by Joseph P. Tartaro | Executive Editor
President Obama’s agenda for economic growth, more jobs and gun control has proven to be a winning formula, at least for the gun industry. In some quarters of the firearms industry, he has been considered the best salesman for the gun and ammunition industry, which began to see sales improve immediately after his election and go into afterburner since January.
For example, long established companies such as Remington Arms and Sturm, Ruger have announced new plants in gun friendly states, companies such as Armscor are branching into new fields, and new manufacturing companies are being born.
Gun owners and prospective gun owners shopping for arms and ammunition should be pleased with the prospect of better inventories and possibly even lower prices.
One example is Remington’s groundbreaking on their newest ammo plant in Lonoke, AR, at a time when gun fodder is scarce and prices are high.
The facility is expected to employ 50 to 100 people when it’s up and running, and should have the space and tooling to manufacture about 2 to 3 billion rounds a year.
If construction goes according to schedule, the facility will be up and running in less than a year, and will have 35,000 square-feet of floor space, costing Remington $32 million to complete.
“We continue to invest in all of our manufacturing operations because we are committed to ensuring quality, increasing product availability and improving on-time delivery,” said Kevin Miniard, Remington COO.
Remington already employs about 1,300 people at another facility in Lonoke and their presence is more than welcome. Remington was awarded state incentives totaling $465,250, according to the Arkansas Economic Development Commission, in addition to income and sales tax credits.
“There is no better place for Remington to be expanding, period,” said George Kollitides, Freedom Group CEO, at the ground-breaking ceremony, the Associated Press reported.
Arkansas Gov. Mike Beebe was also in attendance, as was US Sen. Mark Pryor (D), who has become a target for New York Mayor Michael Bloomberg, because the senator voted against the Manchin-Toomey background check measure that failed this Spring.
“We are extremely happy about this expansion,” Beebe said at the groundbreaking ceremony. “And extremely happy about all these jobs not only continue to stay in Arkansas, but continue to grow in Arkansas.” “Infrastructure is important,” added Beebe. “But … the single most important factor in a location in a business, and that’s the quality of the workforce.
And the quality of the workforce here has caused the expansion.” The expansion follows a state-level push to dismantle gun control laws when many states were instating new ones. Remington had many good reasons to select Arkansas, but the cool political climate surely helps.
Remington isn’t the only company adding new facilities. Earlier this year Armscor announced a $4 million expansion of their ammo plant in Pahrump, NV.
“At Armscor, we recognize the inconvenience and frustration gun owners have in finding ammunition and we are doing everything we can to push more product out the door and onto store shelves,” said Martin Tuason, CEO of Armscor and Rock Island Armory. “We are at something of an advantage in that our growth in US sales had us already looking at long term expansion so we are really accelerating our timelines.” Sturm, Ruger, which is currently in the process of opening its first new production facility in 20 years in North Carolina, announced that for the second quarter of 2013 the company reported net sales of $179.5 million and fully diluted earnings of $1.63 per share, compared with net sales of $119.6 million and fully diluted earnings of 91¢ per share in the second quarter of 2012.
For the six months ended June 29, 2013, net sales were $335.4 million and fully diluted earnings were $2.83 per share. For the corresponding period in 2012, net sales were $231.9 million and fully diluted earnings were $1.71 per share.
Ruger also announced that its board of directors declared a dividend of 65¢ per share for the second quarter, for shareholders of record as of August 16, 2013, payable on August 30, 2013. The company’s dividend varies every quarter because it pays a percentage of earnings rather than a fixed amount per share. This dividend is approximately 40% of net income.
Earlier, Ruger reported quick repairs of damage caused at its Prescott, AZ, plant during a severe thunderstorm on July 25. Heavy precipitation had caused a portion of the roof to collapse. No one was injured, but the facility was closed briefly and production was interrupted.
In less than a week, repairs were completed and approved and production resumed. The company said it expected the cost of the repairs to the building and equipment, plus the value of the lost production to be less than $5 million.
Earlier, Smith & Wesson Holding Corp. and ATK announced significant sales gains in the first quarter of the year, and Strategic Armory Corps announced on July 23 that it has acquired ArmaLite, Inc., manufacturer of semiautomatic rifles and an expanding line of advanced bolt-action rifles.
Strategic Armory Corps manufactures bolt-action Surgeon Rifles, AWC Silencer suppressors and match-grade ammunition. ArmaLite will continue to operate out of its facility in Geneseo, Ill.
At a press conference on July 26, Mississippi Gov. Phil Bryant announced that TALON Ordnance, a tactical firearms manufacturing facility, is coming to Mississippi.
TALON Ordnance’s premium, service-grade weapons will be manufactured in Ridgeland with 100% made-in-the-USA parts, which suggests more new jobs.
TALON is the first production-scale weapons manufacturing facility to originate in the state of Mississippi.
Military veteran Clay Baldwin is one of TALON’s founders and CEO. He has over 18 years of experience in law enforcement and military operations, and continues to serve in the Army Reserve. Baldwin is originally from Magee, MI, and has lived in the Madison area for many years.
“Weapons manufacturing is a highly researched, highly recruited industry and we are proud to be a homegrown effort that will remain based in Mississippi,” said Baldwin.
The company will initiate production this fall with a tactical rifle based on the AR-15 platform, with the first rifles off the line in January 2014.
Currently, the company looks to employ approximately 10 people and is expected to grow to about 50 employees in the near future.
