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Sturm, Ruger & Company, Inc. Reports Second Quarter Diluted Earnings of $1.22 Per Share and Declares Dividend of 49¢ Per Share

Sturm, Ruger & Company, Inc. (NYSE-RGR) announced today that for the second quarter of 2016 the Company reported net sales of $167.9 million and diluted earnings of $1.22 per share, compared with net sales of $140.9 million and diluted earnings of 91¢ per share in the second quarter of 2015. For the six months ended July 2, 2016, net sales were $341.1 million and fully diluted earnings were $2.44 per share. For the corresponding period in 2015, net sales were $277.8 million and fully diluted earnings were $1.71 per share.

The Company also announced today that its Board of Directors declared a dividend of 49¢ per share for the second quarter for stockholders of record as of August 12, 2016, payable on August 26, 2016. This dividend varies every quarter because the Company pays a percentage of earnings rather than a fixed amount per share. This dividend is approximately 40% of net income.

Chief Executive Officer Michael O. Fifer made the following observations related to the Company's 2016 second quarter performance:

  • In the second quarter of 2016, net sales increased 19% and earnings per share increased 34% from the second quarter of 2015.
  • EBITDA was $45 million, or 27% of sales, in the second quarter of 2016, an increase of 25% from $36 million, or 26% of sales, in the comparable prior year period.
  • New products, including the American Pistol, the Precision Rifle, the AR-556 modern sporting rifle, and the LC9s pistol, represented $53 million or 33% of firearm sales in the second quarter of 2016. New product sales include only major new products that were introduced in the past two years.
  • The estimated unit sell-through of the Company's products from the independent distributors to retailers increased 20% in the second quarter of 2016 from the comparable prior year period. For the same period, the National Instant Criminal Background Check System background checks (as adjusted by the National Shooting Sports Foundation) increased 15%.
  • The increase in estimated sell-through of the Company's products from the independent distributors to retailers is attributable to:
    • the increase in overall industry demand,
    • strong demand for certain new products, and
    • increased production of several products in strong demand.
  • During the second quarter of 2016, the Company's finished goods inventory increased by 25,700 units and distributor inventories of the Company's products increased by 50,300 units.
  • Cash generated from operations during the first half of 2016 was $66 million. At July 2, 2016, our cash totaled $103 million. Our current ratio is 2.8 to 1 and we have no debt.
  • In the first half of 2016, capital expenditures totaled $11 million, much of it related to tooling and equipment for new products. We expect our 2016 capital expenditures to total approximately $30 million.
  • In the first half of 2016, the Company returned $16 million to its shareholders through the payment of dividends.
  • At July 2, 2016, stockholders' equity was $255 million, which equates to a book value of $13.27 per share, of which $5.37 per share is cash.

Today, the Company filed its Quarterly Report on Form 10-Q. The financial statements included in this Quarterly Report on Form 10-Q are attached to this press release. - View Release
Tomorrow, August 3, 2016, Sturm, Ruger will host a webcast at 9:00 a.m. ET to discuss the second quarter operating results. Interested parties can access the webcast at www.ruger.com/corporate or by dialing 720-634-2919, participant code 50151643.

The Quarterly Report on Form 10-Q is available on the SEC website at www.sec.gov and the Ruger website at www.ruger.com/corporate. Investors are urged to read the complete Quarterly Report on Form 10-Q to ensure that they have adequate information to make informed investment judgments.