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Nautilus has another big quarter with sales jump

31% year-over-year increase posted for Q2

By Brooks Johnson, Columbian Business Reporter
Published: August 1, 2016, 5:04pm

Vancouver-based Nautilus Inc. showed some muscle this spring as it posted a 31 percent year-over-year increase in sales and a second-quarter profit of $3.5 million, beating analysts’ expectations.

“The first half of 2016 has proven to be a great start to another positive year of growth,” Nautilus CEO Bruce Cazenave said during an investor call Monday. “By the end of 2016, we will have broadened our product portfolio, significantly expanded our channels of distribution and expanded our market share both domestically and internationally.”

For the quarter that ran April through June this year, the exercise equipment maker had net sales of $78.5 million, compared to $59.7 million in last year’s second quarter. That resulted in a $3.5 million profit, or 11 cents per diluted share.

Market analysts Zacks Investment Research had predicted earnings of 9 cents per share.

The bump in sales was partly due to the $115 million acquisition of Octane Fitness at the end of last year, adding to the Nautilus line of brands that includes Bowflex and Schwinn.

To try to get more Nautilus products into more homes — and not just through its well-known TV advertisements — the company announced a new initiative during Monday’s investor call.

“This fall, we will test a concept in which one Max Trainer model, the M3 at $999, will be available for in-store-only purchase with one national retail account,” Chief Operating Officer Bill McMahon said.

While much of the company’s business still relies on the direct-to-consumer model, whether online or by phone, the addition of Octane and other distribution strategies is meant to expand the company’s reach.

McMahon said that during Olympics and presidential elections, the company has to adjust its approach to buying airtime as the market for ads gets “choppy.”

Still, he said there is “overall good long-term health in the business in 2016.”

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Columbian Business Reporter