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What changed in American Outdoor Brands, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of American Outdoor Brands, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+84 added−106 removedSource: 10-K (2024-06-27) vs 10-K (2023-06-28)

Top changes in American Outdoor Brands, Inc.'s 2024 10-K

84 paragraphs added · 106 removed · 64 edited across 4 sections

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLocation Facility Columbia, Missouri Corporate Office and Warehouse Holland, Michigan Storefront Chicopee, Massachusetts Administrative Office Shenzhen, Peoples Republic of China Office I tem 3. Legal Proceedings Information regarding our legal proceedings is discussed in Note 16 to our consolidated and combined financial statements, which is incorporated herein by reference. I tem 4.
Biggest changeLocation Facility Columbia, Missouri Corporate Office and Warehouse Chicopee, Massachusetts Administrative Office Shenzhen, Peoples Republic of China Office Yangjiang, Peoples Republic of China Office 44 I tem 3. Legal Proceedings Information regarding our legal proceedings is discussed in Note 15 to our consolidated financial statements, which is incorporated herein by reference. I tem 4.
Item 2. P roperties The following table sets forth information regarding our principal operating properties and other significant properties as of April 30, 2023. All the properties listed below are leased. In general, our operating properties are well maintained, suitably equipped, and in good operating condition.
Item 2. P roperties The following table sets forth information regarding our principal operating properties and other significant properties as of April 30, 2024. All the properties listed below are leased. In general, our operating properties are well maintained, suitably equipped, and in good operating condition.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table sets forth certain information relating to the purchases of our common stock by us and any affiliated purchasers within the meaning of Rule 10b-18(a)(3) under the Exchange Act during the fiscal year ended April 30, 2023 (dollars in thousands, except per share data): Total # of Average Total # of Shares Purchased as Part of Publicly Announced Maximum Dollar Value of Shares that May Yet Be Purchased Shares Price Paid Plan or Under the Plan Period Purchased Per Share (2) Program (1) or Program Total second quarter fiscal year 2023 84,029 $ 8.97 84,029 $ 9,246 Total third quarter fiscal year 2023 191,632 9.43 275,661 7,440 February 1, 2023 to February 28, 2023 21,048 10.24 296,709 7,224 March 1, 2023 to March 31, 2023 41,031 9.44 337,740 6,837 April 1, 2023 to April 30, 2023 39,294 9.16 377,034 6,477 Total fourth quarter fiscal year 2023 101,373 9.50 377,034 6,477 Total year-to-date fiscal year 2023 377,034 $ 9.34 377,034 $ 6,477 (1) On September 30, 2022, our Board of Directors authorized the repurchase of up to $10.0 million of our common stock, subject to certain conditions, in the open market, in block purchases, or in privately negotiated transactions, executable through September 29, 2023.
Biggest changeThe following table sets forth certain information relating to the purchases of our common stock by us and any affiliated purchasers within the meaning of Rule 10b-18(a)(3) under the Exchange Act during the fiscal year ended April 30, 2024 (dollars in thousands, except per share data): Total # of Average Total # of Shares Purchased as Part of Publicly Announced Maximum Dollar Value of Shares that May Yet Be Purchased Shares Price Paid Plan or Under the Plan Period Purchased Per Share (2) Program (1) or Program Total first quarter fiscal year 2024 267,991 $ 8.43 267,991 $ 4,217 Total second quarter fiscal year 2024 157,536 9.46 425,527 9,537 Total third quarter fiscal year 2024 209,548 8.53 635,075 7,747 February 1, 2024 to February 29, 2024 40,751 8.66 675,826 7,396 March 1, 2024 to March 31, 2024 13,591 8.16 689,417 7,283 Total fourth quarter fiscal year 2024 54,342 8.50 689,417 7,283 Total year-to-date fiscal year 2024 689,417 $ 8.75 689,417 $ 7,283 (1) On September 30, 2022, our Board of Directors authorized the repurchase of up to $10.0 million of our common stock, subject to certain conditions, in the open market, in block purchases, or in privately negotiated transactions, executable through September 29, 2023.
Securities Authorized for Issuance under Equity Compensation Plans For equity compensation plan information, refer to Item 12 (Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters) in Part III of this Annual Report on Form 10-K. 46 Performance Graph The following graph compares the cumulative total stockholder returns for the period from August 25, 2020 (the effective date of the registration of AOUT Common Stock) to April 30, 2023 for (i) our common stock; (ii) the Russell 2000 Index; and (iii) the S&P 500 Index.
Securities Authorized for Issuance under Equity Compensation Plans For equity compensation plan information, refer to Item 12 (Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters) in Part III of this Annual Report on Form 10-K. 46 Performance Graph The following graph compares the cumulative total stockholder returns for the period from August 25, 2020 (the effective date of the registration of AOUT Common Stock) to April 30, 2024 for (i) our common stock; (ii) the Russell 2000 Index; and (iii) the S&P 500 Index.
The graph assumes an investment of $100 on August 25, 2020 (first day of trading activity) through the last trading day of fiscal 2023.
The graph assumes an investment of $100 on August 25, 2020 (first day of trading activity) through the last trading day of fiscal 2024.
Holders On June 21, 2023, there were 228 record holders of our common stock. A substantially greater number of holders of common stock are “street name” or beneficial holders, whose shares are held of record by banks, brokers, and other financial institutions. Dividend Policy We have never declared or paid cash dividends on our common stock.
Holders On June 24, 2024, there were 258 record holders of our common stock. A substantially greater number of holders of common stock are “street name” or beneficial holders, whose shares are held of record by banks, brokers, and other financial institutions. Dividend Policy We have never declared or paid cash dividends on our common stock.
The performance graph above will not be deemed incorporated by reference into any filing of our company under the Securities Act of 1933, as amended, or the Securities Act. 47 Repurchases of Common Stock As of April 30, 2023, we had one open authorized share repurchase program.
The performance graph above will not be deemed incorporated by reference into any filing of our company under the Securities Act of 1933, as amended, or the Securities Act. Recent Sales of Unregistered Securities None. 47 Repurchases of Common Stock As of April 30, 2024, we had one open authorized share repurchase program.
During the fiscal year ended April 30, 2023, under this authorization, we repurchased 377,034 shares of our common stock in the open market for $3.5 million utilizing cash on hand. (2) The average price per share excludes fees paid to acquire the shares. Item 6. RESERVED Not Applicable. 48
During the fiscal years ended April 30, 2024 and 2023, under these authorizations, we repurchased 689,417 and 377,034 shares, respectively, of our common stock in the open market for $6.0 million and $3.5 million, respectively, utilizing cash on hand. (2) The average price per share excludes fees paid to acquire the shares. Item 6. RESERVED Not Applicable. 48
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This authorization expired on September 29, 2023. On October 2, 2023, our Board of Directors authorized the repurchase of up to $10.0 million of our common stock, subject to certain conditions, in the open market, in block purchases, or in privately negotiated transactions, executable through September 30, 2024.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeOperating Expenses The following table sets forth certain information regarding operating expenses for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Research and development $ 6,361 $ 5,501 $ 860 15.6 % Selling, marketing, and distribution 51,791 56,168 (4,377 ) -7.8 % General and administrative 42,612 41,244 1,368 3.3 % Impairment of long-lived assets — 67,849 (67,849 ) -100.0 % Total operating expenses $ 100,764 $ 170,762 $ (69,998 ) -41.0 % % of net sales 52.7 % 69.0 % Fiscal 2023 Operating Expenses Compared with Fiscal 2022 Excluding the impact of our non-cash goodwill impairment charge recorded during fiscal 2022, operating expenses in fiscal 2023 decreased $2.1 million compared with the prior fiscal year.
Biggest changeFiscal 2024 Cost of Sales and Gross Profit Compared with Fiscal 2023 Gross margin for fiscal 2024 decreased 210 basis points from the prior fiscal year, primarily from higher tariff, freight, and duty expenses from increased inventory purchases earlier in fiscal 2024, increased promotional product discounts, and a tariff drawback adjustment due to an audit of a claim submitted in fiscal 2022. 50 Operating Expenses The following table sets forth certain information regarding operating expenses for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Research and development $ 6,851 $ 6,361 $ 490 7.7 % Selling, marketing, and distribution 55,050 51,791 3,259 6.3 % General and administrative 39,022 42,612 (3,590 ) -8.4 % Total operating expenses $ 100,923 $ 100,764 $ 159 0.2 % % of net sales 50.2 % 52.7 % Fiscal 2024 Operating Expenses Compared with Fiscal 2023 Operating expenses in fiscal 2024 increased $159,000 compared with the prior fiscal year.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following Management’s Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our consolidated and combined financial statements and the related notes thereto contained elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties, and assumptions.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations You should read the following Management’s Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our consolidated financial statements and the related notes thereto contained elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties, and assumptions.
Our e-commerce channels also include our direct-to-consumer sales. Our traditional channels include customers that primarily operate out of physical brick-and-mortar stores and generate the large majority of revenue from consumer purchases in their brick-and-mortar locations. We sell our products worldwide.
Our e-commerce channels also include our direct-to-consumer sales. Our traditional channels include customers that primarily operate out of physical 49 brick-and-mortar stores and generate the large majority of revenue from consumer purchases in their brick-and-mortar locations. We sell our products worldwide.
Although we do not believe that inflation had a material impact on us during fiscal 2023, increased inflation in the future may have a negative effect on our ability to achieve certain expectations in gross margin and operating expenses.
Although we do not believe that inflation had a material impact on us during fiscal 2024, increased inflation in the future may have a negative effect on our ability to achieve certain expectations in gross margin and operating expenses.
We expect our inventory balance to increase in our first quarter of fiscal 2024 because of increased inventory purchases to support the fall hunting and winter holiday shopping seasons as well as inventory for new products that we expect to launch later in the year.
We expect our inventory balance to increase in our first quarter of fiscal 2025 because of increased inventory purchases to support the fall hunting and winter holiday shopping seasons as well as inventory for new products that we expect to launch later in the year.
Set forth below is a comparison of the results of operations and changes in financial condition for the fiscal years ended April 30, 2023 and 2022.
Set forth below is a comparison of the results of operations and changes in financial condition for the fiscal years ended April 30, 2024 and 2023.
The comparison of, and changes between, the fiscal years ended April 30, 2022 and 2021 can be found within “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Form 10-K for the fiscal year ended April 30, 2022 filed with the SEC on July 14, 2022. Background We operate as one reporting segment.
The comparison of, and changes between, the fiscal years ended April 30, 2023 and 2022 can be found within “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Form 10-K for the fiscal year ended April 30, 2023 filed with the SEC on June 28, 2023. Background We operate as one reporting segment.
Our future capital requirements will depend on many factors, including net sales, the timing and extent of spending to support product development efforts, the expansion of sales and marketing activities, the timing of introductions of new products and enhancements to existing products, the capital needed to operate as an independent publicly traded company, enhancements to our enterprise resource planning systems, and any acquisitions or strategic investments that we may determine to make.
Our future capital requirements will depend on many factors, including net sales, the timing and extent of spending to support product development efforts, the expansion of sales and marketing activities, the timing of introductions of new products and enhancements to existing products, and any acquisitions or strategic investments that we may determine to make.
Critical Accounting Estimates Revenue Recognition We recognize revenue for the sale of our products at the point in time when the control of ownership has transferred to the customer, which is generally upon shipment but could be delayed until the receipt of customer acceptance.
Additionally, inflation may cause consumers to reduce discretionary spending, which could cause decreases in demand for our products. 54 Critical Accounting Estimates Revenue Recognition We recognize revenue for the sale of our products at the point in time when the control of ownership has transferred to the customer, which is generally upon shipment but could be delayed until the receipt of customer acceptance.
Financing Activities Cash used in financing activities was $23.5 million in fiscal 2023 compared with cash provided by financing activities of $10.3 million in the prior fiscal year.
Financing Activities Cash used in financing activities was $10.8 million in fiscal 2024 compared with cash usage by financing activities of $23.5 million in the prior fiscal year.
We had $22.0 million and $19.5 million of cash equivalents on hand as of April 30, 2023 and 2022, respectively.
We had $29.7 million and $22.0 million of cash equivalents on hand as of April 30, 2024 and 2023, respectively.
Other obligations represent other binding commitments for the expenditure of funds, including (i) amounts related to contracts not involving the purchase of inventories, such as the noncancelable portion of service or maintenance agreements for management information systems, (ii) capital spending, and (iii) advertising.
This obligation excludes the amount included in accounts payable at April 30, 2024 related to inventory purchases. Other obligations represent other binding commitments for the expenditure of funds, including (i) amounts related to contracts not involving the purchase of inventories, such as the noncancelable portion of service or maintenance agreements for management information systems, (ii) capital spending, and (iii) advertising.
Based upon our history of generating strong cash flows, we believe we will be able to meet our short-term liquidity needs. We also believe we will meet known or reasonably likely future cash requirements through the combination of cash flows from operating activities, available cash balances, and available borrowings through our existing $75.0 million credit facility.
We also believe we will meet known or reasonably likely future cash requirements through the combination of cash flows from operating activities, available cash balances, and available borrowings through our existing $75.0 million credit facility.
Fiscal 2023 income tax benefit was primarily because of recording return to provision adjustments relating to the Federal and State tax returns filed for the prior fiscal year and the impact of refundable state tax credits. Fiscal 2022 income tax expense was primarily due to recording a full valuation allowance against our deferred tax assets.
Fiscal 2024 income tax benefit was primarily because of the impact of refundable state tax credits. Fiscal 2023 income tax benefit was primarily because of recording return to provision adjustments relating to the Federal and State tax returns filed for the prior fiscal year and the impact of refundable state tax credits.
Net Loss The following table sets forth certain information regarding net loss and the related per share data for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands, except per share data): 2023 2022 $ Change % Change Net loss $ (12,024 ) $ (64,880 ) $ 52,856 -81.5 % Net loss per share Basic $ (0.90 ) $ (4.66 ) $ 3.76 -80.7 % Diluted $ (0.90 ) $ (4.66 ) $ 3.76 -80.7 % Fiscal 2023 Net Loss Compared with Fiscal 2022 We had a net loss of $12.0 million, or ($0.90) per diluted share in fiscal 2023.
Net Loss The following table sets forth certain information regarding net loss and the related per share data for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands, except per share data): 2024 2023 $ Change % Change Net loss $ (12,248 ) $ (12,024 ) $ (224 ) 1.9 % Net loss per share Basic $ (0.94 ) $ (0.90 ) $ (0.04 ) 4.4 % Diluted $ (0.94 ) $ (0.90 ) $ (0.04 ) 4.4 % Fiscal 2024 Net Loss Compared with Fiscal 2023 We had a net loss of $12.2 million, or ($0.94) per diluted share in fiscal 2024 compared to $12.0 million, or ($0.90) per diluted share in fiscal 2023.
If we are unable to offset the negative impacts of inflation with increased prices, our future results from operations and cash flows would be materially impacted. Additionally, inflation may cause consumers to reduce discretionary spending, which could cause decreases in demand for our products.
If we are unable to offset the negative impacts of inflation with increased prices, our future results from operations and cash flows would be materially impacted.
Net sales in our e-commerce channel decreased $10.2 million, or 10.5%, from the prior fiscal year, primarily as a result of lower net sales to the world’s largest e-commerce retailer because of reduced demand primarily in our shooting sports category as well as their efforts to reduce their overall inventory.
Net sales in our e-commerce channel decreased $2.9 million, or 3.3%, from the prior fiscal year, primarily because of lower net sales to the world's largest e-commerce retailer as a result of reduced orders. E-commerce channel net sales for our shooting sports category decreased because of lower net sales for certain personal protection products.
Fiscal 2023 Highlights Our operating results for fiscal 2023 included the following: • Net sales were $191.2 million, a decrease of $56.3 million, or 22.8%, from the prior fiscal year, reflecting a decrease in net sales for both our e-commerce channels and our traditional channels, partially offset by an increase in our own direct-to-consumer business. • Gross margin was 46.1%, a decrease of 10 basis points from the prior fiscal year. • Net loss was $12.0 million, or ($0.90) per diluted share, compared with a net loss of $64.9 million, or ($4.66) per diluted share, for the prior fiscal year.
Fiscal 2024 Highlights Our operating results for fiscal 2024 included the following: • Net sales were $201.1 million, an increase of $9.9 million, or 5.2%, over the prior fiscal year, reflecting an increase in net sales for our traditional channel partially offset by a decrease in net sales for our e-commerce channels. • Gross margin was 44.0%, a decrease of 210 basis points from the prior fiscal year. • Net loss was $12.2 million, or ($0.94) per diluted share, compared with a net loss of $12.0 million, or ($0.90) per diluted share, for the prior fiscal year. • Non-GAAP Adjusted EBITDAS was $9.8 million, compared with $12.8 million for the prior fiscal year.
Although we generally fulfill the majority of our order backlog, we allow orders received that have not yet shipped to be cancelled, and therefore, our backlog may not be indicative of future sales.
Our order backlog as of April 30, 2024 was $4.0 million, or $3.0 million lower than at the end of fiscal 2023. Although we generally fulfill the majority of our order backlog, we allow orders received that have not yet shipped to be cancelled, and therefore, our backlog may not be indicative of future sales.
Interest Expense, Net The following table sets forth certain information regarding interest expense, net for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Interest expense, net $ (761 ) $ (324 ) $ (437 ) 134.9 % 51 Interest expense, net increased $437,000 from the prior fiscal year because of interest to service our borrowings on our revolving line of credit during fiscal 2023.
Interest Income/(Expense), Net The following table sets forth certain information regarding interest income/(expense), net for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Interest income/(expense), net $ 39 $ (761 ) $ 800 -105.1 % Fiscal 2024 Interest Income/(Expense) Compared with Fiscal 2023 Interest income was $39,000 compared to interest expense of $761,000 in the prior fiscal year because of lower interest on a reduced level of borrowings on our revolving line of credit during fiscal 2024.
Income Taxes The following table sets forth certain information regarding income tax expense for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Income tax (benefit)/expense $ (249 ) $ 9,344 $ (9,593 ) -102.7 % % of income from operations (effective tax rate) 2.0 % -16.8 % 18.8 % We recorded an income tax benefit of $249,000 for fiscal 2023 because of lower operating profit compared to income tax expense of $9.3 million for fiscal 2022.
Income Taxes The following table sets forth certain information regarding income tax expense for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Income tax (benefit) $ (70 ) $ (249 ) $ 179 -71.9 % % of income from operations (effective tax rate) 0.6 % 2.0 % -1.4 % 51 Fiscal 2024 Income Tax Benefit Compared with Fiscal 2023 We recorded an income tax benefit of $70,000 for fiscal 2024 as compared to income tax benefit of $249,000 for fiscal 2023.
Results of Operations Net Sales and Gross Profit The following table sets forth certain information regarding consolidated and combined net sales for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Net sales $ 191,209 $ 247,526 $ (56,317 ) -22.8 % Cost of sales 103,145 133,287 (30,142 ) -22.6 % Gross profit $ 88,064 $ 114,239 $ (26,175 ) -22.9 % % of net sales (gross margin) 46.1 % 46.2 % 49 The following table sets forth certain information regarding trade channel net sales for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change e-commerce channels $ 87,219 $ 97,418 $ (10,199 ) -10.5 % Traditional channels 103,990 150,108 (46,118 ) -30.7 % Total net sales $ 191,209 $ 247,526 $ (56,317 ) -22.8 % Our e-commerce channels include net sales from customers that do not traditionally operate physical brick-and-mortar stores, but generate the majority of their revenue from consumer purchases from their retail websites.
Results of Operations Net Sales and Gross Profit The following table sets forth certain information regarding consolidated net sales for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Net sales $ 201,099 $ 191,209 $ 9,890 5.2 % Cost of sales 112,673 103,145 9,528 9.2 % Gross profit $ 88,426 $ 88,064 $ 362 0.4 % % of net sales (gross margin) 44.0 % 46.1 % The following table sets forth certain information regarding trade channel net sales for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change e-commerce channels net sales $ 84,313 $ 87,219 $ (2,906 ) -3.3 % Traditional channels net sales 116,786 103,990 12,796 12.3 % Total net sales $ 201,099 $ 191,209 $ 9,890 5.2 % Our e-commerce channels include net sales from customers that do not traditionally operate physical brick-and-mortar stores, but generate the majority of their revenue from consumer purchases from their retail websites.
Cash generated in operating activities was $30.7 million for fiscal 2023 compared with cash usage of $18.0 million for the prior fiscal year.
Cash generated in operating activities was $24.5 million for fiscal 2024 compared to cash generation of $30.7 million for the prior fiscal year.
See non-GAAP financial measure disclosures below for our reconciliation of non-GAAP Adjusted EBITDAS. • We repurchased 377,034 shares of our common stock, in the open market, for a total of $3.5 million during fiscal 2023 leaving $6.5 million available to be purchased under our authorized repurchase program.
See non-GAAP financial measure disclosures below for our reconciliation of Non-GAAP Adjusted EBITDAS. • We repurchased a total of 689,417 shares of our common stock, in the open market, for $6.0 million during fiscal 2024.
Operating lease obligations represent required minimum lease payments during the noncancelable lease term. Most real estate leases also require payments of related operating expenses such as taxes, insurance, utilities, and maintenance, which are not included above. See Note 4, Leases , for additional information.
Most real estate leases also require payments of related operating expenses such as taxes, insurance, utilities, and maintenance, which are not included above. See Note 4, Leases , for additional information. Purchase obligations represent binding commitments to purchase raw materials, contract production, and finished products that are payable upon delivery of the inventory.
In addition, non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. We address the limitations of non-GAAP measures through the use of various GAAP measures.
Adjusted EBITDAS is a non-GAAP measure and may not be comparable to similar measures reported by other companies. In addition, non-GAAP measures have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP.
Based on our review of ASC 350-20, we have determined that we have one operating unit. 55 We evaluate the recoverability of long-lived assets on an annual basis on February 1 or whenever events or changes in circumstances indicate that carrying amounts may not be recoverable.
Valuation of Long-lived Intangible Assets We evaluate the recoverability of long-lived assets, or asset group, on an annual basis or whenever events or changes in circumstances indicate that carrying amounts may not be recoverable.
Investing Activities Cash used in investing activities was $4.8 million for fiscal 2023 compared with cash usage of $33.6 million for the prior fiscal year. This decrease was primarily because of the $27.0 million used to acquire Grilla Grills during fiscal 2022.
Investing Activities Cash used in investing activities was $6.0 million for fiscal 2024 compared with cash usage of $4.8 million for the prior fiscal year.
We believe it is useful to investors and analysts to evaluate this non-GAAP measure on the same basis as we use to evaluate our operating results. 52 Adjusted EBITDAS is a non-GAAP measure and may not be comparable to similar measures reported by other companies.
We also use Adjusted EBITDAS to supplement GAAP measures of performance to evaluate our performance in connection with compensation decisions. We believe it is useful to investors and analysts to evaluate this non-GAAP measure on the same basis as we use to evaluate our operating results.
The following table sets forth certain information regarding geographic makeup of net sales included in the above table for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Domestic net sales $ 182,299 $ 234,803 $ (52,504 ) -22.4 % International net sales 8,910 12,723 (3,813 ) -30.0 % Total net sales $ 191,209 $ 247,526 $ (56,317 ) -22.8 % The following table sets forth certain information regarding net sales categories for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Shooting sports $ 88,885 $ 128,180 $ (39,295 ) -30.7 % Outdoor lifestyle 102,324 119,346 (17,022 ) -14.3 % Total net sales $ 191,209 $ 247,526 $ (56,317 ) -22.8 % Fiscal 2023 Net Sales Compared with Fiscal 2022 Total net sales decreased $56.3 million, or 22.8%, from the prior fiscal year.
The following table sets forth certain information regarding geographic makeup of net sales included in the above table for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Domestic net sales $ 189,027 $ 182,299 $ 6,728 3.7 % International net sales 12,072 8,910 3,162 35.5 % Total net sales $ 201,099 $ 191,209 $ 9,890 5.2 % The following table sets forth certain information regarding net sales categories for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Shooting sports net sales $ 91,716 $ 88,885 $ 2,831 3.2 % Outdoor lifestyle net sales 109,383 102,324 7,059 6.9 % Total net sales $ 201,099 $ 191,209 $ 9,890 5.2 % Fiscal 2024 Net Sales Compared with Fiscal 2023 Total net sales increased $9.9 million, or 5.2%, from the prior fiscal year.
Operating Loss The following table sets forth certain information regarding operating loss for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Operating (loss)/income $ (12,700 ) $ (56,523 ) $ 43,823 -77.5 % % of net sales (operating margin) -6.6 % -22.8 % Fiscal 2023 Operating Income Compared with Fiscal 2022 Excluding our non-cash goodwill impairment charge in fiscal 2022, we had a decrease of $24.0 million in operating income from the prior fiscal year.
Operating Loss The following table sets forth certain information regarding operating loss for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Operating loss $ (12,497 ) $ (12,700 ) $ 203 -1.6 % % of net sales (operating margin) -6.2 % -6.6 % Fiscal 2024 Operating Loss Compared with Fiscal 2023 We had a decrease of $203,000 in operating loss from the prior fiscal year primarily because of increased net sales and lower operating expenses partially offset from an increased in cost of goods sold.
Cash provided by financing activity in fiscal 2022 was primarily from $25.2 million borrowings on our revolving line of credit used to acquire Grilla Grills, offset by $15.0 million to repurchase our common stock under an authorized stock repurchase program.
Cash used in financing activities in fiscal 2024 was because of $5.0 million of payments on our revolving line of credit and $6.0 million of payments to repurchase our common stock under our authorized stock repurchase program.
We have generated $45.5 million of cash from operating activities since the Separation in fiscal 2021. Our ability to fund our operating needs depends on our future ability to continue to generate positive cash flow from operations and obtain financing on acceptable terms.
Our ability to fund our operating needs depends on our future ability to continue to generate positive cash flow from operations and obtain financing on acceptable terms. Based upon our history of generating strong cash flows, we believe we will be able to meet our short-term liquidity needs.
Our international net sales declined primarily because of reduced demand for our shooting sports products and timing of customer shipments. New products, defined as any new SKU introduced over the prior two fiscal years, represented 25.5% of net sales for fiscal 2023 compared to 25.8% of net sales for fiscal 2022.
New products, defined as any new SKU introduced over the prior two fiscal years, represented 23.2% of net sales for fiscal 2024 compared to 25.5% of net sales for fiscal 2023. We have a history of introducing over 200 new SKUs each year.
In the future, we may incur expenses or charges such as those added back to calculate Adjusted EBITDAS. Our presentation of Adjusted EBITDAS should not be construed as an inference that our future results will be unaffected by these items.
We address the limitations of non-GAAP measures through the use of various GAAP measures. In the future, we may incur expenses or charges such as those added back to calculate Adjusted EBITDAS.
Interest on debt is based on outstanding debt as of April 30, 2023, and includes debt issue costs to be amortized over the life of the financing arrangement. The interest rate used to calculate was 6.1% as of April 30, 2023. See Note 10, Debt , for additional information.
Interest on debt is based on outstanding debt as of April 30, 2024, and includes debt issuance costs to be amortized over the life of the financing arrangement. Operating lease obligations represent required minimum lease payments during the noncancelable lease term.
General and administrative expenses increased $1.4 million compared with the prior fiscal year primarily because of $1.2 million of legal and advisory fees associated with the completed cooperation agreement with a stockholder and $461,000 of increased standalone expenses, such as our information technology infrastructure costs, subscription and software costs, and insurance premium costs, partially offset by lower employee compensation-related expenses.
General and administrative expenses decreased $3.6 million from the prior fiscal year primarily because of $1.2 million lower legal and advisory fees associated with a cooperation agreement with a stockholder that occurred in fiscal 2023, $1.7 million of reduced enterprise resource planning system-implementation-related expenses, and lower rent expense as result of the facility consolidations we completed in the prior fiscal year, partially offset by higher compensation-related expenses.
The following table sets forth our calculation of non-GAAP Adjusted EBITDAS for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): For the Years Ended April 30, 2023 2022 (Unaudited) GAAP net loss $ (12,024 ) $ (64,880 ) Interest expense 761 324 Income tax (benefit)/expense (249 ) 9,344 Depreciation and amortization 16,048 16,967 Stock compensation 4,050 2,812 Goodwill impairment — 67,849 Technology implementation 2,138 1,948 Fair value inventory step-up — 27 Acquisition costs 47 599 Facility consolidation costs 866 — Stockholder cooperation agreement costs 1,177 — Other — 40 Non-GAAP Adjusted EBITDAS $ 12,814 $ 35,030 Liquidity and Capital Resources Historically, we have generated strong annual cash flow from operating activities.
Our presentation of Adjusted EBITDAS should not be construed as an inference that our future results will be unaffected by these items. 52 The following table sets forth our calculation of non-GAAP Adjusted EBITDAS for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): For the Years Ended April 30, 2024 2023 (Unaudited) GAAP net loss $ (12,248 ) $ (12,024 ) Interest (income)/expense (39 ) 761 Income tax (benefit)/expense (70 ) (249 ) Depreciation and amortization 16,005 16,048 Stock compensation 4,075 4,050 Technology implementation 465 2,138 Tariff drawback adjustment (a) 1,113 — Acquisition costs — 47 Facility consolidation costs — 866 Stockholder cooperation agreement costs — 1,177 Other 468 — Non-GAAP Adjusted EBITDAS $ 9,769 $ 12,814 (a) During our fourth quarter of fiscal 2024, an incorrect submission was identified as a result of an audit of a tariff drawback claim that was submitted to US Customs Border Protection in fiscal 2022.
Cash generated in operating activities for fiscal 2023 was primarily impacted by $21.9 million of reduced inventory as a result of a planned reduction of inventory purchases during fiscal 2023 and a decrease in accounts receivable of $2.0 million as a result of lower sales volumes and timing of customer shipments.
Cash generated in operating activities for fiscal 2024 was primarily impacted by $6.4 million of reduced inventory because of sales of slower moving inventory items during the year and increased orders, $2.9 million higher accounts payable due to timing of vendor payments and inventory purchases, a $2.4 million increase in accrued payroll and incentives from higher management incentive accruals, and a decrease in accounts receivable of $1.2 million as a result of timing of customer shipments and a mix between traditional term customers and direct to consumer sales during our fourth fiscal quarter.
Recent Accounting Pronouncements The nature and impact of recent accounting pronouncements is discussed in Note 2 — Summary of Significant Accounting Policies to our consolidated and combined financial statements, which is incorporated herein by reference. 56 Contractual Obligations and Commercial Commitments The following table sets forth a summary of our material contractual obligations and commercial commitments as of April 30, 2023 (in thousands): Less Than More Than Total 1 Year 1-3 Years 3-5 Years 5 Years Long-term debt obligations $ 5,000 $ — $ — $ 5,000 $ — Interest on debt 1,563 399 798 366 — Operating lease obligations 37,541 2,251 4,419 4,445 26,426 Purchase obligations 35,691 35,691 — — — Total obligations $ 79,795 $ 38,341 $ 5,217 $ 9,811 $ 26,426 As of April 30, 2023, we had $5.0 million of borrowings outstanding on our revolving line of credit.
Contractual Obligations and Commercial Commitments The following table sets forth a summary of our material contractual obligations and commercial commitments as of April 30, 2024 (in thousands): Less Than More Than Total 1 Year 1-3 Years 3-5 Years 5 Years Interest on debt $ 280 $ 96 $ 184 $ — $ — Operating lease obligations 52,611 3,372 6,568 6,754 35,917 Purchase obligations 32,738 32,738 — — — Total obligations $ 85,629 $ 36,206 $ 6,752 $ 6,754 $ 35,917 As of April 30, 2024, we had no borrowings outstanding on our revolving line of credit.
We will continue to assess the adequacy of the valuation allowance on a quarterly basis.
We will continue to assess the adequacy of the valuation allowance on a quarterly basis. 55 Recent Accounting Pronouncements The nature and impact of recent accounting pronouncements is discussed in Note 2 — Summary of Significant Accounting Policies to our consolidated financial statements, which is incorporated herein by reference.
We expect to continue to utilize our cash flows to invest in our business, including research and development for new product initiatives; hiring additional employees; funding growth strategies, including any potential acquisitions; repaying our $5.0 million of borrowings under our revolving line of credit and any indebtedness we may incur over time; and repurchasing our common stock under our existing authorized repurchase programs. 53 The following table sets forth certain cash flow information for the fiscal years ended April 30, 2023 and 2022 (dollars in thousands): 2023 2022 $ Change % Change Operating activities $ 30,706 $ (17,953 ) $ 48,659 -271.0 % Investing activities (4,826 ) (33,588 ) 28,762 -85.6 % Financing activities (23,451 ) 10,261 (33,712 ) -328.5 % Total cash flow $ 2,429 $ (41,280 ) $ 43,709 -105.9 % Operating Activities Operating activities represent the principal source of our cash flow.
The following table sets forth certain cash flow information for the fiscal years ended April 30, 2024 and 2023 (dollars in thousands): 2024 2023 $ Change % Change Operating activities $ 24,491 $ 30,706 $ (6,215 ) -20.2 % Investing activities (5,976 ) (4,826 ) (1,150 ) 23.8 % Financing activities (10,767 ) (23,451 ) 12,684 -54.1 % Total cash flow $ 7,748 $ 2,429 $ 5,319 219.0 % 53 Operating Activities Operating activities represent the principal source of our cash flow.
Removed
In March 2022, we acquired substantially all of the assets of Grilla Grills, or Grilla, (including its branded products) from Fahrenheit Technologies, Inc., or FTI, for a purchase price of $27 million, subject to certain adjustments. Grilla is a provider of high-quality, barbecue grills; Wi-Fi-enabled wood pellet grills; smokers; accessories; and modular outdoor kitchens.
Added
Net sales in our traditional channels increased $12.8 million, or 12.3%, over the prior fiscal year. Traditional channel net sales for our shooting sports category increased primarily because of higher net sales of certain shooting accessories and selling slow moving personal protection products at a discount.
Removed
We fully integrated Grilla into our business during fiscal 2023. Results of operations for the fiscal year ended April 30, 2022 include activity for the period subsequent to the acquisition date of Grilla.
Added
Traditional channel net sales for our outdoor lifestyle category increased primarily as a result of higher net sales for hunting and fishing products. In addition, our traditional channel net sales increased because we began selling one of our outdoor lifestyle direct-to-consumer only brands at retail.
Removed
The net loss in the prior fiscal year included a $67.8 million non-cash goodwill impairment charge. • Non-GAAP Adjusted EBITDAS was $12.8 million, compared with $35.0 million for the prior fiscal year.
Added
Our international net sales increased $3.2 million, or 35.5%, over the prior fiscal year as a result of increased sales in Canada because of increased orders in the region as we focus on introducing more outdoor lifestyle products in Canada.
Removed
The lower net sales to our online retailers were partially offset by a 76.0% increase in our direct-to-consumer net sales over the prior year, primarily in our outdoor lifestyle products, which also include sales resulting from the acquisition of Grilla Grills.
Added
E-commerce channel net sales for our outdoor lifestyle category was relatively flat as compared to the prior fiscal year primarily from higher net sales for certain hunting and rugged outdoor products as a result of additional promotional activity, partially offset by lower net sales for our outdoor cooking products as a result of closing our retail location in Michigan in the first quarter of fiscal 2024 to consolidate operations into our Columbia, Missouri facility.
Removed
We believe the increase in our direct-to-consumer net sales represents the demand for our products in the market that are not typically hindered by retailer inventory management.
Added
Total direct-to-consumer net sales for the year ended April 30, 2024 were $29.1 million, or 34.6%, of total e-commerce net sales compared to $29.3 million, or 33.5%, of total e-commerce net sales for the year ended April 30, 2023.
Removed
Our brands that are only sold on our direct-to-consumer websites represented $24.4 million, or 28.0%, of fiscal 2023 total e-commerce channel net sales, which includes net sales from a business acquisition completed in the prior fiscal year.
Added
Research and development expenses increased $490,000, primarily from increased depreciation for new product tooling compared to the prior fiscal year. Selling, marketing, and distribution expenses increased $3.3 million from the prior fiscal year, primarily because of higher sales volume-related expenses, including higher freight costs, labor, and commissions.
Removed
Net sales in our traditional channels decreased $46.1 million, or 30.7%, from the prior fiscal year, primarily because of lower net sales for most of our products as a result of decreased orders from retailers, which we believe was caused by a combination of lower foot traffic because of less discretionary consumer spending and retailers’ efforts to reduce their overall inventory levels.
Added
We had no borrowings on our revolving line as of April 30, 2024.
Removed
In addition, lower net sales of our shooting sports products to our OEM customers resulted in lower traditional channel net sales from the prior fiscal year.
Added
The effective tax rates were 0.6% and 2.0% for fiscal 2024 and 2023, respectively.
Removed
We also believe the decrease in traditional channel net sales was a result of a build in traditional channel inventories of our products during the first fiscal quarter last year as certain customers accelerated their purchases to offset the possibility of delays caused by global supply chain disruptions.
Added
Non-GAAP Financial Measure We use GAAP net income as our primary financial measure.
Removed
We have a history of introducing over 200 new SKUs each year, the majority of which are introduced late in our third fiscal quarter. 50 Our order backlog as of April 30, 2023 was $7.0 million, or $3.3 million higher than at the end of fiscal 2022.
Added
We recorded an immaterial adjustment of $1.1 million resulting from this audit in fiscal 2024, when identified. We included this adjustment as a non-GAAP Adjusted EBITDAS adjustment because of the nonrecurring nature as well as the importance to promote comparability in our operating results. Liquidity and Capital Resources Historically, we have generated strong annual cash flow from operating activities.
Removed
Fiscal 2023 Cost of Sales and Gross Profit Compared with Fiscal 2022 Gross margin for fiscal 2023 decreased 10 basis points from the prior fiscal year, primarily because of lower sales volumes, product and customer mix, increased promotional product discounts that are consistent with pre-pandemic promotional discount levels, and increased expense related to provisions on inventory, partially offset by lower freight and tariff expenses from the planned reduction in inventory purchases and new product introductions that typically have higher gross margins.
Added
We expect to continue to utilize our cash flows to invest in our business, including research and development for new product initiatives; hiring additional employees; funding growth strategies, including any potential acquisitions; and repurchasing our common stock under our existing authorized repurchase programs.
Removed
Research and development expenses increased $860,000, primarily from increased consulting expenses; higher depreciation expense from new product tooling; and increased compensation-related expenses from additional headcount.
Added
The increase in cash used in investing activities is because of the lease assignment mentioned below as we now lease the entire facility at our Columbia, Missouri location and required additional racking and equipment in our warehouse.
Removed
Selling, marketing, and distribution expenses decreased $4.4 million, primarily because of lower sales volume-related expenses, lower advertising expenses, and reduced facility-related costs as a result of consolidating the Crimson Trace and Grilla operations into our headquarters in Columbia, Missouri.
Added
On January 31, 2023, we entered an Assignment Agreement with our former parent company and RCS – S&W Facility, LLC to assign to us the rights of the tenant under the Lease Agreement, dated October 26, 2017, as amended by the First Amendment of Lease Agreement, dated October 25, 2018, and as further amended by the Second Amendment to Lease Agreement, dated January 31, 2019 (collectively, the “Lease”), which assignment was effective on January 1, 2024.
Removed
Operating income decreased primarily because of lower sales volumes and gross profit mentioned above.
Added
The Lease covers approximately 632,000 square feet of building and surrounding property located at 1800 North Route Z, Columbia, Boone County, Missouri. We lease the entire building and the Lease provides us with an option to expand the Building by up to 491,000 additional square feet.
Removed
We borrowed $25.0 million in March 2022 to help fund the acquisition of Grilla Grills in the prior fiscal year. We had $5.0 million of borrowings on our revolving line as of April 30, 2023.
Added
The terms of the Lease are consistent with the sublease agreement that we formerly had with our former parent company. The Lease term ends on November 26, 2038 and, pursuant to the Assignment Agreement, does not provide for an extension of the term of the Lease.
Removed
The effective tax rates were 2.0% and (16.8%) for fiscal 2023 and 2022, respectively. Excluding the impact of the non-cash goodwill impairment charges and establishing the full valuation allowance against our deferred taxes, our effective tax rate for the fiscal year ended April 30, 2022 was 19.6%.
Added
We will receive tax and other incentives from federal, state, and local governmental authorities previously received by our former parent. Our former parent will guarantee the Lease through the end of the term. During fiscal year ended April 30, 2024, we recorded a right-of-use asset and lease liability of $10.6 million for the additional space provided under the Assignment Agreement.
Removed
Excluding our non-cash goodwill impairment charge and related income tax effect in fiscal 2022, we had net income of $9.9 million, or $0.71 per diluted share. The decrease in net income from the prior fiscal year was primarily because of lower sales volumes and gross profit. Non-GAAP Financial Measure We use GAAP net income as our primary financial measure.
Removed
We also use Adjusted EBITDAS to supplement GAAP measures of performance to evaluate our performance in connection with compensation decisions.
Removed
The cash generated in fiscal 2023 was partially offset by $1.3 million of reduced accounts payable due to timing of inventory shipments and $2.0 million of lower accrued payroll, incentives, and profit sharing primarily because of lower management incentive accruals.
Removed
Despite the expected increase in our first quarter of fiscal 2024, we expect our overall inventory balance to decline by the end of fiscal 2024 as compared to our inventory balance as of April 30, 2023.
Removed
We have incurred capital expenditures in fiscal 2023 and 2022 related to the development and implementation of our independent information technology infrastructure, including our new enterprise resource planning system, D365. We recorded spending of $2.0 million and $3.9 million of capital expenditures for fiscal 2023 and 2022, respectively, related to our development and implementation of our independent information technology infrastructure.
Removed
Credit Facility On August 24, 2020, we entered into a five-year financing arrangement consisting of a $50.0 million revolving line of credit secured by substantially all our assets, maturing five years from the start date, with available borrowings determined by a borrowing base calculation. The revolving line included an option to increase the credit commitment for an additional $15.0 million.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

14 edited+3 added−4 removed11 unchanged
Biggest change(b) Exhibits riIncorporated by Reference Exhibit Number Exhibit Form Exhibit Filing Date 2.1 Separation and Distribution Agreement, dated as of August 21, 2020, by and between Smith & Wesson Brands, Inc. and the Registrant 8-K 2.1 8/26/2020 3.1 Amended and Restated Certificate of Incorporation 8-K 3.1 8/26/2020 3.2 Second Amended and Restated Bylaws 8-K 3.2(a) 9/27/2021 4.2 Description of Securities 10-K 4.2 7/15/2021 10.1 * Transition Services Agreement, dated as of August 21, 2020, by and between Smith & Wesson Brands, Inc. and the Registrant 8-K 10.1 8/26/2020 10.2 * Tax Matters Agreement, dated as of August 21, 2020, by and between Smith & Wesson Brands, Inc. and the Registrant 8-K 10.2 8/26/2020 10.3 * Employee Matters Agreement, dated as of August 21, 2020, by and between Smith & Wesson Brands, Inc. and the Registrant 8-K 10.3 8/26/2020 10.4 * Trademark License Agreement, dated as of August 24, 2020, by and between Smith & Wesson Inc. and AOB Products Company, a wholly owned subsidiary of the Registrant 8-K 10.4 8/26/2020 10.5 * Sublease, dated as of August 24, 2020, by and between Smith & Wesson Sales Company and the Registrant 8-K 10.5 8/26/2020 10.6 * Assignment and Assumption of Lease Agreement, dated as of January 31, 2023, by and between Smith & Wesson Sales Company (f/k/a Smith & Wesson Corp.) and the Registrant, and consented to by Smith & Wesson Brands, Inc. 8-K 10.1 2/1/2023 10.7 * Lease Agreement, dated as of October 26, 2017, by and between Ryan Boone County, LLC and Smith & Wesson Corp. 8-K 10.2 2/1/2023 10.8 * First Amendment to Lease Agreement, dated October 25, 2018, by and among Ryan Boone County, LLC, Smith & Wesson Corp., and American Outdoor Brands Corporation 8-K 10.3 2/1/2023 10.9 * Second Amendment to Lease Agreement, dated as of January 31, 2019, by and among Ryan Boone County, LLC, American Outdoor Brands Sales Company (f/k/a Smith & Wesson Corp.), and American Outdoor Brands Corporation 8-K 10.4 2/1/2023 10.10 * Supply Agreement, dated as of August 24, 2020, by and between Crimson Trace Corporation, a wholly owned subsidiary of the Registrant, as Supplier, and Smith & Wesson Inc. 8-K 10.6 8/26/2020 10.11 * Supply Agreement, dated as of August 24, 2020, by and between AOB Products Company, a wholly owned subsidiary of the Registrant, as Supplier, and Smith & Wesson Inc. 8-K 10.7 8/26/2020 10.12 + 2020 Incentive Compensation Plan 8-K 10.8 8/26/2020 10.13 + Form of Non-Qualified Stock Option Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.9 8/26/2020 10.14 + Form of Restricted Stock Unit Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.10 8/26/2020 61 10.15 + Form of Performance Stock Unit Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.11 8/26/2020 10.16 + 2020 Employee Stock Purchase Plan 8-K 10.12 8/26/2020 10.17 + Employment Agreement by and between the Registrant and Brian D.
Biggest changeThe following Exhibits are hereby filed as part of this Annual Report on Form 10-K: Incorporated by Reference Exhibit Number Exhibit Form Exhibit Filing Date 3.1 Amended and Restated Certificate of Incorporation 8-K 3.1 8/26/2020 3.2 Third Amended and Restated Bylaws 8-K 3.2(a) 4/12/2024 4.2 # Description of Securities 10.1 * Amended and Restated Trademark License Agreement, dated as of April 11, 2024, by and between Smith & Wesson Inc. and AOB Products Company, a wholly owned subsidiary of the Registrant. 8-K 10.1 4/16/2024 10.2 * Trademark License Agreement, dated as of August 24, 2020, by and between Smith & Wesson Inc. and AOB Products Company, a wholly owned subsidiary of the Registrant. 8-K 10.2 4/16/2024 10.3 * Sublease, dated as of August 24, 2020, by and between Smith & Wesson Sales Company and the Registrant 8-K 10.5 8/26/2020 10.4 * Assignment and Assumption of Lease Agreement, dated as of January 31, 2023, by and between Smith & Wesson Sales Company (f/k/a Smith & Wesson Corp.) and the Registrant, and consented to by Smith & Wesson Brands, Inc. 8-K 10.1 2/1/2023 10.5 * Lease Agreement, dated as of October 26, 2017, by and between Ryan Boone County, LLC and Smith & Wesson Corp. 8-K 10.1 1/4/2024 10.6 * First Amendment to Lease Agreement, dated October 25, 2018, by and among Ryan Boone County, LLC, Smith & Wesson Corp., and American Outdoor Brands Corporation 8-K 10.2 1/4/2024 10.7 * Second Amendment to Lease Agreement, dated as of January 31, 2019, by and among Ryan Boone County, LLC, American Outdoor Brands Sales Company (f/k/a Smith & Wesson Corp.), and American Outdoor Brands Corporation 8-K 10.3 1/4/2024 10.8 + 2020 Incentive Compensation Plan 8-K 10.8 8/26/2020 10.9 + Form of Non-Qualified Stock Option Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.9 8/26/2020 10.10 + Form of Restricted Stock Unit Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.10 8/26/2020 10.11 + Form of Performance Stock Unit Award Grant Notice and Agreement to the 2020 Incentive Compensation Plan 8-K 10.11 8/26/2020 10.12 + 2020 Employee Stock Purchase Plan 8-K 10.12 8/26/2020 10.13 + Employment Agreement by and between the Registrant and Brian D.
Exhibits and Financial Statement Schedules (a) Financial Statements and Financial Statement Schedules (1) Consolidated and Combined Financial Statements are listed in the Index to Consolidated and Combined Financial Statements on page F-1 of this report.
Exhibits and Financial Statement Schedules (a) Financial Statements and Financial Statement Schedules (1) Consolidated Financial Statements are listed in the Index to Consolidated Financial Statements on page F-1 of this report.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2023 Annual Meeting of Stockholders. I tem 13.
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2024 Annual Meeting of Stockholders. I tem 13.
Certain Relationships and Related Transactions, and Director Independence The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2023 Annual Meeting of Stockholders. I tem 14.
Certain Relationships and Related Transactions, and Director Independence The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2024 Annual Meeting of Stockholders. I tem 14.
Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the 2013 framework established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Tradeway Commission (the COSO Framework). Based on that evaluation, management believes that our internal control over financial reporting was effective as of April 30, 2023.
Management conducted an evaluation of the effectiveness of our internal control over financial reporting based on the 2013 framework established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Tradeway Commission (the COSO Framework). Based on that evaluation, management believes that our internal control over financial reporting was effective as of April 30, 2024.
Directors, Executive Officers and Corporate Governance The information required by this Item relating to our directors and corporate governance is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2023 Annual Meeting of Stockholders.
Directors, Executive Officers and Corporate Governance The information required by this Item relating to our directors and corporate governance is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2024 Annual Meeting of Stockholders.
Executive Compensation The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2023 Annual Meeting of Stockholders. I tem 12.
Executive Compensation The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2024 Annual Meeting of Stockholders. I tem 12.
Murphy 8-K 10.13 8/26/2020 10.18 + Executive Severance Pay Plan 8-K 10.14 8/26/2020 10.19 Form of Indemnification Agreement entered into between the Registrant and the following directors and executive officers: As of August 24,2020 with Brian D. Murphy, H. Andrew Fulmer, Mary E. Gallagher, Gregory J. Gluchowski, Jr., Barry M. Monheit, and I.
Murphy 8-K 10.13 8/26/2020 10.14 + Executive Severance Pay Plan 8-K 10.14 8/26/2020 10.15 Form of Indemnification Agreement entered into between the Registrant and the following directors and executive officers: As of August 24,2020 with Brian D. Murphy, H. Andrew Fulmer, Mary E. Gallagher, Gregory J. Gluchowski, Jr., Barry M. Monheit, and I.
Principal Accountant Fees and Services The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2023 Annual Meeting of Stockholders. 60 P ART IV I tem 15.
Principal Accountant Fees and Services The information required by this Item is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2024 Annual Meeting of Stockholders. 58 P ART IV I tem 15.
As of April 30, 2023, we had $5.0 million of borrowings outstanding under the revolving line of credit. I tem 8. Financial Statements and Supplementary Data Reference is made to the financial statements, the notes thereto, and the report thereon, commencing on page F-1 of this report, which financial statements, notes, and report are incorporated herein by reference.
As of April 30, 2024, we had no borrowings outstanding under the revolving line of credit. I tem 8. Financial Statements and Supplementary Data Reference is made to the financial statements, the notes thereto, and the report thereon, commencing on page F-1 of this report, which financial statements, notes, and report are incorporated herein by reference. I tem 9.
Marie Wadecki 8-K 10.15 8/26/2020 10.20 Loan and Security Agreement, dated as of August 24, 2020, by and among AOB Products Company, Crimson Trace Corporation, American Outdoor Brands, Inc., Battenfeld Acquisition Company Inc., BTI Tools, LLC, Ultimate Survival Technologies, LLC, AOBC Asia Consulting, LLC, TD Bank, N.A., and the other banks, financial institutions, and other entities from time to time parties thereto 8-K 10.16 8/26/2020 10.21 Amendment No. 1 to Loan and Security Agreement, dated as of March 25, 2022, by and among AOB Products Company, Crimson Trace Corporation, American Outdoor Brands, Inc., Battenfeld Acquisition Company Inc., BTI Tools, LLC, Ultimate Survival Technologies, LLC, AOBC Asia Consulting, LLC, TD Bank, N.A., and the other banks, financial institutions, and other entities from time to time parties thereto 8-K 10.1 3/28/2022 10.22 Cooperation Agreement, dated August 7, 2022, by and among the Engine Group and the Registrant 8-K 10.1 8/8/2022 10.23 First Amendment to Cooperation Agreement, dated May 24, 2023, by and among the Engine Group and the Registrant 8-K 10.1 5/26/2023 21.1 # Subsidiaries of the Registrant 23.1 # Consent of Grant Thornton LLP, an Independent Registered Public Accounting Firm 31.1 # Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer 31.2 # Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer 32.1 ## Section 1350 Certification of Principal Executive Officer 32.2 ## Section 1350 Certification of Principal Financial Officer 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema Document 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) * Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
Marie Wadecki 8-K 10.15 8/26/2020 59 10.16 Loan and Security Agreement, dated as of August 24, 2020, by and among AOB Products Company, Crimson Trace Corporation, American Outdoor Brands, Inc., Battenfeld Acquisition Company Inc., BTI Tools, LLC, Ultimate Survival Technologies, LLC, AOBC Asia Consulting, LLC, TD Bank, N.A., and the other banks, financial institutions, and other entities from time to time parties thereto 8-K 10.16 8/26/2020 10.17 Amendment No. 1 to Loan and Security Agreement, dated as of March 25, 2022, by and among AOB Products Company, Crimson Trace Corporation, American Outdoor Brands, Inc., Battenfeld Acquisition Company Inc., BTI Tools, LLC, Ultimate Survival Technologies, LLC, AOBC Asia Consulting, LLC, TD Bank, N.A., and the other banks, financial institutions, and other entities from time to time parties thereto 8-K 10.1 3/28/2022 19.1 # Inside Information and Insider Trading Policy of American Outdoor Brands, Inc. 21.1 # Subsidiaries of the Registrant 23.1 # Consent of Grant Thornton LLP, an Independent Registered Public Accounting Firm 31.1 # Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer 31.2 # Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer 32.1 ## Section 1350 Certification of Principal Executive Officer 32.2 ## Section 1350 Certification of Principal Financial Officer 97.1 # Clawback Policy of American Outdoor Brands, Inc. 101.INS Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. 101.SCH Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) * Certain schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.
I tem 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable. I tem 9A.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. I tem 9A.
Controls and Procedures Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports we file or submit under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure. 57 Our management, under the supervision of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report on Form-10-K.
Controls and Procedures Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports we file or submit under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and 56 communicated to our management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Other than the change to our ERP system for one of our subsidiaries, there have been no changes in our internal control over financial reporting during our most recent fiscal quarter ended April 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. 58 I tem 9B. Other Information Not applicable.
Changes to Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting during our most recent fiscal quarter ended April 30, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. I tem 9B.
Removed
Changes to Internal Control over Financial Reporting During our most recent fiscal quarter ended April 30, 2023, we had a change in our internal control over financial reporting that occurred as a result of our implementation of a new ERP system, D365, for one of our subsidiaries that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Added
Our management, under the supervision of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report on Form-10-K.
Removed
The new ERP system for one of our subsidiaries replaced our legacy system in which a significant portion of our business transactions originate, are processed, and recorded. We have now transitioned all of our subsidiaries to D365.
Added
Other Information During the quarter ended April 30, 2024, no ne of our directors or officers adopted or terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement" (in each case, as defined in item 408 of Regulation S-K). Ite m 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 57 P ART III I tem 10.
Removed
D365 is intended to provide us with enhanced transactional processing and management tools compared with our legacy system and is intended to enhance internal controls over financial reporting. We believe D365 will facilitate better transactional reporting and oversight, enhance our internal control over financial reporting, and function as an important component of our disclosure controls and procedures.
Added
(2) All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission have been omitted because of the absence of the conditions under which they are required or because the information required is shown in the financial statements or notes above.
Removed
Ite m 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 59 P ART III I tem 10.

Other AOUT 10-K year-over-year comparisons