What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2021-12-10 compared with 2020-12-11 · 89 added, 89 removed, 193 unchanged (48% of the section changed)

6 unchanged sentences

Coronavirus (COVID-19)

Due to the timing of the COVID-19 outbreak, the Company's primary-selling season during fiscal 2020 was interrupted resulting in a significant shift in sales volumes during the 2020 fiscal year toward the latter half of that fiscal year versus the

prior year period where our heaviest sales volumes occurred during our second and third fiscal quarters.

As stay at home restrictions were lifted, the Company saw an increase in demand for many of its warm weather outdoor recreational products later during fiscal 2020 as consumers took advantage of being outdoors.

As a result, each of our Fishing, Camping and Watercraft Recreation segments experienced strong demand in the latter half of the current fiscal year.

Due to the unique aspects of this pandemic and the various government prescriptions for the general public to maintain social distancing and avoid activities involving large crowds or being in confined spaces with others to mitigate the spread of the virus, the warm weather outdoor recreation industry benefited from increased participation in outdoor recreation activities.

While it is difficult to know the longer-term impacts from the COVID-19 pandemic on demand for the Company's products, as a Company with product offerings in several segments that allow consumers to engage in socially distant and relatively pandemic-safe activities outdoors, the Company intends to leverage the current situation with disciplined investments for future, long-term growth in spite of the ongoing COVID-19 pandemic.

The Company's fiscal year ended October 2, 2020 comprised 53 weeks, whereas fiscal 2019 and 2018 each comprised 52 weeks.

As a result, each of our Fishing, Camping and Watercraft Recreation segments experienced strong demand in the latter half of fiscal 2020.

This demand continued into and throughout our fiscal 2021, resulting in increased sales volumes across all Company segments in fiscal 2021.

In addition to this significant increase in demand for Company products during fiscal 2021, COVID-19 has also caused widely-documented supply chain and logistics disruptions across industries, including those in which we operate, which have been exacerbated during the latter half of fiscal 2021 and into our fiscal 2022 due to the recent higher demand for our outdoor recreation products and associated inventory replenishment actions of our customers.

These adverse supply chain constraints and disruptions have impacted the timing, sourcing, availability and cost of raw materials and components that are necessary to manufacture our outdoor recreation products.

Specifically, during the fourth quarter of fiscal 2021, certain of the Company's component suppliers and logistical service providers experienced disruptions, resulting in supply shortages across all of our segments for certain materials and components that are necessary to produce our products.

As a result of these disruptions, starting during the latter portion of fiscal 2021, the Company took action to closely monitor its supply chain in order to meet the continued strong consumer demand and to attempt to continue to fulfill orders.

These actions included building and procuring numerous categories of inventory (in some cases at significantly higher price points than what was historically paid) to mitigate against potential shortages during fiscal 2022 in certain of its materials and components that are necessary to manufacture Company products.

These buying actions have resulted in the Company carrying significantly higher levels of inventory for a number of its materials, components and products at the end of fiscal 2021.

Because the Company expects that these same supply chain disruptions will continue into fiscal 2022, the Company remains focused on evaluating and pursuing additional options (beyond building inventory) to manage its supply chain to meet the continued strong consumer demand for its products.

Nonetheless, these supply chain disruptions remain fluid and will likely impact the cost of goods sold for future sales of product or the Company’s ability to fill all customer demand for its products, especially given the volatility and changing circumstances brought on by the COVID-19 pandemic.

The Company's prior fiscal year ended October 2, 2020 comprised 53 weeks, whereas fiscal 2021 and 2019 each comprised 52 weeks.

The additional week in fiscal 2020 increased net sales by less than 2% over the prior year.

8 unchanged sentences

Operating profit 111,283 71,070 63,774

Interest expense 143 172 203

Interest income, net (221) (1,270) (1,937)

Other income, net (1,418) (1,362) (796)

20 unchanged sentences

Net sales in 2021 increased by 26% to $751,651 compared to $594,209 in 2020.

The additional week in the fiscal year drove an increase in net sales of approximately 1.5% over the prior year.

Foreign currency exchange had a $651 unfavorable impact, less than 1%, on the current year’s sales versus the prior year.

Foreign currency exchange had a favorable impact of less than 1%, on the current year’s sales versus the prior year.

Net sales for the Fishing business increased by $103,122, or 23% during 2021 from 2020.

Increased demand late in the fiscal year was more than enough to overcome the impact of COVID-19 related restrictions and shutdowns earlier in the fiscal year, resulting in the increase in the current year over the prior year.

The increase over the prior year was driven by continued new product success and increased participation in fishing, principally as a result of the effect of COVID-19 on consumer recreation and leisure choices, resulting in higher demand across all product lines in this segment.

Camping net sales increased $21,329, or 51%, in 2021 from 2020.

Increased sales of consumer tents and Jetboil products as a result of increased participation in outdoor recreation activities were more than enough to overcome declines in military tent sales year over year.

Increased sales of consumer tents and Jetboil products as a result of increased participation in outdoor recreation activities were the primary driver of the increase year over year.

Net sales in the Watercraft Recreation business increased $24,746, or 59%.

Despite COVID-19 related shutdowns earlier in the year, increased demand later in the year drove the overall increase over the prior year.

See "Coronavirus (COVID-19)" above for more information regarding the impact the COVID-19 pandemic had on our fiscal 2020 sales.

Diving net sales decreased $15,433, or 20%, year over year.

The decrease is largely due to the effects of COVID-19 on demand globally due to restrictions in destination travel and tourism.

In addition, foreign currency translation negatively impacted sales by approximately 1% in 2020 versus the prior year period.

Increased demand as a result of increased participation in watercraft recreation activities during the COVID-19 pandemic, combined with new product success, drove the overall increase over the prior year.

Diving net sales increased $8,574, or 14%, year over year.

Prior year sales were negatively impacted due to the effects of COVID-19 on demand globally due to restrictions in destination travel and tourism.

As travel restrictions started to lift throughout fiscal 2021, tourism has begun to recover, resulting in increased demand and sales in this segment over the prior year.

In addition, foreign currency translation favorably impacted sales by approximately 3.3% in 2021 versus the prior year period.

Cost of Sales

1 unchanged sentence

Higher sales volumes between years were the primary driver of the increase in the cost of sales between periods.

Additionally, the impact of approximately $2,000 of additional tariffs during fiscal 2020, which have increased our cost of sales, on Chinese goods and components over the prior year was offset by favorable product mix and pricing between fiscal years.

Favorable product mix and pricing between fiscal years offset the impact of approximately $7,200 of additional tariffs on Chinese goods and components during fiscal 2021, as well as increased freight costs over the prior year.

Gross profit of $334,125 was 44.5% of net sales on a consolidated basis for the year ended October 1, 2021 compared to $264,993, or 44.6% of net sales in the prior year.

Gross profit in the Fishing business increased by $39,676 from the prior year due primarily to the 23% increase in net sales year over year.

The recovery of overpayments of excise taxes during fiscal 2020 more than offset approximately $1,000 of new tariff costs on Chinese sourced goods and components incurred during fiscal 2020.

Camping gross profit increased by $1,321 from 2019 due primarily to increased sales volumes and a favorable mix of products sold in the current year as compared to the prior year.

Favorable product mix and improved absorption of overhead costs during fiscal 2021 partially offset approximately $5,900 of additional tariff costs on Chinese sourced goods and components and higher freight costs incurred during fiscal 2021 versus fiscal 2020.

Camping gross profit increased by $11,497 from 2020 due primarily to increased sales volumes, pricing actions and a favorable mix of products sold in the current year as compared to the prior year.

Gross profit in the Watercraft Recreation segment increased by $12,289 from 2020 due primarily to increased sales volumes in 2021 versus the prior year and the resulting improvement in absorption of overhead costs.

The $8,467 decrease in gross profit in the Diving segment was due primarily to decreased sales volumes during fiscal 2020 as compared to the prior year.

The $5,463 increase in gross profit in the Diving segment was due primarily to increased sales volumes, pricing actions and favorable product mix during fiscal 2021 as compared to the prior year.

Operating Expenses

1 unchanged sentence

The increase was driven primarily by higher sales volume related costs incurred in fiscal 2021 as compared to the prior fiscal year.

Additionally, increased headcount and people costs further increased expenses year over year.

Additionally, increased headcount and compensation costs further increased expenses year over year.

Operating expenses for the Fishing segment increased by $13,069 from fiscal 2020 levels.

The increase was due primarily to higher sales volume related expenses between years and increased headcount related expenses incurred in fiscal 2020.

Camping operating expenses decreased by $189 from the prior year due primarily to efforts to reduce spending in light of COVID-19 uncertainties during the current year, primarily as it related to travel, entertainment and advertising expenses.

In the Watercraft Recreation segment, operating expenses increased $1,347 from their levels in fiscal 2019 due primarily to increased sales volume related expenses in 2020.

Operating expenses for the Diving business decreased by $2,848 year over year due primarily to lower sales volume related expenses, as well as lower headcount related expenses between periods.

The increase was due primarily to higher sales volume related expenses, as well as increased people costs between years.

Camping operating expenses increased by $1,879 from the prior year due primarily to increased sales volume related expenses.

In the Watercraft Recreation segment, operating expenses increased $2,787 from their levels in fiscal 2020 due primarily to increased sales volume related expenses in 2021, partially offset by decreased spending rate on advertising and promotions.

Operating expenses for the Diving business increased by $1,357 year over year due primarily to increased sales volume related expenses, as well as increased people costs between periods.

The Company's 2021 general corporate expenses of $36,317 increased $9,827 from $26,490 in 2020.

The year over year increase primarily reflects $1,800 of higher deferred compensation expenses, as well as higher health insurance costs offset in part by decreased investment in marketing support over the prior year.

The year over year increase reflects higher people costs including $2,900 of higher deferred compensation expenses and higher health insurance costs over the prior year as well as higher professional services expense.

Operating Results

2 unchanged sentences

The operating profit for Camping was $14,025 compared to $4,406 in 2020 which increase was also primarily a result of higher sales volumes between periods.

The operating loss for the Watercraft Recreation business was $329 in fiscal 2020 compared to a loss of $2,822 in fiscal 2019 due to the factors noted above on changes in sales volumes and operating expenses.

Operating profit for the Diving business decreased by $5,619 in fiscal 2020 from fiscal 2019, due to the impact of COVID-19 and demand for our Diving products and the other factors discussed above.

The operating profit for the Watercraft Recreation business was $9,173 in fiscal 2021 compared to a loss of $329 in fiscal 2020 due to the factors noted above on changes in sales volumes and operating expenses.

Operating profit for the Diving business increased by $4,106 in fiscal 2021 from fiscal 2020, due to recovery from the impact of COVID-19 and demand for our Diving products and the other factors discussed above.

Other Income and Expenses

Interest expense of $143 declined slightly from the prior year expense of $172.

Interest income of $1,413 decreased from prior year interest income of $2,109 due to declining interest rates in 2020.

Net other income of $1,362 in fiscal 2020 increased from net other income of $796 in fiscal 2019.

The current year net other income included currency losses of $269 and market gains and dividends of $2,454 on deferred compensation plan assets.

In the prior year, net other income included $645 of currency gains and $610 of market gains and dividends on the deferred compensation plan assets.

Interest expense of $145 was relatively flat as compared to the prior year expense of $143.

Interest income of $366 decreased from prior year interest income of $1,413 due to the decrease in deposit interest rates year over year.

Net other income of $1,418 in fiscal 2021 increased slightly from net other income of $1,362 in fiscal 2020.

The current year net other income included currency losses of $215 and market gains and dividends of $5,329 on deferred compensation plan assets, partially offset by pension termination expense of $2,526.

In the prior year, net other income included $269 of currency losses and $2,454 of market gains and dividends on the deferred compensation plan assets.

The dividends and market gains and losses on deferred compensation plan assets recognized in the Consolidated Statement of Operations in “Other income, net” are offset as compensation expense in “Operating expenses.”

5 unchanged sentences

Net sales in 2020 increased by 6% to $594,209 compared to $562,419 in 2019.

Foreign currency exchange had a $3,170 unfavorable impact, less than 1%, on the 2019 fiscal year’s sales versus the prior year.

The additional week in the fiscal year drove an increase in net sales of approximately 1.5% over fiscal 2019.

Foreign currency exchange had a $651 unfavorable impact, less than 1%, on 2020 fiscal year’s sales versus 2019.

Net sales for the Fishing business increased by $37,757, or 9% during 2020 from 2019.

Strong performance of new products, particularly from the Humminbird brand, drove the growth over the prior year.

Increased demand late in fiscal 2020 was more than enough to overcome the impact of COVID-19 related restrictions and shutdowns earlier in 2020, resulting in the increase between years.

Camping net sales increased $1,213, or 3%, in 2020 from 2019.

Increased military tent sales, as well as increased sales of Jetboil products over the prior year were the primary drivers for growth year over year.

Net sales in the Watercraft Recreation business decreased $2,782, or 8%, between years due to a weakened paddling market and lost distribution related to retail consolidations.

Diving net sales decreased $2,626, or 3%, year over year.

Growth in the US market was more than offset by declines in the Asia market and foreign currency translation, which negatively impacted sales by 3% in 2019 versus the prior year period.

Net sales in the Watercraft Recreation business increased $8,359, or 25% in 2020 from 2019.

Despite COVID-19 related shutdowns early in fiscal 2020, increased demand later in the year drove the overall increase over 2019.

See "Coronavirus (COVID-19)" above for more information regarding the impact the COVID-19 pandemic had on our fiscal 2020 sales.

Diving net sales decreased $15,433, or 20%, from 2020 to 2019.

The decrease was largely due to the effects of COVID-19 on demand globally due to restrictions during 2020 in destination travel and tourism.

In addition, foreign currency translation negatively impacted sales by approximately 1% in 2020 versus 2019.

Cost of Sales

Cost of sales was $329,216, or 55.4% of net sales, on a consolidated basis for fiscal 2020 compared to $312,663, or 55.6% of net sales, in the prior year.

Higher sales volumes between years were the primary driver of the increase in the cost of sales.

Additionally, the impact of approximately $2,900 of additional tariffs during 2019, which increased our cost of sales, on Chinese goods and components over the prior year was offset by favorable product mix and pricing between fiscal years.

Gross profit of $249,756 was 44.4% of net sales on a consolidated basis for the year ended September 27, 2019 compared to $241,860, or 44.4% of net sales in the prior year.

Gross profit in the Fishing business increased by $7,896 in 2019 from the prior year due primarily to the 5% increase in net sales year over year.

A sales mix shift to higher value new products during fiscal 2019 more than offset the effect of approximately $2,600 of new tariffs on Chinese sourced goods and components.

Camping gross profit increased in 2019 by $1,390 from 2018 due primarily to increased sales volume between years, a favorable mix of products sold and fewer closeouts in the current year as compared to the prior year.

Gross profit in the Watercraft Recreation segment decreased in 2019 by $928 from 2018 levels due primarily to lower sales volumes occurring during 2019.

The $465 decrease in gross profit in the Diving segment was due primarily to the unfavorable impact of foreign currency translation in that segment during fiscal 2019.

Higher sales volumes between years were the primary driver of the increase in the cost of sales between periods.

Additionally, the impact of approximately $2,000 of additional tariffs during fiscal 2020, which increased our cost of sales, on Chinese goods and components over the prior year was offset by favorable product mix and pricing between fiscal years.

Gross profit of $264,993 was 44.6% of net sales on a consolidated basis for the year ended October 2, 2020 compared to $249,756, or 44.4% of net sales in fiscal 2019.

Gross profit in the Fishing business increased by $18,625 from 2019 to 2020 due primarily to the 9% increase in net sales year over year.

The recovery of overpayments of excise taxes during fiscal 2020 more than offset approximately $1,000 of new tariff costs on Chinese sourced goods and components incurred during fiscal 2020.

Camping gross profit in fiscal 2020 increased by $1,321 from 2019 due primarily to increased sales volumes and a favorable mix of products sold in fiscal 2020 as compared to fiscal 2019.

Gross profit in the Watercraft Recreation segment increased in fiscal 2020 by $3,840 from 2019 due primarily to increased sales volumes in 2020 versus 2019 and the resulting improvement in absorption of overhead costs.

The $8,467 decrease in gross profit in the Diving segment from 2019 to 2020 was due primarily to decreased sales volumes during fiscal 2020 as compared to fiscal 2019.

Operating Expenses

Operating expenses increased in 2019 from the prior year by $7,143.

The increase was driven primarily by higher sales volume related costs and bad debt expenses incurred in fiscal 2019.

Additionally, investment in marketing support further increased expenses year over year.

Operating expenses for the Fishing segment increased in 2019 by $7,501 from fiscal 2018 levels.

The increase was due primarily to higher sales volume related expenses and bad debt expenses incurred in fiscal 2019.

In addition, higher research and development expenses further contributed to the increase between years.

Camping operating expenses increased in 2019 by $361 from the prior year due primarily to increased sales volume related expenses in 2019.

In the Watercraft Recreation segment, operating expenses increased $339 from their levels in fiscal 2018 due primarily to increased advertising and freight expenses in 2019.

Operating expenses for the Diving business decreased by $740 year over year due primarily to lower headcount related expenses between periods.

The Company's 2019 general corporate expenses of $23,691 decreased $317 from $24,008 in 2018.

The year over year decrease primarily reflects lower deferred compensation and health insurance costs offset in part by investment in marketing support.

Operating expenses increased during fiscal 2020 from 2019 by $7,941.

The increase was driven primarily by higher sales volume related costs incurred in fiscal 2020 as compared to the fiscal 2019.

Additionally, increased headcount and people costs further increased expenses year over year.

Operating expenses for the Fishing segment increased in fiscal 2020 by $6,832 from fiscal 2019 levels.

The increase was due primarily to higher sales volume related expenses between years and increased headcount related expenses incurred in fiscal 2020.

Camping operating expenses decreased in fiscal 2020 by $189 from 2019 due primarily to efforts to reduce spending in light of COVID-19 uncertainties during 2020, primarily as it related to travel, entertainment and advertising expenses.

In the Watercraft Recreation segment, fiscal 2020 operating expenses increased $1,347 from their levels in fiscal 2019 due primarily to increased sales volume related expenses in 2020.

Operating expenses for the Diving business decreased by $2,848 year over year due primarily to lower sales volume related expenses, as well as lower headcount related expenses between periods.

The Company's fiscal 2020 general corporate expenses of $26,490 increased $2,799 from $23,961 in 2019.

Operating Results

The Company’s operating profit was $71,070 in fiscal 2020 compared to an operating profit of $63,774 in fiscal 2019.

Fishing operating profit increased in 2019 by $396 to $84,092 from $83,696 in 2018 due primarily to higher sales volumes between years.

The operating profit for Camping was $2,896 in 2019 compared to $1,867 in 2018 which increase was due primarily as a result of higher sales volumes between periods.

The operating loss for the Watercraft Recreation business was $2,822 in fiscal 2019 compared to a loss of $1,555 in fiscal 2018 due to the factors noted above.

Operating profit for the Diving business increased by $277 in fiscal 2019 from fiscal 2018.

Fishing operating profit increased by $11,792 to $95,884 in fiscal 2020 from $84,092 in fiscal 2019 due primarily to higher sales volumes between years.

The operating profit for Camping in fiscal 2020 was $4,406 compared to $2,896 in 2019 which increase was also primarily a result of higher sales volumes between periods.

Operating profit for the Diving business decreased by $5,619 in fiscal 2020 from fiscal 2019, due to the impact of COVID-19 and demand for our Diving products and the other factors discussed above.

Other Income and Expenses

Interest expense of $172 in 2019 declined slightly from the prior year expense of $203.

Interest income of $2,109 in 2019 increased from 2018 interest income of $1,166 due to the increase in cash and cash equivalents and rising interest rates in 2019.

Net other income of $796 in fiscal 2019 decreased from net other income of $4,122 in fiscal 2018.

The current year other income during 2019 included currency gains of $645 and market gains and dividends of $610 on deferred compensation plan assets.

In 2018, other income included $1,985 of currency gains and $1,734 of market gains and dividends on the deferred compensation plan assets.

Interest expense in fiscal 2020 of $143 declined slightly from 2019 expense of $172.

Interest income in fiscal 2020 of $1,413 decreased from 2019 interest income of $2,109 due to declining interest rates in 2020.

Net other income of $1,362 in fiscal 2020 increased from net other income of $796 in fiscal 2019.

Fiscal 2020 net other income included currency losses of $269 and market gains and dividends of $2,454 on deferred compensation plan assets.

In fiscal 2019, net other income included $645 of currency gains and $610 of market gains and dividends on the deferred compensation plan assets.

2 unchanged sentences

The Company recorded income tax expense of $18,469 in 2020, which equated to an effective tax rate of 25.1%, compared to $15,094 in 2019, which equated to an effective tax rate of 22.7%.

The fiscal 2018 expense reflects the impact of provisional tax expense of $8,456 from the enactment of U.S.

Tax Cuts & Jobs Act during the prior year.

The Company recognized net income of $55,233, or $5.47 per diluted common share, in fiscal 2020 compared to $51,413, or $5.11 per diluted common share, in fiscal 2019 based on the factors discussed above.

7 unchanged sentences

(thousands) October 1

2020 September 27

2021 October 2

2020 September 27

4 unchanged sentences

Effect of foreign currency rate changes on cash 107 1,256 (1,142)

Increase (decrease) in cash and cash equivalents $ 40,055 $ 50,505 $ 58,067

Increase in cash and cash equivalents $ 28,011 $ 40,055 $ 50,505

Operating Activities

1 unchanged sentence

(thousands, except share data) October 1

2020 September 27

2021 October 2

Current assets $ 491,264 $ 388,538

3 unchanged sentences

Cash flows provided by operations totaled $58,318, $61,493 and $45,844 in fiscal 2021, 2020 and 2019, respectively.

Cash flows provided by operations increased from the prior year due primarily to an increase in net income in fiscal 2020, as well as working capital changes.

Cash flows provided by operations decreased slightly from the prior year despite an increase in net income due primarily to increases in inventory levels and other working capital changes.

Depreciation and amortization charges were $13,401, $14,926 and $13,964 in fiscal 2021, 2020 and 2019, respectively.

Investing Activities

Cash flows used for investing activities were $15,587 in fiscal 2020, and cash flows provided by investing activities were $11,989, and $48 in fiscal 2019, and 2018, respectively.

There were no sales or purchases of short-term investments in fiscal 2020, while proceeds from the sale of short-term investments in 2019 provided cash of $35,838, offset by purchases of $7,124.

In fiscal 2018, the sale of short-term investments provided cash of $52,682, offset by purchases of $34,789.

Cash flows used for investing activities were $21,381 and $15,587 in fiscal 2021 and 2020, respectively, and cash flows provided by investing activities were $11,989 in 2019.

There were no sales or purchases of short-term investments in fiscal 2021 or 2020, while proceeds from the sale of short-term investments in 2019 provided cash of $35,838, offset by purchases of $7,124.

Expenditures for property, plant and equipment were $21,409, $15,600 and $16,786 in fiscal 2021, 2020 and 2019, respectively.

In general, the Company’s ongoing capital expenditures are primarily related to tooling for new products and facilities and information systems improvements.

In general, the Company’s ongoing capital expenditures are primarily related to tooling for new products, facilities investments and information systems improvements.

Financing Activities

3 unchanged sentences

The Company has contractual obligations and commitments to make future payments under its operating leases and open purchase orders.

The following schedule details these significant contractual obligations at October 2, 2020.

Total Less than 1 year 2-3 years 4-5 years After 5 years

Operating lease obligations $ 47,996 $ 8,025 $ 9,556 $ 8,193 $ 22,222

Open purchase orders 120,376 120,376 — — —

Contractually obligated interest payments 240 113 127 — —

Total contractual obligations $ 168,612 $ 128,514 $ 9,683 $ 8,193 $ 22,222

There have been no changes outside of the ordinary course of business in the specified contractual obligations during the year ended October 1, 2021.

The Company utilizes letters of credit primarily as security for the payment of future claims under its workers’ compensation insurance.

Letters of credit outstanding at October 2, 2020 and September 27, 2019 were $181 and $181, respectively, and were

Letters of credit outstanding at October 1, 2021 and October 2, 2020 were $181 and $181, respectively, and were

included in the Company’s total loan availability.

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of October 2, 2020 or September 27, 2019.

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of October 1, 2021 or October 2, 2020.

The Company anticipates making contributions of approximately $96 to its defined benefit pension plans through September 30, 2022.

The Company has no other off-balance sheet arrangements.

The Company anticipates making contributions of approximately $171 to its defined benefit pension plans through October 2, 2020.

Market Risk Management

1 unchanged sentence

As disclosed in our prior filings with the Securities and Exchange Commission and elsewhere herein, in December 2019, a new strain of coronavirus ("COVID-19"), began to spread globally, leaving no region or part of the world unaffected by the pandemic it has created.

Governments and health authorities have been taking, and continue to take, measures to prevent the spread of this virus, but it is presently unknown to what extent they will be successful or the potential timing of these measures and their outcome and impact on the Company's business in the future.

If COVID-19 is not contained, among other things, the ability of the Company’s suppliers to manufacture and deliver the products that it sells to the Company, the ability of the Company to manufacture and deliver its products to its customers, the Company's ability to display its products at trade shows and similar events, the Company's ability to conduct meetings with its customers and prospective customers, and, if a significant number of its employees at a particular facility or location were to contract coronavirus, the Company’s ability to conduct its day-to-day operations could be adversely impacted.

The financial impact of coronavirus on the Company will depend on future developments and cannot be reasonably predicted or estimated at this time, but could materially and adversely affect its results for an unknown but possibly extended period.

Governments and health authorities have been taking, and continue to take, measures to prevent the spread of this virus (including in certain cases requiring or recommending a vaccine or imposing testing requirements), but it is presently unknown to what extent they will be successful or the potential timing of these measures and their outcome and impact on the Company's business in the future.

To the extent that COVID-19 continues to persist, among other things, the ability of the Company’s suppliers to manufacture and deliver the products that it sells to the Company, the ability of the Company to manufacture and deliver its products to its customers, the Company's ability to display its products at trade shows and similar events, the Company's ability to conduct meetings with its customers and prospective customers, and, if a significant number of its employees at a particular facility or location were to contract coronavirus, the Company’s ability to conduct its day-to-day operations could be adversely impacted.

The financial impact of the coronavirus pandemic on the Company will depend on future developments, including related to any supply chain disruptions, that the Company cannot reasonably predict or estimate at this time, but any of which could materially and adversely affect its results for an unknown but possibly extended period.

See the section "Risk Factors" identified in Part I, Item 1A in this Form 10-K for more information.

77 unchanged sentences

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.

What changed 10-K

Item 7. Management’s Discussion and Analysis