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Smith & Wesson Reverses Loss on Strength of Strong Sales

SPRINGFIELD, Mass. (AP) - Handgun maker Smith & Wesson, which cut 15 percent of its work force a year ago, reported $7.6 million in sales during the month following the terrorist attacks on the World Trade Center and the Pentagon.

The boost in domestic sales helped the company, which had been struggling with consumer backlash because of its deal with the Clinton administration to end federal lawsuits, post profits of $663,000 for the month.

The company lost about $2 million during October 2000, according to chief financial officer John Kelly.

"I believe these results are a very positive indicator of our progress and represents a decisive turnaround," Smith & Wesson president Bob Scott said Wednesday.

For years, Smith & Wesson, founded in 1852, was the nation's leading handgun maker. Its revolvers were used by sharpshooter Annie Oakley and the U.S. Cavalry, while its .38 caliber Police Special and .357 Magnum were the handgun carried by generations of police.

Sales, however, which had been steadily falling since 1995, dropped by half last year following an agreement with federal officials to restrict sales at gun shows and install trigger locks and other safety devices on its guns.

Last October, the company laid off about 125 employees, or 15 percent of its work force, at its Springfield headquarters. The layoffs and subsequent smaller cutbacks have left the company with about 550 workers here.

"We've seen a sizable increase in domestic sales since Sept. 11 with a lot of first-time buyers," Kelly said. "That spike may well level off, but more importantly some dealers that had stopped carrying our products have started carrying Smith & Wesson again. And we have picked up some new distributors."

"It's not the way we would have wanted to do it," Kelly said of the attacks.

He predicted that the handgun market could be heading back to the levels of the late 1980s and early 1990s, before the upheavals caused by tightened licensing and carry laws and municipal lawsuits.

"With our change in ownership, we've gained back some of what we had lost and should be well-positioned," he said.

Saf-T-Hammer, a small Arizona-based gun lock manufacturer, purchased the company in May from British conglomerate Tomkins PLC for $15 million in cash and repayment of a $30 million loan. Under the agreement, Saf-T-Hammer also assumed liability for about 30 gun death lawsuits filed by states and municipalities against Smith & Wesson.

Tomkins paid $112.5 million for Smith & Wesson in 1987.

The legal picture for Smith & Wesson and other gun companies also improved last month when the U.S. Supreme Court refused to review a ruling upholding a law passed by the Louisiana Legislature blocking the city of New Orleans suit against gun manufacturers.

Another 26 states have passed similar laws, at the urging of the National Rifle Association.

-- Anonymous, November 15, 2001

Answers

IIRC, right now, the only NEW gun you can buy, through a dealer, in Massachusetts is Smith & Wesson. Something to do with availability of trigger locks.

-- Anonymous, November 15, 2001