JOUT - Earnings call transcript Q3 2021

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Operator

Hello everyone and welcome to the Johnson Outdoors Third Quarter 2021 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 in a listen-only mode. After the prepared remarks the question-and-answer session will begin. Instructions]. [Operator being is recorded. call This

participation to recording call. consent Your our this implies

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

Patricia Penman

discussion fiscal Thank you. third our quarter. Thank Outdoors Results joining us you Good Johnson for for morning for everyone. of the XXXX

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

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

Helen P. Johnson-Leipold

will and Dave with will Thanks I review key quarter businesses. thank your joining Good and will perspective for take on we begin questions. share will morning Pat. year-to-date results I outlook and an our for us. the on then overview you and and the then performance financials

of Year-to-date X.X operational company volumes. nine-month fiscal Sales ahead XX% year’s season operating XXXX to in margin the strong year-to-date year’s note and we the outdoor the increase Total quarter, $XXX.X year-to-date demand period. of of the during another to activities last net period. sales in deliver for allowed primarily prior at company million fiscal increased period. the continued company XX% unprecedented XX.X% sales, continued and over third $XX.X driven total results. stand fiscal quarter, a surged During high increased these gear as sales outdoor results. quarter operational a was strong last million weather million, quarter up is efforts third $XXX.X increase third the warm interest recreation are XX% And by of Of efficiencies points of profit was over of compared to improvement result delivered an

Kota we best the at quarter high total the drivers the In fishing operating million profit or to through $XX.X $XX.X quarter. $XX.X new third and fishing and doubled both later million to possible. experience in for continued the discuss share. previous versus financial continued will per the quarter $X.XX seasoned demand the fiscal million Dave the more Johnson Outdoors was For Net call. look key and quarter income Minn in than Humminbird in third technologies in diluted for

Our allowing captured action, clarity Live lure. in of fish structure real-time, innovation watching MEGA honors this angler’s new fish in ICAST, marking past Humminbird, delivers bite move Electronics and our show to they most prestigious even MEGA live in most the recent as in to anglers years. detail the category in at award XX in Best the XXth MEGA fishing the Live year’s Imaging world’s this in Imaging see an Imaging and on-screen

The brand the offered With with adjust monitors automatically Minn to sales active winning Kota’s product to with trusted of bottom anchoring by package have anchoring in do them impress lines, shallow and to release Minn water first its auto which catch technologies in continues industry continue first to two bottom award right single most mode, anglers is anchoring industry-leading the year density force market. more this all complete a And fish. pinning. technologies, of and well the full help to rafter brand. which detects access the rafter technology, stable anchors anchors determine a for continuously Across Kota products and bottom as force

Kayak. consumers from expectations Looking bigger, systems on get successes that lightest system will and beating cooking maintain interested those people Stash launched to experiences made. better translating be offers and for ahead, and of Minn anchors, on year. fishing market. in the Eureka continue leader for propulsion exciting Kota for the grow, leadership back that in sorts was out by versatile demand camp country. brand both Reducing this for from award-winning understanding we all about Sportsman outdoors. trail backpacking to all paddle innovative in our position be Sportsman continue a backpackers and critical products year Demand product continue watercraft Fishing XXX unique Eureka Humminbird’s earlier This leading we for gear looking AutoPilot on has great the to camping the is continues weight Jetboil evolving excited the everyone technologies enjoy insights Stash cooking to launched Jetboil, strong options backyard into all these remains that outdoor a expectations to for continue be tents anglers Watercraft and to technology ever Stove offer new stove technology pipeline The abilities is people fishing focus and and as in and the of our line camping, to is sustain In to recreations, portable our to light in day driven eager to the Salty one ongoing and Jetboil super of and kayak in of the last industry enthusiasm of water the Motorized powered kayaks segment line to sports interest. In kayak

diving, eased the pandemic diving again, third diving and as strong restrictions and in support versus had Finally, a seen European simplify up our off. traveling are with and and recover. fiscal value related quarter paying And also begin websites been XXXX. digital lockdowns e-commerce versus are our being has travel we new our local market have enhance promote is to business, work and third Diving and presence XXXX globally quarter to people

with our in focus position these we results on will sustained most recovers, dive with along efforts, SCUBAPRO’s the spending diving brand are and trusted summary, people's continued ensure In outdoors. time continued interest pleased market world. as the our As the in innovation

While the markets, issues ongoing increased for our our work to and identifying supply manage chain digital to source consumer future, new issues and fill across is in segments all optimizing strong investing in may demand to year. meet the focus committed strategic logistics disruptions in our key of We to continue demand to hard growth supply and continually ability our sustaining experience. our our near-term innovation finish a consumers, understanding leadership, to remain drivers, fiscal our impacts affect

ensures growth portfolio Outdoors. of priorities for well brands profitable for that success Our ongoing work hard sustained positioned market and that we Johnson is deliver on long-term our leading continue these to

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

David W. Johnson

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

Helen as fishing, continued and As rose year-to-date XX% increased watercraft the quarter the some sales high basis, across driven diving. quarter and camping year raft, over recovery well in prior as by demand XX% for third mentioned, on a

On to $XX.X operating $XX.X margin both during period. but Our million decreased versus Total year-to-date $X.XX XX.X% third prior efficiencies. the slightly the of primarily and inbound performance year's quarter quarter increased to tax Gross driven of basis, for sales the for million volume as quarter increasing doubled the volume fiscal quarter to XX.X% to quarter was sales the fiscal the company rate more by was year compared the Operating driven and $XX.X Net more than costs a expenses rose as than for compared during the the third compared prior driver year's a percent tariffs expenses excellent driven million last airfreight were higher to million insurance of profits profit in sales key health sales. prior claims, is $XX.X due income and year-to-date rate effective by quarter. XX.X%. year million the operating offset quarter. third higher with increased

mid full XXs. year expect We be to in tax rate the the

still providing our invest with ongoing capacity to and cash out that continue and growth and factories pay supply drive to sheet to running strategically remain to and flexibility ahead, issues are we chain a us The are balance future the cash strong, Looking remains continually managing. dividend challenge shareholders. an position to

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

Operator

Instructions]. [Operator

Our line first from of Company. question the comes Anthony Sidoti with &

now Your line open. is

Anthony Lebiedzinski

good and morning, you Thank everyone.

here. certainly So strong you've as seen you've demand a noted

that of that? Just key like you're winding better a levels at wondering retailers to sense just season, now get down the wanted so the what are inventory your

Helen P. Johnson-Leipold

is inventory the been our high. Well, have because just this stressed whole season very demand levels

much as and So, continue possible. say they below make I would normal we that product as are to

Anthony Lebiedzinski

they're also say level, it, And at retail normal okay. the would well? you Got as below

Helen P. Johnson-Leipold

that’s think I board Yes, true. across the

Anthony Lebiedzinski

it. Got

Okay. for Thanks that.

disrupting the with so last here. thing few certainly wondering weeks just So, variant Delta

to notable as you Just wondering guys changes buying patterns? end any have -- user seen demand far any as recently

Helen P. Johnson-Leipold

You know, seen still early. at have that all, so but to we it's a far reaction not

we be So monitoring would that.

Anthony Lebiedzinski

understand Got it, there. I'll the And certainly regarding all supply the chain, Thanks. issues okay. then

in press release. as far call that the did As airfreight, you out

could on usage how see the was quarter forward? to here an you in just do So wondering and impact much just if of going versus a comment airfreight you how freight ocean that of

David W. Johnson

on strategies Yeah, from shortage of the lead time it's container to we've the and the of battle coming seeing the we're employed Asia. kind one issues components

but historically, air just freight the our bit little more modestly it's inputs, year. used is to compared pronounced always we've of to compared mean, of margin It much it I was that. goods sold probably it and there kind a this here probably impacted -- So, cost

to look as of things So strategy to challenging. in the -- that be use continue we'll continue and kind to future

Anthony Lebiedzinski

Got it.

don't any healthcare was I maybe than of here, of know you that then And on off out comment thinking could labor that you're of near-term seen terms costs, I issues issues, quarter what what expect cost you in thinking one but at or just different the beginning know here if cost you versus fiscal the you've you be any called were other what would if a kind costs year? that higher Okay.

David W. Johnson

wage so into be fact there. I'm another of year's will that doing there's healthcare far pressure I the that'll the labor and thing in that. next there, our what strategies, look inputs, Yeah. But in one we just the think activity prior we if And off hoping year, there's in terms consider we're happens quarter. I as okay with because is rate I a mean no think

Anthony Lebiedzinski

me. Got two more it, again, questions okay. And for

segment about anglers. the So, nicely you mentioned that Helen to certainly increase able new you've fishing yourselves existing and anglers been about

more So into just as segments? in to maybe us or some some wondering the if your you far as insight as what as maybe could more participation you've participants as that ways far give seen data new

Helen P. Johnson-Leipold

are to really -- lag We and information. wait that there's participation little to get a know them get arms that was but but But the the plays the it all around data, a our how given that have we pandemic. getting Certainly, market of going a till longer-term. lot It's of were the we we'll is it we do data, was existing with a in of some time short-term, fishermen in what equipment some up feel that buying out. see on there the

So it of mix both. a was

Anthony Lebiedzinski

can And it, then like as your priorities, that you've far the all looking about you talk you're okay. sheet? what as on accumulating Got far been do the as as balance with cash to cash flow

David W. Johnson

Yes.

investing The what is of is so to a M&A, the in that that's is organic do business looking and with of piece cash. priority piece A growth. grow that first the to we're

us. for key both there talked fact to very the that. about active are out we those we're continue are. and We've We'll that do So

continue excited on so it's and filter discerning what tends with lot strategy, to that a a actually of about. things. our But to at look pretty We we're different put

at then So regular look we'll cash for of at. options of us. that continually, those we dividend to to key thing alternative grow dividend, that's hopefully, we are kind look and look always the continue so the could And beyond uses that, the

Anthony Lebiedzinski

Right.

thoughts you on that dividend, or Okay a to looked and just as wanted guys far special at that is about then that? a something get far as -- as just have follow-up as your a dividend

David W. Johnson

of look alternate cash of at. at continue we And the to Yes, about have potential specials, doubt at and uses that's I use No look we'll cash. mean, it. we that buybacks and strategy looked that part as of

Anthony Lebiedzinski

it. Got

thank Well, luck. much Okay. of and very you best

Helen P. Johnson-Leipold

you. Thank

Operator

remarks. I call turn are no for questions. over Thank now you. closing to will Johnson-Leipold There the Helen further

Helen P. Johnson-Leipold

Thanks you hope have Thank a day. great everyone for joining I us. you.

Operator

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

now may disconnect. You

Johnson Outdoors (JOUT) 9 Aug 212021 Q3 Earnings call transcript