Smith & Wesson Brands reports Q2 EPS 14c consensus 14c

Reports Q2 revenue $125 M, consensus $123.9M..Non-GAAP adjusted EBITDAS was $19.3 M, or 15.5% of net sales, compared with $25.6M, or 21.1% of net sales, for the comparable quarter last year. Mark Smith, President and Chief Executive Officer, commented, “We were very pleased with our second quarter results, which continued to reflect our innovative new product introductions and our consumers’ enduring loyalty to the Smith & Wesson brand. Top line revenue and unit shipments were both up versus last year, while channel inventories actually decreased slightly in the period. This robust sell through, combined with our shipments outperforming NICS in the quarter by over 7%, underscores our belief that our strong performance was due to share gains at the retail counter. With demand levels expected to remain elevated through our traditionally busy season, a strong balance sheet, and a significant reduction in capex on the horizon as we wind down the major investment in our new facility in Tennessee, we expect to be in a very strong position to drive returns for our stockholders throughout the second half of fiscal 2024 and in fiscal 2025.” Deana McPherson, Executive Vice President and Chief Financial Officer, commented, “Although our gross margin continues to be temporarily pressured by fixed-cost absorption, inflationary factors, and inventory reserve adjustments, we strengthened our working capital position by reducing production to drive internal inventory levels down and we anticipate that the temporary margin headwinds will abate in the fourth quarter. We repurchased nearly 646,000 shares during the third quarter, utilizing $8.2 million of our $50 million authorization, and paid $5.5M in dividends. Consistent with our capital allocation strategy, our board of directors has authorized a 12c per share quarterly dividend, which will be paid to stockholders of record on December 21, 2023 with payment to be made on January 4, 2024.”