Why Outdoor Recreational Products Maker Johnson Outdoors' Stock Is Sinking Today

Johnson Outdoors Inc JOUT reported a fourth-quarter FY23 sales decline of 51% year-over-year to $96.34 million, missing the consensus of $121.03 million.

Earnings per share loss was $(1.56) below the consensus of $(0.32).

Gross margin contracted 550 bps to 29.5%, primarily due to lower sales, increased inventory reserves, and unfavorable overhead absorption. Gross profit was down 58.6% Y/Y to $28.39 million.

Operating expenses decreased by $4.3 million or 7.8% Y/Y to $50.95 million due to a reduction in sales volume-driven expenses and lower incentive compensation expenses.

The company recorded an operating loss of $(22.56) million for the quarter, compared to a profit of $13.32 million a year ago.

JOUT ended the quarter with cash and investments of $152.6 million as of September 29, 2023, with no debt on its balance sheet.

"The end of the elevated pandemic-driven demand of the past few years, combined with higher inventory levels at retail, resulted in lower sales and profits for our 2023 fiscal year. Our fiscal fourth quarter was particularly impacted by significantly slower demand," stated Helen Johnson-Leipold, Chairman and Chief Executive Officer.

Dividend: JOUT declared a quarterly cash dividend of $0.33 per Class A share and $0.30 per Class B share, payable on January 25, 2024, to shareholders of record at the close of business on January 11, 2024.

"Heading into fiscal year 2024, we're focused on carefully managing higher-than-normal inventories and improving profitability with a defined cost savings program in place and prudent expense management," said David W. Johnson, Chief Financial Officer.

Price Action: JOUT shares are trading lower by 11.69% at $48.10 on the last check Friday.

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