1 Company Is Laughing at Dick’s AR Ban

Good news for Smith & Wesson. Last week, the parent company of the popular firearms manufacturer (American Outdoor Brands) told their investors that Dick’s Sporting Goods’ policy changes won’t have a huge impact on their profits.

This comes as a relief, as Dick’s made the announcement last week that they are no longer carrying “assault-style” rifles. They said they will also ban sales to anyone under the age of 21.

According to James Debney (American Outdoor Brands’ Chief Executive Officer), only 3 percent of the conglomerate’s sales come from big box retailers like Dick’s Sporting Goods. 

As Guns.com states:

“It’s extremely small,” Debney said. “It’s actually one-tenth of one percentage point of our total sales. So, there isn’t really any impact and, of course, anything like this is obviously built into our guidance going forward.”

Debney says that sporting rifles make up only a small portion of American Outdoor Brands’ revenue – just about 10-12 percent. This is in sharp contrast to the enormous revenue the conglomerate gains from handguns (55 percent) and other outdoor product lines (25 percent).

Debney says these other outdoor products have been a big help in cushioning revenue made from a difficult year in dropping gun sales.

According to Debney:

“Overall, our long term strategy remains focused on being the leading provider of quality product for the shooting, hunting and rugged outdoor enthusiast,” he said. “Continued growth in our outdoor products and accessories business helped us better balance our overall revenue by mitigating the volatility we have experienced with our firearms business.”

American Outdoor Brands’ Chief Executive Officer also states that the conglomerate will have their eyes on the future and plan accordingly. Debney states that their plan is to assume that the next 12 to 18 months their firearm sales will bring “flattish” revenues.

According to Guns.com:

American Outdoor Brands reported a 32.6 percent decrease in revenue for the third financial quarter ending Jan. 31. The company’s firearms segment tanked 40 percent while its burgeoning outdoor product segment increased more than 13 percent. Debney said the company also reduced its manufacturing workforce 25 percent over the last year, eliminating 200 positions overall.

Debney and Chief Financial Officer Jeffrey Buchanan wouldn’t forecast how the corporate backlash over the recent mass shooting in southern Florida would impact the company’s earnings. “What’s going to happen in 12 months or six months is a little hard to speculate right now since the environment overall right now politically and otherwise is pretty, pretty volatile,” Buchanan said.

WalmartKroger, and L.L. Bean followed Dick’s lead last week, implementing similar policies as a response to the Valentine’s Day shooting at a high school in Parkland, Florida that left 17 dead and more than a dozen injured.

REI and Mountain Equipment Co-Op likewise halted new orders with Vista Outdoor over the company’s significant profits from firearms and ammunition and its ties with the National Rifle Association.

“REI does not sell guns,” the retailer said in a news release Thursday. “We believe that it is the job of companies that manufacture and sell guns and ammunition to work towards common sense solutions that prevent the type of violence that happened in Florida last month.”

Debney addressed the shooting during a conference call with investors Thursday, calling it “incomprehensible and a senseless loss of life.”

“We share the desire to make our community safer,” he said. “Through our membership and work with the National Shooting Sports Foundation, we will continue to support the development of effective solutions that accomplished that objective while protecting the rights of the law-abiding firearm owner.”