10-Q

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: March 31, 2023

or

¨ 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)

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

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

As of April 26, 2023, there were 37,190,302 shares of common stock, par value $0.0001, outstanding.

INDEX

CLARUS CORPORATION

PART I	FINANCIAL INFORMATION	Page
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Balance Sheets – March 31, 2023 and December 31, 2022	3
	Condensed Consolidated Statements of Comprehensive Income – Three months ended March 31, 2023 and 2022	4
	Condensed Consolidated Statements of Cash Flows – Three months ended March 31, 2023 and 2022	5
	Condensed Consolidated Statements of Stockholders’ Equity – Three months ended March 31, 2023 and 2022	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	29
Item 4.	Controls and Procedures	29
PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	30
Item 1A.	Risk Factors	30
Item 6.	Exhibits	31
Signature Page		32

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CLARUS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except per share amounts)
	March 31, 2023		December 31, 2022
Assets
Current assets
Cash	$	10,310	$	12,061
Accounts receivable, less allowance for
credit losses of $1,437 and $1,211		68,230		66,553
Inventories		145,756		147,072
Prepaid and other current assets		9,845		9,899
Income tax receivable		3,209		3,034
Total current assets		237,350		238,619
Property and equipment, net		42,197		43,010
Other intangible assets, net		51,482		55,255
Indefinite-lived intangible assets		82,444		82,901
Goodwill		62,704		62,993
Deferred income taxes		18,168		17,912
Other long-term assets		20,414		17,455
Total assets	$	514,759	$	518,145
Liabilities and Stockholders' Equity
Current liabilities
Accounts payable	$	25,252	$	27,052
Accrued liabilities		22,125		25,170
Income tax payable		684		421
Current portion of long-term debt		12,562		11,952
Total current liabilities		60,623		64,595
Long-term debt, net		124,444		127,082
Deferred income taxes		18,226		18,506
Other long-term liabilities		18,574		15,854
Total liabilities		221,867		226,037
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;
41,791 and 41,637 issued and 37,190 and 37,048 outstanding, respectively		4		4
Additional paid in capital		680,673		679,339
Accumulated deficit		(336,175)		(336,843)
Treasury stock, at cost		(32,825)		(32,707)
Accumulated other comprehensive loss		(18,785)		(17,685)
Total stockholders' equity		292,892		292,108
Total liabilities and stockholders' equity	$	514,759	$	518,145
See accompanying notes to condensed consolidated financial statements.

‎

3

CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(In thousands, except per share amounts)
	Three Months Ended
	March 31, 2023		March 31, 2022
Sales
Domestic sales	$	44,916	$	62,307
International sales		52,468		50,969
Total sales		97,384		113,276
Cost of goods sold		61,363		69,024
Gross profit		36,021		44,252
Operating expenses
Selling, general and administrative		32,819		34,175
Transaction costs		74		1,201
Contingent consideration (benefit) expense		(1,565)		763
Total operating expenses		31,328		36,139
Operating income		4,693		8,113
Other income (expense)
Interest expense, net		(2,746)		(1,116)
Other, net		85		(67)
Total other expense, net		(2,661)		(1,183)
Income before income tax		2,032		6,930
Income tax expense		434		1,621
Net income		1,598		5,309
Other comprehensive (loss) income, net of tax:
Foreign currency translation adjustment		(1,021)		6,077
Unrealized (loss) gain on hedging activities		(79)		86
Other comprehensive (loss) income		(1,100)		6,163
Comprehensive income	$	498	$	11,472
Net income per share:
Basic	$	0.04	$	0.14
Diluted		0.04		0.13
Weighted average shares outstanding:
Basic		37,137		37,161
Diluted		38,109		39,802
See accompanying notes to condensed consolidated financial statements.

‎

4

CLARUS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
		Three Months Ended
		March 31, 2023		March 31, 2022
	Cash Flows From Operating Activities:
	Net income	$	1,598	$	5,309
	Adjustments to reconcile net income to net cash provided by (used in) operating activities:
	Depreciation of property and equipment		1,791		1,832
	Amortization of other intangible assets		3,276		4,120
	Amortization of debt issuance costs		232		170
	Loss on disposition of property and equipment		5		9
	Noncash lease expense		690		694
	Contingent consideration (benefit) expense		(1,565)		754
	Stock-based compensation		1,334		3,367
	Deferred income taxes		(105)		524
	Changes in operating assets and liabilities:
	Accounts receivable		(2,797)		437
	Inventories		1,341		(23,137)
	Prepaid and other assets		(153)		(856)
	Accounts payable		90		(2,101)
	Accrued liabilities		(2,612)		820
	Income taxes		74		(2,737)
	Net cash provided by (used in) operating activities		3,199		(10,795)
	Cash Flows From Investing Activities:
	Proceeds from disposition of property and equipment		88		-
	Purchases of property and equipment		(1,471)		(1,900)
	Net cash used in investing activities		(1,383)		(1,900)
	Cash Flows From Financing Activities:
	Proceeds from revolving credit facilities		11,731		25,670
	Repayments on revolving credit facilities		(12,153)		(13,689)
	Repayments on term loans		(1,668)		(1,613)
	Purchase of treasury stock		(118)		(1,097)
	Proceeds from exercise of options		-		126
	Cash dividends paid		(930)		(930)
	Net cash (used in) provided by financing activities		(3,138)		8,467
	Effect of foreign exchange rates on cash		(429)		1,214
	Change in cash		(1,751)		(3,014)
	Cash, beginning of year		12,061		19,465
	Cash, end of period	$	10,310	$	16,451
	Supplemental Disclosure of Cash Flow Information:
	Cash paid for income taxes	$	350	$	3,844
	Cash paid for interest	$	2,586	$	926
	Supplemental Disclosures of Non-Cash Investing and Financing Activities:
	Property and equipment purchased with accounts payable	$	202	$	425
	Lease liabilities arising from obtaining right of use assets	$	3,941	$	1,164
See accompanying notes to condensed consolidated financial statements.

‎

5

CLARUS CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(Unaudited)

(In thousands, except per share amounts)

													Accumulated
					Additional								Other		Total
	Common Stock				Paid-In		Accumulated		Treasury Stock				Comprehensive		Stockholders'
	Shares		Amount		Capital		Deficit		Shares		Amount		Income (Loss)		Equity
Balance, December 31, 2021		41,105	$	4	$	662,996	$	(263,342)		(4,011)	$	(24,440)	$	(5,050)	$	370,168
Net income		-		-		-		5,309		-		-		-		5,309
Other comprehensive income		-		-		-		-		-		-		6,163		6,163
Cash dividends ($0.025 per share)		-		-		-		(930)		-		-		-		(930)
Purchase of treasury stock		-		-		-		-		(51)		(1,097)		-		(1,097)
Stock-based compensation expense		-		-		3,367		-		-		-		-		3,367
Proceeds from exercise of options		167		-		126		-		-		-		-		126
Balance, March 31, 2022		41,272	$	4	$	666,489	$	(258,963)		(4,062)	$	(25,537)	$	1,113	$	383,106
													Accumulated
					Additional								Other		Total
	Common Stock				Paid-In		Accumulated		Treasury Stock				Comprehensive		Stockholders'
	Shares		Amount		Capital		Deficit		Shares		Amount		Loss		Equity
Balance, December 31, 2022		41,637	$	4	$	679,339	$	(336,843)		(4,589)	$	(32,707)	$	(17,685)	$	292,108
Net income		-		-		-		1,598		-		-		-		1,598
Other comprehensive loss		-		-		-		-		-		-		(1,100)		(1,100)
Cash dividends ($0.025 per share)		-		-		-		(930)		-		-		-		(930)
Purchase of treasury stock		-		-		-		-		(12)		(118)		-		(118)
Stock-based compensation expense		-		-		1,334		-		-		-		-		1,334
Proceeds from exercise of options		154		-		-		-		-		-		-		-
Balance, March 31, 2023		41,791	$	4	$	680,673	$	(336,175)		(4,601)	$	(32,825)	$	(18,785)	$	292,892
See accompanying notes to condensed consolidated financial statements.

6

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(in thousands, except per share amounts)

NOTE 1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited condensed consolidated financial statements of Clarus Corporation and subsidiaries (which may be referred to as the “Company,” “Clarus,” “we,” “us” or “our”) as of March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), instructions to the Quarterly Report on Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments, except otherwise disclosed) necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. The results for the three months ended March 31, 2023 are not necessarily indicative of the results to be obtained for the year ending December 31, 2023. These interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on February 27, 2023.

Nature of Business

Headquartered in Salt Lake City, Utah, we are a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor and consumer enthusiast markets. Our mission is to identify, acquire and grow outdoor “super fan” brands through our unique “innovate and accelerate” strategy. We define a “super fan” brand as a brand that creates the world’s pre-eminent, performance-defining product that the best-in-class user cannot live without. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Sierra®, Barnes®, Rhino-Rack® and MAXTRAX® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The more significant estimates relate to the fair value of net assets acquired in business combinations, excess or obsolete inventory, allowance for credit losses, contingent consideration liabilities, and valuation of deferred tax assets, long-lived assets, goodwill and indefinite-lived intangible assets, and other intangible assets. We base our estimates on historical experience, projected future cash flows, and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

NOTE 2. INVENTORIES

Inventories, as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Finished goods	$	107,152	$	107,453
Work-in-process		9,822		8,719
Raw materials and supplies		28,782		30,900
	$	145,756	$	147,072

7

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 3. PROPERTY AND EQUIPMENT

Property and equipment, net, as of March 31, 2023, and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Land	$	4,160	$	4,160
Building and improvements		17,369		17,357
Furniture and fixtures		7,355		7,384
Computer hardware and software		8,615		8,498
Machinery and equipment		37,701		37,054
Construction in progress		5,165		5,028
		80,365		79,481
Less accumulated depreciation		(38,168)		(36,471)
	$	42,197	$	43,010

Depreciation expense for the three months ended March 31, 2023 and 2022 was $1,791 and $1,832, respectively.

NOTE 4. GOODWILL AND INTANGIBLE ASSETS

Goodwill

The following table summarizes the balances in goodwill by segment:

	Outdoor		Precision Sport		Adventure		Total
Goodwill	$	29,507	$	26,715	$	88,349	$	144,571
Accumulated goodwill impairment losses		(29,507)		-		(52,071)		(81,578)
Balance at December 31, 2022		-		26,715		36,278		62,993
Impact of foreign currency exchange rates		-		-		(289)		(289)
Balance at March 31, 2023	$	-	$	26,715	$	35,989	$	62,704

Indefinite-Lived Intangible Assets

The following table summarizes the changes in indefinite-lived intangible assets:

Balance at December 31, 2022	$	82,901
Impact of foreign currency exchange rates		(457)
Balance at March 31, 2023	$	82,444

8

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

Trademarks classified as indefinite-lived intangible assets by brand as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Black Diamond	$	19,600	$	19,600
PIEPS		3,036		2,986
Sierra		18,900		18,900
Barnes		5,600		5,600
Rhino-Rack		25,379		25,744
MAXTRAX		9,929		10,071
	$	82,444	$	82,901

Other Intangible Assets, net

The following table summarizes the changes in gross other intangible assets:

Gross balance at December 31, 2022	$	100,889
Impact of foreign currency exchange rates		(697)
Gross balance at March 31, 2023	$	100,192

Other intangible assets, net of amortization as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Intangibles subject to amortization
Customer relationships	$	76,852	$	(36,924)	$	39,928		13.8 years
Product technologies		21,130		(9,974)		11,156		10.2 years
Tradename / trademark		1,263		(865)		398		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,192	$	(48,710)	$	51,482		13.0 years
	December 31, 2022
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Customer relationships	$	77,370	$	(34,653)	$	42,717		13.8 years
Product technologies		21,309		(9,207)		12,102		10.2 years
Tradename / trademark		1,263		(827)		436		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,889	$	(45,634)	$	55,255		13.0 years

9

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

Amortization expense for the three months ended March 31, 2023 and 2022, was $3,276 and $4,120, respectively. Future amortization expense for other intangible assets as of March 31, 2023 is as follows:

Years Ending December 31,	Amortization Expense
2023 (excluding the three months ended March 31, 2023)	$	9,427
2024		10,654
2025		8,622
2026		6,619
2027		4,837
2028		3,451
Thereafter		7,872
	$	51,482

NOTE 5. ACCRUED LIABILITIES AND OTHER LONG-TERM LIABILITIES

Accrued liabilities as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Accrued payroll and related items	$	4,626	$	5,363
Accrued bonus		1,581		1,006
Designated forward exchange contracts		207		-
Accrued warranty		1,371		1,465
Current lease liabilities		3,231		2,836
Accrued commissions		733		343
Contingent consideration liabilities		-		1,595
Accrued excise tax		764		977
Other		9,612		11,585
	$	22,125	$	25,170

Other long-term liabilities as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Long-term lease liability	$	15,629	$	12,825
Deferred stock consideration for business acquisition		2,096		2,127
Other		849		902
	$	18,574	$	15,854

10

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 6. LONG-TERM DEBT

Long-term debt as of March 31, 2023 and December 31, 2022, was as follows:

	March 31, 2023		December 31, 2022
Revolving credit facility (a)	$	18,538	$	18,049
Other debt (b)		126		1,134
Term loan (c)		118,750		120,311
Debt issuance costs		(408)		(460)
		137,006		139,034
Less current portion		(12,562)		(11,952)
	$	124,444	$	127,082

On April 18, 2022 (the “Effective Date”), the Company and certain of its direct and indirect subsidiaries entered into an Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent and the lenders party thereto (the “Restated Credit Agreement”).

The Restated Credit Agreement provides for borrowings of up to $300,000 under a secured revolving credit facility (the “Revolving Loans”) (including up to $5,000 for letters of credit), and borrowings of up to $125,000 under a secured term loan facility (the “Term Loans”). The Restated Credit Agreement also permits the Company, subject to certain requirements, to arrange with lenders for an aggregate of up to $175,000 of additional revolving and/or term loan commitments (both of which are currently uncommitted), for potential aggregate revolving and term loan commitments under the Restated Credit Agreement of up to $600,000. The Restated Credit Agreement matures on April 18, 2027 (the “Maturity Date”), at which time the revolving commitments thereunder will terminate and all outstanding Revolving Loans and Term Loans, together with all accrued and unpaid interest thereon, must be repaid.

All obligations under the Restated Credit Agreement are secured by our subsidiary equity interests, as well as accounts receivable, inventory, intellectual property and certain other assets owned by the Company. The Restated Credit Agreement contains restrictions on the Company’s ability to pay dividends or make distributions or other restricted payments if certain conditions in the Restated Credit Agreement are not fulfilled. The Restated Credit Agreement also includes other customary affirmative and negative covenants, including financial covenants relating to the Company’s consolidated total leverage ratio and fixed charge coverage ratio. The Company was in compliance with the debt covenants set forth in the Credit Agreement as of March 31, 2023.

(a)As of March 31, 2023, the Company had drawn $18,538 on the revolving loan, with a maturity date of April 18, 2027. Approximately $61,000 in additional funds were available to borrow on the revolving loan at March 31, 2023, while maintaining compliance with the consolidated total leverage ratio per the Restated Credit Agreement of 3.75 to 1. The Company pays interest monthly on any borrowings on the Restated Credit Agreement. As of March 31, 2023 and December 31, 2022, the rates were approximately 6.8% and 6.3%, respectively.

(b)Foreign subsidiaries of the Company have a revolving credit facility and term debt with financial institutions which mature between April 26, 2023 and August 8, 2024. The foreign subsidiaries pay interest monthly on any borrowings on the credit facilities as well as monthly payments on the term debt. As of March 31, 2023, the interest rates ranged between approximately 3.2% and 4.0% and as of December 31, 2022, the interest rates ranged between approximately 1.3% and 4.0%. The credit facilities are secured by certain assets of the foreign subsidiaries. The revolving credit facility was settled and closed as of March 31, 2023 and had no amounts outstanding.

(c)The Company is required to repay the term loan through quarterly payments of $1,563 each beginning with June 30, 2022, increasing to $3,125 each beginning with June 30, 2023, and any remaining obligations will be repaid in full on the maturity date of the Restated Credit Agreement of April 18, 2027. The Company pays interest monthly on any borrowings on the Restated Credit Agreement. As of March 31, 2023 and December 31, 2022, the rates were approximately 6.8% and 6.3%, respectively.

11

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS

The Company’s primary exchange rate risk management objective is to mitigate the uncertainty of anticipated cash flows attributable to changes in foreign currency exchange rates. The Company primarily focuses on mitigating changes in cash flows resulting from sales denominated in currencies other than the U.S. dollar. The Company manages this risk primarily by using currency forward and option contracts. If the anticipated transactions are deemed probable, the resulting relationships are formally designated as cash flow hedges. The Company accounts for these contracts as cash flow hedges and tests effectiveness by determining whether changes in the expected cash flow of the derivative offset, within a range, changes in the expected cash flow of the hedged item.

At March 31, 2023, the Company’s derivative contracts had remaining maturities of less than one year. The counterparties to these transactions had both long-term and short-term investment grade credit ratings. The maximum net exposure of the Company’s credit risk to the counterparties is generally limited to the aggregate unrealized loss of $207 on all contracts as March 31, 2023. The Company’s exposure of counterparty credit risk is limited to the aggregate unrealized gain of all contracts with that counterparty. At March 31, 2023, there was no such exposure to the counterparties. The Company’s derivative counterparties have strong credit ratings and as a result, the Company does not require collateral to facilitate transactions.

The Company held the following contracts designated as hedging instruments as of March 31, 2023 and December 31, 2022:

	March 31, 2023
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Euros	€ 20,871	February 2024

	December 31, 2022
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Canadian Dollars	$2,807	February 2023
Foreign exchange contracts - Euros	€ 20,760	February 2024

For contracts that qualify as effective hedge instruments, the effective portion of gains and losses resulting from changes in fair value of the instruments are included in accumulated other comprehensive loss and reclassified to sales in the period the underlying hedged transaction is recognized in earnings. Gains (losses) of $(16) and $253 were reclassified to sales during the three months ended March 31, 2023 and 2022, respectively.

The following table presents the balance sheet classification and fair value of derivative instruments as of March 31, 2023 and December 31, 2022:

	Classification	March 31, 2023		December 31, 2022
Derivative instruments in asset positions:
Designated forward exchange contracts	Prepaid and other current assets	$	-	$	357
Derivative instruments in liability positions:
Designated forward exchange contracts	Accrued liabilities	$	207	$	-
Designated forward exchange contracts	Other long-term liabilities	$	-	$	6

12

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 8. ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss (“AOCI”) primarily consists of foreign currency translation adjustments and changes in our forward foreign exchange contracts. The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2023:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2022	$	(17,628)	$	(57)	$	(17,685)
Other comprehensive loss before reclassifications		(1,021)		(91)		(1,112)
Amounts reclassified from other comprehensive loss		-		12		12
Net current period other comprehensive loss		(1,021)		(79)		(1,100)
Balance as of March 31, 2023	$	(18,649)	$	(136)	$	(18,785)

The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2022:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2021	$	(5,241)	$	191	$	(5,050)
Other comprehensive income before reclassifications		6,077		280		6,357
Amounts reclassified from other comprehensive income		-		(194)		(194)
Net current period other comprehensive income		6,077		86		6,163
Balance as of March 31, 2022	$	836	$	277	$	1,113

The effects on net income of amounts reclassified from unrealized gains (losses) on cash flow hedges for foreign exchange contracts for the three months ended March 31, 2023 and 2022, were as follows:

	Gains (losses) reclassified from AOCI to the Consolidated Statements of Comprehensive Income
Affected line item in the Consolidated	Three Months Ended
Statements of Comprehensive Income	March 31, 2023		March 31, 2022
Foreign exchange contracts:
Sales	$	(16)	$	253
Less: Income tax (benefit) expense		(4)		59
Amount reclassified, net of tax	$	(12)	$	194
Total reclassifications from AOCI	$	(12)	$	194

13

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 9. FAIR VALUE MEASUREMENTS

We measure certain financial assets and liabilities at fair value on a recurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

Level 1 - inputs to the valuation methodology are quoted market prices for identical assets or liabilities in active markets.

Level 2 - inputs to the valuation methodology include quoted prices in markets that are not active or model inputs that are

observable either directly or indirectly for substantially the full term of the asset or liability.

Level 3 - inputs to the valuation methodology are based on prices or valuation techniques that are unobservable.

Items Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis at March 31, 2023 and December 31, 2022 were as follows:

	March 31, 2023
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	-	$	-	$	-
	$	-	$	-	$	-	$	-
Liabilities
Designated forward exchange contracts	$	-	$	207	$	-	$	207
	$	-	$	207	$	-	$	207
	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	357	$	-	$	357
	$	-	$	357	$	-	$	357
Liabilities
Designated forward exchange contracts	$	-	$	6	$	-	$	6
Contingent consideration liabilities	$	-	$	-	$	1,595	$	1,595
	$	-	$	6	$	1,595	$	1,601

Derivative financial instruments are recorded at fair value based on current market pricing models. No nonrecurring fair value measurements existed at March 31, 2023 and December 31, 2022.  

The Company estimated the initial fair value of the contingent consideration liabilities primarily using a series of call options. Significant unobservable inputs used in the valuation included discount rates ranging from 4.8% to 8.0%. Contingent consideration liabilities are subsequently remeasured at the estimated fair value at the end of each reporting period using financial projections of the acquired company, such as sales-based milestones and estimated probabilities of achievement, with the change in fair value recognized in contingent consideration benefit in the accompanying consolidated statements of comprehensive income for such period. We measure the initial liability and remeasure the liability on a recurring basis using Level 3 inputs as defined under authoritative guidance for fair value measurements.

14

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

The following table summarizes the changes in contingent consideration liabilities:

	MAXTRAX
Balance at December 31, 2022	$	1,595
Fair value adjustments		(1,565)
Contingent consideration payments		-
Impact of foreign currency exchange rates		(30)
Balance at March 31, 2023	$	-

As the contingent consideration liabilities are remeasured to fair value each reporting period, significant increases or decreases in projected sales, discount rates or the time until payment is made could have resulted in a significantly lower or higher fair value measurement. Our determination of fair value of the contingent consideration liabilities could change in future periods based on our ongoing evaluation of these significant unobservable inputs. As of March 31, 2023, the net sales threshold required for the payment of the MAXTRAX contingent consideration is not expected to be met during the measurement period ended June 30, 2023.

NOTE 10. STOCKHOLDERS’ EQUITY

On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend program of $0.025 per share of the Company’s common stock (the “Quarterly Cash Dividend”) or $0.10 per share on an annualized basis. The declaration and payment of future Quarterly Cash Dividends is subject to the discretion of and approval of the Company’s Board of Directors. On April 28, 2023, the Company announced that its Board of Directors approved the payment on May 19, 2023 of the Quarterly Cash Dividend of $0.025 to the record holders of shares of the Company’s common stock as of the close of business on May 8, 2023.

NOTE 11. EARNINGS PER SHARE

Basic earnings per share is computed by dividing earnings by the weighted average number of common shares outstanding during each period. Diluted earnings per share is computed by dividing earnings by the total of the weighted average number of shares of common stock outstanding during each period, plus the effect of dilutive outstanding stock options and unvested restricted stock grants. Potentially dilutive securities are excluded from the computation of diluted earnings per share if their effect is anti-dilutive to the loss from continuing operations.

The following table is a reconciliation of basic and diluted shares of common stock outstanding used in the calculation of earnings per share:

	Three Months Ended
	March 31, 2023		March 31, 2022
Weighted average shares outstanding - basic		37,137		37,161
Effect of dilutive stock awards		750		2,435
Effect of dilutive deferred stock consideration for business acquisition		222		206
Weighted average shares outstanding - diluted		38,109		39,802
Net income per share:
Basic	$	0.04	$	0.14
Diluted		0.04		0.13

For the three months ended March 31, 2023 and 2022, equity awards of 3,713 and 1,329, respectively, were excluded from the calculation of earnings per share for these periods as they were anti-dilutive.

15

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 12. STOCK-BASED COMPENSATION PLAN

Under the Company’s current 2015 Stock Incentive Plan (the “2015 Plan”), the Company’s Board of Directors has flexibility to determine the type and amount of awards to be granted to eligible participants, who must be employees, directors, officers or consultants of the Company or its subsidiaries. The 2015 Plan allows for grants of incentive stock options, nonqualified stock options, restricted stock awards, stock appreciation rights, and restricted units. The aggregate number of shares of common stock that may be granted through awards under the 2015 Plan to any employee in any calendar year may not exceed 500 shares. The 2015 Plan will continue in effect until December 2025 unless terminated sooner. 

During the three months ended March 31, 2023, the Company did not issue any stock options under the 2015 Plan to employees of the Company.

Market Condition Restricted Shares Granted:

On March 14, 2023, the Company awarded the Executive Chairman 500 restricted shares under the 2015 Plan, of which 250 and 250 shares will vest if, on or before March 14, 2033, the Fair Market Value (as defined in the Plan) of the Company’s common stock shall have equaled or exceeded $15.00 and $18.00 per share for twenty consecutive trading days, respectively. As the vesting terms of the restricted shares include a market condition, the fair value of the restricted stock was estimated as of the date of grant using the Monte-Carlo pricing model with the following assumptions:

	March 14, 2023
Number issued	500
Vesting period	$15.00 - $18.00 stock price target
Grant price (per share)	$9.60
Dividend yield	1.04%
Expected volatility	45.2%
Risk-free interest rate	3.64%
Expected term (years)	2.56 - 3.22
Weighted average fair value (per share)	$7.84 - $8.34

Using these assumptions, the grant date fair value of the restricted stock awards was approximately $4,046 and the expected term was between 2.56 and 3.22 years.

The total non-cash stock compensation expense related to restricted stock, stock options and stock awards recorded by the Company for the three months ended March 31, 2023 and 2022 was $1,334 and $3,367, respectively. For the three months ended March 31, 2023 and 2022, the majority of stock-based compensation costs were classified as selling, general and administrative expenses.

As of March 31, 2023, there were 587 unvested stock options and unrecognized compensation cost of $2,797 related to unvested stock options, as well as 1,717 unvested restricted stock awards and unrecognized compensation costs of $10,836 related to unvested restricted stock awards.

NOTE 13. COMMITMENTS AND CONTINGENCIES

As a consumer goods manufacturer and distributor, the Company faces the risk of product liability and related lawsuits involving claims for substantial money damages, product recall actions and higher than anticipated rates of warranty returns or other returns of goods. The Company is therefore vulnerable to various personal injury and property damage lawsuits relating to its products and incidental to its business.

The Company is involved in various legal disputes and other legal proceedings that arise from time to time in the ordinary course of business. Anticipated costs related to litigation matters are accrued when it is both probable that a liability has been incurred and the amount can be reasonably estimated. Based on currently available information, the Company does not believe that it is reasonably possible that the disposition of any of the legal disputes the Company or its subsidiaries is currently involved in will have a material adverse effect upon the Company’s consolidated financial condition, results of operations or cash flows. There is a reasonable possibility of loss from contingencies in excess of the amounts accrued by the Company in the accompanying condensed consolidated balance sheets; however, the actual amounts of such possible losses cannot currently be reasonably estimated by the Company at this time. It is possible that, as additional information becomes available, the impact on the Company could have a different effect.

16

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 14. INCOME TAXES

The Company’s U.S. federal statutory tax rate of 21% and its foreign operations have statutory tax rates of approximately 24% in Austria, 28% in New Zealand, and 30% in Australia.

The difference between the Company’s estimated effective tax rates of 21.4% for the three months ended March 31, 2023, and the U.S. federal statutory tax rate of 21% was primarily due to the impact of stock compensation, research and experimentation expenditures and credits, and discrete stock option windfall benefits in the first quarter of 2023.

As of December 31, 2022, the Company’s gross deferred tax asset was $32,972. The Company has recorded a valuation allowance of $3,323, resulting in a net deferred tax asset of $29,649, before deferred tax liabilities of $30,243. The Company has provided a valuation allowance against a portion of the deferred tax assets as of March 31, 2023 and December 31, 2022, because the ultimate realization of those assets did not meet the more-likely-than-not criteria. The majority of the Company’s deferred tax assets consist of net operating loss carryforwards (“NOLs”) for federal tax purposes. If a change in control were to occur, these could be limited under Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended.

In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and net operating loss and credit carryforwards expire. The estimates and judgments associated with the Company’s valuation allowance on deferred tax assets are considered critical due to the amount of deferred tax assets recorded by the Company on its consolidated balance sheet and the judgment required in determining the Company’s future taxable income. The need for a valuation allowance is reassessed at each interim reporting period.

As of December 31, 2022, the Company had NOLs and research and experimentation credit for U.S. federal income tax purposes of $17,663 and $2,651, respectively. The Company believes its U.S. Federal NOLs will substantially offset its future U.S. Federal income taxes until expiration.

NOLs available to offset taxable income, subject to compliance with Section 382 of the Code, begin to expire based upon the following schedule:

Net Operating Loss Carryforward Expiration Dates
December 31, 2022
Expiration Dates December 31,	Net Operating Loss Amount
2023	$	1,851
2024		3,566
2025		1,708
2026 and beyond		10,538
Total	$	17,663

17

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

NOTE 15. SEGMENT INFORMATION

We operate our business structure within three segments. These segments are defined based on the internal financial reporting used by our chief operating decision maker to allocate resources and assess performance. Certain significant selling and general and administrative expenses are not allocated to the segments including non-cash stock compensation expense. Each segment is described below:

Our Outdoor segment, which includes Black Diamond Equipment, PIEPS, and SKINourishment, is a global leader in designing, manufacturing, and marketing innovative outdoor engineered equipment and apparel for climbing, mountaineering, trail running, backpacking, skiing, and a wide range of other year-round outdoor recreation activities. Our Outdoor segment offers a broad range of products including: high-performance, activity-based apparel (such as shells, insulation, midlayers, pants and logowear); rock-climbing footwear and equipment (such as carabiners, protection devices, harnesses, belay devices, helmets, and ice-climbing gear); technical backpacks and high-end day packs; trekking poles; headlamps and lanterns; gloves and mittens; and skincare and other sport-enhancing products. We also offer advanced skis, ski poles, ski skins, and snow safety products, including avalanche airbag systems, avalanche transceivers, shovels, and probes.

Our Precision Sport segment, which includes Sierra and Barnes, includes two iconic American manufacturers of a wide range of high-performance bullets and ammunition for both rifles and pistols. These bullets are used for precision target shooting, hunting and military and law enforcement purposes.

Our Adventure segment, which includes Rhino-Rack and MAXTRAX, is a manufacturer of highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery boards and accessories in Australia and New Zealand and a growing presence in the United States.

As noted above, the Company has a wide variety of technical outdoor equipment and lifestyle products that are sold to a variety of customers in multiple end markets. While there are multiple products sold, the terms and nature of revenue recognition policy is similar for all segments.

18

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

Financial information for our segments, as well as revenue by geography, which the Company believes provides a meaningful depiction how the nature, timing and uncertainty of revenue are affected by economic factors, is as follows:

	Three Months Ended
	March 31, 2023		March 31, 2022
Sales to external customers:
Outdoor
Domestic sales	$	21,565	$	25,629
International sales		31,210		25,893
Total Outdoor		52,775		51,522
Precision Sport
Domestic sales		20,719		27,443
International sales		6,387		5,675
Total Precision Sport		27,106		33,118
Adventure
Domestic sales		2,632		9,235
International sales		14,871		19,401
Total Adventure		17,503		28,636
Total sales to external customers		97,384		113,276
Segment operating income (loss):
Outdoor		1,490		1,888
Precision Sport		7,225		11,780
Adventure		(1,148)		2,124
Total segment operating income		7,567		15,792
Transaction costs		(74)		(1,201)
Contingent consideration benefit (expense)		1,565		(763)
Corporate and other expenses		(4,280)		(5,782)
Interest expense, net		(2,746)		(1,116)
Income before income tax	$	2,032	$	6,930

There were no intercompany sales between the Outdoor, Precision Sport, and Adventure segments for the periods presented.

Total assets by segment, as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Outdoor	$	175,390	$	175,820
Precision Sport		143,000		144,224
Adventure		178,485		181,867
Corporate		17,884		16,234
	$	514,759	$	518,145

19

CLARUS CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED

(Unaudited)

(in thousands, except per share amounts)

Capital expenditures, depreciation and amortization by segment is as follows.

	Three Months Ended
	March 31, 2023		March 31, 2022
Capital expenditures:
Outdoor	$	323	$	1,236
Precision Sport		739		450
Adventure		409		214
Total capital expenditures	$	1,471	$	1,900
Depreciation:
Outdoor	$	673	$	817
Precision Sport		852		781
Adventure		266		234
Total depreciation	$	1,791	$	1,832
Amortization:
Outdoor	$	258	$	255
Precision Sport		508		692
Adventure		2,510		3,173
Total amortization	$	3,276	$	4,120

20

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

Please note that in this Quarterly Report on Form 10-Q Clarus Corporation (which may be referred to as the “Company,” “Clarus,” “we,” “our” or “us”) may use words such as “appears,” “anticipates,” “believes,” “plans,” “expects,” “intends,” “future” and similar expressions which constitute forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based on our expectations and beliefs concerning future events impacting the Company and therefore involve a number of risks and uncertainties. We caution that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements.

Potential risks and uncertainties that could cause the actual results of operations or financial condition of the Company to differ materially from those expressed or implied by forward-looking statements in this Quarterly Report on Form 10-Q include, but are not limited to, the overall level of consumer demand on our products; general economic conditions and other factors affecting consumer confidence, preferences, and behavior; disruption and volatility in the global currency, capital and credit markets; the financial strength of the Company’s customers; the Company’s ability to implement its business strategy; the ability of the Company to execute and integrate acquisitions; changes in governmental regulation, legislation or public opinion relating to the manufacture and sale of bullets and ammunition, and the possession and use of firearms and ammunition by our customers; the Company’s exposure to product liability or product warranty claims and other loss contingencies; disruptions and other impacts to the Company’s business, as a result of an outbreak of disease or similar public health threat, such as the COVID-19 global pandemic, and government actions and restrictive measures implemented in response; stability of the Company’s manufacturing facilities and suppliers, as well as consumer demand for our products, in light of disease epidemics and health-related concerns such as the COVID-19 global pandemic; the impact that global climate change trends may have on the Company and its suppliers and customers, increased focus on sustainability issues as a result of global climate change; regulatory or market responses to global climate change; the Company's ability to protect patents, trademarks and other intellectual property rights; any breaches of, or interruptions in, our information systems; the ability of our information technology systems or information security systems to operate effectively, including as a result of security breaches, viruses, hackers, malware, natural disasters, vendor business interruptions or other causes; our ability to properly maintain, protect, repair or upgrade our information technology systems or information security systems, or problems with our transitioning to upgraded or replacement systems; the impact of adverse publicity about the Company and/or its brands, including without limitation, through social media or in connection with brand damaging events and/or public perception; fluctuations in the price, availability and quality of raw materials and contracted products as well as foreign currency fluctuations; ongoing disruptions and delays in the shipping and transportation of our products due to port congestion, container ship availability and/or other logistical challenges; the impact of political unrest, natural disasters or other crises, terrorist acts, acts of war and/or military operations; our ability to utilize our net operating loss carryforwards; changes in tax laws and liabilities, tariffs, legal, regulatory, political and economic risks; the Company’s ability to maintain a quarterly dividend; and any material differences in the actual financial results of the Company’s past and future acquisitions, including, without limitation, its previous acquisition of Rhino-Rack as compared with expectations, including the impact of acquisitions and any recognition of impairment or other charges relating to any such acquisitions on the Company’s future earnings per share. More information on potential factors that could affect the Company’s financial results is included from time to time in the Company’s public reports filed with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. All forward-looking statements included in this Quarterly Report on Form 10-Q are based upon information available to the Company as of the date of this Quarterly Report on Form 10-Q, and speak only as of the date hereof. We assume no obligation to update any forward-looking statements to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

Overview

Headquartered in Salt Lake City, Utah, Clarus Corporation (which may be referred to as the “Company,” “Clarus,” “we,” “our” or “us”) is a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor and consumer enthusiast markets. Our mission is to identify, acquire and grow outdoor “super fan” brands through our unique “innovate and accelerate” strategy. We define a “super fan” brand as a brand that creates the world’s pre-eminent, performance-defining product that the best-in-class user cannot live without. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Sierra®, Barnes®, Rhino-Rack® and MAXTRAX® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers. Our portfolio of iconic brands is well-positioned for sustainable, long-term growth underpinned by powerful industry trends across the outdoor and adventure sport end markets.

21

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

One of the key elements of our sustained financial performance is our persistent focus on brand building through product initiatives. Our iconic brands are rooted in performance-defining technologies that enable our customers to have their best days outdoors. We have a long history of technical innovation and product development, backed by an extensive patent portfolio that continues to evolve and advance our markets. We currently employ approximately 120 engineers across the portfolio, focusing on enhancing our customers’ performance in the most critical moments. Our commitment to quality, rigorous safety, and ultimately best-in-class design is evidenced by outstanding industry recognition, as we have received numerous product awards across our portfolio of super fan brands.

Each of our brands represents a unique customer value proposition. Supported by six decades of proven innovation, Black Diamond is an established global leader in high-performance, activity-based climbing, skiing, and technical mountain sports equipment. The brand is synonymous with premium performance, safety and reliability. Our Sierra and Barnes brands have been leading specialty manufacturers of bullets and ammunition for over 50 years. Since 1947, Sierra has been dedicated to manufacturing the highest-quality, most accurate bullets in the world for hunting and sport shooting enthusiasts. Barnes traces its history back to 1932, and since 1989 has manufactured technologically-advanced, lead-free bullets and premium ammunition for hunters, range shooters, military and law enforcement professionals. Founded in 1992, our Rhino-Rack brand is a globally-recognized designer and distributor of highly-engineered automotive roof racks and accessories to enhance the outdoor enthusiast’s overlanding experience. Founded in 2005, our MAXTRAX brand offers high-quality overlanding and off-road vehicle recovery and extraction tracks for the overland and off-road market.

Clarus, incorporated in Delaware in 1991, acquired Black Diamond Equipment, Ltd. (“Black Diamond Equipment”) in May 2010 and changed its name to Black Diamond, Inc. in January 2011. In October 2012, we acquired PIEPS Holding GmbH and its subsidiaries (collectively, “PIEPS”). On August 14, 2017, the Company changed its name from Black Diamond, Inc. to Clarus Corporation and its stock ticker symbol from “BDE” to “CLAR” on the NASDAQ stock exchange.

On August 21, 2017, the Company acquired Sierra Bullets, L.L.C. (“Sierra”). On November 6, 2018, the Company acquired the assets of SKINourishment, Inc. (“SKINourishment”). On October 2, 2020, the Company completed the acquisition of certain assets and liabilities constituting the Barnes business (“Barnes”). On July 1, 2021, the Company completed the acquisition of Australia-based Rhino-Rack Holdings Pty Ltd (“Rhino-Rack”). On December 1, 2021, the Company completed the acquisition of Australia-based MaxTrax Australia Pty Ltd (“MAXTRAX”).

On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend program of $0.025 per share of the Company’s common stock (the “Quarterly Cash Dividend”) or $0.10 per share on an annualized basis.  The declaration and payment of future Quarterly Cash Dividends is subject to the discretion of and approval of the Company’s Board of Directors. On April 28, 2023, the Company announced that its Board of Directors approved the payment on May 19, 2023 of the Quarterly Cash Dividend of $0.025 to the record holders of shares of the Company’s common stock as of the close of business on May 8, 2023.

Impact of COVID-19

The global outbreak of COVID-19 was declared a pandemic by the World Health Organization and a national emergency by each of the U.S., European, and Australian governments in March 2020, with governments world-wide implementing safety measures restricting travel and requiring citizen lockdowns and self-confinements for quarantining purposes. During the years ended December 31, 2020, 2021, and 2022, this had negatively affected the U.S., European, Australian and global economies, disrupted global supply chains, and resulted in significant transport restrictions and disruption of global financial markets.

An outbreak of disease or similar public health threat, such as the COVID-19 pandemic, could have, and in the case of the COVID-19 pandemic has had and may continue to have a significant impact on the global supply chain, with restrictions and limitations on related activities causing disruption and delay, along with increased raw material, storage, and shipping costs. Any of these disruptions and delays may strain domestic and international supply chains, which could negatively affect the flow or availability of certain critical raw materials and finished good products that the Company relies upon. Furthermore, the foregoing impacts may significantly increase demand from online sales channels, including our website, and could impact our logistical operations, including our fulfillment and shipping functions, which may result in periodic delays in the delivery of our products.

We expect that an outbreak of disease or similar public health threat, such as the COVID-19 pandemic, could have, and in the case of the COVID-19 pandemic may continue to have, an impact on the Company’s sales and profitability in future periods. The duration of these trends and the magnitude of such impacts cannot be precisely estimated at this time, as they are affected by a number of factors (some of which are outside management’s control), including those presented in Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2022.

22

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

Critical Accounting Policies and Use of Estimates

Management’s discussion of our financial condition and results of operations is based on the consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements. Estimates also affect the reported amounts of revenues and expenses during the reporting periods. Our critical accounting policies that require the use of estimates and assumptions were discussed in detail in our Annual Report on Form 10-K for the year ended December 31, 2022. We base our estimates on historical experience and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

There have been no significant changes to our critical accounting policies as described in our Annual Report on Form 10-K for the year ended December 31, 2022.

Accounting Pronouncements Issued Not Yet Adopted

None

‎

23

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

Results of Operations

Three Months Ended March 31, 2023 Compared to Three Months Ended March 31, 2022

The following presents a discussion of operations for the three months ended March 31, 2023, compared with the three months ended March 31, 2022.

	Three Months Ended
	March 31, 2023		March 31, 2022
Sales
Domestic sales	$	44,916	$	62,307
International sales		52,468		50,969
Total sales		97,384		113,276
Cost of goods sold		61,363		69,024
Gross profit		36,021		44,252
Operating expenses
Selling, general and administrative		32,819		34,175
Transaction costs		74		1,201
Contingent consideration (benefit) expense		(1,565)		763
Total operating expenses		31,328		36,139
Operating income		4,693		8,113
Other income (expense)
Interest expense, net		(2,746)		(1,116)
Other, net		85		(67)
Total other expense, net		(2,661)		(1,183)
Income before income tax		2,032		6,930
Income tax expense		434		1,621
Net income	$	1,598	$	5,309

Sales

Total sales decreased $15,892, or 14.0%, to $97,384 during the three months ended March 31, 2023, compared to total sales of $113,276 during the three months ended March 31, 2022. The decrease in sales was primarily attributable to a decrease in sales at the Adventure and Precision Sport segments of $11,133 and $6,012, respectively, partially offset by an increase in sales at the Outdoor segment of $1,253.

Sales in the Adventure segment decreased due to lower consumer demand given the challenging market conditions and the difficult macro-environment in both Australia and North America. Included in the Adventure segment decrease in sales is $968 of foreign exchange impact due to the strengthening of the U.S. dollar against foreign currencies during the three months ended March 31, 2023, compared to the prior period. Sales in the Precision Sport segment decreased due to ongoing supply chain challenges limiting ammunition sales. Sales in the Outdoor segment increased due to growth in the direct-to-consumer channels, and European and IGD markets, nearly offset by continued weakness at the Company’s key North American retail accounts. Increases in sales in the Outdoor segment were partially offset by $1,391 of foreign exchange impact due to the strengthening of the U.S. dollar against foreign currencies during the three months ended March 31, 2023, compared to the prior period.

Domestic sales decreased $17,391, or 27.9%, to $44,916 during the three months ended March 31, 2023, compared to domestic sales of $62,307 during the three months ended March 31, 2022. The decrease in sales was primarily attributable to a decrease in sales at the Precision Sport, Adventure, and Outdoor segments of $6,724, $6,603, and $4,064, respectively.

24

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

International sales increased $1,499, or 2.9%, to $52,468 during the three months ended March 31, 2023, compared to international sales of $50,969 during the three months ended March 31, 2022. The increase in sales was primarily attributable to an increase in sales at the Outdoor and Precision Sport segments of $5,317 and $712, respectively, partially offset by a decrease in sales at the Adventure segment of $4,530. Sales in the Outdoor and Adventure segments were reduced by $1,391 and $968, respectively, of foreign exchange impact due to the strengthening of the U.S. dollar against foreign currencies during the three months ended March 31, 2023, compared to the prior period.

Cost of Goods Sold

Cost of goods sold decreased $7,661, or 11.1%, to $61,363 during the three months ended March 31, 2023, compared to cost of goods sold of $69,024 during the three months ended March 31, 2022. The decrease in cost of goods sold was primarily attributable to a decrease in the number of units sold.

Gross Profit

Gross profit decreased $8,231, or 18.6%, to $36,021 during the three months ended March 31, 2023, compared to gross profit of $44,252 during the three months ended March 31, 2022. Gross margin was 37.0% during the three months ended March 31, 2023, compared to a gross margin of 39.1% during the three months ended March 31, 2022. Gross margin during the three months ended March 31, 2023, decreased compared to the prior year due to changes in channel and product mix of 2.2%, unfavorable foreign currency exchange movement of 1.5%, and a 1.3% negative impact due to higher inventory reserves. Channel and product mix were impacted by lower open-to-buys from the Company’s key North American retail partners in the Outdoor segment which negatively impacted gross margin. The decreases were partially offset by easing freight costs which positively impacted gross margin by 2.9%.

Selling, General and Administrative

Selling, general, and administrative expenses decreased $1,356, or 4.0%, to $32,819 during the three months ended March 31, 2023, compared to selling, general and administrative expenses of $34,175 during the three months ended March 31, 2022. The decrease is primarily due to a decrease in stock compensation of $2,034 during the three months ended March 31, 2023, compared to the prior year. The decrease was partially offset by an increase in administrative expense at the Outdoor segment of $1,824, primarily related to a higher investment in employee costs and the direct-to-consumer channel. Additionally, the Company incurred lower costs at the Adventure segment of $1,049 primarily related to disciplined cost management and a decrease in amortization expense.

Transaction Costs

Transaction expense decreased to $74 during the three months ended March 31, 2023, compared to transaction costs of $1,201 during the three months ended March 31, 2022, which consisted of expenses related to the Company’s various acquisition efforts.

Contingent Consideration (Benefit) Expense

Contingent consideration changed to a benefit of $1,565 during the three months ended March 31, 2023, compared to $763 contingent consideration expense during the three months ended March 31, 2022, which consisted of changes in the estimated fair value of contingent consideration liabilities associated with our acquisition of MAXTRAX in 2021.

Interest Expense, net

Interest expense, net increased to $2,746 during the three months ended March 31, 2023, compared to interest expense, net of $1,116 during the three months ended March 31, 2022. The increase in interest expense recognized during the three months ended March 31, 2023 was primarily associated with the increase in interest rates during the period compared to the prior year.

Other, net

Other, net, increased by $152, or 226.9%, to $85 during the three months ended March 31, 2023, compared to other, net of $(67) during the three months ended March 31, 2022. The change in other, net, was primarily attributable to a decrease in remeasurement losses recognized on the Company’s foreign denominated accounts receivable and accounts payable, which was partially offset by changes in mark-to-market adjustments on non-hedged foreign currency contracts during the three months ended March 31, 2023.

25

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

Income Taxes

Income tax expense decreased by $1,187, or 73.2%, to $434 during the three months ended March 31, 2023, compared to income tax expense of $1,621 during the same period in 2022. Our effective income tax rate was a benefit of 21.4% for the three months ended March 31, 2023, and differed compared to the statutory tax rates primarily due to the impact of stock compensation, research and experimentation expenditures and credits, and discrete stock option windfall benefits. For the three months ended March 31, 2022, our effective income tax rate was 23.4% and differed compared to the statutory tax rates due to the impact of foreign earnings taxed at applicable statutory rates and permanent book to tax differences related to incentive stock options and officer compensation limitations.

Liquidity and Capital Resources

Three Months Ended March 31, 2023 Compared to Three Months Ended March 31, 2022

Our primary ongoing funding requirements are for working capital, expansion of our operations (both organically and through acquisitions) and general corporate needs, as well as investing activities associated with the various brands. We plan to fund these activities through a combination of our future operating cash flows and borrowings on our revolving credit facility which had approximately $61,000 available to borrow at March 31, 2023, while currently maintaining compliance with the consolidated total leverage ratio per the Restated Credit Agreement of 3.75 to 1. We believe that our liquidity requirements and contractual obligations for at least the next 12 months will be adequately covered by cash provided by operations and our existing revolving credit facility. Additionally, long-term contractual obligations are also currently expected to be funded from cash from operations and availability under our existing credit facilities. For additional information regarding the Company’s existing credit facilities, see the section titled “Credit Agreement” below.

At March 31, 2023, we had total cash of $10,310, compared to a cash balance of $12,061 at December 31, 2022. At March 31, 2023, the Company had $6,108 of the $10,310 in cash held by foreign entities, of which $4,528 is considered permanently reinvested.

The following presents a discussion of cash flows for the condensed consolidated three months ended March 31, 2023 compared with the condensed consolidated three months ended March 31, 2022.

	Three Months Ended
	March 31, 2023		March 31, 2022
Net cash provided by (used in) operating activities	$	3,199	$	(10,795)
Net cash used in investing activities		(1,383)		(1,900)
Net cash (used in) provided by financing activities		(3,138)		8,467
Effect of foreign exchange rates on cash		(429)		1,214
Change in cash		(1,751)		(3,014)
Cash, beginning of year		12,061		19,465
Cash, end of period	$	10,310	$	16,451

Net Cash From Operating Activities

Net cash provided by operating activities was $3,199 during the three months ended March 31, 2023, compared to net cash used in operating activities of $10,795 during the three months ended March 31, 2022. The change in net cash provided by (used in) operating activities during 2023 is primarily due to a decrease in cash outflows related to working capital of $23,517, partially offset by an increase in contingent consideration benefit, and a decrease in stock compensation during the three months ended March 31, 2023, compared to the same period in 2022.

26

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

Free cash flow, defined as net cash provided by (used in) operating activities less capital expenditures, of $1,728 was generated during the three months ended March 31, 2023 compared to $(12,695) used during the same period in 2022. The Company believes that the non-GAAP measure, free cash flow, provides an understanding of the capital required by the Company to expand its asset base. A reconciliation of free cash flows to the nearest comparable GAAP financial measure is set forth below:

	Three Months Ended
	March 31, 2023		March 31, 2022
Net cash provided by (used in) operating activities	$	3,199	$	(10,795)
Purchase of property and equipment		(1,471)		(1,900)
Free cash flow	$	1,728	$	(12,695)

Net Cash From Investing Activities

Net cash used in investing activities was $1,383 during the three months ended March 31, 2023, compared to $1,900 during the three months ended March 31, 2022. The decrease in cash used during the three months ended March 31, 2023 is primarily due to a decrease in purchases of property and equipment, compared to the same period in 2022.

Net Cash From Financing Activities

Net cash used in financing activities was $3,138 during the three months ended March 31, 2023, compared to net cash provided by financing activities of $8,467 during the three months ended March 31, 2022. The decrease in cash provided during the three months ended March 31, 2023, compared to the same period in 2022 was primarily due to a decrease in net proceeds to the revolving line of credit and term loan.

Net Operating Loss

As of December 31, 2022, the Company had net operating loss carryforwards (“NOLs”) and research and experimentation credit for U.S. federal income tax purposes of $17,663 and $2,651, respectively. The Company believes its U.S. Federal NOLs will substantially offset its future U.S. Federal income taxes until expiration. The majority of the Company’s pre-tax income is currently earned and expected to be earned in the U.S., or taxed in the U.S. as Subpart F income and will be offset with the NOLs. The Company has $17,663 of NOLs, of which, $1,851 expire on December 31, 2023. These NOLs are subject to compliance with Section 382 of the Internal Revenue Code of 1986, as amended.

As of December 31, 2022, the Company’s gross deferred tax asset was $32,972. The Company has recorded a valuation allowance of $3,323, resulting in a net deferred tax asset of $29,649, before deferred tax liabilities of $30,243. The Company has provided a valuation allowance against a portion of the net deferred tax assets as of December 31, 2022, because the ultimate realization of those assets does not meet the more-likely-than-not criteria. The majority of the Company’s deferred tax assets consist of net operating loss carryforwards for federal tax purposes. If a change in control were to occur, these could be limited under Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended.

Credit Agreement

As of March 31, 2023, the Company had drawn $18,538 on the revolving loan and $118,750 was outstanding under the term loan. Approximately $61,000 in additional funds were available to borrow on the revolving loan at March 31, 2023, while maintaining compliance with the consolidated total leverage ratio per the Restated Credit Agreement (as defined below) of 3.75 to 1. As of March 31, 2023, the interest rates on the revolving loan and term loan commitments were approximately 6.8%. The Company was in compliance with the debt covenants set forth in the Restated Credit Agreement as of March 31, 2023.

On April 18, 2022 (the “Effective Date”), the Company, Black Diamond Retail, Inc., Black Diamond Retail – Alaska, LLC, Sierra Bullets, L.L.C., SKINourishment, LLC, Black Diamond Retail – Colorado, LLC, Black Diamond Retail – Montana, LLC, Black Diamond Retail – Wyoming, LLC, Barnes Bullets-Mona, LLC, Black Diamond Retail – Oregon, LLC, Black Diamond Retail – Vermont, LLC (collectively with the Company, the “Borrowers”) and the other loan parties party thereto (together with the Borrowers, each a “Loan Party”, and collectively, the “Loan Parties”) entered into an Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent (the “Administrative Agent”) and the lenders party thereto (the “Restated Credit Agreement”) pursuant to which the existing Credit Agreement, dated as of May 3, 2019 (as amended prior to the Effective Date, the “Existing Credit Agreement”) by and among the Company, the lenders and loan parties from time to time party thereto and the Administrative Agent

27

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

was amended and restated in its entirety. Each of the Loan Parties, other than the Company, is a direct or indirect subsidiary of the Company.

The Restated Credit Agreement provides for borrowings of up to $300,000 under a secured revolving credit facility (the “Revolving Loans”) (including up to $5,000 for letters of credit), and borrowings of up to $125,000 under a secured term loan facility (the “Term Loans”). The Restated Credit Agreement also permits the Borrowers, subject to certain requirements, to arrange with lenders for an aggregate of up to $175,000 of additional revolving and/or term loan commitments (both of which are currently uncommitted), for potential aggregate revolving and term loan commitments under the Restated Credit Agreement of up to $600,000. The proceeds of loans made under the Restated Credit Agreement may be used for working capital and general corporate purposes, including acquisitions permitted under the Restated Credit Agreement. The Restated Credit Agreement matures on April 18, 2027 (the “Maturity Date”), at which time the revolving commitments thereunder will terminate and all outstanding Revolving Loans and Term Loans, together with all accrued and unpaid interest thereon, must be repaid.

The Term Loans were fully drawn on the Effective Date and cannot be reborrowed. The Restated Credit Agreement provides for quarterly amortization payments of the Term Loans on the last business day of each March, June, September and December, commencing on June 30, 2022. Through and including the payment due on March 31, 2023, the scheduled amortization payment is $1,563 per quarter, and each scheduled amortization payment due thereafter through the Maturity Date is $3,125 per quarter.

The Borrowers may elect to have the Revolving Loans and Term Loans under the Restated Credit Agreement bear interest at an applicable rate plus either:

(i)             in the case of alternate base rate borrowings, a rate per annum generally equal to the greatest of:

(a) the prime rate in effect on such day;

(b) 0.50% plus the greater of the Federal Reserve Bank of New York’s effective federal funds rate or the Federal Reserve Bank of New York’s overnight bank funding rate in effect on such day; and

(c) 1.00% plus the adjusted term SOFR rate for a 1-month interest period;

provided that, in certain circumstances where the alternate base rate is being used as an alternate rate of interest, the alternate base rate shall be determined only according to (a) and (b), and shall be subject to a 1.00% floor; or

(ii) in the case of term benchmark borrowings, a rate per annum as follows:

(a) for borrowings denominated in U.S. Dollars, the term SOFR rate (based on one, three or six-month interest periods) plus 0.10%, subject to a 0.00% floor; or

(b) for borrowings denominated in a Foreign Currency, the applicable rate for such Foreign Currency set forth in the Restated Credit Agreement.

The applicable rate for these borrowings will range from 0.50% to 1.625% per annum, in the case of alternate base rate borrowings, and 1.50% to 2.625% per annum, in the case of term benchmark borrowings. The applicable rate was initially 0.875% per annum, in the case of alternate base rate borrowings, and 1.875% per annum, in the case of term benchmark borrowings, however, these initial applicable rates may be adjusted from time to time based upon the level of the Company’s consolidated total leverage ratio, which is more fully discussed in the Restated Credit Agreement. If one or more of the above interest rates are not determinable, or under certain other circumstances set forth in the Restated Credit Agreement, a substitute or alternative interest rate may apply under the Restated Credit Agreement.

The Restated Credit Agreement also requires the Borrowers to pay a commitment fee on the unused portion of the revolving loan commitments. Such commitment fee will range between 0.15% and 0.30% per annum, and is also based upon the level of the Company’s consolidated total leverage ratio, which is more fully discussed in the Restated Credit Agreement. The Company is also obligated to pay other customary closing fees, arrangement fees, administration fees and letter of credit fees for a credit facility of this size and type.

The Restated Credit Agreement contains customary affirmative and negative covenants, including limitations on the ability of the Company and its subsidiaries to perform the following, subject to certain customary exceptions, qualifications and “baskets”: (i) incur additional debt; (ii) create liens; (iii) engage in mergers, consolidations, certain divisions, liquidations or dissolutions other than in certain permitted instances as described in the Restated Credit Agreement; (iv) substantially change the business conducted by the

28

CLARUS CORPORATION

MANAGEMENT DISCUSSION AND ANALYSIS

(in thousands, except per share amounts)

Company and its subsidiaries; (v) make certain investments, loans, advances, guarantees and acquisitions other than in certain permitted instances as described in the Restated Credit Agreement; (vi) sell assets; (vii) pay dividends or make distributions or other restricted payments if certain conditions in the Restated Credit Agreement are not fulfilled; (viii) prepay other indebtedness; (ix) engage in certain transactions with affiliates; (x) enter into agreements that restrict dividends from subsidiaries or the ability of subsidiaries to grant liens upon their assets; (xi) amend certain charter documents and material agreements governing subordinated indebtedness; (xii) permit the consolidated total leverage ratio, which is to be determined for each quarter end on a trailing twelve month basis, from exceeding a limit of 3.75 to 1, provided, that, subject to certain terms and conditions set forth in the Restated Credit Agreement, so long as no Event of Default (as defined in the Restated Credit Agreement) exists at such time or would result therefrom, the Company may elect to increase the maximum consolidated total leverage ratio permitted under the Restated Credit Agreement to 4.25:1.00 for a period of four consecutive fiscal quarters in connection with any acquisition permitted under the Restated Credit Agreement for which the aggregate consideration is greater than or equal to $60,000; and (xiii) permit the consolidated fixed charge coverage ratio, which is to be determined for each quarter end on a trailing twelve month basis, to be less than 1.25 to 1.

The Restated Credit Agreement also contains customary events of default, including, but not limited to: (i) failure to pay amounts due under the Restated Credit Agreement; (ii) materially incorrect representations and warranties; (iii) failure to comply with covenants; (iv) change of control; and (v) default under other indebtedness aggregating at least $3,000.

The obligations of each Loan Party under the Restated Credit Agreement are guaranteed by each other Loan Party. All obligations under the Restated Credit Agreement, and the guarantees of those obligations (as well as banking services obligations and certain swap agreements), are secured by pledges and liens on 100% of the equity interests of domestic subsidiaries, either 100% or 65% of the equity interests of certain foreign subsidiaries, and the accounts receivable, inventory, intellectual property and certain real property or other assets of the Loan Parties pursuant to (i) a Pledge and Security Agreement, dated as of May 3, 2019, by and among certain of the Loan Parties and the Administrative Agent (as amended from time to time prior to the Effective Date, the “PSA”), (ii) a General Security Deed, dated as of August 30, 2021, by and among certain of the Loan Parties and the Administrative Agent (the “Oscar GSD”), (iii) a General Security Deed, dated as of January 31, 2022, by and among certain of the Loan Parties and the Administrative Agent (the “Simpson GSD”) or (iv) a mortgage or other applicable security agreement or instrument. Each of the PSA, the Oscar GSD and the Simpson GSD was reaffirmed by the Loan Parties on the Effective Date pursuant to a Reaffirmation Agreement dated as of the Effective Date by and among the Administrative Agent and the Loan Parties (the “Reaffirmation Agreement”) pursuant to which each Loan Party ratified and reaffirmed its obligations to the Lenders in connection with entering into the Restated Credit Agreement.

Off-Balance Sheet Arrangements

We do not engage in any transactions or have relationships or other arrangements with unconsolidated entities. These include special purpose and similar entities or other off-balance sheet arrangements. We also do not engage in energy, weather or other commodity-based contracts.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There has not been any material change in the market risk disclosure contained in our Annual Report on Form 10-K for the year ended December 31, 2022.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company’s management carried out an evaluation, under the supervision and with the participation of the Company’s Executive Chairman and Chief Financial Officer, its principal executive officer and principal financial officer, respectively, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15I and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”)) as of March 31, 2023, pursuant to Exchange Act Rule 13a-15. Such disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company is accumulated and communicated to the appropriate management on a basis that permits timely decisions regarding disclosure. Based upon that evaluation, the Company’s Executive Chairman and Chief Financial Officer concluded that the Company’s disclosure controls and procedures as of March 31, 2023, were effective.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting that occurred during the three months ended March 31, 2023, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.  

29

CLARUS CORPORATION

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Legal Proceedings

The Company is involved in various legal disputes and other legal proceedings that arise from time to time in the ordinary course of business. Based on currently available information, the Company does not believe that the disposition of any of the legal disputes the Company or its subsidiaries is currently involved in will have a material adverse effect upon the Company’s consolidated financial condition, results of operations or cash flows. It is possible that, as additional information becomes available, the impact on the Company of an adverse determination could have a different effect.

Litigation

The Company is involved in various lawsuits arising from time to time that the Company considers ordinary routine litigation incidental to its business. Amounts accrued for litigation matters represent the anticipated costs (damages and/or settlement amounts) in connection with pending litigation and claims and related anticipated legal fees for defending such actions, which legal fees are expensed as incurred. The costs are accrued when it is both probable that a liability has been incurred and the amount can be reasonably estimated. The accruals are based upon the Company’s assessment, after consultation with counsel (if deemed appropriate), of probable loss based on the facts and circumstances of each case, the legal issues involved, the nature of the claim made, the nature of the damages sought and any relevant information about the plaintiffs and other significant factors that vary by case. When it is not possible to estimate a specific expected cost to be incurred, the Company evaluates the range of probable loss and records the minimum end of the range. Based on currently available information, the Company does not believe that it is reasonably possible that the disposition of any of the legal disputes the Company or its subsidiaries is currently involved in will have a material adverse effect upon the Company’s consolidated financial condition, results of operations or cash flows. There is a reasonable possibility of loss from contingencies in excess of the amounts accrued by the Company in the accompanying condensed consolidated balance sheets; however, the actual amounts of such possible losses cannot currently be reasonably estimated by the Company at this time. It is possible that, as additional information becomes available, the impact on the Company could have a different effect.

Product Liability

As a consumer goods manufacturer and distributor, the Company faces the risk of product liability and related lawsuits involving claims for substantial money damages, product recall actions and higher than anticipated rates of warranty returns or other returns of goods. The Company is therefore vulnerable to various personal injury and property damage lawsuits relating to its products and incidental to its business.

Based on current information, there are no pending product liability claims and lawsuits of the Company, which the Company believes in the aggregate, will have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.

ITEM 1A. RISK FACTORS

There have been no material changes in our risk factors from those disclosed in Part I, Item 1A. of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
‎

30

CLARUS CORPORATION

ITEM 6. EXHIBITS

Exhibit	Description
10.1	Employment Agreement, dated as of March 14, 2023, between Clarus Corporation and Warren B. Kanders (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 16, 2023, and incorporated herein by reference).
10.2	Separation Agreement, dated as of March 31, 2023, between Clarus Corporation and John Walbrecht (filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on April 4, 2023, and incorporated herein by reference).
31.1	Certification of Principal Executive Officer pursuant to Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
31.2	Certification of Principal Financial Officer pursuant to Rule 13a-14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. **
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. **
101.INS	XBRL Instance Document *
101.SCH	XBRL Taxonomy Extension Schema Document *
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document *
101.LAB	XBRL Taxonomy Extension Label Linkbase Document *
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document *
104	Cover Page Interactive Data File – formatted as Inline XBRL and contained in Exhibit 101
*	Filed herewith
**	Furnished herewith

‎

31

CLARUS CORPORATION

SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	CLARUS CORPORATION
Date: May 1, 2023	By:	/s/ Warren B. Kanders
	Name:	Warren B. Kanders
	Title:	Executive Chairman
		(Principal Executive Officer)
Date: May 1, 2023	By:	/s/ Michael J. Yates
	Name:	Michael J. Yates
	Title:	Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

32

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

I, Warren B. Kanders, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Clarus Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 1, 2023	By:	/s/ Warren B. Kanders
	Name:	Warren B. Kanders
	Title:	Executive Chairman
		(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2  

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER

I, Michael J. Yates, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Clarus Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 1, 2023	By:	/s/ Michael J. Yates
	Name:	Michael J. Yates
	Title:	Chief Financial Officer
		(Principal Financial Officer and
		Principal Accounting Officer)

EX-32.1

EXHIBIT 32.1 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Clarus Corporation (the “Company”) on Form 10-Q for the period ended March 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Warren B. Kanders, Executive Chairman, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

Date: May 1, 2023	By:	/s/ Warren B. Kanders
	Name:	Warren B. Kanders
	Title:	Executive Chairman
		(Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Clarus Corporation (the “Company”) on Form 10-Q for the period ended March 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael J. Yates, Chief Financial Officer, certify to my knowledge, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: 

(1) the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. 

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. 

N
Date: May 1, 2023	By:	/s/ Michael J. Yates
	Name:	Michael J. Yates
	Title:	Chief Financial Officer
		(Principal Financial Officer and
		Principal Accounting Officer)

XML

Document And Entity Information - shares	3 Months Ended
	Mar. 31, 2023	Apr. 26, 2023
Document And Entity Information [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2023
Document Fiscal Year Focus	2023
Document Transition Report	false
Entity File Number	001-34767
Entity Registrant Name	CLARUS CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	58-1972600
Entity Address, Address Line One	2084 East 3900 South
Entity Address, City or Town	Salt Lake City
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84124
City Area Code	801
Local Phone Number	278-5552
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Title of 12(b) Security	Common Stock, par value $.0001 per share
Trading Symbol	CLAR
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding		37,190,302
Entity Central Index Key	0000913277
Current Fiscal Year End Date	--12-31
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Current assets
Cash	$ 10,310	$ 12,061
Accounts receivable, less allowance for credit losses of $1,200 and $811	68,230	66,553
Inventories	145,756	147,072
Prepaid and other current assets	9,845	9,899
Income tax receivable	3,209	3,034
Total current assets	237,350	238,619
Property and equipment, net	42,197	43,010
Other intangible assets, net	51,482	55,255
Indefinite-lived intangible assets	82,444	82,901
Goodwill	62,704	62,993
Deferred income taxes	18,168	17,912
Other long-term assets	20,414	17,455
Total assets	514,759	518,145
Current liabilities
Accounts payable	25,252	27,052
Accrued liabilities	22,125	25,170
Income tax payable	684	421
Current portion of long-term debt	12,562	11,952
Total current liabilities	60,623	64,595
Long-term debt, net	124,444	127,082
Deferred income taxes	18,226	18,506
Other long-term liabilities	18,574	15,854
Total liabilities	221,867	226,037
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; 41,625 and 41,105 issued and 37,036 and 37,094 outstanding, respectively	4	4
Additional paid in capital	680,673	679,339
Accumulated deficit	(336,175)	(336,843)
Treasury stock, at cost	(32,825)	(32,707)
Accumulated other comprehensive income (loss)	(18,785)	(17,685)
Total stockholders' equity	292,892	292,108
Total liabilities and stockholders' equity	$ 514,759	$ 518,145

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Condensed Consolidated Balance Sheets
Allowance for credit losses	$ 1,437	$ 1,211
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	41,791,000	41,637,000
Common stock, shares outstanding	37,190,000	37,048,000

XML

Condensed Consolidated Statements Of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Sales
Sales	$ 97,384	$ 113,276
Cost of goods sold	61,363	69,024
Gross profit	36,021	44,252
Operating expenses
Selling, general and administrative	32,819	34,175
Transaction costs	74	1,201
Contingent consideration expense	(1,565)	763
Total operating expenses	31,328	36,139
Operating income (loss)	4,693	8,113
Other expense
Interest expense, net	(2,746)	(1,116)
Other, net	85	(67)
Total other expense, net	(2,661)	(1,183)
Income (loss) before income tax	2,032	6,930
Income tax expense (benefit)	434	1,621
Net income (loss)	1,598	5,309
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment	(1,021)	6,077
Unrealized gain on hedging activities	(79)	86
Other comprehensive income (loss)	(1,100)	6,163
Comprehensive income (loss)	$ 498	$ 11,472
Net income per share:
Basic	$ 0.04	$ 0.14
Diluted	$ 0.04	$ 0.13
Weighted average shares outstanding:
Basic	37,137	37,161
Diluted	38,109	39,802
Domestic Sales [Member]
Sales
Sales	$ 44,916	$ 62,307
International Sales [Member]
Sales
Sales	$ 52,468	$ 50,969

XML

Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Cash Flows From Operating Activities:
Net income	$ 1,598	$ 5,309
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation of property and equipment	1,791	1,832
Amortization of other intangible assets	3,276	4,120
Amortization of debt issuance costs	232	170
Loss (gain) on disposition of property and equipment	5	9
Noncash lease expense	690	694
Contingent consideration expense	(1,565)	754
Stock-based compensation	1,334	3,367
Deferred income taxes	(105)	524
Changes in operating assets and liabilities:
Accounts receivable	(2,797)	437
Inventories	1,341	(23,137)
Prepaid and other assets	(153)	(856)
Accounts payable	90	(2,101)
Accrued liabilities	(2,612)	820
Income taxes	74	(2,737)
Net cash provided by (used in) operating activities	3,199	(10,795)
Cash Flows From Investing Activities:
Proceeds from disposition of property and equipment	88
Purchases of property and equipment	(1,471)	(1,900)
Net cash provided by (used in) investing activities	(1,383)	(1,900)
Cash Flows From Financing Activities:
Proceeds from revolving credit facilities	11,731	25,670
Repayments on revolving credit facilities	(12,153)	(13,689)
Repayments on term loans	(1,668)	(1,613)
Purchase of treasury stock	(118)	(1,097)
Proceeds from exercise of stock options		126
Cash dividends paid	(930)	(930)
Net cash provided by (used in) financing activities	(3,138)	8,467
Effect of foreign exchange rates on cash	(429)	1,214
Change in cash	(1,751)	(3,014)
Cash, beginning of year	12,061	19,465
Cash, end of period	10,310	16,451
Supplemental Disclosure of Cash Flow Information:
Cash paid income taxes	350	3,844
Cash paid for interest	2,586	926
Supplemental Disclosures of Non-Cash Investing and Financing Activities:
Property and equipment purchased with accounts payable	202	425
Lease liabilities arising from obtaining right of use assets	$ 3,941	$ 1,164

XML

Condensed Consolidated Statements Of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Deficit [Member]	Treasury Stock [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Total
Balance at Dec. 31, 2021	$ 4	$ 662,996	$ (263,342)	$ (24,440)	$ (5,050)	$ 370,168
Balance, shares at Dec. 31, 2021	41,105
Balance, shares at Dec. 31, 2021				(4,011)
Net income			5,309			5,309
Other comprehensive income (loss)					6,163	6,163
Cash dividends			(930)			(930)
Purchase of treasury stock				$ (1,097)		(1,097)
Purchase of treasury stock, shares				(51)
Stock-based compensation expense		3,367				3,367
Proceeds from exercise of options	$ 167	126				126
Balance at Mar. 31, 2022	$ 4	666,489	(258,963)	$ (25,537)	1,113	383,106
Balance, shares at Mar. 31, 2022	41,272
Balance, shares at Mar. 31, 2022				(4,062)
Balance at Dec. 31, 2022	$ 4	679,339	(336,843)	$ (32,707)	(17,685)	292,108
Balance, shares at Dec. 31, 2022	41,637
Balance, shares at Dec. 31, 2022				(4,589)
Net income			1,598			1,598
Other comprehensive income (loss)					(1,100)	(1,100)
Cash dividends			(930)			(930)
Purchase of treasury stock				$ (118)		(118)
Purchase of treasury stock, shares				(12)
Stock-based compensation expense		1,334				1,334
Proceeds from exercise of options, shares	154
Balance at Mar. 31, 2023	$ 4	$ 680,673	$ (336,175)	$ (32,825)	$ (18,785)	$ 292,892
Balance, shares at Mar. 31, 2023	41,791
Balance, shares at Mar. 31, 2023				(4,601)

XML

Condensed Consolidated Statements Of Stockholders' Equity (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Condensed Consolidated Statements Of Stockholders' Equity [Abstract]
Dividends per share	$ 0.025	$ 0.025

XML

Nature Of Operations And Summary Of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2023
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract]
Nature Of Operations And Summary Of Significant Accounting Policies	NOTE 1. NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements of Clarus Corporation and subsidiaries (which may be referred to as the “Company,” “Clarus,” “we,” “us” or “our”) as of March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), instructions to the Quarterly Report on Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments, except otherwise disclosed) necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. The results for the three months ended March 31, 2023 are not necessarily indicative of the results to be obtained for the year ending December 31, 2023. These interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on February 27, 2023. Nature of Business Headquartered in Salt Lake City, Utah, we are a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor and consumer enthusiast markets. Our mission is to identify, acquire and grow outdoor “super fan” brands through our unique “innovate and accelerate” strategy. We define a “super fan” brand as a brand that creates the world’s pre-eminent, performance-defining product that the best-in-class user cannot live without. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Sierra®, Barnes®, Rhino-Rack® and MAXTRAX® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The more significant estimates relate to the fair value of net assets acquired in business combinations, excess or obsolete inventory, allowance for credit losses, contingent consideration liabilities, and valuation of deferred tax assets, long-lived assets, goodwill and indefinite-lived intangible assets, and other intangible assets. We base our estimates on historical experience, projected future cash flows, and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

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Inventories

3 Months Ended

Mar. 31, 2023

Inventories [Abstract]

Inventories

NOTE 2. INVENTORIES

Inventories, as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Finished goods	$	107,152	$	107,453
Work-in-process		9,822		8,719
Raw materials and supplies		28,782		30,900
	$	145,756	$	147,072

XML

Property And Equipment

3 Months Ended

Mar. 31, 2023

Property And Equipment [Abstract]

Property And Equipment

NOTE 3. PROPERTY AND EQUIPMENT

Property and equipment, net, as of March 31, 2023, and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Land	$	4,160	$	4,160
Building and improvements		17,369		17,357
Furniture and fixtures		7,355		7,384
Computer hardware and software		8,615		8,498
Machinery and equipment		37,701		37,054
Construction in progress		5,165		5,028
		80,365		79,481
Less accumulated depreciation		(38,168)		(36,471)
	$	42,197	$	43,010

Depreciation expense for the three months ended March 31, 2023 and 2022 was $1,791 and $1,832, respectively.

 

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Goodwill And Intangible Assets

3 Months Ended

Mar. 31, 2023

Goodwill And Intangible Assets [Abstract]

Goodwill And Intangible Assets

NOTE 4. GOODWILL AND INTANGIBLE ASSETS

Goodwill

The following table summarizes the balances in goodwill by segment:

	Outdoor		Precision Sport		Adventure		Total
Goodwill	$	29,507	$	26,715	$	88,349	$	144,571
Accumulated goodwill impairment losses		(29,507)		-		(52,071)		(81,578)
Balance at December 31, 2022		-		26,715		36,278		62,993
Impact of foreign currency exchange rates		-		-		(289)		(289)
Balance at March 31, 2023	$	-	$	26,715	$	35,989	$	62,704

Indefinite-Lived Intangible Assets

The following table summarizes the changes in indefinite-lived intangible assets:

Balance at December 31, 2022	$	82,901
Impact of foreign currency exchange rates		(457)
Balance at March 31, 2023	$	82,444

Trademarks classified as indefinite-lived intangible assets by brand as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Black Diamond	$	19,600	$	19,600
PIEPS		3,036		2,986
Sierra		18,900		18,900
Barnes		5,600		5,600
Rhino-Rack		25,379		25,744
MAXTRAX		9,929		10,071
	$	82,444	$	82,901

Other Intangible Assets, net

The following table summarizes the changes in gross other intangible assets:

Gross balance at December 31, 2022	$	100,889
Impact of foreign currency exchange rates		(697)
Gross balance at March 31, 2023	$	100,192

Other intangible assets, net of amortization as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Intangibles subject to amortization
Customer relationships	$	76,852	$	(36,924)	$	39,928		13.8 years
Product technologies		21,130		(9,974)		11,156		10.2 years
Tradename / trademark		1,263		(865)		398		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,192	$	(48,710)	$	51,482		13.0 years
	December 31, 2022
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Customer relationships	$	77,370	$	(34,653)	$	42,717		13.8 years
Product technologies		21,309		(9,207)		12,102		10.2 years
Tradename / trademark		1,263		(827)		436		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,889	$	(45,634)	$	55,255		13.0 years

Amortization expense for the three months ended March 31, 2023 and 2022, was $3,276 and $4,120, respectively. Future amortization expense for other intangible assets as of March 31, 2023 is as follows:

Years Ending December 31,	Amortization Expense
2023 (excluding the three months ended March 31, 2023)	$	9,427
2024		10,654
2025		8,622
2026		6,619
2027		4,837
2028		3,451
Thereafter		7,872
	$	51,482

XML

Accrued Liabilities And Other Long-Term Liabilities

3 Months Ended

Mar. 31, 2023

Accrued Liabilities And Other Long-Term Liabilities [Abstract]

Accrued Liabilities And Other Long-Term Liabilities

NOTE 5. ACCRUED LIABILITIES AND OTHER LONG-TERM LIABILITIES

Accrued liabilities as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Accrued payroll and related items	$	4,626	$	5,363
Accrued bonus		1,581		1,006
Designated forward exchange contracts		207		-
Accrued warranty		1,371		1,465
Current lease liabilities		3,231		2,836
Accrued commissions		733		343
Contingent consideration liabilities		-		1,595
Accrued excise tax		764		977
Other		9,612		11,585
	$	22,125	$	25,170

Other long-term liabilities as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Long-term lease liability	$	15,629	$	12,825
Deferred stock consideration for business acquisition		2,096		2,127
Other		849		902
	$	18,574	$	15,854

XML

Long-Term Debt

3 Months Ended

Mar. 31, 2023

Long-Term Debt [Abstract]

Long-Term Debt

NOTE 6. LONG-TERM DEBT

Long-term debt as of March 31, 2023 and December 31, 2022, was as follows:

	March 31, 2023		December 31, 2022
Revolving credit facility (a)	$	18,538	$	18,049
Other debt (b)		126		1,134
Term loan (c)		118,750		120,311
Debt issuance costs		(408)		(460)
		137,006		139,034
Less current portion		(12,562)		(11,952)
	$	124,444	$	127,082

On April 18, 2022 (the “Effective Date”), the Company and certain of its direct and indirect subsidiaries entered into an Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A., as administrative agent and the lenders party thereto (the “Restated Credit Agreement”).

The Restated Credit Agreement provides for borrowings of up to $300,000 under a secured revolving credit facility (the “Revolving Loans”) (including up to $5,000 for letters of credit), and borrowings of up to $125,000 under a secured term loan facility (the “Term Loans”). The Restated Credit Agreement also permits the Company, subject to certain requirements, to arrange with lenders for an aggregate of up to $175,000 of additional revolving and/or term loan commitments (both of which are currently uncommitted), for potential aggregate revolving and term loan commitments under the Restated Credit Agreement of up to $600,000. The Restated Credit Agreement matures on April 18, 2027 (the “Maturity Date”), at which time the revolving commitments thereunder will terminate and all outstanding Revolving Loans and Term Loans, together with all accrued and unpaid interest thereon, must be repaid.

All obligations under the Restated Credit Agreement are secured by our subsidiary equity interests, as well as accounts receivable, inventory, intellectual property and certain other assets owned by the Company. The Restated Credit Agreement contains restrictions on the Company’s ability to pay dividends or make distributions or other restricted payments if certain conditions in the Restated Credit Agreement are not fulfilled. The Restated Credit Agreement also includes other customary affirmative and negative covenants, including financial covenants relating to the Company’s consolidated total leverage ratio and fixed charge coverage ratio. The Company was in compliance with the debt covenants set forth in the Credit Agreement as of March 31, 2023.

(a)As of March 31, 2023, the Company had drawn $18,538 on the revolving loan, with a maturity date of April 18, 2027. Approximately $61,000 in additional funds were available to borrow on the revolving loan at March 31, 2023, while maintaining compliance with the consolidated total leverage ratio per the Restated Credit Agreement of 3.75 to 1. The Company pays interest monthly on any borrowings on the Restated Credit Agreement. As of March 31, 2023 and December 31, 2022, the rates were approximately 6.8% and 6.3%, respectively.

(b)Foreign subsidiaries of the Company have a revolving credit facility and term debt with financial institutions which mature between April 26, 2023 and August 8, 2024. The foreign subsidiaries pay interest monthly on any borrowings on the credit facilities as well as monthly payments on the term debt. As of March 31, 2023, the interest rates ranged between approximately 3.2% and 4.0% and as of December 31, 2022, the interest rates ranged between approximately 1.3% and 4.0%. The credit facilities are secured by certain assets of the foreign subsidiaries. The revolving credit facility was settled and closed as of March 31, 2023 and had no amounts outstanding.

(c)The Company is required to repay the term loan through quarterly payments of $1,563 each beginning with June 30, 2022, increasing to $3,125 each beginning with June 30, 2023, and any remaining obligations will be repaid in full on the maturity date of the Restated Credit Agreement of April 18, 2027. The Company pays interest monthly on any borrowings on the Restated Credit Agreement. As of March 31, 2023 and December 31, 2022, the rates were approximately 6.8% and 6.3%, respectively.

 

XML

Derivative Financial Instruments

3 Months Ended

Mar. 31, 2023

Derivative Financial Instruments [Abstract]

Derivative Financial Instruments

NOTE 7. DERIVATIVE FINANCIAL INSTRUMENTS

The Company’s primary exchange rate risk management objective is to mitigate the uncertainty of anticipated cash flows attributable to changes in foreign currency exchange rates. The Company primarily focuses on mitigating changes in cash flows resulting from sales denominated in currencies other than the U.S. dollar. The Company manages this risk primarily by using currency forward and option contracts. If the anticipated transactions are deemed probable, the resulting relationships are formally designated as cash flow hedges. The Company accounts for these contracts as cash flow hedges and tests effectiveness by determining whether changes in the expected cash flow of the derivative offset, within a range, changes in the expected cash flow of the hedged item.

At March 31, 2023, the Company’s derivative contracts had remaining maturities of less than one year. The counterparties to these transactions had both long-term and short-term investment grade credit ratings. The maximum net exposure of the Company’s credit risk to the counterparties is generally limited to the aggregate unrealized loss of $207 on all contracts as March 31, 2023. The Company’s exposure of counterparty credit risk is limited to the aggregate unrealized gain of all contracts with that counterparty. At March 31, 2023, there was no such exposure to the counterparties. The Company’s derivative counterparties have strong credit ratings and as a result, the Company does not require collateral to facilitate transactions.

The Company held the following contracts designated as hedging instruments as of March 31, 2023 and December 31, 2022:

	March 31, 2023
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Euros	€ 20,871	February 2024

	December 31, 2022
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Canadian Dollars	$2,807	February 2023
Foreign exchange contracts - Euros	€ 20,760	February 2024

For contracts that qualify as effective hedge instruments, the effective portion of gains and losses resulting from changes in fair value of the instruments are included in accumulated other comprehensive loss and reclassified to sales in the period the underlying hedged transaction is recognized in earnings. Gains (losses) of $(16) and $253 were reclassified to sales during the three months ended March 31, 2023 and 2022, respectively.

The following table presents the balance sheet classification and fair value of derivative instruments as of March 31, 2023 and December 31, 2022:

	Classification	March 31, 2023		December 31, 2022
Derivative instruments in asset positions:
Designated forward exchange contracts	Prepaid and other current assets	$	-	$	357
Derivative instruments in liability positions:
Designated forward exchange contracts	Accrued liabilities	$	207	$	-
Designated forward exchange contracts	Other long-term liabilities	$	-	$	6

 

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Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2023

Accumulated Other Comprehensive Income (Loss) [Abstract]

Accumulated Other Comprehensive Income (Loss)

NOTE 8. ACCUMULATED OTHER COMPREHENSIVE LOSS

Accumulated other comprehensive loss (“AOCI”) primarily consists of foreign currency translation adjustments and changes in our forward foreign exchange contracts. The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2023:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2022	$	(17,628)	$	(57)	$	(17,685)
Other comprehensive loss before reclassifications		(1,021)		(91)		(1,112)
Amounts reclassified from other comprehensive loss		-		12		12
Net current period other comprehensive loss		(1,021)		(79)		(1,100)
Balance as of March 31, 2023	$	(18,649)	$	(136)	$	(18,785)

The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2022:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2021	$	(5,241)	$	191	$	(5,050)
Other comprehensive income before reclassifications		6,077		280		6,357
Amounts reclassified from other comprehensive income		-		(194)		(194)
Net current period other comprehensive income		6,077		86		6,163
Balance as of March 31, 2022	$	836	$	277	$	1,113

The effects on net income of amounts reclassified from unrealized gains (losses) on cash flow hedges for foreign exchange contracts for the three months ended March 31, 2023 and 2022, were as follows:

	Gains (losses) reclassified from AOCI to the Consolidated Statements of Comprehensive Income
Affected line item in the Consolidated	Three Months Ended
Statements of Comprehensive Income	March 31, 2023		March 31, 2022
Foreign exchange contracts:
Sales	$	(16)	$	253
Less: Income tax (benefit) expense		(4)		59
Amount reclassified, net of tax	$	(12)	$	194
Total reclassifications from AOCI	$	(12)	$	194

 

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Fair Value Measurements

3 Months Ended

Mar. 31, 2023

Fair Value Measurements [Abstract]

Fair Value Measurements

NOTE 9. FAIR VALUE MEASUREMENTS

We measure certain financial assets and liabilities at fair value on a recurring basis. Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

Level 1 - inputs to the valuation methodology are quoted market prices for identical assets or liabilities in active markets.

Level 2 - inputs to the valuation methodology include quoted prices in markets that are not active or model inputs that are

observable either directly or indirectly for substantially the full term of the asset or liability.

Level 3 - inputs to the valuation methodology are based on prices or valuation techniques that are unobservable.

Items Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis at March 31, 2023 and December 31, 2022 were as follows:

	March 31, 2023
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	-	$	-	$	-
	$	-	$	-	$	-	$	-
Liabilities
Designated forward exchange contracts	$	-	$	207	$	-	$	207
	$	-	$	207	$	-	$	207
	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	357	$	-	$	357
	$	-	$	357	$	-	$	357
Liabilities
Designated forward exchange contracts	$	-	$	6	$	-	$	6
Contingent consideration liabilities	$	-	$	-	$	1,595	$	1,595
	$	-	$	6	$	1,595	$	1,601

Derivative financial instruments are recorded at fair value based on current market pricing models. No nonrecurring fair value measurements existed at March 31, 2023 and December 31, 2022.  

The Company estimated the initial fair value of the contingent consideration liabilities primarily using a series of call options. Significant unobservable inputs used in the valuation included discount rates ranging from 4.8% to 8.0%. Contingent consideration liabilities are subsequently remeasured at the estimated fair value at the end of each reporting period using financial projections of the acquired company, such as sales-based milestones and estimated probabilities of achievement, with the change in fair value recognized in contingent consideration benefit in the accompanying consolidated statements of comprehensive income for such period. We measure the initial liability and remeasure the liability on a recurring basis using Level 3 inputs as defined under authoritative guidance for fair value measurements.

The following table summarizes the changes in contingent consideration liabilities:

	MAXTRAX
Balance at December 31, 2022	$	1,595
Fair value adjustments		(1,565)
Contingent consideration payments		-
Impact of foreign currency exchange rates		(30)
Balance at March 31, 2023	$	-

As the contingent consideration liabilities are remeasured to fair value each reporting period, significant increases or decreases in projected sales, discount rates or the time until payment is made could have resulted in a significantly lower or higher fair value measurement. Our determination of fair value of the contingent consideration liabilities could change in future periods based on our ongoing evaluation of these significant unobservable inputs. As of March 31, 2023, the net sales threshold required for the payment of the MAXTRAX contingent consideration is not expected to be met during the measurement period ended June 30, 2023.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2023

Stockholders' Equity [Abstract]

Stockholders' Equity

NOTE 10. STOCKHOLDERS’ EQUITY

On August 6, 2018, the Company announced that its Board of Directors approved the initiation of a quarterly cash dividend program of $0.025 per share of the Company’s common stock (the “Quarterly Cash Dividend”) or $0.10 per share on an annualized basis. The declaration and payment of future Quarterly Cash Dividends is subject to the discretion of and approval of the Company’s Board of Directors. On April 28, 2023, the Company announced that its Board of Directors approved the payment on May 19, 2023 of the Quarterly Cash Dividend of $0.025 to the record holders of shares of the Company’s common stock as of the close of business on May 8, 2023.

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Earnings Per Share

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 11. EARNINGS PER SHARE

Basic earnings per share is computed by dividing earnings by the weighted average number of common shares outstanding during each period. Diluted earnings per share is computed by dividing earnings by the total of the weighted average number of shares of common stock outstanding during each period, plus the effect of dilutive outstanding stock options and unvested restricted stock grants. Potentially dilutive securities are excluded from the computation of diluted earnings per share if their effect is anti-dilutive to the loss from continuing operations.

The following table is a reconciliation of basic and diluted shares of common stock outstanding used in the calculation of earnings per share:

	Three Months Ended
	March 31, 2023		March 31, 2022
Weighted average shares outstanding - basic		37,137		37,161
Effect of dilutive stock awards		750		2,435
Effect of dilutive deferred stock consideration for business acquisition		222		206
Weighted average shares outstanding - diluted		38,109		39,802
Net income per share:
Basic	$	0.04	$	0.14
Diluted		0.04		0.13

For the three months ended March 31, 2023 and 2022, equity awards of 3,713 and 1,329, respectively, were excluded from the calculation of earnings per share for these periods as they were anti-dilutive.

 

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Stock-Based Compensation Plan

3 Months Ended

Mar. 31, 2023

Stock-Based Compensation Plan [Abstract]

Stock-Based Compensation Plan

NOTE 12. STOCK-BASED COMPENSATION PLAN

Under the Company’s current 2015 Stock Incentive Plan (the “2015 Plan”), the Company’s Board of Directors has flexibility to determine the type and amount of awards to be granted to eligible participants, who must be employees, directors, officers or consultants of the Company or its subsidiaries. The 2015 Plan allows for grants of incentive stock options, nonqualified stock options, restricted stock awards, stock appreciation rights, and restricted units. The aggregate number of shares of common stock that may be granted through awards under the 2015 Plan to any employee in any calendar year may not exceed 500 shares. The 2015 Plan will continue in effect until December 2025 unless terminated sooner. 

During the three months ended March 31, 2023, the Company did not issue any stock options under the 2015 Plan to employees of the Company.

Market Condition Restricted Shares Granted:

On March 14, 2023, the Company awarded the Executive Chairman 500 restricted shares under the 2015 Plan, of which 250 and 250 shares will vest if, on or before March 14, 2033, the Fair Market Value (as defined in the Plan) of the Company’s common stock shall have equaled or exceeded $15.00 and $18.00 per share for twenty consecutive trading days, respectively. As the vesting terms of the restricted shares include a market condition, the fair value of the restricted stock was estimated as of the date of grant using the Monte-Carlo pricing model with the following assumptions:

	March 14, 2023
Number issued	500
Vesting period	$15.00 - $18.00 stock price target
Grant price (per share)	$9.60
Dividend yield	1.04%
Expected volatility	45.2%
Risk-free interest rate	3.64%
Expected term (years)	2.56 - 3.22
Weighted average fair value (per share)	$7.84 - $8.34

Using these assumptions, the grant date fair value of the restricted stock awards was approximately $4,046 and the expected term was between 2.56 and 3.22 years.

The total non-cash stock compensation expense related to restricted stock, stock options and stock awards recorded by the Company for the three months ended March 31, 2023 and 2022 was $1,334 and $3,367, respectively. For the three months ended March 31, 2023 and 2022, the majority of stock-based compensation costs were classified as selling, general and administrative expenses.

As of March 31, 2023, there were 587 unvested stock options and unrecognized compensation cost of $2,797 related to unvested stock options, as well as 1,717 unvested restricted stock awards and unrecognized compensation costs of $10,836 related to unvested restricted stock awards.

 

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Commitments And Contingencies	3 Months Ended
	Mar. 31, 2023
Commitments And Contingencies [Abstract]
Commitments And Contingencies	NOTE 13. COMMITMENTS AND CONTINGENCIES As a consumer goods manufacturer and distributor, the Company faces the risk of product liability and related lawsuits involving claims for substantial money damages, product recall actions and higher than anticipated rates of warranty returns or other returns of goods. The Company is therefore vulnerable to various personal injury and property damage lawsuits relating to its products and incidental to its business. The Company is involved in various legal disputes and other legal proceedings that arise from time to time in the ordinary course of business. Anticipated costs related to litigation matters are accrued when it is both probable that a liability has been incurred and the amount can be reasonably estimated. Based on currently available information, the Company does not believe that it is reasonably possible that the disposition of any of the legal disputes the Company or its subsidiaries is currently involved in will have a material adverse effect upon the Company’s consolidated financial condition, results of operations or cash flows. There is a reasonable possibility of loss from contingencies in excess of the amounts accrued by the Company in the accompanying condensed consolidated balance sheets; however, the actual amounts of such possible losses cannot currently be reasonably estimated by the Company at this time. It is possible that, as additional information becomes available, the impact on the Company could have a different effect.

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Income Taxes

3 Months Ended

Mar. 31, 2023

Income Taxes [Abstract]

Income Taxes

NOTE 14. INCOME TAXES

The Company’s U.S. federal statutory tax rate of 21% and its foreign operations have statutory tax rates of approximately 24% in Austria, 28% in New Zealand, and 30% in Australia.

The difference between the Company’s estimated effective tax rates of 21.4% for the three months ended March 31, 2023, and the U.S. federal statutory tax rate of 21% was primarily due to the impact of stock compensation, research and experimentation expenditures and credits, and discrete stock option windfall benefits in the first quarter of 2023.

As of December 31, 2022, the Company’s gross deferred tax asset was $32,972. The Company has recorded a valuation allowance of $3,323, resulting in a net deferred tax asset of $29,649, before deferred tax liabilities of $30,243. The Company has provided a valuation allowance against a portion of the deferred tax assets as of March 31, 2023 and December 31, 2022, because the ultimate realization of those assets did not meet the more-likely-than-not criteria. The majority of the Company’s deferred tax assets consist of net operating loss carryforwards (“NOLs”) for federal tax purposes. If a change in control were to occur, these could be limited under Section 382 of the Internal Revenue Code of 1986 (“Code”), as amended.

In assessing the realizability of deferred income tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible and net operating loss and credit carryforwards expire. The estimates and judgments associated with the Company’s valuation allowance on deferred tax assets are considered critical due to the amount of deferred tax assets recorded by the Company on its consolidated balance sheet and the judgment required in determining the Company’s future taxable income. The need for a valuation allowance is reassessed at each interim reporting period.

As of December 31, 2022, the Company had NOLs and research and experimentation credit for U.S. federal income tax purposes of $17,663 and $2,651, respectively. The Company believes its U.S. Federal NOLs will substantially offset its future U.S. Federal income taxes until expiration.

NOLs available to offset taxable income, subject to compliance with Section 382 of the Code, begin to expire based upon the following schedule:

Net Operating Loss Carryforward Expiration Dates
December 31, 2022
Expiration Dates December 31,	Net Operating Loss Amount
2023	$	1,851
2024		3,566
2025		1,708
2026 and beyond		10,538
Total	$	17,663

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Segment Information

3 Months Ended

Mar. 31, 2023

Segment Information [Abstract]

Segment Information

NOTE 15. SEGMENT INFORMATION

We operate our business structure within three segments. These segments are defined based on the internal financial reporting used by our chief operating decision maker to allocate resources and assess performance. Certain significant selling and general and administrative expenses are not allocated to the segments including non-cash stock compensation expense. Each segment is described below:

Our Outdoor segment, which includes Black Diamond Equipment, PIEPS, and SKINourishment, is a global leader in designing, manufacturing, and marketing innovative outdoor engineered equipment and apparel for climbing, mountaineering, trail running, backpacking, skiing, and a wide range of other year-round outdoor recreation activities. Our Outdoor segment offers a broad range of products including: high-performance, activity-based apparel (such as shells, insulation, midlayers, pants and logowear); rock-climbing footwear and equipment (such as carabiners, protection devices, harnesses, belay devices, helmets, and ice-climbing gear); technical backpacks and high-end day packs; trekking poles; headlamps and lanterns; gloves and mittens; and skincare and other sport-enhancing products. We also offer advanced skis, ski poles, ski skins, and snow safety products, including avalanche airbag systems, avalanche transceivers, shovels, and probes.

Our Precision Sport segment, which includes Sierra and Barnes, includes two iconic American manufacturers of a wide range of high-performance bullets and ammunition for both rifles and pistols. These bullets are used for precision target shooting, hunting and military and law enforcement purposes.

Our Adventure segment, which includes Rhino-Rack and MAXTRAX, is a manufacturer of highly-engineered automotive roof racks, trays, mounting systems, luggage boxes, carriers, recovery boards and accessories in Australia and New Zealand and a growing presence in the United States.

As noted above, the Company has a wide variety of technical outdoor equipment and lifestyle products that are sold to a variety of customers in multiple end markets. While there are multiple products sold, the terms and nature of revenue recognition policy is similar for all segments.

Financial information for our segments, as well as revenue by geography, which the Company believes provides a meaningful depiction how the nature, timing and uncertainty of revenue are affected by economic factors, is as follows:

	Three Months Ended
	March 31, 2023		March 31, 2022
Sales to external customers:
Outdoor
Domestic sales	$	21,565	$	25,629
International sales		31,210		25,893
Total Outdoor		52,775		51,522
Precision Sport
Domestic sales		20,719		27,443
International sales		6,387		5,675
Total Precision Sport		27,106		33,118
Adventure
Domestic sales		2,632		9,235
International sales		14,871		19,401
Total Adventure		17,503		28,636
Total sales to external customers		97,384		113,276
Segment operating income (loss):
Outdoor		1,490		1,888
Precision Sport		7,225		11,780
Adventure		(1,148)		2,124
Total segment operating income		7,567		15,792
Transaction costs		(74)		(1,201)
Contingent consideration benefit (expense)		1,565		(763)
Corporate and other expenses		(4,280)		(5,782)
Interest expense, net		(2,746)		(1,116)
Income before income tax	$	2,032	$	6,930

There were no intercompany sales between the Outdoor, Precision Sport, and Adventure segments for the periods presented.

Total assets by segment, as of March 31, 2023 and December 31, 2022, were as follows:

	March 31, 2023		December 31, 2022
Outdoor	$	175,390	$	175,820
Precision Sport		143,000		144,224
Adventure		178,485		181,867
Corporate		17,884		16,234
	$	514,759	$	518,145

Capital expenditures, depreciation and amortization by segment is as follows.

	Three Months Ended
	March 31, 2023		March 31, 2022
Capital expenditures:
Outdoor	$	323	$	1,236
Precision Sport		739		450
Adventure		409		214
Total capital expenditures	$	1,471	$	1,900
Depreciation:
Outdoor	$	673	$	817
Precision Sport		852		781
Adventure		266		234
Total depreciation	$	1,791	$	1,832
Amortization:
Outdoor	$	258	$	255
Precision Sport		508		692
Adventure		2,510		3,173
Total amortization	$	3,276	$	4,120

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Nature Of Operations And Summary Of Significant Accounting Policies (Policy)

3 Months Ended

Mar. 31, 2023

Nature Of Operations And Summary Of Significant Accounting Policies [Abstract]

Basis Of Presentation And Organization

The accompanying unaudited condensed consolidated financial statements of Clarus Corporation and subsidiaries (which may be referred to as the “Company,” “Clarus,” “we,” “us” or “our”) as of March 31, 2023 and December 31, 2022 and for the three months ended March 31, 2023 and 2022, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”), instructions to the Quarterly Report on Form 10-Q, and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments, except otherwise disclosed) necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. The results for the three months ended March 31, 2023 are not necessarily indicative of the results to be obtained for the year ending December 31, 2023. These interim financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on February 27, 2023.

Nature Of Business

Nature of Business

Headquartered in Salt Lake City, Utah, we are a global leading designer, developer, manufacturer and distributor of best-in-class outdoor equipment and lifestyle products focused on the outdoor and consumer enthusiast markets. Our mission is to identify, acquire and grow outdoor “super fan” brands through our unique “innovate and accelerate” strategy. We define a “super fan” brand as a brand that creates the world’s pre-eminent, performance-defining product that the best-in-class user cannot live without. Each of our brands has a long history of continuous product innovation for core and everyday users alike. The Company’s products are principally sold globally under the Black Diamond®, Sierra®, Barnes®, Rhino-Rack® and MAXTRAX® brand names through outdoor specialty and online retailers, our own websites, distributors and original equipment manufacturers.

Use Of Estimates

Use of EstimatesThe preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The more significant estimates relate to the fair value of net assets acquired in business combinations, excess or obsolete inventory, allowance for credit losses, contingent consideration liabilities, and valuation of deferred tax assets, long-lived assets, goodwill and indefinite-lived intangible assets, and other intangible assets. We base our estimates on historical experience, projected future cash flows, and other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates.

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Inventories (Tables)

3 Months Ended

Mar. 31, 2023

Inventories [Abstract]

Inventories

	March 31, 2023		December 31, 2022
Finished goods	$	107,152	$	107,453
Work-in-process		9,822		8,719
Raw materials and supplies		28,782		30,900
	$	145,756	$	147,072

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Property And Equipment (Tables)

3 Months Ended

Mar. 31, 2023

Property And Equipment [Abstract]

Property And Equipment

	March 31, 2023		December 31, 2022
Land	$	4,160	$	4,160
Building and improvements		17,369		17,357
Furniture and fixtures		7,355		7,384
Computer hardware and software		8,615		8,498
Machinery and equipment		37,701		37,054
Construction in progress		5,165		5,028
		80,365		79,481
Less accumulated depreciation		(38,168)		(36,471)
	$	42,197	$	43,010

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Goodwill And Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2023

Goodwill And Intangible Assets [Abstract]

Schedule Of Goodwill

	Outdoor		Precision Sport		Adventure		Total
Goodwill	$	29,507	$	26,715	$	88,349	$	144,571
Accumulated goodwill impairment losses		(29,507)		-		(52,071)		(81,578)
Balance at December 31, 2022		-		26,715		36,278		62,993
Impact of foreign currency exchange rates		-		-		(289)		(289)
Balance at March 31, 2023	$	-	$	26,715	$	35,989	$	62,704

Schedule Of Indefinite Lived Intangible Assets

Balance at December 31, 2022	$	82,901
Impact of foreign currency exchange rates		(457)
Balance at March 31, 2023	$	82,444

Schedule Of Trademarks

	March 31, 2023		December 31, 2022
Black Diamond	$	19,600	$	19,600
PIEPS		3,036		2,986
Sierra		18,900		18,900
Barnes		5,600		5,600
Rhino-Rack		25,379		25,744
MAXTRAX		9,929		10,071
	$	82,444	$	82,901

Schedule Of Definite Lived Intangible Assets, Net

Gross balance at December 31, 2022	$	100,889
Impact of foreign currency exchange rates		(697)
Gross balance at March 31, 2023	$	100,192

Schedule Of Intangible Assets, Net Of Amortization

	March 31, 2023
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Intangibles subject to amortization
Customer relationships	$	76,852	$	(36,924)	$	39,928		13.8 years
Product technologies		21,130		(9,974)		11,156		10.2 years
Tradename / trademark		1,263		(865)		398		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,192	$	(48,710)	$	51,482		13.0 years
	December 31, 2022
	Gross		Accumulated Amortization		Net		Weighted Average Useful Life
Customer relationships	$	77,370	$	(34,653)	$	42,717		13.8 years
Product technologies		21,309		(9,207)		12,102		10.2 years
Tradename / trademark		1,263		(827)		436		9.4 years
Core technologies		947		(947)		-		10.0 years
	$	100,889	$	(45,634)	$	55,255		13.0 years

Future Amortization Expense For Definite-Lived Intangible Assets

Years Ending December 31,	Amortization Expense
2023 (excluding the three months ended March 31, 2023)	$	9,427
2024		10,654
2025		8,622
2026		6,619
2027		4,837
2028		3,451
Thereafter		7,872
	$	51,482

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Accrued Liabilities And Other Long-Term Liabilities (Tables)

3 Months Ended

Mar. 31, 2023

Accrued Liabilities And Other Long-Term Liabilities [Abstract]

Schedule Of Accrued Liabilities

	March 31, 2023		December 31, 2022
Accrued payroll and related items	$	4,626	$	5,363
Accrued bonus		1,581		1,006
Designated forward exchange contracts		207		-
Accrued warranty		1,371		1,465
Current lease liabilities		3,231		2,836
Accrued commissions		733		343
Contingent consideration liabilities		-		1,595
Accrued excise tax		764		977
Other		9,612		11,585
	$	22,125	$	25,170

Schedule Of Other Long-Term Liabilities

	March 31, 2023		December 31, 2022
Long-term lease liability	$	15,629	$	12,825
Deferred stock consideration for business acquisition		2,096		2,127
Other		849		902
	$	18,574	$	15,854

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Long-Term Debt (Tables)

3 Months Ended

Mar. 31, 2023

Long-Term Debt [Abstract]

Components Of Long-Term Debt

	March 31, 2023		December 31, 2022
Revolving credit facility (a)	$	18,538	$	18,049
Other debt (b)		126		1,134
Term loan (c)		118,750		120,311
Debt issuance costs		(408)		(460)
		137,006		139,034
Less current portion		(12,562)		(11,952)
	$	124,444	$	127,082

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Derivative Financial Instruments - (Tables)

3 Months Ended

Mar. 31, 2023

Derivative Financial Instruments [Abstract]

Schedule Of Contracts Designated As Hedged Instruments

	March 31, 2023
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Euros	€ 20,871	February 2024

	December 31, 2022
	Notional	Latest
	Amount	Maturity
Foreign exchange contracts - Canadian Dollars	$2,807	February 2023
Foreign exchange contracts - Euros	€ 20,760	February 2024

Schedule Of Derivative Instruments Fair Value And Balance Sheet Classification

	Classification	March 31, 2023		December 31, 2022
Derivative instruments in asset positions:
Designated forward exchange contracts	Prepaid and other current assets	$	-	$	357
Derivative instruments in liability positions:
Designated forward exchange contracts	Accrued liabilities	$	207	$	-
Designated forward exchange contracts	Other long-term liabilities	$	-	$	6

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Accumulated Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2023

Accumulated Other Comprehensive Income (Loss) [Abstract]

Components Of Accumulated Other Comprehensive Income

The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2023:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2022	$	(17,628)	$	(57)	$	(17,685)
Other comprehensive loss before reclassifications		(1,021)		(91)		(1,112)
Amounts reclassified from other comprehensive loss		-		12		12
Net current period other comprehensive loss		(1,021)		(79)		(1,100)
Balance as of March 31, 2023	$	(18,649)	$	(136)	$	(18,785)

The following table sets forth the changes in AOCI, net of tax, for the three months ended March 31, 2022:

	Foreign Currency Translation Adjustments		Unrealized Gains (Losses) on Cash Flow Hedges		Total
Balance as of December 31, 2021	$	(5,241)	$	191	$	(5,050)
Other comprehensive income before reclassifications		6,077		280		6,357
Amounts reclassified from other comprehensive income		-		(194)		(194)
Net current period other comprehensive income		6,077		86		6,163
Balance as of March 31, 2022	$	836	$	277	$	1,113

Reclassification Out Of Accumulated Other Comprehensive Income

	Gains (losses) reclassified from AOCI to the Consolidated Statements of Comprehensive Income
Affected line item in the Consolidated	Three Months Ended
Statements of Comprehensive Income	March 31, 2023		March 31, 2022
Foreign exchange contracts:
Sales	$	(16)	$	253
Less: Income tax (benefit) expense		(4)		59
Amount reclassified, net of tax	$	(12)	$	194
Total reclassifications from AOCI	$	(12)	$	194

XML

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2023

Fair Value Measurements [Abstract]

Schedule Of Assets And Liabilities Measured On A Recurring Basis

	March 31, 2023
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	-	$	-	$	-
	$	-	$	-	$	-	$	-
Liabilities
Designated forward exchange contracts	$	-	$	207	$	-	$	207
	$	-	$	207	$	-	$	207
	December 31, 2022
	Level 1		Level 2		Level 3		Total
Assets
Designated forward exchange contracts	$	-	$	357	$	-	$	357
	$	-	$	357	$	-	$	357
Liabilities
Designated forward exchange contracts	$	-	$	6	$	-	$	6
Contingent consideration liabilities	$	-	$	-	$	1,595	$	1,595
	$	-	$	6	$	1,595	$	1,601

Schedule Of Contingent Consideration Measured At Fair Value On Recurring Basis

	MAXTRAX
Balance at December 31, 2022	$	1,595
Fair value adjustments		(1,565)
Contingent consideration payments		-
Impact of foreign currency exchange rates		(30)
Balance at March 31, 2023	$	-

XML

Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2023

Earnings Per Share [Abstract]

Schedule Of Reconciliation Of Basic And Diluted Shares Of Common Stock Outstanding Used In Calculation Of Earnings Per Share

	Three Months Ended
	March 31, 2023		March 31, 2022
Weighted average shares outstanding - basic		37,137		37,161
Effect of dilutive stock awards		750		2,435
Effect of dilutive deferred stock consideration for business acquisition		222		206
Weighted average shares outstanding - diluted		38,109		39,802
Net income per share:
Basic	$	0.04	$	0.14
Diluted		0.04		0.13

XML

Stock-Based Compensation Plan (Tables)

3 Months Ended

Mar. 31, 2023

Stock-Based Compensation Plan [Abstract]

Schedule Of Share Based Payment Award Restricted Stock Valuation Assumptions

	March 14, 2023
Number issued	500
Vesting period	$15.00 - $18.00 stock price target
Grant price (per share)	$9.60
Dividend yield	1.04%
Expected volatility	45.2%
Risk-free interest rate	3.64%
Expected term (years)	2.56 - 3.22
Weighted average fair value (per share)	$7.84 - $8.34

XML

Income Taxes (Tables)

3 Months Ended

Mar. 31, 2023

Income Taxes [Abstract]

Summary Of Tax Credit Carryforwards

Net Operating Loss Carryforward Expiration Dates
December 31, 2022
Expiration Dates December 31,	Net Operating Loss Amount
2023	$	1,851
2024		3,566
2025		1,708
2026 and beyond		10,538
Total	$	17,663

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Segment Information (Tables)

3 Months Ended

Mar. 31, 2023

Segment Information [Abstract]

Financial Information for Segments

	Three Months Ended
	March 31, 2023		March 31, 2022
Sales to external customers:
Outdoor
Domestic sales	$	21,565	$	25,629
International sales		31,210		25,893
Total Outdoor		52,775		51,522
Precision Sport
Domestic sales		20,719		27,443
International sales		6,387		5,675
Total Precision Sport		27,106		33,118
Adventure
Domestic sales		2,632		9,235
International sales		14,871		19,401
Total Adventure		17,503		28,636
Total sales to external customers		97,384		113,276
Segment operating income (loss):
Outdoor		1,490		1,888
Precision Sport		7,225		11,780
Adventure		(1,148)		2,124
Total segment operating income		7,567		15,792
Transaction costs		(74)		(1,201)
Contingent consideration benefit (expense)		1,565		(763)
Corporate and other expenses		(4,280)		(5,782)
Interest expense, net		(2,746)		(1,116)
Income before income tax	$	2,032	$	6,930

Total Assets by Segment

	March 31, 2023		December 31, 2022
Outdoor	$	175,390	$	175,820
Precision Sport		143,000		144,224
Adventure		178,485		181,867
Corporate		17,884		16,234
	$	514,759	$	518,145

Capital Expenditures, Depreciation and Amortization by Segment

	Three Months Ended
	March 31, 2023		March 31, 2022
Capital expenditures:
Outdoor	$	323	$	1,236
Precision Sport		739		450
Adventure		409		214
Total capital expenditures	$	1,471	$	1,900
Depreciation:
Outdoor	$	673	$	817
Precision Sport		852		781
Adventure		266		234
Total depreciation	$	1,791	$	1,832
Amortization:
Outdoor	$	258	$	255
Precision Sport		508		692
Adventure		2,510		3,173
Total amortization	$	3,276	$	4,120

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Inventories (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Inventories [Abstract]
Finished goods	$ 107,152	$ 107,453
Work-in-process	9,822	8,719
Raw materials and supplies	28,782	30,900
Inventories	$ 145,756	$ 147,072

XML

Property And Equipment (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Property And Equipment [Abstract]
Depreciation expense	$ 1,791	$ 1,832

XML

Property And Equipment (Property And Equipment) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 80,365	$ 79,481
Less accumulated depreciation	(38,168)	(36,471)
Property and equipment	42,197	43,010
Land [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	4,160	4,160
Building and Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	17,369	17,357
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	7,355	7,384
Computer Hardware and Software [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	8,615	8,498
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	37,701	37,054
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 5,165	$ 5,028

XML

Goodwill And Intangible Assets (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022	Dec. 31, 2022
Accumulated goodwill impairment			$ 81,578
Amortization of Intangible Assets	$ 3,276	$ 4,120
Adventure [Member]
Accumulated goodwill impairment			$ 52,071

XML

Goodwill And Intangible Assets (Schedule Of Goodwill) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Goodwill [Line Items]
Goodwill		$ 144,571
Accumulated goodwill impairment losses		(81,578)
Beginning Balance	$ 62,993
Impact of foreign currency exchange rates	(289)
Ending Balance	62,704
Outdoor [Member]
Goodwill [Line Items]
Goodwill		29,507
Accumulated goodwill impairment losses		(29,507)
Precision Sport [Member]
Goodwill [Line Items]
Goodwill		26,715
Beginning Balance	26,715
Ending Balance	26,715
Adventure [Member]
Goodwill [Line Items]
Goodwill		88,349
Accumulated goodwill impairment losses		$ (52,071)
Beginning Balance	36,278
Impact of foreign currency exchange rates	(289)
Ending Balance	$ 35,989

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Goodwill And Intangible Assets (Schedule Of Indefinite Lived Intangible Assets) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($)
Acquisitions [Abstract]
Beginning balance	$ 82,901
Impact of foreign currency exchange rates	(457)
Ending balance	$ 82,444

XML

Goodwill And Intangible Assets (Schedule of Trademarks) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Indefinite-lived Intangible Assets [Line Items]
Trademarks	$ 82,444	$ 82,901
Black Diamond Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	19,600	19,600
PIEPS Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	3,036	2,986
Sierra Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	18,900	18,900
Barnes Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	5,600	5,600
Rhino-Rack Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	25,379	25,744
MAXTRAX Trademark [Member]
Indefinite-lived Intangible Assets [Line Items]
Trademarks	$ 9,929	$ 10,071

XML

Goodwill And Intangible Assets (Schedule Of Definite Lived Intangible Assets, Net) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($)
Acquisitions [Abstract]
Gross beginning balance	$ 100,889
Impact of foreign currency exchange rates	(697)
Gross ending balance	$ 100,192

XML

Goodwill And Intangible Assets (Schedule Of Intangible Assets, Net Of Amortization) (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 100,192	$ 100,889
Accumulated amortization	(48,710)	(45,634)
Intangible assets, net	$ 51,482	$ 55,255
Weighted average useful life	13 years	13 years
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 76,852	$ 77,370
Accumulated amortization	(36,924)	(34,653)
Intangible assets, net	$ 39,928	$ 42,717
Weighted average useful life	13 years 9 months 18 days	13 years 9 months 18 days
Product Technologies [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 21,130	$ 21,309
Accumulated amortization	(9,974)	(9,207)
Intangible assets, net	$ 11,156	$ 12,102
Weighted average useful life	10 years 2 months 12 days	10 years 2 months 12 days
Trademarks And Tradenames [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 1,263	$ 1,263
Accumulated amortization	(865)	(827)
Intangible assets, net	$ 398	$ 436
Weighted average useful life	9 years 4 months 24 days	9 years 4 months 24 days
Core Technologies [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 947	$ 947
Accumulated amortization	$ (947)	$ (947)
Weighted average useful life	10 years	10 years

XML

Goodwill And Intangible Assets (Future Amortization Expense For Definite-Lived Intangible Assets) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Goodwill And Intangible Assets [Abstract]
2023 (excluding the three months ended March 31, 2023)	$ 9,427
2024	10,654
2025	8,622
2026	6,619
2027	4,837
2028	3,451
Thereafter	7,872
Intangible assets, net	$ 51,482	$ 55,255

XML

Accrued Liabilities And Other Long-Term Liabilities (Schedule Of Accrued Liabilities) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accrued Liabilities And Other Long-Term Liabilities [Abstract]
Accrued payroll and related items	$ 4,626	$ 5,363
Accrued bonus	1,581	1,006
Designated forward exchange contracts	207
Accrued warranty	1,371	1,465
Current lease liabilities	3,231	2,836
Accrued commissions	733	343
Contingent consideration liabilities		1,595
Accrued excise tax	764	977
Other	9,612	11,585
Accrued liabilities	$ 22,125	$ 25,170

XML

Accrued Liabilities And Other Long-Term Liabilities (Schedule Of Other Long-Term Liabilities) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Accrued Liabilities And Other Long-Term Liabilities [Abstract]
Long-term lease liability	$ 15,629	$ 12,825
Deferred stock consideration for business acquisition	2,096	2,127
Other	849	902
Other long-term liabilities	$ 18,574	$ 15,854

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Long-Term Debt, Net (Components Of Long-Term Debt) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Components of long-term debt
Debt issuance costs	$ (408)	$ (460)
Total carrying amount of long-term debt	137,006	139,034
Less current portion	(12,562)	(11,952)
Long-term debt, net	124,444	127,082
Revolving Credit Facility [Member]
Components of long-term debt
Credit facility	18,538	18,049
Amount outstanding	18,538	18,049
Term Facility [Member]
Components of long-term debt
Term loan	118,750	120,311
Foreign Credit Facility [Member]
Components of long-term debt
Credit facility	126	1,134
Amount outstanding	126	$ 1,134
Restated Credit Agreement [Member]
Components of long-term debt
Maximum borrowing capacity	600,000
Available additional borrowing capacity	$ 175,000
Maturity date	Apr. 18, 2027
Restated Credit Agreement [Member] | Revolving Credit Facility [Member]
Components of long-term debt
Credit facility	$ 18,538
Maximum borrowing capacity	300,000
Credit facility current borrowing capacity	$ 61,000
Maturity date	Apr. 18, 2027
Amount outstanding	$ 18,538
Interest rate at end of period	6.80%	6.30%
Restated Credit Agreement [Member] | Letter Of Credit [Member]
Components of long-term debt
Maximum borrowing capacity	$ 5,000
Restated Credit Agreement [Member] | Term Facility [Member]
Components of long-term debt
Maximum borrowing capacity	$ 125,000
Maturity date	Apr. 18, 2027
Interest rate at end of period	6.80%	6.30%
Frequency of payments	quarterly
Restated Credit Agreement [Member] | Term Facility [Member] | Through June 30, 2023 [Member]
Components of long-term debt
Payment amount	$ 1,563
Date of first required payment	Jun. 30, 2022
Restated Credit Agreement [Member] | Term Facility [Member] | After June 30, 2023 [Member]
Components of long-term debt
Payment amount	$ 3,125
Date of first required payment	Jun. 30, 2023
Foreign Credit Facility [Member] | Revolving Credit Facility [Member]
Components of long-term debt
Maturity date	Apr. 26, 2023
Foreign Credit Facility [Member] | Term Facility [Member]
Components of long-term debt
Maturity date	Aug. 08, 2024
Minimum [Member] | Foreign Credit Facility [Member]
Components of long-term debt
Interest rate at end of period	3.20%
Minimum [Member] | Foreign Credit Facility [Member]
Components of long-term debt
Interest rate at end of period		1.30%
Maximum [Member] | Foreign Credit Facility [Member]
Components of long-term debt
Interest rate at end of period	4.00%
Maximum [Member] | Foreign Credit Facility [Member]
Components of long-term debt
Interest rate at end of period		4.00%

XML

Derivative Financial Instruments (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Gain (loss) on derivatives	$ (207)
Revenue	$ 97,384	$ 113,276
Maximum [Member]
Remaining maturity of derivatives	1 year
Reclassification Out Of Accumulated Other Comprehensive Income [Member] | Unrealized Gains (Losses) on Cash Flow Hedges [Member]
Revenue	$ (16)	$ 253

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Derivative Financial Instruments (Schedule Of Contracts Designated As Hedged Instruments) (Details) - Designated as Hedging Instrument [Member] € in Thousands, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2023 EUR (€)	Dec. 31, 2022 EUR (€)	Dec. 31, 2022 CAD ($)
Canadian Dollars [Member]
Foreign Exchange Contracts [Line Items]
Foreign exchange contracts, Notional Amount | $			$ 2,807
Derivative, Maturity Date		Feb. 01, 2023
Euros [Member]
Foreign Exchange Contracts [Line Items]
Foreign exchange contracts, Notional Amount | €	€ 20,871	€ 20,760
Derivative, Maturity Date	Feb. 01, 2024	Feb. 01, 2024

XML

Derivative Financial Instruments (Schedule Of Derivative Instruments Fair Value And Balance Sheet Classification) (Details) - Forward exchange contracts [Member] - Designated as Hedging Instrument [Member] - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Prepaid And Other Current Assets [Member]
Derivative instruments in asset positions, Forward exchange contracts		$ 357
Accrued Liabilities [Member]
Derivative instruments in liability positions, Forward exchange contracts	$ 207
Other Long-Term Liabilities [Member]
Derivative instruments in liability positions, Forward exchange contracts		$ 6

XML

Accumulated Other Comprehensive Income (Loss) (Components Of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	$ (17,685)
Other comprehensive (loss) income before reclassifications	(1,112)	$ 6,357
Amounts reclassified from other comprehensive (loss) income	12	(194)
Net current period other comprehensive (loss) income	(1,100)	6,163
Balance	(18,785)
AOCI Including Portion Attributable to Noncontrolling Interest [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(17,685)	(5,050)
Balance	(18,785)	1,113
Foreign Currency Translation Adjustments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(17,628)	(5,241)
Other comprehensive (loss) income before reclassifications	(1,021)	6,077
Net current period other comprehensive (loss) income	(1,021)	6,077
Balance	(18,649)	836
Unrealized Gains (Losses) on Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(57)	191
Other comprehensive (loss) income before reclassifications	(91)	280
Amounts reclassified from other comprehensive (loss) income	12	(194)
Net current period other comprehensive (loss) income	(79)	86
Balance	$ (136)	$ 277

XML

Accumulated Other Comprehensive Income (Loss) (Reclassification Out Of Accumulated Other Comprehensive Income) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Sales	$ 97,384	$ 113,276
Less: Income tax (benefit) expense	434	1,621
Total reclassifications from AOCI	(12)	194
Unrealized Gains (Losses) on Cash Flow Hedges [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total reclassifications from AOCI	(12)	194
Reclassification Out Of Accumulated Other Comprehensive Income [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Total reclassifications from AOCI	(12)	194
Reclassification Out Of Accumulated Other Comprehensive Income [Member] | Unrealized Gains (Losses) on Cash Flow Hedges [Member]
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Sales	(16)	253
Less: Income tax (benefit) expense	(4)	59
Total reclassifications from AOCI	$ (12)	$ 194

XML

Fair Value Measurements (Narrative) (Details) - Contingent Consideration [Member]	Mar. 31, 2023 item
Minimum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount rate	0.048
Maximum [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Discount rate	0.080

XML

Fair Value Measurements (Schedule Of Assets And Liabilities Measured On A Recurring Basis) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Designated forward exchange contract, assets		$ 357
Designated forward exchange contracts, liabilities	$ 207	6
Contingent consideration liabilities		1,595
Assets		357
Liabilities	207	1,601
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Designated forward exchange contract, assets
Designated forward exchange contracts, liabilities
Contingent consideration liabilities
Assets
Liabilities
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Designated forward exchange contract, assets		357
Designated forward exchange contracts, liabilities	207	6
Assets		357
Liabilities	207	6
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Designated forward exchange contract, assets
Designated forward exchange contracts, liabilities
Contingent consideration liabilities		1,595
Assets
Liabilities		$ 1,595

XML

Fair Value Measurements (Schedule Of Contingent Consideration Measured At Fair Value On Recurring Basis) (Details) - Contingent Consideration [Member] - MAXTRAX [Member] $ in Thousands	3 Months Ended
	Mar. 31, 2023 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance at beginning of period	$ 1,595
Fair value adjustments	(1,565)
Impact of foreign currency exchange rates	$ (30)
Balance at end of period

XML

Stockholders' Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands			3 Months Ended
	Apr. 28, 2023	Aug. 06, 2018	Mar. 31, 2023	Mar. 31, 2022
Dividend per quarter		$ 0.025
Dividend annualized		$ 0.10
Cash dividends			$ 930	$ 930
Dividends per share			$ 0.025	$ 0.025
Subsequent Event [Member]
Dividend date declared	Apr. 28, 2023
Dividend date to be paid	May 19, 2023
Dividend date of record	May 08, 2023
Dividends per share	$ 0.025

XML

Earnings Per Share (Narrative) (Details) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
Antidilutive securities excluded from computation of earnings per share, number of shares	3,713	1,329

XML

Earnings Per Share (Schedule Of Reconciliation Of Basic And Diluted Shares Of Common Stock Outstanding Used In Calculation Of Earnings Per Share) (Details) - $ / shares shares in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Earnings Per Share [Abstract]
Weighted average shares outstanding - basic	37,137	37,161
Effect of dilutive stock awards	750	2,435
Effect of dilutive deferred stock consideration for business acquisition	222	206
Weighted average number of shares outstanding - diluted	38,109	39,802
Basic net income per share	$ 0.04	$ 0.14
Diluted net income per share	$ 0.04	$ 0.13

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Stock-Based Compensation Plan (Narrative) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		3 Months Ended
	Mar. 14, 2023	Mar. 31, 2023	Mar. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares of common stock that may be granted through awards to any employee in any calendar year		500
Fair value of the restricted stock awards granted	$ 4,046
Unrecognized compensation cost related to unvested stock options		$ 2,797
Unvested restricted stock awards		1,717
Unvested stock options		587
Unrecognized compensation cost related to unvested restricted stock awards		$ 10,836
Total non-cash stock compensation expense		$ 1,334	$ 3,367
2015 Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number issued	500
Minimum [Member] | 2015 Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (years)	2 years 6 months 21 days
Maximum [Member] | 2015 Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (years)	3 years 2 months 19 days
Vesting Threshold One [Member] | 2015 Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Threshold share price	$ 15.00
Number issued	250
Vesting Threshold Two [Member] | 2015 Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Threshold share price	$ 18.00
Number issued	250

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Stock-Based Compensation Plan (Schedule Of Valuation Assumptions Used In Computing Fair Value Of Stock-Based Awards) (Details) - 2015 Plan [Member] - Restricted Stock [Member] shares in Thousands	Mar. 14, 2023 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number issued | shares	500
Grant price | $ / shares	$ 9.60
Dividend yield	1.04%
Expected Volatility	45.20%
Risk-free interest rate	3.64%
Vesting Threshold One [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number issued | shares	250
Vesting Threshold Two [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number issued | shares	250
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (years)	2 years 6 months 21 days
Weighted average fair value (per share) | $ / shares	$ 7.84
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (years)	3 years 2 months 19 days
Weighted average fair value (per share) | $ / shares	$ 8.34

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Income Taxes (Narrative) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Dec. 31, 2022
Income Tax Disclosure [Line Items]
Statutory income tax rate	21.00%
Estimated effective tax rate	21.40%
Gross deferred tax asset		$ 32,972
Valuation allowance		3,323
Net deferred tax asset		29,649
Deferred tax liabilities, gross		30,243
Net operating loss carryforwards for U.S. federal income tax purposes		17,663
Research and experimentation credit carryforwards		$ 2,651
Austrian Ministry Of Finance [Member]
Income Tax Disclosure [Line Items]
Foreign statutory tax rate, foreign operations	24.00%
Inland Revenue Department, New Zealand [Member]
Income Tax Disclosure [Line Items]
Foreign statutory tax rate, foreign operations	28.00%
Australian Taxation Office [Member]
Income Tax Disclosure [Line Items]
Foreign statutory tax rate, foreign operations	30.00%

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Income Taxes (Summary Of Tax Credit Carryforwards) (Details) $ in Thousands	Dec. 31, 2022 USD ($)
Tax Credit Carryforward [Line Items]
Total net operating loss amount	$ 17,663
Operating loss carryforward expiration year 2022
Tax Credit Carryforward [Line Items]
Net operating loss amount	1,851
Operating loss carryforward expiration year 2023
Tax Credit Carryforward [Line Items]
Net operating loss amount	3,566
Operating loss carryforward expiration year 2024
Tax Credit Carryforward [Line Items]
Net operating loss amount	1,708
Operating loss carryforward expiration year 2025 and beyond [Member]
Tax Credit Carryforward [Line Items]
Net operating loss amount	$ 10,538

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Segment Information (Narrative) (Details)	3 Months Ended
	Mar. 31, 2023 segment
Segment Information [Abstract]
Number of segments	3

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Segment Information (Financial Information for Segments) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Sales to external customers	$ 97,384	$ 113,276
Operating income (expense)	4,693	8,113
Transaction costs	(74)	(1,201)
Contingent consideration (expense) benefit	1,565	(763)
Corporate and other expenses	(4,280)	(5,782)
Interest income (expense), net	(2,746)	(1,116)
Income (loss) before income tax	2,032	6,930
Operating Segments [Member]
Segment Reporting Information [Line Items]
Operating income (expense)	7,567	15,792
Outdoor [Member]
Segment Reporting Information [Line Items]
Sales to external customers	52,775	51,522
Outdoor [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Operating income (expense)	1,490	1,888
Precision Sport [Member]
Segment Reporting Information [Line Items]
Sales to external customers	27,106	33,118
Precision Sport [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Operating income (expense)	7,225	11,780
Adventure [Member]
Segment Reporting Information [Line Items]
Sales to external customers	17,503	28,636
Adventure [Member] | Operating Segments [Member]
Segment Reporting Information [Line Items]
Operating income (expense)	(1,148)	2,124
Domestic Sales [Member]
Segment Reporting Information [Line Items]
Sales to external customers	44,916	62,307
Domestic Sales [Member] | Outdoor [Member]
Segment Reporting Information [Line Items]
Sales to external customers	21,565	25,629
Domestic Sales [Member] | Precision Sport [Member]
Segment Reporting Information [Line Items]
Sales to external customers	20,719	27,443
Domestic Sales [Member] | Adventure [Member]
Segment Reporting Information [Line Items]
Sales to external customers	2,632	9,235
International Sales [Member]
Segment Reporting Information [Line Items]
Sales to external customers	52,468	50,969
International Sales [Member] | Outdoor [Member]
Segment Reporting Information [Line Items]
Sales to external customers	31,210	25,893
International Sales [Member] | Precision Sport [Member]
Segment Reporting Information [Line Items]
Sales to external customers	6,387	5,675
International Sales [Member] | Adventure [Member]
Segment Reporting Information [Line Items]
Sales to external customers	$ 14,871	$ 19,401

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Segment Information (Total Assets by Segments) (Details) - USD ($) $ in Thousands	Mar. 31, 2023	Dec. 31, 2022
Segment Reporting Information [Line Items]
Assets	$ 514,759	$ 518,145
Outdoor [Member]
Segment Reporting Information [Line Items]
Assets	175,390	175,820
Precision Sport [Member]
Segment Reporting Information [Line Items]
Assets	143,000	144,224
Adventure [Member]
Segment Reporting Information [Line Items]
Assets	178,485	181,867
Corporate [Member]
Segment Reporting Information [Line Items]
Assets	$ 17,884	$ 16,234

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Segment Information (Capital Expenditures, Depreciation and Amortization by Segment) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2023	Mar. 31, 2022
Segment Reporting Information [Line Items]
Capital expenditures	$ 1,471	$ 1,900
Depreciation	1,791	1,832
Amortization	3,276	4,120
Outdoor [Member]
Segment Reporting Information [Line Items]
Capital expenditures	323	1,236
Depreciation	673	817
Amortization	258	255
Precision Sport [Member]
Segment Reporting Information [Line Items]
Capital expenditures	739	450
Depreciation	852	781
Amortization	508	692
Adventure [Member]
Segment Reporting Information [Line Items]
Capital expenditures	409	214
Depreciation	266	234
Amortization	$ 2,510	$ 3,173