Randy wont like this
03-18-2010, 10:21 AM
#1
Banned
Thread Starter
Join Date: Dec 2008
Location: Boncarbo,Colorado
Posts: 9,186
Randy wont like this
NOTES FROM CONFERENCE CALL
Now let me turn to our sales in the firearms market. Sales into our consumer or sporting-goods channel were down by about 18% overall in the quarter.
Our Rochester, New Hampshire facility again deliver improved performance in the quarter. Sales of Thompson/Center products increased approximately 5%. We can attribute most of this to the success of two relatively new products at Thompson/Center, the Venture bolt-action rifle and the Bone Collector muzzleloader. These new products helped to drive growth in our Thompson/Center business. Moreover, improved performance at the factory level, including cost containment and process improvements, helped translate that growth into profitability.
You have heard me say before that Smith & Wesson and Thompson/Center are innovators in the industry. Nowhere is that more evident than when we appear at the SHOT show each year and unveil our new product offerings.
SHOT occurred in January of this year and we maintained the tradition of introducing our customers to some innovative and exciting new products. At this year’s show we launched a total of four major platforms and 43 product line extensions. Highlights included Thompson/Center’s new HotShot youth rifle, and the new Impact muzzleloader, which delivers high accuracy and a competitive price point.
These exciting products are helping to expand our Thompson/Center product portfolio into new categories, and continue the transition of Thompson/Center from a niche muzzleloading company to a full line of hunting rifles and accessories.
Thompson/Center Arms revenue increased year-over-year by 4.5%. Third-quarter results reflect growth in our black powder sales, which achieved a 6.4% increase over the prior year. In addition, sales of Thompson/Center branded bolt action rifles help to offset sales of the discontinued Smith & Wesson branded hunting rifles that occurred during Q3 of last year.
During fiscal 2009, we determined that the goodwill and long-lived assets related to our acquisition of Thompson/Center Arms were impaired due to severe economic and market conditions that appeared to be continuing and other factors. Based on this determination under applicable accounting standards, we recorded an impairment charge of $98,243,000, less related deferred tax liabilities of $21,766,000, yielding a $76,477,000 adverse impact to after-tax profits.
LAW SUITS
Jeremy McCutchen v. Thompson/Center Arms Company, Inc., et al., in the District Court of Harris County, Texas. The complaint, filed on December 21, 2009, asserts claims based on theories of strict liability, breach of warranty, negligence, and failure to warn. The plaintiff seeks unspecified money damages. The plaintiff claims to have been using a Thompson/Center Arms rifle on December 22, 2007 when the firearm allegedly malfunctioned causing injury to the plaintiff. Thompson/Center Arms filed an answer to plaintiff’s complaint on January 29, 2010 denying all allegations of liability. Discovery is ongoing. Trial has not yet been scheduled.
Steve and Michelle Santoyo v. Bear Lake Holdings, Inc., d/b/a Thompson/Center Arms, et al., in the Circuit Court of Boone County, Missouri. The complaint, filed on or about February 11, 2010, asserts claims based on theories of strict liability, negligence, failure to warn, negligently supplying a dangerous instrumentality, loss of consortium, and punitive damages. The plaintiffs seek unspecified money damages. Plaintiff Steve Santoyo claims to have been using a Thompson/Center Arms Black Diamond muzzleloader on November 28, 2008, when the firearm allegedly malfunctioned causing injury to him. Our response to the complaint is due on April 1, 2010. Trial has not yet been scheduled.
Jesse James and Kay James v. Thompson/Center Arms Company, Inc., et. al., in the 151st Judicial District for Harris County, Texas. On October 28, 2009, this case was settled within the limits of our self-insured retention.
Brian Ward v. Thompson/Center Arms Company, Inc., et. al., in the Forty-Sixth Circuit Court for Otsego County, Michigan. The complaint was filed on October 16, 2006 and alleges that plaintiff sustained eye injuries using a Thompson/Center Arms rifle. Plaintiff asserts product liability claims against both Thompson/Center Arms and the retailer based on negligence and warranty principles.
Now let me turn to our sales in the firearms market. Sales into our consumer or sporting-goods channel were down by about 18% overall in the quarter.
Our Rochester, New Hampshire facility again deliver improved performance in the quarter. Sales of Thompson/Center products increased approximately 5%. We can attribute most of this to the success of two relatively new products at Thompson/Center, the Venture bolt-action rifle and the Bone Collector muzzleloader. These new products helped to drive growth in our Thompson/Center business. Moreover, improved performance at the factory level, including cost containment and process improvements, helped translate that growth into profitability.
You have heard me say before that Smith & Wesson and Thompson/Center are innovators in the industry. Nowhere is that more evident than when we appear at the SHOT show each year and unveil our new product offerings.
SHOT occurred in January of this year and we maintained the tradition of introducing our customers to some innovative and exciting new products. At this year’s show we launched a total of four major platforms and 43 product line extensions. Highlights included Thompson/Center’s new HotShot youth rifle, and the new Impact muzzleloader, which delivers high accuracy and a competitive price point.
These exciting products are helping to expand our Thompson/Center product portfolio into new categories, and continue the transition of Thompson/Center from a niche muzzleloading company to a full line of hunting rifles and accessories.
Thompson/Center Arms revenue increased year-over-year by 4.5%. Third-quarter results reflect growth in our black powder sales, which achieved a 6.4% increase over the prior year. In addition, sales of Thompson/Center branded bolt action rifles help to offset sales of the discontinued Smith & Wesson branded hunting rifles that occurred during Q3 of last year.
During fiscal 2009, we determined that the goodwill and long-lived assets related to our acquisition of Thompson/Center Arms were impaired due to severe economic and market conditions that appeared to be continuing and other factors. Based on this determination under applicable accounting standards, we recorded an impairment charge of $98,243,000, less related deferred tax liabilities of $21,766,000, yielding a $76,477,000 adverse impact to after-tax profits.
LAW SUITS
Jeremy McCutchen v. Thompson/Center Arms Company, Inc., et al., in the District Court of Harris County, Texas. The complaint, filed on December 21, 2009, asserts claims based on theories of strict liability, breach of warranty, negligence, and failure to warn. The plaintiff seeks unspecified money damages. The plaintiff claims to have been using a Thompson/Center Arms rifle on December 22, 2007 when the firearm allegedly malfunctioned causing injury to the plaintiff. Thompson/Center Arms filed an answer to plaintiff’s complaint on January 29, 2010 denying all allegations of liability. Discovery is ongoing. Trial has not yet been scheduled.
Steve and Michelle Santoyo v. Bear Lake Holdings, Inc., d/b/a Thompson/Center Arms, et al., in the Circuit Court of Boone County, Missouri. The complaint, filed on or about February 11, 2010, asserts claims based on theories of strict liability, negligence, failure to warn, negligently supplying a dangerous instrumentality, loss of consortium, and punitive damages. The plaintiffs seek unspecified money damages. Plaintiff Steve Santoyo claims to have been using a Thompson/Center Arms Black Diamond muzzleloader on November 28, 2008, when the firearm allegedly malfunctioned causing injury to him. Our response to the complaint is due on April 1, 2010. Trial has not yet been scheduled.
Jesse James and Kay James v. Thompson/Center Arms Company, Inc., et. al., in the 151st Judicial District for Harris County, Texas. On October 28, 2009, this case was settled within the limits of our self-insured retention.
Brian Ward v. Thompson/Center Arms Company, Inc., et. al., in the Forty-Sixth Circuit Court for Otsego County, Michigan. The complaint was filed on October 16, 2006 and alleges that plaintiff sustained eye injuries using a Thompson/Center Arms rifle. Plaintiff asserts product liability claims against both Thompson/Center Arms and the retailer based on negligence and warranty principles.
03-18-2010, 10:24 AM
#2
Banned
Thread Starter
Join Date: Dec 2008
Location: Boncarbo,Colorado
Posts: 9,186
The plaintiff is seeking an unspecified amount of compensatory damages. On November 15, 2006, Thompson/Center Arms filed an answer denying all allegations of liability. On February 2, 2009, the plaintiff filed a second amended complaint. On February 17, 2009, we filed our answer to plaintiff’s complaint. On October 9, 2009, we filed a motion for summary judgment. On October 21, 2009, plaintiff opposed our motion. A hearing on our motion for summary judgment was held on November 3, 2009. No decision has been issued to date. Expert discovery is ongoing. A case evaluation as required by the Michigan court was held on November 13, 2009, in which the panel recommended a settlement in favor of the plaintiff in the amount of $325,000. We rejected this proposed settlement award. On December 12, 2009, the court granted our motion for summary judgment on the manufacturing defect, failure to recall, and failure to test claims, and denied our motion on the design defect claims under the theories of risk-utility and failure to warn. A settlement conference is scheduled for August 5, 2010. Trial is scheduled to begin October 19, 2010
On January 19, 2010, the U.S. Department of Justice (“DOJ”) unsealed indictments of 22 individuals from the firearm industry, one of whom was our Vice President Sales, International & U.S. Law Enforcement. We were not charged in the indictment. On January 22, 2010, we were served with a Grand Jury subpoena for the production of documents. We have always taken, and continue to take seriously, our obligation as an industry leader to foster a responsible and ethical culture, which includes adherence to laws and industry regulations in the United States and abroad. Although we are cooperating fully with the DOJ in this matter, the DOJ may determine that we have violated FCPA laws. We cannot predict when this investigation will be completed or its outcome. If the DOJ determines that we violated FCPA laws, we may face sanctions, including monetary penalties and administrative relief. In addition, we are incurring legal costs for our company as well as for our employee.
%
On January 19, 2010, the U.S. Department of Justice (“DOJ”) unsealed indictments of 22 individuals from the firearm industry, one of whom was our Vice President Sales, International & U.S. Law Enforcement. We were not charged in the indictment. On January 22, 2010, we were served with a Grand Jury subpoena for the production of documents. We have always taken, and continue to take seriously, our obligation as an industry leader to foster a responsible and ethical culture, which includes adherence to laws and industry regulations in the United States and abroad. Although we are cooperating fully with the DOJ in this matter, the DOJ may determine that we have violated FCPA laws. We cannot predict when this investigation will be completed or its outcome. If the DOJ determines that we violated FCPA laws, we may face sanctions, including monetary penalties and administrative relief. In addition, we are incurring legal costs for our company as well as for our employee.
%
03-18-2010, 10:25 AM
#3
Banned
Thread Starter
Join Date: Dec 2008
Location: Boncarbo,Colorado
Posts: 9,186
On January 19, 2010, the U.S. Department of Justice (“DOJ”) unsealed indictments of 22 individuals from the firearm industry, one of whom was our Vice President Sales, International & U.S. Law Enforcement. We were not charged in the indictment. On January 22, 2010, we were served with a Grand Jury subpoena for the production of documents. We have always taken, and continue to take seriously, our obligation as an industry leader to foster a responsible and ethical culture, which includes adherence to laws and industry regulations in the United States and abroad. Although we are cooperating fully with the DOJ in this matter, the DOJ may determine that we have violated FCPA laws. We cannot predict when this investigation will be completed or its outcome. If the DOJ determines that we violated FCPA laws, we may face sanctions, including monetary penalties and administrative relief. In addition, we are incurring legal costs for our company as well as for our employee.
03-18-2010, 10:44 AM
#5
Fork Horn
Join Date: Jan 2010
Location: Burton, Mi.
Posts: 146
It looks like Thompson Center has some questions to answer regarding quality issues. I hope that it is a case of operator error. Has any info been given out wich rifel(s) are suspect? Any pictures been made available?
03-18-2010, 12:42 PM
#7
Dominant Buck
Join Date: Feb 2003
Location: Wisconsin
Posts: 21,193
I own a Black Diamond and I just can not think of how that rifle could not be safe. These kind of law suits are company killers. And I am sure that Randy may not care less. Its not Savage that is on the line here.
