March 05, 2018
Net income slipped 27% to $8,444,000 from $11,610,000 in the final quarter hurt by lower product margins, on sales that were up 2% to $127,771,000 from $125,764,000. Included in the results was a $5.5 million net-of-taxes non-cash asset impairment charge for the Octane Fitness trade name offset by a $5.6 million benefit from a deferred tax asset reassessment due to the new tax law.
Hedge fund Starboard Value LP nominated two additional directors to its full slate that it proposes should replace the Newell board, and reiterated its contempt for the company’s current management.
Gun control chatter following the Parkland school shooting, which occurred halfway through the month, seems to have jolted consumers who had been lulled into complacency after the 2016 election.
President Trump’s decision to impose 25% tariffs on steel and 10% on aluminum is likely to draw a response from U.S. trading partners, but unless a trade war escalates to the point where a broad sanction against Chinese imports becomes a possibility, it’s unlikely to affect sporting goods directly.
The retailer has received additional financing that will add $6 million in financing this month and a minimum of $3 million more by the end of the month, which enabled it to satisfy Comvest and seek court approval to terminate the auction process that might have resulted in liquidating the chain.