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EXHIBIT 99.1
PRESS RELEASE
ESCALADE ANNOUNCES SECOND QUARTER RESULTS
Wabash, IN (July 30, 2004) Escalade, Incorporated (NASDAQ: ESCA) announced today
that net sales rose 10% to $54,655,000 in the second quarter, bringing year to
date sales to $89,905,000, a 14% gain, as compared to year ago comparable
periods. Net income declined 13% for the quarter to $1,953,000, however, year to
date net income is up 13% to $2,551,000 or twenty cents per share as compared to
seventeen cents for last year's first half.
Escalade Sports' net sales of sporting good products rose 16% to $30,619,000 for
the quarter reflecting the inclusion of the Bear Archery acquisition for the
full quarter and the return to more normal shipping patterns due to improved
inventory management by our customers. The increased sales and continued
improvement in factory operating expenses drove a 7.5% increase in net income
for the quarter. For the first half, net sales are up 23% to $46,309,000 and net
income is up 82% compared to the same period last year. The first half has been
the beneficiary of one time sales gains that will not occur in the second half;
however, we still expect to show an increase for the full year. Subsequent to
the quarter, we signed a definitive agreement to acquire a non sporting goods
product line that meets our strategic objective of fully utilizing the capacity
of our blow molding and weight filling facility in Olney, IL. This should add
between one and two million dollars to net sales on an annual basis and will be
accretive to earnings beginning in 2005.
Net sales of office products at Martin Yale increased 3% to $24,035,000 while
net income declined 5% for the quarter. For the first half net sales are 5%
ahead at $43,596,000 and net income is 16% behind the first half of last year.
Net income in North America continues to climb (up 14% year to date) due to the
synergies achieved from the Schleicher acquisition and in spite of substantial
delays in shipments of paper shredders to certain customers due to the
finalization of new prices to offset the impact of the strong euro. Gains in
both sales and net income in the UK and France have been more than offset by the
continued operating inefficiencies in Germany. We have now fully reorganized the
management team in Germany, eliminated most of the inefficiencies, and absorbed
a significant amount of the costs of the personnel reductions in the first half,
laying the groundwork for a profitable second half. We expect that all office
product locations around the world will be profitable in the last half of this
year.
We are continuing to evaluate acquisitions in the sporting goods industry now.
We should be in a position to begin looking for opportunities in the office
products industry in the last half of 2005.
Escalade is a quality manufacturer and marketer of sporting goods and
office/graphic arts products sold worldwide. To obtain more information on the
Company and its products, visit our website at: www.EscaladeInc.com or contact
Terry Frandsen Vice President and CFO at 260/569-7208 or C.W. (Bill) Reed,
President and CEO at 260/569-7233.
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(Unaudited, In Thousands Except Per Share Amounts)
Three Months Ended Six Months Ended Twelve Months Ended
---------------------- ---------------------- ----------------------
10 July 12 July 10 July 12 July 10 July 12 July
2004 2003 2004 2003 2004 2003
--------- --------- --------- --------- --------- ---------
NET SALES .............................. $ 54,655 $ 49,837 $ 89,905 $ 78,940 $ 232,693 $ 184,688
OPERATING EXPENSES
Cost of goods sold ............... 37,125 31,160 61,643 49,819 163,827 127,070
Selling and administrative ....... 14,227 14,389 23,467 24,321 47,875 39,033
--------- --------- --------- --------- --------- ---------
OPERATING INCOME ....................... 3,303 4,288 4,795 4,800 20,991 18,585
OTHER INCOME (EXPENSE)
Interest expense ................. (573) (652) (938) (1,100) (2,121) (1,683)
Other income (expense) ........... 319 17 301 (36) 2,847 (256)
--------- --------- --------- --------- --------- ---------
INCOME BEFORE INCOME TAXES ............. 3,049 3,653 4,158 3,664 21,717 16,646
PROVISION FOR INCOME TAXES ............. (1,096) (1,399) (1,607) (1,403) (6,577) (5,782)
--------- --------- --------- --------- --------- ---------
NET INCOME ............................. $ 1,953 $ 2,254 $ 2,551 $ 2,261 $ 15,140 $ 10,864
========= ========= ========= ========= ========= =========
PER SHARE DATA
Basic earnings per share ......... $ 0.15 $ 0.17 $ 0.20 $ 0.17 $ 1.18 $ 0.83
========= ========= ========= ========= ========= =========
Diluted earnings per share ....... $ 0.15 $ 0.17 $ 0.19 $ 0.17 $ 1.15 $ 0.82
========= ========= ========= ========= ========= =========
Average shares outstanding ....... 13,018 13,000 12,949 13,010 12,884 13,013
CONSOLIDATED CONDENSED BALANCE SHEET
(Unaudited, In Thousands)
10 July 2004 12 July 2003 27 December 2003
---------------- ---------------- ----------------
ASSETS
Current assets ...................... $ 81,674 $ 81,140 $ 79,619
Property, Plant & Equipment - net ... 16,370 18,558 17,537
Other assets ........................ 16,661 15,700 18,504
Goodwill ............................ 18,715 17,791 18,777
---------------- ---------------- ----------------
Total ............................ $ 133,420 $ 133,189 $ 134,437
================ ================ ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities ................. $ 42,851 $ 52,049 $ 54,962
Other liabilities ................... 28,520 34,310 18,192
Stockholders' equity ................ 62,049 46,830 61,283
---------------- ---------------- ----------------
Total ............................ $ 133,420 $ 133,189 $ 134,437
================ ================ ================
FORWARD LOOKING STATEMENTS
This report contains forward-looking statements relating to present or future
trends or factors that are subject to risks and uncertainties. These risks,
include, but are not limited to, the impact of competitive products and pricing,
product demand and market acceptance, Escalade's ability to successfully
integrate the operations of acquired assets and businesses, new product
development, the continuation and development of key customer and supplier
relationships, Escalade's ability to control costs, general economic conditions,
fluctuations in operating results, changes in the securities markets and other
risks detailed from time to time in Escalade's filings with the Securities and
Exchange Commission. Escalade's future financial performance could differ
materially from the expectations of management contained herein. Escalade
undertakes no obligation to update these forward-looking statements after the
date of this report.