Ammo, Inc., the owner of GunBroker.com and the ammunition and components producer reported a net loss in the fiscal fourth quarter and year ended March 31 as sales dropped 37.7 percent in the quarter and 20.3 percent in the year.

Fiscal Year 2023 Overview

  • Net Revenues of $191.4 million, a 20.3 percent decrease;
  • Gross profit margin of approximately 28.9 percent;
  • Adjusted EBITDA of $26.4 million, compared to $60.8 million;
  • Net loss of ($4.6) million, compared to net income of $33.2 million;
  • Diluted EPS of ($0.07), compared to $0.27; and
  • Adjusted EPS of $0.16, compared to $0.46.

GunBroker.com Marketplace Metrics For Fiscal Year 2023

  • Marketplace revenue of approximately $63.1 million;
  • New user growth averaged 38,000 per month; and
  • Average take rate increased to 5.6 percent compared to 5.1 percent in fiscal 2022.

Fourth Quarter 2023 Overview

  • Net Revenues decreased 37.7 percent to $43.7 million;
  • Gross profit margin of approximately 27.3 percent;
  • Adjusted EBITDA of $3.8 million compared to $10.7 million;
  • Net loss of ($2.9) million, compared to net income of $0.5 million;
  • Diluted EPS of ($0.03), compared to $0.00; and
  • Adjusted EPS of $0.03, compared to $0.07.

GunBroker.com Marketplace Metrics For Fourth Quarter 2023

  • Marketplace revenue of approximately $16.7 million;
  • New user growth averaged 40,000 per month; and
  • Average take rate increased to 6.0 percent compared to 5.4 percent in fiscal 2022.

Fred Wagenhals, Ammo’s chairman and CEO, commented that “[w]e believe the increase in production capacity at our state-of-the-art Wisconsin plant, coupled with the continuing enhancement rollout to the GunBroker.com Marketplace site, has positioned our Company to effectively navigate current market-wide headwinds resulting from the current inflationary and recessionary drivers impacting the consumer.

“We are primed to take hold of these opportunities. The addition of our newest executive management team member, Jared Smith, President & COO, supports the high level of confidence I have in Ammo’s future. Jared’s experience, the wealth of his relationships, intellect and drive are all valuable assets for our organization as we chart our path forward to a bright future through the balance of this fiscal year and beyond,” Wagenhals concluded.

Fourth Quarter and Fiscal Year 2023 Results
Ammo said, “We ended the Fiscal 2023 with cash generated from operations of approximately $35.6 million and a cash balance of $39.1 million. We were able to reduce our total inventories by $12.8 million in our fourth fiscal quarter as we shifted our direction to a leaner operating model focusing on higher margin classes of ammunition and increased brass sales, which also afford us higher margins. Additionally, we continue to push forward on the improvements to our Marketplace, GunBroker.com, and expect the payment suite and cart platform to launch in the first half of our 2024 fiscal year, which should drive growth and profitability to the site.

“We ended our fourth quarter with total revenues of approximately $43.7 million in comparison to approximately $70.1 million in the prior year quarter – this was a decrease of 37.7 percent from the prior-year quarter. For the fiscal year, total revenues were $191.4 million, decreasing 20.3 percent from the prior year. The decrease in revenue was mainly attributable to our ammunition segment and the inflationary impacts that are currently affecting the market. These market conditions also impacted the revenue of our Marketplace segment effecting a 7 percent decrease from the prior year quarter and a 2 percent decrease from the prior year in total. However, the operating performance of our Marketplace, GunBroker.com still remained strong and although our top-line revenues were slightly impacted, our margins are still comparable to historical performance.

“Our cost of revenues was approximately $31.8 million for the quarter compared to $49 million in the comparable prior-year quarter. The cost of revenues for the full fiscal year was $136 million compared to $151.5 million in the prior year. This decrease was related to reduced sales volume and increased commodity costs. Accordingly, this resulted in a gross margin of $11.9 million compared to $21.1 million in the prior year quarter and $55.4 million for the year compared to $88.8 in the prior fiscal year. As our sales volume fell in the reported period, our transition to more profitable sales activity is currently in effect for the first quarter of our 2024 fiscal year by shifting our focus to more sales of our premium brass and large-caliber ammunition rounds, all of which drive improved margin.

“Our balance sheet remains strong with our total current liabilities decreasing by 29 percent since our previous year-end and our total current assets virtually unchanged, but our cash position increased $15.8 million since the prior fiscal year or 68 percent.

“For the quarter, we recorded adjusted EBITDA of approximately $3.8 million, compared to prior year quarter adjusted EBITDA of $10.7 million. For our fiscal year, our adjusted EBITDA was $26.4 million compared to $60.8 million in the prior fiscal year.

“This resulted in a loss per share of $0.04 for the quarter or Adjusted Net Income per Share of $0.03 in comparison to a net income per share of $0.00 in the prior year quarter or Adjusted Net Income per Share of $0.07. For our fiscal year, a loss per share of $0.07 or Adjusted Net Income per Share of $0.16 in comparison to Net Income per share of $0.27 or Adjusted Net Income per Share of $0.46 in the prior year.”