Escalade Inc. reported net sales for the first quarter of 2019 were $32.1 million, coming in flat compared to the same quarter in 2018. Net income declined to $267,000, or 2 cents a share, from $1.2 million, or 8 cents, for the same quarter in 2018.
Gross margin ratio for the first quarter of 2019 was 26.4 percent, compared to 28.0 percent for the same period in the prior year. Gross profit for the first quarter of 2019 was $8.5 million compared to gross profit of $9.0 million for the same quarter in 2018.
Selling, general and administrative expenses (SG&A) were $7.7 million for the quarter compared to $7.0 million for the same period in the prior year, an increase of $0.7 million or 11.4 percent. SG&A, as a percent of sales, for the first quarter of 2019 increased to 24.1 percent from 21.6 percent reported for the same period prior year.
Operating income for the first quarter of 2019 was $0.4 million compared to operating income of $1.7 million for the same period in the prior year.
“In traditionally our softest quarter of the year, revenue was flat compared to the prior year, as continued growth in e-commerce and specialty dealers offset softer sales in the international and mass merchants channels,” stated Dave Fetherman, president and chief executive officer of Escalade, Inc. “Operating costs related to Victory Tailgate, during the slowest quarter of the year, negatively affected the margins within the quarter. Victory Tailgate has historically seen stronger results in the second and fourth quarters. SG&A spending increased due to non-recurring costs of new basketball displayers and we expect an increase in SG&A during the balance of 2019 to support additional revenue coming from Victory Tailgate. We completed the consolidation of Cue and Case’s operations from St. Augustine, FL into our distribution center in Evansville, IN during the quarter, which will provide on-going lease and transportation savings. With normal weather patterns returning this spring, we are anticipating an increase in sales in our Outdoor categories after an unusually cold and wet 2018.”
Escalade acquired Victory Tailgate, a brand known for its premium licensed and custom tailgating and lawn games last November for $7.2 million.
Headquartered in Evansville, IN, Escalade Sports’ brands include Bear Archery, Bear X, Trophy Ridge, Rocket, SIK and Cajun Bowfishing archery equipment; STIGA and Ping-Pong table tennis; Accudart and Unicorn darting; Atomic, Victory Tailgate, Triumph Sports, Viva Sol, Zume recreational games; Onix pickleball equipment; Goalrilla, Goalsetter residential in-ground basketball systems, Goaliath and Silverback residential in-ground and portable basketball goals; Lifeline and the STEP fitness products; Woodplay premium playsets; Vuly trampolines; and Cue&Case – a leader in specialty billiard accessories.