K2’s marine and outdoor sales increase 10 percent

CARLSBAD, Calif. –Stearns marine and outdoor products and Shakespeare fishing tackle and monofilament generated sales of $68.2 million in the third quarter of 2004, up 10.5 percent from the comparable quarter in 2003, K2 Inc. reported in a statement today.

K2’s sales for the third quarter ended Sept. 30 were $333.5 million, an increase of 99 percent from $168.0 million in the prior year.

K2 said its marine and outdoor sales increases were driven by growth in Pflueger reels, marine antennas and waders and the addition of All-Star rods and ATV accessory product lines in the current period.

Overall, K2’s third quarter 2004 sales and diluted earnings per share of $0.26, exceeding previous guidance estimates of sales of $320 million and diluted earnings per share of $0.25.

Sales for the nine-month period ended Sept. 30 were $861.8 million, an increase of 64 percent over the 2003 comparable period. Operating income for the first nine months of 2004 was $59.5 million, a 124-percent increase over the 2003 comparable period, and net income was $30.1 million, a 225-percent increase over the first nine months of 2003.

"The third quarter marked another strong period for K2 and its portfolio of leading brands,” said Richard Heckmann, chairman and CEO. “We generated organic sales growth net of acquisitions of nearly 12 percent in the quarter, driven principally by growth in our winter products brands. Additionally, our trend of improved profitability continued as reflected in higher margins and net income. We are moving swiftly to integrate recent acquisitions, and the combination of our scalable infrastructure, leading brands and strong balance sheet position us well for future growth."

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