Johnson Outdoors (US:JOUT)2021-05-09 22:06Financial Data and Key Metrics Changes - Sales surged to $206.2 million during the second quarter, a 26% increase compared to the previous year [7] - Year-to-date sales reached $371.8 million, reflecting a 28% increase over the same period last year [7] - Operating profit for the fiscal six-month period increased by 54.4% to $59.6 million compared to the same period a year ago [8] - Net income for the quarter was $27.8 million, or $2.76 per diluted share, compared to $20.4 million in the prior year's second quarter [8][22] Business Line Data and Key Metrics Changes - In Fishing, robust demand from Minn Kota and Hummingbird technology continued, with high participation rates during the pandemic [10] - Watercraft Recreation saw growth in the Fishing Kayak segment, with innovative products like the Sportsman kayaks gaining popularity [14][15] - Diving faced challenges due to ongoing travel restrictions, but efforts to enhance digital presence and support local diving were emphasized [17] Market Data and Key Metrics Changes - The pandemic has driven unprecedented demand for outdoor recreation products, benefiting all business lines [6] - Retail inventory levels are described as lean across the three growing businesses, indicating strong market demand [25] Company Strategy and Development Direction - The company aims to maintain its leadership in the fishing market through innovation and understanding consumer needs [13] - Long-term focus includes investing in strategic drivers, sustaining innovation leadership, and optimizing digital consumer experiences [18] Management's Comments on Operating Environment and Future Outlook - Management noted that the ongoing pandemic has catalyzed increased outdoor activity participation, which has positively impacted sales [6] - The company anticipates a strong season ahead while monitoring marketplace dynamics and cost pressures [22] Other Important Information - Gross margin for the quarter was 45.2%, slightly down from the prior year due to increased tariffs and freight costs [20] - Operating expenses increased by $13.9 million, primarily driven by sales-related expenses [21] - The balance sheet remains strong, providing financial capacity for strategic investments and dividends [23] Q&A Session Summary Question: Are retail inventory levels lean across all segments? - Management confirmed that retailers are experiencing lean inventory across all three growing businesses [25] Question: What is the current capacity situation and ability to increase it? - Management indicated that they have added shifts and seasonal labor to meet demand, but are still operating at about 80% workforce capacity due to COVID-19 safety measures [26][27] Question: How have supply chain constraints changed since the last quarter? - Management described the supply chain situation as dynamic, with ongoing efforts to maintain adequate supply despite industry shortages and longer lead times [28] Question: What strategies are being considered to offset higher costs? - Management stated they will consider all options, including cost savings programs and pricing strategies, to mitigate cost increases [29]