Brunswick Corporation looked to its Marine and Fitness Equipment divisions to post a 22.9% increase in revenues to $1.27 billion for the third quarter from $1.04 billion in Q3 last year. However, the Fitness division, which includes the Life Fitness, Hammer Strength and ParaBody fitness equipment brands and operates the Omni Fitness retail stores, continued to be a drag on operating income for the quarter. The Marine and Bowling & Billiards divisions posted strong operating profits to boost net income 92.3% to $72.9 million versus $37.9 million in the year-ago period.
Fitness Segment sales increased 25.8% in the quarter to reach $132.2 million, versus $105.1 million in the year-ago period, thanks to continued to sales momentum at Life Fitness, with gains in the commercial segment driven by the success of new strength products and increased sales to the military. However, operating earnings declined 3.4% for the period to $8.4 million compared with $8.7 million in the third quarter of 2003, due primarily to “significantly higher steel prices”, a competitive pricing in Europe, and a shift in product mix towards lower margin, strength equipment.
The Bowling & Billiards Segment, which includes results from the Brunswick retail bowling centers and bowling equipment, as well billiards, Air Hockey and foosball tables, saw sales increase 9.3% to $106.6 million, compared with $97.5 million in the year-ago quarter.
Bowling sales were up double-digits, helped by the new Vector scoring system and new bowling balls, like the Inferno. Operating earnings jumped to $4.0 million in Q3 versus approximately $100,000 in Q3 2003.
Marine Segment sales were up 24.2% to $1.04 billion in the quarter versus $833.8 million in Q3 last year, while and operating earnings increased 54.6% to $106.8 million versus $69.1 million in Q3 last year.
Based on the YTD performance, Brunswick again increased EPS guidance for the year to $2.70 to $2.75 per share from a previous estimate of $2.60 to $2.68 per share. The new estimate includes approximately 10 cents per share related to the completion of a four-year tax return audit.