SPRINGFIELD, Mass. — Smith & Wesson Holding Corporation (NASDAQ:SWHC), parent company of Smith & Wesson Corp., announced financial results for its third fiscal quarter ended January 31, 2009.
Net product sales for the three months ended January 31, 2009 were $83.2 million, a $17.1 million, or 25.9%, increase over net product sales for the three months ended January 31, 2008.
Total firearms sales for the third quarter were $78.5 million, an increase of $16.9 million, or 27.5%, over the third quarter of last year.
Pistol sales increased 45.7% to $24.9 million. Sales of M&P pistols increased 77.1% for the third quarter. M&P tactical rifle sales increased by 111% to $8.8 million for the third quarter as demand for this product remained strong in both the consumer and law enforcement channels. Total revolver sales were $22.3 million, an increase of $7.0 million, or 45.4%, versus the comparable quarter one year ago.
Sales of non-firearm accessories, including handcuffs, totaled $4.7 million, a 4.0% increase over non-firearm accessory sales of $4.5 million for the third quarter last year. Hunting firearm sales of $6.7 million represented a decline of $5.8 million, or 46.4%, from the comparable quarter in the last fiscal year. Michael F. Golden, President and Chief Executive Officer, said, “Sales of M&P pistols continued to be strong throughout the third quarter. During the quarter, we received orders for our M&P pistols from a number of police agencies, including the Raleigh, North Carolina Police Department. To date, over 489 domestic law enforcement agencies have adopted or approved the M&P for duty use. The M&P pistol also continues to penetrate the international market. In the third quarter, we recorded orders for the M&P pistol from Puerto Rico and the M&P was added to the approved officer purchase list by the Lebanese government.”
Golden added, “Robust sales of our M&P15 tactical rifles also continued throughout the third quarter, benefitting from heightened demand at the consumer level. We expanded the M&P tactical rifle family with the introduction in January of the M&P15-22 semi-automatic sport rifle. The M&P15-22 has been designed along the same, popular lines as our entire M&P15 family of tactical rifles; yet, it is chambered in the much more economical .22 caliber ammunition. We believe this new product will appeal to consumers seeking an economical alternative in this very popular product category.”
Gross profit of $21.6 million for the third quarter was $5.0 million, or 29.9%, higher than gross profit for the comparable quarter last year. Gross margins increased to 25.8% from 25.0% for the comparable quarter last year.
Gross margins were negatively impacted by a $2.0 million charge for the recall of Walther pistols due to a possible problem recently detected with the hammer block system.
Operating expenses for the third quarter increased by approximately $699,000, or 4.3%, over the third quarter last year.