Vista Outdoor, the company that recently purchased the Remington ammunition plant in Lonoke, said Thursday that integration of the Arkansas operation into its larger business is ahead of schedule and that it is hiring and training workers as quickly as possible to meet ammunition demand across the country.
During a third-quarter earnings conference call, Chris Metz, chief executive officer of Vista Outdoor, said the company had done a remarkable job bringing Remington into the fold, noting the operation had to be brought up from essentially a cold start.
Jason Vanderbrink, president of ammunition for Vista Outdoor, said the Lonoke operation is exceeding expectations and is hiring and training hundreds of workers and retraining those brought back from furlough.
The Lonoke operation now has nearly 800 workers, a company spokesman said Thursday, nearly doubling its worker count from November. He said the company is continuing to hire and and train new workers to meet demand while being mindful of social distancing and other coronavirus precautions at the plant.
Vista Outdoor was formed in 2015 when the sporting group of Alliant Techsystems Inc. was spun off. The company includes outdoor brands including optics and ammunition makers. It has 14 other manufacturing operations in the U.S. and Puerto Rico.
In mid-October, Vista Outdoor, based in Minnesota, closed on its acquisition of Remington's ammunition production facility, along with the Remington brand and trademarks. Vista Outdoor paid $81.4 million for the assets as part of Remington's bankruptcy.
Metz said high consumer demand for ammunition has left retail shelves bare and hunters and shooters scrambling to find products in stores and online. In November, he said the company had a year's worth of orders valued at $1 billion on the books. He declined to give further details on the company's backlog during Thursday's call.
In December and January, Vanderbrink took to YouTube, addressing what he called misinformation about the ammunition shortage, disputing claims the company was not making ammunition; that it was stockpiling ammo in secret warehouses; and only selling ammunition to certain customers. He said the company is doing everything possible to meet consumer demand.
"But I wanted to address those rumors because every day I hear something new and it's simply not true," he said in a Dec. 19 video that had 1.9 million views as of Thursday.
Background checks of firearms buyers in 2020 shattered old records with 39.69 million, a 40% increase over 2019's old record of 28.37 million. While the FBI background-check figures don't represent the number of guns sold, they are generally used as indicators of firearms demand. Background-check numbers in January this year also set new highs with 4.3 million checks, up 59% from 2020's record of 2.7 million.
Metz said Thursday that the surge in demand has been different from those in the past, which are typically based on political concerns. He said demand in March seemed to be initially stirred by people at home in a pandemic lockdown wanting to get outdoors, quickly followed by concerns of civil unrest, an unexpected hunting demand and then, most recently, political and legislative concerns with a new administration in the White House.
Metz called the demand in the market the broadest he's ever seen, with ammunition buyers scooping up everything from pistol rounds to shotgun shells. He pointed to 2020's estimated 8 million new gun owners and the 1 million new hunters as a market the company wants to capture and continue to serve.
In an earlier interview with the Arkansas Democrat-Gazette, Metz said that for years the ammunition segment of Remington had been neglected by the company in favor of its firearms segment. In addition to Remington, Vista Outdoor provides ammunition to consumers, law enforcement agencies and the military through brands including Federal Premium, Speer and CCI.
In July, Remington Outdoor Co., the nation's oldest gun-maker, declared bankruptcy in U.S. Bankruptcy Court for the Northern District of Alabama, its second bankruptcy in two years, even with ammunition and firearms sales at record highs across the nation. The private company was founded in 1816. Remington began production at the Lonoke facility in 1969. The operation includes 750,000 square feet of manufacturing space on 1,200 acres.
For its third quarter for fiscal 2021, which ends at the end of March, Vista Outdoor reported revenue of $575 million, up 35% when compared with the same quarter in the last fiscal year. Earnings per share for the quarter that ended Dec. 27 were $1.31, compared with 25 cents for the third quarter of fiscal 2020. The company reported adjusted earnings per share was $1.03, compared with 21 cents for the year ago-quarter.
In the shooting sports segment, the company said sales were up 41% to $402 million when compared with the same quarter last year. The company's outlook for its fourth quarter projected sales of $510 million to $530 million with earnings per share of 55 cents to 65 cents.
Shares of Vista Outdoor closed at $31.46 a share, up 5 cents or less than 1% in trading Thursday on the New York Stock Exchange. Shares have traded as low as $4.29 and as high as $33.47 over the past year.