Tuesday, 19 March 2024
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Fox Factory Holding Corp reports sales surge in Q3

Fox Factory has reported its financial results for the third quarter ending October 2nd, during which the business posted a sales increase of 23.4% to $260.7 million, compared to $211.3 million in the same period last fiscal year.

This increase in sales reflects a 17.7% increase in Powered Vehicles Group sales, and a 32.4% increase in Specialty Sports Group sales.

In the year-to-date the firm has generated $628.2 million, up 11.2% when compared against the same window in 2019. The cycling arm (Speciality Sports) leads the charge, up 14.8% against the powersports division at 8.8%.

Mike Dennison, Fox’s Chief Executive Officer said: “Our record third quarter results demonstrate not only the success of our superior products but also the phenomenal resilience and execution by our entire global team. With swift allocation of resources, we were able to take advantage of the strong demand trends within our end markets, while still driving gross margin improvement amid an uncertain and complex manufacturing environment”

“The FOX brand is resonating with consumers who are seeking innovative products with high performance and industry defining capabilities, which is evident in the exceptional 32% revenue growth of our Specialty Sports Group. FOX’s premium brand positioning is a key differentiator for OEM partners and aftermarket enthusiasts, and our Powered Vehicles Group is the beneficiary of our long heritage as an industry pioneer. Based on the strength of our year-to-date results and our expectation for momentum to continue through the fourth quarter, we are pleased to reinitiate annual guidance for 2020,” he added.

The firm now expects to finish the year with a fourth quarter generating in the region of $240 to $250 million and non-GAAP adjusted earnings per diluted share in the range of $0.72 to $0.80.

Additionally, the Q3 report shows the company’s gross margin was 34.3% for the third quarter, a 130-basis point increase from gross margin of 33.0% in the same period last year.

Net income attributable to stockholders had risen to $38.0 million, compared to $29.5 million in the third quarter of 2019 and the earnings per diluted share were $0.90, compared to earnings per diluted share of $0.75 last year.

The report also showed that Fox’s Non-GAAP adjusted net income was $45.4 million compared to adjusted net income of $32.7 million of last year. In addition to this, the group’s adjusted EBITDA in the third quarter was $60.1 million, whereas this only reached $43.6 million in Q3 2019.

Fox expects its Q4 sales to be in the range of $240.0 million to $250.0 million and non-GAAP adjusted earnings per diluted share in the range of $0.72 to $0.80.

As of October 2, 2020, the Company had cash and cash equivalents of $278.2 million compared to $43.7 million as of January 3, 2020. The cash balance reflects $198.2 million from the Company’s June 2020 common stock offering of 2.8 million shares.

Total debt was $389.2 million, compared to $68.0 million as of January 3, 2020. The increase is primarily due to borrowings to fund the acquisition of SCA in the first quarter of fiscal 2020.