Johnson Outdoors (US:JOUT)2026-02-06 17:02Financial Data and Key Metrics Changes - The company reported a loss before income taxes of $1.3 million for the first quarter, significantly improved from a pretax loss of $18.9 million in the same quarter last year, driven by revenue growth and improving margins [8] - Gross margin improved to 36.6%, up 6.7 percentage points from the prior year, primarily due to overhead absorption from higher volumes and price increases offsetting material cost increases [8] - Operating expenses increased by $2.1 million compared to the previous year, mainly due to increased sales volume-related expenses, partially offset by decreased warranty expenses [8] Business Line Data and Key Metrics Changes - The fishing segment, particularly the Minn Kota and Humminbird brands, showed solid performance with strong demand for new products like the XPLORE Series and MEGA Live 2 fish finders [4] - In the camping and watercraft segment, investments in digital and e-commerce have paid off, with Jetboil and Old Town seeing growth driven by online sales [4][5] - The diving segment experienced increased sales due to improved global market conditions and successful product innovations, particularly the SCUBAPRO's new HYDROS PRO 2 [5][6] Market Data and Key Metrics Changes - The company noted that markets have stabilized, contributing to double-digit growth in the first quarter, which is typically a slower period [3] - Trade inventory levels were reported to be in a healthy position, allowing for good sell-in during the first quarter [17] Company Strategy and Development Direction - The company aims to maintain a strong innovation pipeline, grow digital and e-commerce momentum, and improve product costs and operating efficiency through cost-saving initiatives [7] - The focus on innovation is seen as critical for maintaining market leadership amid strong competition [13] Management Comments on Operating Environment and Future Outlook - Management expressed optimism about the start of fiscal 2026, highlighting improved profitability and execution of growth plans despite uncertainties in the broader environment [4][6] - The company remains confident in its ability to create long-term value for shareholders, with a debt-free balance sheet and ongoing dividend payments [9] Other Important Information - The inventory balance at the end of the first quarter was $183.9 million, down about $17.7 million from the previous year [9] Q&A Session Summary Question: Pricing versus unit volumes - Management indicated that most of the revenue increase was driven by unit volume, although pricing adjustments were made in response to cost increases [12] Question: Contribution of new products to sales - Management confirmed that innovation remains critical, with improvements in new product success rates observed over the last couple of years [15] Question: E-commerce revenue percentage and growth goals - E-commerce is the fastest-growing channel for the company, with goals to continue expanding it at a faster pace than overall business growth [16] Question: Current trade inventory levels - Management reported that trade inventory levels are healthy, allowing for good sell-in during the first quarter [17] Question: Future cost savings initiatives - Management emphasized that cost savings initiatives will continue to be a key strategy, especially in volatile supply chain conditions [18] Question: Warranty expense impact on operating expenses - Warranty expenses were noted to have decreased, contributing to a slight reduction in operating expense percentage [19] Question: Future tax rate expectations - Management indicated that the tax rate may fluctuate based on profits in various geographies, particularly due to a valuation allowance in the U.S. [21]