American Outdoor Brands, Inc. (NASDAQ:AOUT) Q4 2023 Earnings Call Transcript

Brian Murphy: Yes. Look, over the last two to three years, the retailers were in a period of just get me everything you can. They were really starved for inventory with supply chain constraints. And the result of that is they really didn’t have a chance or an opportunity to see who the winners and losers were, which brands and products were performing well and which ones won’t. And so then they had too much inventory and obviously, they’re lowering that overall amount. But they now have a year or so under their belt where they’ve been able to analyze who’s doing well and where do we need to make some changes. So the beginning of, I’ll call it, a normalization in terms of their own process. And as Andy spoke to this last fall, we had our very successful line review season that will allow us to capture market share in the back half of this year and also some success with new product placement.

Eric Wold: I guess maybe let me ask you a different way. I mean do you expect point-of-sale for your products to grow this year? Or is that sales growth more a catch-up from retailers being too cautious on the “winners” and taking your inventory down too much, you’re just kind of recouping back from inventory? Or do you actually expect point-of-sale to increase this year?

Brian Murphy: It’s a great. It’s a really good question. It’s Brian again. I think that, like I said, that what we know today, right, is POS, we alluded to is down in the single-digits for our products. But I would say that’s fared very well compared to the opening and mid-level price point options that are out there where we don’t tend to play. And so I think within that higher price point item in the brands that we have, I would expect it to remain pretty stable. But with that said, I think the icing on the cake there is the market share gains from the line review process and the new products.

Eric Wold: Got it. That helps. And then last question. Just last question. I know you talked about your expectation for outdoor lifestyle to continue to gain share, market share or gain share as a percentage of your sales going forward. Maybe give us a sense of the other side, what is your current view on kind of fire of demand, the inventory landscape out there for your products? And when you expect outdoor lifestyle to gain share do you expect Shooting Sports sales to grow as well or but just less than outdoor lifestyle or do you actually don’t expect growth in that side of the business?

Andrew Fulmer: Yes, Eric, this is another great question. So over the long-term, outdoor lifestyle, we look at the total addressable market for outdoor lifestyle is just much bigger. With that said, we’re firmly entrenched in the Shooting Sports. We have great new products from Caldwell to Frankford arsenal. So we expect that Shooting Sports will grow over time. It’s just that the outdoor lifestyle has a bigger market to grow into.

Brian Murphy: Yes. The thing that I’ll add real quick to is we’ve really focused on some of the larger stable categories within Shooting Sports, which is why you’re seeing products like the Claymore, Caldwell Claymore, performed very, very well for us, new product and the Frankford Arsenal extent. So they’re in portions of that market that we feel are very stable and will continue to grow over time along with that installed base. And that’s really where we’re focusing most of our efforts. Still, obviously, Crimson Trace brand in aiming solutions is an important brand, and it’s a blue-chip brand within that space. But we like the diversification of getting into some of these other categories for long-term.

Eric Wold: Got it. Thanks a lot. Thank you guys. It’s helpful.

Brian Murphy: Thanks, Eric.

Operator: [Operator Instructions] The next question is from Matt Koranda with ROTH MKM. Please go ahead.