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Clarus Reports Record First Quarter 2022 Results
Источник: Nasdaq GlobeNewswire / 09 май 2022 16:05:01 America/New_York
– Sales in the First Quarter of 2022 Increased 50% Year-Over-Year to $113.3 Million –
– Record Adjusted EBITDA of $19.7 million or 17.4% Adjusted EBITDA Margin –
SALT LAKE CITY, May 09, 2022 (GLOBE NEWSWIRE) -- Clarus Corporation (NASDAQ: CLAR) (“Clarus” and/or the “Company”), a global company focused on the outdoor and consumer enthusiast markets, reported financial results for the first quarter ended March 31, 2022.
First Quarter 2022 Financial Summary vs. Same Year‐Ago Quarter
- Record sales of $113.3 million increased 50% and 6% on a proforma basis.
- Gross margin improved 320 basis points to 39.1%; adjusted gross margin increased 290 basis points to 39.3%.
- Net income was $5.3 million, or $0.13 per diluted share, compared to net income of $5.7 million, or $0.17 per diluted share.
- Adjusted net income before non‐cash items increased 44% to $14.8 million, or $0.37 per diluted share, compared to $10.2 million, or $0.31 per diluted share.
- Adjusted EBITDA increased significantly to a record $19.7 million with an adjusted EBITDA margin of 17.4%, compared to $10.6 million with an adjusted EBITDA margin of 14.1%.
Management Commentary
“The momentum from our record-setting year in 2021 certainly continued into the first quarter of 2022,” said Clarus President John Walbrecht. “Our Precision Sport segment continues to execute at a high level, growing sales by 41%, and in our Adventure segment, we are pleased to report early success in our ‘Innovate and Accelerate’ strategy. Rhino-Rack’s net sales in North America during the first quarter increased 42%, an early proof point of the substantial white space that we believe exists for our Adventure brands in this market. While we continue to experience a strong order book for Black Diamond, supply chain and logistic challenges impacted our ability to convert all Outdoor segment demand into revenue.
“Looking to the remainder of the year, we believe our portfolio of ‘Super Fan’ brands has us well-positioned to continue our market momentum. Our brands have demonstrated strong resistance to recent economic headwinds, highlighting the durability of our entire portfolio of activity-based brands. We estimate some of the logistics challenges we experienced in the first quarter will subside in the back half of the year. This combination is expected to position us for another record-setting year in 2022.”
First Quarter 2022 Financial Results
Sales in the first quarter increased 50% to $113.3 million compared to $75.3 million in the same year‐ago quarter. The increase includes revenue contribution of approximately $24.5 million from Rhino-Rack, an acquisition completed on July 1, 2021, and $4.2 million from MAXTRAX, an acquisition completed on December 1, 2021. First quarter sales increased 6% on a proforma basis compared to the year-ago quarter.
Sales in the Outdoor segment were $51.5 million compared to $51.8 million in the same year-ago quarter, while Precision Sport sales increased 41% to $33.1 million. Sales in the Adventure segment were $28.7 million in the first quarter of 2022. Despite strong customer demand, Outdoor segment sales were impacted by logistics challenges that affected the Company’s ability to deliver products on-time and in full. Sales in the Precision Sport and Adventure segments reflect continued strong customer demand and outperformance in navigating the challenging supply chain environment.
Gross margin in the first quarter improved 320 basis points to 39.1% compared to 35.9% in the year‐ago quarter due to improvements in channel and product mix, as well as operational efficiencies achieved due to the Company’s larger scale. Excluding a $0.3 million fair value inventory step-up associated with the MAXTRAX acquisition, adjusted gross margin in the first quarter increased 290 basis points to 39.3%.
Selling, general and administrative expenses in the first quarter were $34.2 million compared to $20.9 million in the same year‐ago quarter due primarily to the inclusion of Rhino-Rack and MAXTRAX, which contributed $9.4 million in expenses. Non-cash stock-based compensation for performance awards was $3.4 million, a $1.8 million increase compared to the first quarter of 2021. The remainder of the increase was driven by investments in the Company’s go-to-market and fulfilment activities in support of its increased sales.
Net income in the first quarter was $5.3 million, or $0.13 per diluted share, compared to net income of $5.7 million, or $0.17 per diluted share, in the prior year quarter.
Adjusted net income in the first quarter, which excludes non‐cash items and transaction costs, increased 44% to $14.8 million, or $0.37 per diluted share, compared to an adjusted net income of $10.2 million, or $0.31 per diluted share, in the same year‐ago quarter.
Adjusted EBITDA in the first quarter increased 85% to a record $19.7 million, or an adjusted EBITDA margin of 17.4%, compared to $10.6 million, or an adjusted EBITDA margin of 14.1%, in the same year‐ago quarter.
Net cash used in operating activities for the three months ended March 31, 2022 was $(10.8) million compared to $(2.5) million in the prior year quarter. Capital expenditures in the first quarter of 2022 were $1.9 million compared to $1.3 million in the prior year quarter. Free cash flow, defined as net cash provided by operating activities less capital expenditures, for the first quarter of 2022 was $(12.7) million compared to $(3.9) million in the same year‐ago quarter. The decrease is primarily due to investments in inventory to mitigate supply chain constraints.
Liquidity at March 31, 2022 vs. December 31, 2021
- Cash and cash equivalents totaled $16.5 million compared to $19.5 million.
- Total debt of $151.9 million compared to $141.5 million.
- Net debt leverage ratio 1.9x compared to 2.0x at the end of 2021.
Amended and Restated Credit Agreement
On April 18, 2022, the Company entered into an amended and restated credit agreement with its banking partners, the agreement provides for borrowings of up to $300 million under a secured revolving credit facility and borrowings of $125 million under a secured term loan facility. At closing the $125 million was fully drawn and $29 million was outstanding under the revolving credit facility. The amended and restated credit agreement has customary commitment fees and covenants and matures on April 18, 2027.
2022 Outlook
Clarus anticipates fiscal year 2022 sales to grow approximately 25% to $470.0 million compared to 2021. By segment, the Company expects sales for Outdoor to increase high-single digits to approximately $237.5 million, the Precision Sport segment to increase low-single digits to approximately $112.5 million, and the Adventure segment to contribute approximately $120 million.
The Company expects adjusted EBITDA in 2022 to be approximately $78.0 million, or an adjusted EBITDA margin of 16.5%. In addition, capital expenditures are still expected to be approximately $9.0 million and free cash flow is still expected to range between $50.0 to $60.0 million.
Net Operating Loss (NOL)
The Company estimates that it has available NOL carryforwards for U.S. federal income tax purposes of approximately $60.7 million, which includes $39.5 million of NOL carryforwards that expire on December 31, 2022. The Company expects to fully utilize the $39.5 million in the current year, prior to expiration. The Company’s common stock is subject to a rights agreement dated February 7, 2008, that is intended to limit the number of 5% or more owners and therefore reduce the risk of a possible change of ownership under Section 382 of the Internal Revenue Code of 1986, as amended. Any such change of ownership under these rules would limit or eliminate the ability of the Company to use its existing NOLs for federal income tax purposes. However, there is no guaranty that the rights agreement will achieve the objective of preserving the value of the NOLs.
Conference Call
The Company will hold a conference call today at 5:00 p.m. Eastern time to discuss its first quarter 2022 results.
Date: Monday, May 9, 2022
Time: 5:00 p.m. Eastern time (3:00 p.m. Mountain time)
Toll-free dial-in number: 1-877-511-3707
International dial-in number: 1-786-815-8672
Conference ID: 3778768Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Group at 1-949-574-3860.
The conference call will be broadcast live and available for replay here and on the Company’s website at www.claruscorp.com.
A replay of the conference call will be available after 8:00 p.m. Eastern time on the same day through May 23, 2022.
Toll-free replay number: 1-855-859-2056
International replay number: 1-404-537-3406
Replay ID: 3778768About Clarus Corporation
Headquartered in Salt Lake City, Utah, Clarus Corporation is a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor and consumer enthusiast markets. Our mission is to identify, acquire and grow outdoor “super fan” brands through our unique “innovate and accelerate” strategy. We define a “super fan” brand as a brand that creates the world’s pre-eminent, performance-defining product that the best-in-class user cannot live without. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, Sierra®, and Barnes® brand names through outdoor specialty and online retailers, our own websites, distributors, and original equipment manufacturers. Our portfolio of iconic brands is well-positioned for sustainable, long-term growth underpinned by powerful industry trends across the outdoor and adventure sport end markets. For additional information, please visit www.claruscorp.com or the brand websites at www.blackdiamondequipment.com, www.rhinorack.com, www.maxtrax.com.au, www.sierrabullets.com, www.barnesbullets.com, www.pieps.com, or www.goclimbon.com.
Use of Non‐GAAP Measures
The Company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). This press release contains the non-GAAP measures: (i) adjusted gross margin and adjusted gross profit, (ii) net income before non-cash items and related income per diluted share, and adjusted net income before non-cash items and related income per diluted share, (iii) earnings before interest, taxes, other income or expense, depreciation and amortization (“EBITDA”), EBITDA margin, adjusted EBITDA, and adjusted EBTIDA margin, and (iv) free cash flow. The Company believes that the presentation of certain non-GAAP measures, i.e.: (i) adjusted gross margin and adjusted gross profit, (ii) net income before non-cash items and related income per diluted share, and adjusted net income before non-cash items and related income per diluted share, (iii) EBITDA, EBITDA margin, adjusted EBITDA and adjusted EBITDA margin, and (iv) free cash flow, provide useful information for the understanding of its ongoing operations and enables investors to focus on period- over-period operating performance, and thereby enhances the user's overall understanding of the Company's current financial performance relative to past performance and provides, along with the nearest GAAP measures, a baseline for modeling future earnings expectations. Non-GAAP measures are reconciled to comparable GAAP financial measures within this press release. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. Additionally, the Company notes that there can be no assurance that the above referenced non-GAAP financial measures are comparable to similarly titled financial measures used by other publicly traded companies.
Forward-Looking Statements
Please note that in this press release we may use words such as “appears,” “anticipates,” “believes,” “plans,” “expects,” “intends,” “future,” and similar expressions which constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting the Company and therefore involve a number of risks and uncertainties. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements. Potential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this release, include, but are not limited to, those risks and uncertainties more fully described from time to time in the Company's public reports filed with the Securities and Exchange Commission, including under the section titled “Risk Factors” in the Company's Annual Report on Form 10-K, and/or Quarterly Reports on Form 10-Q, as well as in the Company’s Current Reports on Form 8-K. All forward-looking statements included in this press release are based upon information available to the Company as of the date of this press release and speak only as of the date hereof. We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this press release.
Company Contacts:
John C. Walbrecht
President
Tel 1‐801‐993‐1344
john.walbrecht@claruscorp.comMichael J. Yates
Chief Financial Officer
Tel 1‐801-993‐1304
mike.yates@claruscorp.comInvestor Relations Contact:
Gateway Group, Inc.
Cody Slach
Tel 1‐949‐574‐3860
CLAR@gatewayir.comCLARUS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except per share amounts) March 31, 2022 December 31, 2021 Assets Current assets Cash $ 16,451 $ 19,465 Accounts receivable, less allowance for credit losses of $1,283 and $811 69,530 66,180 Inventories 152,718 129,354 Prepaid and other current assets 12,838 11,831 Income tax receivable 258 116 Total current assets 251,795 226,946 Property and equipment, net 43,168 42,826 Other intangible assets, net 71,327 73,683 Indefinite-lived intangible assets 131,115 128,271 Goodwill 121,064 118,090 Deferred income taxes 22,456 22,433 Other long-term assets 20,157 19,578 Total assets $ 661,082 $ 631,827 Liabilities and Stockholders' Equity Current liabilities Accounts payable $ 34,098 $ 31,488 Accrued liabilities 30,176 27,473 Income tax payable 1,844 4,437 Current portion of long-term debt 12,103 9,585 Total current liabilities 78,221 72,983 Long-term debt, net 139,829 131,948 Deferred income taxes 36,892 35,280 Other long-term liabilities 23,034 21,448 Total liabilities 277,976 261,659 Stockholders' Equity Preferred stock, $0.0001 par value per share; 5,000 shares authorized; none issued - - Common stock, $0.0001 par value per share; 100,000 shares authorized; 41,272 and 41,105 issued and 37,210 and 37,094 outstanding, respectively 4 4 Additional paid in capital 666,489 662,996 Accumulated deficit (258,963 ) (263,342 ) Treasury stock, at cost (25,537 ) (24,440 ) Accumulated other comprehensive income (loss) 1,113 (5,050 ) Total stockholders' equity 383,106 370,168 Total liabilities and stockholders' equity $ 661,082 $ 631,827 CLARUS CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (In thousands, except per share amounts) Three Months Ended March 31, 2022 March 31, 2021 Sales Domestic sales $ 62,307 $ 47,573 International sales 50,969 27,758 Total sales 113,276 75,331 Cost of goods sold 69,024 48,281 Gross profit 44,252 27,050 Operating expenses Selling, general and administrative 34,175 20,885 Transaction costs 1,201 476 Contingent consideration expense 763 - Total operating expenses 36,139 21,361 Operating income 8,113 5,689 Other expense Interest expense, net (1,116 ) (238 ) Other, net (67 ) (140 ) Total other expense, net (1,183 ) (378 ) Income before income tax 6,930 5,311 Income tax expense (benefit) 1,621 (366 ) Net income $ 5,309 $ 5,677 Net income per share: Basic $ 0.14 $ 0.18 Diluted 0.13 0.17 Weighted average shares outstanding: Basic 37,161 31,283 Diluted 39,802 32,750 CLARUS CORPORATION RECONCILIATION FROM GROSS PROFIT TO ADJUSTED GROSS PROFIT AND ADJUSTED GROSS MARGIN THREE MONTHS ENDED March 31, 2022 March 31, 2021 Gross profit as reported $ 44,252 Gross profit as reported 27,050 Plus impact of inventory fair value adjustment 269 Plus impact of inventory fair value adjustment 361 Adjusted gross profit $ 44,521 Adjusted gross profit $ 27,411 Gross margin as reported 39.1 % Gross margin as reported 35.9 % Adjusted gross margin 39.3 % Adjusted gross margin 36.4 % CLARUS CORPORATION RECONCILIATION FROM NET INCOME TO NET INCOME BEFORE NON-CASH ITEMS, ADJUSTED NET INCOME BEFORE NON-CASH ITEMS AND RELATED EARNINGS PER DILUTED SHARE (In thousands, except per share amounts) Three Months Ended Per Diluted Per Diluted March 31, 2022 Share March 31, 2021 Share Net income $ 5,309 $ 0.13 $ 5,677 $ 0.17 Amortization of intangibles 4,120 0.10 1,197 0.04 Depreciation 1,832 0.05 1,356 0.04 Amortization of debt issuance costs 170 0.00 82 0.00 Stock-based compensation 3,367 0.08 1,524 0.05 Inventory fair value of purchase accounting 269 0.01 361 0.01 Income tax expense (benefit) 1,621 0.04 (366 ) (0.01 ) Cash paid for income taxes (3,844 ) (0.10 ) (75 ) (0.00 ) Net income before non-cash items $ 12,844 $ 0.32 $ 9,756 $ 0.30 Transaction costs 1,201 0.03 476 0.01 Contingent consideration expense 763 0.02 - - State cash taxes on adjustments (43 ) (0.00 ) (12 ) (0.00 ) Adjusted net income before non-cash items $ 14,765 $ 0.37 $ 10,220 $ 0.31 CLARUS CORPORATION RECONCILIATION FROM NET INCOME TO EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION, AND AMORTIZATION (EBITDA), AND ADJUSTED EBITDA (In thousands) Three Months Ended March 31, 2022 March 31, 2021 Net income $ 5,309 $ 5,677 Income tax expense (benefit) 1,621 (366 ) Other, net 67 140 Interest expense, net 1,116 238 Operating income 8,113 5,689 Depreciation 1,832 1,356 Amortization of intangibles 4,120 1,197 EBITDA 14,065 8,242 Transaction costs 1,201 476 Contingent consideration expense 763 - Inventory fair value of purchase accounting 269 361 Stock-based compensation 3,367 1,524 Adjusted EBITDA $ 19,665 $ 10,603 Sales $ 113,276 $ 75,331 EBITDA margin 12.4 % 10.9 % Adjusted EBITDA margin 17.4 % 14.1 %