JOUT - Earnings call transcript Q4 2019

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Operator

Hello, everyone and welcome to the Johnson Outdoors Fourth Quarter 2019 Earnings Conference Call. Today's call will be led by Helen Johnson-Leipold, Johnson Outdoors' Chairman and Chief Executive Officer. Also, on the call is David Johnson, Vice President and Chief Financial Officer.

Prior to the question-and-answer session, all participants will be placed in a listen-only mode. After the prepared remarks, the question-and-answer session will begin. is call This Instructions] being recorded. [Operator

implies participation consents on call. this recording Your

you these line. to not simply If agree the terms, do drop off

I Please turn Penman would to over now Patricia to the from ahead, go call Outdoors. Ms. Penman. Johnson like

Patricia Penman

you everyone. discussion Outdoors' the Good for us fourth fiscal Johnson joining Thank you. for for Thank quarter results XXXX morning, our of and full-year.

at copy of is our website it today's available Relations. release, a johnsonoutdoors.com, news need Investor you If under on

call and may remind are of to also many are may conference from statements Johnson events These basis that I differ control. not Actual forward-looking you statements factors, those contain beyond Outdoors' this due made of need statements. our assumptions guarantees the a on to performance. of materially current future views and number

include and These Commission. Exchange our listed those the with risks Securities in and filings and press uncertainties release

me. If questions, Johnson you have additional or the call, Dave contact please following

pleasure over It call is the my to now turn Johnson-Leipold. Helen to

Helen Johnson-Leipold

morning take each for and full Good thank and and review quarter discuss performance key the Dave Pat. you results, forward. – we'll the financial I'll in excuse going drivers joining start with then outline me, on year your and will Thanks, questions. business, off comments priorities highlights, us.

over fourth recreation and year. is company $XXX significantly Total up million, momentum XX.X% grew a XX% fourth fiscal were into quarter, improvement when weather prior income $XX.X our million, from quarter well. down was gearing million, prior In and continued net a period year's revenue X% the share, profits the XXXX, for year. net were per fiscal $X.XX warm increase industry $XX.X profits $XXX.X to were positive as Strong the diluted at million fiscal or sales outdoor a

from the in this deep possible, consumer year's outdoor ensures, rich and growth. in into translating right at investment right product sustained value and right factors success recreation with price. the performance time at critical are the experiences to All we our the beginning end. best sustained right right the consumer continued Overall, insights of are focus way This targeting the the and reflects our behind

on its ongoing and the with new legacy continued profitable growth business technologies. success Fishing Our trajectory, of

– record the and Kota pioneering go the innovation to for successful Minn the was fishing best experiences made track has brands made Our Humminbird water. on possible

enable Our by had coupled Imaging, underwater MEGA and views. HELIX Humminbird fish particularly state-of-the- deep how advancements consumer deep anglers insights, finder constantly the help sonar GPS us and driven year, reimagine technologies, gives wireless continued in our our MEGA great for and and to to more with series, primarily catch anglers clear our excitement demand redefine fish. a imaging art

this In addition, group HELIX the to an the consumers. larger door technology mid-sized fishing series opens small and on of even

well also which all-weather Humminbird is which leader fishing bodes for technology. brand, For in sport, an a some anglers, ice fishing is our

at ICAST Our easily CHIRP to won ice And Ice or fishing Fishing new year. Best earlier ICE ICE HELIX HELIX more productive unmapped all sonar new awarded locate the and the anglers remote holes. allows terrain the quickly lakes with of Dual of Spectrum this map

Also launched coverage. and option unmatched the Imaging MEGA latest provides at that it's XXX high with detail XXX-degree ICAST innovation and our view resolution only a sonar

to directly make every know MEGA in can count a they have with their anglers over underwater, targeting boat. Before move the XXX, front boat but XXX, of to spot was MEGA cast what by

to can their technology, command XXX have ways allows looking products always for Minn view and anglers of MEGA with our and We're seamlessly Kota under that effortless communicate. together new boats Imaging the integrate Spot-Lock water.

fishing technical as knowledge consumers, and sustain to growth Outdoors. key for of coupled with fishing will building our invest Humminbird engines our profitable Minn upon Johnson our We in to continue know-how and strengths, Kota

critical to recreation Business. consumers been consumers what of gateway Camping that understanding more an all-important is deep other. A our in any marketplace outdoor has Camping also than want experience touches camping

the the growing giving camping technology in and and generation, leader savvy enthusiasts. systems next participation us to outdoor group needs position setting of strong the Jetboil, cooking stage continues in for tailored is tech portable a expectations. grow, Importantly, with new the among strong to new their outdoor emerging innovations

Looking even will with ahead, for opportunity and in consumer digital this continue Camping we more target our marketing, to There’s e-commerce in real consumer. innovation space long-term. enhanced invest to insight driven growth and engage

continues dynamics. in focus business success That's future. and Rec our to the marketplace Watercraft brands investing why to innovation Our challenging in for is on our face technology position

long-term and OLD Town grow It's offers to share anglers. kayak. with propulsion and brands. continues more pedal-powered and in The on in fishing the are forward agility to gaining in we're reel segment fish. pedal-powered reverse work and the time this precise, their allows growth kayak both watercraft advanced our segment to More of fishing for for most Topwater to steering keep angler recreation we're sustaining the pedal-controlled strengthen innovation capitalize hands-free ever – opportunities like and necessary The designed innovation Topwater

XXXX. emphasis in Kong. resulting momentum North trends in positive in due gains digital the were American and retail on Asia and Hong declined, primarily business, to In market positive political sales. flat driven marketing, fiscal diving, throughout In was e-commerce continued our unrest European by our

our will business brand North to strengthen our building we beyond learnings diving our America. support forward, efforts leverage Going to and

trusted sustained ensure innovation Our will efforts remains and most world's with SCUBAPRO continued along simplification of our dive model brand. the digital business

year a to that's to portfolio the long and last. hard for to next brands at XX the view we've working years, enterprise nearly For growth be unparalleled or built Johnson thriving diverse beyond well Outdoors' businesses position with our taken quarter next

key accelerated focus sources continue focus Consumer new invest in strategic drivers. innovation on sustained e-commerce. to our leadership, ahead, will understanding, in paths on we growth digital our and increasing of and Looking and sophistication, five markets,

generation best experience provide outdoor possible. strategic We will sustain an recreation importantly investments of next recreation smart with most market and positions the in outdoor the continue increasingly technology to as and leadership to make consumers competitive industry, to outdoor

over financial for of the Dave the review a I'll Dave? call to Now, highlights. turn

David Johnson

Thank wanted you, highlight to everyone. Helen. the morning from and few Good things year. the I a quarter

strong slow due demand in seasonally compared quarter year's our tailwind, and into with businesses. the continued a came we largely camping Operating quarter favorably fourth quarter, $X by fourth to the by mentioned, million, to Helen the our fishing growth. prior driven in profit As sales

Additionally, we recovered as granted result of $X.X exclusions fourth fiscal a in of million of quarter tariffs, the XXXX.

original remained gross of total tariffs negative other For the year over from year mitigation fiscal XXXX, on margins prior full and grew from throughout fiscal XXXX despite million the $X.X sales The impact reduce moderately tariffs. exclusions impact the efforts and help year steady estimates. profits

increases the range negatively impact could the to in $X $X million we profits XXXX, expect in fiscal proposed tariffs of In million.

reducing the pursue we the As fiscal case and in impact will efforts of possible mitigation tariffs. was hopes XXXX, of all

Operating for by largely the higher volume year, expenses sales related costs higher expense. were debt and bad driven increased

from over income rate, year the for in tax rate. lower corporate benefited the a investment the prior increased marketing reflecting in reduction the year. Net Additionally, tax U.S. federal income

to Fiscal tax prior was of XX.X%, XX.X%. rate year's compared XXXX's effective fiscal the full-year rate

we effective around year, be Next expect the tax to the rate mid-XXs.

next growth. year, we ahead Looking continued moderate expect sales to

opportunities. continue position and our sheet to is in us to enables cash strong balance invest growth healthy Our

the Q&A Now, back the operator session. Operator? the call turn to I'll for over

Operator

Lebiedzinski Thank of you. first from Sidoti. Our comes Anthony [Operator Instructions] question

open. now is line Your

Anthony Lebiedzinski

questions. thank you Good the for morning taking and

well. guys So, about, talked know, about obviously here in as performance a a the tariffs little very solid quarter. you bit I

issues, the impact XXXX of if I be because in negative you you maybe guess versus that is that Dave, new the some it of fiscal So, tariff to just – more of the that expect is for the timing or reason just clarify it XXXX, fiscal us? could tariffs the

David Johnson

March. that tariffs months were exclusion few It's in ago, as Yes. we well rolled expires new have It's an as in our both. costs, affecting the a do that

not on for that. So, now, right we're we'll try counting but to re-up that,

Anthony Lebiedzinski

it. Got Alright fishing and category. terms of Okay. then, in

in a So, you reported. new the certainly the was of very it quarter in good field. are just couple There competitors that

looking this, – have to from tackle to So, of just what retail new that you're how far competition? to as some just your do sense or your as better maintain seen partners, been floor ability you Have you wondering, is to able as get as anything your space? to trying you this a guys

Helen Johnson-Leipold

It’s still as selling early, planned. but going far, our is so

end know first So, we'll more our quarter. of at the

Anthony Lebiedzinski

continues up cash. that to are the be at What your as And okay. sheet deploying building to it, Got very cash? strong, thoughts balance

Helen Johnson-Leipold

we've options, been lot of looking obviously acquisitions. doing do all a at to Well, looking at opportunities

considering would there. now, at timing point. from that say and strong feeling we all opportunities options. aren’t looking have the everything a great the this right are sheet we're It's again, I the out not it's actively are multiples, of but that the We balance at good to good, standpoint

Anthony Lebiedzinski

of couple business? significantly updated I And us last thoughts can improved from me, Absolutely. question years your doing as back. give with you you know direct-to-consumer websites, some your to a how you’re the

So, update Thank just you. that. an to wanted get on

Helen Johnson-Leipold

well. doing It's

of through our it new Our all are mortar, helped into But and and is our e-tailers e-commerce very well a revised marketing so direct-to-consumer, important we driving piece the bricks our communication a having DXC us – standpoint it. really and website has consider it's and from both the sales is, e-commerce just channel. as as

will about feeling evolving, great it. lot and the opportunity. participating actively we're be So, of that got still it's good but constantly in we've We businesses have all omni-channel to do work it a

Anthony Lebiedzinski

Got it.

Okay. Thank of best luck. you and

Helen Johnson-Leipold

you. Thank

David Johnson

Thanks, Anthony.

Operator

Helen turn Thank I this question-and-answer our to like does you. over conclude remarks. back ladies Johnson-Leipold session. any to gentlemen, closing and for now And would call the

Helen Johnson-Leipold

joining for have and holiday us you. a all great Thank Thank you season.

Operator

concludes gentlemen, this for call. you conference and Ladies today's Thank participating.

now may You disconnect.

Johnson Outdoors (JOUT) 6 Dec 192019 Q4 Earnings call transcript