clar-20210630x10q

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: June 30, 2021

¨ 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)

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

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

As of July 28, 2021, there were 33,800,052 shares of common stock, par value $0.0001, outstanding.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS


CLARUS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except per share amounts)

	June 30, 2021		December 31, 2020
Assets
Current assets
Cash	$	6,782	$	17,789
Accounts receivable, less allowance for credit losses and
doubtful accounts of $651 and $1,433, respectively		51,235		50,475
Inventories		82,656		68,356
Prepaid and other current assets		13,123		5,385
Income tax receivable		254		117
Total current assets		154,050		142,122

Property and equipment, net		27,495		26,956
Other intangible assets, net		16,963		19,416
Indefinite-lived intangible assets		47,415		47,523
Goodwill		26,715		26,715
Deferred income taxes		11,342		11,113
Other long-term assets		10,229		6,846
Total assets	$	294,209	$	280,691

Liabilities and Stockholders' Equity
Current liabilities
Accounts payable and accrued liabilities	$	42,167	$	34,665
Income tax payable		1,201		956
Current portion of long-term debt		5,010		4,000
Total current liabilities		48,378		39,621

Long-term debt		22,112		30,621
Deferred income taxes		1,215		1,227
Other long-term liabilities		7,324		4,628
Total liabilities		79,029		76,097

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;
35,496 and 35,198 issued and 31,485 and 31,228 outstanding, respectively		4		4
Additional paid in capital		518,981		513,979
Accumulated deficit		(280,148)		(286,100)
Treasury stock, at cost		(24,440)		(23,789)
Accumulated other comprehensive income		783		500
Total stockholders' equity		215,180		204,594
Total liabilities and stockholders' equity	$	294,209	$	280,691

See accompanying notes to condensed consolidated financial statements.

‎


CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(In thousands, except per share amounts)

	Three Months Ended
	June 30, 2021		June 30, 2020

Sales
Domestic sales	$	51,876	$	20,259
International sales		21,433		9,755
Total sales		73,309		30,014

Cost of goods sold		45,288		19,378
Gross profit		28,021		10,636

Operating expenses
Selling, general and administrative		20,704		14,493
Transaction costs		649		180

Total operating expenses		21,353		14,673

Operating income (loss)		6,668		(4,037)

Other (expense) income
Interest expense, net		(212)		(257)
Other, net		(4,461)		406

Total other (expense) income, net		(4,673)		149

Income (loss) before income tax		1,995		(3,888)
Income tax expense (benefit)		155		(1,145)
Net income (loss)		1,840		(2,743)

Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment		295		367
Unrealized gain (loss) on hedging activities		108		(549)
Other comprehensive income (loss)		403		(182)
Comprehensive income (loss)	$	2,243	$	(2,925)

Net income (loss) per share:
Basic	$	0.06	$	(0.09)
Diluted		0.06		(0.09)

Weighted average shares outstanding:
Basic		31,367		29,817
Diluted		33,190		29,817

See accompanying notes to condensed consolidated financial statements.

‎


CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(In thousands, except per share amounts)

	Six Months Ended
	June 30, 2021		June 30, 2020

Sales
Domestic sales	$	99,449	$	48,807
International sales		49,191		34,762
Total sales		148,640		83,569

Cost of goods sold		93,569		54,421
Gross profit		55,071		29,148

Operating expenses
Selling, general and administrative		41,589		31,863
Transaction costs		1,125		430

Total operating expenses		42,714		32,293

Operating income (loss)		12,357		(3,145)

Other expense
Interest expense, net		(450)		(568)
Other, net		(4,601)		(125)

Total other expense, net		(5,051)		(693)

Income (loss) before income tax		7,306		(3,838)
Income tax benefit		(211)		(1,131)
Net income (loss)		7,517		(2,707)

Other comprehensive income, net of tax:
Foreign currency translation adjustment		(721)		(34)
Unrealized gain on hedging activities		1,004		264
Other comprehensive income		283		230
Comprehensive income (loss)	$	7,800	$	(2,477)

Net income (loss) per share:
Basic	$	0.24	$	(0.09)
Diluted		0.23		(0.09)

Weighted average shares outstanding:
Basic		31,325		29,789
Diluted		32,970		29,789

See accompanying notes to condensed consolidated financial statements.

‎


CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)

		Six Months Ended
		June 30, 2021		June 30, 2020
	Cash Flows From Operating Activities:
	Net income (loss)	$	7,517	$	(2,707)
	Adjustments to reconcile net income (loss) to net cash provided by operating activities:
	Depreciation of property and equipment		2,705		2,265
	Amortization of other intangible assets		2,394		1,537
	Amortization of debt issuance costs		162		154
	Gain on disposition of property and equipment		(8)		(1)
	Noncash lease expense		698		364
	Stock-based compensation		3,350		1,229
	Deferred income taxes		(710)		(1,081)
	Changes in operating assets and liabilities:
	Accounts receivable		(1,243)		17,662
	Inventories		(14,874)		969
	Prepaid and other assets		(6,575)		(149)
	Accounts payable and accrued liabilities		6,809		(5,569)
	Income taxes		137		(231)
	Net cash provided by operating activities		362		14,442

	Cash Flows From Investing Activities:
	Proceeds from disposition of property and equipment		25		3
	Purchases of property and equipment		(3,225)		(2,021)
	Net cash used in investing activities		(3,200)		(2,018)

	Cash Flows From Financing Activities:
	Proceeds from revolving credit facilities		15,217		21,089
	Repayments on revolving credit facilities		(20,684)		(33,264)
	Repayments on term note		(2,000)		-
	Proceeds from issuance of term note		-		20,000
	Payment of debt issuance costs		-		(44)
	Purchase of treasury stock		(651)		(137)
	Proceeds from exercise of stock options		1,652		497
	Cash dividends paid		(1,565)		(744)
	Net cash (used in) provided by financing activities		(8,031)		7,397

	Effect of foreign exchange rates on cash		(138)		14

	Change in cash		(11,007)		19,835
	Cash, beginning of year		17,789		1,703
	Cash, end of period	$	6,782	$	21,538

	Supplemental Disclosure of Cash Flow Information:
	Cash paid for income taxes	$	353	$	266
	Cash paid for interest	$	309	$	478
	Supplemental Disclosures of Non-Cash Investing and Financing Activities:
	Property and equipment purchased with accounts payable	$	236	$	456
	Lease liabilities arising from obtaining right of use assets	$	3,933	$	80
	Unpaid debt issuance costs	$	217	$	-
	Stock dividends	$	-	$	714

See accompanying notes to condensed consolidated financial statements.

‎


PART I	FINANCIAL INFORMATION	Page
Item 1.	Financial Statements (Unaudited)

	Condensed Consolidated Balance Sheets – June 30, 2021 and December 31, 2020	3
	Condensed Consolidated Statements of Comprehensive Income (Loss) – Three months ended June 30, 2021 and 2020	4
	Condensed Consolidated Statements of Comprehensive Income (Loss) – Six months ended June 30, 2021 and 2020	5
	Condensed Consolidated Statements of Cash Flows – Six months ended June 30, 2021 and 2020	6
	Condensed Consolidated Statements of Stockholders’ Equity – Three and six months ended June 30, 2021 and 2020	7
	Notes to Condensed Consolidated Financial Statements	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32
Item 4.	Controls and Procedures	32

PART II	OTHER INFORMATION

Item 1.	Legal Proceedings	34
Item 1A.	Risk Factors	34
Item 6.	Exhibits	35
Signature Page		36