Newsnewsrcwrt

Wed Jun 12, 2019, 12:09 AM

U.S. Firearms Distributor Files Bankruptcy as Gun Sales Fall Under Trump

Jonathan Stempel

(Reuters) - United Sporting Cos, a large firearms distributor whose roots date to the Great Depression, filed for bankruptcy protection on Monday and said it plans to liquidate, hurt by falling sales after President Donald Trump was elected and as Dick’s Sporting Goods Inc began moving away from firearms.

The company, whose units including Ellett Brothers serve 20,000 retailers in all 50 states, said other reasons for its Chapter 11 filing were too much debt and discounting caused by excess inventory. It also cited “significant” disruptions in outdoor retailing such as Bass Pro Shops’ 2017 purchase of Cabela’s and Gander Mountain’s bankruptcy.

It said hurricanes in the southeast United States, which generates a large portion of the Chapin, South Carolina-based company’s sales, also reduced demand. USC carries such brands as Glock, Remington, Ruger and Smith & Wesson.

The firearms industry has faced pressure on sales after Trump's 2016 election eased gun control fears, even as a spate of U.S. mass shootings has prompted calls for more curbs on gun ownership (For a link to the report, click reut.rs/2MEnMDc).

In a court filing, Chief Executive Officer Bradley Johnson said USC boosted inventory before the 2016 White House race, expecting the higher sales that historically follow a Democrat’s election.

But he said the Republican Trump’s unexpected win over Democrat Hillary Clinton was a factor in net sales falling to $557 million in 2018 from an average $885.3 million from 2012 to 2016, with an accompanying glut of inventory.

more...

https://www.reuters.com/article/us-united-sporting-cos-bankruptcy/u-s-firearms-distributor-files-bankruptcy-as-gun-sales-fall-under-trump-idUSKCN1TB1YL

9 replies, 168 views

Reply to this thread

Back to top Alert abuse

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Arrow 9 replies Author Time Post
Reply U.S. Firearms Distributor Files Bankruptcy as Gun Sales Fall Under Trump (Original post)
RCW2014 Wednesday OP
foia Wednesday #1
batcat Wednesday #2
Currentsitguy Wednesday #3
imwithfred Wednesday #4
Gunslinger201 Wednesday #5
Steelydamned Wednesday #6
Hades Wednesday #7
oflguy Wednesday #8
Independent.mind Wednesday #9

Response to RCW2014 (Original post)

Wed Jun 12, 2019, 12:12 AM

1. You can still buy guns at Bass Pro Shops and Cabelas because they're not Dicks,

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 12:16 AM

2. The Democrats have always been better gun salesmen than the Republicans.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 01:06 AM

3. That's business. They gambled, they lost.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 01:33 AM

4. ".....Trumps unexpected win over Democrat Hillary Clinton was a factor in net sales falling....."

Well now, if the anti-gun nuts were sincere in their beliefs, they'd start voting Republican and for President Trump in the next election.

But of course they're not sincere.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 03:26 AM

5. I expect sales to pick up if they try Impeachment

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 09:22 AM

6. This article doesn't tell...

...the whole story. Looks like they bulked up their inventory in expectation of a Hillary win - like everyone else - only to have Trump win and the company being stuck with a bloated inventory and, no threat of new gun snatching laws.

But that’s not the whole story. Per Bloomberg, there are also allegations of mismanagement against Wellspring, the private equity company that owns the controlling stake in United:

"Some of the company’s lenders balked at Johnson’s explanation of United’s descent into bankruptcy. In an objection filed Monday afternoon, attorneys for Prospect Capital Corp. — one of United’s lenders — blamed mismanagement at the hands of its largest equity owner, Wellspring Capital Management.

A few years ago, United was the largest distributor of firearms in the U.S., according to the objection. But Wellspring “cashed out” more than $183 million through dividend recapitalization deals in 2012 and 2013, then appointed fiduciaries who “grossly mismanaged the business and depleted all reserves necessary to weather the storms and the headwinds the business would face,” the dissenting lenders said.

Prospect Capital and other term loan lenders have a lot to lose. The objection states that the second-lien lenders will likely recover “a small fraction” of their $250 million loan."

Remington also filed for bankruptcy in March and emerged two months later. Probably for the same reasons......everyone thought Hillary was going to win and thus, filled their warehouses with inventory in expectation of new gun laws being pushed.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 09:46 AM

7. Sales will go back up if the Dems win the presidency...

...keep the House and win the Senate. The shelves will be bare and the prices will double.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to RCW2014 (Original post)

Wed Jun 12, 2019, 10:15 AM

8. Another victim of global cooling

Reply to this post

Back to top Alert abuse Link here Permalink


Response to oflguy (Reply #8)

Wed Jun 12, 2019, 10:27 AM

9. LOL@roflguy

Reply to this post

Back to top Alert abuse Link here Permalink

Newsnewsrcwrt