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8-K - 8-K - STURM RUGER & CO INC | d29425.htm |
EX-99.2 - EX-99.2 - STURM RUGER & CO INC | d29425_ex99-2.htm |
EXHIBIT 99.1
STURM, RUGER & CO., INC.
SOUTHPORT, CONNECTICUT 06890 U.S.A.
FOR IMMEDIATE RELEASE
STURM, RUGER & COMPANY, INC. REPORTS FIRST QUARTER 2012 FULLY DILUTED
EARNINGS OF 79¢ PER SHARE
SOUTHPORT, CONNECTICUT, May 1, 2012--Sturm, Ruger & Company, Inc. (NYSE-RGR), announced today that for the first quarter 2012, the Company reported net sales of $112.3 million and fully diluted earnings of 79¢ per share, compared with sales of $75.4 million and fully diluted earnings of 42¢ per share in 2011.
The Company also announced today that its Board of Directors declared a dividend of 32.4¢ per share for the first quarter, for shareholders of record as of May 14, 2012, payable on May 29, 2012. This dividend necessarily varies every quarter because the Company pays a percent of earnings rather than a fixed amount per share. Effective with the dividend paid in March 2012, the Company increased the percent of quarterly earnings paid out as dividends by 67%.
Chief Executive Officer Michael O. Fifer made the following comments related to the Companys results:
·
Our earnings nearly doubled from the first quarter of 2011, driven by the 49% growth in sales and our ongoing focus on continuous improvement in our operations.
·
New product introductions were a significant component of our sales growth as new product sales represented $40.8 million or 37% of sales in the first quarter of 2012. New product introductions in the first quarter of 2012 included:
o
Ruger American Rifle
o
SR22 pistol
o
10/22 Take Down rifle
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·
The estimated sell-through of our products from independent distributors to retailers in 2012 increased 62% from the first quarter of 2011. During this period, National Instant Criminal Background Check System (NICS) background checks (as adjusted by the National Shooting Sports Foundation) increased 23%.
·
On March 21, 2012, the Company announced that it temporarily suspended the acceptance of new orders. In the first quarter of 2012, orders for 1.2 million units were received by the Company, which exceeded the total units shipped during 2011. The Company anticipates resuming the acceptance of orders at the end of May 2012.
·
Cash generated from operations during the first quarter of 2012 was $21.8 million. At March 31, 2012, our cash and cash equivalents totaled $95.8 million, an increase of $14.7 million from December 2011. Our current ratio is 3.0 to 1 and we have no debt.
·
In the first quarter of 2012, capital expenditures totaled $3.0 million. We expect to invest approximately $20 million for capital expenditures during 2012.
·
At March 31, 2012, stockholders equity was $149.8 million, which equates to a book value of $7.82 per share, of which $5.01 per share was cash and equivalents.
·
On March 31, 2012, the Company completed the fourth and final quarter of its 1.2 Million Gun Challenge to Benefit the NRA. During this year-long challenge, Ruger donated a total of $1,253,700 to the NRA. We believe that Ruger is the first firearms manufacturer to build and ship more than one million firearms in one year.
Today, the Company filed its Quarterly Report on Form 10-Q for the first quarter of 2012. The financial statements included in this Quarterly Report on Form 10-Q are attached to this press release.
The Quarterly Report on Form 10-Q is available on the SEC website at www.sec.gov and the Ruger website at www.ruger.com/corporate. Investors are urged to read the complete Form 10-Q to ensure that they have adequate information to make informed investment judgments.
About Sturm, Ruger
Sturm, Ruger was founded in 1949 and is one of the nations leading manufacturers of high-quality firearms for the commercial sporting market. Sturm, Ruger is headquartered in Southport, CT, with manufacturing facilities located in Newport, NH and Prescott, AZ.
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The Company may, from time to time, make forward-looking statements and projections concerning future expectations. Such statements are based on current expectations and are subject to certain qualifying risks and uncertainties, such as market demand, sales levels of firearms, anticipated castings sales and earnings, the need for external financing for operations or capital expenditures, the results of pending litigation against the Company, the impact of future firearms control and environmental legislation, and accounting estimates, any one or more of which could cause actual results to differ materially from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to publish revised forward-looking statements to reflect events or circumstances after the date such forward-looking statements are made or to reflect the occurrence of subsequent unanticipated events.
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STURM, RUGER & COMPANY, INC.
Condensed Balance Sheets (Unaudited)
(Dollars in thousands, except share data)
| March 31, | December 31, |
|
|
|
|
|
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Assets |
|
|
|
|
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Current Assets |
|
|
Cash and cash equivalents | $ 75,835 | $ 81,056 |
Short-term investments | 19,994 | — |
Trade receivables, net | 49,026 | 42,225 |
Gross inventories | 46,264 | 49,004 |
Less LIFO reserve | (37,405) | (37,476) |
Less excess and obsolescence reserve | (1,238) | (1,311) |
Net inventories | 7,621 | 10,217 |
|
|
|
Deferred income taxes | 6,861 | 5,776 |
Prepaid expenses and other current assets | 1,025 | 6,968 |
Total Current Assets | 160,362 | 146,242 |
|
|
|
Property, plant and equipment | 171,869 | 169,142 |
Less allowances for depreciation | (119,252) | (116,195) |
Net property, plant and equipment | 52,617 | 52,947 |
Deferred income taxes | 312 | 32 |
Other assets | 8,102 | 7,289 |
Total Assets | $221,393 | $206,510 |
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STURM, RUGER & COMPANY, INC.
Condensed Balance Sheets (Unaudited) (Continued)
(Dollars in thousands, except share data)
| March 31, | December 31, |
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|
|
| |
Liabilities and Stockholders Equity |
| |
|
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Current Liabilities |
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Trade accounts payable and accrued expenses | $ 31,075 | $ 28,592 |
Product liability | 1,283 | 1,305 |
Employee compensation and benefits | 10,644 | 14,882 |
Workers compensation | 4,728 | 4,600 |
Income taxes payable | 4,405 | 217 |
Total Current Liabilities | 52,135 | 49,596 |
|
|
|
Accrued pension liability | 19,082 | 19,082 |
Product liability accrual | 398 | 441 |
|
|
|
Contingent liabilities | — | — |
Stockholders Equity |
| |
Common Stock, non-voting, par value $1: |
| |
Authorized shares 50,000; none issued | — | — |
Common Stock, par value $1: |
| |
Authorized shares 40,000,000 2012 23,445,371 issued, 19,145,937 outstanding 2011 23,382,566 issued, 19,083,132 outstanding | 23,445 | 23,383 |
Additional paid-in capital | 11,358 | 10,454 |
Retained earnings | 180,402 | 168,981 |
Less: Treasury stock at cost 2012 4,299,434 shares 2011 4,299,434 shares | (37,884) | (37,884) |
Accumulated other comprehensive loss | (27,543) | (27,543) |
Total Stockholders Equity | 149,778 | 137,391 |
Total Liabilities and Stockholders Equity | $221,393 | $206,510 |
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STURM, RUGER & COMPANY, INC.
Condensed Statements of Income and Comprehensive Income (Unaudited)
(Dollars in thousands, except per share data)
| Three Months Ended | |
| March 31, 2012 | April 2, 2011 |
| ||
| ||
Net firearms sales | $ 110,787 | $74,441 |
Net castings sales | 1,550 | 1,000 |
Total net sales | 112,337 | 75,441 |
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Cost of products sold | 70,544 | 51,446 |
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Gross profit | 41,793 | 23,995 |
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Operating expenses: |
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Selling | 10,999 | 6,912 |
General and administrative | 6,378 | 4,625 |
Total operating expenses | 17,377 | 11,537 |
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Operating income | 24,416 | 12,458 |
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Other income: |
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Interest (expense) income, net | (23) | 50 |
Other income, net | 178 | 106 |
Total other income, net | 155 | 156 |
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Income before income taxes | 24,571 | 12,614 |
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Income taxes | 9,091 | 4,667 |
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Net income and comprehensive income | $ 15,480 | $ 7,947 |
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Basic earnings per share | $0.81 | $0.42 |
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|
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Fully diluted earnings per share | $0.79 | $0.42 |
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Cash dividends per share | $0.212 | $0.050 |
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STURM, RUGER & COMPANY, INC.
Condensed Statements of Cash Flows (Unaudited)
(Dollars in thousands)
| Three Months Ended | |
| March 31, 2012 | April 2, 2011 |
| ||
Operating Activities | ||
Net income | $15,480 | $ 7,947 |
Adjustments to reconcile net income to cash provided by operating activities: |
| |
Depreciation | 3,388 | 2,930 |
Slow moving inventory valuation adjustment | (53) | (125) |
Stock-based compensation | 928 | 459 |
Gain on sale of assets | — | (7) |
Deferred income taxes | (1,365) | (1,556) |
Changes in operating assets and liabilities: |
| |
Trade receivables | (6,801) | 1,135 |
Inventories | 2,649 | 6,404 |
Trade accounts payable and accrued expenses | 2,611 | 3,319 |
Employee compensation and benefits | (4,238) | (2,384) |
Product liability | (65) | 172 |
Prepaid expenses, other assets and other liabilities | 5,119 | (472) |
Income taxes payable | 4,188 | 2,914 |
Cash provided by operating activities | 21,841 | 20,736 |
|
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Investing Activities |
| |
Property, plant and equipment additions | (3,047) | (4,306) |
Proceeds from sale of assets | — | 7 |
Purchases of short-term investments | (19,994) | (61,483) |
Proceeds from maturities of short-term investments | — | 46,994 |
Cash used for investing activities | (23,041) | (18,788) |
|
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Financing Activities |
| |
Tax benefit from exercise of stock options | 922 | 1,247 |
Repurchase of common stock | — | (1,999) |
Payment of employee withholding tax related to share-based compensation |
(884) |
— |
Dividends paid | (4,059) | (938) |
Cash used for financing activities | (4,021) | (1,690) |
|
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(Decrease) Increase in cash and cash equivalents | (5,221) | 258 |
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Cash and cash equivalents at beginning of period | 81,056 | 5,132 |
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Cash and cash equivalents at end of period | $ 75,835 | $ 5,390 |
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