BRASELTON, Ga. (BRAIN) — Sales in Fox Factory's Specialty Sports Group — which comprises the company's bicycle brands: Fox and Marzocchi suspension, RaceFace and Easton Cycling — grew 14.9 percent last year, to $282 million, according to an earnings report Tuesday. The company also announced that Larry Enterline, its CEO for eight years, will retire as CEO and become executive chairman of the board in June. Mike Dennison, the president of Fox's powered vehicles group, will become CEO.
Fox reported that sales in the Specialty Sports Group also were up in the fourth quarter, by 12 percent. The company's fiscal year concluded Dec. 28, 2018.
Sales across its groups totaled $619.2 million for the year, an increase of 30.2 percent compared with fiscal 2017.
For the first quarter of 2019, Fox expects sales in the range of $150 million to $158 million and non-GAAP adjusted earnings per diluted share in the range of $0.44 to $0.49. For the fiscal year 2019, Fox forecast sales in the range of $695 million to $715 million and non-GAAP adjusted earnings per diluted share in the range of $2.45 to $2.55.
Fox's bicycle-related business now contributes less than half of the company's sales.
While sales in the Speciality Sports Group have grown steadily, Fox's powered vehicle product sales have grown faster. The bicycle-related business now contributes 46 percent of the company's sales, down from 52 percent in 2017 and 56 percent in 2016.
"We are pleased with our record results in 2018," Enterline said. "Our net sales approached the high end of our expectations, and profitability exceeded our guidance for the fourth quarter and fiscal year. We experienced favorable business fundamentals with continued growth across our Powered Vehicles Group and our Specialty Sports Group. For fiscal 2019, we believe Fox is well-positioned for future growth in new and existing categories with our compelling performance-defining offerings."
Enterline continued, "Based on our strong operational and financial results as well as our outlook for 2019, we continue to opportunistically make strategic investments to expand our manufacturing capacity primarily in our U.S. operations to better support the needs of Fox's growing business over the next several years."
Under Enderline's leadership, Fox has grown organically and via acquisition to increase sales from $197.7 million in 2011 to $619.2 million in 2018. Enterline played an integral role as Fox transitioned from a private to a publicly traded company in 2013.
Enterline said, "It has been my privilege and honor to be a part of the Fox team for the past eight years. I look forward to continuing to work with Mike, the board of directors, and our entire Fox team on strategy and business development initiatives in my new role as executive chairman. Under Mike's leadership, Fox will continue to execute our shared strategic vision for future growth. His vast international operating experience and deep understanding of Fox, our people and diverse end markets make him uniquely qualified to lead Fox into its next phase of growth."
"I am honored to have the opportunity to succeed Larry as CEO, and I look forward to continuing to work closely with him during the transition and in the future in his role as executive chairman," Dennison said. "Fox is a unique company, and it has been my pleasure to work alongside such a high-performing team of people who care about delivering best-in-class, performance-defining products with an authentic brand experience. I thank Larry for his leadership and our collaboration, and I am confident that we are going to build upon our existing accomplishments to generate sustainable growth and value for our shareholders."
