Fans visiting Remington-land at SHOT Show 2016. This year also marks the company’s 200th anniversary. (Photo: Remington)
Although gun sales were up in 2015, firearm conglomerate Remington Outdoor Company reported a $135.2 million loss for the year, according to annual financial filings released this month.
The company attributed the loss to the 2014 move to Huntsville, Alabama, where it is consolidating operations for roughly half of the companies under the Remington umbrella, and an expansion of an Arkansas ammo plant. In the annual filing, Remington described the expenditures as one-time “restructuring and start-up” costs that would span two years.
Remington’s loss in 2015 was made up of an additional $72.7 million in operating costs, and $68.4 million in federal excise taxes, according to the filing. In 2014, the company reported a $68.2 million loss, which is just shy of half the total loss in 2015.
Annual net sales totaled $808.9 million, down $130.4 million in 2014. Of the total, firearms contributed $375.2 million, ammo $355.7 million, and other consumer goods $78 million.
Remington said the $46.3 million decrease in gun sales was caused by a soft hunting season, decline in the 1911 handgun market, discontinued products, and “a delayed response to changes in the market and a trend toward value price point products.”
Ammo sales were also down last year as the company saw a $49.2 million decrease in sales. Consumers spent $33.2 million less in centerfire ammo and $21.8 million less in shotgun shells. Other ammo products decreased by $6.1 million.
Consumer goods decreased by $34.9 million. The company explains it was the result of lower sales of parts, clothes, and airguns and accessories.
Competitors also ended quarterly and annual earnings in the black. Vista Outdoor, another conglomerate with more than 30 firearm and outdoor brands, reported in February third quarter sales totaling $593 million and raking in $43.2 million in profit. The company then raised annual financial expectations by $20 million.
For third quarter earnings, ending in March, Smith & Wessonreported $210.8 million in sales, which resulted in a $31.4 million profit. Nine months into fiscal 2016, the company generated $501.8 million. The Massachusetts gun maker, which expressed aspirations of becoming a broader outdoor brand, raised its goal for fourth quarter earnings by $5 million, putting estimates at $215 million for the quarter and $717 million for 2016.
Olin Corporation, owner of Winchester Ammunition, ended 2015 with $711.4 million in total sales for the ammo company. Although profits were lower, the difference was attributed to relocation costs.
In November, Moody’s Investors Service downgraded Remington’s corporate rating to “poor quality” investment and posing a “very high credit risk.” The service cited weak performance and said operational costs and debt will likely continue to outweigh earnings.
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