Johnson Outdoors reported lower sales and earnings for its third quarter, albeit with double-digit growth in profitability for the company’s fishing and watercraft recreation businesses.
During the fiscal nine-month period that ended July 1, company sales increased 4 percent and earnings rose 67 percent from the same period a year earlier.
"We are very pleased by the performance of our fishing and watercraft recreation businesses, where our brands are gaining share in highly competitive marketplace environments on the strength of new product success,” chairman and CEO Helen Johnson-Leipold said in a statement.
“We look to continue this positive momentum with the revolutionary Minn Kota Ultrex trolling motor, Humminbird Helix 10 fishfinder and Old Town Predator PDL pedal fishing kayak, each of which grabbed the top award in its category at last month's ICAST, the world's largest and most prestigious trade and consumer fishing show.”
Net sales for the full company were $139.3 million during the quarter, compared with $140.9 million in the previous year’s quarter. Total company operating profit for the quarter was $13.6 million, compared with $16.4 million a year earlier.
Net income for the quarter was $6.8 million, or 68 cents a diluted share, compared with $10 million, or $1 a share, a year earlier.
The company said reduced cash flow projections in diving, prompted by ongoing geopolitical and economic turmoil in key dive markets in the Middle East and Europe, triggered a re-evaluation of the unit's intangible assets under ASC 350, resulting in non-cash goodwill impairment charges of $6.2 million in the unit during the third quarter.
Foreign currency translation had a 0.3 percent unfavorable impact on sales, compared with the prior-year quarter, the company said.
"Our strategic plan priorities focus on delivering long-term profitable growth for all our brands,” Johnson-Leipold said. “In diving, historically one of our most profitable businesses, the goal is sustained innovation to drive share growth, and we acquired Seabear to accelerate the pace of new product development for Scubapro. In camping, Jetboil continues to exceed expectations, and we are repositioning the iconic Eureka! brand for future success in new emerging camp consumer targets."
Strong marketplace momentum around new products across the company's consumer fishing, outdoor cooking and watercraft recreation brands drove year-to-date sales for the nine-month period to $358.8 million, 4 percent ahead of sales in the prior-year period.