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Clarus Reports First Quarter 2020 Results and Highlights the Company’s Strength to Navigate COVID-19
SALT LAKE CITY, Utah – May 11, 2020 – Clarus Corporation (NASDAQ: CLAR) (“Clarus” and/or the “Company”), a company focused on the outdoor and consumer industries, reported financial results for the first quarter ended March 31, 2020, including the Company’s position of strength to navigate the COVID-19 pandemic.
First Quarter 2020 Financial Summary vs. Same Year-Ago Quarter
|·||Sales were $53.6 million compared to $61.2 million.|
|·||Gross margin was 34.6% compared to 36.0%.|
|·||Net income was $0.04 million, or $0.00 per diluted share, compared to $3.8 million, or $0.12 per diluted share.|
|·||Adjusted net income before non-cash items was $2.7 million, or $0.09 per diluted share, compared to $6.9 million, or $0.23 per diluted share.|
|·||Adjusted EBITDA was $3.6 million compared to $7.3 million.|
Given COVID-19, Clarus has prioritized its liquidity and strengthened its balance sheet. At the end of the first quarter of 2020, Clarus had $12.8 million in cash and access to $27.9 million in additional liquidity through its line of credit with J.P. Morgan Chase Bank, N.A. In addition, approximately $13.0 million in cash saving initiatives have been implemented or identified for the remainder of the year. Highlights of the various liquidity improvements and cash saving measures include:
|·||At March 31, 2020, Clarus had $32.1 million drawn on its revolving line of credit (compared to $22.7 million drawn at the end of 2019) with remaining access to $27.9 million. Cash and cash equivalents totaled $12.8 million compared to $1.7 million at the end of 2019.|
|·||Subsequent to the first quarter end, Clarus borrowed $20.0 million under the term loan portion of its credit agreement to increase overall liquidity. The proceeds borrowed were used to pay down amounts outstanding on its revolving line of credit.|
|·||Planned operating expenses will be reduced by an estimated $9.0 million for the remainder of 2020 as Clarus accelerates its shift towards a more digital presence, sharpens its focus on key product categories, drives improved operational efficiencies, and fosters a tighter connection with its distribution and supply partners.|
|·||Postponed approximately $2.0 million of capital expenditures scheduled for 2020 until business conditions stabilize, with the exception of planned e-commerce investments.|
|·||Temporarily replaced the Company’s quarterly cash dividend with a stock dividend.|
“We began the year with great momentum after record financial results in 2019,” said Clarus President John Walbrecht. “However, in the final weeks of the quarter, our Black Diamond business experienced a dramatic global slowdown as our retail partners shut their doors and cancelled open orders due to the COVID-19 pandemic. Leading up to that point, our revenue and earnings were trending in line with our expectations for the quarter. These declines were somewhat offset by improving demand in our Sierra business late in the quarter, which highlights our product diversity, but in no way made our results immune to the pandemic.
The following information was filed by Clarus Corp (CLAR) on Monday, May 11, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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