By Thomas J. Ryan
Helped by strong demand for modern sporting rifles (MSRs) and a rebound in ammunition sales, Remington Outdoor Co. reported revenues advanced 11.4 percent in the third quarter ended September 25, to $221.7 million.
The company, which is privately held but still issues quarterly reports, is parent to Remington, Bushmaster Firearms, DPMS/Panther Arms, Marlin, H&R, The Parker Gun, Advanced Armament Corp., Dakota Arms, Para USA and Barnes Bullets.
In the firearms segment, sales rose 14.8 percent, to $110.2 million. Sales of shotguns, centerfire rifles and handguns increased by $8.3 million, $8.1 million and $6.8 million, respectively. Increases in the firearms segment categories were partially offset by decreased sales of rimfire ammunition and other ammunition products of $1.6 million and $3.8 million, respectively. Remington said demand for MSRs continues be strong, especially in the opening-price-point segments. Handgun demand is particularly being seen in the polymer pistol, subcompact and micro pistol categories.
Ammunition sales increased 13.6 percent to $93.2 million. Sales of centerfire ammunition and shotshell ammunition increased $12 million and $4.6 million, respectively. These increases were partially offset by decreased sales of rimfire ammunition and other ammunition products of $1.6 million and $3.8 million, respectively. Remington said the ammunition segment’s rebound followed softness experienced in recent quarters. Customers continue to shift toward value target and range ammunition.
In the consumer segment, sales increased 15.1 percent, to $18.3 million. The increase was primarily due to higher sales of after-market parts of $6.1 million, partially offset by lower accessories sales of $3.7 million. The segment includes accessories, silencers, other gun-related products, licensed products and lifestyle products, including apparel and pet accessories.
Earnings reached $9.5 million for the quarter, rebounding from a loss of $11 million a year ago. The bottom line benefited from an improvement in gross margins to 27.3 percent, from 22.9 percent a year ago. Beyond the greater sales volumes, the improvement was attributed to process improvements and fewer disruptions at its plants, as well as favorable pricing in its firearm segment. SG&A expenses were slashed to 14 percent of sales from 20.7 percent, due to efforts to reduce spending, restructuring and fewer non-recurring items. The latest quarter included a charge of $2.3 million related to the closing of its Mayfield, KY firearms production facility. Production at this facility will be consolidated into the company’s Huntsville, AL facility.
Remington Outdoor’s report also noted that on October 14, it sold substantially all of the assets of its subsidiary, Remington UK, for $3.4 million.
Photo courtesy Remington Arms
