Sturm, Ruger & Company Inc. reported earnings fell in the second quarter ended June 29 as sales slid 8.4 percent. Sales in the quarter reached $130.8 million compared with $142.8 million in the year-ago period. Net income fell 48.9 percent to $8.3 million, or 47 cents a share, from $16.2 million, or 91 cents a year ago.

For the six months, net sales were $267.6 million, down 8.5 percent from $292.3 million a year ago. Earnings fell 49.7 percent to $15.3 million, or 87 cents, from $30.5 million, or $1.72, a year ago.

Company CEO Christopher J. Killoy stated, “Although consumer demand in the firearms market declined from the second quarter of last year, the estimated sell-through of our products from our independent distributors to retailers bucked this trend and increased during the same period.”

Killoy said the growth was primarily driven by the demand for recently introduced products, including the American Rifle Generation II family of rifles, Marlin lever-action rifles, including the 1895 Dark Series and the 336 models, LC Carbine chambered in .45 Auto, 75th Anniversary Mark IV Target pistol, 75th Anniversary 10/22 rifles, 75th Anniversary LCP MAX pistol, and Mini-14 rifle with side-folding stock.

Killoy continued, “Earlier this year, we reorganized some aspects of our business and reduced force to achieve greater efficiency, productivity and flexibility throughout our organization. We are starting to realize the benefits of these actions. Despite a reduction in headcount, second-quarter production increased 18 percent from the first quarter. We expect further improvements from the initiatives we are currently pursuing and we continue to look for additional opportunities to reduce or eliminate inefficiencies in every part of our business.”

Killoy concluded, “We remain focused on the long-term goal of creating shareholder value. Our disciplined pricing and promotion strategy may not always benefit current period sales and profitability but instead enhances our long-term performance and promotes consistency throughout the distribution channel. Allowing both independent distributors and retailers to confidently invest in our inventory is essential to Ruger’s long-term success and leadership in the volatile firearms market. We continue to leverage our strong, debt-free balance sheet. In the first half of 2024, we repurchased 477,917 shares of our stock at an average cost of $42.41 per share, representing approximately 3 percent of our outstanding shares.”

Killoy made the following observations related to the company’s second-quarter 2024 performance:

  • The estimated unit sell-through of the company’s products from the independent distributors to retailers increased by one percent in the second quarter and the first half of 2024 compared to the prior year periods. For the same periods, NICS background checks, as adjusted by the National Shooting Sports Foundation, decreased 8 percent and 6 percent, respectively.
  • Sales of new products, including the Security-380 pistol, Super Wrangler revolver, Marlin lever action rifles, LC Carbine, Small-Frame Autoloading Rifle, and American Centerfire Rifle Generation II represented $79.7 million or 31 percent of firearm sales in the first half of 2024, an increase from $63.3 million or 23 percent of sales in the first half of 2023. New product sales include only major new products introduced in the past two years.
  • Profitability in the second quarter of 2024 improved from the first quarter of 2024 as Ruger increased production despite the reduction in headcount.
  • Compared to the second quarter of 2023, the company’s and distributor’s finished goods inventories have been reduced by 13,300 units and 88,700 units, respectively, providing an opportunity for replenishment in the second half of the year.
  • Cash provided by operations during the first half of 2024 was $26.1 million. At June 29, 2024, Ruger’s cash and short-term investments totaled $105.6 million. Ruger’s current ratio is 4.8 to 1 and Ruger has no debt.
  • In the first half of 2024, capital expenditures totaled $10.4 million in new product introductions, upgrades to Ruger’s manufacturing equipment and facilities. Ruger expects its 2024 capital expenditures to approximate $20 million.
  • In the first half of 2024, the company returned $27.1 million to its shareholders by paying $6.8 million in quarterly dividends and repurchasing $20.3 million worth of shares of its common stock in the open market.
  • At June 29, 2024, stockholders’ equity was $321.5 million, which equates to a book value of $18.90 per share, of which $6.21 per share was cash and short-term investments.