Sturm, Ruger & Company, Inc. reported sales in the second quarter fell 11% to $64.4 million from $72.4 million a year ago. Earnings slid 5.7% to $8.2 million, or 43 cents a share, from $8.7 million, or 46 cents, a year earlier.
For the six months ended July 3, 2010, net sales were $132.7 million and earnings were 86¢ per share. For the corresponding period in 2009, net sales were $135.9 million and earnings were 76¢ per share.
Chief Executive Officer Michael O. Fifer made the following comments related to the company's results of 2010:
* New product introductions remain a strong driver of demand and represented $42 million, or 32% of sales, in the first six months of 2010.
* The estimated sell-through of the company's products from distributors to retailers in the first half of 2010 increased 1% from the first half of 2009, despite a reduction in National Instant Criminal Background Check System (NICS) background checks of 2% during this period.
* Cash generated from operations during the first half of 2010 was $17.8 million. At the end of the second quarter of 2010, our cash and equivalents totaled $58.7 million. Our current ratio is 4.0 to 1 and we have no debt.
* During the first half of 2010, capital expenditures totaled $12.6 million, much of it related to tooling and equipment for new products. We expect to invest approximately $18 to $20 million for capital expenditures during 2010.
* At the end of the second quarter of 2010, stockholders' equity was $109 million, which equates to a book value of $5.68 per share, of which $3.05 per share was cash and equivalents.
* For the third consecutive year, a Ruger handgun has been named the Shooting Industry Academy of Excellence “Handgun of the Year”. The Ruger SR9c is the compact version of the SR9 striker-fired pistol, one of the slimmest and most ergonomic 9mm pistols on the market today.
The company also announced today that its Board of Directors declared a
dividend of 10 cents per share for the second quarter, for shareholders
of record as of August 13, 2010, payable on August 27, 2010. The amount
of the dividend was based on a percentage of Operating Profit after
adjustment for certain items, the same approach used by the company
since 2009. Under this approach, the amount of the quarterly dividend
fluctuates directly with certain operating results of the company.
Three Months Ended |
Six Months Ended |
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July 3, 2010 |
July 4, 2009 |
July 3, 2010 |
July 4, 2009 |
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Net firearms sales |
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$63,621 |
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$71,372 |
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$130,891 |
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$133,600 |
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Net castings sales |
768 |
1,018 |
1,775 |
2,320 |
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Total net sales |
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64,389 |
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72,390 |
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132,666 |
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135,920 |
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Cost of products sold |
42,649 |
47,358 |
87,794 |
91,362 |
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Gross profit |
21,740 |
25,032 |
44,872 |
44,558 |
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Expenses: |
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Selling |
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5,118 |
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5,319 |
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11,017 |
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10,764 |
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General and administrative |
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3,984 |
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5,563 |
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7,919 |
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9,709 |
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Other operating expenses, net |
– |
175 |
398 |
675 |
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Total operating expenses |
9,102 |
11,057 |
19,334 |
21,148 |
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Operating income |
12,638 |
13,975 |
25,538 |
23,410 |
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Other income: |
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Interest (expense) income, net |
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(24 |
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39 |
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(57 |
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(40 |
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Other income (expense), net |
174 |
(14 |
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301 |
(4 |
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Total other income (expense), net |
150 |
25 |
244 |
(44 |
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Income before income taxes |
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12,788 |
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