Gross margin increased by 160 basis points (“bps”) to 35.4 percent
from 33.8 percent, and Adjusted EBITDA exclusive of severance expenses
was $24.1 million, an increase of $1.5 million or 6.6 percent from $22.6
million during the first quarter last year. Adjusted EBITDA inclusive
of the severance expenses was $19.9 million and decreased by $2.7
million or 11.8 percent for the quarter.
Team Sports net sales for the first quarter was flat on a
year-over-year basis. Riddell football and Easton baseball/softball
continue to gain market share as sales in both businesses reflected
low-single digit growth, despite facing difficult comps due to the
non-recurring effects that the new policy establishing a ten-year helmet
life and the BBCOR bat transition had on each business, respectively.
Sales for the quarter also benefited from the introduction of the Easton
Mako hockey skate line. These gains were mitigated by the decrease in
sales of Easton hockey sticks due to excess retail inventories in the
category.
Action Sports net sales decreased $8.6 million, or 9.4 percent for
the quarter. The exit from the fitness products category represented
$3.3 million of the decrease and inclement weather had an effect on
sales of cycling products, both partially offset by 44 percent growth in
sales of powersports helmets from expanded product offerings and
geographic distribution, continued market share gains with Giro footwear
and the introduction of Giro cycling apparel.
The 160 bps of gross margin improvement in the quarter reflects the
transition of reconditioning operations to Mexico resulting in lower
labor costs, increased sales of higher margin bats and powersports
helmets and reduced close-out sales.
Operating expenses increased $7.0 million or 12.3 percent and 450
bps as a percentage of net sales during the quarter due to severance
expenses related to management changes, partially offset by lower legal
expense. Operating expenses decreased $1.0 million or 1.8 percent and
increased 60 bps as a percentage of net sales when excluding such
severance expenses.
“Our businesses continue to perform well with growth in Riddell
football, Easton baseball/softball and Bell powersports, dampened by the
late spring weather related impact on our cycling businesses. The
margin expansion is indicative of the strength of our brands and
products in the marketplace and our earnings increased when normalized
for severance costs related to the recent leadership changes,” stated
Terry Lee, Executive Chairman and Chief Executive Officer of
Easton-Bell.
Balance sheet
Net debt totaled $368.2 million (total debt of $406.4 million less
cash of $38.2 million) as of March 30, 2013, a decrease of $14.1 million
compared to the net debt amount as of March 31, 2012. Working capital
as of March 30, 2013 was $270.5 million (current assets of $473.3
million less current liabilities of $202.8 million) as compared to
$271.3 million as of March 31, 2012.
The company continues to have substantial borrowing capacity and
liquidity as of March 30, 2013, with $174.1 million of additional
borrowing availability under the revolving credit facility and
| EASTON-BELL SPORTS, INC. AND SUBSIDIARIES | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited and amounts in thousands)
Source Eastern-Bell through SportsOneSource More about Easton-Bell ? Use the search engine at the right top | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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