Olin CEO: ‘The worst is over’ for Winchester’s slumping ammo sales

08/2/17 7:30 AM | by

POMPANO BEACH, FL – JANUARY 16: Ammunition is seen for sale on the shelf at the National Armory gun store on January 16, 2013 in Pompano Beach, Florida. President Barack Obama today in Washington, DC announced a broad range of gun initiatives that his administration thinks will help curb gun violence. (Photo by Joe Raedle/Getty Images)

A top executive at Olin, the manufacturer of Winchester Ammunition, said this week the brand’s slumping sales won’t continue in the second half of 2017.

Ammo sales dipped 15 percent in the second quarter — a major contributing factor, said President and CEO John E. Fischer, in Olin’s $5.9 million loss reported Monday.

“I believe we’ve experienced the worst that we’re going to experience in Winchester in the first two quarters of this year,” he told investors during a conference call Tuesday, holding fast to the brand’s projected $125 million in annual adjusted sales.

Fischer echoed a familiar sentiment heard across the industry since November: when Republicans took Congress and the White House, the threat of looming gun control dissipated and with it, demand.

“Most of our big customers during the first half of the year were selling more than they were buying,” he said. “And that’s not sustainable long term.”

Besides, Winchester’s “strongest seasonal period” lies ahead in quarter three, according to Fischer, when he believes sales will recover.

“We’ve had years where 35 percent, 40 percent of our revenue occurs in Q3,” he said. “And we’ve also said that we’ve got a better outlook for military business. And that really, the biggest impact on that is in the second half … and that impact will also carry us through most of next year in terms of the military.”

Olin secured a $90.8 million contract with the Department of Defense in February for small caliber ammunition cartridges. Winchester will supply the United States Army with 5.56 mm, 7.62 mm, .50 caliber and small caliber ammo cartridges until July 31, 2018.

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