Compass Diversified’s decision to divest its Marucci Sports business to Fox Factory for $572 million after purchasing the brand for $200 million in 2020 will help the company reduce its cost of capital and give it “greater ability to increase shareholder returns,” it said in a statement.
In Q3 ended Sept. 30, the group’s branded consumer segments related to sports, outdoor and apparel (5.11 Tactical, Boa, Marucci Sports, PrimaLoft, and Velocity Outdoor) lost $17 million against a profit of $15.3 million in the year-ago period. The result was impacted by a $32.6 million non-cash impairment charge at Velocity. Total Q3 sales for the same five companies fell by 7.0 percent to $286.4 million from $307.8 million, negatively impacted by a nearly 28 percent decline at Velocity and a 25.5 percent sales drop at Boa that was affected by destocking in the footwear industry.
The group has elevated its FY23 outlook. The consolidated subsidiary adjusted Ebitda range has been raised to $450 to $465 million, with full-year adjusted earnings, including Marucci, forecasted at $130 to $140 million.
