Olin Corporation reported sales in its Winchester ammunition segment grew 14.7 percent in the fourth quarter, and Olin officials expect an uptick in hunt participation over the last two years to continue to drive growth in the quarters ahead.

Asked about the outlook for volume growth at Winchester on Olin’s fourth-quarter conference call, Scott Sutton, Olin’s president and CEO, said, “Of course, volume is solid in the Winchester business, and we have certainly a heavy commercial backlog already.”

However, Sutton also noted that Winchester, in November, launched its Shoot United initiative to encourage newer firearm owners over the past two years to remain engaged in recreational shooting activities that they may have discovered during the pandemic.

Said Sutton, “If you look at what happened in 2020, there are effectively eight million new shooters added to the roles. And if you look at what happened in 2021, there were nearly six million new shooters added to the roles. So now we’re up around 60 million people in this country enjoying the sport, and it’s one of the fastest-growing high school sports in the country. What we’re going to do is go out and grow participation.”

He added, “We expect volume to stay strong. I won’t say that we’ll have large multiples of volume expansion because we’re running pretty hard in that business already.”

Asked about pricing, Sutton said Winchester had another price increase planned for the first quarter. He added, “A lot of that will go to offsetting some cost increases that we do have, especially across our metal’s portfolio.”

In the quarter, the sales gain of 14.7 percent represented a slowdown from recent quarters as Winchester started to anniversary sizeable gains in the year-ago period that were, in part, due to increased interest in outdoor activities such as target shooting and hunting, but also due to the civil unrest in 2021.

Winchester’s sales grew 93.8 percent in the third quarter of 2021, 109.8 in the second quarter and 107.0 in the first quarter. Sales first began surging in 2020 fourth quarter when sales catapulted 120.4 percent.

Olin said the increase in sales was primarily due to higher commercial ammunition pricing.

Fourth-quarter 2021 segment earnings were $101.8 million compared to $44.8 million in the fourth quarter of 2020. The $57.0 million increase in segment earnings was primarily due to higher commercial ammunition pricing, partially offset by higher commodity and other materials costs. Winchester’s fourth-quarter 2021 results included depreciation and amortization expense of $6.5 million compared to $5.4 million in the fourth quarter 2020.

Compared to the third quarter of 2021, sales were down 2 percent and adjusted EBITDA was off 10 percent. The sales dip reflects seasonally lower commercial and lower military sales, and the sequential profit decline reflects higher commodity and operating costs.

In the year, Winchester’s sales reached $1,583.8 million against $927.6 million a year ago, a gain of 70.7 percent. Operating income in the nears increased four-fold to $412.1 million from $92.3 million a year ago.

The growth for the year reflects the addition of Lake City operations beginning October 1, 2020.

Companywide, sales for Olin, which also owns chemical businesses, were $2,430.4 million compared to $1,654.1 million in the fourth quarter of 2020.

Fourth-quarter 2021 reported net income was $306.6 million, or $1.89 per share, which compares to fourth quarter 2020 reported net loss of $33.0 million, or 21 cents, a year ago. Results were in line with guidance.

Full-year 2021 reported net income was $1,296.7 million, or $7.96 per diluted share, which compares to the full-year 2020 reported net loss of $969.9 million, or ($6.14) per diluted share. Total sales in the year were $8,910.6 million against $5,758.0 million in 2020.

Photo courtesy Winchester/Shoot United