Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Christopher Killoy

[Abruptly Start] I’ll ask Kevin Reid, our General Counsel to read our caution on forward-looking statements. Then, Tom Dineen, our Chief Financial Officer will give an overview of the second quarter 2023 financial results, and then I will discuss our operations in the current market. After that, we’ll get to your questions. Kevin?

Kevin Reid

Thanks, Chris.

or to this that company’s meeting intentions, beliefs, want the made or we future hopes, of the course that expectations usual, remind statements. statements everyone in management’s are As forward-looking of predictions state the note such It in actual results those statements. the could is that company’s materially differ important from to forward-looking projected

of SEC as the to filings, company’s in those in from XX-Q’s information sec.gov. factors concerning latter materially time limited website be not that obtained Additional these but for and XXXX, Form for reports at on to or forward-looking the first including, by contacting of could of year-ended contained statements the and the SEC company to, filed second differ the the time the SEC cause XX, company or December company’s Form actual results we on the course, website XXXX, Copies documents quarters which the from the the of XX-K on at may the night. or ruger.com/corporate last

Chris? do XX, XX-Q’s and disclaims note quarters for reconciliation responsibility website. year income of December all all company GAAP net are Form our and can statements. that non-GAAP first to in the non-GAAP Please EBITDA We of to XX-K be the which of posted ended the for found EBITDA. the update Form Furthermore, XXXX, reference our our XXXX, second forward-looking to

Christopher Killoy

will discuss now, company’s Tom results. Kevin. Thanks, quarter And the second XXXX Tom?

Thomas Dineen

Thanks, Chris.

net diluted were share. earnings of quarter and XXXX, $X.XX second sales were the million $XXX.X For per

share. diluted in sales earnings per $X.XX million period $XXX.X net and XXXX, corresponding the For were were

earnings and share. $X.XX sales X months the ended For per net X, XXXX, were were million $XXX.X diluted July

period were $X.XX and XXXX, in earnings $XXX.X corresponding were million sales the For per share. diluted net

demand; the of shift a XX%. XX% production from second stronger materials, was profitability remain in as and from lower lower promotional deleveraging gross margin resulting sales with of services, from The energy toward by: product the increased relatively unfavorable second XXXX, that inflationary mix fuel; decreased to decreased our commodities, in and quarter cost costs products declined in margins costs. increases margin XXXX Our fixed quarter driven of

While down quarter, improved XXXX that sales. first quarter quarter from on the profitability pleased the our this prior essentially of are we flat from

focus continued long-term Our shareholder is balance discipline strong on in debt value financial our and sheet. evident free

cash XXXX, million. July At and investments our $XXX X, totaled short-term

fund short-term invested Our investments United which that exclusively in States are United treasury mature in bills market a treasury X-year. in and instruments, States money invests within

ratio $XXX.X we X.X At Stockholders’ share, had equates equity $X.XX $XX.XX and per short-term and which book to investments. debt. value XXXX, was July to current of X of our cash no was X, million, was which a

of million back first operations. the form we in that XXXX, the capital of cash half company In reinvested of generated million the of from $X.X We $XX.X expenditures. into

We approximately new related to million expect our upgrades facilities. to XXXX our capital our to $XX equipment product expenditures improvements manufacturing to and total introductions,

dividend In payment and returned paid $X per our in our XXXX, of the half $XXX.X special to first of quarterly dividends million the share shareholders of a XXXX. January we through

Our XXXX. quarterly August on payable $X.XX of Board of Directors dividend XX, XXXX, as a share shareholders declared record XX, per of August for

quarter-to-quarter. quarterly of income approximately dividend our net and, varies reminder, a is As XX% therefore,

That’s the financial update Chris? for the second quarter.

Christopher Killoy

Thanks, Tom.

categories, despite sporting the decreased XXXX. to and decreased Our including XXXX half softening the from our The the the in X% distributors rifles year to National estimated first Comparatively, background the independent of essentially first Foundation X% of Shooting half sell-through modern compared compared NICS prior period. polymer by of last in checks, second as the sales were retailers action year, from products pistols, quarter rifles. to bolt flat unit demand product some adjusted Sports

of several product inventories distributor sell-through independent levels. families review below desired remain continually We of and and our channel data trends, inventory

We of expected satisfy to continue to we current demand including better mix our revolvers Distributor align family strive production as the virtually pre-pandemic rifles, several below our the output demand. and adjust with single-action our Hawkeye of Mini-XX and our these of revolvers, to categories consumer better several opportunities most of levels, level and and to product product the and all are double-action particular. of in capitalize on our product inventories

XXXX half We these to notably, launched year. Most drive products model several demand. XXX additions in excitement by the families, the family, be XX-XX These addition Marlins received lever-action lineup. chambered Magnum. continue and In product our in the customers, products to had help Classic, model about and new the we new and have in the talked requested X been first consistently most introductions our of Classic, XX in chambered new products great Marlin rifle Winchester, with legacy to the

and single-action In family frame which one Long ammunition The steel we April, a Wrangler launched ammunition. remained one in since for Magnum XX more the two moderately-priced its XX for XXXX. revolver, Super powerful Rifle popular comes the inexpensive Wrangler has with cylinders, introduction

the previously Auto-loading rifle, the Classic the mentioned LC products Marlins pistol, and I which introduced lever-action MAX-X pistol, totaled revolver. XXX Classic $XX.X mentioned, just This past Rifle, Super major Super rifles, X the in the includes or the the pistol, million, and half Carbine, first Small-Frame of XXXX. the that sales XXXX and Wrangler New of XXXX the the years Wranglers and new Marlin lever-action sales, only product LCP Marlin in XX% include were firearm MAX like Security-XXX the

time due pistols of state for In were excited changes requirements sold the some XXXX, into the the pistols to be in we new the to quarter, second to California. also to first introduce for California in

pistol, added able purchase of the the second IV which half in hope to a Mark of add pistol, more handguns. have Now, California and customers the pistol, certified year. our of SRXX to LCP roster all California in are the the to We been

first have Those question? were we quarter the highlights of the may of XXXX. the second Operator,

Operator

the Street Markets. first [Operator with Instructions] And line from you. Lake Mark Thank question Capital comes Smith our of

open. now is line Your

Alex Sturnieks

morning, the everyone. Sturnieks Alex on Smith Mark This today. good is line for Hey,

Christopher Killoy

Good morning, Alex.

Thomas Dineen

Alex. Hi,

Alex Sturnieks

channel you firstly, can your guys with current comfort Just, talk levels about inventory? the

Christopher Killoy

Chris. is Alex, Yeah. this

channel hard just things the right look to our we product certain we’re a our inventories, catch have, we don’t that up. amount, look at just there working that And our at it there when the year. terms family. what product look at by there are are when others, families aggregate what’s at X of who out And, with frankly, we distributors times And still, turns One look in independent they’re very about and inventory. we are satisfied have now, of also in we

So we’re comfortable with that.

okay, now. is right And, again, we is it think inventory where

that are we’d see retail and okay like move the always inventory dealer’s move right where to things to the But, into to on with at. we’re course, consumer. now, across Of counter

Alex Sturnieks

promotional Thank you some if great. My heavily we [in expect for follow-up a back on promotions. That’s the so, season? you industry is, promotions dialed And here of you so have then, Do kind it] are seems [ph]? from that. holiday see to participating planning

Christopher Killoy

Friday actually, continue a rebates. variety websites at going number as get is forward of Good holiday to to selling what’s are a as in now, right we going look the now of of at there. manufacturers. we and season. right just a rebates the suspect closer I on promotions was like go strong with a if question, the from lot pretty Black lot couple that’s periods looking out There’s you I of Alex. Well, of industry, there

we’d So, to than more far statements, activity traditional again, we there too getting couple seen out years. based as early don’t and more forward-looking little to comment a but of a tell promotional as on much it’s be a in

Alex Sturnieks

all had. my very That’s for I helpful. That’s Thank you questions. taking

Christopher Killoy

Alex. Thanks,

Operator

Thank you. our One question, next moment Dionisio question please. Rommel Aegis Capital. comes And our for next from with

now is line Your open.

Rommel Dionisio

questions just back you’ve in of infrastructure if the we’ve Thank in last talk demand? the in the terms could second, ask definitely couple of Good the chain years. ability of to increased several if some a And you the flex Chris, you supply about, channel up demand you. I look anticipation years. hear I lot of you in next of wondered morning. over part And starting of investments want an demand Thank last to over in enacted just we sort one wonder that your there, I of you. And, are that cycle. seen any to is, in election spikes – prior, two decades,

Christopher Killoy

Good Rommel. questions. Thanks,

right part, as traffic any far What our in as we that gun election traditionally seeing? typically the the at say as First things of now. retail time are slowdown upcoming I’d see seeing shops as May increase kind demand, period, they certainly, hit we decrease. not in business

we beginning that saw in some So May. of

going hunting a We’re see optimistic to that season. we’re decent

to predict. comes We’re well too But, positioned excited action fall again, hunting we’re early probably, and offerings, I bolt our capitalize that. on to season, it rifle to the with when think

major we’ve And annualized in far well maintain us we inventory strong ramp And able our where up, million got on our a amount over certain your we’ve few gun we takes balance second as longer units Missouri. basis. facility sheet, decent a our X to with to question up. to categories City, to time molding as metal as ago ability injection think, also just up, I And, flex our ability plants built we’re but in know as an of demonstrated a years flex product Earth it three

flex cycles So through been again, we’ve up, does these if times. it many

artificial not I But, indications in seeing ready we’re kind of think, political that go. point from stimulus a to We’re this at season. of any time

seeing just We’re this point. at certainly that not

Rommel Dionisio

Okay. That’s Chris. very helpful. Thanks,

Christopher Killoy

Rommel. Thanks,

Operator

to no Mr. closing Instructions] time. comments. at this further like over [Operator conference hand currently I’m I’d And Killoy questions to for back showing the

Christopher Killoy

our sell I the and firearms. would hardworking all thank members and especially to to X,XXX like team rugged, design, who Ruger you loyal this I’d operator. our And for of also shareholders. reliable our build call, attending Thanks, like of customers thank

and [Technical And, your I of finally, encourage Ruger your family. favorite you. or enjoy Sports all Shooting Month. to Thank with reminder August go that and indoor and outside make a enjoy safely get those is range friends you just associates to Difficulty] National

Operator

This you. participation. your today’s Thank call. concludes Thank you conference for

day. You disconnect. have may a now wonderful Everyone

Sturm, Ruger & Company (RGR) 3 Aug 232023 Q2 Earnings call transcript