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Item 1. Financial Statements

2024-05-03 compared with 2024-02-02 · 173 added, 133 removed, 448 unchanged (41% of the section changed)

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended

(thousands, except per share data) December 29, 2023 December 30, 2022

Three Months Ended Six Months Ended

(thousands, except per share data) March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

Net sales $ 175,856 $ 202,115 $ 314,500 $ 380,452

6 unchanged sentences

Total operating expenses 61,684 63,945 114,492 121,252

Operating profit 46 5,472

Operating (loss) profit ( 253 ) 11,390 ( 207 ) 16,862

Interest income ( 857 ) ( 735 ) ( 2,055 ) ( 1,562 )

18 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended

(thousands) December 29, 2023 December 30, 2022

Three Months Ended Six Months Ended

(thousands) March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

Net income $ 2,156 $ 14,861 $ 6,111 $ 20,740

Other comprehensive income:

Other comprehensive income (loss):

Foreign currency translation 2,379 507 680 3,444

Unrealized gain on available-for-sale securities, net of tax 102 —

Unrealized (loss) gain on available-for-sale securities, net of tax ( 18 ) — 84 —

Change in pension plans, net of tax 8 8 15 16

4 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

(thousands, except share data) December 29, 2023 September 29, 2023 December 30, 2022

(thousands, except share data) March 29, 2024 September 29, 2023 March 31, 2023

Current assets:

48 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

Three Months Ended December 29, 2023

Six Months Ended March 29, 2024

(thousands except for shares) Shares Common Stock Capital in

14 unchanged sentences

BALANCE AT December 29, 2023 10,284,000 $ 516 $ 88,830 $ 410,182 $ 6,491 $ ( 2,149 )

Three Months Ended December 30, 2022

Net income — — — 2,156 — —

Dividends declared — — — ( 3,368 ) — —

Award of non-vested shares 22,692 1 ( 1 ) — —

Stock-based compensation — — ( 180 ) — — —

Currency translation adjustment — — — — ( 2,379 ) —

Unrealized gain (loss) on available-for-sale securities, net of tax — — — — ( 18 ) —

Change in pension plans, net of tax of $ 2

Non-vested stock forfeitures ( 5,350 ) — 341 — — ( 341 )

BALANCE AT MARCH 29, 2024 10,301,342 $ 517 $ 88,990 $ 408,970 $ 4,102 $ ( 2,490 )

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 )

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 )

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

1 unchanged sentence

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Cash paid for taxes Three Months Ended

(thousands) December 29, 2023 December 30, 2022

CASH PROVIDED BY (USED FOR) OPERATING ACTIVITIES

Six Months Ended

(thousands) March 29, 2024 March 31, 2023

CASH (USED FOR) PROVIDED BY OPERATING ACTIVITIES

Net income $ 6,111 $ 20,740

4 unchanged sentences

Stock based compensation 418 1,924

(Gain) loss on disposal of productive assets ( 1,917 ) 71

Gain on disposal of productive assets ( 1,963 ) ( 6,568 )

Deferred income taxes ( 317 ) ( 4 )

4 unchanged sentences

Other current assets 892 2,616

Other non-current assets — ( 10 )

Other long-term liabilities 2,985 ( 117 )

5 unchanged sentences

Capital expenditures ( 10,203 ) ( 13,998 )

4,685 ( 6,649 )

CASH USED FOR FINANCING ACTIVITIES

9 unchanged sentences

Cash paid for taxes $ 1,721 $ 8,493

Non-cash dividends 11 21

Cash paid for interest 59 57

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 29, 2023 and December 30, 2022, 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 29, 2024 and March 31, 2023, 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 29, 2023 which was filed with the Securities and Exchange Commission on December 8, 2023.

1 unchanged sentence

These reclassifications had no effect on net earnings.

Due to seasonal variations and other factors, some of which are described herein, the results of operations for the three months ended December 29, 2023 are not necessarily indicative of the results to be expected for the Company’s full 2024 fiscal year.

The current economic and business environment, including the level of demand in the consumer markets for outdoor recreation products, seasonality effects, and end consumer purchasing actions, all stemming therefrom, is beyond our control and remains highly uncertain and cannot be predicted at this time.

Due to seasonal variations and other factors, some of which are described herein, the results of operations for the three and six months ended March 29, 2024 are not necessarily indicative of the results to be expected for the Company’s full 2024 fiscal year.

The current economic and business environment, including the level of demand in the consumer markets for outdoor recreation products, seasonality effects, enhancements or changes in competitor product offerings, and end consumer purchasing actions, all stemming therefrom, is beyond our control and remains highly uncertain and cannot be predicted at this time.

All monetary amounts, other than share and per share amounts, are stated in thousands.

2 ACCOUNTS RECEIVABLE

Accounts receivable are stated net of allowances for doubtful accounts of $ 1,108 , $ 907 and $ 1,151 as of December 29, 2023, September 29, 2023 and December 30, 2022, respectively.

Accounts receivable are stated net of allowances for doubtful accounts of $ 749 , $ 907 and $ 1,121 as of March 29, 2024, September 29, 2023 and March 31, 2023, respectively.

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

13 unchanged sentences

JOHNSON OUTDOORS INC.

For the three month periods ended December 29, 2023 and December 30, 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.

For the three and six month periods ended March 29, 2024, basic net income per share for Class A and Class B shares was the same because there were no cumulative undistributed earnings and basic income per share for Class A and Class B shares has been presented using the two class method described above.

For the three and six month periods ended March 31, 2023, 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 as 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.

2 unchanged sentences

Therefore, diluted net income per share is the same for both Class A and Class B common shares.

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 29, 2023 and December 30, 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 63,061 and 60,390 for the three months ended December 29, 2023 and December 30, 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 65,228 and 53,699 for the three months ended December 29, 2023 and December 30, 2022, respectively.

In periods where the Company reports a net loss or no undistributed income because distributions through dividends exceed net income, 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 and six month periods ended March 29, 2024, the effect of non-vested restricted stock units is excluded from the diluted income per share calculation as their inclusion would have been anti-dilutive.

For the three and six month periods ended March 31, 2023, 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 70,182 and 67,732 for the three months ended March 29, 2024 and March 31, 2023, respectively, and 66,622 and 64,061 for the six months ended March 29, 2024 and March 31, 2023, 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 88,782 and 55,238 for the three months ended March 29, 2024 and March 31, 2023, respectively, and 88,782 and 58,605 for the six months ended March 29, 2024 and March 31, 2023, respectively.

Dividends per share

Dividends per share for the three month periods ended December 29, 2023 and December 30, 2022 were as follows:

Three Months Ended

December 29, 2023 December 30, 2022

Dividends per share for the three and six month periods ended March 29, 2024 and March 31, 2023 were as follows:

Three Months Ended Six months ended

March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

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 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 413,176 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at December 29, 2023.

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 402,706 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at March 29, 2024.

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.

Non-vested Stock

JOHNSON OUTDOORS INC.

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.

JOHNSON OUTDOORS INC.

A summary of non-vested stock activity for the three months ended December 29, 2023 related to the Company’s stock ownership plans is as follows:

A summary of non-vested stock activity for the six months ended March 29, 2024 related to the Company’s stock ownership plans is as follows:

Shares Weighted Average

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Restricted stock vested ( 18,594 ) 63.35

Non-vested stock at December 29, 2023 70,600 63.83

Forfeitures ( 5,350 ) 63.89

Non-vested stock at March 29, 2024 73,406 59.18

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 2,330 and 2,289 during the three month periods ended December 29, 2023 and December 30, 2022, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $ 428 and $ 456 for the three month periods ended December 29, 2023 and December 30, 2022, respectively.

Unrecognized compensation cost related to non-vested stock as of December 29, 2023 was $ 2,385 , which amount will be amortized to expense through December 2027 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the three month periods ended December 29, 2023 and December 30, 2022 was $ 409 and $ 429 , respectively.

Shares tendered back to the Company were 2,330 and 2,289 during the six month periods ended March 29, 2024 and March 31, 2023, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $ 322 and $ 489 for the three month periods ended March 29, 2024 and March 31, 2023, respectively, and $ 750 and $ 945 for the six month periods ended March 29, 2024 and March 31, 2023, respectively.

Unrecognized compensation cost related to non-vested stock as of March 29, 2024 was $ 2,605 , which amount will be amortized to expense through December 2027 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the six month periods ended March 29, 2024 and March 31, 2023 was $ 919 and $ 1,029 , 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 29, 2023 follows:

A summary of RSU activity for the six months ended March 29, 2024 follows:

Number of RSUs Weighted Average

2 unchanged sentences

RSUs vested ( 17,516 ) 88.49

RSUs at December 29, 2023 88,782 64.48

Stock compensation expense, net of forfeitures, related to RSUs was $ 139 and $ 476 for the three month periods ended December 29, 2023 and December 30, 2022, respectively.

Unrecognized compensation cost related to non-vested RSUs as of December 29, 2023 was $ 2,054 , which amount will be amortized to expense through September 2026 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 2,331 and 5,055 during the three month periods ended December 29, 2023 and December 30, 2022, respectively.

The fair value of restricted stock units recognized as a tax deduction during the three month periods ended December 29, 2023 and December 30, 2022 was $ 1,015 and $ 2,247 , respectively.

RSU's forfeited ( 3,452 ) 65.19

RSUs at March 29, 2024 85,330 64.46

For the three and six months ended March 29, 2024, the Company recognized income of $ 579 and $ 440 , respectively, related to RSUs as a result of reversing compensation expense previously recognized during the quarter, due to an

JOHNSON OUTDOORS INC.

expectation that performance conditions won't be met for certain awards.

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

Unrecognized compensation cost related to non-vested RSUs as of March 29, 2024 was $ 1,830 , which amount will be amortized to expense through September 2026 or adjusted for changes in future estimated or actual forfeitures.

Shares tendered back to the Company for this purpose were 2,331 and 5,324 during the six month periods ended March 29, 2024 and March 31, 2023, respectively.

The fair value of restricted stock units recognized as a tax deduction during the six month periods ended March 29, 2024 and March 31, 2023 was $ 1,015 and $ 2,555 , 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 29, 2023, the Company issued 0 shares of Class A common stock and recognized $ 31 of expense in connection with the Employees' Stock Purchase Plan.

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 Plan.

During the three month period ended March 29, 2024, the Company issued 0 shares of Class A common stock and recognized $ 77 of expense in connection with the Employees' Stock Purchase Plan.

During the six month period ended March 29, 2024, the Company issued 0 shares of Class A common stock and recognized $ 108 of expense in connection with the Employees' Stock Purchase 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 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.

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 29, 2023, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 16 years.

As of March 29, 2024, 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 29, 2023 and December 30, 2022 were as follows:

Three months ended

December 29, 2023 December 30, 2022

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three and six months ended March 29, 2024 and March 31, 2023 were as follows:

JOHNSON OUTDOORS INC.

Three months ended Six months ended

March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

Operating lease costs $ 2,476 $ 2,509 $ 4,941 $ 4,939

2 unchanged sentences

Total lease cost $ 3,118 $ 3,151 $ 6,253 $ 6,151

Included in the amounts in the table above was rent expense to related parties of $ 314 and $ 314 for the three months ended December 29, 2023 and December 30, 2022, respectively.

As of December 29, 2023, 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 $ 313 and $ 627 for the three and six months ended March 29, 2024, respectively, and $ 314 and $ 628 for the three and six months ended March 31, 2023, respectively.

As of March 29, 2024, 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 29, 2023.

As of December 29, 2023, the Company did not have any significant operating lease commitments that have not

JOHNSON OUTDOORS INC.

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 29, 2024.

During the second quarter of fiscal 2024, the Company entered into an agreement to obtain additional space at an existing lease site that will begin in fiscal 2025 and will result in additional estimated lease payments of approximately $ 2,000 over the remaining lease term, which are not included in the future minimum rental commitments below.

As of March 29, 2024, the Company did not have any other 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 29, 2023 December 30, 2022

Six months ended

March 29, 2024 March 31, 2023

Operating leases:

7 unchanged sentences

ROU assets obtained in exchange for lease liabilities $ 3,276 $ 2,540

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at December 29, 2023 were as follows:

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at March 29, 2024 were as follows:

JOHNSON OUTDOORS INC.

Year Related parties included

9 unchanged sentences

6 INCOME TAXES

For the three months ended December 29, 2023 and December 30, 2022, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

Three Months Ended

For the three and six months ended March 29, 2024 and March 31, 2023, 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 29, 2023 December 30, 2022

March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

Profit before income taxes $ 3,012 $ 19,948 $ 8,911 $ 28,114

1 unchanged sentence

Effective income tax rate 28.4 % 25.5 % 31.4 % 26.2 %

The increase in the effective tax rate for the three months ended December 29, 2023 compared to the three months ended December 30, 2022 was primarily related to a change in the geographic mix of profits or losses from a tax

JOHNSON OUTDOORS INC.

perspective for the current year period, as compared to the prior year period.

The increase in the effective tax rate for the three and six months ended March 29, 2024 compared to the three and six months ended March 31, 2023 was primarily related to a change in the geographic mix of profits or losses from a tax perspective for the current year period, as compared to the prior year period.

The Company's effective tax rate is impacted by valuation allowances in certain tax jurisdictions and, as a result, changes in the geographic source of Company profits or losses between periods can have varying impacts on the Company's effective tax rate during a particular 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 29, 2023 and December 30, 2022 were:

December 29, 2023 December 30, 2022

The significant tax jurisdictions that have a valuation allowance for the periods ended March 29, 2024 and March 31, 2023 were:

March 29, 2024 March 31, 2023

Indonesia Indonesia

4 unchanged sentences

In accordance with its accounting policy, the Company recognizes accrued interest and penalties related to unrecognized benefits as a component of income tax expense.

JOHNSON OUTDOORS INC.

7 INVENTORIES

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2024 September 29,

2023 December 30,

2023 March 31,

Raw materials $ 119,981 $ 114,467 $ 121,836

Work in process — — 229

Finished goods 129,220 147,007 114,835

$ 249,201 $ 261,474 $ 236,671

The Company’s inventory levels have been significantly impacted over recent periods in connection with swings in demand for the Company’s products coming out of the recent COVID-19 pandemic.

The Company’s inventory levels have been significantly impacted over recent periods in connection with swings in demand for the Company’s products and supply chain availability of certain materials and components coming out of the recent COVID-19 pandemic.

See below under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional discussion on the impact of recent fluctuations in the Company’s net sales, including changes in demand for the Company’s products, on the Company’s inventory balances.

The changes in goodwill during the three months ended December 29, 2023 and December 30, 2022 were as follows:

December 29, 2023 December 30, 2022

The changes in goodwill during the six months ended March 29, 2024 and March 31, 2023 were as follows:

March 29, 2024 March 31, 2023

Balance at beginning of period $ 11,172 $ 11,160

1 unchanged sentence

Balance at end of period $ 11,167 $ 11,169

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 29, 2023 and December 30, 2022.

December 29, 2023 December 30, 2022

The following table summarizes the Company’s warranty activity for the six months ended March 29, 2024 and March 31, 2023.

March 29, 2024 March 31, 2023

Balance at beginning of period $ 11,741 $ 9,639

6 unchanged sentences

Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome of any pending litigation will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

JOHNSON OUTDOORS INC.

11 INDEBTEDNESS

The Company had no debt outstanding at December 29, 2023, September 29, 2023, or December 30, 2022.

The Company had no debt outstanding at March 29, 2024, September 29, 2023, or March 31, 2023.

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

7 unchanged sentences

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 29, 2023 and December 30, 2022 were approximately 6.5 % and 5.4 %, respectively.

The interest rates on the Revolver at both March 29, 2024 and March 31, 2023 were approximately 6.5 % and 5.9 %, 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 29, 2023 or December 30, 2022.

The Company utilizes letters of credit primarily as security for the payment of future claims under its workers’ compensation insurance, which totaled approximately $ 67 and $ 173 as of December 29, 2023 and December 30, 2022, respectively.

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of March 29, 2024 or March 31, 2023.

12 DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

5 unchanged sentences

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 13 % of the Company’s revenues for the three month period ended December 29, 2023 were denominated in currencies other than the U.S.

Approximately 12 % of the Company’s revenues for the six month period ended March 29, 2024 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.

2 unchanged sentences

Foreign currency forward contracts enable the Company to lock in the foreign currency exchange rate to be paid or received for a fixed amount of currency at a specified date in the future.

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 29, 2023 and December 30, 2022, the Company held no foreign currency forward contracts.

The Company may use such foreign currency forward contracts to mitigate the risk associated with changes in foreign currency exchange

JOHNSON OUTDOORS INC.

rates on financial instruments and known commitments, including commitments for inventory purchases, denominated in foreign currencies.

As of March 29, 2024 and March 31, 2023, the Company held no foreign currency forward contracts.

13 FAIR VALUE MEASUREMENTS

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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, accounts receivable, and accounts payable approximated their fair values at December 29, 2023, September 29, 2023 and December 30, 2022 due to the short term maturities of these instruments.

The carrying amounts of accounts receivable and accounts payable approximated their fair values at March 29, 2024, September 29, 2023 and March 31, 2023 due to the short term maturities of these instruments.

See Note 14 for discussion of fair value of cash and cash equivalents.

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.

During the second quarter of fiscal 2024, the Company determined that indicators of potential impairment of long-lived assets were present in the Watercraft segment, and performed an analysis of future undiscounted cash flows, which exceeded carrying value of the asset group.

Therefore, it was determined there was no impairment.

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 29, 2023:

The following table summarizes the Company’s financial assets measured at fair value as of March 29, 2024:

Level 1 Level 2 Level 3 Total

3 unchanged sentences

Rabbi trust assets $ 24,562 $ — $ — $ 24,562

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

JOHNSON OUTDOORS INC.

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

Rabbi trust assets $ 24,101 $ — $ — $ 24,101

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 29, 2023 and December 30, 2022 was:

Three Months Ended

Location of income recognized in Statement of Operations December 29, 2023 December 30, 2022

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 29, 2024 and March 31, 2023 was:

Three Months Ended Six months ended

Location of income recognized in Statement of Operations March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023

Rabbi trust assets Other income, net $ 2,100 $ 1,224 $ 4,772 $ 2,608

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 29, 2023 or December 30, 2022.

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 29, 2024 or March 31, 2023.

14 CASH, CASH EQUIVALENTS, AND MARKETABLE SECURITIES

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During the third quarter of fiscal 2023, the Company invested in marketable securities.

The Company has classified all marketable securities as available-for-sale which requires the securities to be reported at estimated fair value, with unrealized gains and losses, net of tax, reported as a separate component of stockholders' equity.

At December 29, 2023, cost for marketable securities was determined using the specific identification method.

A summary of the amortized costs and fair values of the Company’s marketable securities at the end of the period

JOHNSON OUTDOORS INC.

presented is shown in the following table.

At March 29, 2024, cost for marketable securities was determined using the specific identification method.

A summary of the amortized costs and fair values of the Company’s marketable securities at the end of the period presented is shown in the following table.

All of the Company’s marketable securities are classified as Level 2, as defined by FASB ASC 820, with fair values determined using significant other observable inputs, which include quoted prices in markets that are not active, quoted prices of similar securities, recently executed transactions, broker quotations, and other inputs that are observable.

The following table summarizes the Company’s marketable securities measured at fair value as of December 29, 2023:

The following table summarizes the Company’s marketable securities measured at fair value as of March 29, 2024:

Amortized Cost Fair Value Gross unrealized gains Gross unrealized losses

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The following table summarizes the Company’s marketable securities measured at fair value as of September 29, 2023:

JOHNSON OUTDOORS INC.

Amortized Cost Fair Value Gross unrealized gains Gross unrealized losses

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Total $ 40,870 $ 40,707 $ — $ 163

Proceeds from the maturities of available for sale securities were $ 7,500 and $ 0 for the three month periods ended December 29, 2023 and December 30, 2022, respectively.

There were no sales or purchases of available-for-sale securities for the three month periods ended December 29, 2023 and December 30, 2022, respectively.

Proceeds from the maturities of available for sale securities were $ 15,000 and $ 0 for the six month periods ended March 29, 2024 and March 31, 2023, respectively.

There were no sales or purchases of available-for-sale securities for the six month periods ended March 29, 2024 and March 31, 2023, respectively.

No unrealized gains or losses were reclassified out of accumulated other comprehensive income during the same periods.

The contractual maturities of the marketable securities held at December 29, 2023 are as follows:

The future contractual maturities of the marketable securities held at March 29, 2024 are as follows:

$ 23,914 within one year, classified as Short-Term Investments on the Condensed Consolidated Balance Sheets, and $ 2,157 greater than one year, but less than five years, classified as Investments on the Condensed Consolidated Balance Sheets.

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Recently issued accounting pronouncements

In March 2024, the United States Securities and Exchange Commission (SEC) issued Final Rulemaking Release No.

The Enhancement and Standardization of Climate-Related Disclosures for Investors.

This release is intended to improve consistency, completeness and transparency related to climate risks and events.

The disclosure requirements related to this new rule will be phased in, and effective for the Company beginning in fiscal 2027 on a prospective basis.

The Company is currently evaluating the potential impact of this release on its financial statements and disclosures.

In December 2023, the Financial Account Standards Board (FASB), issued Accounting Standards Update (ASU) 2023-09, Income Taxes (Topic 740):

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The amendments in this ASU are effective for the Company in fiscal 2026 on a prospective basis, with early adoption permitted.

The Company is currently evaluating the potential impact of this guidance on its financial statements and disclosures.

The Company is currently evaluating the potential impact of this guidance on its disclosures.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

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Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative.

This ASU covers a variety of codification topics, and the effective date for each amendment will be the date on which the SEC‘s removal of that related disclosure from

JOHNSON OUTDOORS INC.

Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The Company is currently evaluating the potential impact of this guidance on its financial statements and disclosures.

This ASU covers a variety of codification topics, and the effective date for each amendment will be the date on which the SEC‘s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited.

The Company is currently evaluating the potential impact of this guidance on its disclosures.

Recently adopted accounting pronouncements

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ASU 2020-04 is intended to provide optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (LIBOR) or by another reference rate expected to be discontinued.

Subsequently in December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848)—Deferral of the Sunset Date of Topic 848, which delayed the effective date to December 31, 2024.

Subsequently in December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848)—Deferral of the Sunset Date of Topic 848, which delayed the effective date of Topic 848 to December 31, 2024.

The Company adopted Topic 848 in the fourth fiscal quarter of 2023.

The adoption of this pronouncement did not have a material impact on its financial statements and disclosures.

The adoption of this pronouncement did not have a material impact on its disclosures.

JOHNSON OUTDOORS INC.

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

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

At December 29, 2023, the right to returns asset was $ 1,108 and the accrued returns liability was $ 2,723 .

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

At March 29, 2024, the right to returns asset was $ 1,266 and the accrued returns liability was $ 3,362 .

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

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.

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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,

JOHNSON OUTDOORS INC.

Canada and the Pacific Basin.

During the three month period ended December 29, 2023, combined net sales to two customers of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $ 54,147 of the Company's consolidated revenues.

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 second quarter of fiscal 2023, the Company sold the Military and Commercial Tent product lines of its Camping segment to a third party in an asset sale.

The sale did not include the Eureka!

brand name or the Eureka!

consumer/recreational Camping business line.

Subsequently, during the fourth quarter of fiscal 2023, the Company developed and approved plans to fully exit the Eureka!

brand of the Camping segment, which includes liquidating all remaining consumer inventory of Eureka!

branded products and winding down operations.

The Company incurred expenses of approximately $ 4,800 in the fourth quarter of fiscal 2023 related to the wind down of the Eureka!

branded business.

Other costs incurred during fiscal 2024 will be expensed as incurred and are not expected to be material.

During the first quarter of fiscal 2024, the Fishing segment of the Company sold a building, which resulted in a gain of approximately $ 1,900 , which was recorded in Other income, net in the accompanying Condensed Consolidated Statements of Operations.

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

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.

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

Three Months Ended

December 29, 2023 December 30, 2022 September 29, 2023

Three Months Ended Six Months Ended

March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023 September 29, 2023

Unaffiliated customers $ 138,466 $ 155,009 $ 248,827 $ 292,830

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Other / Corporate ( 8,605 ) ( 9,815 ) ( 17,790 ) ( 20,266 )

$ ( 253 ) $ 11,390 $ ( 207 ) $ 16,862

Total assets (end of period):

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$ 691,678 $ 700,882 $ 681,606

18 ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended December 29, 2023 were as follows:

Other Segment Information

During the three and six month period ended March 29, 2024, two customers of the Company's Fishing, Camping and Watercraft Recreation segments each accounted for more than 10% of the Company's consolidated revenues, which amounted to combined net sales of approximately $ 54,746 and $ 108,893 , respectively.

During the three and six month periods 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 second quarter of fiscal 2023, the Company sold the Military and Commercial Tent product lines of its Camping segment to a third party in an asset sale.

The sale did not include the Eureka!

brand name or the Eureka!

consumer/recreational Camping business line.

Subsequently, during the fourth quarter of fiscal 2023, the Company developed and approved plans to fully exit the Eureka!

brand of the Camping segment, which includes liquidating all remaining consumer inventory of Eureka!

branded products and winding down operations.

The Company incurred expenses of approximately $ 4,800 in the fourth quarter of fiscal 2023 related to the wind down of the Eureka!

branded business.

Other costs incurred during fiscal 2024 will be expensed as incurred and are not expected to be material.

JOHNSON OUTDOORS INC.

18 ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the six months ended March 29, 2024 were as follows:

Adjustment Unrealized gain (loss) on available-for sale securities Unamortized

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Balance at September 29, 2023 $ 3,581 $ ( 121 ) $ ( 137 ) $ 3,323

Other comprehensive loss before reclassifications 3,059 138 — 3,197

Other comprehensive income before reclassifications 3,059 138 — 3,197

Amounts reclassified from accumulated other comprehensive income — — 10 10

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Balance at December 29, 2023 $ 6,640 $ ( 19 ) $ ( 130 ) $ 6,491

The changes in AOCI by component, net of tax, for the three months ended December 30, 2022 were as follows:

Other comprehensive loss before reclassifications ( 2,379 ) ( 24 ) — ( 2,403 )

Amounts reclassified from accumulated other comprehensive income — — 10 10

Tax effects — 6 ( 2 ) 4

Balance at March 29, 2024 $ 4,261 $ ( 37 ) $ ( 122 ) $ 4,102

The changes in AOCI by component, net of tax, for the six months ended March 31, 2023 were as follows:

Adjustment Unamortized

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Income (Loss)

September 30, 2022 $ 791 $ ( 171 ) $ 620

Balance at September 30, 2022 $ 791 $ ( 171 ) $ 620

Other comprehensive income before reclassifications 2,937 — 2,937

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

The reclassifications out of AOCI for the three months ended December 29, 2023 and December 30, 2022 were as follows:

Three Months Ended

December 29, 2023 December 30, 2022 Statement of Operations

Other comprehensive income 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 reclassifications out of AOCI for the three and six months ended March 29, 2024 and March 31, 2023 were as follows:

JOHNSON OUTDOORS INC.

Three Months Ended Six Months Ended

March 29, 2024 March 31, 2023 March 29, 2024 March 31, 2023 Statement of Operations

Unamortized loss on defined benefit pension plans:

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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.

What changed 10-Q

Item 1. Financial Statements