Black Diamond, Inc. (NASDAQ:BDE) Q4 2014 Earnings Conference Call - Final Transcript

Mar 16, 2015 • 05:00 pm ET

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Black Diamond, Inc. (NASDAQ:BDE) Q4 2014 Earnings Conference Call - Final Transcript

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Operator
operator

Good afternoon, everyone and thank you for participating in today's conference call to discuss Black Diamond Incorporated's Financial Results for the Fourth Quarter and Full Year ended December 31, 2014. Joining us today are Black Diamond Incorporated's CEO, Mr. Peter Metcalf, the Company's CFO, Mr. Aaron Kuehne, and the Company's Director of IR, Mr. Cody Slach. Before we go further, I would like to turn the call over to Mr. Slach, as he reads the Company's Safe Harbor statement within the meaning of Private Securities Litigation Reform Act of 1995 that provides important cautions regarding forward-looking statements.

Cody, please go ahead.

Executive
Cody Slach

Thanks, Jamie. (Forward-Looking Cautionary Statements) I would like to remind everyone that this call will be available for replay through March 30, starting at 8 P.M. Eastern tonight. A webcast replay will also be available via the link provided in today's press release as well as on the Company's website, at blackdiamond-inc.com. Any redistribution, retransmission or rebroadcast of this call in any way without the expressed written consent of Black Diamond, Inc. is strictly prohibited.

Now, I would like to turn the call over to the CEO of Black Diamond, Mr. Peter Metcalf. Peter?

Executive
Peter Metcalf

Thank you Cody and good afternoon everyone. At the close of market today, we issued a press release announcing our financial results for the fourth quarter and full year ended December 31, 2014. We are pleased to note that we reported results that came within the ranges of both our second half and full year 2014 revenue and gross margin guidance.

Since initiating our strategic pivot in late 2013, we have executed against nearly all of our objectives including the sale of Gregory, the focus on our core and fastest growing brands, and the development of a series of initiatives to improve margins and profitability. Strong fourth quarter results reflect this execution with 13% constant currency sales growth, a 160 basis point improvement in gross margin, and a 37% increase in adjusted EBITDA.

Black Diamond Apparel and POC continued to drive our growth. We also announced today that the Company engaged the financial advisory firms, Rothschild and Baird to lead the exploration of a full range of strategic alternatives for each of the company's brands, Black Diamond POC and PIEPS.

Before I comment further, Aaron Kuehne, our CFO will discuss our financial results for the fourth quarter. Aaron?

Executive
Aaron Kuehne

Thanks Peter and good afternoon everyone. The reported results we issued in today's press release are from continuing operations excluding the results of Gregory Mountain Products both for the three months and 12 months periods ended December 31. We divested Gregory on July 23, 2014.

Sales in the fourth quarter of 2014 increased 10% to $59.4 million compared to the same year ago quarter. The increase was primarily due to the continued growth of Black Diamond Apparel and an increase of POC's pre-season bookings as well as reorders of end season fall/winter products. Specifically POC had a strong fourth quarter and even stronger 2014 driven by growth in