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the financial health of our customers;
−Removed: disruptions or delays in our business operations, including without limitation disruptions or delays in our supply chain, arising from political unrest, war, labor strikes, natural disasters, public health crises such as the coronavirus pandemic, and other events and circumstances beyond our control;
+Added: disruptions or delays in our business operations, including without limitation disruptions or delays in our supply chain, arising from political unrest, war, terrorism, labor strikes, natural disasters, public health crises such as the coronavirus pandemic, and other events and circumstances beyond our control;
the impact of management’s conclusion, in consultation with the Audit Committee, that material weaknesses existed in the Company’s internal control procedures over financial reporting;
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the potential impact of actual or perceived defects in, or safety of, our products, including any impact of product recalls or legal or regulatory claims, proceedings or investigations involving our products;
−Removed: risks related to data security of privacy breaches;
+Added: risks related to data security or privacy breaches;
the potential impact of regulatory claims, proceedings or investigations involving our products;
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Management cannot predict the full impact of these factors on the Company.
−Removed: Due to the above circumstances and as described generally in this Form 10-Q, the Company’s results of operations for the period ended March 31, 2024 are not necessarily indicative of the results to be expected for fiscal year 2024.
+Added: Due to the above circumstances and as described generally in this Form 10-Q, the Company’s results of operations for the period ended June 30, 2024 are not necessarily indicative of the results to be expected for fiscal year 2024.
Results of Operations
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Three Months Ended
−Removed: March 31, 2024
−Removed: March 31, 2023
+Added: Six Months Ended
+Added: June 30, 2024
+Added: June 30, 2023
+Added: June 30, 2024
+Added: June 30, 2023
Cost of products sold
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Revenue and Gross Margin
−Removed: Sales increased 0.7% for the first quarter of 2024, compared with the same period in the prior year.
−Removed: Sales increased across several product categories, largely in the outdoor and game related.
−Removed: These increases were partially offset by decreases in indoor and licensed product category sales.
−Removed: Gross margin increased to 25.0% for the first quarter of 2024 compared to 19.4% for the same period in 2024 primarily driven by more favorable product mix, decreased inventory storage and handling costs, and more favorable absorption.
+Added: Total net sales declined 7.7% on a year-over-year basis in the second quarter, due to softening consumer demand and channel inventory destocking, particularly in our indoor/outdoor games categories, partly offset by growth in our Stiga table tennis, Bear Archery, and Brunswick Billiards brands.
+Added: Mass merchant, specialty dealer and third-party e-commerce channel sales were all soft during the quarter, partly offset by 15% growth in international sales and 28% growth in our owned e-commerce sales.
+Added: For the first six months of 2024, total net sales declined 3.9% compared to the first half of 2023 again due to softening consumer demand and channel destocking, partly offset by growth in our table tennis, basketball, and archery categories.
+Added: Gross margin decreased to 24.2% for the second quarter of 2024 compared to 24.6% for the same period in 2023 primarily driven by lower fixed cost absorption, increased customer program spending, and severance related expenses associated with the Company’s ongoing asset optimization initiative.
Selling, General and Administrative Expenses
−Removed: Selling, general and administrative expenses (SG&A) were $10.7 million for the first quarter of 2024 compared to $10.3 million for the same period in the prior year, an increase of $0.4 million or 4.1%.
−Removed: SG&A as a percent of sales is 18.7% for the first quarter of 2024 compared with 18.0% for the same period in the prior year.
−Removed: Provision (Benefit) for Income Taxes
−Removed: The effective tax rate for the first three months of 2024 was 23.8% compared to 21.2% for the same period last year.
+Added: Selling, general and administrative expenses (SG&A) were $10.1 million for the second quarter of 2024 compared to $9.8 million for the same period in the prior year, an increase of $0.3 million or 3.0%.
+Added: SG&A as a percent of sales is 16.1% for the second quarter of 2024 compared with 14.5% for the same period in the prior year.
+Added: For the first six months of 2024, SG&A were $20.8 million compared to $20.1 million for the same period in the prior year, an increase of $0.7 million, or 3.6%.
+Added: SG&A as a percent of sales is 17.3% for the first six months of 2024 compared with 16.1% for the same period in the prior year.
+Added: Provision for Income Taxes
+Added: The effective tax rate for the first six months of 2024 was 23.8% compared to 22.6% for the same period last year.
Financial Condition and Liquidity
−Removed: Total debt at the end of the first three months of 2024 was $53.5 million, an increase of $2.6 million from December 31, 2023.
+Added: Total debt as of June 30, 2024 was $43.2 million, a decrease of $7.7 million from December 31, 2023.
The following schedule summarizes the Company’s total debt:
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Long term debt
−Removed: As a percentage of stockholders’ equity, total debt was 32.5%, 30.9% and 60.9% at March 31, 2024, December 31, 2023, and March 31, 2023 respectively.
+Added: As a percentage of stockholders’ equity, total debt was 26.0%, 30.9% and 53.0% at June 30, 2024, December 31, 2023, and June 30, 2023 respectively.
On January 21, 2022, the Company and its wholly owned subsidiary, Indian Industries, Inc.
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As reflected in the Fourth Amendment to the Restated Credit Agreement effective September 1, 2023, the maximum availability of the senior revolving credit facility was reduced to $85.0 million following the dissolution of Escalade Insurance, Inc.
−Removed: As of March 31, 2024, the outstanding principal amount of the term loan was $31.0 million and total amount drawn under the Revolving Facility was $22.5 million.
+Added: The Company was in compliance with the debt covenants set forth in the Restated Credit Agreement as of June 30, 2024.
+Added: As of June 30, 2024, the outstanding principal amount of the term loan was $29.2 million and total amount drawn under the Revolving Facility was $14.0 million.
The Company funds working capital requirements and shareholder dividends through operating cash flows and revolving credit agreements with its Lenders.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.