Easton-Bell Reports 9% Spike in Q4 Revenues

 

For fiscal 2008, net sales increased $50.9 million, or 7.0%, to $775.5 million, as compared to $724.6 million for fiscal 2007.

 
Team Sports net sales increased $4.7 million, or 5.6%, for the fourth quarter of fiscal 2008, as compared to the fourth quarter of fiscal 2007.

 

For fiscal 2008, Team Sports net sales increased $17.2 million, or 4.1% as compared to fiscal 2007. The increase in Team Sports net sales during the fourth quarter related to increased sales of baseball and softball products and football helmets and reconditioning services. For fiscal 2008, the Team Sports net sales increase was due to increased sales of baseball and softball products, ice hockey equipment and football helmets and reconditioning services.

Action Sports net sales increased $9.4 million, or 13.1% for the fourth quarter of fiscal 2008, as compared to the fourth quarter of fiscal 2007. For fiscal 2008, Action Sports net sales increased $33.7 million, or 10.9%, as compared to fiscal 2007.

 

The increase in Action Sports net sales for both periods was due to increased sales of cycling helmets and accessories in both the Mass and Specialty channels and increased sales of snow sports and powersports helmets and eyewear in the Specialty channel.

The company's adjusted EBITDA of $12.5 million for the fourth quarter of fiscal 2008 increased $4.8 million, or 62.4% as compared to $7.7 million of Adjusted EBITDA in the fourth quarter of fiscal 2007.

 

For fiscal 2008, Adjusted EBITDA was $105.6 million, as compared to $96.9 million for fiscal 2007, an increase of $8.7 million, or 9.0%.

 

“We are pleased with our fourth quarter results in a difficult economic environment and our ability to grow sales, profits and cash flow throughout 2008. As we move into 2009, key areas of focus will be to increase market share for the brands in our portfolio, control expenses and aggressively manage working capital,” said Paul Harrington, Easton-Bell Sports, Inc. President and CEO.

 

The company's net income for fiscal 2008 was $13.4 million, as compared to $14.5 million of net income for fiscal 2007. The decrease in net income is primarily due to an increase in selling, general and administrative expenses related to spending on research and development, information technology and employee compensation, along with increased income tax expense and fiscal 2007 benefiting from a gain on the sale of property, plant and equipment, all of which were partially offset by sales growth.

Balance Sheet Items

Net debt totaled $414.6 million (total debt of $455.9 million less cash of $41.3 million) as of Jan. 3, 2009, a decrease of $44.1 million, or 9.7% over such amount at Dec. 29, 2007. The reduction in net debt is due to an increase in cash of $24.4 million, a decrease in debt and capital lease obligations of $14.2 million and a decrease in revolver borrowings of $5.5 million.

 

Working capital as of Jan. 3, 2009 was $282.9 million, as compared to $262.8 million as of Dec. 29, 2007, with the increase primarily due to the positive results related to sales growth on the components of working capital.