Axil Brands Posts Strong FY Growth, or How to Survive on 73 Percent Gross Margins

Axil Brand, Inc., is an emerging global e-commerce consumer products company listed on the American NYSE. The company manufactures and markets hearing enhancement and protection products for the sporting goods and shooting sports markets under the Axil and Sig Sauer brand names.

The company reported that consolidated net sales for its fiscal year ended May 31, 2024 increased 17 percent to a record $27.5 million compared to $23.5 million in the prior year, primarily due to the increase in marketing and sales initiatives in the company’s hearing protection and enhancement segment.

“We are making continued progress in areas that should contribute to our sustainable, long-term growth and profitability. The impressive results underscore our team’s relentless dedication and the successful execution of our strategic initiatives,” commented Jeff Toghraie, chairman and CEO of Axil Brands, Inc. “For 2025, our strategic initiatives are geared towards enhancing our global presence, fostering strategic partnerships and adapting our offerings to meet diverse market needs. This emphasis on international expansion not only broadens our market reach but also strengthens our competitive position on the global stage, in our view, driving sustainable growth and maximizing our potential for success in new and dynamic markets.”

Gross margin was 73.4 percent of sales for the fiscal year, compared to 75.3 percent for the prior year. The decrease in gross margins was said to be primarily attributable to costs associated with expansion into new retail and distribution channels.

Operating expenses amounted to $18.7 million for the fiscal year, compared to $15.7 million in the prior year.

Operating margins were 68.0 percent for the fiscal year, up 110 basis points compared to 66.9 percent for fiscal year 2023. The company said the improvement, despite higher marketing and selling expenses, increased compensation and a rise in general and administrative expenses, including expenses associated with the company’s listing on the NYSE American exchange.

Net income rose to $2.0 million, or 21 cents per diluted share, for the fiscal year, compared to a net income of $1.8 million, or 10 cents per diluted share, in the 2023 fiscal year. EPS for 2024 included an 8 cents per share gain on redemption of preferred shares.

“We concluded the fiscal year with record revenues of $27.5 million, reflecting a solid 17 percent year-over-year growth, largely driven by our strategic focus on expanding distribution and retail channels,” remarked Jeff Brown, CFO of Axil Brands. “Maintaining the quality of our revenue is a key priority this year as we focus on optimizing our existing partnerships and establishing new ones. There was no single customer that accounted for greater than 10 percent of total sales in our hearing protection and enhancement segment which accounted for approximately 95 percent of our total revenue for fiscal year 2024.”

Image courtesy Axil Brands, Inc.