Vista Outdoor To Dump Firearms, Savage Arms Affected
BY Herschel Smith
5 years, 11 months ago
WTOP:
Another company, this one among the largest ammunition makers in America, is distancing itself from firearms following the massacre at Marjorie Stoneman Douglas High in February.
Vista Outdoor Inc. has been pressured for months by retailers that sell its other goods like Bell bicycle helmets and CamelBak water carriers, to stop manufacturing firearms.
The Utah company said Tuesday that it will be seeking buyers for its firearms manufacturing business, and will focus on products for outdoor enthusiasts. It will continue to sell ammunition, its biggest core businesses.
REI, the national outdoor retailer, suspended all orders from Vista in March after it refused to say if it would continue to manufacture weapons. REI said it’s aware of Vista’s announcement, but did not say if it would resume doing business with the company.
During a conference call Tuesday, Vista CEO Cristopher Metz said that the company was already moving in the direction of shedding its firearms business, “way before any of the noise came about eight weeks ago.”
[ … ]
Vista last year had revenue of $2.5 billion. It is looking for buyers for its Savage and Stevens firearms brands, and other product lines not related to firearms.
They’ve made noises of keeping the gun community as patrons though.
The firm will stop manufacturing guns but will continue to produce ammunition, which the company described as being its “largest core business.” Vista will also focus on its outdoor products.
“An increased focus on our heritage ammunition business will manifest itself in more innovative and breakthrough new products introduced over the next few years,” Vista Outdoor CEO Chris Metz said in a release.
I bolded the words “innovative and breakthrough new products.” I’m not stupid. I expect ammunition that has a higher muzzle velocity, expands better (for PD ammo), has a higher ballistic coefficient, has higher and better QA, more consistent and reliable bullet CoG and gyroscopic stability, and that no one else has.
Or else I’ll call you a crapweasel, liar and douchebag. I’ll remember this conversation, Mr. Metz. You said these things, I didn’t. You said innovative and breakthrough. You need to get the best engineers in-house immediately to make that happen. You’re going to have to dump a lot of money into this project. In the mean time, I’m sorry for Savage. They make good guns and I hope they land on their feet.
|
|
On May 2, 2018 at 7:32 am, June J said:
“Vista last year had revenue of $2.5 billion. It is looking for buyers for its Savage and Stevens firearms brands, and other product lines not related to firearms.”
Sounds like Vista has some financial issues if they have been looking to sell off multiple lines of products. Without the failures of law enforcement and educators in Broward County this story may have still run but without the added drama and agenda signaling.
On May 2, 2018 at 7:43 am, H said:
Another interpretation is that Vista is doing this to protect their CamelBak etc. business, e.g. REI has stopped doing any business with them because they make guns.
On May 2, 2018 at 9:04 am, Pat Hines said:
I’ve been an REI member since about 1970, my member number is below 100,000. While I’ve not darkened their doorway in years, never having been to their store in Asheville, I still hold the card because it gives me access to a good resource. They usually have a good supply of local Topo maps, for example; but don’t expect them to sell you a camo tent.
Any readers that are members need to write to the REI management to advise them to stop their support for civil rights denial. Hit them in their lefty vulnerability by couching your letter to hit them right in their civil rights gonads.
On May 2, 2018 at 9:27 am, Fred said:
Tl/Dr version:
I tend to believe them about selling the arms unit in this one case. They also are shedding their entire water sports and snow sports lines, and their cycling and wheel sports line. They intend to consolidate or shed half of their brands and close several units entirely.
In the Hunting Sports and Wildlife Viewing unit they own:
Blackhawk, Fusion, Bushnell, Primos Hunting, CCI, Savage Arms, Champion Target, Simmons, Federal Premium, and Weaver. It would appear that Savage is the only unit in this segment that will be sold off as they intend to consolidate from a total of 30 outdoor and sports brands down to 15 going forward.
Bottom line: They were getting their shorts handed to them long before Lakeland. I very much appreciate that Herschel keeps an eye on these companies for ill will and Fuddness toward us.
———–
Rest:
The company is a spin off of ATK (NYSE: ATK) and public on the NYSE (VSTO) in early ’15. The main purpose for selling shares is to raise capital but they have sales and earnings problems some of which has accelerated recently and they are NOT making money. Shares have been crushed since mid ’16 from nearly $52 to $14. Loses in the first couple of years of public trading are not all that unusual for a newly traded company as, again, they need the money to make the changes for which they raised the capital. And the entire firearms segment has been down due to a PERCEIVED friendly administration.
Last year they lost 274 mil and this last quarter they lost 60 mil which extrapolated would leave them on pace to lose 240 mil again this year. The problem is the growth. It’s awful. on Earnings Per Share (EPS) they lost .28 or .22 cents per share this quarter depending on which accounting tricks are used. This is according to them. According to Zacks (People I trust) last years same quarter EPS is down 79% and down 61% from the previous quarter. All of this is tricky but you can’t fake sales (counted in money not items), which according to Zacks is down 11% from this quarter last year and dropped 1% from the most recent quarter. Again, on pace for another 11% to 12% down year.
It’s a turn around story that I wouldn’t own until the light at the end of that tunnel is no longer an oncoming train! But I likely own them incidentally in one of my funds. I like Federal Premium and CCI but I run Hornady for defense and have a local guy I use for target.
On May 2, 2018 at 11:10 am, Bill Robbins said:
VSTO is using the “opportunity” to dig themselves out of debt, resulting from a failed business model dreamed up by banksters who spun-off the company after loading it up with ho-hum brands and lots of debt. Guess who made money? The banksters and a few key executives.
Firearms are not VSTO’s problem. VSTO’s failed business model is the problem.
I worked in the outdoor products business and have direct experience with many of of VSTO’s product lines and end-markets.
On May 2, 2018 at 4:24 pm, dad29 said:
It appears that the MSM is very happy to point to Parkland and to highlight REI’s noisemaking. But several ‘net analysts have the same outlook as your commenters above: it’s all about the money, and VISTA was losing money like crazy. They need cash, and selling assets is the way to get it.
On May 2, 2018 at 5:06 pm, rocketguy said:
Former CEO Mark DeYoung was a corrupt jackass with delusions of grandeur. Take a look at stock price since the ATK split and note the massive drops aligning with financial shenanigans coming to light. Not surprised they’re making major changes.
Sure was fun buying ammo at employee prices before the split….
On May 3, 2018 at 2:49 am, ROFuher said:
Look at Source Hydration as an alternative. Their reservoirs are hands down superior to Camelback.