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Smith & Wesson Holding grows 27.4% in first quarter of 2006
16 Jun '06
9 min read
Operational Improvements
Golden added, "We made notable operating improvements in our Springfield factory throughout the year in manufacturing processes, supply chain management, and lean manufacturing practices. In November 2005, improved efficiencies allowed us to return to a five-day work schedule in most of our machining operations, from the seven-day schedule we implemented in January 2005.
This helped to reduce overtime expense and provides us with future capacity flexibility. Manufacturing efficiencies continued to improve throughout the fiscal year, helping to achieve the fourth quarter gross margin of 34.8 percent. We invested $15.6 million in the fiscal year to upgrade and purchase manufacturing equipment, geared primarily toward increasing pistol capacity and improving manufacturing processes."
Revised Outlook for Fiscal 2007
We are increasing our sales expectations to between $180 million and $186 million for fiscal 2007, which would be a 14 percent to 18 percent increase over fiscal 2006 sales. This increased sales expectation does not include results of any potential future diversification initiatives, but does include growth in our existing consumer market, as well as continued penetration of the law enforcement, federal government, and international markets. Both the M&P pistol series and the M&P tactical rifle series are expected to be key drivers in the sales increase for fiscal 2007.
Net income is now anticipated tobe between $12.5 million and $13.5 million, or between $0.30 and $0.32 per diluted share. This would represent a 44 percent to 55 percent increase in net income over fiscal 2006.
Golden added, "We made notable operating improvements in our Springfield factory throughout the year in manufacturing processes, supply chain management, and lean manufacturing practices. In November 2005, improved efficiencies allowed us to return to a five-day work schedule in most of our machining operations, from the seven-day schedule we implemented in January 2005.
This helped to reduce overtime expense and provides us with future capacity flexibility. Manufacturing efficiencies continued to improve throughout the fiscal year, helping to achieve the fourth quarter gross margin of 34.8 percent. We invested $15.6 million in the fiscal year to upgrade and purchase manufacturing equipment, geared primarily toward increasing pistol capacity and improving manufacturing processes."
Revised Outlook for Fiscal 2007
We are increasing our sales expectations to between $180 million and $186 million for fiscal 2007, which would be a 14 percent to 18 percent increase over fiscal 2006 sales. This increased sales expectation does not include results of any potential future diversification initiatives, but does include growth in our existing consumer market, as well as continued penetration of the law enforcement, federal government, and international markets. Both the M&P pistol series and the M&P tactical rifle series are expected to be key drivers in the sales increase for fiscal 2007.
Net income is now anticipated tobe between $12.5 million and $13.5 million, or between $0.30 and $0.32 per diluted share. This would represent a 44 percent to 55 percent increase in net income over fiscal 2006.
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