Sturm, Ruger & Company, Inc. Reports Third Quarter Diluted Earnings of 28¢ Per Share and Declares Quarterly Dividend of 11¢ Per Share

Rhea-AI Summary

Sturm, Ruger & Company reported Q3 2024 net sales of $122.3 million with diluted earnings of 28¢ per share, compared to $120.9 million and 42¢ per share in Q3 2023. For the nine months ended September 2024, net sales were $389.9 million with diluted earnings of $1.15 per share, down from $413.2 million and $2.13 per share in 2023. The Board declared a quarterly dividend of 11¢ per share. New product sales represented $113.3 million or 31.2% of firearm sales. The company's cash position remains strong with $96.0 million in cash and short-term investments, no debt, and a current ratio of 4.5 to 1.

Positive

• Net sales increased 1.2% YoY in Q3 2024 to $122.3 million
• Estimated sell-through to retailers increased 4% in first nine months of 2024
• New product sales contributed 31.2% of firearm sales ($113.3 million)
• Strong balance sheet with $96.0 million in cash and no debt
• Returned $39.3 million to shareholders through dividends and share repurchases

Negative

• Diluted EPS declined 33.3% YoY in Q3 2024 (28¢ vs 42¢)
• Nine-month net sales decreased 5.6% YoY ($389.9M vs $413.2M)
• Nine-month diluted EPS dropped 46% YoY ($1.15 vs $2.13)

Insights

Financial Analyst

Q3 results reveal mixed signals. While net sales marginally increased by 1.2% to $122.3 million, earnings per share declined significantly from 42¢ to 28¢. The nine-month performance shows broader weakness with sales down 5.6% and EPS dropping 46%.

Key positives include a 4% increase in distributor sell-through, strong cash position of $96 million and inventory reduction of 125,000 units. The company maintains financial discipline with zero debt and a healthy current ratio of 4.5. Strategic share buybacks of $29.3 million demonstrate confidence in long-term value.

However, margin pressure is evident in the "promotion-rich environment," and the broader industry faces headwinds with NICS background checks down 3%. New products contributing 31.2% of sales indicate strong innovation but haven't fully offset pricing pressures.

SOUTHPORT, Conn.--(BUSINESS WIRE)-- Sturm, Ruger & Company, Inc. (NYSE-RGR) announced today that for the third quarter of 2024, net sales were $122.3 million and diluted earnings were 28¢ per share. For the corresponding period in 2023, net sales were $120.9 million and diluted earnings were 42¢ per share.

For the nine months ended September 28, 2024, net sales were $389.9 million and diluted earnings were $1.15 per share. For the corresponding period in 2023, net sales were $413.2 million and diluted earnings were $2.13 per share.

The Company also announced today that its Board of Directors declared a dividend of 11¢ per share for the third quarter for stockholders of record as of November 13, 2024, payable on November 27, 2024. This dividend varies every quarter because the Company pays a percentage of earnings rather than a fixed amount per share. This dividend is approximately 40% of net income.

Chief Executive Officer Christopher J. Killoy commented on the 2024 results, “The diversity of our products has been instrumental to our performance this year. We capitalized on the strong demand for several of our product families, including the Ruger American Rifle Generation II bolt-action rifles, the Marlin lever-action rifles, and the Security-380 pistol, maintaining our market share without sacrificing our long-term focus or pricing discipline. Despite the current promotion-rich environment, the estimated sell-through of our products from our independent distributors to retailers increased while our finished goods inventory and our distributors’ inventories have decreased 125,000 units in the past year. We are well positioned to increase production entering the traditionally stronger fall and winter selling seasons, allowing us to capitalize on the pent up demand for our more sought after products.”

Mr. Killoy discussed Ruger’s storied history, “Developing innovative new products to drive growth, excitement, and profitability has been the hallmark of Ruger since its inception 75 years ago. We are proud to have introduced so many new offerings in this milestone year:

• American Rifle Generation II family of rifles,
• The Marlin 1894, 1895 and 336 lever-action rifles,
• LC Carbine chambered in .45 Auto and 10mm Auto,
• 75^th Anniversary Mark IV Target pistol,
• 75^th Anniversary 10/22 rifles,
• 75^th Anniversary LCP MAX pistol,
• 75^th Anniversary No. 1 rifle, and
• Mini-14 rifle with side-folding stock.

And we are not done. Keep an eye out for an exciting new product launch in the coming months.”

Mr. Killoy concluded with an update from the National Association of Sporting Goods Wholesalers Annual Exposition, “We were thrilled to be recognized by our wholesale customers with three industry awards at this year’s NASGW Show in Kansas City, Missouri. We were named ‘Firearm Manufacturer of the Year’ for the second consecutive year, and the 12^th time in the past 15 years. Additionally, the Ruger American Rifle Generation II rifle earned the NASGW-POMA Caliber Awards for ‘Best New Rifle’ and ‘Best New Overall Product’.”

Mr. Killoy himself was honored with the NASGW “Chairman’s Award” which is the highest honor from the NASGW Board of Directors, given to those with long-lasting, significant impact in the outdoor shooting sports industry.

Mr. Killoy made the following observations related to the Company’s third quarter 2024 performance:

• The estimated unit sell-through of the Company’s products from the independent distributors to retailers increased 4% in first nine months of 2024 compared to the prior year period. For the same period, NICS background checks, as adjusted by the National Shooting Sports Foundation, decreased 3%.
• Sales of new products, including the Security-380 pistol, Super Wrangler revolver, Marlin lever-action rifles, LC Carbine, Small-Frame Autoloading Rifle, and American Centerfire Rifle Generation II, represented $113.3 million or 31.2% of firearm sales in the first nine months of 2024. New product sales include only major new products that were introduced in the past two years.
• Compared to the third quarter of 2023, the Company’s and distributors’ finished goods inventories decreased 26,500 units and 98,600 units, respectively.
• Cash provided by operations during the first nine months of 2024 was $35.5 million. At September 28, 2024, our cash and short-term investments totaled $96.0 million. Our current ratio is 4.5 to 1 and we have no debt.
• In the first nine months of 2024, capital expenditures totaled $17.2 million related to new product introductions, upgrades to our manufacturing equipment, and facilities. We expect our 2024 capital expenditures to approximate $20 million.
• The Company returned $39.3 million to its shareholders in the first nine months of 2024 through:
  • the payment of $10.0 million of quarterly dividends, and
  • $29.3 million through the repurchase of 699,000 shares of its common stock at an average cost of $41.99 per share, representing 4% of our outstanding shares.
• At September 28, 2024, stockholders’ equity was $314.9 million, which equates to a book value of $18.76 per share, of which $5.72 per share was cash and short-term investments.

Today, the Company filed its Quarterly Report on Form 10-Q for the third quarter of 2024. The financial statements included in this Quarterly Report on Form 10-Q are attached to this press release.

Tomorrow, October 31, 2024, Sturm, Ruger will host a webcast at 9:00 a.m. ET to discuss the third quarter operating results. Interested parties can listen to the webcast via this link or by visiting Ruger.com/corporate. Those who wish to ask questions during the webcast will need to pre-register prior to the meeting.

The Quarterly Report on Form 10-Q for the third quarter of 2024 is available on the SEC website at SEC.gov and the Ruger website at Ruger.com/corporate. Investors are urged to read the complete Quarterly Report on Form 10-Q to ensure that they have adequate information to make informed investment judgments.

About Sturm, Ruger & Co., Inc.

Sturm, Ruger & Co., Inc. is one of the nation's leading manufacturers of rugged, reliable firearms for the commercial sporting market. With products made in America, Ruger offers consumers almost 800 variations of more than 40 product lines, across both the Ruger and Marlin brands. For 75 years, Ruger has been a model of corporate and community responsibility. Our motto, “Arms Makers for Responsible Citizens^®,” echoes our commitment to these principles as we work hard to deliver quality and innovative firearms.

The Company may, from time to time, make forward-looking statements and projections concerning future expectations. Such statements are based on current expectations and are subject to certain qualifying risks and uncertainties, such as market demand, sales levels of firearms, anticipated castings sales and earnings, the need for external financing for operations or capital expenditures, the results of pending litigation against the Company, the impact of future firearms control and environmental legislation, and accounting estimates, any one or more of which could cause actual results to differ materially from those projected. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date made. The Company undertakes no obligation to publish revised forward-looking statements to reflect events or circumstances after the date such forward-looking statements are made or to reflect the occurrence of subsequent unanticipated events.

STURM, RUGER & COMPANY, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(Dollars in thousands)
	September 28, 2024			December 31, 2023
Assets
Current Assets
Cash	$	7,522		$	15,174
Short-term investments		88,455			102,485
Trade receivables, net		60,157			59,864
Gross inventories		150,460			150,192
Less LIFO reserve		(68,265	)		(64,262	)
Less excess and obsolescence reserve		(6,159	)		(6,120	)
Net inventories		76,036			79,810
Prepaid expenses and other current assets		14,944			14,062
Total Current Assets		247,114			271,395
Property, plant and equipment		474,501			462,397
Less allowances for depreciation		(401,972	)		(390,863	)
Net property, plant and equipment		72,529			71,534
Deferred income taxes		14,918			11,976
Other assets		38,893			43,912
Total Assets	$	373,454		$	398,817

STURM, RUGER & COMPANY, INC.   CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Continued) (Dollars in thousands, except per share data)
	September 28, 2024			December 31, 2023
Liabilities and Stockholders’ Equity
Current Liabilities
Trade accounts payable and accrued expenses	$	31,495		$	31,708
Contract liabilities with customers		-			149
Product liability		270			634
Employee compensation and benefits		17,413			24,660
Workers’ compensation		5,792			6,044
Total Current Liabilities		54,970			63,195
Employee compensation		1,712			1,685
Product liability accrual		61			46
Lease liability		1,766			2,170
Contingent liabilities		-			-
Stockholders’ Equity
Common Stock, non-voting, par value $1:
Authorized shares 50,000; none issued		-			-
Common Stock, par value $1:
Authorized shares – 40,000,000
2024 – 24,467,983 issued,
16,790,824 outstanding
2023 – 24,437,020 issued,
17,458,620 outstanding		24,468			24,437
Additional paid-in capital		49,441			46,849
Retained earnings		428,014			418,058
Less: Treasury stock – at cost
2024 – 7,677,159 shares
2023 – 6,978,400 shares		(186,978	)		(157,623	)
Total Stockholders’ Equity		314,945			331,721
Total Liabilities and Stockholders’ Equity	$	373,454		$	398,817

STURM, RUGER & COMPANY, INC.   CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED) (Dollars in thousands, except per share data)
	Three Months Ended						Nine Months Ended
	September 28, 2024			September 30, 2023			September 28, 2024			September 30, 2023
Net firearms sales	$	121,512		$	120,368		$	387,349		$	411,114
Net castings sales		775			525			2,519			2,036
Total net sales		122,287			120,893			389,868			413,150
Cost of products sold		99,615			96,165			308,639			311,788
Gross profit		22,672			24,728			81,229			101,362
Operating expenses:
Selling		8,998			8,669			28,188			27,702
General and administrative		9,932			9,733			32,796			31,898
Total operating expenses		18,930			18,402			60,984			59,600
Operating income		3,742			6,326			20,245			41,762
Other income:
Interest income		1,155			1,454			3,839			4,147
Interest expense		(24	)		(122	)		(66	)		(177	)
Other income, net		392			431			749			1,082
Total other income, net		1,523			1,763			4,522			5,052
Income before income taxes		5,265			8,089			24,767			46,814
Income taxes		527			658			4,681			8,848
Net income and comprehensive income	$	4,738		$	7,431		$	20,086		$	37,966
Basic earnings per share	$	0.28		$	0.42		$	1.17		$	2.14
Diluted earnings per share	$	0.28		$	0.42		$	1.15		$	2.13
Weighted average number of common shares outstanding - Basic		16,847,866			17,722,682			17,207,632			17,705,280
Weighted average number of common shares outstanding - Diluted		17,137,065			17,889,089			17,455,265			17,828,710
Cash dividends per share	$	0.19		$	0.36		$	0.58		$	6.10

STURM, RUGER & COMPANY, INC.   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Dollars in thousands)
	Nine Months Ended
	September 28, 2024			September 30, 2023
Operating Activities
Net income	$	20,086		$	37,966
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization		16,941			19,576
Stock-based compensation		3,247			2,968
Excess and obsolescence inventory reserve		39			-
Gain on sale of assets		-			(4	)
Deferred income taxes		(2,942	)		(4,058	)
Changes in operating assets and liabilities:
Trade receivables		(293	)		5,550
Inventories		3,735			(14,278	)
Trade accounts payable and accrued expenses		(514	)		(5,967	)
Contract liability with customers		(149	)		405
Employee compensation and benefits		(7,360	)		(8,129	)
Product liability		(349	)		144
Prepaid expenses, other assets and other liabilities		3,042			(15,704	)
Income taxes payable		-			(1,171	)
Cash provided by operating activities		35,483			17,298
Investing Activities
Property, plant and equipment additions		(17,196	)		(11,637	)
Proceeds from sale of assets		-			5
Purchases of short-term investments		(100,993	)		(141,410	)
Proceeds from maturities of short-term investments		115,023			194,091
Cash (used for) provided by investing activities		(3,166	)		41,049
Financing Activities
Remittance of taxes withheld from employees related to
share-based compensation		(624	)		(2,156	)
Repurchase of common stock		(29,355	)		-
Dividends paid		(9,990	)		(107,805	)
Cash used for financing activities		(39,969	)		(109,961	)
Decrease in cash and cash equivalents		(7,652	)		(51,614	)
Cash and cash equivalents at beginning of period		15,174			65,173
Cash and cash equivalents at end of period	$	7,522		$	13,559

Non-GAAP Financial Measures

In an effort to provide investors with additional information regarding its financial results, the Company refers to various United States generally accepted accounting principles (“GAAP”) financial measures and two non-GAAP financial measures, EBITDA and EBITDA margin, which management believes provides useful information to investors. These non-GAAP financial measures may not be comparable to similarly titled financial measures being disclosed by other companies. In addition, the Company believes that the non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures. The Company believes that EBITDA and EBITDA margin are useful to understanding its operating results and the ongoing performance of its underlying business, as EBITDA provides information on the Company’s ability to meet its capital expenditure and working capital requirements, and is also an indicator of profitability. The Company believes that this reporting provides better transparency and comparability to its operating results. The Company uses both GAAP and non-GAAP financial measures to evaluate the Company’s financial performance.

EBITDA is defined as earnings before interest, taxes, and depreciation and amortization. The Company calculates this by adding the amount of interest expense, income tax expense, and depreciation and amortization expenses that have been deducted from net income back into net income, and subtracting the amount of interest income that was included in net income from net income to arrive at EBITDA. The Company calculates EBITDA margin by dividing EBITDA by total net sales.

Non-GAAP Reconciliation – EBITDA

EBITDA (Unaudited, dollars in thousands)
	Three Months Ended						Nine Months Ended
	September 28, 2024			September 30, 2023			September 28, 2024			September 30, 2023
Net income	$	4,738		$	7,431		$	20,086		$	37,966
Income tax expense		527			658			4,681			8,848
Depreciation and amortization expense		5,804			6,530			16,941			19,576
Interest income		(1,155	)		(1,454	)		(3,839	)		(4,147	)
Interest expense		24			122			66			177
EBITDA	$	9,938		$	13,287		$	37,935		$	62,420
EBITDA margin		8.1	%		11.0	%		9.7	%		15.1	%
Net income margin		3.9	%		6.1	%		5.2	%		9.2	%

 

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Sturm, Ruger & Company, Inc.

One Lacey Place

Southport, CT 06890

www.ruger.com

203-259-7843

Source: Sturm, Ruger & Company, Inc.

FAQ

What was Sturm Ruger's (RGR) Q3 2024 earnings per share?

Sturm Ruger reported diluted earnings of 28¢ per share in Q3 2024.

How much dividend did RGR declare for Q3 2024?

Sturm Ruger declared a dividend of 11¢ per share for Q3 2024, payable on November 27, 2024.

What percentage of RGR's firearm sales came from new products in the first nine months of 2024?

New product sales represented 31.2% of firearm sales, totaling $113.3 million in the first nine months of 2024.

How much cash does Sturm Ruger (RGR) have as of Q3 2024?

As of September 28, 2024, Sturm Ruger had $96.0 million in cash and short-term investments.