What changed in this filing

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Item 1. Financial Statements

2023-05-05 compared with 2023-02-03 · 138 added, 99 removed, 422 unchanged (36% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

(thousands, except per share data) December 30, 2022 December 31, 2021

Three Months Ended Six Months Ended

(thousands, except per share data) March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Net sales $ 202,115 $ 189,623 $ 380,452 $ 343,147

9 unchanged sentences

Interest expense 38 49 75 87

Other income, net ( 1,904 ) ( 774 )

Other (income) expense, net ( 7,861 ) 2,272 ( 9,765 ) 1,498

Profit before income taxes 19,948 13,210 28,114 27,799

15 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

(thousands) December 30, 2022 December 31, 2021

Three Months Ended Six Months Ended

(thousands) March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Net income $ 14,861 $ 9,900 $ 20,740 $ 20,756

8 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(thousands, except share data) December 30, 2022 September 30, 2022 December 31, 2021

(thousands, except share data) March 31, 2023 September 30, 2022 April 1, 2022

Current assets:

47 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

Three Months Ended December 30, 2022

Six Months Ended March 31, 2023

(thousands except for shares) Shares Common Stock Capital in

13 unchanged sentences

BALANCE AT DECEMBER 30, 2022 10,241,237 $ 514 $ 86,923 $ 405,574 $ 3,565 $ ( 2,355 )

Three Months Ended December 31, 2021

Net income — — — 14,861 — —

Dividends declared — — — ( 3,161 ) — —

Award of non-vested shares 13,674 — ( 744 ) — — 744

Stock-based compensation — — 971 — — —

Currency translation adjustment — — — — 507 —

Change in pension plans, net of tax of $ 3

BALANCE AT MARCH 31, 2023 10,254,911 $ 514 $ 87,150 $ 417,274 $ 4,080 $ ( 1,611 )

Six Months Ended April 1, 2022

(thousands except for shares) Shares Common Stock Capital in

14 unchanged sentences

BALANCE AT DECEMBER 31, 2021 10,157,045 $ 510 $ 83,869 $ 378,352 $ 6,979 $ ( 3,097 )

Net income — — — 9,900 — —

Dividends declared — — — ( 3,023 ) — —

Award of non-vested shares 13,493 1 — — — —

Stock-based compensation — — 959 — — —

Currency translation adjustment — — — — 168 —

Change in pension plans, net of tax of $ 6

Non-vested stock forfeitures ( 2,040 ) — 150 — — ( 150 )

Purchase of treasury stock at cost ( 512 ) — — — — ( 48 )

BALANCE AT APRIL 1, 2022 10,167,986 $ 511 $ 84,978 $ 385,229 $ 7,163 $ ( 3,295 )

The accompanying notes are an integral part of the condensed consolidated financial statements.

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended

(thousands) December 30, 2022 December 31, 2021

Six Months Ended

(thousands) March 31, 2023 April 1, 2022

CASH USED FOR OPERATING ACTIVITIES

5 unchanged sentences

Stock based compensation 1,924 2,085

Loss on disposal of productive assets 71 1

Gain on disposal of productive assets ( 6,568 ) ( 1 )

Deferred income taxes ( 4 ) ( 4 )

4 unchanged sentences

Other current assets 2,616 1,613

Other non-current assets ( 10 ) —

Other long-term liabilities ( 117 ) ( 2,558 )

1 unchanged sentence

( 18,095 ) ( 104,648 )

CASH USED FOR INVESTING ACTIVITIES

CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES

Proceeds from sale of productive assets 14,990 2

Capital expenditures ( 13,998 ) ( 15,724 )

11 unchanged sentences

Non-cash treasury stock activity $ 2,123 $ —

Non-cash dividends 21 9

Cash paid for taxes 8,493 12,422

6 unchanged sentences

In the opinion of management, these statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly the financial position of Johnson Outdoors Inc.

and subsidiaries (collectively, the “Company”) as of December 30, 2022 and December 31, 2021, and their results of operations for the three month periods then ended and cash flows for the three month periods then ended.

and subsidiaries (collectively, the “Company”) as of March 31, 2023 and April 1, 2022, and their results of operations for the three and six month periods then ended and cash flows for the six month periods then ended.

These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2022 which was filed with the Securities and Exchange Commission on December 9, 2022.

Due to seasonal variations and other factors, some of which are described herein, including related to the aftereffects of the COVID-19 pandemic and the ensuing related disruptions to the global supply chains and logistics infrastructure, and the current inflationary environment (especially as it relates to the cost of raw materials and purchased components), the results of operations for the three months ended December 30, 2022 are not necessarily indicative of the results to be expected for the Company’s full 2023 fiscal year.

Due to seasonal variations and other factors, some of which are described herein, including related to the aftereffects of the COVID-19 pandemic and the ensuing related disruptions to the global supply chains and logistics infrastructure, and the current inflationary environment (especially as it relates to the cost of raw materials and purchased components), the results of operations for the three and six months ended March 31, 2023 are not necessarily indicative of the results to be expected for the Company’s full 2023 fiscal year.

The current economic and business environment, including as it relates to inflationary pressures, combined with the continued impact of the pandemic on the global supply chain (specifically with respect to the sourcing, timing, availability and cost of raw materials and components that are necessary to manufacture our products) is beyond our control and remains highly uncertain and cannot be predicted at this time.

4 unchanged sentences

2 ACCOUNTS RECEIVABLE

Accounts receivable are stated net of allowances for doubtful accounts of $ 1,151 , $ 1,037 and $ 2,662 as of December 30, 2022, September 30, 2022 and December 31, 2021, respectively.

The increase in net accounts receivable to $ 120,553 as of December 30, 2022 from $ 91,919 as of September 30, 2022 is attributable to the seasonal nature of the Company’s business.

Accounts receivable are stated net of allowances for doubtful accounts of $ 1,121 , $ 1,037 and $ 1,504 as of March 31, 2023, September 30, 2022 and April 1, 2022, respectively.

The increase in net accounts receivable to $ 144,600 as of March 31, 2023 from $ 91,919 as of September 30, 2022 is primarily attributable to the seasonal nature of the Company’s business.

The determination of the allowance for doubtful accounts is based on a combination of factors.

14 unchanged sentences

In periods where there is a cumulative year to date net loss or no undistributed income because distributions through dividends exceed net income, Class B shares are treated as anti-dilutive and, therefore, net losses are allocated equally on a per share basis among all participating securities.

For the three month periods ended December 30, 2022 and December 31, 2021, basic income per share for the Class A and Class B shares has been presented using the two class method and reflects the allocation of undistributed income described above.

For the three and six month periods ended March 31, 2023 and April 1, 2022, basic income per share for the Class A and Class B shares has been presented using the two class method and reflects the allocation of undistributed income described above.

Diluted net income per share is computed by dividing allocated net income by the weighted-average number of common shares outstanding, adjusted for the effect of dilutive stock options, restricted stock units (“stock units” or “units”) and non-vested restricted stock.

3 unchanged sentences

In periods where the Company reports a net loss, the effect of anti-dilutive stock options and units is excluded and diluted loss per share is equal to basic loss per share for both classes of stock.

For the three month periods ended December 30, 2022 and December 31, 2021, diluted net income per share reflects the effect of dilutive stock units and assumes the conversion of Class B common stock into Class A common stock.

Shares of non-vested stock that could potentially dilute earnings per share in the future which were not included in the fully diluted computation because they would have been anti-dilutive totaled 60,390 and 37,916 for the three months ended December 30, 2022 and December 31, 2021, respectively.

Stock units that could potentially dilute earnings per share in the future and which were not included in the fully diluted computation because they would have been anti-dilutive were 53,699 and 26,232 for the three months ended December 30, 2022 and December 31, 2021, respectively.

For the three and six month periods ended March 31, 2023 and April 1, 2022, diluted net income per share reflects the effect of dilutive stock units and assumes the conversion of Class B common stock into Class A common stock.

Shares of non-vested stock that could potentially dilute earnings per share in the future which were not included in the fully diluted computation because they would have been anti-dilutive totaled 67,732 and 39,163 for the three months ended March 31, 2023 and April 1, 2022, respectively, and 64,061 and 38,540 for the six months ended March 31, 2023 and April 1, 2022, respectively.

Stock units that could potentially dilute earnings per share in the future and which were not included in the fully diluted computation because they would have been anti-dilutive were 55,238 and 37,904 for the three months ended March 31, 2023 and April 1, 2022, respectively, and 58,605 and 33,966 for the six months ended March 31, 2023 and April 1, 2022, respectively.

Dividends per share

Dividends per share for the three month periods ended December 30, 2022 and December 31, 2021 were as follows:

Three Months Ended

December 30, 2022 December 31, 2021

Dividends per share for the three and six month periods ended March 31, 2023 and April 1, 2022 were as follows:

Three Months Ended Six months ended

March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Dividends declared per common share:

4 unchanged sentences

Current plans also allow for issuance of shares of restricted stock, restricted stock units or stock appreciation rights in lieu of stock options.

Under the Company’s 2012 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 395,018 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at December 30, 2022.

Share awards previously made under the Company's 2010 Long-Term Stock Incentive Plan, which no longer allows for additional share grants, also remain outstanding.

Non-vested Stock

Under the Company’s 2023 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 451,211 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at March 31, 2023.

Share awards previously made under the Company's 2012 Non-Employee Director Stock Ownership Plan and its 2010 Long-Term Stock Incentive Plan, which no longer allow for additional share grants, also remain outstanding.

JOHNSON OUTDOORS INC.

Non-vested Stock

All shares of non-vested restricted stock awarded by the Company have been granted in the form of shares of Class A common stock at their fair market value on the date of grant and vest within one year from the date of grant for stock granted to directors and four years from the date of grant for stock granted to officers and employees.

The fair value at date of grant is based on the number of shares granted and the average of the Company’s high and low Class A common stock price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock price on the last preceding date on which the Company’s Class A shares traded.

A summary of non-vested stock activity for the three months ended December 30, 2022 related to the Company’s stock ownership plans is as follows:

A summary of non-vested stock activity for the six months ended March 31, 2023 related to the Company’s stock ownership plans is as follows:

Shares Weighted Average

2 unchanged sentences

Restricted stock vested ( 14,790 ) 76.07

Non-vested stock at December 30, 2022 66,929 69.52

Non-vested stock at March 31, 2023 70,605 67.32

Non-vested stock grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of shares by tendering a portion of the vested shares back to the Company.

Shares tendered back to the Company were 2,289 and 1,778 during the three month periods ended December 30, 2022 and December 31, 2021, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $ 456 and $ 295 for the three month periods ended December 30, 2022 and December 31, 2021, respectively.

Unrecognized compensation cost related to non-vested stock as of December 30, 2022 was $ 2,938 , which amount will be amortized to expense through December 2026 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the three month periods ended December 30, 2022 and December 31, 2021 was $ 429 and $ 573 , respectively.

Shares tendered back to the Company were 2,289 and 1,778 during the six month periods ended March 31, 2023 and April 1, 2022, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $ 489 and $ 266 for the three month periods ended March 31, 2023 and April 1, 2022, respectively, and $ 945 and $ 561 for the six month periods ended March 31, 2023 and April 1, 2022, respectively.

Unrecognized compensation cost related to non-vested stock as of March 31, 2023 was $ 3,249 , which amount will be amortized to expense through December 2026 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the six month periods ended March 31, 2023 and April 1, 2022 was $ 1,029 and $ 1,053 , respectively.

Restricted Stock Units

2 unchanged sentences

The fair value at the date of grant is based on the number of units granted and the average of the Company’s high and low Class A common stock trading price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock trading price on the last preceding date on which the Company’s Class A shares traded.

A summary of RSU activity for the three months ended December 30, 2022 follows:

A summary of RSU activity for the six months ended March 31, 2023 follows:

Number of RSUs Weighted Average

2 unchanged sentences

RSUs vested ( 26,742 ) 64.51

RSUs at December 30, 2022 75,736 76.42

Stock compensation expense, net of forfeitures, related to RSUs was $ 476 and $ 727 for the three month periods ended December 30, 2022 and December 31, 2021, respectively.

Unrecognized compensation cost related to non-vested RSUs as of December 30, 2022 was $ 3,175 , which amount will be amortized to expense through September 2025 or adjusted for changes in future estimated or actual forfeitures.

RSUs at March 31, 2023 75,736 76.42

Stock compensation expense, net of forfeitures, related to RSUs was $ 449 and $ 597 for the three month periods ended March 31, 2023 and April 1, 2022, respectively, and $ 925 and $ 1,325 for the six month periods ended March 31, 2023 and April 1, 2022, respectively.

Unrecognized compensation cost related to non-vested RSUs as of March 31, 2023

JOHNSON OUTDOORS INC.

was $ 2,202 , which amount will be amortized to expense through September 2025 or adjusted for changes in future estimated or actual forfeitures.

RSU grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of units and issuance of unrestricted shares of Class A common stock by tendering a portion of such unrestricted shares back to the Company.

Shares tendered back to the Company for this purpose were 5,055 and 2,799 during the three month periods ended December 30, 2022 and December 31, 2021, respectively.

The fair value of restricted stock units recognized as a tax deduction during the three month periods ended December 30, 2022 and December 31, 2021 was $ 2,247 and $ 2,759 , respectively.

Shares tendered back to the Company for this purpose were 5,324 and 2,799 during the six month periods ended March 31, 2023 and April 1, 2022, respectively.

The fair value of restricted stock units recognized as a tax deduction during the six month periods ended March 31, 2023 and April 1, 2022 was $ 2,555 and $ 2,849 , respectively.

Compensation expense related to units earned by employees (as opposed to grants to outside directors) is based upon the attainment of certain Company financial goals related to cumulative net sales and cumulative operating profit over a three-year performance period.

6 unchanged sentences

2009 Employees’ Stock Purchase Plan, which was most recently amended on March 2, 2017, and which provides for the issuance of shares of Class A common stock at a purchase price of not less than 85 % of the fair market value of such shares on the date of grant or on the date of purchase, whichever is lower.

During the three month period ended December 30, 2022, the Company issued 0 shares of Class A common stock and recognized $ 21 of expense in connection with the Employees' Stock Purchase Plan.

During the three month period ended December 31, 2021, the Company issued 0 shares of Class A common stock and recognized $ 104 of expense in connection with the Plan.

During the three month period ended March 31, 2023, the Company issued 0 shares of Class A common stock and recognized $ 33 of expense in connection with the Employees' Stock Purchase Plan.

During the six month period ended March 31, 2023, the Company issued 0 shares of Class A common stock and recognized $ 54 of expense in connection with the Plan.

During the three month period ended April 1, 2022, the Company issued 0 shares of Class A common stock and recognized $ 96 of expense in connection with the Plan.

During the six month period ended April 1, 2022, the Company issued 0 shares of Class A common stock and recognized $ 199 of expense in connection with the Plan.

The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases.

The Company determines if an arrangement is a lease at inception.

As of December 30, 2022, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 16 years.

As of March 31, 2023, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 16 years.

Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI).

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The incremental borrowing rate is derived from information available to the Company at the lease commencement date based on lease length and location.

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended December 30, 2022 and December 31, 2021 were as follows:

Three months ended

December 30, 2022 December 31, 2021

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three and six months ended March 31, 2023 and April 1, 2022 were as follows:

JOHNSON OUTDOORS INC.

Three months ended Six months ended

March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Operating lease costs $ 2,509 $ 2,111 $ 4,939 $ 4,218

2 unchanged sentences

Total lease cost $ 3,151 $ 2,699 $ 6,151 $ 5,265

JOHNSON OUTDOORS INC.

Included in the amounts in the table above were rent expense to related parties of $ 314 and $ 291 for the three months ended December 30, 2022 and December 31, 2021, respectively.

As of December 30, 2022, the Company did not have any finance leases or sublease agreements.

Included in the amounts in the table above was rent expense to related parties of $ 314 and $ 628 for the three and six months ended March 31, 2023, respectively, and $ 290 and $ 581 for the three and six months ended April 1, 2022, respectively.

As of March 31, 2023, the Company did not have any finance leases or sublease agreements.

Additionally, the Company does not have any leases in which it is the lessor.

While the Company extended or renewed various existing leases during the quarter, there were no significant new leases entered into during the quarter ended December 30, 2022.

As of December 30, 2022, the Company did not have any significant operating lease commitments that have not yet commenced.

While the Company extended or renewed various existing leases during the quarter, there were no significant new leases entered into during the quarter ended March 31, 2023.

As of March 31, 2023, the Company did not have any significant operating lease commitments that have not yet commenced.

Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:

Three months ended

December 30, 2022 December 31, 2021

Six months ended

March 31, 2023 April 1, 2022

Operating leases:

6 unchanged sentences

Cash paid for amounts included in the measurement of lease liabilities $ 4,360 $ 3,739

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at December 30, 2022 were as follows:

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at March 31, 2023 were as follows:

Year Related parties included

9 unchanged sentences

Total net lease liability $ 4,636 $ 55,561

6 INCOME TAXES

For the three months ended December 30, 2022 and December 31, 2021, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

JOHNSON OUTDOORS INC.

Three Months Ended

6 INCOME TAXES

For the three and six months ended March 31, 2023 and April 1, 2022, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

Three Months Ended Six Months Ended

(thousands, except tax rate data)

December 30, 2022 December 31, 2021

March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Profit before income taxes $ 19,948 $ 13,210 $ 28,114 $ 27,799

1 unchanged sentence

Effective income tax rate 25.5 % 25.1 % 26.2 % 25.3 %

The increase in the effective tax rate for the three months ended December 30, 2022 compared to the three months ended December 31, 2021 was primarily due to the unfavorable tax expense impact of stock-based compensation awards in the current year period, compared to a tax benefit for similar awards in the prior year period.

The increase in the effective tax rate for the three and six months ended March 31, 2023 compared to the three and six months ended April 1, 2022 was primarily due to the unfavorable tax expense impact of stock-based compensation awards in the current year period, compared to a tax benefit for similar awards in the prior year period.

The impact of the Company’s operations in jurisdictions where a valuation allowance is assessed is removed from the overall effective tax rate methodology and recorded directly based on year to date results for the year for which no tax expense or benefit can be recognized.

The significant tax jurisdictions that have a valuation allowance for the periods ended December 30, 2022 and December 31, 2021 were:

December 30, 2022 December 31, 2021

The significant tax jurisdictions that have a valuation allowance for the periods ended March 31, 2023 and April 1, 2022 were:

March 31, 2023 April 1, 2022

Indonesia Indonesia

8 unchanged sentences

2023 September 30,

2022 December 31,

2022 April 1,

Raw materials $ 121,836 $ 166,443 $ 163,390

2 unchanged sentences

$ 236,671 $ 248,649 $ 235,220

The changes in goodwill during the three months ended December 30, 2022 and December 31, 2021 were as follows:

December 30, 2022 December 31, 2021

JOHNSON OUTDOORS INC.

The changes in goodwill during the six months ended March 31, 2023 and April 1, 2022 were as follows:

March 31, 2023 April 1, 2022

Balance at beginning of period $ 11,160 $ 11,221

1 unchanged sentence

Balance at end of period $ 11,169 $ 11,235

JOHNSON OUTDOORS INC.

The Company evaluates the carrying value of goodwill for a reporting unit on an annual basis or more frequently when events and circumstances warrant such an evaluation.

2 unchanged sentences

The Company provides warranties on certain of its products as they are sold.

The following table summarizes the Company’s warranty activity for the three months ended December 30, 2022 and December 31, 2021.

December 30, 2022 December 31, 2021

The following table summarizes the Company’s warranty activity for the six months ended March 31, 2023 and April 1, 2022.

March 31, 2023 April 1, 2022

Balance at beginning of period $ 9,639 $ 14,073

7 unchanged sentences

11 INDEBTEDNESS

The Company had no debt outstanding at December 30, 2022, September 30, 2022, or December 31, 2021.

The Company had no debt outstanding at March 31, 2023, September 30, 2022, or April 1, 2022.

The Company and certain of its subsidiaries have entered into an unsecured credit facility with PNC Bank National Association and Associated Bank, N.A.

3 unchanged sentences

On July 15, 2021, the Company entered into a First Amendment to this credit facility that extended its expiration date from November 15, 2022, to July 15, 2026.

Other key provisions of the credit facility remained as outlined herein and the description herein is qualified in its entirety by the terms and conditions of the original Debt Agreement (a copy of which was filed as Exhibit 99.1 to the current report on Form 8-K dated and filed with the Securities and Exchange Commission on November 20, 2017) and the Amendment, (a copy of which was filed as Exhibit 10.1 to the current report on Form 8-K dated and filed with the Securities and Exchange Commission on July 16, 2021).

JOHNSON OUTDOORS INC.

of which was filed as Exhibit 10.1 to the current report on Form 8-K dated and filed with the Securities and Exchange Commission on July 16, 2021).

The interest rate on the Revolver is based on LIBOR plus an applicable margin, which margin resets each quarter.

The applicable margin ranges from 1.00 % to 1.75 % and is dependent on the Company’s leverage ratio for the trailing twelve month period.

The interest rates on the Revolver at both December 30, 2022 and December 31, 2021 were approximately 5.4 % and 1.1 %, respectively.

The interest rates on the Revolver at both March 31, 2023 and April 1, 2022 were approximately 5.9 % and 1.4 %, respectively.

The Credit Agreement restricts the Company's ability to incur additional debt, includes maximum leverage ratio and minimum interest coverage ratio covenants and is unsecured.

Other Borrowings

JOHNSON OUTDOORS INC.

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of December 30, 2022 or December 31, 2021.

The Company utilizes letters of credit primarily as security for the payment of future claims under its workers’ compensation insurance, which totaled approximately $ 173 and $ 181 as of December 30, 2022 and December 31, 2021, respectively.

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of March 31, 2023 or April 1, 2022.

12 DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

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dollar, the sales, expenses, profits, losses, assets and liabilities of the Company’s foreign operations, as reported in the Company’s consolidated financial statements, increase or decrease, accordingly.

Approximately 12 % of the Company’s revenues for the three month period ended December 30, 2022 were denominated in currencies other than the U.S.

Approximately 5 % were denominated in euros, approximately 5 % were denominated in Canadian dollars and approximately 1 % were denominated in Hong Kong dollars, with the remaining revenues denominated in various other foreign currencies.

Approximately 13 % of the Company’s revenues for the six month period ended March 31, 2023 were denominated in currencies other than the U.S.

Approximately 5 % were denominated in euros, approximately 6 % were denominated in Canadian dollars and approximately 1 % were denominated in Hong Kong dollars, with the remaining 1 % of revenues denominated in various other foreign currencies.

Changes in foreign currency exchange rates can cause the Company to experience unexpected financial losses or cash flow needs.

2 unchanged sentences

The Company may use such foreign currency forward contracts to mitigate the risk associated with changes in foreign currency exchange rates on financial instruments and known commitments, including commitments for inventory purchases, denominated in foreign currencies.

As of December 30, 2022 and December 31, 2021, the Company held no foreign currency forward contracts.

As of March 31, 2023 and April 1, 2022, the Company held no foreign currency forward contracts.

13 FAIR VALUE MEASUREMENTS

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These are typically obtained from readily-available pricing sources for comparable instruments.

JOHNSON OUTDOORS INC.

• Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability.

These inputs reflect the reporting entity’s own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances.

The carrying amounts of cash, cash equivalents, short term investments, accounts receivable, and accounts payable approximated their fair values at December 30, 2022, September 30, 2022 and December 31, 2021 due to the short term maturities of these instruments.

The carrying amounts of cash, cash equivalents, short term investments, accounts receivable, and accounts payable approximated their fair values at March 31, 2023, September 30, 2022 and April 1, 2022 due to the short term maturities of these instruments.

When indicators of impairment are present, the Company may be required to value certain long-lived assets such as property, plant, and equipment, and other intangibles at their fair value.

Valuation Techniques

JOHNSON OUTDOORS INC.

Rabbi Trust Assets

4 unchanged sentences

Changes in the liability are recorded in "Administrative management, finance and information systems" expense in the accompanying Condensed Consolidated Statements of Operations.

The following table summarizes the Company’s financial assets measured at fair value as of December 30, 2022:

The following table summarizes the Company’s financial assets measured at fair value as of March 31, 2023:

Level 1 Level 2 Level 3 Total

3 unchanged sentences

Rabbi trust assets $ 21,436 $ — $ — $ 21,436

The following table summarizes the Company’s financial assets measured at fair value as of December 31, 2021:

The following table summarizes the Company’s financial assets measured at fair value as of April 1, 2022:

Level 1 Level 2 Level 3 Total

Rabbi trust assets $ 27,758 $ — $ — $ 27,758

The effect of changes in the fair value of financial instruments on the accompanying Condensed Consolidated Statements of Operations for the three month periods ended December 30, 2022 and December 31, 2021 was:

Three Months Ended

Location of income recognized in Statement of Operations December 30, 2022 December 31, 2021

Rabbi trust assets Other income, net $ 1,383 $ 1,095

There were no assets or liabilities measured at fair value on a non-recurring basis in periods subsequent to their initial recognition for either of the three month periods ended December 30, 2022 or December 31, 2021.

The effect of changes in the fair value of financial instruments on the accompanying Condensed Consolidated Statements of Operations for the three and six month periods ended March 31, 2023 and April 1, 2022 was:

Three Months Ended Six months ended

Location of income recognized in Statement of Operations March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022

Rabbi trust assets Other (income) expense, net $ ( 1,224 ) $ 2,144 $ ( 2,608 ) $ 1,049

There were no assets or liabilities measured at fair value on a non-recurring basis in periods subsequent to their initial recognition for either of the six month periods ended March 31, 2023 or April 1, 2022.

JOHNSON OUTDOORS INC.

14 NEW ACCOUNTING PRONOUNCEMENTS

4 unchanged sentences

The Company does not expect this guidance to have a significant impact on its financial statements and disclosures.

JOHNSON OUTDOORS INC.

Revenue is recognized when obligations under the terms of a contract with our customer are satisfied;

14 unchanged sentences

The Company provides customers the right to return eligible products under certain circumstances.

At December 30, 2022, the right to returns asset was $ 834 and the accrued returns liability was $ 2,317 .

At December 31, 2021, the right to returns asset was $ 780 and the accrued returns liability was $ 2,092 .

At March 31, 2023, the right to returns asset was $ 897 and the accrued returns liability was $ 2,401 .

At April 1, 2022, the right to returns asset was $ 827 and the accrued returns liability was $ 2,283 .

The Company also offers assurance-type warranties relating to its products sold to end customers that continue to be accounted for under ASC 460 Guarantees.

8 unchanged sentences

The Company conducts its worldwide operations through separate business segments, each of which represents major product lines.

Operations are conducted in the United States and various foreign countries, primarily in Europe, Canada and the Pacific Basin.

During the three month period ended December 30, 2022, combined net sales to two customers of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $ 50,062 of the Company's consolidated revenues.

During the three month period ended December 31, 2021, combined net sales to one customer of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $ 27,305 of the Company's consolidated revenues.

Operations are conducted in the United States and various foreign countries, primarily in Europe,

JOHNSON OUTDOORS INC.

Canada and the Pacific Basin.

During the three and six month period ended March 31, 2023, combined net sales to three customers of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $ 76,679 and $ 140,089 , respectively, of the Company's consolidated revenues.

During the three and six month periods ended April 1, 2022, combined net sales to one customer of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $ 21,616 and $ 48,921 , respectively, of the Company's consolidated revenues.

Net sales and operating profit include both sales to customers, as reported in the Company’s accompanying Condensed Consolidated Statements of Operations, and interunit transfers, which are priced to recover cost plus an appropriate profit margin.

Total assets represent assets that are used in the Company’s operations in each business segment at the end of the periods presented.

JOHNSON OUTDOORS INC.

A summary of the Company’s operations by business segment is presented below:

Three Months Ended

December 30, 2022 December 31, 2021 September 30, 2022

Three Months Ended Six Months Ended

March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022 September 30, 2022

Unaffiliated customers $ 155,009 $ 129,134 $ 292,830 $ 237,315

24 unchanged sentences

$ 700,882 $ 668,789 $ 679,931

17 ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended December 30, 2022 were as follows:

JOHNSON OUTDOORS INC.

During the second fiscal quarter of 2023, the Company sold the Military and Commercial Tent product lines of its Camping business segment to a third party in an asset sale for a purchase price of $ 14,990 .

The net book value of the assets and liabilities sold was approximately $ 8,350 , resulting in a gain on sale of approximately $ 6,640 , which is recorded in Other (income) expense, net in the Company’s accompanying Condensed Consolidated Statements of Operations.

The purchase price and the net proceeds received by the Company related to this sale are subject to customary purchase price adjustment provisions and Company indemnity obligations set forth in the definitive purchase agreement.

The sale did not include the Eureka!

brand name or the Eureka!

consumer/recreational Camping business line.

17 ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the six months ended March 31, 2023 were as follows:

Adjustment Unamortized

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Balance at December 30, 2022 $ 3,728 $ ( 163 ) $ 3,565

The changes in AOCI by component, net of tax, for the three months ended December 31, 2021 were as follows:

Other comprehensive loss before reclassifications 507 — 507

Amounts reclassified from accumulated other comprehensive income — 11 11

Tax effects — ( 3 ) ( 3 )

Balance at March 31, 2023 $ 4,235 $ ( 155 ) $ 4,080

The changes in AOCI by component, net of tax, for the six months ended April 1, 2022 were as follows:

Adjustment Unamortized

4 unchanged sentences

Income (Loss)

Balance at October 1, 2021 $ 7,606 $ ( 220 ) $ 7,386

October 1, 2021 $ 7,606 $ ( 220 ) $ 7,386

Other comprehensive income before reclassifications ( 423 ) — ( 423 )

2 unchanged sentences

Balance at December 31, 2021 $ 7,183 $ ( 204 ) $ 6,979

The reclassifications out of AOCI for the three months ended December 30, 2022 and December 31, 2021 were as follows:

Three Months Ended

December 30, 2022 December 31, 2021 Statement of Operations

Other comprehensive income before reclassifications 168 — 168

Amounts reclassified from accumulated other comprehensive income — 22 22

Tax effects — ( 6 ) ( 6 )

Balance at April 1, 2022 $ 7,351 $ ( 188 ) $ 7,163

The reclassifications out of AOCI for the three and six months ended March 31, 2023 and April 1, 2022 were as follows:

JOHNSON OUTDOORS INC.

Three Months Ended Six Months Ended

March 31, 2023 April 1, 2022 March 31, 2023 April 1, 2022 Statement of Operations

Unamortized loss on defined benefit pension plans:

3 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-Q

Item 1. Financial Statements