ANOKA, Minn. (BRAIN) — Vista Outdoor Inc. says sales in its Outdoor Products business unit, which includes its bicycle-related brands, declined 6% in its most recent quarter, which it blamed on channel inventory, high interest rates and other consumer factors. Organic sales (not including revenue from recent acquisitions) were down 15% in the business unit.
The Outdoor Products brands include Bell, Giro, Fox Racing, CamelBak, QuietKat and Blackburn, among others. The unit is being spun off into a new publicly traded company, Revelyst, this year. The other part of the Vista Outdoor business, including its ammunition brands, is being sold to Czechoslovak Group (CSG) for an enterprise value of $1.91 billion. The company said the sale will return at least $750 million to stockholders.
In the Outdoor Products business, gross profit decreased 12% to $94 million, operating income declined 57% to $13 million and operating income margin decreased 459 basis points to 3.9%. Adjusted EBITDA decreased 33% to $30 million. Adjusted EBITDA margins decreased 370 basis points to 9.3 percent.
Eric Nyman, the new CEO of Revelyst said the company will kick off an initiative called GEAR Up to simplify its business model and increase efficiency. He said efficiencies will include consolidating real estate and refocusing on its "highest potential" brands. On a conference call Thursday, company executives said Revelyst may sell brands with less potential.
More: Full earnings report.
