Escalade Inc ESCA reported a fourth-quarter FY23 sales decline of 9.2% year-on-year to $65.51 million, missing the analyst consensus estimate of $67.09 million.
The decline is primarily due to softer consumer demand across the majority of the company’s product categories, partially offset by improved demand in its basketball and indoor games product categories.
Gross margin for the quarter improved 192 basis points to 24.3%. Operating income increased 1.6% to $5.0 million with an operating margin of 7.6%.
The company held $16,000 in cash and equivalents as of December 31, 2023. Escalade generated $20.6 million of cash flow from operations in the quarter.
As of December 31, 2023, the company had $66.8 million of availability on its senior secured revolving credit facility maturing in 2027.
EPS for the quarter was $0.21, up from the EPS of $0.20 last year.
Escalade’s Board of Directors has declared a quarterly dividend of $0.15 per share of common stock. The dividend is payable on April 22, 2024, to all shareholders of record at the close of business on April 15, 2024.
“Given lower inventory costs, reduced freight and storage expenses, operational improvements, and continued price discipline, we see a pathway to improve margins as we move through 2024,” said President and CEO Walter P. Glazer, Jr.
Price Action: ESCA shares closed higher by 4.25% at $13.75 on Thursday.
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