10-Q 1 clar-20220331x10q.htm FORM 10-Q clar-20220331x10q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended: March 31, 2022

or

¨ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _________ to _________

Commission File Number: 001-34767

CLARUS CORPORATION

(Exact name of registrant as specified in its charter)

Delaware

58-1972600

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification Number)

2084 East 3900 South

Salt Lake City, Utah

84124

(Address of principal executive offices)

(Zip code)

(801) 278-5552

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $.0001 per share

CLAR

NASDAQ Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes  x No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  x No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

¨

Non-accelerated filer

¨

Accelerated filer

x

Smaller reporting company

¨

Emerging growth company

¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of May 4, 2022, there were 37,224,109 shares of common stock, par value $0.0001, outstanding.


 

INDEX

CLARUS CORPORATION

PART I

FINANCIAL INFORMATION

Page

Item 1.

Financial Statements (Unaudited)

Condensed Consolidated Balance Sheets – March 31, 2022 and December 31, 2021

3

Condensed Consolidated Statements of Comprehensive Income – Three months ended March 31, 2022 and 2021

4

Condensed Consolidated Statements of Cash Flows – Three months ended March 31, 2022 and 2021

5

Condensed Consolidated Statements of Stockholders’ Equity – Three months ended March 31, 2022 and 2021

6

Notes to Condensed Consolidated Financial Statements

7

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

23

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

31

Item 4.

Controls and Procedures

31

PART II

OTHER INFORMATION

Item 1.

Legal Proceedings

32

Item 1A.

Risk Factors

32

Item 6.

Exhibits

33

Signature Page

34

 

 

 

2


 

 

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

 

  

CLARUS CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands, except per share amounts)

March 31, 2022

December 31, 2021

Assets

Current assets

Cash

$

16,451

$

19,465

Accounts receivable, less allowance for

credit losses of $1,283 and $811

69,530

66,180

Inventories

152,718

129,354

Prepaid and other current assets

12,838

11,831

Income tax receivable

258

116

Total current assets

251,795

226,946

Property and equipment, net

43,168

42,826

Other intangible assets, net

71,327

73,683

Indefinite-lived intangible assets

131,115

128,271

Goodwill

121,064

118,090

Deferred income taxes

22,456

22,433

Other long-term assets

20,157

19,578

Total assets

$

661,082

$

631,827

Liabilities and Stockholders' Equity

Current liabilities

Accounts payable

$

34,098

$

31,488

Accrued liabilities

30,176

27,473

Income tax payable

1,844

4,437

Current portion of long-term debt

12,103

9,585

Total current liabilities

78,221

72,983

Long-term debt, net

139,829

131,948

Deferred income taxes

36,892

35,280

Other long-term liabilities

23,034

21,448

Total liabilities

277,976

261,659

Stockholders' Equity

Preferred stock, $0.0001 par value per share; 5,000

shares authorized; none issued

-

-

Common stock, $0.0001 par value per share; 100,000 shares authorized;

41,272 and 41,105 issued and 37,210 and 37,094 outstanding, respectively

4

4

Additional paid in capital

666,489

662,996

Accumulated deficit

(258,963)

(263,342)

Treasury stock, at cost

(25,537)

(24,440)

Accumulated other comprehensive income (loss)

1,113

(5,050)

Total stockholders' equity

383,106

370,168

Total liabilities and stockholders' equity

$

661,082

$

631,827

See accompanying notes to condensed consolidated financial statements.

 


 

3


 

 

 

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands, except per share amounts)

Three Months Ended

March 31, 2022

March 31, 2021

Sales

Domestic sales

$

62,307

$

47,573

International sales

50,969

27,758

Total sales

113,276

75,331

Cost of goods sold

69,024

48,281

Gross profit

44,252

27,050

Operating expenses

Selling, general and administrative

34,175

20,885

Transaction costs

1,201

476

Contingent consideration expense

763

-

Total operating expenses

36,139

21,361

Operating income

8,113

5,689

Other expense

Interest expense, net

(1,116)

(238)

Other, net

(67)

(140)

Total other expense, net

(1,183)

(378)

Income before income tax

6,930

5,311

Income tax expense (benefit)

1,621

(366)

Net income

5,309

5,677

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustment

6,077

(1,016)

Unrealized gain on hedging activities

86

896

Other comprehensive income (loss)

6,163

(120)

Comprehensive income

$

11,472

$

5,557

Net income per share:

Basic

$

0.14

$

0.18

Diluted

0.13

0.17

Weighted average shares outstanding:

Basic

37,161

31,283

Diluted

39,802

32,750

See accompanying notes to condensed consolidated financial statements.

 

 

4


 

 

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

Three Months Ended

March 31, 2022

March 31, 2021

Cash Flows From Operating Activities:

Net income

$

5,309

$

5,677

Adjustments to reconcile net income to net cash used in operating activities:

Depreciation of property and equipment

1,832

1,356

Amortization of other intangible assets

4,120

1,197

Amortization of debt issuance costs

170

82

Loss on disposition of property and equipment

9

-

Noncash lease expense

694

331

Contingent consideration expense

754

-

Stock-based compensation

3,367

1,524

Deferred income taxes

524

(697)

Changes in operating assets and liabilities:

Accounts receivable

437

66

Inventories

(23,137)

(2,388)

Prepaid and other assets

(856)

(5,730)

Accounts payable

(2,101)

(3,224)

Accrued liabilities

820

(1,229)

Income taxes

(2,737)

517

Net cash used in operating activities

(10,795)

(2,518)

Cash Flows From Investing Activities:

Purchases of property and equipment

(1,900)

(1,347)

Net cash used in investing activities

(1,900)

(1,347)

Cash Flows From Financing Activities:

Proceeds from revolving credit facilities

25,670

11,637

Repayments on revolving credit facilities

(13,689)

(16,565)

Repayments on term loans

(1,613)

(1,000)

Purchase of treasury stock

(1,097)

(651)

Proceeds from exercise of stock options

126

166

Cash dividends paid

(930)

(783)

Net cash provided by (used in) financing activities

8,467

(7,196)

Effect of foreign exchange rates on cash

1,214

(203)

Change in cash

(3,014)

(11,264)

Cash, beginning of year

19,465

17,789

Cash, end of period

$

16,451

$

6,525

Supplemental Disclosure of Cash Flow Information:

Cash paid for income taxes

$

3,844

$

75

Cash paid for interest

$

926

$

161

Supplemental Disclosures of Non-Cash Investing and Financing Activities:

Property and equipment purchased with accounts payable

$

425

$

293

Lease liabilities arising from obtaining right of use assets

$

1,164

$

3,539

See accompanying notes to condensed consolidated financial statements.


 

5


 

 

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

(In thousands, except per share amounts)

Accumulated

Additional

Other

Total

Common Stock

Paid-In

Accumulated

Treasury Stock

Comprehensive

Stockholders'

Shares

Amount

Capital

Deficit

Shares

Amount

Income (Loss)

Equity

Balance, December 31, 2020

35,198

$

4

$

513,979

$

(286,100)

(3,970)

$

(23,789)

$

500

$

204,594

Net income

-

-

-

5,677

-

-

-

5,677

Other comprehensive loss

-

-

-

-

-

-

(120)

(120)

Cash dividends ($0.025 per share)

-

-

-

(783)

-

-

-

(783)

Purchase of treasury stock

-

-

-

-

(41)

(651)

-

(651)

Stock-based compensation expense

-

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