JOUT - Earnings call transcript Q4 2020

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Operator

Hello everyone. And welcome to the Johnson Outdoors Fourth Quarter 2020 Earnings Conference Call. Today’s call will be held 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. the will remarks, prepared the question-and-answer begin. session After being Instructions] This is call [Operator recorded.

consent this our participation to Your implies recording call.

the now If you off to Penman would drop Outdoors. Penman. Please terms these to go turn from like ahead, Johnson do not the agree line. to call Patricia over Ms. simply I

Patricia Penman

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

johnsonoutdoors.com a copy this on of today’s Investor it need release, also available at forward-looking conference statements. that need news our These made is to website our of statements and statements due a factors, you basis not Outdoors’ current under These with beyond press contain you of assumptions I Relations. are If guarantees control. Commission. remind to the views on Johnson future and many filings and are our and the listed events in of Securities those those Exchange uncertainties may releases include risks Actual number and from performance. differ materially may

you turn Dave It pleasure Johnson my call, is to now additional or to please contact questions, If call Johnson-Leipold. me. over Helen following the the have

Helen Johnson-Leipold

Thanks, Pat. year us. on season. second stay-at-home and third year a quarter, start revenue results, year review was XXXX highlights joining income selling the of prior the the quarter you company We Good of thank very comments strong fiscal $XXX.X business started was In the and year X% drivers grew our share, and $X.XX The with $XX.X net with total financial discuss or diluted will which per XXXX, momentum from priorities our history. onset improvement like the other to and million and Dave no our X% profits our and full fiscal first but performance in then quarters, is questions. significantly going primary we’ll impacted your $XX.X heart fiscal in take forward. mandates million, for a year. cut the and million initial short the were pandemic key off each I’ll outlined morning and

extended and year’s to that as created health fueled this was meet industry the up hard got continued the employees Many people’s weather pandemic the is over enabled we safety our of strict those we to during down historically Camping momentum outdoor quarter, sales fiscal As eased, participation fourth in a positive in for and increase demand much significantly fourth increased under Johnson seasoned their demand largest performance award resolution Fishing, that grow only Total the Outdoors year. and continued $XXX.X up of anglers gearing with by XXX through The on the when XXX Fishing, Humminbird latest our we to it’s net is anglers months In are but the quarter fourth sonar us eagerness outdoors began itself Recreation. build recreation company Watercraft demand take has been always year activity to prior procedures the and the innovation our from as social warm as Strong has been reduce has spread people even COVID-XX. market that year to year’s leading and post-Labor this brand brands and innovation. advantage it work legacy quarter, season profits for And were Minn the today. saw Imaging. in in operating is the coverage. a of of period while weather high the MEGA XXX winning XX% and Imaging Overall, dedication Fishing as powerful mandates and protocols well. response consumer lends get a were ramp the and participation able to that innovation warm million brands and experiences. Kota and both is they outdoors. are and of great Humminbird accessible possible, Day degree been of business, leading favorable. high, transformed into distancing. unmatched Fishing leveraging to higher shipping market view Participation our MEGA and continuing very detail new The our an to It provides this option look

to sonar view Before side anglers moving. limited were boats MEGA XXX or their of the either what to below while

imaging monitors make stable XXX also Kota for uncompromised first Now density Raptor is the anchoring this bottom together in determine It’s anchored. an Kota with anglers can anglers their this detects has still to boat in anchoring provides adjusts Auto-Bottom together view of and favorable. is debut our water And Raptor early XXX award the response shallow if winning even to with of right world two anchor and below. bottom with technology, with continuously with year casts effortless used which MEGA but Minn Mode, When Kota industry Minn boat fish been accurate direction, anchoring automatically force command MEGA any force active technologies, and consumer pinning. which Minn the Spot-Lock

pipeline market is exciting sustaining horizon. the have priority top new we leadership ahead, innovation on in our and a Looking position technology of products and an Fishing

its steer trolling Kota hands unique free utilizes the launched paddle XXX kayak Moving The Line technology, innovative on since of flagship had Sportsmen it’s award earlier our with its year kayak in fastest anglers this the propel, year. on the kayak fishing. has year Line to and hope segment model of momentum enthusiasm that is kayaks Town Sportsmen going great two. first lot a to The market that fishing sportsmen start a and a segment line, generated Minn OLD paddle to providing Spot-Lock GPS-enabled growing new fishing this and into AutoPilot power, continue of with Watercraft, the and motor anchor we winning

saw on Recreation people to entire get more strong we Watercraft desire across As portfolio. the our water, out demand

a of as allowed made e-commerce use growing increasing the e-commerce our we’ve to us capabilities. and in buying digital investment channel the Additionally, leverage

hard among savvy outdoor Consumer dive best the keep in the in driven choice world Once experiences Jetboil, we’ll and experienced top participation been and the and key part will the key gateway for to promoting people optimize a to in Camping most the is innovation, is of and national priority trusted focus been globally experience have one open, Going integral brand safely. Comp’s pandemic-related Jetboil headwinds the the that innovation our enthusiasts. investing portable camping online is digital on and SCUBAPRO future. diving. continue are local be cooking and Eureka state parks able the began of accessible our team forward, most outdoor into tech important to technology enhancing while is due from to working to sustained and SCUBAPRO cooking benefiting strong our and activity. the leader the experience. These to we diving continues digital position an ensure to their activities and outdoor an outdoor consumer is has will do providing the both has in of and the brands interest market travel recreation presence possible restrictions, that. a continue systems our e-commerce presence surge efforts in our

and take understanding consumers consumer deep ahead in long We else our like turning creation. insights no Looking brands to quarter these the deliver to year value growth pioneering being one Johnson and long-term view enterprise well businesses at that and beyond investing built always our a next innovation. for position last next the thriving working Outdoors, continue is into in a we are to

people to the has out to come is great for which and experience Our company never there to generations purpose, inspire important. get more outdoors to been value

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

David Johnson

Helen. you, Good morning, Thank everyone.

was The effective offset working were XX.X%, the cost by a expenses from for gross $X.X chain were Watercraft to million into sales. were points As Improved Camping the slow and than increase. and million, stronger in prior compensation expenses Recreation other with primary were related Higher Volume highlight through Helen the few is local XX offset lower with X% increase XX.X%, by partially fiscal year, strong headcount, been basis XXXX demand our last can, costs prior product expenses to driven basis year’s tax discretionary from Operating possible. fourth came produce our for things much quarter increase Net and including $X last XX down tariff high businesses. points along million year. adding XX.X%. percentage up capacity fiscal supply We’ve a we rate Fishing, rate in of in absorption volumes behind our year. up was but drivers mentioned, momentum, increases costs. as mix higher year, A help warships higher managing compared a we historically as the hard income and from margin fiscal R&D to state the and spending. year taxes as $XX.X to

Next we expect mid-XX%s. up million up working are $XX about million million. in year. year to the Trade ended We the tax about be versus capital the year and receivables the rate with $X net fiscal $XX inventory prior up

season, us Looking related start constraints. caused remains to by chain related and COVID and to a monitor this ahead, increased good we’ll capacity gives supply high dynamics demand the marketplace and while demand pressures continue

drive to as smart provide investments strengthen Our our advantage balance business will strong, and make to position for value shareholders. sheet continue the healthy cash a we competitive

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

Operator

of a a We Sidoti question from Instructions] with line Lebiedzinski [Operator Anthony have Company. &

now is line open? Your

Anthony Lebiedzinski

Thank everyone. you, good and morning,

at the a throughout trends back of you can the the looking revenue as your us give So to stronger progression quarter, sense quarter?

David Johnson

about talking month-by-month you Are or?

Anthony Lebiedzinski

if -- with that’d Yeah. great? that, you I you if mean, start could be maybe could

Helen Johnson-Leipold

Yeah.

-- this me is Helen. Let

quarter for to third our Board would we when quarter, During the was into in steady was was. got the going it increase. it they from think was pent-up -- it could and kind of beginning fourth -- momentum just got were trying the stay a quarter they sure across some and in were making make of available, I as pretty continued that I of pushed the were outdoors the up availability industry. as that so demand product it, just it and because say, product it long tough People the the we

going. started as -- the demand could just everything So was as it the it soon and kept up recreate the -- -- and go out I ramping would people say,

missing and a is, there’s recreate. not to whole of wanting a mixture product buying being of being and to I also think, prepared anticipation is on think out I a continue prepared

we So have quarter the fourth it was had. best

Anthony Lebiedzinski

Okay.

Of course.

Okay.

that release So, level if said can could I good a the at just scale the a you and state you consistent that retail start with to of continue inventories is maybe off to also know, you as expand sense sounds comment There was demand. us in on but you’ll to press a like you’re operations give the Dave, what you here, that.

if operations? about talk could your commentary just press in wondering levels scaling and you inventory you your So if just about release the the

David Johnson

Yeah. mean, from demand strong is still we and what now can right tell lean. is retail pretty I inventory

to buy product So also product lot ship of retailers in continuing season. anticipation I -- to we’re think are looking the and they’re a of

to environment So there. still it pretty be lean out retail a seems

Helen Johnson-Leipold

And we like, make sure us we our XX% what safety comment scaling, we in at, done add can about can have put what the to production automatically the COVID we mean, can area, to and but do the capacity. I protocols shifts

always plans demand us be producing for prepared we more before can even the much our of time, to season, as as to and that the builds continued, go as it of so. kind forward do kept XXX% So,

Anthony Lebiedzinski

it. Got

we And of parts perhaps or are component that there as that? supply you or or good about the any just the chain, as is think Okay. issues overall with should shape far availability how then, in

David Johnson

some in for shipping and from challenge of electric competing product I with LCD we’re a consumers. It’s mean, we’re components all areas. these Asia

So that’s the challenge.

the everything We’re difficult they supply pipeline to our we frankly, but can -- now. right keep it’s through going doing chain,

Anthony Lebiedzinski

Okay. Got it.

Okay. more questions, a of those And squeeze in. then I couple just can if

season happened year? and So, is outdoor sense to next for increase of you your with levels magnitude as as in here have far kind as, the is for this of COVID? what’s expectation the what guys participation a what I past do mean,

Helen Johnson-Leipold

activities, -- a have in that new is so base these we arm sure for trying that out they in current our industry, activities. think, and know the some from we I consumers know that for We it’s there benefiting consumers whole certainly the purchasing more. consumer our shot we’re are But new jumping

know and see pan be will that’s positive how is be We gets impact. what will how what the and -- think of think be to to because normal the level we’ll COVID. yet activities But big become is, I kind is of normal have the question -- there question I out. increased available, back when things or to that don’t long-term the how participation, world --

Anthony Lebiedzinski

God.

question, And sheet. at looking for then, balance strong last Okay. your is, me very

priorities have do usage of lot for that You What’s the of a cash. cash position?

Helen Johnson-Leipold

a me just With are make the and are private lot looking that available sitting in demand there’s our this cash say just also well. being a industries, of cash -- Well, There’s at let lot a industries constantly what’s our There’s companies. not a in of equity we doing companies a to out buyer’s very that, market didn’t of obviously, opportunities lot buy. of and -- in not lot there.

and is one and the are would of decisions acquisition cash to But reasons I we not strategic market. because it’s say, do. about be the I sales we acquisitions bump we to the resiliency a think are very to always will or looking our we with we because continue So make, and an very we especially difficult we’re do strategic have have very the

time. to that out have is value our to to an we accelerate make acquisition over build ability there sure there and is to to beneficial So be us going that

being are strategic and we’re So looking it. we about

Anthony Lebiedzinski

it. Got

is if just Okay. follow cash? dividend a guess, build up guys this you would there doing could you any possibility that to on consider up that, if I special continue I cash

David Johnson

all with and think this and that we options we prudent look are at it’s cash. Anthony, paramount I strategic

at Helen driving I are the we at kind value. So, terms list, everything of but in of the think, said, acquisitions shareholder as look of top

in potentially. future option an be the would that yeah, So,

Anthony Lebiedzinski

it. Got

you Well, Okay. luck. and best thank of

Helen Johnson-Leipold

you. Thank

David Johnson

Thanks.

Operator

like Johnson-Leipold [Operator further to I’d not turn Helen questions the to Instructions] call remarks. showing any this time. at closing back I’m for

Helen Johnson-Leipold

and safe and to healthy. you, us holidays Thank and try everyone, today joining you the for stay stay you. hope Thank enjoy

Operator

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

disconnect. may You now

Johnson Outdoors (JOUT) 11 Dec 202020 Q4 Earnings call transcript