Clarus Corp., the parent company of Black Diamond Equipment and Pieps, announced that its revenues surged by 24 percent to $75.9 million in the fourth quarter, or by 23 percent in constant currencies. This was mostly due to the company’s ammunition division, particularly with gains in the Sierra Bullets business, which grew by 167 percent, and an additional $6.6 million in sales at Barnes Bullets. Clarus acquired the Barnes bullet maker brand out of Remington’s bankruptcy in October. Excluding Barnes, the company’s quarterly sales increased by 14 percent on an organic basis as compared to the year-ago quarter.
Black Diamond’s quarterly revenues were flat at $55.8 million, led by apparel, which progressed by 19 percent. However, the Climb category declined by 15 percent and Mountain lost 12 percent, while Ski inched up by 3 percent, weighed down by supply chain challenges. Direct-to-consumer sales grew by 12 percent. The management said that the brand experienced a recovery in consumer demand, after a difficult first half of the year, when stores were forced to close around the globe due to the outbreak of the pandemic. Clarus avoided discounting Black Diamond products during the most difficult period to preserve its equity.
Europe recorded a growth of 10 percent, led by apparel, climb and mountain, as markets reopened. However, this was offset by softness in the international distributor business due to the impact of the pandemic.
Clarus’ gross margin remained flat at 35.5 percent, with improvements in product mix, low levels of discounting and foreign exchange benefits being offset by unfavorable impacts on the supply chain and logistics due to Covid-19. Excluding a fair value inventory step-up associated with Barnes’ acquisition, the adjusted gross margin increased by 0.5 percentage points to 36.0 percent.
Adjusted Ebitda reached $11.0 million in the fourth quarter, up by 56 percent. Net income of $7.1 million compared with $12.4 million for the year‐ago quarter, when the company received a $10.4 million net benefit associated with the partial release of its valuation allowance on its deferred tax assets. The adjusted net income surged by 64 percent to $11.2 million.
Hit hard by the pandemic, Black Diamond saw its sales decline by 14 percent for the year. The ammunition division also drove the group’s revenues for the full year, which fell to $224.0 million from $229.4 million. As a result, Clarus’ sales went up in the U.S. and declined in the rest of the world.
The annual gross margin inched down by 0.3 percentage points to 35.0 percent due to unfavorable impacts on the supply chain and the logistics. Adjusted Ebitda for the year stood at $22.4 million, down from $22.7 million in 2019. Net income fell from $19.0 million to $5.5 million.
For 2021, Clarus anticipates sales to grow by about 25 percent to $280 million, including a 17 percent gain for Black Diamond, whose sales should reach about $200 million. The group expects adjusted Ebitda to rise by 56 percent to $35 million.