EVANSVILLE, Ind., April 20, 2017 /PRNewswire/ -- Escalade, Incorporated (NASDAQ: ESCA) - "With the first quarter of 2017 completed, the retail atmosphere continues to evolve," stated Dave Fetherman, President and Chief Executive Officer of Escalade, Inc. "Consumer buying preferences continue to shift to on-line purchasing. Our focus on this consumer shift over the last few years puts us in great position to support our e-commerce and brick-and-mortar retail partners. Revenue was down in the first quarter, compared to prior year, due to retail bankruptcy liquidations, as well as going up against portable basketball pipeline fills from a year ago. Gross margins were impacted as material prices rose as well as a shift within our product mix. We will continue to invest in internally developed product and strategic acquisitions for growth, while remaining focused on controlling operating expenses to maximize shareholder value."

Net sales for the first quarter of 2017 were $30.8 million compared to net sales of $34.6 million for the same quarter in 2016.

Gross margin ratio decreased to 27% for the first three months of 2017, compared to 32% for the same period in the prior year.

Selling, general and administrative expenses (SG&A) were $5.9 million for the first three months in 2017 compared to $7.8 million for the same period in the prior year, a decrease of $1.8 million or 24%.  SG&A as a percent of sales is 19% for the first three months in 2017 compared with 23% for the same period in the prior year.  The decrease in SG&A is primarily due to one-time costs associated with bad debt expenses incurred related to The Sports Authority's bankruptcy filing in 2016 and increased marketing and selling expenses related to new products introduced in 2016.

Other income for the first quarter of 2017 increased due to the recognition of a gain on bargain purchase from an acquisition completed during the quarter. This increase was partially offset due to an adverse impact from the operating results of the Company's 50% ownership in STIGA, a Swedish entity.

Net income for the first quarter of 2017 was $1.4 million, or $0.10 diluted earnings per share compared to net income of $1.7 million or $0.12 diluted earnings per share for the same quarter in 2016.

The Company announced a quarterly dividend of $0.115 per share would be paid to all shareholders of record on June 8, 2017 and disbursed on June 15, 2017.

Escalade is a leading manufacturer and marketer of sporting goods products sold worldwide. To obtain more information on the Company and its products, visit our website at: www.EscaladeInc.com or contact Patrick Griffin, Vice President of Corporate Development & Investor Relations at 812/467-4449.

FORWARD-LOOKING STATEMENTS 

This report contains forward-looking statements relating to present or future trends or factors that are subject to risks and uncertainties.  These risks include, but are not limited to, the impact of competitive products and pricing, product demand and market acceptance, new product development, Escalade's ability to achieve its business objectives, especially with respect to its Sporting Goods business on which it has chosen to focus, Escalade's ability to successfully achieve the anticipated results of strategic transactions, including the integration of the operations of acquired assets and businesses and of divestitures of non-core assets and businesses, the continuation and development of key customer and supplier relationships, the ability to successfully negotiate the shifting retail environment and changes in consumer buying habits, disruptions or delays in our supply chain, Escalade's ability to control costs, general economic conditions, fluctuation in operating results, changes in foreign currency exchange rates, changes in the securities market, Escalade's ability to obtain financing and to maintain compliance with the terms of such financing and other risks detailed from time to time in Escalade's filings with the Securities and Exchange Commission.  Escalade's future financial performance could differ materially from the expectations of management contained herein.  Escalade undertakes no obligation to release revisions to these forward-looking statements after the date of this report.

 

Escalade, Incorporated and Subsidiaries

Consolidated Condensed Statements of Operations

(Unaudited, In Thousands Except Per Share Data)





Three Months Ended

All Amounts in Thousands Except Per Share Data





March 25,
2017


March 19,
2016









Net sales





$30,812


$34,568









Costs and Expenses








Cost of products sold





22,528


23,539

Selling, administrative and general expenses





5,930


7,763

Amortization





358


788









Operating Income





1,996


2,478









Other Income (Expense)








Interest expense





(167)


(164)

Equity in earnings (loss) of affiliates





(52)


49

Gain on bargain purchase





256


--

Other income





4


59









Income Before Income Taxes





2,037


2,422









Provision for Income Taxes





649


725









Net Income





$1,388


$ 1,697









Earnings Per Share Data:








Basic earnings per share





$  0.10


$  0.12

Diluted earnings per share





$  0.10


$  0.12









Dividends declared





$  0.115


$  0.110


















 

 

 

Consolidated Condensed Balance Sheets

(Unaudited, In Thousands)


All Amounts in Thousands Except Share Information

March 25,

2017

December31,

2016

March 19,

2016


(Unaudited)

(Audited)

(Unaudited)

ASSETS




Current Assets:




Cash and cash equivalents

$   2,536

$   1,013

$     3,260

Receivables, less allowance of $1,154; $910; and $1,888; respectively

29,265

35,894

32,469

Inventories

37,194

33,802

37,377

Prepaid expenses

2,885

2,798

1,969

Deferred income tax benefit

--

1,283

1,598

Prepaid income tax

--

833

1,238

TOTAL CURRENT ASSETS

71,880

75,623

77,911





Property, plant and equipment, net

13,527

13,714

14,073

Intangible assets, net

20,912

20,857

22,396

Goodwill

21,548

21,456

21,456

Investments

17,358

19,030

19,315

Other assets

72

81

113

TOTAL ASSETS

$145,297

$150,761

$155,264





LIABILITIES AND STOCKHOLDERS' EQUITY




Current Liabilities:




Current portion of long-term debt

$  1,300

$    1,250

$   1,910

Trade accounts payable

6,562

4,376

6,470

Accrued liabilities

7,103

12,792

9,796

Income tax payable

105

--

--

TOTAL CURRENT LIABILITIES

15,070

18,418

18,176





Other Liabilities:




Long‑term debt

23,000

24,189

32,138

Deferred income tax liability

5,026

6,441

7,200

                TOTAL LIABILITIES

43,096

49,048

57,514





Stockholders' Equity:




Preferred stock:




Authorized 1,000,000 shares; no par value, none issued




Common stock:




Authorized 30,000,000 shares; no par value, issued and outstanding – 
   14,345,528; 14,304,959; and 14,254,972; shares respectively

 

14,346

 

14,305

 

14,255

Retained earnings

91,586

91,688

85,992

Accumulated other comprehensive loss

(3,731)

(4,280)

(2,497)

TOTAL STOCKHOLDERS' EQUITY

102,201

101,713

97,750

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$145,297

$150,761

$155,264

 

 

 

SOURCE Escalade, Inc.


Source: Escalade, Inc.