Sturm, Ruger & Company, Inc. reported net sales of $155.9 million
and fully diluted earnings of $1.20 per share, compared with net sales
of $112.3 million and fully diluted earnings of 79¢ per share in the
first quarter of 2012.



The Company also announced today that its Board of Directors declared a
dividend of 49¢ per share for the first quarter, for shareholders of
record as of May 10, 2013, payable on May 24, 2013. This dividend varies
every quarter because the Company pays a percent of earnings rather than
a fixed amount per share. This dividend is approximately 40% of net
income.



Chief Executive Officer Michael O. Fifer made the following observations
related to the Companys results:



  • Our earnings increased 53% from the first quarter of 2012, driven by
    the 39% growth in sales and our ongoing focus on continuous
    improvement in our operations.

  • New product introductions were a significant component of our sales
    growth as new product sales represented $53.3 million or 35% of
    firearm sales in the first quarter of 2013. New product introductions
    in the first quarter of 2013 included the LC380 pistol and the SR45
    pistol.

  • The estimated sell-through of our products from independent
    distributors to retailers in the first quarter of 2013 increased 12%
    from the first quarter of 2012. This estimated unit sell-through was
    effectively limited to first quarter production because distributor
    inventory totaled only 59,200 units at December 31, 2012. For
    reference, at December 31, 2011, the distributor inventory totaled
    135,600 units, allowing Q1 2012 sell-through to exceed Q1 2012
    production by 22%. During the first quarter of 2013, National Instant
    Criminal Background Check System (NICS) background checks (as
    adjusted by the National Shooting Sports Foundation) increased 46%.

  • Cash generated from operations during the first quarter of 2013 was
    $30.4 million. At March 30, 2013, our cash and cash equivalents
    totaled $45.6 million. Our current ratio is 1.6 to 1 and we have no
    debt.

  • In the first quarter of 2013, capital expenditures totaled $7.7
    million, much of it related to new products and the expansion of
    production capacity. We expect to invest approximately $30 million for
    capital expenditures during 2013.

  • In the first quarter of 2013, the Company returned $7.8 million to its
    shareholders through the payment of dividends.

  • At March 30, 2013, stockholders equity was $111.6 million, which
    equates to a book value of $5.78 per share, of which $2.36 per share
    was cash and equivalents.
STURM, RUGER & COMPANY, INC.

 

CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)

(In thousands, except per share data)



 


 

 

Three Months Ended



March 30, 2013

 

March 31, 2012




 






 

Net firearms sales


$

153,440



$

110,787


Net castings sales

 

 

2,465

 

 

 

1,550

 

Total net sales



155,905




112,337






 

Cost of products sold



94,596




70,544


 

 

 

 

 

Gross profit

 

 

61,309

 

 

 

41,793

 





 

Operating expenses:





Selling



15,764




10,999


General and administrative

 

 

8,443

 

 

 

6,378

 

Total operating expenses

 

 

24,207

 

 

 

17,377

 





 

Operating income

 

 

37,102

 

 

 

24,416

 





 

Other income:





Interest expense, net



(16

)



(23

)

Other income, net

 

 

265

 

 

 

178

 

Total other income, net

 

 

249

 

 

 

155

 





 

Income before income taxes



37,351




24,571






 

Income taxes

 

 

13,633

 

 

 

9,091

 





 

Net income and comprehensive income

 

$

23,718

 

 

$

15,480

 





 

Basic earnings per share

 

$

1.23

 

 

$

0.81

 





 

Fully diluted earnings per share

 

$

1.20

 

 

$

0.79

 





 

Cash dividends per share

 

$

0.404

 

 

$

0.212