Johnson Outdoors Inc., a leading global outdoor recreation company, today announced it is consolidating operations for its paddle sport brands in Old Town, Maine by the end of September 2009 as part of a comprehensive effort to improve profitability of its Watercraft business unit. The decision will result in the closure of the Company’s plant in Ferndale, Washington and a reduction of about 90 positions located there.
Consolidation is anticipated to result in annual cost-savings of more than $4 million dollars beginning in fiscal 2010. Costs and charges associated with the action are estimated to have a negative impact onearnings per diluted share of between $0.16 and $0.20 in the fourth fiscal quarter of 2009.
“Our focus is on transforming Watercraft into a stronger, more competitive and cash-generating business which is better positioned for growth in the future. I am confident we are doing what is right to drive marketplace success for our brands, improve profitability for Watercraft and Johnson Outdoors long-term, and by doing so, enhance hareholder value,” said Helen Johnson-Leipold, Chairman and Chief Executive Officer. “We are grateful for the support of Governor Baldacci and the City of Old Town enabling us to continue our 100-plus year tradition of quality boat production in Maine.”
Watercraft transformation began in March 2009 when the Company merged leadership of its Watercraft and Marine Electronics business units under a single Group Vice President. In May 2009, brand sales for the two businesses were combined and Watercraft marketing was restructured to simplify and streamline customer communication. As a result of the action announced today, all Watercraft ,production and related business support and customer service functions will be fully integrated andoperating at Old Town before the end of December 2009. The Company will be providing severance and other support to employees whose positions have been eliminated as a result of today’s announcement.
Old Town was selected as the Watercraft hub of operations due to its depth of manufacturing capability and capacity for efficient expansion. The Company currently maintains two sites in Old Town, Maine, but will transfer all operations into one location after conversion of its modern distribution and warehouse center is finished later this year. The site has been redesigned for maximum production efficiency, while reducing energy use by 50 percent. An estimated additional 48 jobs will be created in Old Town once consolidation is completed.
The Company’s century-old mill site will be vacated and future-use options are under evaluation.
ABOUT JOHNSON OUTDOORS INC.
JOHNSON OUTDOORS is a leading global outdoor recreation company that turns ideas into adventure with innovative, top-quality products. The company designs, manufactures and markets a portfolio of winning, consumer-preferred brands across four categories: Watercraft, Marine Electronics, Diving and Outdoor Equipment. Johnson Outdoors’ familiar brands include, among others: Old Town(r) canoes and kayaks; Ocean Kayak and Necky(r) kayaks; Lendal(r) paddles; Carlisle(r) and Extrasport(r) paddling accessories; Minn Kota(r) motors; Cannon(r) downriggers; Humminbird(r) fishfinders; Geonav(r)chartplotters; SCUBAPRO(r) UWATEC(r) and Seemann(r) dive equipment; Silva(r) compasses; Tech4O(r) digital instruments; and Eureka!(r) tents.
SAFE HARBOR STATEMENT
Certain matters discussed in this press release are “forward-looking statements,” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995.Statements other than statements of historical fact are considered forward-looking statements. These statements may be identified by the use of forward-looking words or phrases such as “anticipate,””believe,” “could,” “expect,” “intend,” “may,” “planned,” “potential,” “should,” “will,” “would” or the negative of those terms or other words of similar meaning. Such forward-looking statements are subject to certain risks and uncertainties, which could cause actual results or outcomes to differ materially from those currently anticipated. Factors that could affect actual results or outcomes include changes in consumer spending patterns; the Company’s success in implementing its strategic plan, including its focus on innovation; actions of and disputes with companies that compete with the Company; the Company’s success in managing inventory; the risk that the lenders may be unwilling to provide a waiver or amendment if the Company is in violation of its financial covenants and the cost to the Company of obtaining any waiver or amendment that the lenders would be willing to provide; risk of future write-downs of goodwill or other intangible assets; movements in foreign currencies or interest rates; the Company’s success in restructuring of its Watercraft operations; the success of suppliers and customers; the ability of the Company to deploy its capital successfully; adverse weather conditions; and other risks and uncertainties identified in the Company’s filings with the Securities and Exchange Commission. Shareholders, potential investors and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included herein are only made as of the date of this press release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
