This story was updated on 5/17/2023.
Strength in fishing and diving helped Johnson Outdoors record a 7% increase in sales for the second fiscal quarter despite challenges in its camping and watercraft divisions.
Net sales totaled $202.1 million, and net income jumped 50% to $14.9 million compared to the prior-year period. The company’s bottom line benefitted from the sale of the military and commercial tents product lines for $6.6 million, a deal that closed in March.
Gross margin increased to 37.3%, compared to 36.2%. The margin improvement was due primarily to price increases and efficiencies from increased sales volumes.
Key Bright Spots
Fishing sales rose 20% driven by price increases and improved supply of components which aided better order fulfillment to meet solid demand.
Diving sales increased 12% as global travel continues to ramp up post-pandemic.
Key Weaknesses
Camping sales dropped 28% due to high retail inventories and slower consumer spending.
Watercraft recreation sales (canoes, kayak and paddle boards) fell 44%, reflecting reductions in the overall market.
Pandemic Surge Wanes
In an earnings call with analysts, Helen Johnson-Leipold, chairman and chief executive officer, mentioned increased participation in the outdoor industry during the COVID-19 pandemic and how that has started to wane in some categories.
“Coming out of the pandemic we’re facing more challenging markets and uncertainties affecting our customers or consumers, ” she said.
Year-to-date, the company’s net sales increased 11% to $380.5 million, while net income dipped slightly to $20.7 million.
“While supply chain conditions have improved, gross margins continued to be impacted by high costs in inventory from inflationary pricing conditions,” said David Johnson, chief financial officer. “We remain laser-focused on monitoring demand, evaluating our expense structure, and managing higher-than-normal inventory levels.”
Johnson Outdoors manufactures Jetboil outdoor cooking systems and Eureka camping and hiking equipment, along with paddleboards, kayaks and canoes, fishing and diving products, and more.
