Johnson Outdoors Inc. reported earnings surged nearly five-fold in the fiscal third quarter ended June 27 with the benefit of reduced discounting and higher sales. Sales grew 5 percent in the second quarter as gains in its Fishing and Diving segments. Sales in the Camping & Watercraft Recreation segment grew 3 percent excluding the impact of the exit from the Eureka! business.
“While the marketplace continues to fluctuate, this quarter’s positive results emphasize the importance of our focus and investment on delivering market-winning innovation,” said Helen Johnson-Leipold, chairman and chief executive officer. “Importantly, we continue to make progress against our strategic priorities—innovation, digital and ecommerce, and operational efficiency—which are critical to achieving our goal of delivering future healthy profitable growth.”
Third Quarter Results
Total company net sales in the third quarter increased 5 percent to $180.7 million compared to $172.5 million in the prior year third fiscal quarter.
Fishing revenue increased 8 percent due to continued success of new products
Camping & Watercraft Recreation sales were down 14 percent, primarily due to the exit of the Eureka! Business. Excluding the impact of the Eureka! sales in the prior year quarter, sales would have improved 3 percent year over year
Diving showed a 7 percent increase in revenue due to stronger market conditions and favorable currency translation which had a 2 percent positive impact on sales
Total company operating profit was $7.3 million for the third fiscal quarter versus operating loss of $0.5 million in the prior year third quarter. Gross margin improved to 37.6 percent, compared to 35.8 percent in the prior year quarter, primarily due to improved overhead absorption driven by higher sales volumes in addition to lower discounting of product in the current year quarter. Operating expenses of $60.6 million decreased $1.7 million from the prior year period, due primarily to lower promotions and professional services expense, partially offset by increased expense on the company’s deferred compensation plan.
Profit before income taxes was $10.5 million in the current year quarter, compared to $0.9 million in the prior year third quarter. In addition to the improvement in operating profit noted above, there was an increase in Other Income of approximately $2.0 million due primarily to an increase in earnings on the company’s deferred compensation plan. Net income was $7.7 million, or 75 cents per diluted share, versus $1.6 million, or 16 cents per diluted share in the previous year’s third quarter. The effective tax rate was an expense of 26.3 percent compared to a benefit of 78.8 percent in the prior year third quarter.
Year-To-Date Results
Fiscal 2025 year-to-date net sales were $456.7 million, a 6.2 percent decrease over last year’s first fiscal nine-month period. Total company operating loss declined to $8.0 million, compared to a loss of $0.7 million in the prior fiscal year-to-date period. Gross margin decreased slightly to 34.8 percent, compared to 36.2 percent in the prior year-to-date period. Operating expenses were $167.0 million in the nine-month period ending June 27, 2025, a decrease of $9.8 million from the prior year due to the same factors noted above for the quarter.
Loss before income taxes for the year-to-date period was $4.3 million, versus profit before income taxes of $9.8 million in the first nine months of the prior year. In addition to the decline in operating profit, Other Income decreased by $6.2 million, primarily due to a decrease in earnings on the company’s deferred compensation plan of approximately $3.9 million. In addition, the prior year-to-date period included a gain on the sale of the building of approximately $1.9 million. Net loss during the first fiscal nine months was $5.2 million, or 52 cents per diluted share, versus net income of $7.7 million, or 75 cents per diluted share, in the prior fiscal year-to-date period. The company’s effective tax rate was a tax benefit of 22.8 percent in the current year versus a tax expense of 21.2 percent in the prior year nine-month period.
Other Financial Information
The company reported cash and short-term investments of $161.0 million as of June 27, 2025, versus $148.4 million at June 28, 2024. Depreciation and amortization were $15.3 million in the nine months ending June 27, 2025, compared to $14.8 million in the prior nine-month period. Capital spending totaled $11.8 million in the current quarter compared with $16.4 million in the prior year period. In June 2025, the company’s Board of Directors approved a quarterly cash dividend to shareholders of record as of July 10, 2025, which was payable July 24, 2025.
“We continue to benefit from our ongoing focus on improved operational efficiency, helping us to strengthen margins and effectively manage working capital. While the tariff environment remains uncertain, we continue to work through short- and long-term strategies to mitigate the potential increases in costs. Our focus is on ending the year with our brands well-positioned for the future,” said David W. Johnson, chief financial officer.
Image courtesy Johnson Outdoors
