Ammunition is seen for sale on the shelf at the National Armory gun store in Pompano Beach, Florida. (Photo: Joe Raedle/Getty Images)
Top executives at Olin said raising prices on Winchester Ammunition only drew “limited success” for the company’s bottom line.
Chief Executive Officer John Fischer told investors Wednesday higher material costs drove up prices in the company’s second quarter. Although 2018 numbers reflect better demand over last year, he said, commercial ammo sales still declined 8 percent.
“Throughout the first half of 2018, our efforts to recover higher commodity metal prices through higher selling prices have met with limited success,” he said.
Olin — a prominent chemical manufacturer — reported a 2 percent decline in the ammunition line’s overall sales, totaling $165.9 million through June 30. In 2017, Olin watched Winchester sales plummet 15 percent — a lingering side effect of the presidential election.
Still, Fischer said, increased demand from military customers and a recovering market creates a positive outlook for Winchester moving forward — so long as the company reigns in operating costs.
“We do think if you look back historically, commercial volumes tend to decline somewhere around six consecutive quarters off of a peak. The second quarter of this year would have been the sixth quarter,” he said. “So, we have expectations that commercial volumes will stabilize here.”
Sales in Olin’s other categories — including chlorine and caustic soda, vinyls, epoxies, chlorinated organics, bleach and hydrochloric acid — topped $1.7 billion, a 13 percent increase over 2017.
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