Vista Outdoor reported a company-wide decline in earnings for the first quarter of fiscal year 2024, with sales down 14% to $693 million compared to the prior year quarter.
However, In the Outdoor Products division, sales increased 8% to $317 million for the quarter ended June 25, 2023. The softness came in the Sporting Goods segment, where sales declined 26% to $377 million.
For fiscal year 2024, the company expects Outdoor Products sales to be approximately $1.375 billion to $1.425 billion. The company expects sales in Q2 to be flat in that division but to improve as the year goes on partly because of freight contracts and supplier negotiations that are in place to help grow sales in the back half of the year.
“Our restructuring and profit improvement initiatives for Outdoor Products are taking hold and having a meaningful impact,” said Gary McArthur, interim CEO, Vista Outdoor.
Company-wide, net income decreased to $58 million in the quarter compared to $126 million the prior year. Gross profit margin decreased 390 basis points to 32.7%, primarily due to decreased volume and price in the Sporting Products segment, according to the company.
Spinoff On Track and Eric Nyman Named CEO
The separation of the Outdoor Products segment remains on track for Vista Outdoor, with an expected spinoff date in Q4 2023. The Form 10 has been confidentially submitted to the Securities and Exchange Commission. According to Vista, the Outdoor Products division will have no debt or minimal debt at the time of the spinoff.
The company attributed some of its costs for the quarter to the separation of the Outdoor and Sporting Products divisions, including costs for restructuring, severance, retention, advisory, and legal fees.
Last week, Vista appointed Eric Nyman as CEO of the company’s Outdoor Products division.
“With the hiring of Eric Nyman … we have two highly talented and accomplished leaders sitting atop Sporting and Outdoor Products, and we are ready to take each organization to the next level,” McArthur said. “I will continue in my role as interim CEO with a keen focus on preparing the company to be ready for our planned separation in the fourth quarter of calendar year 2023.”
The name and branding of the Outdoor Products company is expected to be announced soon. Nyman will also serve as a director on the Outdoor Products company’s board of directors.
Earlier this year, Vista announced a more than $50 million cost savings plan, including office closures, spending cuts, and layoffs across its brands and corporate teams.
Brands in the Outdoor Products division include CamelBak, Bell, Giro, Camp Chef, Bushnell, Bushnell Golf, Foresight Sports, Fox Racing, Simms Fishing Products, Stone Glacier, QuietKat, and more.
In April, the company said it was speeding up the merger of the Bell, Blackburn, Copilot, Fox, Giro, Krash, and Raskullz brands by consolidating leadership and facilities.
On today’s conference call with investors and analysts, McArthur said he expects Fox and Bell to both show improvements as the integration continues.
