Remington Outdoor Company Inc. reported sales increased 7.0 percent in 2016 to $865.1 million from $808.9 million in 2015.
Firearms sales for the year ended December 31, 2016 were $437.8 million, an increase of 16.7 percent, as compared to the year ended December 31, 2015. MSR sales increased $34.2 million and shotgun sales increased $16.5 million. Sales of handguns and centerfire rifles increased by $14.0 million and $1.7 million, respectively, and accrued discounts were lower by $0.2 million. These increases were partially offset by lower sales of rimfire rifles of $4.0 million. These increases were primarily due both to increased MSR sales prior to the presidential election and its new handgun product launches.
Ammunition sales were $357.7 million, an increase of 0.6 percent. Sales of centerfire ammunition increased $13.5 million, while sales of shotshell ammunition increased $8.4 million. These increases were partially offset by decreased sales of rimfire ammunition of $9.7 million and decreased sales of other ammunition products and higher accrued discounts of $10.2 million. These changes were primarily driven by increased demand for shooting versus hunting caliber ammunition and promotional products.
Net sales were $69.6 million in its Consumer businesses for the year ended December 31, 2016, a decrease of $8.4 million, or 10.7 percent, as compared to the prior-year period. The decrease was primarily due to lower sales of accessories of $11.7 million associated with the divesture of Remington UK and Mountain Khakis, partially offset by higher sales of after-market parts of $3.3 million.
Gross margins improved to 25.5 percent of sales from 23.6 percent. The improvement was due to a climb in firearm’s gross margins to 23.8 percent from 21.4 percent. The increase was due to favorable pricing and lower manufacturing costs.
Operating expenses were reduced to 16.1 percent of sales from 25.3 percent a year ago.
Operating income reached $81.5 million against a loss of $13.9 million a year ago. Net income was $18.9 million against a net loss of $135.2 million in 2015.
Nonrecurring charges of $8.1 million for the year ended December 31, 2016 consisted primarily of $2.6 million of restructuring charges related to the closure of its Mayfield production facility, $2.4 million in other non-recurring fees, $1.8 million of employee related costs, $0.9 million in bank fees and $0.4 million in litigation an lawsuit matters.
Nonrecurring charges of $38.5 million for the year ended December 31, 2015 consisted primarily of $17.7 million of restructuring charges and start-up costs, $10.3 million of employee related costs, $5.3 million in litigation and lawsuit matters, $2.4 million in project and consulting fees, $1.0 million in bank fees, $0.9 million of relocation costs and related tax gross up and a $0.8 million loss on the sale of a subsidiary.
Photo courtesy Remington
