New York, NY- March 9, 2012 - www.InvestorIdeas.com, a global investor research portal, specializing in sector research for independent investors, issues a trading alert for security, protection and sport company Smith & Wesson Holding Corporation (NASDAQ :SWHC). The stock is trading up at $6.87, up 1.21(21.38%) 11:13AM EST on over 5 Million shares, making it the NASDAQ top percentage gainer in morning trading.
The stock moved up on financial results for its fiscal 2012 third quarter ending January 31, 2012 reported yesterday on the close.
Third Quarter Fiscal 2012 Financial Highlights
•Net sales from continuing operations for the third quarter of $98.1 million were up 23.8% from the third quarter last year. The increase was driven by strong sales of M&P™ handguns, M&P™ sporting rifles, and all Smith & Wesson personal protection and concealed carry pistols.
•Gross profit for the third quarter was $30.0 million, or 30.6% of net sales, compared with gross profit of $19.4 million, or 24.5% of net sales, for the same period last year. The improvement in gross profit was driven by increased sales volume and increased overhead absorption due to higher production levels; as well as cost-reduction initiatives across the organization, including the completion of the consolidation of the Thompson/Center Arms business to Springfield, Massachusetts, which concluded in November 2011. In addition, the same period last year included costs associated with the company's strategic price repositioning activities. That strategic repositioning also resulted in lower ongoing promotion costs.
•Operating expense for the third quarter totaled $19.7 million, or 20.1% of net sales, compared with operating expense of $21.3 million, or 26.9% of net sales, for the third quarter last year. The decrease in operating expense reflected cost-reduction initiatives across the organization as well as reduced legal fees related to the company's ongoing DOJ and SEC investigations.
•Net income from continuing operations for the third quarter was $5.4 million, or $0.08 per diluted share, compared with a net loss from continuing operations of $2.7 million, or $0.05 per diluted share, for the third quarter last year. Net income from continuing operations for the third quarter resulted from increased sales volumes and corresponding gross profit as well as reduced operating expenses.
•Non-GAAP adjusted EBITDAS from continuing operations for the third quarter increased to $14.8 million compared with $4.6 million for the same period last year.
•At January 31, 2012, firearm backlog was $198.5 million, an increase of $124.7 million, or 168.9%, compared with the end of the third quarter last year, and an increase of $48.6 million, or 32.0%, from the most recent sequential quarter.
•Operating cash flow of $8.5 million and net capital spending of $3.5 million resulted in free cash flow of $5.0 million from continuing operations.
•Debt was reduced by $30.0 million through the repayment of outstanding convertible notes.
About Smith & Wesson
Smith & Wesson Holding Corporation (NASDAQt: SWHC) is a U.S.-based leader in firearm manufacturing and design, delivering a broad portfolio of quality firearms, related products, and training to the global military, law enforcement, and consumer markets. The company's brands include Smith & Wesson®, M&P™ and Thompson/Center Arms. Smith & Wesson facilities are located in Massachusetts and Maine.
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