Smith & Wesson Announces Continued Steps to Focus Operations on Core Business
For Immediate Release - March 8, 2004
SPRINGFIELD, MA - Smith & Wesson Holding Corporation (AMEX:SWB), parent company of the legendary 152 year old Smith & Wesson Corp., announced today that it is continuing its strategy to shift its focus to concentrating on its core firearms business and related licensing opportunities. In addition to the Company closing its Scottsdale office and moving its corporate headquarters to Springfield, the Company is discontinuing its Crossing catalog business and is discontinuing its Smith & Wesson Advanced Technologies, or SWAT, division.
The closing of the Scottsdale office and the related staff reductions is expected to result in after-tax savings of approximately $1.3 million annually. Damian A. Larson, formerly the Company's Chief Financial Officer, Daniel A. Larson, formerly the Company's General Counsel, and Amy Armstrong, formerly the Company's Senior Vice President, Corporate Communications, will not be relocating to Springfield. Nine other positions in the corporate headquarters have been eliminated. The Company plans to take a one-time after-tax charge of approximately $500,000 in the third quarter of fiscal 2004 as a result of severance and other costs relating to the Scottsdale office closing. John A. Kelly, the Chief Financial Officer of Smith & Wesson Corp. since 1994, has assumed the additional position as Chief Financial Officer of the Company, and Ann B. Makkiya, Corporate Counsel of Smith & Wesson Corp., has assumed a similar position with the Company.
The Crossing catalog business generated an after-tax loss of approximately $600,000 through the third quarter of fiscal 2004. The Company is taking a one-time after-tax charge of approximately $100,000 in the third quarter for costs associated with the discontinuance of the operation.
The SWAT business generated an after-tax loss of approximately $300,000 in the fiscal year ended April 30, 2003 and an after-tax loss of approximately $600,000 through the third quarter of fiscal 2004. The Company plans to take a one-time after-tax charge of approximately $100,000 in the third quarter of fiscal 2004 for severance costs related to the four employees of the SWAT division. The Company currently is negotiating the sale of certain business operations and assets related to the division.
"These efforts further support our action plan to acutely focus on the core business and continue to grow that business on a robust basis," said Roy Cuny, President and CEO of Smith & Wesson Holding Corporation. "We continue to invest in the core business, introduce new and exciting products for handgun enthusiasts, and provide exceptional customer service as we aggressively add value to the market."
The Company has just returned from SHOT (Shooting, Hunting and Outdoors Trade) Show the annual industry showcase of offerings for the shooting industry. Mr. Cuny added, "we introduced a number of exciting new products at the recent SHOT Show. These offerings include product line extensions in the 1911 category, the S&W 500 Magnum Series, additional Ultra Light Scandium frame revolvers and other production additions as well. We are thrilled by the very favorable reaction to these products, which we believe will further support our increasing sales."
About Smith & Wesson Holding Corporation
Smith & Wesson Holding Corporation is the parent company of Smith & Wesson Corp., one of the world's leading producers of quality handguns, law enforcement products and firearm safety and security products. Law enforcement personnel, military personnel, target shooters, hunters, collectors and firearms enthusiasts throughout the world have used the Company's products with confidence for more than 152 years. Smith & Wesson Corp. also manufacturers and markets Smith & Wesson branded handcuffs and other products utilizing its metal working expertise. For more information, visit www.smith-wesson.com