Outdoor Holding Company - 8.75% Series A Cumulative Redeemable Perpetual Preferred Stock Q1 FY2025 earnings call

• Jared Smith thanked employees for their work in the company's transformation. They are focusing on transforming the ammunition plant to higher margin rifle and pistol production and the Marketplace to an eCommerce leader. - GunBroker increased take rate by ~40 basis points to 6.2% in Q1 through various means and expects further increase with gear fire financing and cross-selling. - Ammunition division is laser-focused on increasing rifle production, pulling back on low margin products, and working on streamlining operations. - Paul Kasowski mentioned identifying $15M in cost-cutting opportunities. - Rob Wiley discussed Q1 financials, including revenues, costs, margins, non-recurring expenses, adjusted EBITDA, and share repurchases.

In the first quarter of fiscal 2025, total revenues were approximately $31 million. The Ammunition segment contributed $18.7 million, while the Marketplace segment generated $12.3 million. Cost of revenues was $21.2 million for the quarter, with the Ammunition segment having a cost of revenues of $19.4 million and the Marketplace segment $1.8 million. The total gross margin was $9.8 million (31.6%), with the Marketplace segment having a gross margin of $10.5 million (85.6%) and the Ammunition segment having a negative gross margin of $0.7 million (negative 4%).

• Expect steady progress in rifle case production. - GunBroker's take rate expected to increase further with gear fire financing and cross-selling. - Focus on streamlining manufacturing processes to improve product throughput and marginality. - Enhancements for GunBroker, like flexible financing and cross-selling solution, to drive sales growth.

• Macroeconomic environment impacting the industry leading to decreased activity in segments. - Production inefficiencies in the Ammunition segment affecting margins. - Risks related to forward-looking statements where actual results may differ materially.

Q: How should we expect casing revenues to ramp up and gross margins for the Ammunition segment?

A: Jared Smith said they expect steady progress with rifle case production and anticipate positive inflection in Ammunition segment gross margins in future periods if production trends continue.

Q: Observations on firearms in shooting sports consumer and trends in AOV or financing attach rates?

A: Jared Smith mentioned a slight uptick in NICS for July, anticipating it to hold through the election period but noted he's not a fortune teller on election impact on NICS.

Q: GunBroker sales decline and competition with brick-and-mortar?

A: Jared Smith said GunBroker competes in the premium space, owns the used market, and sees potential with cross-selling in the cart.

Q: Cross-selling progress and early signs of success?

A: Jared Smith said cross-selling functionality came on in the last 25 days, and as algorithms improve, they expect to promote products with greater margins and grow the business through better accessorizing before checkout.

Q: Ammo plant operations updates?

A: Jared Smith mentioned delivery of an annealing oven that will start up in late August/early September, steady progress in rifle production with firm deliveries scheduled, and some mechanical issues but ongoing progress in Q2 and Q3