Signs of progress in Black Diamond Equipment’s turnaround are beginning to peek through as the climbing and mountain brand maintains a laser-like focus on simplifying its business.

That’s the update President Neil Fiske delivered to analysts last week during an earnings call on first quarter results for Black Diamond and parent Clarus Corp.

“This quarter, we are starting to see the early results from the hard work we put in over the last year,” Fiske said during last week’s call.

That included the rebound of Black Diamond’s largest market, North America, which bounced back, showing 10% growth in wholesale from a year ago.

“(North America) is one of the first areas of focus in our turnaround plan as we completely rebuild our sales leadership team,” Fiske said. “…In addition to the sales results, we’re hearing good feedback from our retail partners that our service levels have improved, that we are sharper in our brand positioning and execution, and that we are – for the most part – outperforming the market in our categories as we seek to expand our product leadership.”

The improvement was aided by the recent return of Creative Director Kasey Jarvis and Doug Heinrich, head of product. Additionally, in October the company added Director of Key Accounts Desiree Lindemann and Director of Specialty Sales Roger Strong as part of its efforts around strengthening the North America business.

Black Diamond Distance 1100 Headlamp. Photo courtesy of Black Diamond Equipment. 

Areas of Focus

The sales additions, in particular, have helped Black Diamond bolster its specialty relationships, which Fiske said is a “top priority for us strategically.”

At the same time, work to refine the product lineup is also being prioritized under the philosophy of “fewer, bigger, better.”

A recent example includes Black Diamond’s exit in the recently ended quarter of its ski bindings business, which Fiske described as having “low margins, high SKU complexity, low terms, and high cost to serve.”

“We expect to see further… SKU reduction over the course of the year as we focus on our core sports and build on positions of strength,” Fiske said.

Exiting certain products has helped push operating costs down 8.3% and that trend in costs falling as a percentage of sales is expected to continue throughout this year, according to Fiske.

Meanwhile, inventory levels are being carefully monitored and ended the quarter down 15% compared to the year-ago period.

Black Diamond Brand President Neil Fiske. File photo by The Daily.

Clarus Financials

Salt Lake City, Utah-based Clarus doesn’t break out the individual financial performance of its brands, which consist of outdoor and adventure businesses, including Rhino-Rack, MAXTRAX and TRED Outdoors.

However, the company’s outdoor group, which includes Black Diamond, generated sales of $46.7 million in constant currency, which was down from $52.8 million in the year-ago period.

Outdoor’s decline was led by challenges in the European and other international markets as North America grew.

Clarus’ company-wide sales in the first quarter totaled $69.3 million, down 1.4%.

Clarus’ net income totaled $21.9 million, which is up from $1.6 million a year ago and takes into account the completed sale of the Precision Sport business.

The company reiterated previously stated guidance for the current year of sales totaling $270 million to $280 million, with adjusted EBITDA between $16 million and $18 million.