The following discussion and analysis is based upon our financial statements as of the dates and for the periods presented in this section. You should read this discussion and analysis in conjunction with the financial statements and notes thereto found in Part I, Item 1 of this Form 10-Q and our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended
March 31, 2022(the "2022 Form 10-K"). All references to the first quarters of fiscal 2023 and fiscal 2022 mean for the three-month period ended June 30, 2022and 2021, respectively. Unless the context otherwise requires, "Nautilus," "we," "us" and "our" refer to Nautilus, Inc.and its subsidiaries. Unless indicated otherwise, all information regarding our operating results pertains to our continuing operations.
Avviso cautelativo sulle dichiarazioni previsionali
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "plan," "expect," "aim," "believe," "project," "intend," "estimate," "will," "should," "could," and other terms of similar meaning typically identify forward-looking statements. We also may make forward-looking statements in our other documents filed with or furnished to the
U.S. Securities and Exchange Commission(the "SEC"). In addition, our senior management may make forward-looking statements orally to analysts, investors, representatives of the media and others. Forward-looking statements include any statements related to our future business, financial performance or operating results; anticipated fluctuations in net sales due to seasonality; plans and expectations regarding gross and operating margins; plans and expectations regarding research and development expenses and capital expenditures and anticipated results from such expenditures and other investments in our capabilities and resources; anticipated losses from discontinued operations; plans for new product introductions, strategic partnerships and anticipated demand for our new and existing products; and statements regarding our inventory and working capital requirements and the sufficiency of our financial resources. These forward-looking statements, and others we make from time-to-time, are subject to a number of risks and uncertainties. Many factors could cause actual results to differ materially from those projected in forward-looking statements, including our ability to timely acquire inventory that meets our quality control standards from sole source foreign manufacturers at acceptable costs, changes in consumer fitness trends, changes in the media consumption habits of our target consumers or the effectiveness, availability and price of media time consistent with our cost and audience profile parameters, greater than anticipated costs or delays associated with launch of new products, weaker than expected demand for new or existing products, a decline in consumer spending due to unfavorable economic conditions, softness in the retail marketplace or the availability from retailers of heavily discounted competitive products, an adverse change in the availability of credit for our customers who finance their purchases, our ability to pass along vendor raw material price increases and other cost pressures, including increased shipping costs and unfavorable foreign currency exchange rates, tariffs, risks associated with current and potential delays, work stoppages, or supply chain disruptions caused by the coronavirus pandemic, our ability to hire and retain key management personnel, our ability to effectively develop, market and sell future products, the availability and timing of capital for financing our strategic initiatives, including being able to raise capital on favorable terms or at all; changes in the financial markets, including changes in credit markets and interest rates that affect our ability to access those markets on favorable terms, the impact of any future impairments, our ability to protect our intellectual property, the introduction of competing products, and our ability to get foreign-sourced product through customs in a timely manner. Additional assumptions, risks and uncertainties are described in Part I, Item 1A, "Risk Factors," in our 2022 Form 10-K as supplemented or modified in our quarterly reports on Form 10-Q. We do not undertake any duty to update forward-looking statements after the date they are made or conform them to actual results or to changes in circumstances or expectations.
We empower healthier living through individualized connected fitness experiences and are committed to building a healthier world, one person at a time. Our principal business activities include designing, developing, sourcing and marketing high-quality cardio and strength fitness products, related accessories and digital platform for consumer use, primarily in the
U.S., Canada, Europeand Asia. Our products are sold under some of the most-recognized brand names in the fitness industry: Bowflex®, Schwinn®, JRNY® and Nautilus®. We market our products through two distinct distribution channels, Direct and Retail, which we consider to be separate business segments. Our Direct business offers products directly to consumers primarily through websites. Our Retail business offers our products through a network of independent retail companies to reach consumers in the home use markets in the U.S.and internationally. We also derive a portion of our revenue from the licensing of our brands and intellectual property. 21
Our results for the three-months ended
June 30, 2022, are driven by the actions outlined in our North Starstrategy. The five strategic pillars of our North Starstrategy are: (1) Adopt a consumer first mindset; (2) Scale a differentiated digital offering; (3) Focus investments on core businesses; (4) Evolve supply chain to be a strategic advantage; and (5) Build organizational capabilities to win by unleashing the power of our team. We intend to leverage our many strengths to transform into a company that empowers healthier living through individualized connected fitness experiences. Our transformation will properly leverage our leading brands, products, innovation, distribution and digital assets to build a healthier world, one person at a time. At the center of health and well-being is fitness and the market has so far behaved largely as we expected. The market size more than doubled over the past 2 years, is regulating from its peak with more normal seasonality, and we expect will settle at a "new normal" significantly above pre-pandemic levels based on a profound evolution in consumers' workouts and workplace habits. As a result of these changed habits and sentiments, we continue to believe much of the industry growth opportunity will remain at elevated levels relative to pre-pandemic. This results in stronger opportunity for our industry and Nautilus. For fiscal 2023, we expect to return to a more typical pre-pandemic seasonality, with the second half of the fiscal year contributing more of the full year's revenue. Additionally, to gauge sales growth and progress against more "normalized," or pre-pandemic results, we will rely more heavily on measuring performance of fiscal 2023 sales growth versus the pre-pandemic twelve-month period ended March 31, 2020("fiscal 2020") to guide business strategy, rather than measuring performance against the atypical, outsized results that occurred during the pandemic.
Confronto dei tre mesi trascorsi
•Net sales were
$54.8 million, compared to $184.6 million, a decline of 70.3% versus last year. Net sales are up 11%, or 3% CAGR, when compared to the same period in fiscal 2020, excluding sales related to the Octane brand, which was sold in October 2020. The sales decline versus last year is driven primarily by the return to pre-pandemic seasonal demand. •Net sales of our Direct segment decreased by $36.9 million, or 58.2%, for the three-months ended June 30, 2022, compared to the three-months ended June 30, 2021. The net sales decrease was primarily driven by higher sales discounting and the return to pre-pandemic seasonal demand. •Net sales of our Retail segment decreased by $93.0 million, or 77.2%, for the three-months ended June 30, 2022, compared to the three-months ended June 30, 2021. Excluding sales related to the Octane brand, which was sold in 2020, net sales were down 2%, or a -1% CAGR, compared to the same period in fiscal 2020. The decrease in sales compared to last year is primarily driven by lower cardio sales and higher sales discounting as Retailers work through higher-than-normal inventory levels.
• Proventi da royalties per i tre mesi chiusi
•Gross profit was
$7.0 million, compared to $55.5 millionlast year. Gross profit margins were 12.7% compared to 30.1% last year. The 17.4 ppt decrease in gross margins was primarily due to increased discounting (-8 ppts), unfavorable logistics overhead absorption (-8 ppts) and increased investments in JRNY® (-4 ppts), offset by improvements in other costs (3 ppts). •Operating expenses were $58.1 million, an increase of $20.5 million, or 54.5%, compared to last year, primarily due to a goodwill and intangible impairment charge of $27.0 millionand a $3.6 millionincrease in JRNY® investments, partially offset by $5.7 millionlower media spending and $2.7 millionlower other variable selling and marketing expenses due to decreased sales. Total advertising expenses were $5.1 millionversus $10.8 millionlast year. 22 -------------------------------------------------------------------------------- Table of Contents •Operating loss was $51.2 millionor negative 93.4% operating margin, compared to operating income of $17.9 millionlast year, primarily driven by a goodwill and intangible impairment charge of $27.0 millionand lower gross profit associated with lower sales demand during the period. •Loss from continuing operations was $60.2 million, or $(1.92)per diluted share, compared to income of $14.0 million, or $0.43per diluted share, last year.
• perdita netta era
•The income tax expense was
$8.1 millionthis year compared to $3.4 millionlast year. The income tax expense this year was primarily a result of a U.S.deferred tax asset valuation allowance in the amount of $14.2 millionrecorded this quarter. North Star Strategy Update JRNY® Digital Platform
• Nautilus continua a migliorare la piattaforma JRNY® con molte caratteristiche uniche, inclusa l'espansione delle esperienze differenziate di fitness visivo dei membri JRNY®.
June 30, 2022, Members of JRNY®, Nautilus' personalized connected fitness platform, exceeded 360k representing approximately 133% growth versus the same quarter last year. Of these members, 127k were Subscribers, representing approximately 290% growth over the same period. We define JRNY® Members as all individuals who have a JRNY® account and/or subscription, which includes Subscribers, their respective associated users and users who consume free content. We define Subscribers as a person or household who paid for a Subscription, are in a trial, or have requested a "pause"' to their subscriptions for up to three months. •Additionally, the Company has made great strides over the last two years expanding the number of products featuring JRNY® connectivity. In FY 2022, approximately 80% of total units sold were JRNY® compatible, compared to only 22% in the pre-pandemic FY 2020. The trend of approximately 80% of total units sold being JRNY® compatible continued in Q1 FY 2023. •Nautilus' integration of VAY's motion-tracking capabilities into JRNY® will further advance and accelerate personalized strength workout options, including the addition of rep counting and form coaching for SelectTech® users, which we believe will drive JRNY® membership growth during FY 2023.
Le seguenti dichiarazioni previsionali riflettono le aspettative della società per l'intero anno fiscale 2023 a partire da
• La società ribadisce le linee guida per il secondo semestre e l'intero anno 2023.
Secondo semestre e anno fiscale 2023
• L'azienda prevede ricavi per l'intero anno
•Given the impact of elevated inventory levels at the Company's retail partners, the Company expects the 2nd half of the year to represent between 65% and 70% of full year sales, slightly higher than pre-pandemic 2nd half seasonality of approximately 60%. •Gross margins for the second half of the year are expected to be in the range of 27% to 30%. Improvements versus last year are driven by lower in-bound freight and demurrage fees, and the reduction in logistics facilities footprint. The Company is closing one of its distribution centers when the associated lease expires in the Fall of 2022 and will not be renewing the leases of some storage locations.
• Ci aspettiamo che il numero dei membri del JRNY® superi i 500.000
Fattori che influenzano le nostre prestazioni
I risultati delle nostre operazioni possono variare notevolmente da periodo a periodo.
Our revenues typically fluctuate due to the seasonality of our industry, customer buying patterns, product innovation, the nature and level of competition for health and fitness products, our ability to procure products to meet customer demand, the level of spending on, and effectiveness of, our media and advertising programs and our ability to attract new customers and maintain existing sales relationships. In addition, our revenues are highly susceptible to economic factors, including, among other things, the overall condition of the economy and the availability of consumer credit in both the
U.S.and Canada. The COVID-19 pandemic created a heightened need for home-fitness products at an unprecedented rate and as the pandemic lessened there was a return to a more normal seasonality. We cannot predict with certainty the longer-term impacts of the COVID-19 pandemic and the change to consumer habits and sentiments and therefore, the impact on our results of operations is uncertain. Our gross margins are being impacted by, among other things: •Increased product costs, primarily driven by our increasing use of more expensive components in our products, which now include our connected fitness JRNY® platform. •Fluctuations in the availability, and as a result the costs, of materials used to manufacture our products. •Tariffs and expedited shipping and transportation costs. •Fluctuations in cost associated with the acquisition or license of products and technologies, product warranty claims, fuel, foreign currency exchange rates, and changes in costs of other distribution or manufacturing-related services. •Costs relating to the addition of a new distribution facility in Southern Californiaprior to the anticipated exit from our Portland DC facility. •The efficiency and effectiveness of our organization and operations. •A return to product discounting practices in place prior to the pandemic, which were temporarily suspended in part during the pandemic. Our operating profits or losses may also be affected by the efficiency and effectiveness of our organization. Historically, our operating expenses have been influenced by media costs to produce and distribute advertisements of our products on television, websites and other media, facility costs, operating costs of our information and communications systems, product supply chain management, customer support and new product development activities. In addition, our operating expenses have been affected from time-to-time by asset impairment charges, restructuring charges and other significant unusual or infrequent expenses. As a result of the above and other factors, our period-to-period operating results may not be indicative of future performance. You should not place undue reliance on our operating results and should consider our prospects in light of the risks, expenses and difficulties typically encountered by us and other companies, both within and outside our industry. We may not be able to successfully address these risks and difficulties and, consequently, we cannot assure you of any future growth or profitability. For more information, see our discussion of risk factors located at Part I, Item 1A of our 2022 Form 10-K as supplemented by our quarterly reports on Form 10-Q.
Results from discontinued operations relate to the disposal of our former Commercial business, which was completed in
April 2011. We reached substantial completion of asset liquidation as of December 31, 2012. Although there was no revenue related to the former Commercial business in the fiscal 2022 or year-to-date fiscal 2023 periods, we continue to incur product liability and other legal expenses associated with product previously sold into the Commercial channel. 24 -------------------------------------------------------------------------------- Table of Contents RESULTS OF OPERATIONS Results of operations information was as follows (in thousands): Three-Months Ended June 30, Change 2022 2021 $ % Net sales $ 54,817 $ 184,593 $ (129,776)(70.3) % Cost of sales 47,860 129,088 (81,228) (62.9) % Gross profit 6,957 55,505 (48,548) (87.5) % Operating expenses: Selling and marketing 12,891 21,300 (8,409) (39.5) % General and administrative 12,463 11,523 940 8.2 % Research and development 5,823 4,815 1,008 20.9 % Goodwill and intangible impairment charge 26,965 - 26,965 NM Total operating expenses 58,142 37,638 20,504 54.5 % Operating (loss) income (51,185) 17,867 (69,052) (386.5) % Other expense: Interest income 1 21 (20) Interest expense (376) (314) (62) Other, net (514) (120) (394) Total other expense, net (889) (413) (476)
(Perdita) Risultato dell'attività continuativa prima delle imposte sul reddito
(52,074) 17,454 (69,528) Income tax expense 8,096 3,438 4,658 (Loss) income from continuing operations (60,170) 14,016 (74,186) Loss from discontinued operations, net of taxes (7) (132) 125 Net (loss) income
$ (60,177) $ 13,884 $ (74,061)NM = Not meaningful 25
Sommario I risultati delle informazioni operative per settore e principali linee di prodotto sono stati i seguenti (in migliaia di dollari):
Three-Months Ended June 30, Change 2022 2021 $ % Net sales: Direct net sales: Cardio products(1)
$ 17,133 $ 31,430 $ (14,297)(45.5) % Strength products(2) 9,343 31,966 (22,623) (70.8) % Direct 26,476 63,396 (36,920) (58.2) % Retail net sales: Cardio products(1) $ 11,843 $ 89,924 $ (78,081)(86.8) % Strength products(2) 15,601 30,560 (14,959) (48.9) % Retail 27,444 120,484 (93,040) (77.2) % Royalty 897 713 184 25.8 % $ 54,817 $ 184,593 $ (129,776)(70.3) % Cost of sales: Direct $ 21,914 $ 38,882 $ (16,968)(43.6) % Retail 25,946 90,206 (64,260) (71.2) % $ 47,860 $ 129,088 $ (81,228)(62.9) % Gross profit: Direct $ 4,562 $ 24,514 $ (19,952)(81.4) % Retail 1,498 30,278 (28,780) (95.1) % Royalty 897 713 184 25.8 % $ 6,957 $ 55,505 $ (48,548)(87.5) % Gross profit margin: Direct 17.2 % 38.7 % (2,150) basis points Retail 5.5 % 25.1 % (1,960) basis points Contribution: Direct $ (9,893) $ 6,759 $ (16,652)(246.4) % Retail (5,408) 22,090 (27,498) (124.5) % Contribution rate: Direct (37.4) % 10.7 % (4,810) basis points Retail (19.7) % 18.3 % (3,800) basis points (1) Cardio products include: connected-fitness bikes, the Bowflex® C6, VeloCore®, Schwinn® IC4, Max Trainer®, connected-fitness treadmills, other exercise bikes, ellipticals and subscription services. (2) Strength products include: Bowflex® Home Gyms, Bowflex® SelectTech® dumbbells, kettlebell and barbell weights, and accessories. 26
Table of Contents Sales and Gross Profit Direct Segment
Confronto dei risultati di settore per il trimestre concluso
Net sales were
$26.5 millionfor the three-month period ended June 30, 2022, compared to $63.4 million, a decline of 58.2%, versus the same period in 2021, and up 27.1% compared to the same period in fiscal 2020. Net sales decrease was primarily driven by the return to pre-pandemic seasonal demand and higher sales discounting. Cardio sales declined 45.5% versus the same period in 2021, and were up 6.5% compared to the same period in fiscal 2020. Lower cardio sales this quarter were primarily driven by lower bike demand. Strength product sales declined 70.8% versus the same period in 2021, and increased 96.7% compared to the same period in fiscal 2020. Lower strength sales this quarter were primarily driven by lower demand for SelectTech® weights. The Direct segment ended the quarter with $0.4 millionof backlog as of June 30, 2022, as product demand has declined compared the same period last year. These amounts represent unfulfilled consumer orders net of current promotional programs and sales discounts. Gross profit margin was 17.2% for the three-month period ended June 30, 2022versus 38.7% for the same period in 2021. The 21.5 ppt decrease in gross margin was primarily driven by: increased discounting (-8 ppts), unfavorable logistics overhead absorption (-7 ppts), and increased investments in JRNY® (-7 ppts). Gross profit was $4.6 million, down 81.4% versus the same period in 2021. Segment contribution loss was $9.9 millionfor the three-month period ended June 30, 2022, compared to segment contribution income of $6.8 millionfor the same period in 2021. The decline was primarily driven by lower gross profit, as explained above, offset by decreased media spend. Advertising expenses were $5.2 millioncompared to $8.0 millionfor the same period in 2021. Combined consumer credit approvals by our primary and secondary U.S.third-party financing providers for the three-month period ended June 30, 2022were 53.8%, compared to 53.0% for the same period in 2021. The increase in approvals reflects higher credit quality applications.
Confronto dei risultati di settore per il trimestre concluso
Net sales for the three-month period ended
June 30, 2022were $27.4 million, down 77.2%, from $120.5 millionfor the same period in 2021. Excluding sales related to Octane, net sales were down 2% compared to the same period in fiscal 2020. Retail segment sales outside the United Statesand Canadawere down 83.4% versus last year. The decrease in sales compared to last year is primarily driven by lower cardio sales and higher sales discounting as Retailers work through higher than normal inventory levels. Cardio sales for the three-month period ended June 30, 2022decreased by 86.8%. Excluding sales related to Octane, cardio sales were down 28.7% compared to the same period in fiscal 2020. Strength product sales declined by 48.9% versus last year. Strength sales were up 36.8% compared to the same period in fiscal 2020, led by the popular SelectTech® weights. The decrease in sales compared to last year is primarily driven by lower bike sales and higher sales discounting as Retailers work through higher than normal inventory levels. As of June 30,2022, the Retail segment's backlog totaled $48.0 million, as retailers are now ordering closer to time of need compared to the same period last year. These amounts represent customer orders for future shipments and are net of contractual rebates and consideration payable to applicable Retail customers. Gross profit margins were 5.5% for the three-month period ended June 30, 2022, down from 25.1% for the same period in 2021. The 19.6 ppt decrease in gross margin was primarily driven by: increased discounting (-11 ppts) and unfavorable logistics overhead absorption (-9 ppts). Gross profit was $1.5 million, a decrease of 95.1% versus the same period in 2021. 27 -------------------------------------------------------------------------------- Table of Contents Segment contribution loss for the three-month period ended June 30, 2022was $5.4 million, or 19.7% of sales, compared to segment contribution income of $22.1 million, or 18.3% of sales for the same period in 2021, primarily driven by lower gross profit as explained above.
Il reddito da royalties è aumentato di
Vendita e marketing
Selling and marketing expenses include payroll, employee benefits, and other headcount-related expenses associated with sales and marketing personnel, and the costs of media advertising, promotions, trade shows, seminars, sales incentives related to our JRNY® platform and other programs.
Le informazioni di vendita e marketing erano le seguenti (in migliaia di dollari):
Three-Months Ended June 30, Change 2022 2021 $ %
Vendita e marketing
23.5 % 11.5 % The decrease in selling and marketing expenses for the three-month period ended
June 30, 2022compared to the same period of 2021 was primarily related to a decrease of $5.7 millionin media spend and a decrease of $2.7 millionin other variable selling and marketing expenses due to decreased sales. We expect variable selling and marketing expenses to continue to flex with sales.
Le spese pubblicitarie sui media sono la più grande componente di vendita e marketing ed erano le seguenti (in migliaia di dollari):
Three-Months Ended June 30, Change 2022 2021 $ % Total advertising
$ 5,120 $ 10,824 $ (5,704)(52.7)% The $5.7 milliondecrease in media advertising expense for the three-month period ended June 30, 2022, as compared to the same period of 2021 reflects a return to more historical, pre-pandemic levels of advertising support to preserve market share and control costs. Advertising as a percentage of selling and marketing for the three-month period ended June 30, 2022was 39.7% as compared to 50.8% for the same quarter last year and 37.2% for the same period in fiscal 2020. General and Administrative General and administrative expenses include payroll, employee benefits, stock-based compensation expense, and other headcount-related expenses associated with finance, legal, facilities, certain human resources and other administrative personnel, and other administrative fees.
Il generale e l'amministrazione erano i seguenti (in migliaia di dollari):
Three-Months Ended June 30, Change 2022 2021 $ % General and administrative
$ 12,463 $ 11,523 $ 9408.2% As % of net sales 22.7 % 6.2 % 28
-------------------------------------------------------------------------------- Table of Contents The increase in general and administrative expenses for the three-month period ended
June 30, 2022compared to the same period of 2021 was primarily due to increases in personnel costs. Research and Development Research and development expenses include payroll, employee benefits, other headcount-related expenses and information technology associated with product development.
La ricerca e sviluppo è stata la seguente (in migliaia di dollari):
Three-Months Ended June 30, Change 2022 2021 $ % Research and development
$ 5,823 $ 4,815 $ 1,00820.9% As % of net sales 10.6 % 2.6 %
Aumento delle spese di ricerca e sviluppo per il trimestre in scadenza
Goodwilland Intangible Impairment Charge In accordance with ASC 350 - Intangibles - Goodwilland Other, we perform a goodwill and indefinite-lived asset impairment evaluation during the fourth quarter of each year. However, as a result of the decline in our market value relative to the market and our industry, which was identified as a triggering event, we performed an interim evaluation and a market capitalization reconciliation during the first quarter of fiscal 2023, which resulted in a non-cash goodwill and indefinite-lived intangible assets impairment charge of $27.0 million. ASC 350 requires us to make significant assumptions and estimates about the extent and timing of future cash flows, discount rates, growth rates and terminal value. The cash flows are estimated over a significant future period of time, which makes those estimates and assumptions subject to an even higher degree of uncertainty. We also use market valuation models and other financial ratios, which require us to make certain assumptions and estimates regarding the applicability of those models to our assets and businesses. In accordance with ASC 360 - Property, Plant, and Equipment and other long-lived assets, we perform a test for recoverability when triggering events occur. No impairment was recognized in the quarter ended June 30, 2022.
Per ulteriori informazioni relative al nostro avviamento e al fondo svalutazione immateriale, si veda la nota 7
Operating (Loss) Income Operating loss for the three-months ended
June 30, 2022was $51.2 million, a decrease of $69.1 million, or 386.5%, as compared to an operating income of $17.9 millionfor the same period of 2021. The decrease was primarily driven by a goodwill and intangible impairment charge of $27.0 millionand lower gross profit associated with lower sales and lower gross margins during the period. Other, Net Other, net relates to the effect of exchange rate fluctuations with the U.S.and our foreign subsidiaries. Income Tax Expense Income tax expense includes U.S.and international income taxes, and interest and penalties on uncertain tax positions.
Le imposte sul reddito sono state le seguenti (in migliaia):
Table of Contents Three-Months Ended June 30, Change 2022 2021 $ % Income tax expense
$ 8,096 $ 3,438 $ 4,658135.5% Effective tax rate (15.5) % 19.7 %
Imposte sul reddito per il trimestre in scadenza
Aliquota fiscale effettiva delle attività continuative per il trimestre concluso
The effective tax rate from continuing operations for the three-month period ended
June 30, 2021was a result of the profit generated in the U.Soffset by the excess tax benefit related to stock-based compensation. (Loss) Income from Continuing Operations Loss from continuing operations was $60.2 millionfor the three-months ended June 30, 2022, or $(1.92)per diluted share, compared to income from continuing operations of $14.0 million, or $0.43per diluted share, for the three-months ended June 30, 2021. The decrease in income from continuing operations was primarily due to lower gross profit and higher operating expenses as discussed in more detail above. Net (Loss) Income Net loss was $60.2 millionfor the three-months ended June 30, 2022, compared to net income of $13.9 millionfor the three-months ended June 30, 2021. Net loss per diluted share was $(1.92)for the three-months ended June 30, 2022, compared to net income per diluted share of $0.43for the three-months ended June 30, 2021. 30 -------------------------------------------------------------------------------- Table of Contents LIQUIDITY AND CAPITAL RESOURCES Our future capital requirements may vary materially from those currently planned and will depend on many factors, including our levels of revenue, the timing and extent of spending on research and development efforts and other business initiatives, the expansion of sales and marketing activities, the timing of new product introductions, market acceptance of our products, and overall economic conditions. To the extent that current and anticipated future sources of liquidity are insufficient to fund our future business activities and requirements, we may be required to seek additional equity or debt financing. The sale of additional equity would result in additional dilution to our shareholders. The incurrence of debt financing would result in debt service obligations and the instruments governing such debt could provide for operating and financing covenants that would restrict our operations. As of June 30, 2022, we had $8.7 millionof cash, cash equivalents and restricted cash, and $35.1 millionwas available for borrowing under the ABL Revolving Facility, compared to $14.2 millionof cash, cash equivalents and restricted cash, and $65.8 millionavailable for borrowing under the ABL Revolving Facility as of March 31, 2022. We expect our cash, cash equivalents, restricted cash and amounts available for borrowing under our Credit Facility as of June 30, 2022, along with cash expected to be generated from operations, to be sufficient to fund our operating and capital requirements for at least twelve months from June 30, 2022. Cash used in operating activities was $6.0 millionfor the three-month period ended June 30, 2022, compared to cash used in operating activities of $28.2 millionfor the three-month period ended June 30, 2021. The decrease in cash flows from operating activities for the three-month period ended June 30, 2022as compared to the same period of 2021 was primarily due to changes in our operating assets and liabilities discussed below, offset by the decrease in net income. Trade receivables decreased to $27.5 millionas of June 30, 2022, compared to $61.5 millionas of March 31, 2022, primarily was due to lower sales and the timing of customer payments. Inventory was $103.9 millionas of June 30, 2022, compared to $111.2 millionas of March 31, 2022. The decrease in inventory was driven by sell-through and strategic demand planning as we balance on-hand inventory levels ahead of the fitness season. About 8% of inventory as of June 30, 2022was in-transit. Prepaid and other current assets decreased by $2.6 millionto $12.0 million, compared to $14.5 millionas of March 31, 2022, primarily due to decreases in prepaid marketing and prepaid insurance.
I debiti commerciali sono diminuiti di
Accrued liabilities decreased by
$5.0 millionto $24.4 millionas of June 30, 2022, compared to $29.4 millionas of March 31, 2022, primarily due to decreases in accrued off-site materials of $2.8 millionand decreases in accrued personnel expenses of $1.2 million. Cash used in investing activities of $3.4 millionfor the three-month period ended June 30, 2022was primarily due to capital purchases related to our digital platform. We anticipate spending between $12.0 millionand $14.0 millionin fiscal 2023 for digital platform enhancements, systems integration, and production tooling. Cash provided by financing activities of $7.1 millionfor the three-month period ended June 30, 2022was primarily related to proceeds from long-term debt offset by payments on long-term debt. 31 -------------------------------------------------------------------------------- Table of Contents Financing Arrangements On October 29, 2021, we amended our Credit Agreement dated January 31, 2020, with Wells Fargo Bank, National Associationand lenders from time to time party thereto ("the Lenders"). The Lenders agreed, among other things, to make available to us an asset-based revolving loan facility, subject to a borrowing base (the "ABL Revolving Facility"), and a term loan facility (the "Term Loan Facility" and together with the ABL Revolving Facility, the "Credit Facility"). The aggregate principal amount available under the ABL Revolving Facility is $100.0 million(the "Revolver"), subject to a borrowing base. The unamortized balance on the Term Loan was $11.5 million. The Credit Facility matures on October 29, 2026and repayment obligations under the Credit Agreement is secured by substantially all of our assets, with principal and interest amounts required to be paid as scheduled. As of June 30, 2022, outstanding borrowings totaled $37.2 million, with $9.8 millionand $27.4 millionunder our Term Loan Facility and Revolver, respectively. As of June 30, 2022, we were in compliance with the financial covenants of the Credit Agreement and $35.1 millionwas available for borrowing under the ABL Revolving Facility. Interest on the Revolver will accrue at the Secured Overnight Financing Rate ("SOFR") plus a margin of 1.86% to 2.36% (based on average quarterly availability) and interest on the Term Loan Facility will accrue at SOFR plus 4.61%. As of June 30, 2022, our interest rate was 3.65% for the Revolver and 6.40% for the Term Loan Facility.
La classificazione di bilancio dei prestiti nell'ambito della linea di credito del prestito revolving è stata stabilita in conformità con ASC 470, Debito.
Off-Balance Sheet Arrangements We have long lead times for inventory purchases and, therefore, must secure factory capacity from our vendors in advance. As of
June 30, 2022, we had approximately $34.5 million, compared to $39.8 millionas of March 31, 2022in non-cancellable market-based purchase obligations, primarily to secure additional factory capacity for inventory purchases in the next twelve months. Purchase obligations can vary from quarter-to-quarter and versus the same period in prior years due to a number of factors, including the amount of products that are shipped directly to Retail customer warehouses versus through Nautilus warehouses. The decrease in purchase obligations was primarily due to seasonality. In the ordinary course of business, we enter into agreements that require us to indemnify counterparties against third-party claims. These may include: agreements with vendors and suppliers, under which we may indemnify them against claims arising from our use of their products or services; agreements with customers, under which we may indemnify them against claims arising from their use or sale of our products; real estate and equipment leases, under which we may indemnify lessors against third-party claims relating to the use of their property; agreements with licensees or licensors, under which we may indemnify the licensee or licensor against claims arising from their use of our intellectual property or our use of their intellectual property; and agreements with parties to debt arrangements, under which we may indemnify them against claims relating to their participation in the transactions. The nature and terms of these indemnifications vary from contract to contract, and generally a maximum obligation is not stated. We hold insurance policies that mitigate potential losses arising from certain types of indemnifications. Management does not deem these obligations to be significant to our financial position, results of operations or cash flows, and therefore, no liabilities were recorded at June 30, 2022.
We expect our revenue from fitness equipment products to vary seasonally. Sales are typically strongest in our fiscal third quarter ending December and fiscal fourth quarter ending March and are generally weakest in our fiscal first quarter ending June and fiscal second quarter ending September. We believe that consumers tend to be involved in outdoor activities during the spring and summer months, including outdoor exercise, which impacts sales of indoor fitness equipment. This seasonality can have a significant effect on our inventory levels, working capital needs and resource utilization.
PRINCIPALI POLITICHE CONTABILI E STIME
Le nostre politiche contabili significative non sono cambiate a parte l'avviamento discusso nel nostro modulo finanziario 10-K per il 2022.
32 -------------------------------------------------------------------------------- Table of Contents NEW ACCOUNTING PRONOUNCEMENTS
Si veda la Nota 1 delle Note al Bilancio consolidato abbreviato inclusa nella Parte 1, Voce 1 per una trattazione dei recenti prospetti contabili.
© Edgar in linea, fonte