Escalade Inc. reported revenues for the third quarter were up 9 percent over the same quarter in the prior year due to incremental sales from acquisitions closed during the past year.
Year to date revenues have increased 15 percent over the same period in the prior year due to organic growth and acquisitions. The Company generated net income from continuing operations for the quarter of $2.0 million, or $0.14 diluted earnings per share compared to net income from continuing operations of $3.8 million or $0.27 diluted earnings per share for the same quarter in 2014. For the first nine months of 2015, net income from continuing operations was $8.7 million or $0.61 diluted earnings per share, while the first nine months of 2014 showed net income from continuing operations of $8.9 million with $0.63 diluted earnings per share.
Gross margin ratio from continuing operations for the third quarter of 2015 declined from the same period in 2014 due to decreased sales and margins in archery and increased research and development spending on new products. Selling, general and administrative expenses (SG&A) were $6.9 million for the third quarter of 2015 compared to $4.9 million for the same period in 2014, an increase of $2.0 million or 41 percent. The increase in SG&A is primarily due to increased operating costs related to acquisitions, timing of selling and administration expenditures, marketing efforts in new categories acquired during 2014 and expenditures in new products to be introduced in late 2015 and 2016.
Net income from continuing operations was adversely impacted by foreign currency exchange rates associated with our 50 percent ownership of Stiga, headquartered in Sweden.
“We continue to make strategic investments in acquisitions, including the previously announced purchases of Onix Sports, Inc. and Goalsetter Systems, Inc. during the third quarter” stated Robert J. Keller, president and chief executive officer of Escalade, Inc. “We remain confident in our strategy to grow our sports and outdoor recreation equipment business through internal innovation and acquisitions, while maintaining a strong balance sheet and dividend for our shareholders.”
Recent acquisitions include Onix Sports, the maker of paddles, balls, sportswear and accessories for the sport of pickleball, in late July; Cue & Case Sales, a leader in specialty billiard accessories, in October 2014; and DMI Sports, which makes indoor games and accessories for darts, table tennis, game tables and billiards.
Its other brands include Stiga and Ping-Pong table tennis, Accudart and Unicorn darting; Goalrilla, Goaliath and Silverback sports training equipment and basketball goal systems; and Bear Archery, Trophy Ridge and Cajun Bowfishing hunting products.
