t h e s p i r i t o f a d v e n t u r e
2001 annual report
Johnson Outdoors Inc.
designs, manufactures and
markets outdoor recreation
products in four businesses:
Watercraft, Motors, Diving,
and Outdoor Equipment.
More than 1,400 employees
work in thirty locations
worldwide.
Watercraft
Old Town
Canoes and kayaks
Necky
Kayaks
Leisure Life
Canoes, pedal boats, kayaks,
deck boats and tenders
Ocean Kayak
Sit-on-top kayaks
Escape
Sailboats
Carlisle
Paddles and oars
Motors
Minn Kota
Electric boat motors, power
equipment and accessories
Airguide
Speedometers, marine and
automotive compasses and
weather instruments
N e t S a l e s
19%
Extrasport and Swiftwater
Personal floatation devices
N e t S a l e s
25%
Dimension
Kayaks
Pacific Kayak
Kayaks
B U S I N E S S P R O F I L E
Outdoor Equipment
Diving
Scubapro
Regulators, buoyancy
compensators, masks, fins,
wet and dry suits, gloves, dive
lights and other accessories
Aladin
Premium dive computers
Uwatec
Dive computers and other
electronic instruments
SnorkelPro
Masks, fins and snorkels
N e t S a l e s
23%
Eureka!
Camping tents,
accessories and military
and commercial tents
N e t S a l e s
33%
Camp Trails
Backpacks and accessories
Silva
Field compasses
Jack Wolfskin
Outdoor clothing, travel
gear, footwear, accessories,
camping tents, backpacks
and sleeping bags
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
Summary Financial Information1
Johnson Outdoors Inc.
(thousands, except per share data)
1999
2000
2001
% change
Operating Results
Net sales
Gross profit
Operating profit
Diluted earnings
per common share
Diluted average common
$310,198
$354,889
$345,637
125,774
19,513
142,813
136,703
24,719
15,718
(36)%
(3)%
(4)%
$0.72
$1.03
$0.44
(57)%
shares outstanding
8,108
8,130
8,170
Capitalization
Total debt
$122,071
$105,319
$97,535
Shareholders’ equity
127,178
100,832
105,779
Total debt to total capital
49.0%
51.1%
48.0%
1
Table of Contents
1 Summary Financial Information
2 Letter to Shareholders
4 Our Management Team
6 Watercraft
8 Motors
10 Diving
12 Outdoor Equipment
14 Outdoor Equipment – Europe
16 Product Gallery
• Form 10-K
Inside Back Cover
Directors and Officers
Shareholders’ Information
L
E
T
T
E R
T O S H A R E H O L D E R S
Our research shows Johnson Outdoors outperformed the competition in
2001. And throughout the year we took decisive action to continue building
a foundation for long-term growth.
Helen P. Johnson-Leipold
Chairman and Chief Executive Officer
Diving, Outdoor Equipment
Group and Jack Wolfskin
produced steady profits,
while Watercraft and Motors
faced the challenge of market
contractions. Economic
conditions, combined with
the impact of September 11,
affected all our North
American businesses except
for military tents, which saw
both strong sales and profits.
Considering the market con-
tractions, Johnson Outdoors
fared better than the competi-
tion. All our key brands out-
performed their categories and
gained share from competitors,
thanks to strong new products
introduced throughout the
year. And we’re also excited
about new products as we look
forward to our 2002 season.
All of our brands earned rave
reviews on their new products
during the August 2001
Outdoor Retailer show. These
positives, plus our core
strengths, make us confident
Johnson Outdoors can weather
the current economic cycle.
2001 Results
This year’s slowing economy
and cold spring and summer,
combined with operational
challenges in Watercraft,
affected both our top-line and
bottom-line performance.
As we managed the external
challenges, we also acceler-
ated the pace of change in
Watercraft and are already
seeing positive results.
The Outdoor Equipment
Group’s military tent and
Jack Wolfskin sales nearly
offset Watercraft’s and Motors’
lower-than-expected sales.
Fiscal 2001 sales and gross
profit margin stayed essentially
level, at $345.6 million and
40%, respectively. Operating
profit declined $9 million,
or 36%, primarily due to
Watercraft’s margin shortfalls.
Earnings per diluted share
from continuing operations
decreased 57%, to $0.44.
Diving continued its exciting
turnaround, gaining U.S.
market share despite poor
industry conditions. Sales
dropped 3%, to $80.5 mil-
lion, but expense cuts such
as closing the Uwaplast
injection molding operation
increased operating profit
7%, to $11.6 million.
Strong new products for
2002 include the first wire-
less dive computer.
Watercraft’s operating profit
decreased 87%. Poor weather
flattened industry sales. We
had already begun increasing
plant efficiency and improv-
ing distribution. This year
we stepped up the pace,
consolidating facilities to
2
empowered companies guided
and served by central vision,
strategies and resources.
further strengthening our
innovation capabilities.
improve return on assets—
folding Necky manufacturing
into Ocean Kayak; moving
Escape operations into Old
Town; and consolidating
ten warehouses into one.
This process will continue
in 2002. We bolstered our
innovation capabilities and
our international presence
by acquiring Fibrekraft
Manufacturers Ltd., a New
Zealand manufacturer of
high-quality paddles, hel-
mets and other accessories.
Watercraft continues to offer
great growth potential with
a strong market presence
and terrific brands.
Outdoor Equipment Group
increased sales 10%, to
$114.9 million. Operating
profit rose 47%, driven by
strong military tent sales
and solid progress at Jack
Wolfskin, where sales rose
10% as we opened eleven
more stores in Europe.
OEG’s image-building prod-
ucts for 2002 include a con-
sumer version of the Eureka!
Fifth Season EXO tent, cho-
sen by an elite team climbing
Mount Everest.
Motors gained market share
but saw sales drop 16%, to
$64 million, due to weak
industry conditions and the
bankruptcy of a major cus-
tomer. Operating profit
declined 30%, excluding
$2.5 million in goodwill
impairment related to dis-
continuing a small brand
within the Motors business.
Our new Riptide saltwater
motors, with the category’s
first-ever three-year warranty,
offer a major growth oppor-
tunity for 2002.
Long-term business model
The business success model
we introduced in 1999
continues to guide us in
creating long-term growth.
Its components are:
Effective portfolio management
Continually assess current
businesses and potential
acquisitions against our stra-
tegic criteria: being #1 or #2
in the market, in a category
that rewards innovation, with
strong growth potential.
Network operation model
Build a strong “network” of
Expanding markets
Be a catalyst for growth—for
us, for our customers, and for
the category itself—through
product innovation, leading-
edge marketing, and under-
standing consumers and markets
better than our competitors.
Innovation leadership
Continue to build our posi-
tion as the market innovation
leader with breakthrough new
products that address consumer
needs, differentiate us from
competitors and advance our
strong brands.
Strategies for 2002
1. Address first things first. In
2002 we’ll focus on targeted
growth and strengthening
internal operations. That
includes analyzing asset use,
as part of portfolio manage-
ment; standardizing business
controls and processes, as we
refine our network model;
focusing on healthy growth
rather than quick hits to
expand our markets; and
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
sales in Europe and Asia
Pacific, leveraging current
capabilities to minimize incre-
mental expense. Jack Wolfskin
will continue expanding in
Northern Europe.
- Category extensions, using
our capabilities to enter new
segments.
- Better tactical execution,
drawing on the skills of our
new management team mem-
bers to increase marketing and
sales sophistication.
Johnson Outdoors offers many
strengths: leading market posi-
tions, powerful brand names,
superior innovation, outstand-
ing employees—and now, a
well-rounded management
team, introduced on the fol-
lowing pages. I thank you for
your support over the past year
and invite you to continue
with us in the spirit of adven-
ture that is Johnson Outdoors.
2. Simplify, but don’t sacrifice.
We’re streamlining our
organization, our facilities,
our SKUs—all to become
leaner, faster and better able
to handle growth. But we
will not jeopardize our long-
term growth initiatives. Our
focus is on conservative
budgeting and smart choices
that will enhance flexibility
in an uncertain market.
3. Keep an eye on opportunity.
While we’re building the
infrastructure to take Johnson
Outdoors to the next level,
we can’t ignore growth oppor-
tunities. Acquisitions remain
possible, but we’re emphasiz-
ing organic growth through:
- New product development
in current segments, using
direct consumer input and
trend information to develop
products with a meaningful
point of difference.
- Geographic expansion, par-
ticularly in Europe. This year
we plan to increase Watercraft
Helen P. Johnson-Leipold
Chairman and
Chief Executive Officer
3
M E E T O U R M A N A G E M E N T T E A M
“
This year we added significant
depth to our management team.
These senior managers offer the
expertise to take our financial
controls, planning, marketing and
operations to the next level of
sophistication.”
Helen Johnson-Leipold
4
Helen P. Johnson-Leipold
Chairman and Chief Executive Officer
Helen joined Johnson Outdoors in 1999 from S.C. Johnson, where
she held a number of management positions over a 14-year span, most
recently serving as vice president for Personal & Home Care Products.
Prior to S.C. Johnson, Helen was with Foote, Cone and Belding
Advertising for eight years.
Patrick O’Brien
President and Chief Operating Officer
Patrick came to us in 1999 from SC Johnson, where he had served as vice
president and general manager for the Home Storage division; vice president
of strategic business; and vice president of North American Sales.
Paul Lehmann
Vice President and Chief Financial Officer
Paul joined our team in May 2001. He arrived from Steelcase Inc., where
his last position was vice president of finance and strategic planning for
North America. His prior experience includes several executive-level
positions in finance, operations and marketing with Steelcase, Alloyd
Company, Newell (Rubbermaid) and Mark Controls Corporation.
Kevin Mooney
Vice President, Human Resources
Kevin came to us in 2000 from SC Johnson, where he was director of
human resources for NACP Manufacturing and, before that, director
of compensation for North America of SCJ.
Alisa Swire
Vice President, Business Development
Alisa joined us in February 2001. She served two years as director of
mergers and acquisitions at Wal-Mart International, and before that was
director of corporate development at Case Corporation.
Susan Love
Vice President and Chief Information Officer
Susan joined us in January 2001 after 14 years with the Kellogg
Company, most recently as senior director, North America IT Customer
Account Service. She was also director of worldwide technology archi-
tecture and of business information development for Kellogg.
Every facet of our business strategy points toward one ultimate goal: positioning Johnson Outdoors
for sustainable growth that outpaces the industry. Here’s what our senior management team has to say
about the steps we’re taking in 2002 to achieve that goal.
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
Patrick O’Brien
Paul Lehmann
Kevin Mooney
Alisa Swire
Susan Love
We’re streamlining and
Implementing the Network
We’ve made great strides this
We’re working hard to
This year, “Project Network”
creating efficiencies across
operating model has already
past year in building depth
balance internal growth
will look at implementing
the board. In anticipation
produced positive results.
of talent. Many employees
with growth through acqui-
compatible systems to share
of an uncertain market,
We will accelerate our
took on new and challeng-
sition. Strong base business
data and sharpen our com-
we’ve pushed cost disci-
efforts in 2002 to leverage
ing assignments, greatly
growth will help us leverage
petitive edge. It’s the logical
pline, already identifying
the collective strength of the
enhancing their skill sets.
our core capabilities and
next step as we standardize
millions of dollars in
Johnson Outdoors brands
We also brought many new
brand equities. As for
business processes. We’re
savings—but we’re also
even further. Continued
employees into the organiza-
acquisitions, we’re always
continuing to roll out
keeping the pressure on
focus on inter-company
tion. I’m excited about the
evaluating opportunities
JDE, an enterprise-wide
new product development.
coordination and coopera-
fact that we’re building a
against our strategic criteria.
information system that will
We’re developing a procure-
tion will help us spread best
very talented workforce.
We want to be in the #1
make it easier to analyze
“
ment team to realize the
practices, improve financial
potential of our buying
and operating discipline,
power. And we’re creating
and drive great efficiencies
synergy with our new
in our relationships with
National Accounts Team,
major suppliers and cus-
offering national, growing
tomers. The benefits of such
customers our full range
sharing to our policies,
of products from a single
reporting and supply chain
point of sale. As Helen
processes will translate into
pointed out, innovative
products give us a leg up
reduced operating complex-
ity and improved bottom
on the competition, and
line performance.
leading-edge marketing will
help us make the most of
that advantage.
or #2 position in each
information and manage
category where we compete.
customer relationships
We’ve generally achieved
across all our businesses.
that with our current
brands and require the
same potential for any
acquisition we consider.
”
5
W A
T
E
R
C
R
A
F
T
We accelerated the pace of improvement in
Watercraft, but we couldn’t overcome 2001’s
industry-wide sales drop. In 2002, we’ll
heighten our focus on inventory management
and continue to improve return on assets.
Exciting entries like the Venus, a lightweight
women’s kayak, and a line of resort products
will tap the category’s huge potential. And
expansion into Europe and Asia Pacific will
strengthen our position as a market leader.
6
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
B R A N D S
O L D T O W N H E R I TA G E C A N O E
C L A S S I C I N N O V AT I O N Our
Watercraft heritage starts with quality,
as in the handcrafted Old Town Canoe
model A, whose design dates to the
early 1900s. We add innovation, as
in the Extrasport RetroGlide Butterfly
lifejackets, whose size adjustment is on
the back to eliminate uncomfortable
hardware. And our kayaks feature both
classic design and innovation—offering
entry-level handling with the aesthetics
of fiberglass in the Nantucket Elite,
and sit-inside stability plus high-end
sea kayak features in the Pro SI 149.
EXTRASPORT RETROGLIDE BUTTERFLY
OLD TOWN NANTUCKET ELITE
OCEAN KAYAK PRO SI 149
M O
T
O
R
S
As fishing enthusiasts know, persistence pays
off. Our continued emphasis on marketing,
innovation and quality has kept Motors at the
top of the market. This year we have continued
to increase market share despite weak
sales. We’re looking to grow with our OEM
partners and introduce promising products
like the Universal Sonar and Riptide saltwater
motors—the first in the industry to offer
a three-year warranty.
8
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
B R A N D S
U N I V E R S A L S O N A R
M O T O R S is expanding markets
with innovative products like the
Universal Sonar, the first trolling
motor to feature a fully integrated
transducer that is compatible with
most fishfinders on the market.
We’re exceeding consumers’ demands
for quality and performance with
corrosion-resistant features on our
new Riptide saltwater motors, which
come with an exclusive three-year
warranty. And with the MK 106,
our first entry-level onboard battery
charger, we’re increasing our presence
in a growing category.
MINN KOTA RIPTIDE MOTOR
MINN KOTA ALL-TERRAIN MOTOR MK 106 ONBOARD BATTERY CHARGER
9
D
I
V
I
N
G
TWIN SPEED FIN
The excitement continues for Diving
with worldwide market share gains. New
innovative products for the 2002 season
include a new lineup of Smart computers
offering the first wireless infrared connection
for easy downloading of diving profile.
We’re also working with certification
agencies in order to reach out to new divers.
10
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
B R A N D S
SCUBAPRO MK25T/S600T REGULATOR SCUBAPRO LADYHAWK BC
U W AT E C S M A R T C O M
T E C H N I C A L T R I U M P H S
New research led to our Smart COM
dive computer’s advanced micro-
bubble suppression technology,
promoting safer diving. Our Twin
Jet is the first full-foot fin endorsed
by professionals for both diving and
snorkeling, while the lightweight
MK25T/S600T titanium regulator
registered the industry’s top breathing
machine scores. And the Ladyhawk
buoyancy compensator, developed
with the Women’s Scuba Diving
Association, offers female divers
new comfort with a backpack-style
harness system.
11
O U T D O O R E Q U I P M E N T
SILVA ERGO-GRIP EXPLORER
This year, the Outdoor Equipment Group stood
on familiar terrain: increasing sales, especially
in military tents, and improving operating profit,
driven by Silva field compasses. Eureka! is the only
company supplying both large, heavy-duty tents
and lightweight backpacking tents to the military.
The Eureka! 5th Season EXO tent was also chosen
for a well-publicized expedition to Mount Everest—
a great lead-in for our consumer version this year.
12
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
B R A N D S
EUREKA! VISTA
CAMP TRAILS SEQUOIA BACKPACK
E U R E K A ! 5 T H S E A S O N E X O
D E S I G N W I T H A P P E A L
World-famous climbers helped us
design the Eureka! 5th Season EXO
tent for their most recent Mount
Everest expedition, paving the way
for this year’s consumer version.
Our new Silva Ergo-Grip™ Explorer,
a bright-colored, soft-touch sleeve,
protects the compass and makes it
easy to spot if dropped. The Eureka!
Vista is an affordable peak-top tent
that simplifies setup with a patent-
pending swivel bracket. And the
Sequoia backpack’s friendly design
reaches out to the growing number
of weekend hikers.
13
O U T D O O R E Q U I P M E N T
E U R O P E
JACK WOLFSKIN MOVE PANT MEN
Jack Wolfskin is continuing positive momentum
from its base in Germany and rolling out to
Northern Europe. This year, we opened eleven
more stores, including one in Denmark and
two in Switzerland. The resulting rise in non-
German sales fueled profitability improvements.
Wolfskin uses unique materials and technical
expertise to create exciting products like the
Mountain Adventure footwear line—making
our gear among the most popular in Europe.
Photo: HEF003178 Frank Heuer
14
J o h n s o n O u t d o o r s I n c . 2 0 0 1 A n n u a l R e p o r t
B R A N D S
JACK WOLFSKIN MOUNTAIN REBEL SHOE JACK WOLFSKIN ARCHES III REAL TUNNEL® TENT
S TA I N L E S S R O C K J A C K E T
M AT E R I A L A D V A N C E S
Only the lightest, most technically advanced,
toughest GORE-TEX® fabrics go into our
streamlined STAINLESS ROCK touring
and trekking jacket. Like the MOVE
PANT MEN, it’s specially tailored for ease
of motion and freedom of movement. The
MOUNTAIN REBEL all-around hiking
boot delivers excellent traction on demanding
trails and uses toughskin reinforcements in
the high-abrasion zones for added durability.
And our REAL TUNNEL system’s aerody-
namic design, based on Porsche wind tunnel
tests, works with a specialized tent pole
system to provide incredible stability
in sidewinds, as well as comfort.
15
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Necky Elaho Kayak
Leisure Life Waterquest Camo
Carlisle Magic Red Long
Ocean Kayak Agean Mist Kayak
Old Town Sebago Kayak
Old Town Wood Classic Canoe
Minn Kota Genesis Trolling Motor
Minn Kota Weedless Wedge
Minn Kota Vantage Trolling Motor
Minn Kota Maxxum Trolling Motor
MK220 Onboard Charger
Minn Kota AutoPilot Trolling Motor
Uwatec Smart COM Dive Computer
Scubapro Titanium Regulator
Scubapro Twin Jet Fin
Scubapro Glide BC
Scubapro Clear VU2
Scubapro Shorty
Eureka! 5th Season EXO Tent
Eureka! Military Tent
Eureka! Mountain Pass EXO Tent
Eureka! Vista Tent
Eureka! Zeus EXO Tent
Eureka! Twin Tube Tent
SQUAW VALLEY JACKET
MOUNTAIN REBEL SHOE
WOLFPACK FLEECE JACKET
ARCHES III REAL TUNNEL TENT
TRAILHEAD BACKPACK
MR. BIKE PACK
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 10 - K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 28, 2001
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 0-16255
JOHNSON OUTDOORS INC.
(Exact name of Registrant as specified in its charter)
Wisconsin
(State or other jurisdiction of
incorporation or organization)
39-1536083
(I.R.S. Employer Identification No.)
1326 Willow Road, Sturtevant, Wisconsin 53177
(Address of principal executive offices)
(262) 884-1500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to section 12(g) of the Act:
Class A common stock, $.05 par value
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 if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not
contained herein, and will not be contained, to the best of Registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K, or any amendment to this
Form 10-K. [ ]
As of November 1, 2001, 6,946,012 shares of Class A and 1,222,729 shares of Class B common stock
of the Registrant were outstanding. The aggregate market value of voting stock of the Registrant held by
nonaffiliates of the Registrant was approximately $25,182,136 on November 1, 2001.
D O C U M E N T S I N C O R P O R AT E D B Y R E F E R E N C E
TA B L E O F C O N T E N T S
Page
Part and Item Number of Form 10-K
into which Incorporated
Part III, Items 10, 11, 12 and 13
Document
Johnson Outdoors Inc. Notice of
Annual Meeting of Shareholders
and Proxy Statement for the
Annual Meeting of Shareholders
to be held February 19, 2002.
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
Submission of Matters to a Vote of Security Holders . . . . . . . . . . . . . . . . . . . . .5
Market for Registrant’s Common Equity and Related Stockholder Matters . . . . .5
Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
Management’s Discussion and Analysis of
Financial Condition and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . .7
Quantitative and Qualitative Disclosures about Market Risk . . . . . . . . . . . . . .11
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . .11
Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
Directors and Executive Officers of the Registrant . . . . . . . . . . . . . . . . . . . . . .12
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
Security Ownership of Certain Beneficial Owners and Management . . . . . . . . .12
Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . .12
Exhibits, Financial Statement Schedules and Reports on Form 8-K . . . . . . . . . .12
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13
Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-1
FORWARD LOOKING STATEMENTS
Certain matters discussed in this 2001 Form 10-K and in the accompanying 2001
Annual Report are “forward-looking statements,” intended to qualify for the safe
harbors from liability established by the Private Securities Litigation Reform Act of
1995. These forward-looking statements can generally be identified as such because
the context of the statement includes phrases such as the Company “expects,”
“believes” or other words of similar meaning. Similarly, statements that describe the
Company’s future plans, objectives or goals are also forward-looking statements.
Such forward-looking statements are subject to certain risks and uncertainties which
could cause actual results or outcomes to differ materially from those currently
anticipated. Factors that could affect actual results or outcomes include changes in
consumer spending patterns, actions of companies that compete with the Company,
the Company’s success in managing inventory, movements in foreign currencies or
interest rates and adverse weather conditions. Shareholders, potential investors and
other readers are urged to consider these factors in evaluating the forward-looking
statements and are cautioned not to place undue reliance on such forward-looking
statements. The forward-looking statements included herein are only made as of the
date of this 2001 Form 10-K and in the accompanying 2001 Annual Report and the
Company undertakes no obligations to publicly update such forward-looking state-
ments to reflect subsequent events or circumstances.PA R T I
PA R T I
ITEM 1. BUSINESS
Johnson Outdoors Inc. and its subsidiaries (the “Company”) design, manufacture
and market outdoor recreation products in four businesses: Diving, Watercraft,
Outdoor Equipment and Motors. The Company’s primary focus is innovation—
meeting consumer needs with breakthrough products that stand apart from the com-
petition and advance the Company’s strong brand names. Its subsidiaries are
organized in a network that promotes entrepreneurialism and leverages best practices
and synergies, following the strategic vision set by headquarters. The Company is
controlled by Samuel C. Johnson, members of his family and related entities.
The Company was incorporated in Wisconsin in 1987 as successor to various businesses.
Diving
The Company is one of the world’s largest manufacturers and distributors of tech-
nical underwater diving products, which it sells under the Scubapro and SnorkelPro
names. The Company markets a full line of underwater diving and snorkeling equip-
ment, including regulators, stabilizing jackets, tanks, depth gauges, masks, fins,
snorkels, diving electronics and other accessories. The Company is also a leading
manufacturer of dive computers and other electronics sold under the Aladin and
Uwatec brands. Scubapro, Aladin and Uwatec products are marketed to the high
quality, premium priced segment of the market via limited distribution to inde-
pendent specialty diving shops worldwide. These diving shops generally provide a
wide range of services to divers, including instruction and repair service.
The Company focuses on maintaining Scubapro, Aladin and Uwatec as the market
leaders in innovation and new products. The Company maintains research and
development functions both in the United States and Europe and holds several
patents on products and features. Consumer advertising focuses on building the
brand names and the Company’s position as the industry’s high quality and innova-
tion leader. The Company advertises its equipment in diving magazines and through
in-store displays.
The Company also manufactures and markets diving buoyancy compensators pri-
marily for the original equipment market, under the Soniform name.
The Company maintains manufacturing and assembly facilities in Switzerland,
Mexico, Italy and Indonesia and procures a majority of its rubber and plastic prod-
ucts and components from third-party manufacturers.
1
Watercraft
The Company manufactures and markets canoes, kayaks, paddles, oars, recreational
sailboats, personal flotation devices and small thermoformed recreational boats
under the brand names Old Town, Carlisle Paddles, Ocean Kayak, Pacific Kayak,
Canoe Sports, Necky, Escape, Extrasport, Swiftwater, Leisure Life and Dimension.
Outdoor Equipment
The Company’s Outdoor Equipment products include Jack Wolfskin high quality
technical outdoor clothing, innovative footwear, camping tents, backpacks, travel
gear and accessories; Eureka! military, commercial and consumer tents; Camp Trails
backpacks; and Silva field compasses.
The Company’s Old Town Canoe subsidiary produces high quality canoes, kayaks
and accessories for family recreation, touring and tripping. The Company uses a
patented rotational-molding process for manufacturing polyethylene kayaks and
canoes to compete in the high volume, low and mid-priced range of the market.
These kayaks and canoes feature stiffer and more durable hulls than higher priced
boats. The Company also manufactures canoes from fiberglass, Royalex (ABS) and
wood. Carlisle Paddles, a manufacturer of canoe and kayak paddles and rafting oars,
supplies paddles and oars to the Company’s other watercraft businesses and also dis-
tributes directly through the accessories channels mentioned below under the
Carlisle brand.
The Company is a leading manufacturer of sit-on-top kayaks under the Ocean
Kayak and Pacific Kayak brands. In addition, the Company manufactures and mar-
kets high quality Necky sea touring and whitewater kayaks; Escape recreational sail-
boats; Extrasport and Swiftwater personal flotation devices; small thermoformed
recreational boats, including canoes, pedal boats, deck boats and tenders, under the
Leisure Life brand; and the Dimension brand of kayaks.
In April 2001, the Company completed the acquisition of Fibrekraft Manufacturers
Ltd., a manufacturer of paddles and watercraft accessories based in Napier, New Zealand.
The Company’s kayaks, canoes and accessories are sold primarily to specialty stores
and marine dealers, sporting goods stores and catalog and mail order houses such as
L. L. Bean®, in the United States and Europe. Leisure Life products are sold through
marine dealers and large retail chains under several brand identities.
The Company manufactures its Watercraft products in six locations in the United
States, two locations in Canada and in New Zealand. Ocean Kayak products are also
manufactured and sold under license in Europe.
The North American market for kayaks is exhibiting strong growth, while the canoe
market is growing modestly. The Company believes, based on industry and other
data, that it is a leading manufacturer of canoes and kayaks in the United States in
both unit and dollar sales.
2
Jack Wolfskin, based in Germany, distributes its products primarily through special-
ized outdoor stores, selected sporting goods dealers and a number of franchised Jack
Wolfskin stores. Jack Wolfskin has a strong position in Germany with additional dis-
tribution in the key European markets of Great Britain, Benelux, Switzerland and
Austria. The product is also sold in Canada and the United States and, under license,
in Japan. Jack Wolfskin utilizes the latest in fabric technology to produce products
that are both comfortable and protective for outdoor related activities. The products
compete in the premium segments.
Eureka! consumer tents and Camp Trails backpacks compete primarily in the mid-
to high-price range and are sold in the United States and Canada through inde-
pendent sales representatives, primarily to sporting goods stores, catalog and mail
order houses and camping and backpacking specialty stores. Marketing of the
Company’s tents and backpacks is focused on building the Eureka! and Camp Trails
brand names and establishing the Company as a leader in tent design and innova-
tion. The Company’s camping tents and backpacks are produced primarily by third-
party manufacturing sources.
Eureka! camping tents have outside self-supporting aluminum frames, allowing
quicker and easier set-up, a design approach the Company originated. Most Eureka!
tents are made from breathable nylon. Eureka! camping products are sold under
license in Japan and Korea. Eureka! commercial tents include party tents, sold pri-
marily to general rental stores, and other commercial tents sold directly to tent erec-
tors. Commercial tents are manufactured by the Company in the United States.
Eureka! designs and manufactures large, heavy-duty tents and lightweight back-
packing tents for the military. The Company has three contracts for production of
both camping and commercial tents with the U.S. Armed Forces. In 1997, the
Company was awarded contracts to produce a lightweight, two-man combat tent for
the Marine Corps and a modular, general purpose tent for the Army. The Marine
Corps contract was for 60 months and expires in August 2002. The Company has
shipped more than 80% of the contract’s maximum order quantities. The Army con-
tract was for five years (base year and an option for four additional ordering periods).
The first two optional ordering periods were exercised and the Army is currently in
optional ordering period three, which expires in December 2001. The Company
believes the final ordering period will be exercised and would expire in December
2002. All material terms and obligations of these contracts have been and continue
to be satisfied. In September 2001, the Company was awarded a five-year contract
(base year and four optional years) to produce a four-person, extreme cold weather
tent for the Marine Corps. The Company has submitted bids on additional contracts
and expects decisions on contract awards to be made in 2002.
Camp Trails backpacks consist primarily of internal and external frame backpacks for
hiking and mountaineering, but also include soft back bags, day packs and travel packs.
Silva field compasses, which are manufactured by third parties, are marketed exclu-
sively in North America, the area for which the Company owns Silva trademark rights.
Motors
The Company manufactures, under its Minn Kota name, battery powered motors
used on fishing boats and other boats for quiet trolling power or primary propulsion.
The Company’s Minn Kota motors and related accessories are sold in the United
States, Canada, Europe and the Pacific Basin through large retail store chains such as
Wal Mart and K-Mart, catalogs such as Bass Pro Shops and Cabelas, sporting goods
specialty stores, marine dealers, and original equipment manufacturers (OEM)
including Ranger® Boats, Lowe, Stratos/Javilin, Four Winns, Triton Boats, Lund
Boats, Smoker Craft, Alumacraft, Skeeter, Express Boats and Tracker. Consumer
advertising and promotion include advertising on regional television and in outdoor,
general interest and sports magazines. Packaging and point-of-purchase materials are
used to increase consumer appeal and sales.
The Company has the leading market share of the U.S. electric fishing motor mar-
ket. While the overall motors market has been stagnant in recent years, the Company
has been able to gain share by emphasizing marketing, product innovation and orig-
inal equipment manufacturer sales.
The Company’s line of Airguide marine, weather and automotive instruments is distrib-
uted primarily in the United States through large retail store chains and OEMs. Airguide
products are manufactured by the Company or sourced from third-party manufacturers.
In 2001, the Company exited the weather and automotive instrument categories.
Fishing
In March 2000, the Company sold its Fishing business (consisting of the marketing
of rods, reels, lures, spoons and fishing line). As a result, the operations and related
assets and liabilities of the Fishing business have been restated as discontinued for
financial reporting purposes. A significant loss on the sale of the business was recog-
nized, but the tangible net worth of the Company was not adversely impacted. See
Note 4 to the Consolidated Financial Statements for financial information.
Financial Information for Business Segments
See Note 13 to the Consolidated Financial Statements for financial information
comparing each business segment.
International Operations
See Note 13 to the Consolidated Financial Statements for financial information
comparing the Company’s domestic and international operations.
Research and Development
The Company commits significant resources to research and new product develop-
ment. The Company expenses research and development costs as incurred. The
amounts expended by the Company in connection with research and development
activities for each of the last three fiscal years are set forth in the Consolidated
Statements of Operations.
Competition
The Company believes its products compete favorably on the basis of product inno-
vation, product performance and marketing support and, to a lesser extent, price.
Diving: The main competitors in Diving include Oceanic, Aqualung and Suunto, each
of which competes on the basis of product innovation, performance, quality and safety.
Watercraft: The Company primarily competes in the paddle sport segment of
canoes and kayaks. Main competitors are Watermark and Confluence, who also
make a full range of boats. These companies compete on the basis of their design,
performance and quality.
Outdoor Equipment: The Company’s brands and products compete in the specialty
segments of the outdoor equipment market and not in the mass market. Coleman,
Jansport and private label brands have a strong position in tents and packs sold in
mass outlets, and the Company does not intend to compete head on with these man-
ufacturers. The Company intends to compete with the specialty companies such as
North Face and Kelty on the basis of materials and innovative designs for consumers
who want performance products priced at a value.
Motors: The main competitor in electric trolling motors is Motor Guide from
Brunswick, who manufactures and sells a full range of trolling motors and accessories.
Competition in this segment is focused on product benefits and features for fishing.
3
Employees
At September 28, 2001, the Company had approximately 1,400 employees. The
Company considers its employee relations to be excellent. Temporary employees are
utilized to manage peaks in the seasonal manufacturing of products.
Backlog
Unfilled orders for future delivery of products of continuing operations totaled
approximately $51.6 million at September 28, 2001 and $61.0 million at September
29, 2000. The Company’s businesses do not receive significant orders in advance of
expected shipment dates for the majority of their products.
Patents, Trademarks and Proprietary Rights
The Company owns no single patent that is material to its business as a whole.
However, the Company holds several patents, principally for diving products, rota-
tional-molded canoes and electric motors, and regularly files applications for patents.
The Company has numerous trademarks and trade names which it considers impor-
tant to its business, many of which are discussed on the preceding pages. The
Company vigorously defends its intellectual property rights.
Sources and Availability of Materials
The Company’s products use materials that are generally in adequate supply.
Seasonality
The Company’s business is seasonal. The following table shows, for the past three fis-
cal years, total net sales and operating profit or loss related to continuing operations
of the Company for each quarter, as a percentage of the total year. Strategic charges
totaling $1.4 million, $2.4 million and $2.8 million impacted operating results in
2001, 2000 and 1999, respectively.
September 28, 2001
September 29, 2000
1%
Net Operating
Sales
Profit
16%
28
33
23
100%
39
56
4
100%
Quarter Ended
December
March
June
September
Net
Sales
17%
29
33
21
100%
Operating
Profit (Loss)
(23)%
42
83
(2)
100%
4
Year Ended
October 1, 1999
Operating
Profit
(Loss)
(16)%
43
70
3
100% 100%
Net
Sales
16%
28
33
23
Executive Officers
The following list sets forth certain information, as of December 1, 2001, regarding
the executive officers of the Company.
Helen P. Johnson-Leipold, age 44, became Chairman and Chief Executive Officer of
the Company in March 1999. From September 1998 until March 1999, Ms.
Johnson-Leipold was Vice President, Worldwide Consumer Products-Marketing of
S. C. Johnson & Son, Inc. (SCJ). From October 1997 to September 1998, she was
Vice President, Personal and Home Care Products of SCJ. From October 1995 until
July 1997, Ms. Johnson-Leipold was Executive Vice President - North American
Businesses of the Company. From 1992 to September 1995, she was Vice President
- Consumer Marketing Services Worldwide of SCJ.
Patrick J. O’Brien, age 43, became President and Chief Operating Officer of the
Company in April 1999. From October 1997 until March 1999, Mr. O’Brien was
Vice President and General Manager, Home Storage of SCJ. From July 1997 until
October 1997, Mr. O’Brien was Vice President - Strategic Business of SCJ; from
April 1996 until June 1997, he was Vice President - North American Sales of SCJ;
from June 1995 until March 1996, he was Director - North American Sales of SCJ
and from January 1993 until May 1995, he was National Sales Manager of SCJ.
Paul A. Lehmann, age 48, became Vice President and Chief Financial Officer of the
Company in May 2001. From October 1999 to May 2001, Mr. Lehmann was Vice
President, Finance and Strategic Planning of Steelcase North America (SCNA).
From June 1997 to October 1999, Mr. Lehmann was Vice President, Operations
Finance of SCNA. From November 1995 to June 1997, he was Director of
Customer Pricing and Contracts for SCNA.
Mamdouh Ashour, age 63, has been a Group Vice President of the Company since
October 1997 and President - Worldwide Diving since August 1996. From 1994 to
August 1996, he served as President of Scubapro Europe. He has been employed by
the Company since 1973.
There are no family relationships between the above executive officers.
ITEM 2. PROPERTIES
The Company maintains both leased and owned manufacturing, warehousing, dis-
tribution and office facilities throughout the world. The Company believes that its
facilities are well maintained and have capacity adequate to meet its current needs.
See Note 6 to the Consolidated Financial Statements for a discussion of lease obligations.
ITEM 3. LEGAL PROCEEDINGS
See Note 16 to the Consolidated Financial Statements for a discussion of legal proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders during the last quar-
ter of the year ended September 28, 2001.
The Company’s principal manufacturing (identified with an asterisk) and other locations are:
PA R T I I
Albany, New Zealand (Watercraft)
Antibes, France (Diving)
Bad Säkingen, Germany (Diving)
Barcelona, Spain (Diving)
Basingstoke, Hampshire, England (Diving)
Batam, Indonesia* (Diving)
Binghamton, New York* (Outdoor Equipment)
Burlington, Ontario, Canada (Motors, Outdoor Equipment)
Chatswood, Australia (Diving)
Chi Wan, Hong Kong (Diving)
El Cajon, California (Diving)
Ferndale, Washington* (Watercraft)
Genoa, Italy* (Diving)
Grand Rapids, Michigan* (Watercraft)
Grayling, Michigan* (Watercraft)
Hallwil, Switzerland* (Diving)
Hamburg, Germany (Diving)
Henggart, Switzerland (Diving)
Idstein, Germany (Outdoor Equipment)
Mankato, Minnesota* (Motors)
Mansonville, Quebec, Canada* (Watercraft)
Miami, Florida* (Watercraft)
Napier, New Zealand (Watercraft)
Nyköping, Sweden (Diving)
Old Town, Maine* (Watercraft)
Tijuana, Mexico* (Motors, Diving)
Tokyo (Kawasaki), Japan (Diving)
The Company’s corporate headquarters is located in Mount Pleasant, Wisconsin.
The Company’s mailing address is Sturtevant, Wisconsin.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY AND
RELATED STOCKHOLDER MATTERS
Certain information with respect to this item is included in Notes 5, 9, 10 and 11
to the Consolidated Financial Statements. The Company’s Class A common stock is
traded on The Nasdaq Stock Market® under the symbol: JOUT. There is no public
market for the Company’s Class B common stock. However, the Class B common
stock is convertible at all times at the option of the holder into shares of Class A com-
mon stock on a share for share basis. As of November 1, 2001, the Company had
755 holders of record of its Class A common stock and 58 holders of record of its
Class B common stock. The Company has never paid, and has no current intention
to pay, a dividend on its common stock.
A summary of the high and low prices for the Company’s Class A common stock
during each quarter of the years ended September 28, 2001 and September 29, 2000
is as follows:
First Quarter
Second Quarter
Third Quarter
Fourth Quarter
2001
2000
2001
2000
2001
2000
2001
2000
Stock prices:
High
Low
Last
$7.00
4.75
5.88
$9.19
6.13
7.10
$7.56 $8.50
6.13
6.19
5.50
6.13
$8.49 $9.69
6.13
7.06
5.90
6.74
$7.39 $7.94
5.75
6.94
5.98
6.47
5
ITEM 6. SELECTED FINANCIAL DATA
A summary of the Company’s operating results and key balance sheet data for each of the years in the five-year period ended September 28, 2001 is presented below. All periods
have been restated to reflect the discontinuation of the Company’s Fishing business.
September 28
2001
September 29
2000
(thousands, except per share data)
Operating Results(1)
Net sales
Gross profit
Operating expenses(2)
Operating profit
Interest expense
Other expense (income), net
Income from continuing operations before income taxes
Income tax expense
Income from continuing operations before cumulative
effect of change in accounting principle
Income (loss) from discontinued operations
Income (loss) on disposal of discontinued operations
Effect of change in accounting principle
Net income (loss)
Basic earnings (loss) per common share:
Continuing operations
Discontinued operations
Effect of change in accounting principle
Net income (loss)
Diluted earnings (loss) per common share:
Continuing operations
Discontinued operations
Effect of change in accounting principle
$345,637
136,703
120,985
15,718
9,085
543
6,090
2,480
$
$
$
$
3,610
—
—
1,755
5,365
0.44
—
0.22
0.66
0.44
—
0.22
0.66
8,170
$354,889
142,813
118,094
24,719
9,799
(160)
15,080
6,705
8,375
(940)
(24,418)
—
$ (16,983)
$
$
$
1.03
(3.12)
—
(2.09)
1.03
(3.12)
—
(2.09)
8,130
$
$
Net income (loss)
Diluted average common shares outstanding
Balance Sheet Data
Current assets(3)
Total assets
Current liabilities(4)
Long-term debt, less current maturities
Total debt
Shareholders’ equity
(1) The year ended October 3, 1997 includes 53 weeks. All other years include 52 weeks.
(2) Includes strategic charges of $1,448, $2,369, $2,773, $1,388 and $335 in 2001, 2000, 1999, 1998 and 1997, respectively.
(3) Includes net assets of discontinued operations of $56,114, $58,462 and $66,507 in 1999, 1998 and 1997, respectively.
(4) Excluding short-term debt and current maturities of long-term debt.
$144,194
257,971
46,941
45,857
105,319
100,832
$133,180
244,913
36,568
84,550
97,535
105,779
6
October 1
1999
$310,198
125,774
106,261
19,513
9,565
(71)
10,019
4,158
5,861
1,161
—
—
7,022
0.72
0.15
—
0.87
0.72
0.15
—
0.87
8,108
$
$
$
$
$
$185,733
299,025
45,072
72,744
122,071
127,178
October 2
1998
$274,005
110,789
92,433
18,356
9,631
(539)
9,264
3,885
5,379
(167)
—
—
5,212
0.66
(0.02)
—
0.64
0.66
(0.02)
—
0.64
8,114
$
$
$
$
$
$188,224
292,380
39,448
81,508
124,001
124,386
Year Ended
October 3
1997
$242,351
94,147
80,266
13,881
8,413
(624)
6,092
2,721
3,371
(1,315)
—
—
2,056
0.42
(0.17)
—
0.25
0.42
( 0.17)
—
0.25
8,115
$
$
$
$
$
$184,555
272,605
36,772
87,926
113,676
117,731
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The following discussion includes comments and analysis relating to the Company’s
results of operations and financial condition for the three years ended September 28,
2001. Unless otherwise noted, the discussion refers to continuing operations. This
discussion should be read in conjunction with the Consolidated Financial
Statements and related notes thereto.
Results of Operations
Summary consolidated financial results from continuing operations are as follows:
(millions, except per share data)
Net sales
Gross profit
Operating expenses(1)
Operating profit
Interest expense
Income from continuing operations
Diluted earnings per common share
2001
$345.6
136.7
121.0
15.7
9.1
3.6
from continuing operations before
change in accounting principle
0.44
2000
$354.9
142.8
118.1
24.7
9.8
8.4
1999
$310.2
125.8
106.3
19.5
9.6
5.9
1.03
0.72
(1)Includes strategic charges of $1.4 million, $2.4 million and $2.8 million in 2001, 2000 and 1999,
respectively.
2001 vs 2000
Net Sales
Net sales totaled $345.6 million in 2001 compared to $354.9 million in 2000, a
decrease of 3%. Sales as measured in U.S. dollars were impacted by the effects of for-
eign currencies relative to the U.S. dollar in comparison to 2000. Excluding the
effects of foreign currency movements, sales were nearly flat when compared with
2000. The flat trend in sales was a result of a soft economy both in the United States
(U.S.) and abroad. Sales were impacted by customer bankruptcies in both the Motors
and Diving businesses. The Company believes these bankruptcies impacted sales in
2001 by approximately $4.8 million. As a result of the soft economy, we saw marginal
growth or even contraction in the markets of our businesses. However, market data
indicated that the Company gained market share in nearly all of our businesses.
The Outdoor Equipment business was strong, increasing sales 10% over 2000, pri-
marily related to strong performances by Jack Wolfskin and military tents. Diving
sales were down 3% from 2000, primarily related to the negative impact of foreign
currency movements from 2000. Excluding the effects of foreign currency move-
ments, Diving sales increased 3% from 2000. The Watercraft and Motors businesses
were impacted the most by the soft economy, with sales declines of 5% and 16%,
respectively. The Motors business gained market share in a contracting market and
lost approximately $4.0 million in sales related to the bankruptcy of a large OEM
customer. However, the Company feels a majority of these sales will return in 2002,
as the OEM customer was sold out of bankruptcy and has begun placing orders. The
Watercraft business saw a significant decline in market growth after three plus years
of double digit growth in that category.
Operating Results
The Company recognized an operating profit of $15.7 million in 2001 compared to
an operating profit of $24.7 million in 2000. Gross profit margins decreased from
40.2% in 2000 to 39.6% in 2001, as improvements in the Diving and Outdoor
Equipment businesses were more than offset by declines in the Watercraft and Motors
businesses. Shortfalls in sales volume for 2001 negatively impacted gross profits by
$3.4 million due to unfavorable manufacturing labor and overhead variances, prima-
rily in the Watercraft business, and to a lesser extent, the Motors business.
Operating expenses, excluding strategic charges, totaled $119.5 million, or 34.6%
of sales, in 2001 compared to $115.7, or 32.6% of sales in 2000. Amortization of
acquisition costs were $5.3 million in 2001, which included a $2.5 million write-
down for impaired goodwill related to the Airguide brand in the Motors business,
compared to $3.0 million in 2000. Bad debt expense related to the previously men-
tioned customer bankruptcies added approximately $0.9 million to operating
expenses in 2001.
The Outdoor Equipment business increased operating profit by $3.8 million, or
47%, to $12.0 million in 2001 compared to $8.2 million in 2000. Strong results by
Jack Wolfskin and military tents more than offset softness in the consumer and com-
mercial tent businesses. The Diving business was also strong, increasing operating
profits by 7% to $11.6 million in 2001, despite a sales decline, by improving prod-
uct mix towards higher margin products along with a decline in operating expenses.
Excluding the $2.5 million write-down for impaired goodwill, the Motors business
had operating profits of $2.8 million in 2001 compared to $3.9 million in 2000. A
decline in operating expense, excluding strategic charges, of $1.0 million versus the
prior year, helped mitigate the decline in operating profit.
7
The Watercraft business was impacted by several issues, resulting in a decline in oper-
ating profits in 2001 to $1.3 million from operating profits of $10.3 million in
2000. The business experienced the trailing affects of significant growth, over-capac-
ity and the impacts of too much complexity in this segment of our business. In addi-
tion to the gross profit issues described above, operating expenses grew by $3.1
million, or 11% from 2000 levels due to investment in infrastructure to support the
previous significant growth of the business and additional costs supporting the com-
plex structure of the business. The Company believes the issues related to Watercraft
can and are being fixed, as evidenced by the closure and relocation of two manufac-
turing facilities in 2001. The Company is in the process of streamlining U.S. East
coast distribution from five warehouses down to one and has hired both a new gen-
eral manager and operations manager at our Old Town Canoe business, to drive
improved results from this important operation in the Watercraft business. The
Company will continue to investigate synergistic opportunities in this business over
the next year.
The Company recognized strategic charges totaling $1.4 million in 2001 for sever-
ance, moving and other costs related to the closure and relocation of two manufac-
turing facilities in the Watercraft business. The Company believes that these actions
will save approximately $1.5 million in operating expenses on an annual basis after
completion. The Company anticipates incurring additional strategic charges related
to these actions of approximately $0.7 million in 2002. In 2000, the Company
incurred strategic charges of $2.4 million from severance, moving and other costs
related to the closure and relocation of a manufacturing facility in the Motors busi-
ness and for severance, relocation and recruitment costs in the North American
Outdoor Equipment business.
Other Income and Expenses
Interest expense decreased $0.7 million in 2001, reflecting a decline in interest rates
from prior year levels and a reduction in working capital needs versus 2000 levels.
Foreign currency translation losses related to the mark to market of foreign currency
denominated debt and foreign currency forward contracts resulted in an increase of
$0.7 million in translation losses over the prior year levels.
Results From Continuing Operations
The Company recognized income from continuing operations before cumulative
effect of change in accounting principle of $3.6 million in 2001 or $0.44 per diluted
share, compared to $8.4 million in 2000 or $1.03 per diluted share. The Company
recorded income tax expense of $2.5 million in 2001, an effective tax rate of 40.7%.
This decreased rate (from 44.5% in 2000) is mainly the result of changes in mix of
earnings from jurisdictions with higher tax rates to those with lower tax rates.
Discontinued Operations
In March 2000, the Company sold its Fishing business. The Company recorded a
loss on disposal of a discontinued business, net of tax, of $24.4 million in 2000, tak-
ing into account operating results of the business from the measurement date to the
date of disposal. In addition, the Company recorded an after tax loss from operations
up to the measurement date of $0.9 million in 2000.
Change in Accounting Principle
Effective September 30, 2000, the Company adopted SFAS 133, which establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts and for hedging activities. All
derivatives, whether designated in hedging relationships or not, are required to be
recorded on the balance sheet at fair value. If the derivative is designated as a fair
value hedge, the changes in fair value of the derivative and the hedged item are rec-
ognized in earnings. If the derivative is designated as a cash flow hedge, changes in
the fair value of the derivative are recorded in other comprehensive income and are
recognized in earnings when the hedged item affects earnings.
The adoption of SFAS 133 resulted in an effect of change in accounting principle
after tax gain of $1.8 million in 2001.
Net Income (Loss)
The Company recognized net income of $5.4 million in 2001, or $0.66 per diluted
share, compared to a net loss of $17.0 million in 2000, or $2.09 per diluted share.
2000 vs 1999
Net Sales
Net sales totaled $354.9 million in 2000 compared to $310.2 million in 1999, an
increase of 14%. Sales as measured in U.S. dollars were impacted by the effect of for-
eign currencies relative to the U.S. dollar in comparison to 1999. Excluding the
effects of foreign currency movements, sales increased 17% from 1999. The increase
was partially driven by the introduction of innovative new products in the Watercraft
and Motors businesses, as well as growth in sales of existing products in Watercraft,
Motors and Outdoor Equipment.
8
Operating Results
The Company recognized an operating profit of $24.7 million in 2000 compared to
an operating profit of $19.5 million in 1999. Gross profit margins decreased from
40.5% in 1999 to 40.2% in 2000, as significant improvements in the Diving and
Outdoor Equipment businesses, as well as improvement in the Motors business (due
to emphasis on higher margin products, increases in volume and improved produc-
tion efficiencies) were offset by a decline in Watercraft (due to production issues
related to a 26.4% growth in Watercraft revenues).
Operating expenses, excluding strategic charges, totaled $115.7 million, or 32.6% of
sales, in 2000 compared to $103.5 million, or 33.3% of sales, in 1999. The 12%
growth in operating expenses in 2000 was less than the growth rate of sales, which
contributed to the improved operating results. Nearly all items in operating expenses
declined as a percentage of sales from 1999.
measurement date to the date of disposal. In addition, the Company recorded an
after tax loss from operations up to the measurement date of $0.9 million in 2000
and an after tax gain of $1.2 million in 1999.
Net Income
The Company recognized a net loss of $17.0 million, or $2.09 per diluted share in
2000, compared to net income of $7.0 million, or $0.87 per diluted share in 1999.
Financial Condition
The following discusses changes in the Company’s liquidity and capital resources.
Operations
The following table sets forth the Company’s working capital position related to con-
tinuing operations at the end of each of the past three years:
The Company recognized strategic charges totaling $2.4 million in 2000 and $2.8
million in 1999. These charges resulted from severance, moving and other costs
related primarily to the closure and relocation of a manufacturing facility in the
Motors business and for severance, relocation and recruitment costs in the North
American Outdoor Equipment business.
(millions)
Current assets(1)
Current liabilities(2)
Working capital
Current ratio
2001
$133.2
36.6
$ 96.6
3.6:1
2000
$144.2
46.9
$ 97.3
3.1:1
1999
$129.6
45.1
$ 84.5
2.9:1
Other Income and Expenses
Interest expense increased $0.2 million in 2000, reflecting higher working capital lev-
els primarily from accounts receivable and inventory, as well as higher interest rates.
Results from Continuing Operations
The Company recognized income from continuing operations of $8.4 million in
2000, or $1.03 per diluted share, compared to $5.9 million, or $0.72 per diluted share,
in 1999. The Company recorded income tax expense of $6.7 million in 2000, an effec-
tive rate of 44.5%. The increased rate from 41.5% in 1999 is due to an increase in state
income tax and change in expected recoverability of state net operating losses.
Discontinued Operations
In March 2000, the Company sold its Fishing business. As a result, operations and
related assets and liabilities of the Fishing group have been classified as discontinued
for all periods presented herein. The sale price totaled $47.3 million, including $14.1
million of accounts receivable retained by the Company and $2.4 million of debt
assumed by the buyer. The Company recorded a loss of $24.4 million, net of tax,
related to the sale of the business, taking into account operating results from the
(1)Excludes net assets of discontinued operations.
(2)Excludes short-term debt and current maturities of long-term debt.
Cash flows provided by operations totaled $15.5 million in 2001, $9.8 million in
2000 and $24.8 million in 1999. The Company’s profitability and decreases in
accounts receivable of $6.8 million, contributed to the positive cash flows in 2001.
Decreases in accounts payable and other accrued liabilities of $11.4 million reduced
the overall positive cash flows provided by operations in 2001. Profitability and
increases in accounts payable and other accrued liabilities of $3.9 million, con-
tributed to the positive cash flows in 2000 and 1999. Growth in accounts receivable
and inventories of $10.7 million and $8.4 million, respectively, reduced the overall
positive cash flows provided by operations in 2000. Accounts receivable growth of
$3.5 million reduced the overall positive cash flows provided by operations in 1999.
Depreciation and amortization charges were $13.5 million in 2001, $12.5 million in
2000 and $12.6 million in 1999. Amortization of intangible assets from the
Company’s acquisitions and increased depreciation from capital spending accounted
for the increase from 2000 to 2001. The Company recorded a charge for impairment
of goodwill of $2.5 million in 2001.
9
Investing Activities
Cash flows provided by (used for) investing activities were ($9.6) million, $20.0 mil-
lion and ($26.1) million in 2001, 2000 and 1999, respectively. Expenditures for prop-
erty, plant and equipment were ($9.8) million in 2001, ($14.1) million in 2000 and
($13.0) million in 1999. The Company’s recurring investments are primarily related
to tooling for new products, facilities and information systems improvements. In
2002, capital expenditures are anticipated not to exceed 2001 levels. These expendi-
tures are expected to be funded by working capital or existing credit facilities.
The Company received $33.1 million in proceeds from the sale of their Fishing busi-
ness in 2000, which contributed to the cash flows provided by investing activities for
that year. These proceeds were used to reduce both short-term and long-term debt.
The Company paid, net of cash acquired, $0.6 million for two small businesses
acquired in 2001, $0.9 million for one business acquired in 2000 and $13.6 million
for three businesses acquired in 1999. In November 2001, subsequent to the end of
the 2001 fiscal year, the Company completed the sale and leaseback of their head-
quarters facility in Sturtevant, Wisconsin. Approximately $5.0 million of additional
cash flow was provided by this transaction.
Financing Activities
The following table sets forth the Company’s debt and capital structure at the end of
the past three years:
(millions)
Current debt
Short-term debt to be refinanced
Long-term debt
Total debt
Shareholders’ equity
Total capitalization
Total debt to total capitalization
2001
$ 13.0
50.0
34.5
97.5
105.8
$203.3
2000
$ 59.5
—
45.8
105.3
100.8
$206.1
1999
$ 49.4
—
72.7
122.1
127.2
$249.3
48.0%
51.1%
49.0%
Cash flows used for financing activities totaled $7.9 million in 2001, $12.5 million in
2000 and $0.8 million in 1999. Payments on long-term debt were $6.8 million, $22.0
million and $7.7 million, in 2001, 2000 and 1999, respectively. Included in 2000 was
$15.1 million in payments from the proceeds of the sales of the Fishing business.
In December 2001, subsequent to the end of the 2001 fiscal year, the Company con-
summated a private placement of long-term debt totaling $50.0 million. As a result of
this financing, short-term debt to be repaid totaling $50.0 million at September 28,
2001 was classified as long-term. At September 28, 2001, the Company had available
unused credit facilities in excess of $33.8 million, which is believed to be adequate for
its needs.
Market Risk Management
The Company is exposed to market risk stemming from changes in foreign exchange
rates, interest rates and, to a lesser extent, commodity prices. Changes in these fac-
tors could cause fluctuations in earnings and cash flows. In the normal course of
business, exposure to certain of these market risks is managed by entering into hedg-
ing transactions authorized under Company policies that place controls on these
activities. Hedging transactions involve the use of a variety of derivative financial
instruments. Derivatives are used only where there is an underlying exposure: not for
trading or speculative purposes.
Foreign Operations
The Company has significant foreign operations, for which the functional currencies
are denominated primarily in Swiss and French francs, German marks, Italian lire,
Japanese yen and Canadian dollars. As the values of the currencies of the foreign
countries in which the Company has operations increase or decrease relative to the
U.S. dollar, the sales, expenses, profits, assets and liabilities of the Company’s foreign
operations, as reported in the Company’s Consolidated Financial Statements,
increase or decrease, accordingly. The Company mitigates a portion of the fluctua-
tions in certain foreign currencies through the purchase of foreign currency swaps,
forward contracts and options to hedge known commitments, primarily for pur-
chases of inventory and other assets denominated in foreign currencies.
Interest Rates
The Company’s debt structure and interest rate risk are managed through the use of
fixed and floating rate debt. The Company’s primary exposure is to United States
interest rates. The Company also periodically enters into interest rate swaps, caps or
collars to hedge its exposure and lower financing costs.
10
Commodities
Certain components used in the Company’s products are exposed to commodity
price changes. The Company manages this risk through instruments such as pur-
chase orders and non-cancelable supply contracts. Primary commodity price expo-
sures are metals and packaging materials.
Sensitivity to Changes in Value
The estimates that follow are intended to measure the maximum potential fair value
or earnings the Company could lose in one year from adverse changes in foreign
exchange rates or market interest rates under normal market conditions. The calcu-
lations are not intended to represent actual losses in fair value or earnings that the
Company expects to incur. The estimates do not consider favorable changes in mar-
ket rates. Further, since the hedging instrument (the derivative) inversely correlates
with the underlying exposure, any loss or gain in the fair value of derivatives would
be generally offset by an increase or decrease in the fair value of the underlying expo-
sures. The positions included in the calculations are foreign exchange forwards, cur-
rency swaps and fixed rate debt. Certain instruments are included in both categories
of risk exposure calculated below. The calculations do not include the underlying for-
eign exchange positions that are hedged by these market risk sensitive instruments.
The table below presents the estimated maximum potential one year loss in fair value
and earnings before income taxes from a 10% movement in foreign currencies and a
100 basis point movement in interest rate market risk sensitive instruments out-
standing at September 28, 2001:
(millions)
Foreign exchange rate instruments
Interest rate instruments
Estimated Impact on
Earnings Before
Income Taxes
$0.7
0.3
Fair Value
$0.7
1.1
Other Factors
The Company has not been significantly impacted by inflationary pressures over the
last several years. The Company anticipates that changing costs of basic raw materi-
als may impact future operating costs and, accordingly, the prices of its products. The
Company is involved in continuing programs to mitigate the impact of cost increases
through changes in product design and identification of sourcing and manufactur-
ing efficiencies. Price increases and, in certain situations, price decreases are imple-
mented for individual products, when appropriate.
Pending Accounting Changes
In June 2001, the FASB issued SFAS No. 142 Goodwill and Other Intangibles (SFAS
142). SFAS 142 addresses financial accounting and reporting for goodwill and other
intangible assets subsequent to their acquisition. Upon adoption of SFAS 142, good-
will will no longer be subject to amortization over its estimated useful life. Rather,
goodwill will be subject to at least an annual assessment for impairment by applying
a fair-value-based test. Other intangible assets will be required to be separately rec-
ognized if the benefit of the intangible asset can be sold, transferred, licensed, rented,
or exchanged. Amortization of these intangibles over their useful lives is required.
The Company has elected to adopt SFAS 142 as of the beginning of fiscal 2002. The
Company is currently assessing the impact of adopting SFAS 142 and believes,
excluding impairments, net income for fiscal year 2002 will be increased, since good-
will is no longer subject to amortization, by approximately $2.5 million.
In August 2001, the FASB issued SFAS No. 144, Accounting for Impairment or
Disposal of Long-Lived Assets (SFAS 144). SFAS 144 establishes a single accounting
model for long-lived assets to be disposed of by sale and provides additional imple-
mentation guidance for assets to be held and used and assets to be disposed of other
than by sale. There will be no financial implication related to the adoption of SFAS
144, and the guidance will be applied on a prospective basis. The Company is
required to adopt SFAS 144 in the first quarter of fiscal 2003.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES
ABOUT MARKET RISK
Information with respect to this item is included in Management’s Discussion and
Analysis of Financial Condition and Results of Operations under the heading
“Market Risk Management.”
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Information with respect to this item is included on pages F-1 to F-19.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
None.
11
PA R T I I I
PA R T I V
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information with respect to this item, except for certain information on executive offi-
cers (which appears at the end of Part I of this report) is included in the Company’s
Proxy Statement for its February 19, 2002 Annual Meeting of Shareholders, which is
incorporated herein by reference, under the headings “Election of Directors” and
“Section 16(a) Beneficial Ownership Reporting Compliance,” provided, however,
that the subsection entitled “Election of Directors – Audit Committee Report” shall
not be deemed to be incorporated herein by reference.
ITEM 11. EXECUTIVE COMPENSATION
Information with respect to this item is included in the Company’s Proxy Statement
for its February 19, 2002 Annual Meeting of Shareholders, which is incorporated
herein by reference, under the headings “Election of Directors - Compensation of
Directors” and “Executive Compensation;” provided, however, that the subsection
entitled “Executive Compensation - Compensation Committee Report on Executive
Compensation” shall not be deemed to be incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
Information with respect to this item is included in the Company’s Proxy Statement for
its February 19, 2002 Annual Meeting of Shareholders, which is incorporated herein by
reference, under the heading “Stock Ownership of Management and Others.”
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information with respect to this item is included in the Company’s Proxy Statement
for its February 19, 2002 Annual Meeting of Shareholders, which is incorporated
herein by reference, under the heading “Certain Transactions.”
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES
AND REPORTS ON FORM 8-K
8-K The following documents are filed as a part of this Form 10-K:
Financial Statements
Included in Item 8 of Part II of this Form 10-K are the following
Reports of Independent Public Accountants
Consolidated Balance Sheets - September 28, 2001 and September 29, 2000
Consolidated Statements of Operations -
Years ended September 28, 2001, September 29, 2000 and October 1, 1999
Consolidated Statements of Shareholders’ Equity -
Years ended September 28, 2001, September 29, 2000 and October 1, 1999
Consolidated Statements of Cash Flows -
Years ended September 28, 2001, September 29, 2000 and October 1, 1999
Notes to Consolidated Financial Statements
Financial Statement Schedules
All schedules are omitted because they are not applicable, are not required or equiv-
alent information has been included in the Consolidated Financial Statements or
notes thereto.
Exhibits
See Exhibit Index.
Reports on Form 8-K
No reports on Form 8-K were filed during the three months ended September 28, 2001.
12
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized, in the Town of Mount Pleasant and State
of Wisconsin, on the 13th day of December 2001.
JOHNSON OUTDOORS INC.
(Registrant)
By /s/ Helen P. Johnson-Leipold
Helen P. Johnson-Leipold
Chairman and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has
been signed by the following persons in the capacities indicated on the 13th day of
December 2001.
/s/ Helen P. Johnson-Leipold
(Helen P. Johnson-Leipold)
Chairman and Chief Executive
Officer and Director
(Principal Executive Officer)
/s/ Thomas F. Pyle, Jr.
(Thomas F. Pyle, Jr.)
/s/ Samuel C. Johnson
(Samuel C. Johnson)
/s/ Gregory E. Lawton
(Gregory E. Lawton)
/s/ Glenn N. Rupp
(Glenn N. Rupp)
/s/ Terry E. London
(Terry E. London)
(John M. Fahey, Jr.)
/s/ Paul A. Lehmann
(Paul A. Lehmann)
Vice Chairman of the Board
and Director
Director
Director
Director
Director
Director
Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
13
EXHIBIT INDEX
Exhibit
Title
Page No.
Exhibit
Title
Page No.
3.1 Articles of Incorporation of the Company as amended through
February 17, 2000. (Filed as Exhibit 3.1(a) to the Company’s
Form 10-Q for the quarter ended March 31, 2000 and incorporated
herein by reference.)
3.2 Bylaws of the Company as amended through March 22, 2000.
(Filed as Exhibit 3.2(a) to the Company’s Form 10-Q for the quarter
ended March 31, 2000 and incorporated herein by reference.)
4.1 Note Agreement dated October 1, 1995. (Filed as Exhibit 4.1 to
Company’s Form 10-Q for the quarter ended December 29, 1995
and incorporated herein by reference.)
4.2 First Amendment dated October 31, 1996 to Note Agreement
dated October 1, 1995. (Filed as Exhibit 4.3 to the Company’s Form
10-Q for the quarter ended December 27, 1996 and incorporated
herein by reference.)
4.3 Second Amendment dated September 30, 1997 to Note Agreement
dated October 1, 1995. (Filed as Exhibit 4.8 to the Company’s
Form 10-K for the year ended October 3, 1997 and incorporated
herein by reference.)
4.4 Third Amendment dated October 3, 1997 to Note Agreement
dated October 1, 1995. (Filed as Exhibit 4.9 to the Company’s
Form 10-K for the year ended October 3, 1997 and incorporated
herein by reference.)
4.5 Fourth Amendment dated January 10, 2000 to Note Agreement
dated October 1, 1995. (Filed as Exhibit 4.9 to the Company’s
Form 10-Q for the quarter ended March 31, 2000 and incorporated
herein by reference.)
4.6 Fifth Amendment dated December 13, 2001 to Note Agreement
dated October 1, 1995.
*
*
*
*
*
*
*
*
14
4.7 Note Agreement dated as of September 15, 1997. (Filed as
Exhibit 4.15 to the Company’s Form 10-K for the year ended
October 3, 1997 and incorporated herein by reference.)
4.8 First Amendment dated January 10, 2000 to Note Agreement
dated September 15, 1997. (Filed as Exhibit 4.10 to the
Company’s Form 10-Q for the quarter ended March 31, 2000
and incorporated herein by reference.)
4.9 Second Amendment dated December 13, 2001 to Note
Agreement dated September 15, 1997.
4.10 3-Year Revolving Credit Agreement dated as of August 31, 2001.
4.11 Amendment No. 1 to 3-Year Revolving Credit Agreement dated
as of December 18, 2001.
4.12 Note Agreement dated as of December 13, 2001.
9
Johnson Outdoors Inc. Class B common stock Voting Trust
Agreement, dated December 30, 1993 (Filed as Exhibit 9 to
the Company’s Form 10-Q for the quarter ended December 31,
1993 and incorporated herein by reference.)
10.1 Stock Purchase Agreement, dated as of January 12, 2000, by
and between Johnson Outdoors Inc. and Berkley Inc. (Filed as
Exhibit 2.1 to the Company’s Form 8-K dated March 31, 2000
and incorporated herein by reference.)
10.2 Amendment to Stock Purchase Agreement, dated as of February 28,
2000, by and between Johnson Outdoors Inc. and Berkley Inc.
(Filed as Exhibit 2.2 to the Company’s Form 8-K dated March 31,
2000 and incorporated herein by reference.)
10.3 Johnson Outdoors Inc. Amended and Restated 1986 Stock Option
Plan. (Filed as Exhibit 10 to the Company’s Form 10-Q for the
quarter ended July 2, 1993 and incorporated herein by reference.)
*
*
**
**
**
**
*
*
*
*
Title
Page No.
Exhibit
Title
Page No.
Exhibit
10.4
*
*
Registration Rights Agreement regarding Johnson Outdoors Inc.
common stock issued to the Johnson family prior to the acquisition
of Johnson Diversified, Inc. (Filed as Exhibit 10.6 to the Company’s
Form S-1 Registration Statement No. 33-16998 and incorporated
herein by reference.)
10.5
Registration Rights Agreement regarding Johnson Outdoors Inc.
Class A common stock held by Mr. Samuel C. Johnson. (Filed
as Exhibit 28 to the Company’s Form 10-Q for the quarter ended
March 29, 1991 and incorporated herein by reference.)
10.6+ Form of Restricted Stock Agreement. (Filed as Exhibit 10.8 to the *
Company’s Form S-1 Registration Statement No. 33-23299 and
incorporated herein by reference.)
10.7+ Form of Supplemental Retirement Agreement of Johnson
*
Diversified, Inc. (Filed as Exhibit 10.9 to the Company’s Form
S-1 Registration Statement No. 33-16998 and incorporated herein
by reference.)
10.8+
Johnson Outdoors Retirement and Savings Plan. (Filed as Exhibit *
10.9 to the Company’s Form 10-K for the year ended September 29,
1989 and incorporated herein by reference.)
10.9+ Form of Agreement of Indemnity and Exoneration with Directors *
and Officers. (Filed as Exhibit 10.11 to the Company’s Form S-1
Registration Statement No. 33-16998 and incorporated herein
by reference.)
10.10 Consulting and administrative agreements with S. C. Johnson &
*
Son, Inc. (Filed as Exhibit 10.12 to the Company’s Form S-1
Registration Statement No. 33-16998 and incorporated herein
by reference.)
10.12+ Johnson Outdoors Inc. 1994 Non-Employee Director Stock
Ownership Plan. (Filed as Exhibit 4 to the Company’s Form S-8
Registration Statement No. 333-88089 and incorporated herein
by reference.)
10.13+ Johnson Outdoors Economic Value Added Bonus Plan (Filed as
Exhibit 10.15 to the Company’s Form 10-K for the year ended
October 3, 1997 and incorporated herein by reference.)
10.14+ Johnson Outdoors Inc. 2000 Long-Term Stock Incentive Plan.
*
*
*
(Filed as Exhibit 10.16 to the Company’s Form 10-Q for the
quarter ended March 31, 2000 and incorporated herein by reference.)
11.
Statement regarding computation of per share earnings. (Note 15 *
to the Consolidated Financial Statements of the Company’s 2001
Form 10-K is incorporated herein by reference.)
21.
Subsidiaries of the Company as of September 28, 2001.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of KPMG LLP
**
**
**
99.
Definitive Proxy Statement for the 2002 Annual Meeting of
Shareholders. Except to the extent specifically incorporated herein
by reference, the Proxy Statement for the 2002 Annual Meeting of
Shareholders shall not be deemed to be filed with the Securities and
Exchange Commission as part of this Form 10-K. The Proxy Statement
for the 2002 Annual Meeting of Shareholders will be filed with the
Securities and Exchange Commission under regulation 14A within
120 days after the end of the Company’s fiscal year.
*
10.11+ Johnson Outdoors Inc. 1994 Long-Term Stock Incentive Plan.
(Filed as Exhibit 4 to the Company’s Form S-8 Registration
Statement No. 333-88091 and incorporated herein by reference.)
*
** Incorporated herein by reference.
** Exhibits not included in this annual report.
*+ A management contract or compensatory plan or arrangement.
15
CONSOLIDATED FINANCIAL STATEMENTS
REPORT OF MANAGEMENT
Table of Contents
Page
Report of Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-1
Report of Independent Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . .F-2
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-3
Consolidated Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-4
Consolidated Statements of Shareholders’ Equity . . . . . . . . . . . . . . . . . . . . . .F-5
Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-6
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . .F-7
The management of Johnson Outdoors Inc. is responsible for the preparation and
integrity of all financial statements and other information contained in this Form
10-K. We rely on a system of internal financial controls to meet the responsibility of
providing accurate financial statements. The system provides reasonable assurances
that assets are safeguarded, that transactions are executed in accordance with man-
agement’s authorization and that the financial statements are prepared on a world-
wide basis in accordance with accounting principles generally accepted in the United
States of America.
The financial statements for each of the years covered in this Form 10-K have been
audited by independent public accountants, who have provided an independent
assessment as to the fairness of the financial statements, after obtaining an under-
standing of the Company’s systems and procedures and performing such other tests
as deemed necessary.
The Audit Committee of the Board of Directors, which is composed solely of direc-
tors who are not officers of the Company, meets with management and the inde-
pendent public accountants to review the results of their work and to satisfy itself
that their respective responsibilities are being properly discharged. The independent
public accountants have full and free access to the Audit Committee and have regu-
lar discussions with the Committee regarding appropriate auditing and financial
reporting matters.
Helen P. Johnson-Leipold
Chairman and Chief Executive Officer
Paul A. Lehmann
Vice President and Chief Financial Officer
F-1
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
INDEPENDENT AUDITORS’ REPORT
Shareholders and Board of Directors
Johnson Outdoors Inc.:
Shareholders and Board of Directors
Johnson Outdoors Inc.:
We have audited the consolidated balance sheet of Johnson Outdoors Inc. and sub-
sidiaries as of September 28, 2001 and the related consolidated statements of opera-
tions, shareholders’ equity, and cash flows for the year then ended. These
consolidated financial statements are the responsibility of the Company’s manage-
ment. Our responsibility is to express an opinion on these consolidated financial
statements based on our audit.
We have audited the consolidated balance sheet of Johnson Outdoors Inc. and sub-
sidiaries as of September 29, 2000 and the related consolidated statements of opera-
tions, shareholders’ equity, and cash flows for each of the years in the two-year period
ended September 29, 2000. These consolidated financial statements are the respon-
sibility of the Company’s management. Our responsibility is to express an opinion
on these consolidated financial statements based on our audits.
We conducted our audit in accordance with auditing standards generally accepted in
the United States of America. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence sup-
porting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our opinion.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Johnson Outdoors Inc. and sub-
sidiaries as of September 28, 2001 and the results of their operations and their cash
flows for the year then ended in conformity with accounting principles generally
accepted in the United States of America.
As explained in Note 1 to the consolidated financial statements, effective September
30, 2000, the Company changed its method of accounting for derivative instruments.
In our opinion, the consolidated financial statements referred to above present fairly,
in all material respects, the financial position of Johnson Outdoors Inc. and sub-
sidiaries as of September 29, 2000 and the results of their operations and their cash
flows for each of the years in the two-year period ended September 29, 2000, in con-
formity with accounting principles generally accepted in the United States of
America.
Arthur Andersen LLP
Milwaukee, Wisconsin
November 8, 2001, except for Notes 5 and 17,
as to which the date is December 21, 2001.
KPMG LLP
Milwaukee, Wisconsin
November 6, 2000
F-2
CONSOLIDATED BALANCE SHEETS
(thousands, except share data)
Assets
Current assets:
Cash and temporary cash investments
Accounts receivable, less allowance for doubtful accounts of $3,739 and $3,895, respectively
Inventories
Deferred income taxes
Other current assets
Total current assets
Property, plant and equipment, net
Deferred income taxes
Intangible assets, net
Other assets
Total assets
Liabilities And Shareholders’ Equity
Current liabilities:
Short-term debt and current maturities of long-term debt
Accounts payable
Accrued liabilities:
Salaries and wages
Income taxes
Other
Total current liabilities
Long-term debt, less current maturities
Other liabilities
Total liabilities
Shareholders’ equity:
Preferred stock: none issued
Common stock:
Class A shares issued: September 28, 2001, 6,946,012; September 29, 2000, 6,924,630
Class B shares issued (convertible into Class A shares): September 28, 2001, 1,222,729; September 29, 2000, 1,222,729
Capital in excess of par value
Retained earnings
Contingent compensation
Accumulated other comprehensive income - cumulative translation adjustment
Total shareholders’ equity
Total liabilities and shareholders’ equity
The accompanying notes are an integral part of the Consolidated Financial Statements.
F-3
September 28
2001
September 29
2000
$ 16,069
45,585
61,700
5,269
4,557
133,180
35,879
19,577
55,288
989
$ 244,913
$ 12,985
12,157
5,968
1,206
17,237
49,553
84,550
5,031
139,134
—
347
61
44,411
80,162
(44)
(19,158)
105,779
$ 244,913
$ 17,363
54,825
62,708
4,613
4,685
144,194
37,369
17,311
57,866
1,231
$ 257,971
$ 59,462
12,928
7,421
140
26,452
106,403
45,857
4,879
157,139
—
346
61
44,291
74,797
(77)
(18,586)
100,832
$ 257,971
CONSOLIDATED STATEMENTS OF OPERATIONS
(thousands, except per share data)
Net sales
Cost of sales
Gross profit
Operating expenses:
Marketing and selling
Administrative management, finance and information systems
Research and development
Amortization of acquisition costs
Profit sharing
Strategic charges
Total operating expenses
Operating profit
Interest income
Interest expense
Other expense, net
Income from continuing operations before income taxes and before cumulative
effect of change in accounting principle
Income tax expense
Income from continuing operations before cumulative effect of change in
accounting principle
Income (loss) from discontinued operations, net of income tax expense (benefit)
of $(563) and $771 for 2000 and 1999, respectively
Loss on disposal of discontinued operations, net of income tax benefit of $1,840
Effect of change in accounting principle, net of income tax expense of $845
Net income (loss)
Basic earnings (loss) per common share:
Continuing operations
Discontinued operations
Net effect of change in accounting principle
Net income (loss)
Diluted earnings (loss) per common share:
Continuing operations
Discontinued operations
Net effect of change in accounting principle
Net income (loss)
The accompanying notes are an integral part of the Consolidated Financial Statements.
September 28
2001
$ 345,637
208,934
136,703
76,114
29,138
7,565
5,288
1,432
1,448
120,985
15,718
(548)
9,085
1,091
6,090
2,480
3,610
—
—
1,755
5,365
0.44
—
0.22
0.66
0.44
—
0.22
0.66
$
$
$
$
$
September 29
2000
$354,889
212,076
142,813
73,685
28,442
7,854
2,951
2,793
2,369
118,094
24,719
(421)
9,799
261
15,080
6,705
8,375
(940)
(24,418)
—
$ (16,983)
$
$
$
$
1.03
(3.12)
—
(2.09)
1.03
(3.12)
—
(2.09)
Year Ended
October 1
1999
$310,198
184,424
125,774
64,930
26,372
6,878
2,912
2,396
2,773
106,261
19,513
(294)
9,565
223
10,019
4,158
5,861
1,161
—
—
7,022
0.72
0.15
—
0.87
0.72
0.15
—
0.87
$
$
$
$
$
F-4
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(thousands)
Common
Stock
Capital in
Excess of
Par Value
Retained
Earnings
Contingent
Compensation
Balance at October 2, 1998
$406
$ 44,205
$ 85,068
Net income
Issuance of restricted stock
Issuance of stock under employee stock purchase plan
Amortization of contingent compensation
Translation adjustment
—
—
—
—
—
—
—
—
—
—
Balance at October 1, 1999
406
44,205
Net loss
Issuance of restricted stock
Issuance of stock under employee stock purchase plan
Amortization of contingent compensation
Translation adjustment
Translation adjustment reclassified to net loss
on sale of Fishing business
—
—
1
—
—
—
—
19
67
—
—
—
Balance at September 29, 2000
407
44,291
Net income
Issuance of restricted stock
Issuance of stock under employee stock purchase plan
Amortization of contingent compensation
Translation adjustment
Translation adjustment reclassified to cumulative effect
of change in accounting principle
—
—
1
—
—
—
—
50
70
—
—
—
7,022
(137)
(121)
—
—
91,832
(16,983)
—
(52)
—
—
—
74,797
5,365
—
—
—
—
—
$ (27)
—
(182)
—
75
—
(134)
—
(19)
—
76
—
—
(77)
—
(50)
—
83
—
—
Accumulated
Other
Comprehensive
Loss-Cumulative
Translation
Adjustment
$ (4,651)
—
—
—
—
(4,398)
(9,049)
—
—
—
—
(10,346)
809
(18,586)
—
—
—
—
2,402
(2,974)
Treasury
Stock
$(615)
—
319
214
—
—
(82)
—
—
82
—
—
—
—
—
—
—
—
—
—
Comprehensive
Income (Loss)
$
7,022
—
—
—
(4,398)
$
2,624
$ (16,983)
—
—
—
(10,346)
—
$ (27,329)
$ 5,365
—
—
—
2,402
—
BALANCE AT SEPTEMBER 28, 2001
$408
$44,411
$80,162
$(44)
$(19,158)
$ —
$ 7,767
The accompanying notes are an integral part of the Consolidated Financial Statements.
F-5
CONSOLIDATED STATEMENTS OF CASH FLOWS
(thousands)
Cash Provided By Operations
Net income (loss)
Less income (loss) from discontinued operations
Less income from cumulative effect of change in accounting principle
Income from continuing operations
Adjustments to reconcile income from continuing operations to net cash
provided by operating activities of continuing operations:
Depreciation and amortization
Provision for doubtful accounts receivable
Provision for inventory reserves
Deferred income taxes
Impairment of goodwill
Change in assets and liabilities, net of effect of businesses acquired or sold:
Accounts receivable
Inventories
Accounts payable and accrued liabilities
Other, net
Cash Provided By (Used For) Investing Activities
Proceeds from sale of business, net of cash
Payments for purchase of businesses, net of cash acquired
Net additions to property, plant and equipment
Sales of property, plant and equipment
Cash Used For Financing Activities
Principal payments on senior notes and other long-term debt
Net change in short-term debt
Common stock transactions
Effect of foreign currency fluctuations on cash
Net cash provided by (used for) discontinued operations
Increase (decrease) in cash and temporary cash investments
Cash And Temporary Cash Investments
Beginning of year
End of year
The accompanying notes are an integral part of the Consolidated Financial Statements.
September 28
2001
September 29
2000
$ 5,365
—
1,755
3,610
13,516
2,460
1,529
(2,922)
2,526
6,780
124
(11,391)
(760)
15,472
—
(573)
(9,765)
730
(9,608)
(6,784)
(1,143)
71
(7,856)
698
—
(1,294)
$(16,983)
(25,358)
—
8,375
12,523
1,812
853
(374)
—
(10,728)
(8,358)
3,910
1,738
9,751
33,126
(864)
(14,075)
1,838
20,025
(21,969)
9,351
97
(12,521)
(1,790)
(8,076)
7,389
Year Ended
October 1
1999
$ 7,022
1,161
—
5,861
12,597
2,162
801
(48)
—
(3,466)
1,012
5,975
(106)
24,788
—
(13,584)
(13,035)
501
(26,118)
(7,705)
6,764
94
(847)
(541)
2,361
(357)
17,363
$ 16,069
9,974
$ 17,363
10,331
$ 9,974
F-6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Johnson Outdoors Inc. is an integrated, global outdoor recreation products com-
pany engaged in the design, manufacture and marketing of brand name outdoor
equipment, diving, watercraft and motors products.
All monetary amounts, other than share and per share amounts, are stated in thou-
sands and are from continuing operations.
1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The Consolidated Financial Statements include the accounts of Johnson Outdoors
Inc. and all majority owned subsidiaries (the Company) and are stated in conform-
ity with accounting principles generally accepted in the United States of America.
Significant intercompany accounts and transactions have been eliminated in con-
solidation.
The preparation of financial statements requires management to make estimates and
assumptions that impact the reported amounts of assets, liabilities and operating
results and the disclosure of commitments and contingent liabilities. Actual results
could differ significantly from those estimates. For the Company, significant esti-
mates include the allowance for doubtful accounts receivable, reserves for inventory
valuation, reserves for sales returns and the valuation allowance for deferred tax
assets.
The Company’s fiscal year ends on the Friday nearest September 30. The fiscal years
ended September 28, 2001 (hereinafter 2001) and September 29, 2000 (hereinafter
2000) and October 1, 1999 (hereinafter 1999) each comprise 52 weeks.
Cash and Temporary Cash Investments
For purposes of the consolidated statements of cash flows, the Company considers all
short-term investments in interest-bearing bank accounts, securities and other instru-
ments with an original maturity of three months or less to be equivalent to cash.
The Company maintains cash in bank accounts in excess of insured limits. The
Company has not experienced any losses as a result of this practice and does not
believe that significant credit risk exists.
Inventories
Inventories are stated at the lower of cost (determined using the first-in, first-out
method) or market.
Inventories attributable to continuing operations at the end of the respective years
consist of the following:
Raw materials
Work in process
Finished goods
Less reserves
2001
$ 19,892
2,592
42,620
65,104
3,404
$ 61,700
2000
$23,122
2,238
40,297
65,657
2,949
$62,708
Property, Plant and Equipment
Property, plant and equipment are stated at cost less accumulated depreciation.
Depreciation of plant and equipment is determined by straight-line and accelerated
methods over estimated useful lives, which range from 3 to 30 years.
Upon retirement or disposition, cost and the related accumulated depreciation are
removed from the accounts and any resulting gain or loss is recognized in operating
results.
Property, plant and equipment attributable to continuing operations at the end of
the respective years consist of the following:
Property and improvements
Buildings and improvements
Furniture, fixtures and equipment
Less accumulated depreciation
2001
$ 1,423
21,861
86,221
109,505
73,626
$ 35,879
2000
$ 1,423
19,303
82,994
103,720
66,351
$ 37,369
F-7
Intangible Assets
Intangible assets are stated at cost less accumulated amortization. Amortization is
computed using the straight-line method with periods ranging from 15 to 40 years
for goodwill and 3 to 16 years for patents, trademarks and other intangible assets.
Intangible assets attributable to continuing operations at the end of the respective
years consist of the following:
Federal and state income taxes are provided on foreign subsidiary income distributed
to, or taxable in, the United States during the year. At September 28, 2001, net
undistributed earnings of foreign subsidiaries total approximately $63,200. A sub-
stantial portion of these unremitted earnings have been permanently invested
abroad and no provision for federal or state taxes is made on these amounts. With
respect to that portion of foreign earnings which may be returned to the United
States, provision is made for taxes if the amounts are significant.
Goodwill
Patents, trademarks and other
Less accumulated amortization
2001
$ 68,830
4,275
73,105
17,817
$ 55,288
2000
$69,546
4,122
73,668
15,802
$57,866
Impairment of Long-Lived Assets
The Company annually assesses the recoverability of property, plant and equipment
and intangible assets, primarily by determining whether the depreciation and amor-
tization of the balance over its remaining life can be recovered through projected
undiscounted future operating cash flows of the related businesses. The amount of
impairment, if any, is measured primarily based on the deficiency of projected dis-
counted future operating cash flows relative to the value of the assets, using a dis-
count rate reflecting the Company’s cost of capital, which currently approximates
10%. In 2001, the Company recognized a $2.5 million write-down for impaired
goodwill related to the Airguide brand in the Motors business.
Income Taxes
The Company provides for income taxes currently payable, and deferred income
taxes resulting from temporary differences between financial statement and taxable
income, using the asset and liability method.
In assessing the realizability of deferred tax assets, the Company 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 years in which those temporary dif-
ferences become deductible. The Company considers the scheduled reversal of
deferred tax liabilities, projected future taxable income and tax planning strategies
in making this assessment.
The Company’s United States entities file a consolidated federal income tax return.
Employee Benefits
The Company and certain of its subsidiaries have various retirement and profit shar-
ing plans. Pension obligations, which are generally based on compensation and years
of service, are funded by payments to pension fund trustees. The Company’s policy
is generally to fund the minimum amount required under the Employee Retirement
Income Security Act of 1974 for plans subject thereto. Profit sharing and other
retirement costs are funded at least annually.
Foreign Operations and Derivative Financial Instruments
Assets and liabilities of foreign operations are translated into U.S. dollars at the rate
of exchange existing at the end of the year. Results of operations are translated at
monthly average exchange rates. Gains and losses resulting from the translation of
foreign currency financial statements are classified as accumulated other compre-
hensive income (loss), a separate component of shareholders’ equity.
The Company operates internationally, which gives rise to exposure to market risk
from movements in foreign currency exchange rates. To minimize the effect of fluc-
tuating foreign currencies on its income, the Company enters into foreign currency
forward contracts. The Company primarily hedges assets, inventory purchases and
loans denominated in foreign currencies. The Company does not enter into foreign
exchange contracts for trading purposes. Gains and losses on unhedged exposures
are recorded in operating results.
The contracts are used to hedge known foreign currency transactions on a continu-
ing basis for periods consistent with the Company’s exposures. Beginning September
30, 2000 upon the adoption of SFAS 133, Accounting for Derivative Instruments and
Hedging Activities, as amended by SFAS 137, Accounting for Derivative Instruments
and Hedging Activities – Deferral of the Effective Date of SFAS Statement No. 133 and
SFAS 138, Accounting for Certain Derivative Instruments and Certain Hedging
Activities, the effective portion of the gain or loss on the foreign currency forward
F-8
contact is reported as a component of other comprehensive income and reclassified
into earnings in the same period during which the hedged transaction affects earn-
ings. The remaining gain or loss on the futures contact, if any, is recognized in cur-
rent earnings during the period of changes. Adoption of these new accounting
standards resulted in a cumulative after-tax gain of approximately $1.8 million and
an accumulated other comprehensive loss of approximately $3.0 million in the first
quarter of fiscal 2001.
At September 28, 2001, foreign currency contracts with contractual amounts total-
ing approximately $6,500 are in place, hedging existing and anticipated transac-
tions. The contracts, which are executed with major financial institutions, generally
mature within one year with no credit loss anticipated for failure of the counterpar-
ties to perform. At September 28, 2001, the fair value of these instruments is
approximately $200 greater than the contractual amount.
Revenue Recognition
Revenue from sales is recognized when all substantial risk of ownership transfers to
the customer, which is generally upon shipment of products. Estimated costs of
returns and allowances are accrued when revenue is recognized.
Advertising
The Company expenses substantially all costs related to production of advertising
the first time the advertising takes place. Cooperative promotional arrangements are
accrued in relation to sales.
Advertising expense attributable to continuing operations in 2001, 2000 and 1999
totaled $18,282, $18,435 and $16,258, respectively. Capitalized costs attributable
to continuing operations at September 28, 2001 and September 29, 2000 totaled
$1,653 and $1,360, respectively, and primarily include catalogs and costs of adver-
tising which has not yet run for the first time.
Shipping and Handling Costs
In July 2000, the Emerging Issues Task Force (EITF) reached a consensus on Issue
00-10, Accounting for Shipping and Handling Fees and Costs. EITF 00-10 requires
companies to classify as revenues shipping and handling fees billed to customers.
Previously, shipping revenues and shipping expenses were included in marketing and
selling expenses. All periods presented in the Consolidated Statements of Operations
have been reclassified to conform to the current year presentation. The adoption of
this statement increased net sales and marketing and selling expenses by $7,114,
$7,601 and $5,104 for 2001, 2000 and 1999, respectively.
Shipping and handling expense attributable to continuing operations included in
marketing and selling expense was $12,821, $13,007 and $9,525 for 2001, 2000
and 1999, respectively.
Research and Development
Research and development costs are expensed as incurred.
Stock-Based Compensation
The Company accounts for stock options using the intrinsic value based method.
Accordingly, compensation cost is generally recognized only for stock options issued
with an exercise price lower than the market price on the date of grant. The
Company’s practice is to issue options with an exercise price equal to the fair mar-
ket value on the date of the grant. The fair value of restricted shares awarded in
excess of the amount paid for such shares is recognized as contingent compensation
and is amortized over 1 to 3 years from the date of award, the period after which all
restrictions generally lapse.
Pending Accounting Changes
In June 2001, the FASB issued SFAS No. 142 Goodwill and Other Intangibles (SFAS
142). SFAS 142 addresses financial accounting and reporting for goodwill and other
intangible assets subsequent to their acquisition. Upon adoption of SFAS 142, good-
will will no longer be subject to amortization over its estimated useful life. Rather,
goodwill will be subject to at least an annual assessment for impairment by applying
a fair-value-based test. Other intangible assets will be required to be separately recog-
nized if the benefit of the intangible asset can be sold, transferred, licensed, rented, or
exchanged. Amortization of these intangibles over their useful lives is required. The
Company has elected to adopt SFAS 142 as of the beginning of fiscal 2002. The
Company is currently assessing the impact of adopting SFAS 142 and believes,
excluding impairments, net income for fiscal year 2002 will be increased, since
goodwill is no longer subject to amortization, by approximately $2,500.
F-9
In August 2001, the FASB issued SFAS No. 144, Accounting for Impairment or
Disposal of Long-Lived Assets (SFAS 144). SFAS 144 establishes a single accounting
model for long-lived assets to be disposed of by sale and provides additional imple-
mentation guidance for assets to be held and used and assets to be disposed of other
than by sale. There will be no financial implication related to the adoption of SFAS
144, and the guidance will be applied on a prospective basis. The company is
required to adopt SFAS 144 in the first quarter of fiscal 2003.
Reclassifications
Certain reclassifications have been made to prior years’ amounts to conform with
the current year presentation.
2 STRATEGIC CHARGES
In 2001, 2000 and 1999, the Company recorded strategic charges totaling $1,448,
$2,369 and $2,773, respectively.
In 2001 strategic charges included severance, moving and other exit costs related
primarily to the closure and relocation of manufacturing facilities in the Watercraft
business. Severance costs included in the strategic charges totaled $660 and approx-
imately 88 employees were impacted by these actions. Unexpended funds at year
end related to these actions were approximately $1,020.
In 2000 strategic charges included severance, moving and other exit costs related
primarily to the closure and relocation of a manufacturing facility in the Motors
business. Severance costs included in the strategic charges totaled $1,469 and
approximately 95 employees were impacted by these actions. There are no unex-
pended funds related to this action as of the end of 2001.
In 1999, a portion of the charges included severance, moving and recruiting costs
related to the relocation of certain sales and marketing functions of the Company’s
Outdoor Equipment business. The balance of the charges were related to the inte-
gration of acquired businesses. Severance costs included in these charges totaled
$1,101 and approximately 30 employees were impacted. There are no unexpended
funds related to this action as of the end of 2001.
3 ACQUISITIONS
During 2001, the Company completed the acquisition of two small businesses which
manufacture paddles and marine accessories. The initial purchase price, including
direct expenses, for the acquisitions was approximately $600, of which approximately
$420 was recorded as intangible assets and is being amortized over 25 years.
During 2000, the Company completed the acquisition of the common stock of
Pacific Kayak Ltd., a manufacturer of sit-on-top and sea touring kayaks located in
Auckland, New Zealand. The initial purchase price, including direct expenses, for
the acquisition was approximately $962, of which approximately $584 was recorded
as intangible assets and is being amortized over 25 years. An additional payment of
approximately $70 was earned in 2001 based upon achievement of specified levels
of sales of the acquired business.
During 1999, the Company completed the acquisition of the common stock of
Extrasport, Inc., a privately held manufacturer and marketer of personal flotation
devices. The initial purchase price, including direct expenses, for the acquisition was
approximately $3,300, of which approximately $2,500 was recorded as intangible
assets and is being amortized over 25 years. Additional payments of approximately
$150 for both 2000 and 2001 were earned based upon achievement of specified lev-
els of sales. An additional payment in 2002 is dependent upon achievement of spec-
ified levels of sales of the acquired business.
Also during 1999, the Company completed the acquisition of substantially all of the
assets and the assumption of certain liabilities of Escape Sailboat Company LLC, a
privately held manufacturer and marketer of recreational sailboats. The initial pur-
chase price, including direct expenses, for the acquisition was approximately $4,800,
of which approximately $3,100 was recorded as intangible assets and is being amor-
tized over 25 years.
In December 1998, the Company completed the acquisition of substantially all of
the assets and the assumption of certain liabilities of True North Paddle & Necky
Kayaks Ltd., a privately held manufacturer and marketer of Necky kayaks, and an
affiliated entity. The initial purchase price, including direct expenses, for the acqui-
sition was approximately $5,700, of which approximately $3,200 was recorded as
intangible assets and is being amortized over 25 years. Additional payments of
approximately $170 and $600 were earned in 2000 and 1999, respectively.
Additional payments in the years 2002 and 2003 are dependent upon the achieve-
ment of specified levels of sales and profitability of the acquired business.
F-10
All acquisitions were accounted for using the purchase method and, accordingly, the
Consolidated Financial Statements include the results of operations since the respective
dates of acquisition. Additional payments, if required, will increase intangible assets.
4 SALE OF FISHING BUSINESS
In March 2000, the Company sold its Fishing business. As a result, operations and
related assets and liabilities of the Fishing group have been classified as discontinued
for all periods presented herein. The sale price totaled $47,279, including $14,056 of
accounts receivable retained by the Company and $2,367 of debt assumed by the
buyer. The Company recorded a loss of $24,418, net of tax, related to the sale of the
business, taking into account operating results from the measurement date to the date
of disposal. In addition, the Company recorded an after tax loss from operations up
to the measurement date of $940 in 2000, an after tax gain of $1,161 in 1999.
Net sales of the Fishing group were $32,667 and $59,184 for 2000 and 1999,
respectively. Interest expense of $90 and $154 that is directly attributable to the
Fishing group is allocated to discontinued operations.
5 INDEBTEDNESS
Short-term debt at the end of the respective years consists of the following:
Commercial paper and bank loans
Current maturities of long-term debt
Less short-term debt to be refinanced
2001
$ 49,643
13,342
50,000
$ 12,985
2000
$53,434
6,028
—
$59,462
Short-term credit facilities provide for borrowings with interest rates set periodically
by reference to market rates. Commercial paper rates are set by competitive bidding.
The weighted average interest rate on short-term indebtedness was 5.8% and 7.6%
at September 28, 2001 and September 29, 2000, respectively. The Company’s pri-
mary facility is a $70,000 revolving credit agreement expiring in 2004, which
includes a maximum amount of $30,000 in support of commercial paper issuance.
The Company has lines of credit, both foreign and domestic, totaling $92,500 of
which $33,825 is available at September 28, 2001. The Company also utilizes let-
ters of credit for trade financing purposes.
Long-term debt at the end of the respective years consists of the following:
1998 senior notes
1996 senior notes
Short-term debt to be refinanced
Other long-term notes,
maturing through January 2002
Less current maturities
2001
$ 18,800
23,700
50,000
5,392
97,892
13,342
$ 84,550
2000
$16,176
29,700
—
6,009
51,885
6,028
$45,857
In December 2001, subsequent to the end of the 2001 fiscal year, the Company
issued unsecured notes totaling $50,000 with an interest rate of 7.82%. The senior
notes have annual principal payments of $10,000 beginning December 13, 2004
with a final payment due December 13, 2008. Proceeds from the issuance of the
senior notes were used to reduce outstanding indebtedness under the Company’s
primary revolving credit facility. Outstanding short-term debt totaling $50,000 at
September 28, 2001 is classified as long-term in anticipation of refinancing with the
proceeds of the senior notes.
In 1998, the Company issued unsecured senior notes totaling $25,000 with an
interest rate of 7.15%. Simultaneous with the commitment of the 1998 senior
notes, the Company executed a foreign currency swap, denominating in Swiss francs
all principal and interest payments required under the 1998 senior notes. The effec-
tive interest rate paid on the 1998 senior notes as a result of the currency swap was
4.32%. The Company terminated the currency swap in December 2000. A portion
of the proceeds from the divestiture of the Fishing business was used to make an
unscheduled principal payment of $5,335 in March 2000. The 1998 senior notes
have annual principal payments of $2,000 to $7,000 beginning October 2001 with
a final payment due October 2007.
F-11
The Company financed a portion of the initial purchase price for the common stock
of Uwatec AG in 1997 with a note from the sellers. Interest on the deferred amount
is payable annually at 6%. This obligation is denominated in Swiss francs. The out-
standing balance of $5,214 is due in 2002. A corresponding amount of the
Company’s primary revolving credit facility is reserved in support of this obligation
through issuance of a letter of credit.
In 1996, the Company issued unsecured senior notes totaling $30,000 with an
interest rate of 7.77% and $15,000 with an interest rate of 6.98%. A portion of the
proceeds from the divestiture of the Fishing business was used to make an unsched-
uled principal payment of $9,800 in March 2000. Total annual principal payments
ranging from $5,500 to $7,500 are due beginning in October 2000 through 2006.
Aggregate scheduled maturities of long-term debt in each of the five years ending
September 2006 are as follows:
Certain of the Company’s loan agreements require that Samuel C. Johnson, mem-
bers of his family and related entities (hereinafter the Johnson Family) continue to
own stock having votes sufficient to elect a 51% majority of the directors. At
September 28, 2001, the Johnson Family held approximately 3,380,000 shares or
49% of the Class A common stock, approximately 1,168,000 shares or 96% of the
Class B common stock and approximately 78% of the voting power of both classes
of common stock taken as a whole. The agreements also contain restrictive
covenants regarding the Company’s net worth, indebtedness, fixed charge coverage
and distribution of earnings. The Company is in compliance with the restrictive
covenants of such agreements, as amended from time to time.
6 LEASES AND OTHER COMMITMENTS
The Company leases certain operating facilities and machinery and equipment
under long-term, noncancelable operating leases. Future minimum rental commit-
ments under noncancelable operating leases attributable to continuing operations
having an initial term in excess of one year at September 28, 2001 are as follows:
Year
2002
2003
2004
2005
2006
Thereafter
$ 13,342
8,050
9,500
15,700
13,500
37,800
Year
2002
2003
2004
2005
2006
Thereafter
$5,600
3,800
2,600
2,200
2,100
7,600
Interest paid was $9,178, $10,471 and $9,740 for 2001, 2000 and 1999, respectively.
Based on the borrowing rates currently available to the Company for debt with sim-
ilar terms and average maturities, the fair value of the Company’s long-term debt as
of September 28, 2001 and September 29, 2000 is approximately $98,300 and
$53,000, respectively. The carrying value of all other financial instruments approx-
imates the fair value.
Rental expense attributable to continuing operations under all leases was approxi-
mately $6,739, $6,727 and $6,438 for 2001, 2000 and 1999, respectively.
The Company makes commitments in a broad variety of areas, including capital
expenditures, contracts for services, sponsorship of broadcast media and supply of fin-
ished products and components, all of which are in the ordinary course of business.
F-12
7 INCOME TAXES
Income tax expense (benefit) attributable to continuing operations for the respec-
tive years consists of the following:
The tax effects of temporary differences that give rise to significant portions of
deferred tax assets and deferred tax liabilities attributable to continuing operations
at the end of the respective years are presented below:
2001
2000
1999
2001
2000
Current:
Federal
State
Foreign
Deferred
$ —
101
5,301
(2,922)
$ 2,480
$
17
490
6,572
(374)
$6,705
$
34
683
3,489
(48)
$ 4,158
The significant components of deferred tax expense (benefit) attributable to continuing
operations are as follows:
2001
2000
1999
Deferred tax expense (benefit)
(exclusive of effects of other
components listed below)
Increase (decrease) in beginning
of the year balance of the
valuation allowance for
deferred tax assets
$ (3,185)
$ (822)
$
89
263
$ (2,922)
488
$ (374)
(137)
(48)
$
Deferred tax assets:
Inventories
Compensation
Foreign tax credit carryforwards
Net operating loss carryforwards
Other
Total gross deferred tax assets
Less valuation allowance
Deferred tax liabilities:
Foreign statutory reserves
Goodwill and other intangibles
Total deferred tax liabilities
Net deferred tax asset
$ 2,089
2,978
3,761
21,562
5,138
35,528
8,046
27,482
1,867
769
2,636
$ 24,846
$ 1,966
3,502
3,791
16,808
5,869
31,936
7,783
24,153
1,952
277
2,229
$21,924
Deferred tax assets relating to net operating losses of discontinued operation of
$5,555 has been reflected as assets of continuing operations in 2000 as the benefit
will ultimately be realized by the continuing operations.
Following is the income (loss) from continuing operations before income taxes for
domestic and foreign operations:
United States
Foreign
2001
$ (5,719)
11,809
$ 6,090
2000
$ (1,436)
16,516
$15,080
1999
$ (1,269)
11,288
$10,019
F-13
The significant differences between the statutory federal tax rate and the effective
income tax rates for income from continuing operations are as follows:
Statutory U.S. federal
income tax rate
State income taxes, net of
federal income tax benefit
Foreign rate differential
Change in beginning of
year valuation allowance
Foreign operating losses (benefit)
Other
2001
2000
1999
34.0%
34.0%
34.0%
0.9
1.3
4.3
—
0.2
40.7%
3.8
1.4
3.0
0.6
1.7
44.5%
0.7
5.1
—
1.9
(0.2)
41.5%
At September 28, 2001, the Company has $3,761 of foreign tax credit carryfor-
wards available to be offset against future U.S. tax liability. The credits expire in
2002 through 2007 if not utilized. These carryforwards have been fully reserved for
in the valuation allowance.
At September 28, 2001, the Company has a U.S. federal operating loss carryforward
of $40,542 and various state net operating loss carryforwards. During 2001, 2000
and 1999, foreign net operating loss carryforwards were utilized, resulting in a
reduction in income tax expense of $32, $152 and $137, respectively. In addition,
certain of the Company’s foreign subsidiaries have net operating loss carryforwards
totaling $3,120. These amounts are available to offset future taxable income over the
next 14 to 20 years and are anticipated to be utilized during this period.
Taxes paid attributable to continuing operations were $4,337, $9,935 and $6,648
for 2001, 2000 and 1999, respectively.
8 EMPLOYEE BENEFITS
Net periodic pension cost for noncontributory defined benefit pension plans
includes the following components.
Service cost
Interest on projected
benefit obligation
Less return on plan assets
Amortization of unrecognized:
Net loss
Prior service cost
Transition asset
Net amount recognized
2001
$343
792
631
1
26
(80)
$451
2000
$315
763
592
4
26
(81)
$435
1999
$273
713
558
4
26
(81)
$377
The following provides a reconciliation of the changes in the plans benefit obliga-
tion and fair value of assets for 2001 and 2000 and a statement of the funded status
at the end of each year:
2001
2000
Benefit obligation:
Benefit obligation at beginning of year
Service cost
Interest cost
Actuarial (gain) loss
Benefits paid
Benefit obligation at end of year
Fair value of plan assets:
Fair value of plan assets at beginning of year
Actual return on plan assets
Company contributions
Benefits paid
Fair value of plan assets at end of year
Funded status:
Funded status of the plan
Unrecognized net loss
Unrecognized prior service cost
Unrecognized transition asset
Net liability recognized
$10,332
343
792
1,094
(632)
$11,929
$ 8,620
(582)
278
(632)
$ 7,684
$ (4,245)
2,084
123
(211)
$ (2,249)
$ 9,604
315
763
259
(609)
$10,332
$ 8,070
888
271
(609)
$ 8,620
$(1,712)
80
148
(291)
$(1,775)
F-14
The following summarizes the components of the net liability recognized in the con-
solidated balance sheets at the end of the respective years:
10 COMMON STOCK
Common stock at the end of the respective years were as follows:
Prepaid benefit cost
Accrued benefit liability
Net liability recognized
2001
$ —
(2,249)
$(2,249)
2000
$ —
(1,775)
$(1,775)
Plan assets are invested primarily in stock and bond mutual funds and insurance
contracts.
Actuarial assumptions used to determine the projected benefit obligation are as follows:
Discount rate
Long-term rate of return
Average salary increase rate
2001
7.25%
8
5
2000
1999
8%
8
5
8%
8
5
A majority of the Company’s full-time employees are covered by profit sharing and
defined contribution programs. Participating entities determine profit sharing dis-
tributions under various performance and service based formulas.
9 PREFERRED STOCK
The Company is authorized to issue 1,000,000 shares of preferred stock in various
classes and series, of which there are none currently issued or outstanding.
Class A, $.05 par value:
Authorized
Outstanding
Class B, $.05 par value:
Authorized
Outstanding
2001
2000
20,000,000
6,946,012
20,000,000
6,924,630
3,000,000
1,222,729
3,000,000
1,222,729
Holders of Class A common stock are entitled to elect 25% of the members of the
Board of Directors and holders of Class B common stock are entitled to elect the
remaining directors. With respect to matters other than the election of directors or
any matters for which class voting is required by law, holders of Class A common
stock are entitled to one vote per share while holders of Class B common stock are
entitled to ten votes per share. If any dividends (other than dividends paid in shares
of the Company) are paid by the Company on its common stock, a dividend would
be paid on each share of Class A common stock equal to 110% of the amount paid
on each share of Class B common stock. Each share of Class B common stock is con-
vertible at any time into one share of Class A common stock. During 2001, no
shares of Class B common stock were converted into Class A common stock. During
2000 and 1999, respectively, 132 and 1,000 shares of Class B common stock were
converted into Class A common stock.
11 STOCK OWNERSHIP PLANS
The Company’s current stock ownership plans provide for issuance of options to
acquire shares of Class A common stock by key executives and non-employee direc-
tors. All stock options have been granted at a price not less than fair market value at
the date of grant and become exercisable over periods of one to four years from the
date of grant. Stock options generally have a term of 10 years. Current plans also
allow for issuance of restricted stock or stock appreciation rights in lieu of options.
Grants of restricted shares are not significant in any year presented. No stock appre-
ciation rights have been granted.
F-15
A summary of stock option activity related to the Company’s plans is as follows:
Outstanding at October 2, 1998
Granted
Cancelled
Outstanding at October 1, 1999
Granted
Cancelled
Outstanding at September 29, 2000
Granted
Cancelled
Outstanding at September 28, 2001
Shares
602,061
353,000
(176,224)
778,837
268,500
(95,107)
952,230
235,000
(100,435)
1,086,795
Weighted Average
Exercise Price
$ 17.43
8.53
14.67
14.02
7.58
15.23
12.08
5.50
17.00
$10.20
The range of options outstanding at September 28, 2001 is as follows:
Price Range
per Share
$ 5.31–11.50
$12.94–17.50
$18.63–24.38
Number of Options
Outstanding/Exercisable
820,999/331,461
156,222/156,222
109,574/109,574
1,086,795/597,257
Weighted Average
Exercise Price
Outstanding/Exercisable
$ 7.47/$ 8.59
$16.59/$16.59
$21.54/$21.54
$10.20/$13.06
Weighted Average
Remaining Contractual
Life (in years)
8.20
5.75
2.92
7.31
The weighted average fair market value of options granted during the year was $2.18
in 2001, $3.20 in 2000 and $3.31 in 1999.
Had compensation cost for the Company’s stock options been determined using
the fair value method, the Company’s pro forma operating results would have been
as follows:
Income from continuing operations
Diluted earnings per common share
from continuing operations
2001
$3,112
$ 0.38
2000
$7,744
$ 0.95
1999
$5,221
$ 0.64
For purposes of calculating pro forma operating results, the fair value of each option
grant was estimated using the Black-Scholes option pricing model with an expected
volatility of 35%, a risk free rate equivalent to five year U.S. Treasury securities and
an expected life of five years. The pro forma operating results reflect only options
granted after 1995.
The Company’s employee stock purchase plan provides for the issuance of up to
150,000 shares of Class A common stock at a purchase price of not less than 85%
of the fair market value at the date of grant. During 2001, 2000 and 1999 13,382,
16,701, 13,722 shares, respectively, were issued under this plan.
12 RELATED PARTY TRANSACTIONS
Various transactions are conducted between the Company and organizations con-
trolled by the Johnson Family. These include consulting services, office rental, roy-
alties and certain administrative activities. Total net costs of these transactions are
$546, $542, $474 for 2001, 2000 and 1999, respectively.
13 SEGMENTS OF BUSINESS
The Company conducts its worldwide operations through separate global business
units, each of which represent major product lines. Operations are conducted in the
United States and various foreign countries, primarily in Europe, Canada and the
Pacific Basin.
Net sales and operating profit include both sales to customers, as reported in the
Company’s consolidated statements of operations, and interunit transfers, which are
priced to recover cost plus an appropriate profit margin. Identifiable assets represent
assets that are used in the Company’s operations in each business unit at the end of
the years presented. There were no concentrations in revenue from a particular cus-
tomer, product or geographic area in each of the years presented.
F-16
A summary of the Company’s continuing operations by business segment is pre-
sented below:
A summary of the Company’s continuing operations by geographic area is pre-
sented below:
2001
2000
1999
2001
2000
1999
Net sales:
Outdoor equipment:
Net sales:
United States:
Unaffiliated customers
Interunit transfers
$114,875
89
$104,052
67
$ 92,951
14
Unaffiliated customers
Interarea transfers
$228,491
5,828
Europe:
Unaffiliated customers
Interarea transfers
Other
Interarea transfers
Eliminations
Identifiable assets:
United States
Europe
Other
89,995
7,267
27,151
7,170
(20,265)
$345,637
$133,659
94,490
16,764
$244,913
Watercraft:
Unaffiliated customers
Interunit transfers
Diving:
Unaffiliated customers
Interunit transfers
Motors:
Unaffiliated customers
Interunit transfers
Other
Eliminations
Operating profit (loss):
Outdoor equipment
Watercraft
Diving
Motors
Other
Identifiable assets:
Outdoor equipment
Watercraft
Diving
Motors
Other
85,841
343
80,426
62
64,446
539
49
(1,033)
$345,637
$ 12,015
1,293
11,638
231
(9,459)
$ 15,718
$ 49,027
65,147
85,393
22,819
22,527
$244,913
90,178
397
82,840
5
76,680
1,363
1,139
(1,832)
$354,889
$ 8,182
10,327
10,832
3,936
(8,558)
$ 24,719
$ 49,512
63,394
87,818
30,208
27,039
$257,971
70,160
260
80,610
9
64,671
1,783
1,806
(2,066)
$310,198
$ 3,546
12,598
4,749
3,497
(4,877)
$ 19,513
$195,461
6,622
90,772
6,510
23,965
5,495
(18,627)
$310,198
$239,079
6,540
88,567
7,800
27,243
7,863
(22,203)
$354,889
$148,186
91,684
18,101
$257,971
F-17
14 VALUATION AND QUALIFYING ACCOUNTS
The following summarizes changes to valuation and qualifying accounts:
The following sets forth the computation of basic and diluted earnings per common
share:
Additions
Balance at Charged to
Costs and
Beginning
Expenses
of Year
Reserves of
Businesses
Acquired
or Sold
Less
Deductions
Balance
at End
of Year
Year ended
September 28, 2001:
Allowance for
doubtful accounts
$3,895
$2,460
$ —
$2,616 $3,739
Reserves for
inventory valuation
2,949
1,529
—
1,074
3,404
Year ended
September 29, 2000:
Allowance for
doubtful accounts
3,236
1,812
Reserves for
inventory valuation
Year ended October 1, 1999:
Allowance for
4,911
853
doubtful accounts
2,153
2,161
Reserves for
inventory valuation
5,196
801
—
—
14
—
1,153
3,895
2,815
2,949
1,092
3,236
1,806
4,911
Deductions include the net impact of foreign currency fluctuations on the respec-
tive accounts.
15 EARNINGS PER SHARE
Basic earnings per share excludes any dilutive effects of options, warrants and con-
vertible securities. Diluted earnings per share is similar to the previously reported
fully diluted earnings per share.
Income from continuing operations
before cumulative effect of change
in accounting principle for basic
and diluted earnings per share
Weighted average shares outstanding
Less nonvested restricted stock
Basic average common shares
Dilutive stock options and restricted stock
Diluted average common shares
Basic earnings per common share from
continuing operations before
cumulative effect of change in
accounting principle
Diluted earnings per common share from
continuing operations before
cumulative effect of change in
accounting principle
2001
2000
1999
$3,610
8,161,624
15,162
8,146,462
23,227
8,169,739
$8,375
8,139,340
17,265
8,122,075
8,208
8,130,283
$5,861
8,108,781
12,206
8,096,575
11,653
8,108,228
$0.66
$1.03
$0.72
$0.66
$1.03
$0.72
16 LITIGATION
The Company is subject to various legal actions and proceedings in the normal
course of business, including those related to environmental matters. The Company
is insured against loss for certain of these matters. Although litigation is subject to
many uncertainties and the ultimate exposure with respect to these matters cannot
be ascertained, management does not believe the final outcome will have a material
adverse effect on the financial condition, results of operations, liquidity or cash flows
of the Company.
17 SUBSEQUENT EVENT
In November 2001, subsequent to the end of the 2001 fiscal year, the Company
completed the sale and leaseback of their headquarters facility in Sturtevant,
Wisconsin to an affiliated party. Proceeds from the sale were $5.0 million.
F-18
18 QUARTERLY FINANCIAL SUMMARY (unaudited)
The following summarizes quarterly operating results:
Net Sales
Gross profit
Operating profit loss
Income (loss) from continuing operations
before cumulative effect of change
in accounting principle
Loss from discontinued operations
Loss on disposal of discontinued operations
Cumulative effect of change in accounting
principle, net of tax
Net income (loss)
Basic earnings (loss) per common share:
Continuing operations
Discontinued operations
Cumulative effect of change in
accounting principle, net of tax
Net income (loss)
Diluted earnings (loss) per common share:
Continuing operations
Discontinued operations
Cumulative effect of change in
accounting principle, net of tax
Net income (loss)
2001
$ 58,750
23,324
(3,569)
First Quarter
2000
$57,299
23,010
139
Second Quarter
2001
$ 98,719
39,358
6,595
2000
$ 98,734
41,101
9,584
2001
$ 113,927
46,552
13,000
Third Quarter
2000
$116,662
47,996
13,912
(3,229)
—
—
(1,035)
(940)
(23,109)
2,203
—
—
3,896
—
(1,309)
1,755
$ (1,474)
—
$(25,084)
—
$ 2,203
—
$ 2,587
$
$
$
$
(0.40)
—
0.22
(0.18)
(0.40)
—
0.22
(0.18)
$ (0.13)
(2.96)
—
$ (3.09)
$ (0.13)
(2.96)
—
$ (3.09)
$
$
$
$
0.27
—
—
0.27
0.27
—
—
0.27
$
$
$
$
0.48
(0.16)
—
0.32
0.48
(0.16)
—
0.32
6,283
—
—
—
6,283
0.77
—
—
0.77
0.77
—
—
0.77
$
$
$
$
$
5,958
—
—
—
5,958
0.73
—
—
0.73
0.73
—
—
0.73
$
$
$
$
$
Fourth Quarter
2001
$ 74,241
27,469
(308)
2000
$82,194
30,706
1,084
(1,647)
—
—
—
$ (1,647)
$
(444)
—
—
—
(444)
$ (0.20)
—
$ (0.05)
—
—
$ (0.20)
—
$ (0.05)
$ (0.20)
—
$ (0.05)
—
—
$ (0.20)
—
$ (0.05)
F-19
B o a r d o f D i r e c t o r s
SAMUEL C. JOHNSON, 73
GREGORY E. LAWTON, 51
THOMAS F. PYLE, JR., 60
JOHN M. FAHEY, JR., 49
Director since 1970.
Chairman Emeritus of
Director since 1997.
Vice Chairman of the Board.
Director since 2001.
President and Chief Executive Officer
Director since 1987.
President and Chief Executive
S.C. Johnson & Son, Inc.
of Johnson Wax Professional.
Chairman, The Pyle Group.
Officer and Chairman of the
Chairman, Johnson International.
Also Director of SCJ Commercial
Also Director of
Executive Committee of the
Also Director of
H. J. Heinz Company.
HELEN P. JOHNSON-LEIPOLD, 44
Markets, Inc., General Cable
Sub Zero Corporation.
Board of Trustees of the
Corporation and Superior Metal
Products, Inc..
GLENN N. RUPP, 57
Director since 1997.
National Geographic Society.
Also Director of Jason
Foundation for Education.
Chairman and Chief Executive Officer.
TERRY E. LONDON, 52
Former Chairman and Chief
Director since 1994.
Director since 1999.
Executive Officer of Converse Inc.
President of London Partners LLC
Shareholders' Information
CORPORATE HEADQUARTERS
Johnson Outdoors Inc.
1326 Willow Road
Sturtevant, Wisconsin 53177 USA
(262) 884-1500
INTERNET ADDRESSES (WWW.)
JohnsonOutdoors.com
carlislepaddles.com (Carlisle Paddles)
dimensionkayaks.com (Dimension)
escapesail.com (Escape Sailboats)
extrasport.com (Extrasport)
llboats.com (Leisure Life)
necky.com (Necky)
oceankayak.com (Ocean Kayak)
oldtowncanoe.com (Old Town)
minnkotamotors.com (Minn Kota Motors)
scubapro.com (Scubapro)
uwatec.com (Uwatec)
eurekatent.com (Eureka! tents)
wolfskin.de (Jack Wolfskin)
COMMON STOCK
Johnson Outdoors Inc. Class A Common Stock
is traded on The Nasdaq Stock Market® under
the symbol: JOUT.
ANNUAL MEETING
The Annual Meeting of Shareholders will con-
vene at 10:00 a.m. (CST) on February 19, 2002,
at the Company's Headquarters.
TRANSFER AGENT AND REGISTRAR
Firstar Bank Milwaukee, N.A.
Corporate Trust Department
P.O. Box 2077
Milwaukee, Wisconsin 53201
(414) 905-5000
SHAREHOLDER INQUIRIES
Communication concerning the transfer of
shares, lost certificates or changes of address
should be directed to the Transfer Agent.
Executive Officers
HELEN P. JOHNSON-LEIPOLD, 44
Chairman and Chief Executive Officer
PATRICK J. O'BRIEN, 43
President and Chief Operating Officer
PAUL A. LEHMANN, 48
Vice President and Chief Financial Officer
MAMDOUH ASHOUR, 63
Group Vice President and President –
Worldwide Diving
J o h n s o n O u t d o o r s I n c .
1 3 2 6 W i l l o w R o a d
S t u r t e v a n t , W i s c o n s i n
5 3 1 7 7 U S A
( 2 6 2 ) 8 8 4 - 1 5 0 0