reportable segments total Corporate and other reconciling items (a) Consolidated total Sales, net $ 1,344,620 $ 994,445 $ 2,339,065 $ — $ 2,339,065 Gross Profit 501,558 301,675 803,233 (8,083) 795,150 Operating (loss) income $ 427,573 $ 70,891 $ 498,464 $ (98,186) $ 400,278 Other income, net — — — 1,380 1,380 Interest expense, net — — — (39,197) (39,197) Income (loss) before income taxes $ 427,573 $ 70,891 $ 498,464 $ (136,003) $ 362,461 Depreciation and amortization $ 18,951 $ 44,948 $ 63,899 $ 3,192 $ 67,091 (a) includes corporate general and administrative expenses of $49,180 and $101,734 for the three and nine months ended December 24, 2023 and $21,167 and $62,574 for the three and nine months ended December 25, 2022, respectively, plus other non-recurring costs that are not allocated to the segments in order to present comparable results as presented to the CODMs. Reconciling items for the three and nine months ended December 24, 2023 included impairment of goodwill and intangibles of $218,812, post-acquisition compensation expense of $1,405 and $4,216 and contingent consideration fair value adjustment of $3,146, respectively. Reconciling items for the three and nine months ended December 25, 2022 included post-acquisition compensation expense of $3,530 and $11,130, inventory fair value step-up expenses related to the Fox Racing and Simms acquisitions of $5,049 and $8,079, and contingent consideration fair value adjustment of $4,978 and $16,403, respectively. |
The Company and Basis of Pres_3
The Company and Basis of Presentation (Details) $ in Thousands | 9 Months Ended |
Dec. 24, 2023 USD ($) numberOfCountriesWithSalesCustomers reportable_segment | |
Accounting Policies [Line Items] | |
Number of reportable segments | reportable_segment | 2 |
Number of countries in which Entity operates | numberOfCountriesWithSalesCustomers | 100 |
Goodwill impairment losses | $ (161,714) |
Amortizing intangible assets, impairment charges | $ (6,798) |
Minimum | |
Accounting Policies [Line Items] | |
Weighted average cost of capital (in percent) | 0.125 |
Maximum | |
Accounting Policies [Line Items] | |
Weighted average cost of capital (in percent) | 0.160 |
Revelyst | |
Accounting Policies [Line Items] | |
Goodwill impairment losses | $ (161,714) |
Indefinite-lived intangible assets, impairment losses | $ (50,300) |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Narrative) (Details) $ in Thousands | Dec. 24, 2023 USD ($) |
QuietKat | |
Fair value of assets and liabilities | |
Contingent consideration payable | $ 8,915 |
Stone Glacier | |
Fair value of assets and liabilities | |
Contingent consideration payable | 5,920 |
Fox Racing | |
Fair value of assets and liabilities | |
Contingent consideration payable | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments (Contingent Consideration Liability) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 24, 2023 | Dec. 25, 2022 | |
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||
Increase in fair value | $ 3,146 | $ (16,403) |
Payments made | (8,585) | $ 0 |
Fair Value, Inputs, Level 3 | Fair Value, Recurring | ||
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||
Balance, beginning of period | 20,274 | |
Increase in fair value | 3,146 | |
Payments made | (8,585) | |
Balance, end of period | 14,835 | |
Other current liabilities | Fair Value, Inputs, Level 3 | Fair Value, Recurring | ||
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||
Balance, beginning of period | 8,586 | |
Balance, end of period | 11,750 | |
Other long-term liabilities | Fair Value, Inputs, Level 3 | Fair Value, Recurring | ||
Business Combination, Contingent Consideration, Liability [Roll Forward] | ||
Balance, beginning of period | 11,688 | |
Balance, end of period | $ 3,085 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments (Fair Value of Financial Instruments) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Fair value of assets and liabilities | ||
Carrying amount of long-term debt | $ 828,986 | $ 1,049,658 |
Senior Notes, 4.5% | ||
Fair value of assets and liabilities | ||
Carrying amount of long-term debt | $ 500,000 | |
Long-term debt, percentage bearing fixed interest, percentage rate | 4.50% | |
Senior Notes, 4.5% | Carrying amount | Fair Value, Recurring | ||
Fair value of assets and liabilities | ||
Fixed-rate debt | 500,000 | $ 500,000 |
Senior Notes, 4.5% | Fair value | Fair Value, Recurring | ||
Fair value of assets and liabilities | ||
Fixed-rate debt | 488,000 | 404,000 |
2022 ABL Revolving Credit Facility and 2022 Term Loan Facility | Carrying amount | Fair Value, Recurring | ||
Fair value of assets and liabilities | ||
Variable-rate debt | 335,000 | 560,000 |
2022 ABL Revolving Credit Facility and 2022 Term Loan Facility | Fair value | Fair Value, Recurring | ||
Fair value of assets and liabilities | ||
Variable-rate debt | $ 335,000 | $ 560,000 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Dec. 24, 2023 | Dec. 24, 2023 | Dec. 25, 2022 | |
Lessee, Lease, Description [Line Items] | |||
Impairment of long-lived assets | $ 43 | $ 2,845 | $ 0 |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Renewal term (in years) | 5 years | 5 years |
Leases - Operating Lease Assets
Leases - Operating Lease Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Leases [Abstract] | ||
Operating lease assets | $ 95,906 | $ 106,828 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other current liabilities | Other current liabilities |
Operating lease liabilities, current | $ 14,316 | $ 16,351 |
Operating lease liabilities, long-term | 95,429 | 103,313 |
Total lease liabilities | $ 109,745 | $ 119,664 |
Leases - Lease Cost (Details)
Leases - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | Mar. 31, 2023 | |
Leases [Abstract] | |||||
Fixed operating lease costs | $ 6,757 | $ 7,406 | $ 21,026 | $ 20,300 | |
Variable operating lease costs | 1,208 | 522 | 3,453 | 1,980 | |
Operating and sub-lease income | (262) | (157) | (692) | (464) | |
Net lease costs | $ 7,703 | $ 7,771 | $ 23,787 | $ 21,816 | |
Weighted average remaining lease term (years): | 9 years 4 months 2 days | 9 years 4 months 2 days | 9 years 8 months 15 days | ||
Weighted average discount rate: | 8.52% | 8.52% | 8.43% |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Leases [Abstract] | ||
Remainder of fiscal year 2024 | $ 6,546 | |
Fiscal year 2025 | 21,412 | |
Fiscal year 2026 | 19,562 | |
Fiscal year 2027 | 17,041 | |
Fiscal year 2028 | 14,683 | |
Thereafter | 84,463 | |
Total lease payments | 163,707 | |
Less imputed interest | (53,962) | |
Present value of lease liabilities | $ 109,745 | $ 119,664 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Dec. 24, 2023 | Dec. 25, 2022 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities, operating leases | $ 20,239 | $ 16,623 |
Operating lease assets obtained in exchange for lease liabilities, operating leases | 7,498 | 33,228 |
Operating lease assets obtained in exchange for lease liabilities, ROU asset re-measurement | $ (6,105) | $ 40 |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) - Fox Racing $ in Thousands | 3 Months Ended |
Dec. 25, 2022 USD ($) | |
Business Acquisition [Line Items] | |
Business combination, pro forma information, revenue of acquiree since acquisition date | $ 124,523 |
Business combination, pro forma information, net income of acquiree since acquisition date | $ 2,498 |
Acquisitions - Supplemental Pro
Acquisitions - Supplemental Pro Forma Data (Details) - Fox Racing - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Dec. 25, 2022 | Dec. 25, 2022 | |
Business Acquisition [Line Items] | ||
Sales, net | $ 754,775 | $ 2,444,920 |
Net income | $ 68,075 | $ 286,732 |
Acquisitions - Significant Nonr
Acquisitions - Significant Nonrecurring Adjustments to Net Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Depreciation | $ 36,981 | $ 35,660 | ||
Income tax provision (benefit) | $ (46,995) | $ 13,225 | $ (16,122) | 77,844 |
Revolving Credit Facility and Secured Debt | 2022 ABL Revolving Credit Facility and 2022 Term Loan Facility | Line of Credit | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Asset-based revolving credit facility | $ 580,000 | $ 580,000 | ||
Weighted average interest rate (as a percent) | 5.58% | 5.58% | ||
Fox Racing | Fees for advisory, legal, accounting services | ||||
Business Acquisition, Pro Forma Information, Nonrecurring Adjustment [Line Items] | ||||
Fees for advisory, legal, and accounting services | $ (99) | $ (6,064) | ||
Inventory step-up, net | (3,772) | (6,287) | ||
Interest | 0 | 10,627 | ||
Depreciation | 0 | 719 | ||
Amortization | 0 | 4,245 | ||
Management Fees | 0 | (530) | ||
Income tax provision (benefit) | $ 943 | $ (1,199) |
Derivative Financial Instrume_2
Derivative Financial Instruments - Narrative (Details) $ in Thousands, lb in Millions | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 USD ($) | Dec. 25, 2022 USD ($) | Dec. 24, 2023 USD ($) lb | Dec. 25, 2022 USD ($) | |
Lead forward contracts | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative, notional amount, mass | lb | 1.3 | |||
Foreign currency forward contracts | Derivatives not designated as hedging instruments | ||||
Derivatives, Fair Value [Line Items] | ||||
Foreign currency translation gains (losses) | $ 509 | $ 33 | $ 720 | $ 866 |
Foreign currency forward contracts | Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative, notional amount | $ 3,518 | $ 3,518 | ||
Foreign currency forward contracts | Minimum | Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative, remaining maturity | 12 months | 12 months | ||
Foreign currency forward contracts | Maximum | Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative, remaining maturity | 15 months | 15 months |
Derivative Financial Instrume_3
Derivative Financial Instruments - Interest Rate Swaps (Details) | Dec. 24, 2023 USD ($) |
Interest Rate Swap, Maturing February 2026 | |
Derivative [Line Items] | |
Notional | $ 50,000,000 |
Fair Value | $ (499,000) |
Pay Fixed | 4.91% |
Receive Floating | 5.378% |
Interest Rate Swap, Maturing March 2026 | |
Derivative [Line Items] | |
Notional | $ 25,000,000 |
Fair Value | $ (352,000) |
Pay Fixed | 4.65% |
Receive Floating | 5.345% |
Derivative FInancial Instrume_4
Derivative FInancial Instruments - Fair Value by Balance Sheet Location (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Assets | $ 0 | $ 91 |
Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Liabilities | 920 | 5,012 |
Other current assets | Foreign currency forward contracts | Derivatives not designated as hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Assets | 0 | 91 |
Other current liabilities | Foreign currency forward contracts | Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Liabilities | 69 | 3,252 |
Other long-term liabilities | Interest rate swap contract | Cash Flow Hedging | Derivatives designated as cash flow hedging instruments | ||
Derivatives, Fair Value [Line Items] | ||
Fair Value of Derivative Liabilities | $ 851 | $ 1,760 |
Derivative FInancial Instrume_5
Derivative FInancial Instruments - Quantitative Disclosures of Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) recognized in other comprehensive income | $ (1,346) | $ (585) | $ 1,564 | $ (1,615) |
Gain (loss) reclassified from other comprehensive income into earnings | (280) | 94 | (2,192) | 123 |
Foreign currency forward contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) recognized in other comprehensive income | (100) | (2,920) | 142 | (2,920) |
Foreign currency forward contracts | Cost of sales | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) reclassified from other comprehensive income into earnings | (160) | 0 | (1,349) | 0 |
Foreign currency forward contracts | Other income (expense), net | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) reclassified from other comprehensive income into earnings | (417) | 0 | (1,634) | 0 |
Lead forward contracts | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) recognized in other comprehensive income | (123) | 2,335 | 153 | 1,305 |
Lead forward contracts | Cost of sales | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) reclassified from other comprehensive income into earnings | 141 | 94 | 431 | 123 |
Interest rate swap contract | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) recognized in other comprehensive income | (1,123) | 0 | 1,269 | 0 |
Interest rate swap contract | Interest expense, net | ||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||
Gain (loss) reclassified from other comprehensive income into earnings | $ 156 | $ 0 | $ 360 | $ 0 |
Revenue Recognition (Details)
Revenue Recognition (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Sales, net | $ 682,253 | $ 754,775 | $ 2,052,394 | $ 2,339,065 |
Minimum | ||||
Disaggregation of Revenue [Line Items] | ||||
Contract with customer, payment terms (in days) | 30 days | |||
Maximum | ||||
Disaggregation of Revenue [Line Items] | ||||
Contract with customer, payment terms (in days) | 60 days | |||
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 578,829 | 628,146 | $ 1,704,321 | 1,937,742 |
Rest of the world | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 103,424 | 126,629 | 348,073 | 401,323 |
Sporting Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 364,949 | 401,504 | 1,091,041 | 1,344,620 |
Outdoor Accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 74,648 | 79,623 | 188,700 | 221,704 |
Action Sports | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 111,778 | 132,322 | 367,076 | 373,139 |
Outdoor Recreation | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 130,878 | 141,326 | 405,577 | 399,602 |
The Kinetic Group | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 364,949 | 401,504 | 1,091,041 | 1,344,620 |
The Kinetic Group | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 330,556 | 367,056 | 985,321 | 1,244,437 |
The Kinetic Group | Rest of the world | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 34,393 | 34,448 | 105,720 | 100,183 |
The Kinetic Group | Sporting Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 364,949 | 401,504 | 1,091,041 | 1,344,620 |
Revelyst | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 317,304 | 353,271 | 961,353 | 994,445 |
Revelyst | United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 248,273 | 261,090 | 719,000 | 693,305 |
Revelyst | Rest of the world | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 69,031 | 92,181 | 242,353 | 301,140 |
Revelyst | Outdoor Accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 74,648 | 79,623 | 188,700 | 221,704 |
Revelyst | Action Sports | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | 111,778 | 132,322 | 367,076 | 373,139 |
Revelyst | Outdoor Recreation | ||||
Disaggregation of Revenue [Line Items] | ||||
Sales, net | $ 130,878 | $ 141,326 | $ 405,577 | $ 399,602 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Numerator: | ||||
Net income (loss) | $ (148,195) | $ 65,147 | $ (45,673) | $ 284,617 |
Denominator: | ||||
Basic EPS shares outstanding (in shares) | 58,078,000 | 56,574,000 | 57,866,000 | 56,538,000 |
Dilutive effect of stock-based awards (in shares) | 0 | 1,269,000 | 0 | 1,484,000 |
Diluted EPS shares outstanding (in shares) | 58,078,000 | 57,843,000 | 57,866,000 | 58,022,000 |
Earnings (loss) per common share: | ||||
Basic (in dollars per share) | $ (2.55) | $ 1.15 | $ (0.79) | $ 5.03 |
Diluted (in dollars per share) | $ (2.55) | $ 1.13 | $ (0.79) | $ 4.91 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from computation of diluted earnings per share, because either the effect would have been anti-dilutive, or the options’ exercise prices were greater than the average market price of the common stock | 300,000 | 23,000 | 300,000 | 316,000 |
Common Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Potentially dilutive securities excluded from computation of diluted earnings per share, because either the effect would have been anti-dilutive, or the options’ exercise prices were greater than the average market price of the common stock | 0 | 0 |
Receivables (Components of Rece
Receivables (Components of Receivables) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Receivables [Abstract] | ||
Trade receivables | $ 377,943 | $ 349,424 |
Other receivables | 16,095 | 8,899 |
Less: allowance for estimated credit losses and discounts | (20,028) | (18,950) |
Net receivables | $ 374,010 | $ 339,373 |
Receivables (Narrative) (Detail
Receivables (Narrative) (Details) | 9 Months Ended | |
Dec. 24, 2023 | Dec. 25, 2022 | |
Walmart | Accounts Receivable | Credit Concentration Risk | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 12% | 10% |
Receivables (Reconciliation of
Receivables (Reconciliation of Allowance for Doubtful Accounts) (Details) $ in Thousands | 9 Months Ended |
Dec. 24, 2023 USD ($) | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |
Balance at beginning of period | $ 18,950 |
Provision for credit losses | 2,228 |
Write-off of uncollectible amounts, net of recoveries | (1,150) |
Balance at end of period | $ 20,028 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 198,497 | $ 199,225 |
Work in process | 66,899 | 63,652 |
Finished goods | 389,443 | 447,020 |
Net inventories | 654,839 | 709,897 |
Long-term inventories | $ 41,982 | $ 45,929 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (AOCL) (Components of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Equity [Abstract] | ||
Derivatives | $ (683) | $ (3,543) |
Pension and other postretirement benefits liabilities | (69,763) | (71,449) |
Cumulative translation adjustment | (4,885) | (5,810) |
Total AOCL | $ (75,331) | $ (80,802) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss (AOCL) (Changes in the Balance of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 1,225,744 | $ 1,349,451 | $ 1,131,793 | $ 1,124,399 |
Net actuarial losses reclassified from AOCL | (562) | (694) | (1,686) | (2,082) |
Net change in cumulative translation adjustment | 704 | 1,173 | 5,471 | 412 |
Ending balance | 1,082,905 | 1,420,652 | 1,082,905 | 1,420,652 |
Derivatives | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | 129 | (634) | (3,543) | (356) |
Change in fair value of derivatives | (1,346) | (585) | 1,564 | (1,615) |
Income tax impact on derivative instruments | 254 | 164 | (896) | 945 |
Net losses/(gains) reclassified from AOCL | 280 | (94) | 2,192 | (123) |
Ending balance | (683) | (1,149) | (683) | (1,149) |
Pension and other postretirement benefits liabilities | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (70,325) | (69,687) | (71,449) | (71,075) |
Net actuarial losses reclassified from AOCL | 562 | 694 | 1,686 | 2,082 |
Ending balance | (69,763) | (68,993) | (69,763) | (68,993) |
Cumulative translation adjustment | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (5,839) | (7,119) | (5,810) | (5,248) |
Net change in cumulative translation adjustment | 954 | 994 | 925 | (877) |
Ending balance | (4,885) | (6,125) | (4,885) | (6,125) |
Total | ||||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||||
Beginning balance | (76,035) | (77,440) | (80,802) | (76,679) |
Change in fair value of derivatives | (1,346) | (585) | 1,564 | (1,615) |
Income tax impact on derivative instruments | 254 | 164 | (896) | 945 |
Net losses/(gains) reclassified from AOCL | 280 | (94) | 2,192 | (123) |
Net actuarial losses reclassified from AOCL | 562 | 694 | 1,686 | 2,082 |
Net change in cumulative translation adjustment | 954 | 994 | 925 | (877) |
Ending balance | $ (75,331) | $ (76,267) | $ (75,331) | $ (76,267) |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Goodwill Rollforward) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Dec. 24, 2023 | Dec. 24, 2023 | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 465,709 | |
Impairment | (161,714) | |
Goodwill, ending balance | $ 303,995 | 303,995 |
The Kinetic Group | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 86,105 | |
Impairment | 0 | |
Goodwill, ending balance | 86,105 | 86,105 |
Revelyst | ||
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | 379,604 | |
Impairment | (161,714) | |
Goodwill, ending balance | 217,890 | $ 217,890 |
Revelyst | Outdoor Cooking | ||
Goodwill [Roll Forward] | ||
Impairment | (26,219) | |
Revelyst | Stone Glacier | ||
Goodwill [Roll Forward] | ||
Impairment | (9,955) | |
Revelyst | Golf | ||
Goodwill [Roll Forward] | ||
Impairment | $ (125,540) |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Dec. 24, 2023 USD ($) | Dec. 25, 2022 USD ($) | Dec. 24, 2023 USD ($) | Dec. 25, 2022 USD ($) | Mar. 31, 2023 USD ($) | |
Goodwill [Line Items] | |||||
Impairment | $ 161,714 | ||||
Amortizing intangible assets, impairment charges | (6,798) | ||||
Amortization of intangible assets | $ 12,490 | $ 12,448 | $ 37,826 | $ 31,431 | |
Acquired finite-lived intangible assets, weighted average useful life (in years) | 11 years 7 months 24 days | ||||
Trade names | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | 200,303 | $ 200,303 | $ 250,603 | ||
Revelyst | |||||
Goodwill [Line Items] | |||||
Goodwill, accumulated impairment losses | 1,488,676 | 1,488,676 | $ 1,326,962 | ||
Impairment | 161,714 | ||||
Indefinite-lived intangible assets, impairment losses | (50,300) | ||||
Revelyst | Outdoor Cooking | |||||
Goodwill [Line Items] | |||||
Impairment | 26,219 | ||||
Revelyst | Outdoor Cooking | Customer Relationships | |||||
Goodwill [Line Items] | |||||
Amortizing intangible assets, impairment charges | (5,805) | ||||
Revelyst | Outdoor Cooking | Trade names | |||||
Goodwill [Line Items] | |||||
Amortizing intangible assets, impairment charges | (993) | ||||
Revelyst | Stone Glacier | |||||
Goodwill [Line Items] | |||||
Impairment | 9,955 | ||||
Revelyst | Golf | |||||
Goodwill [Line Items] | |||||
Impairment | 125,540 | ||||
Revelyst | Fox Racing | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | 58,400 | $ 58,400 | |||
Revelyst | Fox Racing | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (26,600) | ||||
Revelyst | Fox Racing | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.03 | 0.03 | |||
Revelyst | Camelbak | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 13,300 | $ 13,300 | |||
Revelyst | Camelbak | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (9,600) | ||||
Revelyst | Camelbak | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.015 | 0.015 | |||
Revelyst | Bell Cycling | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 12,000 | $ 12,000 | |||
Revelyst | Bell Cycling | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (6,100) | ||||
Revelyst | Bell Cycling | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.015 | 0.015 | |||
Revelyst | Simms Fishing | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 25,500 | $ 25,500 | |||
Revelyst | Simms Fishing | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (4,500) | ||||
Revelyst | Simms Fishing | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.03 | 0.03 | |||
Revelyst | Giro | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 15,300 | $ 15,300 | |||
Revelyst | Giro | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (1,800) | ||||
Revelyst | Giro | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.015 | 0.015 | |||
Revelyst | Bushnell | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 14,900 | $ 14,900 | |||
Revelyst | Bushnell | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (1,100) | ||||
Revelyst | Bushnell | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.01 | 0.01 | |||
Revelyst | Bell Powersports | |||||
Goodwill [Line Items] | |||||
Non-amortizing trade names | $ 3,500 | $ 3,500 | |||
Revelyst | Bell Powersports | Trade names | |||||
Goodwill [Line Items] | |||||
Indefinite-lived intangible assets, impairment losses | $ (600) | ||||
Revelyst | Bell Powersports | Trade names | Measurement Input, Royalty Rate | |||||
Goodwill [Line Items] | |||||
Indefinite lived intangibles, measurement input | 0.01 | 0.01 | |||
The Kinetic Group | |||||
Goodwill [Line Items] | |||||
Goodwill, accumulated impairment losses | $ 0 | $ 0 | |||
Impairment | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Schedule of Net Intangible Assets) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | $ 672,732 | $ 681,006 |
Accumulated amortization | (234,737) | (198,433) |
Total | 437,995 | 482,573 |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 873,035 | 931,609 |
Accumulated amortization | (234,737) | (198,433) |
Net intangible assets | 638,298 | 733,176 |
Trade names | ||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Non-amortizing trade names | 200,303 | 250,603 |
Trade names | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 112,686 | 113,915 |
Accumulated amortization | (35,902) | (30,848) |
Total | 76,784 | 83,067 |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Accumulated amortization | (35,902) | (30,848) |
Patented technology | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 36,854 | 36,854 |
Accumulated amortization | (18,515) | (16,313) |
Total | 18,339 | 20,541 |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Accumulated amortization | (18,515) | (16,313) |
Customer relationships and other | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross carrying amount | 523,192 | 530,237 |
Accumulated amortization | (180,320) | (151,272) |
Total | 342,872 | 378,965 |
Acquired Indefinite-lived Intangible Assets [Line Items] | ||
Accumulated amortization | $ (180,320) | $ (151,272) |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets (Future Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Remainder of fiscal year 2024 | $ 12,441 | |
Fiscal year 2025 | 49,746 | |
Fiscal year 2026 | 46,736 | |
Fiscal year 2027 | 45,286 | |
Fiscal year 2028 | 40,116 | |
Thereafter | 243,670 | |
Total | $ 437,995 | $ 482,573 |
Long-term Debt (Components of L
Long-term Debt (Components of Long-term Debt) (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 835,000 | $ 1,060,000 |
Less: unamortized deferred financing costs related to term loans | (6,014) | (10,342) |
Carrying amount of long-term debt | 828,986 | 1,049,658 |
Less: current portion | (65,000) | (65,000) |
Carrying amount of long-term debt, excluding current portion | 763,986 | 984,658 |
Line of Credit and Senior Loans | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 335,000 | 560,000 |
Senior Notes, 4.5% | Senior Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 500,000 | 500,000 |
Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Line of Credit | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 270,000 | 355,000 |
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Senior Loans | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 65,000 | $ 205,000 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | Mar. 31, 2023 | |
Debt Instrument [Line Items] | |||||
Long-term debt, gross | $ 835,000,000 | $ 835,000,000 | $ 1,060,000,000 | ||
Interest paid | $ 10,218,000 | $ 11,800,000 | $ 40,031,000 | $ 25,011,000 | |
Guarantors | |||||
Debt Instrument [Line Items] | |||||
Number of subsidiaries owned (as a percent) | 100% | 100% | |||
Senior Notes, 4.5% | |||||
Debt Instrument [Line Items] | |||||
Amortization of debt issuance costs, period (in years) | 8 years | ||||
Debt issuance costs | $ 4,491,000 | $ 4,491,000 | |||
Guarantor obligations, maximum exposure, undiscounted | 75,000,000 | 75,000,000 | |||
Senior Notes, 4.5% | Carrying amount | Fair Value, Recurring | |||||
Debt Instrument [Line Items] | |||||
Fixed-rate debt | 500,000,000 | 500,000,000 | 500,000,000 | ||
Senior Notes, 4.5% | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Long-term debt, gross | $ 500,000,000 | $ 500,000,000 | 500,000,000 | ||
Debt instrument, interest rate (as a percent) | 4.50% | 4.50% | |||
Senior Notes, 4.5% | Senior Notes | Debt Instrument, Redemption, Period One | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, redemption price, percentage of principal amount redeemed | 100% | ||||
Senior Notes, 4.5% | Senior Notes | Debt Instrument, Redemption, Period Two | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, redemption price, percentage of principal amount redeemable (as a percent) | 0.40 | ||||
Debt instrument, redemption price, net cash proceeds, percentage of principal amount redeemable, period two (as a percent) | 104.50% | ||||
Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Line of Credit | |||||
Debt Instrument [Line Items] | |||||
Term loan facility | $ 600,000,000 | $ 600,000,000 | |||
Long-term debt, gross | 270,000,000 | 270,000,000 | 355,000,000 | ||
Letters of credit outstanding, amount | 14,878,000 | 14,878,000 | |||
Restricted payment limit | 57,000,000 | 57,000,000 | |||
Line of credit facility, remaining borrowing capacity | $ 208,566,000 | $ 208,566,000 | |||
Annual commitment fee on the unused portion (as a percent) | 0.175% | ||||
Debt instrument, covenant, minimum threshold line of capacity (as a percent) | 10% | ||||
Consolidated leverage ratio | 1.8 | 1.8 | |||
Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Line of Credit | Maximum | |||||
Debt Instrument [Line Items] | |||||
Maximum consolidated leverage ratio | 3 | 3 | |||
Line of credit facility, increased borrowing capacity, amount | $ 150,000 | $ 150,000 | |||
Revolving Credit Facility | ABL Revolving Credit Facility, 2021 and 2022 | Line of Credit | |||||
Debt Instrument [Line Items] | |||||
Unamortized debt issuance cost | $ 11,310,000 | $ 11,310,000 | |||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Credit spread adjustment (as a percent) | 0.10% | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Minimum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 2.50% | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Minimum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 3.50% | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Maximum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 3% | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Maximum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 4% | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Line of Credit | |||||
Debt Instrument [Line Items] | |||||
Amortization of debt issuance costs, period (in years) | 2 years | ||||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Senior Loans | |||||
Debt Instrument [Line Items] | |||||
Term loan facility | $ 350,000,000 | $ 350,000,000 | |||
Long-term debt, gross | $ 65,000,000 | $ 65,000,000 | $ 205,000,000 | ||
Quarterly payment, percentage of principal amount (as a percent) | 10% | 10% | |||
Debt issuance costs | $ 10,453,000 | $ 10,453,000 | |||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Senior Loans | Aggregate Outstanding Principal Exceeding Term Loan Threshold | |||||
Debt Instrument [Line Items] | |||||
Quarterly payment, percentage of principal amount (as a percent) | 12.50% | 12.50% | |||
Secured Debt | 2022 Term Loan - Senior secured asset-based term loan facility | Senior Loans | Aggregate Outstanding Principal Equal To Or Less Than Term Loan Threshold | |||||
Debt Instrument [Line Items] | |||||
Quarterly payment, percentage of principal amount (as a percent) | 10% | 10% | |||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Weighted average interest rate (as a percent) | 7.18% | 7.18% | |||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 0.50% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Credit spread adjustment (as a percent) | 0.10% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Minimum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 0.25% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Minimum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 1.25% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Maximum | Base Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 0.75% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 ABL Revolving Credit Facility | Maximum | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 1.75% | ||||
Non-First-in, Last-out, Revolving Credit Facility | 2022 Term Loan - Senior secured asset-based term loan facility | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, basis spread on variable rate (as a percent) | 1.50% |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Defined Benefit Plans | ||||
Defined benefit plan, net periodic benefit | $ 237,000 | $ 382,000 | $ 711,000 | $ 1,144,000 |
Pension Plan | ||||
Defined Benefit Plans | ||||
Contribution by employer | 0 | 0 | ||
Other Postretirement Benefit Plans, Defined Benefit | ||||
Defined Benefit Plans | ||||
Contribution by employer | 0 | 0 | ||
Required and expected contributions by employer for remainder of fiscal year | 0 | 0 | ||
Supplemental Employee Retirement Plan | ||||
Defined Benefit Plans | ||||
Required and expected contributions by employer for remainder of fiscal year | $ 0 | 0 | ||
Distributions by employer | $ 0 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | Mar. 31, 2023 | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||||
Income tax provision (as a percent) | 24.10% | 16.90% | 26.10% | 21.50% | |
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 21% | ||||
Income taxes paid, net | $ 53,184 | $ 69,708 | |||
Unrecognized tax benefits | $ 26,386 | 26,386 | $ 28,692 | ||
Potential reduction of uncertain tax benefits over the next 12 months from audit settlements | 3,194 | 3,194 | |||
Minimum | |||||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||||
Unrecognized tax benefits that would impact effective tax rate | 0 | 0 | |||
Maximum | |||||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |||||
Unrecognized tax benefits that would impact effective tax rate | $ 2,562 | $ 2,562 |
Contingencies (Details)
Contingencies (Details) - USD ($) $ in Thousands | Dec. 24, 2023 | Mar. 31, 2023 |
Loss Contingency [Abstract] | ||
Total lease payments | $ 163,707 | |
Accrual for environmental loss contingencies | $ 656 | $ 717 |
Operating Segment Information_2
Operating Segment Information (Narrative) (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 USD ($) | Dec. 25, 2022 USD ($) | Dec. 24, 2023 USD ($) reportable_segment segment | Dec. 25, 2022 USD ($) | |
Revenue, Major Customer [Line Items] | ||||
Number of operating segments | segment | 8 | |||
Number of reportable segments | reportable_segment | 2 | |||
Impairment of goodwill and intangibles (Note 11) | $ | $ 218,812 | $ 0 | $ 218,812 | $ 0 |
The Kinetic Group | ||||
Revenue, Major Customer [Line Items] | ||||
Revenues from external customers, percentage | 53% | |||
Revelyst | ||||
Revenue, Major Customer [Line Items] | ||||
Revenues from external customers, percentage | 47% |
Operating Segment Information_3
Operating Segment Information (Schedule of Results by Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Dec. 24, 2023 | Dec. 25, 2022 | Dec. 24, 2023 | Dec. 25, 2022 | |
Segment Reporting Information [Line Items] | ||||
Sales, net | $ 682,253 | $ 754,775 | $ 2,052,394 | $ 2,339,065 |
Gross profit | 202,851 | 238,806 | 638,478 | 795,150 |
Operating income | (180,049) | 96,686 | (12,078) | 400,278 |
Other income, net | 86 | 639 | (1,629) | 1,380 |
Interest expense, net | (15,227) | (18,953) | (48,088) | (39,197) |
Income (loss) before income taxes | (195,190) | 78,372 | (61,795) | 362,461 |
Depreciation and amortization | 25,001 | 24,791 | 74,807 | 67,091 |
Change in fair value of contingent consideration | 3,146 | (16,403) | ||
The Kinetic Group | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 364,949 | 401,504 | 1,091,041 | 1,344,620 |
Revelyst | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 317,304 | 353,271 | 961,353 | 994,445 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 682,253 | 754,775 | 2,052,394 | 2,339,065 |
Gross profit | 202,851 | 243,855 | 638,478 | 803,233 |
Operating income | 92,494 | 131,410 | 312,684 | 498,464 |
Income (loss) before income taxes | 92,494 | 131,410 | 312,684 | 498,464 |
Depreciation and amortization | 24,064 | 23,769 | 71,973 | 63,899 |
Operating Segments | The Kinetic Group | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 364,949 | 401,504 | 1,091,041 | 1,344,620 |
Gross profit | 118,111 | 141,459 | 365,253 | 501,558 |
Operating income | 95,347 | 117,935 | 296,159 | 427,573 |
Income (loss) before income taxes | 95,347 | 117,935 | 296,159 | 427,573 |
Depreciation and amortization | 6,491 | 6,171 | 19,348 | 18,951 |
Operating Segments | Revelyst | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 317,304 | 353,271 | 961,353 | 994,445 |
Gross profit | 84,740 | 102,396 | 273,225 | 301,675 |
Operating income | (2,853) | 13,475 | 16,525 | 70,891 |
Income (loss) before income taxes | (2,853) | 13,475 | 16,525 | 70,891 |
Depreciation and amortization | 17,573 | 17,598 | 52,625 | 44,948 |
Corporate and Other Reconciling Items | ||||
Segment Reporting Information [Line Items] | ||||
Sales, net | 0 | 0 | 0 | 0 |
Gross profit | 0 | (5,049) | 0 | (8,083) |
Operating income | (272,543) | (34,724) | (324,762) | (98,186) |
Income (loss) before income taxes | (287,684) | (53,038) | (374,479) | (136,003) |
Depreciation and amortization | 937 | 1,022 | 2,834 | 3,192 |
Change in fair value of contingent consideration | 4,978 | 16,403 | ||
General and administrative expenses | 49,180 | 21,167 | 101,734 | 62,574 |
Business combination, separately recognized transactions, post combination compensation expense | $ 1,405 | 3,530 | $ 4,216 | 11,130 |
Corporate and Other Reconciling Items | Fox and Simms | ||||
Segment Reporting Information [Line Items] | ||||
Business combination, step acquisition, equity interest in acquiree, remeasurement loss | $ 5,049 | $ 8,079 |