Shares of Vista Outdoor traded up 25 percent on Thursday afternoon, and were up as much as 33 percent midday, after the sporting goods accessories manufacturer reported its 2nd quarter results.
Shares were mixed, and Vista Outdoor cut its guidance for fiscal 2020, but investors had been worried the report would be much worse. Despite losing $12 million in the 2nd quarter, Vista reported break-even adjusted earnings per share, ahead of the consensus estimate for a per share loss, on revenue of $445 million that beat the consensus by more than 3 percent. The company’s outdoor products division generated sales of $234 million for the quarter, down 14 percent from the same three months of last year, while revenue at the shooting-sports division was down 23 percent year over year to 211 million dollars.
Vista is a company in transition, having sold off its firearms business to focus on a portfolio of about 50 brands, including Bell, Bushnell, CamelBak, and Camp Chef, that serve bicycling, camping, and hiking enthusiasts.
Although Vista Outdoor sold its firearms business, it is still linked to the industry through its large ammunition segment, and the company continues to be weighed down by a weakness in the firearms market. The business was hampered by a distributor bankruptcy, and the decision by Walmart earlier this year to stop selling certain types of ammunition.
Shares were down more than 40 percent year to date coming into earnings, in part because of a worse-than-expected first quarter. The company is showing progress in paying down debt, reporting long-term debt of $578 million at quarter’s end, down from a peak balance of $1.17 billion. (Lewiston Tribune, NASDAQ.com)
