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United States

Securities and Exchange Commission

Washington, D.C. 20549

 

Form 8-K

Current Report

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): March 7, 2024

 

CLARUS CORPORATION

(Exact name of registrant as specified in its charter)

 

Delaware

(State or other jurisdiction

of incorporation)

001-34767

(Commission File Number)

58-1972600

(IRS Employer

Identification Number)

 

2084 East 3900 South, Salt Lake City, Utah

(Address of principal executive offices)

84124

(Zip Code)

 

Registrant’s telephone number, including area code: (801) 278-5552

 

N/A

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

  

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

  ¨ Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ¨

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading Symbol   Name of each exchange on which
registered
Common Stock, par value $.0001 per share   CLAR   NASDAQ Global Select Market

 

 

 


  

Item 2.02 Results of Operations and Financial Condition

 

On March 7, 2024, Clarus Corporation (the “Company”) issued a press release announcing results for the fourth quarter and year ended December 31, 2023 (the “Press Release”). A copy of the Press Release is furnished as Exhibit 99.1 and incorporated herein by reference.

 

The Press Release contains the non-GAAP measures: (i) adjusted gross margin and adjusted gross profit, (ii) adjusted (loss) income from continuing operations and related earnings (loss) per diluted share, (iii) earnings before interest, taxes, other income or expense, depreciation and amortization (“EBITDA”), EBITDA margin, adjusted EBITDA, and adjusted EBITDA margin, and (iv) free cash (defined as net cash provided by operating activities less capital expenditures). The Company believes the presentation of these non-GAAP measures provides useful information for the understanding of its ongoing operations and enables investors to focus on period-over-period operating performance, and thereby enhances the user’s overall understanding of the Company’s current financial performance relative to past performance and provides, along with the nearest GAAP measures, a baseline for modeling future earnings expectation. The non-GAAP measures are reconciled to comparable GAAP financial measures within the press release. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. Additionally, the Company notes that there can be no assurance that the above referenced non-GAAP financial measures are comparable to similarly titled financial measures used by other publicly traded companies.

 

The information in Item 2.02 of this Current Report on Form 8-K and the Press Release attached hereto as Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

 

Item 9.01. Financial Statements and Exhibits

 

(d) Exhibits.

 

Exhibit Description
   
99.1  Press Release dated March 7, 2024 (furnished only).
104 Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 


 


SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Dated: March 7, 2024

 

  CLARUS CORPORATION
     
     
  By: /s/ Michael J. Yates
  Name: Michael J. Yates
  Title:  Chief Financial Officer  

 

 

 

 

EX-99.1 2 tm248231d1_ex99-1.htm EXHIBIT 99.1

Exhibit 99.1

 

 

 

Clarus Reports Fourth Quarter and Full Year 2023 Results

 

Adventure Segment Generates Highest Quarterly Revenue of the Year

 

Proceeds from Precision Sport Sale Used to Repay All Debt and Significantly Increased Cash Position

 

Positioning Company for Growth and Profitability in 2024 and Beyond as a Pure-Play Outdoor Business

 

SALT LAKE CITY, Mar. 7, 2024 (GLOBE NEWSWIRE) -- Clarus Corporation (NASDAQ: CLAR) (“Clarus” and/or the “Company”), a global company focused on the outdoor enthusiast markets, reported financial results for the fourth quarter and full year ended December 31, 2023.

 

Fourth Quarter 2023 Financial Summary vs. Same Year-Ago Quarter (adjusted to reflect the reclassification of the Precision Sport segment as discontinued operations)

 

· Sales of $76.5 million compared to $73.8 million.
· Gross margin was 28.9% compared to 37.2%.
· Loss from continuing operations of $7.2 million, or $(0.19) per diluted share, compared to loss from continuing operations of $83.3 million, or $(2.25) per diluted share. Loss from continuing operations in Q4 2022 included a non-cash impairment charge of $92.3 million in the Adventure segment.
· Adjusted loss from continuing operations of $2.8 million, or $(0.07) per diluted share, compared to adjusted income from continuing operations of $4.4 million, or $0.11 per diluted share.
· Adjusted EBITDA of $(3.5) million with an adjusted EBITDA margin of (4.5)% compared to $3.6 million with an adjusted EBITDA margin of 4.9%.
· Precision Sport segment reported as discontinued operations due to sale announcement in December 2023.
· The sale of Precision Sport closed on February 29, 2024.

 

2023 Financial Summary vs. 2022 (adjusted to reflect the reclassification of the Precision Sport segment as discontinued operations)

 

· Sales of $286.0 million compared to $315.3 million.
· Gross margin was 34.1% compared to 34.9%; adjusted gross margin was 34.1% compared to 35.0%.
· Loss from continuing operations of $15.8 million, or $(0.42) per diluted share, compared to loss from continuing operations of $92.8 million, or $(2.49) per diluted share. Loss from continuing operations in 2022 included the $92.3 million non-cash impairment expense in the Adventure segment.
· Adjusted loss from continuing operations of $1.5 million, or $(0.04) per diluted share, compared to adjusted income from continuing operations of $9.4 million, or $0.24 per diluted share.
· Adjusted EBITDA of $1.2 million with an adjusted EBITDA margin of 0.4% compared to $17.6 million with an adjusted EBITDA margin of 5.6%.

 

 


 

 

 

Management Commentary

 

“Despite very challenging macroeconomic headwinds throughout 2023 that adversely impacted consumer demand, we have taken important steps to realign our brands and inventory levels to position Clarus for long-term profitable growth as a pure-play, ESG- friendly outdoor business,” said Warren Kanders, Clarus’ Executive Chairman. “After completing the sale of our Precision Sport segment, we are debt-free with over $40 million of cash on the balance sheet. We have a streamlined company focused on two operating segments poised for growth, each with strong leaders with highly capable teams focused on increasing profitability and unlocking new opportunities.”

 

Mr. Kanders added, “The monetization of our Precision Sport segment for $175 million was a highly successful outcome for Clarus. Clarus invested approximately $132 million in the Precision Sports segment since 2017. During our ownership period, the segment returned over $94 million of cash to Clarus and with the recently completed sale, it has generated nearly $270 million of returns. The operating income from Precision Sport also helped use a substantial portion of our net operating losses. With the proceeds from this sale, we retired in full all of Clarus’ outstanding debt and emerged with a debt-free balance sheet and flexibility to pursue our long-term growth initiatives at the Outdoor and Adventure segments.”

 

Mr. Kanders concluded, “We are pleased with the progress we have made at our Adventure segment, which had its best quarter of the year with 43% sales growth. With respect to Outdoor, I am excited about our potential to build long-term value. We are still in the early innings of our business turnaround. We are actively simplifying the organizational structure, our product categories and channel strategy. We have taken a careful view of inventory levels to better align with expected market demand. In 2024 we expect total company net sales in the range of $270 million to $280 million and adjusted EBITDA of $16 million to $18 million.”

 

Sale of Precision Sport / Discontinued Operations

 

On December 29, 2023, the Company announced the sale of its Precision Sport segment for $175 million. As the disposition was completed on February 29, 2024, we expect to recognize a gain on the disposition during the three months ending March 31, 2024. The activities of the Precision Sport segment have been segregated and reported as discontinued operations for all periods presented.

 

Fourth Quarter 2024 Financial Results

 

Sales in the fourth quarter were $76.5 million compared to $73.8 million in the same year- ago quarter. This was driven by strength at the Adventure segment due to success with OEM customers. This was partly offset by softness in the European region at Outdoor.

  

 


 

 

 

Sales in the Adventure segment increased 43% to $26.4 million, or $26.6 million on a constant currency basis, compared to $18.5 million in the year-ago quarter, reflecting increasing sales in the Australian market and the benefit of the TRED Outdoors acquisition announced during the fourth quarter of 2023. Sales in the Outdoor segment were $50.1 million, or $50.0 million on a constant currency basis, compared to $55.3 million in the year ago quarter. The decline primarily reflects continuing challenging market conditions, particularly in Europe.

 

Gross margin in the fourth quarter was 28.9% compared to 37.2% in the year-ago quarter. The decrease in gross margin was primarily due to $4.2 million of inventory reserve increases at the Outdoor segment. Adjusted gross margin in the fourth quarter was 29.0% compared to 37.2% in the year-ago quarter related to the inventory step-up as a result of the TRED Outdoors acquisition.

 

Selling, general and administrative expenses in the fourth quarter were $30.7 million compared to $29.9 million in the same year-ago quarter. The increase was attributable to the Outdoor segment with higher legal and marketing expenses compared to the prior year.

 

The loss from continuing operations in the fourth quarter of 2023 was $7.2 million, or $(0.19) per diluted share, compared to loss from continuing operations of $83.3 million, or $(2.25) per diluted share in the year-ago quarter. Loss from continuing operations in the fourth quarter included $1.5 million of one-off charges relating to restructuring and transaction costs. The loss from continuing operations in the fourth quarter of 2022 included a non-cash impairment charge of $92.3 million at the Adventure segment.

 

Adjusted loss from continuing operations in the fourth quarter of 2023 was $2.8 million, or $(0.07) per diluted share, compared to adjusted income from continuing operations of $4.3 million, or $0.11 per diluted share in the year-ago quarter. Adjusted (loss) income from continuing operations excludes restructuring charges and transaction costs, as well as non-cash items such as amortization, stock-based compensation, inventory fair value of purchase accounting and impairment charges.

 

Adjusted EBITDA in the fourth quarter was $(3.5) million, or an adjusted EBITDA margin of (4.5)%, compared to $3.6 million, or an adjusted EBITDA margin of 4.9%, in the same year- ago quarter. The decline in adjusted EBITDA was primarily driven by continuing challenging market conditions at Outdoor, an increase in inventory reserves at Outdoor and higher legal and marketing expenses.

 

Net cash provided by operating activities for the three months ended December 31, 2023, was $14.5 million compared to $32.4 million in the prior year quarter. Capital expenditures in the fourth quarter of 2023 were $1.2 million compared to $2.0 million in the prior year quarter. Free cash flow for the fourth quarter of 2023 was $13.3 million compared to $30.3 million in the prior year quarter.

 

 

 


 

 

Liquidity at December 31, 2023 vs. December 31, 2022

 

· Cash and cash equivalents totaled $11.3 million compared to $12.0 million.
· Total debt of $119.8 million compared to $139.0 million.
· On February 29, 2024, approximately $135.0 million of long-term debt, interest and fees were repaid and the credit agreement was subsequently terminated.

 

Full Year 2023 Financial Results

 

Sales in 2023 decreased 9.3% to $286.0 million compared to $315.3 million in 2022. The decrease in sales was primarily driven by continued softness in Outdoor wholesale markets in both North America and Europe as well as lower demand at Rhino-Rack USA compared to the prior year.

 

From a segment perspective, Outdoor sales were down 8% to $204.1 million and Adventure sales were down 12% to $82.0 million, compared to 2022.

 

Gross margin in 2023 was 34.1% compared to 34.9% in 2022 primarily due to promotional pricing and increased inventory reserves at the Outdoor segment, as well as unfavorable foreign currency exchange movement. These decreases were partially offset by favorable variances, primarily related to easing freight costs, at both the Outdoor and Adventure segments. Adjusted gross margin in 2023 was 34.1% compared to 35.0% in 2022 due to the impact of the TRED Outdoors acquisition in 2023 and Maxtrax in 2022.

 

Selling, general and administrative expenses in 2023 were $116.4 million compared to $120.8 million in 2022. The decrease was primarily due to reduced stock compensation, as well as expense reduction initiatives to offset challenging market conditions, lower intangible amortization expense, and lower sales commissions due to decreased revenue.

 

Loss from continuing operations in 2023 was $15.8 million, or $(0.42) per diluted share, compared to net loss of $92.8 million, or $(2.49) per diluted share, in the prior year. Loss from continuing operations in 2022 included a $92.3 million non-cash impairment charge in the Adventure segment.

 

Adjusted loss from continuing operations in 2023 was $1.5 million, or $(0.04) per diluted share, compared to adjusted income from continuing operations of $9.4 million, or $0.24 per diluted share in the year-ago quarter. Adjusted (loss) income from continuing operations excludes restructuring charges and transaction costs, as well as non-cash items such as amortization, stock-based compensation, inventory fair value of purchase accounting, contingent consideration and impairment charges.

 

Adjusted EBITDA in 2023 was $1.2 million, or an adjusted EBITDA margin of 0.4%, compared to $17.6 million, or an adjusted EBITDA margin of 5.6%, in 2022.

 

Net cash provided by operating activities for the year ended December 31, 2023, was $31.9 million compared to $14.6 million in 2022. Capital expenditures in 2023 were $5.7 million compared to $8.2 million in the prior year. Free cash flow for the year ended December 31, 2023, was $26.2 million compared to $6.4 million in the same year ago period. This increase is primarily due to lower inventory.

 

 


 

  

2024 Outlook

 

The Company expects fiscal year 2024 sales to range between $270 million to $280 million and adjusted EBITDA of approximately $16 million to $18 million, or an adjusted EBITDA margin of 6.2% at the mid-point of revenue and adjusted EBITDA. In addition, capital expenditures are expected to range between $4 million to $5 million and free cash flow is expected to range between $18 million to $20 million for the full year 2024. Clarus has not provided net income guidance due to the inherent difficulty of forecasting certain types of expenses and gains, which affect net income but not Adjusted EBITDA and/or Adjusted EBITDA Margin. Therefore, we do not provide a reconciliation of Adjusted EBITDA and/or Adjusted EBITDA Margin guidance to net income guidance.

 

Net Operating Loss (NOL)

 

The Company has net operating loss carryforwards (“NOLs”) for U.S. federal income tax purposes of $7.7 million. The Company believes its U.S. Federal NOLs will substantially offset its future U.S. Federal income taxes until expiration. None of NOLs expire until December 31, 2027, which the Company expects to realize in their entirety in 2024.

 

Conference Call

 

The Company will hold a conference call today at 5:00 p.m. Eastern time to discuss its fourth quarter 2023 results.

 

Date: Thursday, March 7, 2024

Time: 5:00 p.m. Eastern time (3:00 p.m. Mountain time) Registration Link:

https://register.vevent.com/register/BIae896d0fcbfe492d8c7b09d523f715d9

 

To access the call by phone, please register via the live call registration link above and you will be provided with dial-in instructions and details. The conference call will be broadcast live and available for replay here and on the Company’s website at www.claruscorp.com.

 

 

 


 

 

2024 Investor Day

 

The Company will host an investor day on Monday, March 11, 2024, from 12:00 pm to 2:00 pm ET in New York City that will feature additional commentary on Clarus’ strategic initiatives and growth opportunities with presentations from management, including Warren Kanders, Executive Chairman; Mike Yates, Chief Financial Officer; Neil Fiske, President, Black Diamond Equipment; and Mathew Hayward, Managing Director of Clarus' Adventure segment; followed by Q&A sessions.

 

· Date: Monday, March 11, 2024
· Time: 12:00 pm to 2:00 pm ET

 

Institutional investors and analysts interested in attending the event should contact The IGB Group at Clarus@igbir.com. Virtual attendance registration and webcast details will be available on the Company’s website. For those unable to attend the Investor Day, a replay will be made available after the event.

 

About Clarus Corporation

 

Headquartered in Salt Lake City, Utah, Clarus Corporation is a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor enthusiast markets. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Rhino-Rack®, MAXTRAX®, TRED Outdoors® brand names through outdoor specialty and online retailers, our own websites, distributors, and original equipment manufacturers. Our portfolio of iconic brands is well-positioned for sustainable, long-term growth underpinned by powerful industry trends across the outdoor and adventure sport end markets. For additional information, please visit www.claruscorp.com or the brand websites at www.blackdiamondequipment.com, www.rhinorack.com, www.maxtrax.com.au, www.tredoutdoors.com, or www.pieps.com.

 

Use of Non-GAAP Measures

 

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). This press release contains the non-GAAP measures: (i) adjusted gross margin and adjusted gross profit, (ii) adjusted (loss) income from continuing operations and related earnings (loss) per diluted share, (iii) earnings before interest, taxes, other income or expense, depreciation and amortization (“EBITDA”), EBITDA margin, adjusted EBITDA, and adjusted EBITDA margin, and (iv) free cash flow (defined as net cash provided by operating activities less capital expenditures). The Company believes that the presentation of certain non-GAAP measures, i.e.: (i) adjusted gross margin and adjusted gross profit, (ii) adjusted (loss) income from continuing operations and related earnings (loss) per diluted share , (iii) EBITDA, EBITDA margin, adjusted EBITDA and adjusted EBITDA margin, and (iv) free cash flow, provide useful information for the understanding of its ongoing operations and enables investors to focus on period- over-period operating performance, and thereby enhances the user's overall understanding of the Company's current financial performance relative to past performance and provides, along with the nearest GAAP measures, a baseline for modeling future earnings expectations. Non-GAAP measures are reconciled to comparable GAAP financial measures within this press release. The Company cautions that non-GAAP measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. Additionally, the Company notes that there can be no assurance that the above referenced non-GAAP financial measures are comparable to similarly titled financial measures used by other publicly traded companies.

 

 


 

 

 

Forward-Looking Statements

 

Please note that in this press release we may use words such as “appears,” “anticipates,” “believes,” “plans,” “expects,” “intends,” “future,” and similar expressions which constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting the Company and therefore involve a number of risks and uncertainties. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements. Potential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this release, include, but are not limited to, those risks and uncertainties more fully described from time to time in the Company's public reports filed with the Securities and Exchange Commission, including under the section titled “Risk Factors” in the Company's Annual Report on Form 10-K, and/or Quarterly Reports on Form 10-Q, as well as in the Company’s Current Reports on Form 8-K. All forward-looking statements included in this press release are based upon information available to the Company as of the date of this press release and speak only as of the date hereof. We assume no obligation to update any forward- looking statements to reflect events or circumstances after the date of this press release.

 

Company Contact:

Michael J. Yates

Chief Financial Officer mike.yates@claruscorp.com

 

Investor Relations:

The IGB Group

Leon Berman / Matt Berkowitz

Tel 1-212-477-8438 / 1-212-227-7098

lberman@igbir.com / mberkowitz@igbir.com

 

 

 


 

  

CLARUS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except per share amounts)

 

    December 31, 2023     December 31, 2022  
Assets                
Current assets                
Cash   $ 11,324     $ 11,981  
Accounts receivable, net     53,971       48,134  
Inventories     91,409       107,602  
Prepaid and other current assets     4,865       6,300  
Income tax receivable     892       3,034  
Assets held for sale     137,284       61,568  
Total current assets     299,745       238,619  
                 
Property and equipment, net     16,587       17,304  
Other intangible assets, net     41,466       48,296  
Indefinite-lived intangible assets     58,527       58,401  
Goodwill     39,320       36,278  
Deferred income taxes     22,869       17,912  
Other long-term assets     16,824       17,440  
Non-current assets held for sale     -       83,895  
Total assets   $ 495,338     $ 518,145  
                 
Liabilities and Stockholders’ Equity                
Current liabilities                
Accounts payable   $ 20,015     $ 24,767  
Accrued liabilities     24,580       20,553  
Income tax payable     805       421  
Current portion of long-term debt     119,790       11,904  
Liabilities held for sale     5,744       6,950  
Total current liabilities     170,934       64,595  
                 
Long-term debt, net     -       127,082  
Deferred income taxes     18,124       18,506  
Other long-term liabilities     14,160       15,854  
Total liabilities     203,218       226,037  
                 
Stockholders’ Equity                
Preferred stock, $0.0001 par value per share; 5,000 shares authorized; none issued     -       -  
Common stock, $0.0001 par value per share; 100,000 shares authorized; 42,761 and 41,637 issued and 38,149 and 37,048 outstanding, respectively     4       4  
Additional paid in capital     691,198       679,339  
Accumulated deficit     (350,739 )     (336,843 )
Treasury stock, at cost     (32,929 )     (32,707 )
Accumulated other comprehensive loss     (15,414 )     (17,685 )
Total stockholders’ equity     292,120       292,108  
Total liabilities and stockholders’ equity   $ 495,338     $ 518,145  

  

 


 

 

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF LOSS

(Unaudited)

(In thousands, except per share amounts)

 

 

 

    Three Months Ended  
    December 31, 2023     December 31, 2022  
             
Sales                
Domestic sales   $ 31,840     $ 30,146  
International sales     44,663       43,693  
Total sales     76,503       73,839  
                 
Cost of goods sold     54,361       46,392  
Gross profit     22,142       27,447  
                 
Operating expenses                
Selling, general and administrative     30,665       29,869  
Restructuring charges     1,411       -  
Transaction costs     134       50  
Impairment of goodwill and indefinite-lived intangible assets     -       92,311  
                 
Total operating expenses     32,210       122,230  
                 
Operating loss     (10,068 )     (94,783 )
                 
Other income                
Interest income, net     35       5  
Other, net     1,104       733  
                 
Total other income, net     1,139       738  
                 
Loss before income tax     (8,929 )     (94,045 )
Income tax benefit     (1,700 )     (10,742 )
Loss from continuing operations     (7,229 )     (83,303 )
                 
Discontinued operations, net of tax     (1,160 )     1,699  
                 
Net loss   $ (8,389 )   $ (81,604 )
                 
Loss from continuing operations per share:                
Basic   $ (0.19 )   $ (2.25 )
Diluted     (0.19 )     (2.25 )
                 
Net loss per share:                
Basic   $ (0.22 )   $ (2.20 )
Diluted     (0.22 )     (2.20 )
                 
Weighted average shares outstanding:                
Basic     38,312       37,039  
Diluted     38,312       37,039  

  

 


 

 

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF LOSS

(Unaudited)

(In thousands, except per share amounts)

 

    Twelve Months Ended  
    December 31, 2023     December 31, 2022  
             
Sales                
Domestic sales   $ 112,385     $ 132,818  
International sales     173,635       182,433  
Total sales     286,020       315,251  
                 
Cost of goods sold     188,509       205,298  
Gross profit     97,511       109,953  
                 
Operating expenses                
Selling, general and administrative     116,367       120,814  
Restructuring charges     3,223       -  
Transaction costs     593       2,818  
Contingent consideration (benefit) expense     (1,565 )     493  
Impairment of goodwill and indefinite-lived intangible assets     -       92,311  
                 
Total operating expenses     118,618       216,436  
                 
Operating loss     (21,107 )     (106,483 )
                 
Other income (expense)                
Interest income, net     67       -  
Other, net     961       (1,035 )
                 
Total other income (expense), net     1,028       (1,035 )
                 
Loss before income tax     (20,079 )     (107,518 )
Income tax benefit     (4,291 )     (14,716 )
Loss from continuing operations     (15,788 )     (92,802 )
                 
Discontinued operations, net of tax     5,642       23,022  
                 
Net loss   $ (10,146 )   $ (69,780 )
                 
(Loss) income from continuing operations per share:                
Basic   $ (0.42 )   $ (2.49 )
Diluted     (0.42 )     (2.49 )
                 
Net loss per share:                
Basic   $ (0.27 )   $ (1.88 )
Diluted     (0.27 )     (1.88 )
                 
Weighted average shares outstanding:                
Basic     37,485       37,201  
Diluted     37,485       37,201  

 

 


 

 

CLARUS CORPORATION

RECONCILIATION FROM GROSS PROFIT TO ADJUSTED GROSS PROFIT

AND ADJUSTED GROSS MARGIN

 

THREE MONTHS ENDED 

 

    December 31, 2023         December 31, 2022  
                 
Gross profit as reported   $ 22,142     Gross profit as reported   $ 27,447  
Plus impact of inventory fair value adjustment     64     Plus impact of inventory fair value adjustment     -  
Adjusted gross profit   $ 22,206     Adjusted gross profit   $ 27,447  
                     
Gross margin as reported     28.9 %   Gross margin as reported     37.2 %
                     
Adjusted gross margin     29.0 %   Adjusted gross margin     37.2 %

 

TWELVE MONTHS ENDED

 

    December 31, 2023         December 31, 2022  
                 
Gross profit as reported   $ 97,511     Gross profit as reported   $ 109,953  
Plus impact of inventory fair value adjustment     64     Plus impact of inventory fair value adjustment     269  
Adjusted gross profit   $ 97,575     Adjusted gross profit   $ 110,222  
                     
Gross margin as reported     34.1 %   Gross margin as reported     34.9 %
                     
Adjusted gross margin     34.1 %   Adjusted gross margin     35.0 %

  

 


 

 

CLARUS CORPORATION

RECONCILIATION FROM LOSS FROM CONTINUING OPERATIONS TO ADJUSTED (LOSS) INCOME FROM CONTINUING OPERATIONS AND
RELATED EARNINGS PER DILUTED SHARE 

(In thousands, except per share amounts)

 

    Three Months Ended December 31, 2023  
   

Total

sales

   

Gross

profit

   

Operating

expenses

   

Income tax

(benefit)
expense

   

Tax

rate

   

(Loss) income
from continuing operations

   

Diluted

EPS (1)

 
                                           
As reported   $ 76,503     $ 22,142     $ 32,210     $ (1,700 )     (19.0 )%   $ (7,229 )   $ (0.19 )
                                                         
Amortization of intangibles     -       -       (2,680 )     536               2,144          
Stock-based compensation     -       -       (1,218 )     244               974          
Inventory fair value of purchase accounting     -       (64 )     -       13               51          
Restructuring charges     -       -       (1,411 )     282               1,129          
Transaction costs     -       -       (134 )     27               107          
                                                         
As adjusted   $ 76,503     $ 22,078     $ 26,767     $ (598 )     (17.5 )%   $ (2,824 )   $ (0.07 )

 

(1) Potentially dilutive securities are excluded from the computation of diluted earnings (loss) per share if their effect is anti-dilutive to the loss from continuing operations. Reported loss from continuing operations per share and adjusted loss from continuing operations per share are both calculated based on 38,312 basic and diluted weighted average shares of common stock.

 

    Three Months Ended December 31, 2022  
    Total
sales
    Gross
profit
    Operating expenses     Income tax
(benefit)
expense
    Tax
rate
    (Loss) income
from continuing operations
    Diluted
EPS (1)
 
                                           
As reported   $ 73,839     $ 27,447     $ 122,230     $ (10,742 )     (11.4 )%   $ (83,303 )   $ (2.25 )
                                                         
Amortization of intangibles     -       -       (2,894 )     289               2,605          
Stock-based compensation     -       -       (2,170 )     217               1,953          
Impairment of goodwill and indefinite-lived intangible assets     -       -       (92,311 )     9,231               83,080          
Transaction costs     -       -       (50 )     5               45          
                                                         
As adjusted   $ 73,839     $ 27,447     $ 24,805     $ (1,000 )     (29.6 )%   $ 4,380     $ 0.11  

 

(1) Potentially dilutive securities are excluded from the computation of diluted earnings (loss) per share if their effect is anti-dilutive to the loss from continuing operations. Reported loss from continuing operations per share is calculated based on 37,039 basic and diluted weighted average shares of common stock. Adjusted income from continuing operations per share is calculated based on 38,307 diluted shares of common stock.

  

 


 

  

CLARUS CORPORATION

RECONCILIATION FROM LOSS FROM CONTINUING OPERATIONS TO ADJUSTED (LOSS) INCOME FROM CONTINUING OPERATIONS AND
RELATED EARNINGS PER DILUTED SHARE 

(In thousands, except per share amounts)

 

    Twelve Months Ended December 31, 2023  
    Total
sales
    Gross
profit
    Operating
 expenses
    Income tax
 (benefit)
 expense
    Tax
rate
    (Loss) income
from continuing
 operations
    Diluted
EPS (1)
 
                                           
As reported   $ 286,020     $ 97,511     $ 118,618     $ (4,291 )     (21.4 )%   $ (15,788 )   $ (0.42 )
                                                         
Amortization of intangibles     -       -       (10,715 )     2,293               8,422          
Stock-based compensation     -       -       (5,141 )     1,100               4,041          
Inventory fair value of purchase accounting     -       (64 )     -       14               50          
Restructuring charges     -       -       (3,223 )     690               2,533          
Transaction costs     -       -       (593 )     127               466          
Contingent consideration (benefit) expense     -       -       1,565       (335 )             (1,230 )        
                                                         
As adjusted   $ 286,020     $ 97,447     $ 100,511     $ (402 )     (21.1 )%   $ (1,506 )   $ (0.04 )

 

(1) Potentially dilutive securities are excluded from the computation of diluted earnings (loss) per share if their effect is anti-dilutive to the loss from continuing operations. Reported loss from continuing operations per share and adjusted loss from continuing operations per share are both calculated based on 37,485 basic and diluted weighted average shares of common stock.

 

    Twelve Months Ended December 31, 2022  
    Total
sales
    Gross
profit
    Operating
expenses
    Income tax
(benefit)
expense
    Tax
rate
    (Loss) income
from continuing operations
    Diluted
EPS (1)
 
                                           
As reported   $ 315,251     $ 109,953     $ 216,436     $ (14,716 )     (13.7 )%   $ (92,802 )   $ (2.49 )
                                                         
Amortization of intangibles     -       -       (12,557 )     1,720               10,837          
Stock-based compensation     -       -       (11,198 )     1,534               9,664          
Inventory fair value of purchase accounting     -       (269 )     -       37               232          
Impairment of goodwill and indefinite-lived intangible assets     -       -       (92,311 )     13,650               78,661          
Transaction costs     -       -       (2,818 )     386               2,432          
Contingent consideration (benefit) expense     -       -       (493 )     68               425          
                                                         
As adjusted   $ 315,251     $ 109,684     $ 97,059     $ 2,679       22.1 %   $ 9,449     $ 0.24  

 

(1) Potentially dilutive securities are excluded from the computation of diluted earnings (loss) per share if their effect is anti-dilutive to the loss from continuing operations. Reported loss from continuing operations per share is calculated based on 37,201 basic and diluted weighted average shares of common stock. Adjusted income from continuing operations per share is calculated based on 39,347 diluted shares of common stock.

  

 


 

 

 

CLARUS CORPORATION

RECONCILIATION FROM LOSS FROM CONTINUING OPERATIONS TO EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION, AND AMORTIZATION (EBITDA), EBITDA MARGIN, ADJUSTED EBITDA, AND ADJUSTED EBITDA MARGIN

(In thousands)

 

    Three Months Ended  
    December 31, 2023     December 31, 2022  
             
Loss from continuing operations   $ (7,229 )   $ (83,303 )
                 
Income tax benefit     (1,700 )     (10,742 )
Other, net     (1,104 )     (733 )
Interest expense, net     (35 )     (5 )
                 
Operating loss     (10,068 )     (94,783 )
                 
Depreciation     1,086       999  
Amortization of intangibles     2,680       2,894  
                 
EBITDA     (6,302 )     (90,890 )
                 
Restructuring charges     1,411       -  
Transaction costs     134       50  
Inventory fair value of purchase accounting     64       -  
Impairment of goodwill and indefinite-lived intangible assets     -       92,311  
Stock-based compensation     1,218       2,170  
                 
Adjusted EBITDA   $ (3,475 )   $ 3,641  
                 
Sales   $ 76,503     $ 73,839  
                 
EBITDA margin     -8.2 %     -123.1 %
Adjusted EBITDA margin     -4.5 %     4.9 %

 

 


 

 

CLARUS CORPORATION

RECONCILIATION FROM LOSS FROM CONTINUING OPERATIONS TO EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION, AND AMORTIZATION (EBITDA), EBITDA MARGIN, ADJUSTED EBITDA, AND ADJUSTED EBITDA MARGIN 

(In thousands)

 

    Twelve Months Ended  
    December 31, 2023     December 31, 2022  
             
Loss from continuing operations   $ (15,788 )   $ (92,802 )
                 
Income tax benefit     (4,291 )     (14,716 )
Other, net     (961 )     1,035  
Interest expense, net     (67 )     -  
                 
Operating loss     (21,107 )     (106,483 )
                 
Depreciation     4,150       4,388  
Amortization of intangibles     10,715       12,557  
                 
EBITDA     (6,242 )     (89,538 )
                 
Restructuring charges     3,223       -  
Transaction costs     593       2,818  
Contingent consideration (benefit) expense     (1,565 )     493  
Inventory fair value of purchase accounting     64       269  
Impairment of goodwill and indefinite-lived intangible assets     -       92,311  
Stock-based compensation     5,141       11,198  
                 
Adjusted EBITDA   $ 1,214     $ 17,551  
                 
Sales   $ 286,020     $ 315,251  
                 
EBITDA margin     -2.2 %     -28.4 %
Adjusted EBITDA margin     0.4 %     5.6 %