March 12th, 2026

The call presented a balanced picture: tangible operational strengths (consistent POS growth, >26% of sales from new products, outdoor-lifestyle expansion, inventory reduction, strong liquidity, and maintained full-year guidance) contrast with notable near-term headwinds (tariff-driven margin pressure, a $3.4M impairment for the UST divestiture, a $1.2M inventory reserve, a meaningful decline in the aiming solutions subcategory, and lower GAAP profitability metrics). Management emphasized disciplined capital allocation and confidence in the underlying operating model while acknowledging ongoing tariff and retailer inventory uncertainties.

Company Guidance

The company reiterated full-year fiscal 2026 guidance with net sales expected at approximately $191.0M–$193.0M, full-year gross margin of 42%–43%, and adjusted EBITDA of 4.0%–4.5% of net sales (with a long‑term target of 25%–30% EBITDA on net sales above $200M); it lowered FY CapEx to $3.5M–$4.0M (down $0.5M). Key balance‑sheet and Q3 metrics cited include Q3 net sales of $56.6M (down 3.3% Y/Y), Q3 gross margin of 41% (down 370 bps; would have been 43.1% excluding a $1.2M inventory reserve), Q3 adjusted EBITDA $3.3M (vs. $4.7M LY), GAAP EPS -$0.32 and non‑GAAP EPS $0.12, recognition of ~$1.7M of IEEPA tariffs in Q3, a $3.4M non‑cash impairment on UST, inventory down to $110.2M from $124.0M (guidance ~ $110M at year‑end), operating cash inflow of $9.9M in Q3, cash on hand $10.4M, no debt with $0 drawn on a $75M line and total available capital > $100M, and a diluted share base of ~12.5M (after repurchasing ~$1.4M / ~181k shares at $7.87 average). The outlook also flags Q4 gross‑margin pressure from tariff amortization and notes that FY net‑sales would be down ~13%–14% including a $10M retailer pull‑forward (about a ~5% underlying decline after adjustment).