Editor’s note: For updated information on the challenges at Vista Outdoor, see our most recent report on the company’s earnings.
Vista Outdoor announced Monday a more than $50 million cost savings plan, which includes office closures, spending cuts, and layoffs across its brands and corporate teams.
The restructuring comes two months after former CEO Chris Metz stepped down at the request of the board of directors. Vista Outdoor is also preparing to separate its Outdoor Products and Sporting Products segments into two independent, publicly traded companies this year.
The company said the layoffs and office closures are in response to elevated inventory levels at retail along with rising interest rates and inflation.
Vista, which owns three dozen outdoor and sporting goods brands, including Fox, Bell, Giro, and CamelBak, declined to say how many workers will be laid off.
“Today’s economic headwinds and intense competition for consumer time and wallet requires radical changes in how we operate our business and deliver value for our customers and riders,” said Jeff McGuane, president, Action Sports, Vista Outdoor, in a statement.
“This transformation will enable deeper investments in product, brand and market development that are absolutely critical to strengthening our iconic brands and winning with riders in this new era.”
The company said the headcount reductions are across its brands and corporate teams.
Vista Action Sports Consolidation
In the Outdoor Products segment, the company is speeding up the merger of Bell, Blackburn, Copilot, Fox, Giro, Krash, and Raskullz brands by consolidating leadership and facilities.
The Bell and Giro headquarters in Scotts Valley in Northern California will be closed Sept. 1, 2023, with employees relocating to Fox Headquarters in Irvine in Southern California.
“Plans are underway to unite our teams at the current Fox offices, which will soon be transformed into a revamped Innovation Center that unites our teams under one roof while honoring each brand’s culture and ethos, which are unique, valued and untouchable,” McGuane said.
“Fox will be Fox, Bell will be Bell, and Giro will be Giro,” he said.
Leader of Sporting Goods Group Promoted
Vista is promoting Jason Vanderbrink to chief executive officer of the new Sporting Goods company that will be formed when the company splits in two. He will also continue his role as president of Sporting Products.
According to company SEC filings, the Board of Directors of Vista Outdoor approved a base salary increase for Vanderbrink of 53.3% to $805,000, with a possible bonus of 100% of his salary.
He’ll also be eligible for a long-term incentive under the company’s stock incentive plan worth $2.6 million.
“Jason has reshaped our ammunition portfolio through the Remington and HEVI-Shot acquisitions, and his leadership through numerous economic and demand cycles positions Sporting Products for long-term strength,” said Gary McArthur, interim CEO of Vista Outdoor.
Continued Changes at Vista Outdoor
These changes come after McArthur in February said the company was seeing “positive signs” for its business, even as it faced macroeconomic headwinds impacting consumer spending and inventory levels.
McArthur was appointed to the interim position after the board asked former CEO Chris Metz to step down from the top spot.
The company reported third quarter earnings in February.
Total sales fell by $40 million to $755 million due to a double-digit decline in organic sales, partially offset by acquisitions.
In January, the company grouped its cycling, snow and powersports brand into the single Action Sports portfolio, overseen by McGuane.
Tig H. Krekel retired as vice chairman and member of the company’s board of directors on Feb. 27 and Bell and Giro President Ric Kern retired March 31.
Bart Schaneman can be reached at email@example.com.