Nautilus, Inc. Starts 2020 with Encouraging First Quarter Results

May 05, 2020 04:05 PM Eastern Daylight Time

VANCOUVER, Wash.–(BUSINESS WIRE)–Nautilus, Inc. (NYSE: NLS) today reported its unaudited operating results for the first quarter of 2020.

Management Comments

“In the first quarter of 2020, we achieved stronger than expected financial results, including revenue growth of 11%, our first positive sales comp since third quarter of 2018, and significantly exceeded our EBITDA estimates,” said Jim Barr, Nautilus Inc. Chief Executive Officer. “The continued momentum of our new connected fitness products and technology, as well as the strategic and operational changes instituted in the latter half of 2019 put us on track to deliver year-over-year improvement. However, when COVID-19 pandemic stay-at-home orders hit the last few weeks of the quarter, it was the agility and strong execution of the team that allowed us to maximize the opportunity provided by the surge in demand for at-home fitness products. It was rewarding to see the power of our brands, strength of our product portfolio, and reach of our omnichannel model in action when our customers needed us most. We delivered strong results across many of our brands including our Bowflex® and Schwinn® lines, in both strength and cardio products.”

“As we enter the second quarter and prepare for the remainder of 2020, we know we will be navigating a rapidly changing environment. We experienced the ripple effects of the supply chain disruption caused by COVID-19 early in the first quarter and then experienced a strong spike in demand across the product portfolio as the virus hit world-wide. Although we’ve expanded production in response to continued strong demand, we carry over a significant level of back-orders into the second quarter and believe we may not be fully caught up until the beginning of the third quarter. Additionally, while the consumer side of our business is surging, the commercial side, represented by our Octane Fitness brand, is experiencing softness, as gym closures have resulted in sales declines. Lastly, like many companies, we are closely monitoring the longer-term impact the shelter-in-place orders are having on consumer sentiment and demand.”

Mr. Barr continued, “I want to thank our dedicated employees and partners for how they’ve responded to the demands of the COVID-19 pandemic, rapidly changing our work model to remote work, dealing with disruptions in their lives, but still remaining focused on solutions to meet our customers’ needs. While delivering for customers in the short-term, our team is also balancing focus on longer-term challenges. It is important to remember that we are early in the long-term transformation of our company. We are actively gaining insights and continue to address the underlying issues that caused our multi-year revenue decline. While we believe we are making strong quarter-to-quarter progress, it is possible we will not yet produce consistent linear quarterly improvements, especially considering the array of uncertain outcomes from the longer-term impact of COVID-19. However, we believe that the company’s resolve, resilience, and agility are qualities that, when coupled with well-known brands and a strong product portfolio, will allow us to successfully implement the strategies that will return Nautilus to long-term profitable growth.”

First Quarter 2020 Segment Results Compared to First Quarter 2019

Direct Segment

Retail Segment

Tax Rate

Balance Sheet

As of March 31, 2020:

Conference Call

Nautilus will discuss first quarter 2020 operating results during a live conference call and webcast on Tuesday, May 5, 2020 at 1:30 p.m. Pacific Time. The conference call can be accessed by calling (877) 425-9470 in North America. International callers may dial (201) 389-0878. Please note that there will be presentation slides accompanying the earnings call. The slides will be displayed live on the webcast and will be available to download via the webcast player or at The webcast will be archived online within two hours after completion of the call and will be available for six months. Participants from the Company will include Jim Barr, Chief Executive Officer, Aina Konold, Chief Financial Officer and Bill McMahon, Special Assistant to the CEO.

A telephonic playback will be available from 4:30 p.m. PT, May 5, 2020 through 8:59 p.m. PT, May 19, 2020. Participants can dial (844) 512-2921 in North America and international participants can dial (412) 317-6671 to hear the playback. The passcode for the playback is 13701186.

Non-GAAP Presentation

In addition to disclosing its financial results determined in accordance with GAAP, Nautilus has presented in this release certain non-GAAP financial measures, which exclude the impact of certain items (as further described below) and provide supplemental information regarding operating performance. Nautilus presents non-GAAP financial measures as a complement to results provided in accordance with GAAP, and the non-GAAP financial measures should not be regarded as a substitute for GAAP. By disclosing these non-GAAP financial measures, management intends to provide investors with a supplemental comparison of operating results and trends for the periods presented. Management believes these measures are also useful to investors as such measures allow investors to evaluate performance using the same metrics that management uses to evaluate past performance and prospects for future performance. Nautilus strongly encourages you to review all its financial statements and publicly filed reports in their entirety and to not rely on any single financial measure.

For a quantitative reconciliation of our non-GAAP financial measures to the most comparable GAAP measures, see “Reconciliation of Non-GAAP Financial Measures” included with this release.

EBITDA from Continuing Operations

Nautilus defines EBITDA from continuing operations as its income from continuing operations, adjusted to exclude interest expense (income), income tax expense (benefit) of continuing operations, and depreciation and amortization expense. Nautilus uses EBITDA from continuing operations in evaluating its operating results and for financial and operational decision-making purposes such as budgeting and establishing operational goals. Nautilus believes that EBITDA from continuing operations helps identify underlying trends in its business that could otherwise be masked by the effect of the items that are excluded from EBITDA from continuing operations and enhances the overall understanding of the Company’s past performance and future prospects. Management believes that EBITDA is frequently used by investors, securities analysts and other interested parties in their evaluation of companies, many of which present EBITDA when reporting their results. Other companies may calculate EBITDA differently, and it may not be comparable.

About Nautilus, Inc.

Headquartered in Vancouver, Washington, Nautilus, Inc. (NYSE: NLS) is a global technology driven fitness solutions company that believes everyone deserves a fit and healthy life. With a brand portfolio including Bowflex ®, Nautilus®, Octane Fitness® and Schwinn ®, Nautilus, Inc. develops innovative products to support healthy living through direct and retail channels as well as in commercial channels. Nautilus, Inc. uses the investor relations page of its website ( to make information available to its investors and the market.

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