Q4 2020 Sturm Ruger & Company Inc Earnings Call
Ladies and gentlemen, thank you for standing by and welcome to the Sturm Ruger fourth quarter 2020 earnings Conference call.
At this time all participant lines are in listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During this session you will need to press star one on your telephone. Please be advised for today's conference is being recorded.
Any further assistance. Please press star Zero I would now like to hand, the conference over to your speaker of the day, Chris Goulart, Chief Executive Officer. Thank you. Please go ahead Sir.
Good morning, and welcome to the Sturm Ruger <unk> company year end 2020 conference call.
I would like to ask Kevin Reid, our general counsel to read the caution on forward looking statements then Tom Dineen, our Chief Financial Officer will give an overview of the fourth quarter and 2020 financial results and then I will discuss our operations and the state of the market.
After that we'll get to your questions Kevin.
Sure Chris.
We want to remind everyone that statements made in the course of this meeting the state the companys or managements intentions hopes beliefs expectations or predictions for the future are forward looking statements. It is important to note that the company's actual results could differ materially from those projected in such forward looking statements additional information concerning factors that could cause.
Actual results to differ materially from those in the forward looking statements is contained from time to time in the company's SEC filings, including but not limited to the company's reports on form 10-K for the year ended December 31, 2020 and of course on the forms 10-Q for the first second and third quarters for 2020 copper.
Copies of these documents may be obtained by contacting the company or the SEC or are available on the company website at Ruger Dot com forged slashed corporate or of course at the SEC website at SEC Gov. We do reference non-GAAP EBITDA. Please note that the reconciliation of GAAP net income to non-GAAP EBITDA can be found in our form 10-K for the year ended December <unk>.
31, 2020, and our forms 10-Q for the first three quarters for 2020, which also are posted on our website.
Furthermore, the company disclaims all responsibility to update forward looking statements Chris.
Yes.
Thank you Kevin now Tom will discuss the company's 2020 results.
Tom.
Thanks, Chris.
For 2020, net sales were $568 $9 million and diluted earnings were $5 nine per share.
For 2019, net sales were $410.5 million.
And diluted earnings were $1 82 per share.
For the fourth quarter of 2020.
Net sales were $169 $3 million and diluted earnings were $1 78 per share.
For the corresponding period in 2019 net.
Net sales for our $105 $1 million.
And diluted earnings were <unk> 46 per share.
The substantial increase in profitability for the fourth quarter and the full year is attributable to the significant increase in sales 61 per cent for the fourth quarter and 39% for the full year.
And the reduction in promotional and rebate activity in 2020, particularly in the latter half of the year.
The balance sheet.
At December 31, 2020, our cash and short term investments, which are invested in U S. T bills totaled $141 $2 million.
Our current ratio was two nine to one and we have no debt.
At December 31, 2020.
Stockholders' equity was $264 $7 million, which equates to a book value of $15 13 per share.
Of which $8 seven per share was cash and short term investments.
Cash flows.
In 2020, we generated $144 million of cash from operations.
We reinvested $24 million of that back into the company in the form of capital expenditures primarily related to new products. In addition, the company acquired substantially all of the Marlin firearms assets for $28 million in November of 2020.
Which included machinery and equipment tooling fixtures and inventory.
We estimate that 2021 capital expenditures will be approximately $20 million predominantly related to new product development.
Our ability to shift manufacturing equipment between sales and between facilities improves overall utilization and allows for a reduced capital investment.
Cash returned to shareholders.
In 2020, we returned $114 million to our shareholders through the payment of dividends.
Reflecting our customary quarterly dividends and a special dividend of $5 per share that was paid in August.
Our board of directors declared a 71 cent per share quarterly dividend for shareholders of record as of March 12, 2021 payable on March 26 2021.
As a reminder, our quarterly dividend is approximately 40 per cent of net income and therefore varies quarter to quarter.
These dividends add up.
Since 2015, the company has paid $225 million in dividends to our shareholders just less than $13 per share.
Additionally, during that time, we've repurchased more than one 7 million shares of our stock for $84 million at an average price of $40 36 per share.
That's the financial update for 2020, Chris.
Thanks, Tom.
Demand the tremendous sales growth and profitability in 2020 was driven by the historic surge in consumer demand that began late in the first quarter and continued throughout the year.
The estimated sell through of the company's products from the independent distributors to retailers in 2020.
Increased 44% from 2019.
For the same period, the national instant criminal background check system for Nyx background checks as adjusted by the National Shooting Sports Foundation.
Increased 60%.
These substantial increases have likely been constrained due to the limited available inventory in the distribution channel.
New product development.
<unk> thousand 20, new product sales represented $111 million or 22% of firearms sales compared to $102 million or 26% of firearms sales in 2019.
We remain committed to new product development as evidenced by our strong roster of our new products in 2020, which included.
The extremely popular Ruger 57 pistol, which was awarded the 2020 caliber award for best overall, new product by the professional outdoor media Association and conduction in conjunction with the N. A S. G W.
The LCP II in 22 long rifle, which is based on the Venerable LCP platforms and utilizes our light rack system for easier slide manipulation and reduced recourse.
The wrangler revolver, our latest take on the classic single action revolver, which has surpassed our wildest expectations and shows no signs of slowing down.
And the PC charger and a 556 pistol.
Pistol configurations based on established rifle platforms that are found widespread popularity.
As a reminder, derivatives and product line extensions of mature product families are not included in our new product sales calculation.
But they provide great value to our distributors retailers and our loyal Ruger consumers.
Despite the ferocious pace of business, our engineering teams continue to develop exciting new platforms.
For a variety of new products.
I look forward to providing updates when we get closer to launching these innovative new products in the future.
Production and inventory.
The incredible surge in demand outstripped, our production for most of 2020.
As a result, the combined inventories in our warehouses and at our distributors decreased 290000 units during 2020.
And the available information suggests that retailer inventory of Ruger as well as most other firearms brands.
<unk> also remains largely depleted.
We are working hard to replenish inventories throughout the distribution channel as quickly as possible. So consumers can purchase the ruger firearms that they desire.
With the onset of the COVID-19 pandemic, we suspended hiring from March until June.
Once hiring resumed we remain cautious and limited the rate at which we're bringing new folks on board.
Mid summer, we began to accelerate our hiring process and as a result since the middle of 2020, our work force has been strengthened by 250 folks.
This allowed us to realize a 30% increase in production during the latter half of the year.
Marlin.
As many of you are aware in November we purchased substantially all of the Marlin assets for $28 $3 million.
Since that time, we move all of the inventory and manufacturing equipment tooling fixtures engages to our facilities, which was no small task.
We're still in the process of evaluating these assets reviewing the product designs and determining the best manufacturing process for each component part.
We have started to establish a manufacturing sales that will produce the Marlin rifles and plan on shipping the first Ruger made Marlin lever action rifles from our made in facility in late 2021.
Like many of you I've been a fan of Marlin products for as long as I can remember we have heard from hundreds of the Marlin faithful and countless firearms consumers who are excited as excited as we are to have this legend Gary brand as part of Ruger.
COVID-19.
As we are all too well aware of the COVID-19 pandemic continues to cast its wall Shadow.
Since its onset in March we have remained proactive in maintaining the health and safety of our employees and mitigating its impact on our business.
By providing all hourly employees with an additional two weeks of paid time off in 2020, and providing an additional week in 2021.
Encouraging employees to continue to work remotely wherever possible and maintaining social distancing throughout each manufacturing facility, including in every manufacturing cell.
Confidentially communicating with and assisting employees with potential health issues through our dedicated facility nurses.
Restricting visitor access to minimize the introduction of new people to the factory environment.
Implementing additional cleaning sanitizing, and other health and safety processes, including improved ventilation to maintain a clean and safe workplace.
Providing all employees with multiple face mask coverings, and other personal protective equipment and mandated their use at all times at our facilities.
Issuing periodic guidance and reminders to all associates directly to their phones, where possible to encourage them to engage in safe and responsible behaviors.
And manufacturing and donating personal protective equipment to local hospitals health care facilities, and police and fire departments and our local communities.
These actions, which cost approximately $3 $6 million in 2020 mitigated the adverse financial impact on our business, resulting from COVID-19.
We also experienced expense reductions and deferrals in certain areas of our business, including reductions or delays in sponsorships and advertising reduced conference and tradeshow participation costs and reduced travel expenditures. These.
These expense reductions and deferrals approximated $2 $9 million in 2020.
The future impact of COVID-19 remains unknown, we estimate the COVID-19 related costs will total between one five and $3 million in 2021.
Included in this estimate is at $200 bonus for every employee who receives a COVID-19 vaccination.
Our financial strength, evidenced by our debt free balance sheet provides financial security and flexibility as we continue to manage through Covid and focus on our long term goals and creation of shareholder value.
I would be remiss, if I did not mention the extraordinary work of our COVID-19 task force and the leadership teams at all of our facilities.
They have risen to the daily challenges posed by the pandemic and have worked tirelessly keeping our folks healthy and our facilities clean.
I could not be prouder of everyone's performance truly was a team effort.
'twenty 'twenty one I'm excited as we head into 2021, we look forward to launching new products that are sure to create excitement amongst shooters and as I mentioned a few moments ago. We are excited to start shipping Marla lever action rifles in late 2021.
And the low inventory levels in the channel provide further opportunity for us.
Those are the highlights of 2020, operator may we have the first question.
Okay.
Thank you as a reminder to ask a question you will need to press star one of your telephone to withdraw your question press the pound key please standby, while we compile the Q&A roster.
Our first question comes from Robert <unk> with agents Youre line is open.
Thanks, Good morning, everyone.
Chris I Wonder if you could just provide a little more granularity on the increased head count of $2 50.
You know I always see a very impressive increase in production levels, 30% for the second half for the year were those 250 employees primarily production.
Also is there.
Some of that for Marlin or is that hiring increase still to come for later this year and finally, if I could ask one more.
And our product quality has been so important to you over the years and as you add people so quickly.
You know how does that look into share of Covid I just wonder if you could talk to the point of maintaining product quality training for all of these new employees coming on at one thanks very much.
Thanks, Rommel good questions when it relates to the hiring efforts.
Primarily our hourly folks dedicated to production there have been some salary folks that we added.
And some some of those warrants associated with the Marlin acquisition, but most of those folks were intended to help us increase production at all three of our primary facilities.
Newport, New Hampshire, Prescott, Arizona in maiden North Carolina, So we had hiring activities going on across all those factories and frankly those hiring activities are continuing today.
And that kind of transitions into one of your other questions was how do you know as it relates to quality.
Quality is very very important to us and one of the things that we need to do is adequately train our folks when they join us.
That present with COVID-19, we were faced with additional challenges there. So we went to things like using headsets and microphones.
Within the factory because normally you'd be in a factory environment you'd be shoulder to shoulder.
Working to learn a new job in this case, we needed to maintain our socially distance separation and so headsets microphones a lot of creative and.
New ideas that we never thought we'd be faced with we are used to help bring our associates up to speed.
And the quality metric is one that really is near and dear to our heart.
We looked at we look actively at things like our cost of quality in terms of scrap rates our yield on the production lines and then we also look at customer with tariffs and then.
The subjective side of that.
As we have a lot of communication with our customer base. We also have the ask the CEO.
Section on our website and believe me if we if we've made a mistake on quality I hear directly from our customers and we take action and so we prefer to of course, if folks start with our customer service team. We've got what we considered the best customer service organization in the in the industry.
And they do a great job, taking care of our customers, but something's wrong, let us know, let me know and we'll take care.
Great Thanks, Chris and congrats on the quarter.
Thanks Rommel.
Yeah.
Thank you. Our next question comes from Mark Smith with Lake Street Capital. Your line is open.
Hi, guys.
Wanted to start with ESPN price, our ASP was up especially as we look at the new orders you know how much of this is price increases versus just mix.
Hi, Mark.
Good question, we did take a price increase a modest price increase back at the beginning of October.
This past year.
So some of that in Q4 is related to that price increase but the majority of it is not having the promotions in the mix, particularly in the back half of 2020, we still had some promotions going on in the front half of 2020.
But that's primarily the.
The impact there as well as the acceptance and I'll say the desirability of some of our.
Higher priced products as they came online like the Ruger 50, 756, et cetera, which carry a higher price point for example than a gun like the LCP or the wrangler.
Perfect and and as you talked about promotional environment and stuff you know selling expense came up a little bit this quarter in dollars still low as a percent of sales.
How do you kind of view that line going forward you know at what point do you think you've really you may need to spend a little bit more.
Well the biggest thing there is you look at the SG&A lines.
In the sales line you have our shipping expenses, which obviously have increased.
Primarily with the volume and then in the in the <unk>.
The rest of the SG&A you also have incentive comp, which is part of it.
We have not added to our sales force our sales force has been doing a great job throughout the year.
Staying in touch with their customers from the phone and emails and texts as we as you would imagine.
But.
Frankly, they're not traveling so they're not making the calls on their distributors and retailers like they normally would.
Some of the promotions have been scaled back because of course retailers are not anxious to bring.
Customers in a large crowd into their store.
And so that's probably the biggest impact, but the sales force them to do a great job trying to keep up in this COVID-19 environment.
Okay, and then as we look at the accessories business, we don't talk about that very often but.
Accessories, certainly had a good year any insight you can give us into items or categories that are selling well and potentially any impact that that business had on your gross profit margin.
Well clearly the accessories are part of our business did very well this year.
That's we break that down really into three categories, we look at the.
The direct sale to our distributors as well as the sales through some of the large volume.
Direct retail merchants like midway Brown ALS and.
And we also haven't really Shabu component all three of those did exceptionally well this year. The biggest contributor to that typically is magazine sales. The sale of magazines. You know typically goes up with the sale of firearms that take those magazines, but we've also seen a steady increase in the magazine business and the other accessories as well once they come onto.
Satellite shop, Ruger or to our distributors looking at for magazines, we've we did pretty well with other sales in the accessory category.
Perfect.
Instead as we look at gross profit margin again that was really strong here, especially in the in the quarter how sustainable.
Is this level of gross profit margin as we look forward.
Well I mean, there's a lot of that Inc.
Increased margin of course is related to the increased volume.
<unk> mix and the lack of promotions are really the three three there you know the biggest two being volume and promotions. So we kind of welcome this promotional.
Light environment. We're in now we haven't forgotten how to promote and we're ready to begin things like Ruger days, which our customers love to go to it at retail throughout the country.
But that'll be the biggest thing is you know managing as if and when the demand changes managing that I'd like to think we do exceptionally well with that I think most of you know we review our production rate.
On a line by line basis down to D. C. S. P. One O one revolver.
L C P et cetera, and we do that every two weeks and we look very closely not at our order backlog, but we look at what's selling from our distributors to our retailers and those are some of the key indicators of when we need to change production either up or down and in this case, obviously most of those lines are under tremendous.
Demand pressure to increase production and we're going as fast as we can bringing in new folks also working through some challenges in the supply chain that we're seeing.
But.
Our teams have done a phenomenal job doing that and I think will be a good good shape going forward whether business sustained at these levels or for throttles back.
Perfect day, and I think the last one for me.
And you just talked about it a little bit here as we look at capacity.
Units produced in units shipped up for.
Pretty strong growth even sequentially here.
You know do you feel like you know with these added people that you're now topped out as far as production or is there still some opportunities where you can lever that a little bit higher.
We're still hiring and there still are some lines that are.
Not at their Max physical capacity and we've got some new products coming on that will be additive to our current rates. So as long as those come to fruition, we should be in good shape. So we're going to continue to hire until it doesn't make sense to we will continue to monitor those production rates every two weeks, but right now.
At least today, we're still actively hiring and still have.
The ability to move forward, but again, we keep a close eye on that and keep a close eye on what's happening with our distributors.
Excellent sounds great. Thank you guys.
Thank you once again, ladies and gentlemen, if you wish to ask a question at this time. Please press Star then one on you touched on telephone.
Our next question comes from Ryan Hamilton with Morgan Dempsey. Your line is open.
Good morning, everyone.
Hi, Ryan.
Last quarter, you touched I asked a question about how youre going to categorize Marlin products. If they were going to end up in your new sales product.
Your new sales category is there is that the case.
So how are you going to do it.
Yeah, it will be right.
Brian We are you know Marlin is a phenomenal opportunity, but it's also a phenomenal undertaking for US we've got a we had over 100 tractor trailer loads from three of the three of their form of locations from the.
For the Remington folks that we moved primarily into our made in facility and an adjacent warehouse, we moved the woodworking equipment up to our facility in New Hampshire.
And we will be trading from a new product categorization standpoint, we'll be treating that as new products from Ruger and the team is doing a phenomenal job as we outlined.
Going through part by part.
Making sure we understand how it was made and looking at what's the best way to make it going for.
So it's been it's been a phenomenal effort by the team.
With the extraction of the equipment out of the former facilities and moving into the Ruger facilities and the lines are taking shape nicely, but theres still a lot of work ahead to make sure we produce quality quality rifles. The focus will be on the center fire lever action rifles initially.
The models 18, 90 for 18 95 in the $3 36, and then <unk>.
Following that will be things like the for example, the model 60 semi automatic Rob rimfire 'twenty, two but right now our focus is on the center fire lever action rifles scanner data.
Sounds good but could you make the argument that it.
For 2020, new product sales of 22% may appear a little low just because you were clearing out more mature inventory as well.
Well it also has to do.
Ryan with how we track them, because we give new products only a two year runway run rate.
That calculation so they fall off our calculation internally at every quarter we have.
New ones coming in hopefully, but we also have.
Other products aging out so 2020 gave us the opportunity where we have a product like the wrangler to maximize the number of units shipped and that's one of our new products, but again, that's a lower dollar amount.
Per unit, Alright, and then other ones like I said, it's primarily which ones fall off so it's more in 2020, we saw most of those lives running flat out.
So and that's where we are today.
Sounds good.
A question about S P.
Could you give us a.
And then October price increase maybe the magnitude.
Yes, it was about 3% across the board to our wholesalers.
So it wasn't a.
It wasn't egregious then it was.
That's in line with our.
Our past practices typically it's a few months earlier.
But it's in line with the price for price increases we've taken historically.
Sounds good and then.
You also.
Briefly touched on.
Supply chain challenges could you could you give us a little color on that maybe commodity inflation what else Youre seeing.
Yes, I think in terms of raw materials and commodity inflation, we're fortunate our strong balance sheet allows us to.
To maintain the raw raw material inventories that we need to.
You know, we typically will lock in with contracts to try to control some of those price issues. It's really been suppliers issues a lot of it has to do sometimes with COVID-19 issues at suppliers.
Some of our suppliers and vendors are smaller and when they have a COVID-19 issue. It can shut them down some of them relate to.
Freight and transportation as a as it relates to some of the weather patterns. We're seeing of late but I'd say, primarily it's the garden variety of supply chain issues as you know manufacturing in the U S starts to ramp back up and so you know many many of our suppliers supply other gun manufacturers. So when our business is strong their business is strong.
As well so so that's primarily where we're seeing some of those issues.
Understood.
You talked about 100 tractor trailer loads.
From Marlin could you give us a sense as far as you.
You know, maybe a time frame when.
The acquisition will be fully integrated into your current lines and.
And expanded.
Well, it's going to be over a course of time and then we got the first priority of business is getting.
Getting up and up and running like I said on the center-fire lever action guns down and made it and there will be growing that line, we inherited a lot of equipment that needed. Some additional maintenance and additional work, we're going through that with a lot of technicians and maintenance folks right now.
We're fortunate to have some great mechanical engineers going through again on a part by part basis.
We did hire a handful of folks from Remington, who were familiar with some of those products and that's helped us.
And so it'll be it'll continue to evolve the I expect the first products will be all out off the line in Q4 of this year and then we'll continue to flesh that out I remember those model numbers that I mentioned.
336, It was 18 90, fives and 18 90 for its.
Really that's just the start there's a lot more to Marlin, yes, those three models and so we think over time will continue to grow that will continue to listen to customers.
And expand.
Both the Sapphire lever action category likely the model 60, 22 semi automatic rimfire and we'll see where it goes from there.
Sounds good and then I know.
You don't generally are you don't touch on.
Monthly sales, but could you give us just a sense of the cadence through the quarter and maybe if youre seeing any signs that demand may be.
You know lessening to any extent could you could you touch on that for us. Please.
Sure you know as you know.
We don't split it out by month, but I will tell you that.
We did not see any let up in demand throughout.
Throughout the quarter.
The cadence was really driven by our ability to ramp production based on hiring.
New people are able to join us and become productive on the shop floor, we were able to increase production and continue to ramp.
So that's primarily where what we looked at it as a cadence if you will and you know.
I think that's where we are today.
Sounds good thank you very much and congrats on effective quarter Andy here.
Thank you. Thank you.
Thank you once again, ladies and gentlemen, if you wish to ask a question at this time. Please press Star then one are you touched on telephone.
Our next question comes from Paul Safferstein with first New York Your line is open.
Hi, good morning congratulations.
It isn't something that we are.
My question.
You are.
Kind of follow ups.
I'm kind of taking a different spend if you will first of all on the hiring can you talk about.
The you know the.
Pace of hiring being 30 per cent increase in production relative to.
Background checks being you know kind of like the 60 per cent.
And how you think about permanent hiring versus.
The ebbs and flows of potentially a demand spike that we're in the middle of.
And to that end.
Looking at the fourth quarter kind of run rating that going into 2021, it would seem as though.
You know you could do well over $600 million revenue I know if you have any comments around kind of forward looking out how 2021 is shaping up.
The inability of demand and how that is relative to hiring.
And then and just lastly on.
Your price increase comment is that an annual event or is it just kind of random. Thank you.
Thank you Paul good questions.
First as it relates to hiring I mean hiring as we noted in the remarks earlier.
No we didnt turn hiring back on until June our primary business. This year has been trying to keep our folks safe we've got three.
Major factories as well as our metal injection molding facility out in Missouri, and all of those we have strict safety protocols as far as you know how our people are doing business do folks et cetera. So once we turn our hiring back on.
And certainly we while hiring was frozen we certainly this sales we understand that and while we're ramping up.
We net sales so I mean, that's just the nature of the Beast of trying to make sure we're going going forward in a.
Professional and.
I'll say carrying that are taking care of our folks first and foremost and that that was our goal and so I'm exceptionally proud of how the folks did it.
The hiring efforts continue continued throughout the back half for the year as well as today.
And so we've been chasing that demand really since the end of Q1.
There's still a lot of opportunity to replenish inventory.
And you know as we.
We look at those empty empty shelves at retail and the empty racks at our wholesalers as well as our inventory we know there's some some transition as we'll be able to replenish that inventory over time.
The other thing is as far as you know all of our folks are permanent hires at one time in the company history, we did use up.
Temp labor we found over time that are permanent hires were better for Ruger.
And so these folks are permanent hires but we do as you would expect we suffer attrition.
And so we hope that we will be able to moderate any changes in demand if we needed to through attrition.
And then I think your last question was on the price increase.
Yeah, I'll say theres never a it's not an automatic but I would say over the last couple of years, we've typically taken a price increase that takes effect.
January 1st some cases, sometimes it's taken effect December one.
And then this year it took us took effect.
On or about the first of October, but that's about it in terms of pricing and like I said, it's a it's not a it's an and.
As we look at commodity prices that we look at our.
Our need to maintain competitive nature of our business. We factor all of that in typically we will do it based on certain product lines. In this case it was across the board again fairly modest so I would tell you that some of the price increases that we're seeing at retail.
Not as a result of that it's really the result of supply and demand and retailers potentially raising their prices.
Understood. Thank you.
And so.
Relative to the Golden registration for I don't know, what you can say about 'twenty 'twenty one but.
Uh huh.
How should I think about kind of volume and ultimately revenue.
Going into this year, given such strong registration numbers I don't know.
Speak to how registrations track revenues overtime.
And one new question is given the special dividend from the amount of profits in the payout ratio currently how do you think about special dividends going forward. Thank you.
Yeah.
Well, Paul I assume you're talking about the next numbers rather than registrations, but the the knicks numbers or the adjusted next week, which will put out by our trade Association the National shooting Sports Foundation.
Those refer to the E. The instant checks that are done at retail typically associated with the purchase of a fire the adjustment comes in to adjust out.
Certain states that have.
High levels of background checks conducted for permits and things of that nature.
It's an okay metric in okay.
To use that to look at overall levels of demand, it's tough sometimes to put a finite number on it with a direct correlation.
In terms of things like market share and demand. We also use things like the federal excise tax collections that go along with every new firearm put into commerce commerce and I think they are a good indicator of overall demand, but remember that things like used guns go into the nix checks as well so when he used gun is.
Sold at a retailer and potentially another one was bought or just perhaps I should say they sold it and for cash and that got us resold that you've got is also generates a nix checks. So you have to look at those with everything else kind of a holistic approach to what's going on in the marketplace, which we like to do with our sales force to really stay in touch with our key retailers.
So we know what's happening in terms of that demand. So right now as you likely saw January was exceptionally strong another record breaking.
In terms of the mix data that we saw from the.
The F B I raw data as well as the adjusted mix.
So that's January was strong and you know as.
As we go into 2021.
We don't make forward looking comments as far as what's the what's going to happen.
Other than a very very very proud of the team we have here in place at Ruger.
And so regardless of what the market throws at US I think we're gonna be in good shape those low inventory levels, we mentioned that'll provide some opportunities as we gradually replenish the shelves at all levels for the channel. So I think we'll be in good shape again, regardless of what the market throws at us.
Right.
And any comments about how you're thinking about special dividends.
Sorry, I forgot that one a good point again.
Any forward looking guidance there really are our approach has not changed our approach to.
Shareholder value and how we manage the balance sheet remains the same.
Every year, we put a bunch of that capital to work in terms of our capex at our factories. Some level of it is for normal maintenance, but most of that goes into new products and as Tom noted I think we've got a estimating about 20 million plan for this year.
Most of that is associated with a planned new products, which is great.
Use of course acquisition, we were able to do the Marlin acquisition.
For $28 3 million out of cash and.
Our strong balance sheet allows us to do that and be opportunistic.
And then returning share cash to shareholders, we had the $5 a share special dividend that we did.
Back in August September time period, and that's also a good way to return value to shareholders. The other way is through share buyback.
We have a significant amount still remaining on our authorization to repurchase shares if it makes sense and at the right at the right time at the right price that could be a factor as well so we like to keep our powder dry.
As Tom mentioned, we've got a very strong balance sheet, no debt and $140 million of cash. So we're in good shape to take advantage of any any of those opportunities.
Understood great. Thank you so much.
Thank you Paul.
Thank you. Our next question comes from Gavin Richey with Railroad Ranch. Your line is open.
Yeah.
Hello, just one quick question have you done any analysis on if the administration wants to move forward with the banning of.
One part importation and you had to source locally what if any gross margin impact that will have.
Well as most of our customers know Ruger products for 100 per cent American made so we frankly don't have any overseas suppliers, so I'm not worried about that impact.
We're very vertically integrated within our factories, we have a little woodshop, we take steel ingots that we source.
In the U S. We make.
We have our own investment casting foundry, we ever own metal injection molding facility, our own wood shop. So.
So I'm very very comfortable with that there may be a few items that are.
That could impact us on our accessories business that are imported in nature, but realistically I don't think we'd have any effect.
Great. Thanks.
Thank you and I'm currently showing no further questions at this time I'd like to turn the call back over to Chris Conway for closing remarks.
Thank you.
In closing I would like to thank you for your continued interest in group.
And I would like to thank our loyal customers in the 1800 hard working members of the Ruger team, who design and manufacture rugged and reliable firearms every day in our American factories.
Hope you'll be able to join us at our virtual 2021 annual meeting on Wednesday may 12th further details will become available in early April.
Very much.
Ladies and gentlemen, this concludes today's conference call. Thank you for participating you may now disconnect.
[music].
Sure.
[music].
Okay.
Yes.
From that.