The Vista Outdoor boardroom where all the important company decisions are made, allegedly. (Photo: VSTO)
Vista Outdoor sales dipped 10 percent in its first quarter, the company’s top executives reported in financial filings this week.
Interim CEO Michael Callahan told investors Thursday he remains “pleased” with the earnings for the quarter — which ended July 1 — and thinks, despite ongoing inventory challenges, “point-of-sale data indicates the recreational shooter is out there and active.”
Vista owns more than three dozen companies in firearms, ammunition and shooting accessory companies, including Savage Arms, Stevens, Federal Premium, Speer and American Eagle.
“I’ve been in the industry for more than 40 years and this is the most unique retail environment I’ve ever seen,” Callahan said. “We’re seeing unprecedented change and it’s not likely to go back.”
Vista recorded $14 million in profit for the quarter, nosediving 54 percent over last year. The company’s $279 million in shooting sports sales comes in 19 percent behind last year — a result of “lower demand across all product lines,” said Chief Financial Officer Stephen Nolan Thursday.
“The markdowns remain challenging, however, we are seeing promising signs,” he said, noting inventory levels of ammo appear to be normalizing.
The overstock of firearms and other shooting products stockpiled before the election, however, could hang around until Vista’s fiscal fourth quarter, Nolan said.
“As we look into the fall hunting season, we’re seeing some encouraging signs there and we’re feeling much better about that,” Callahan said. “But we continue to believe that both inventories and promotional activity is going to be continued through the holiday selling season and perhaps beyond that.”
Callahan stepped into the role of Vista’s interim CEO after longtime president Mark DeYoung announced his early retirement last month — a role he says he is “excited to take on” while the company’s board of directors search for a permanent replacement.
“Despite current market conditions, the Board and I are confident that our diversified portfolio of iconic brands, coupled with Vista Outdoor’s world-class operations and strong customer relationships position the company for long-term success,” he told investors Thursday, reiterating his former boss’s optimism about a rebounding industry.
“So, we have some headwinds and we’re going to continue to face challenges,” he said. “But we are comfortable that given where we’re at today and our approach to this new market that we’re going to be able to achieve our results.”
The company anticipates 2018 sales will exceed $2.3 billion.
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