2nd Largest Gunmaker Nears Default As Americans Buy Fewer Firearms Post-Obama

Tyler Durden's picture

2017 has seen the biggest drop in American firearms sales in history.

After 8 years of almost incessant rises in NICS Firearms Checks (a proxy for 'legal' arms sales) under President Obama...

source: NICS

2017 has seen a considerable drop (year-to-date) - the biggest on NICS records...

source: NICS

This sudden drop in demand after President Trump's election has meant Remington Outdoor, the second-largest U.S. gunmaker, has suffered a “rapid” and “sharp” deterioration in sales and a similar drop in profits since January, and faces “continued softness in consumer demand for firearms,” according to credit analysts at Standard & Poor’s Global Ratings.

As Philly.com's Joseph DiStefano reports, S&P cut the company’s corporate credit rating - already at a junk-bond-level CCC+ - two full notches, to CCC- as:

...a backlog of unsold, unwanted firearms will force Remington to operate at a loss and “pressure the company’s sales and profitability at least through early 2018, resulting in insufficient cash flow for debt service and fixed charges,” unless Remington gives up cash to pay for ongoing operations.

 

S&P expects “a heightened risk of a restructuring” of Remington’s $575 million senior secured loan and asset-based lending facility, which it is supposed to pay back in 2019.

 

If Remington defaults on its payments, based on the company’s current value, S&P expects first-lien creditors may receive around 35 cents back from every dollar they have lent or invested. Lower-rated creditors would get back less, or nothing.

While the report said that default is not yet "a virtual certainty," judging by the collapse in Remington's bond prices this week... the market is pretty sure.

And while Remington is not public, it is not alone in pain as shown below...

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Lost in translation's picture

Saturated market + declining wages + political complacency = insolvency.

hedgeless_horseman's picture

 

The ol' 11-87 trap was a helluva gun.  Then I discovered Italian guns.

Cognitive Dissonance's picture

Remington Outdoor was/is hardly the only company leveraged to the hilt and riding a wave that will eventually collapse.

Can you say the entire S&P 500?

Restorative_Ally's picture

Couldn't be their terrible QC and guns that shoot themselves.

Overfed's picture

R51 ring any bells? And even when they get the bugs sorted out, they don't make attractive guns. The R51 and RP9 with the huge logos on the grips are fugly. The 700 doesn't do anything a Savage won't do for a lot less $. Oh, and they can't seem to get the heat treat right on the shell latches on their pump and semi-auto shotguns. Furthermore, ever since the part of FEMA region X that I live in has adopted firearm registration (universal background checks), I only buy guns face to face with cash.

MonetaryApostate's picture

2008 crash, massive fraud, Hyper QE, corruption, & scandals, what's next?

Hyper inflation for certain, but...

Historically a country creates massive bonds before war...

WAR, HUH! WHAT IS IT GOOD FOR?

Obviously for turning lead into gold, oil, & drugs.

Did I mention millions of poor serfs dying?

 

This is a move to end guns, police will round up the rest through crime, gangs, & police state tactics they learned in special training.

 

Wake up already, they stole everything!

 

#EveryoneVsTheMoneyPrinters

https://plus.google.com/+GaleInnes/posts/CdLuBK4GcMy

 

TrajanOptimus's picture

Remington 700's are ABSOLUTE GARBAGE compared to older versions.

You make a shit product, no one will buy your shit product.

The private equity firm that owns Remington ran it in the dirt and raped it into junk status.

Surprised? I'm not. When the end game is to milk it for all it's worth, you end up with a shell of a former great company.. It is what "they" do.

I went custom, starting with a Stiller action and a Bartlein barrel.. Will never look back.

The_Juggernaut's picture

Shitty companies going under is the healthiest thing in the world. 

 

Ruger has zero debt and treats their shareholders well, btw.

HowdyDoody's picture

Some NRA dingbat once said that Obama was the best salesman the US weapons industry ever had. It seems like he may have been right.

swmnguy's picture

I'm sure the NRA was right about that.  And then Obama went and seized everybody's guns, just as he never said he would do.  

Oh, wait.

Then the specter of Hillary sold a bunch of guns.  But the election of Trump let everyone calm down enough they realized they don't actually need a gun, or at least didn't need more guns than they can personally use at any given time.

People are such chumps.  There's no way to twist around the facts until they make any sense.  As if one faction of the Oligarchs as opposed to another would make much difference.  As if a few amateurs with pistols were going to hold off a squad of actual soldiers.  As if 99.95% of Americans have ever, and will ever, be in a situation that would go better with the use of a gun.

I suppose it's better than term life insurance.  At least at the end of buying a gun for no good reason you at least have a gun.  That's what the guy on my block said, who had 3 children under 5 years old and at least 8 guns in his house, until his house was burglarized and all they took were the guns, which he apparently didn't have properly secured.  He would have been far better off spending the money on basement windows that couldn't be so easily jimmied open.  But people are terrible judges of risk, which is why they have swimming pools installed and buy guns to protect their children.

jughead's picture

No shit...remember how everybody got all complacent under Bush the Dumberer.  He didn't take your guns but he turned the country into a fucking warmongering police state - which his fucking replacements have enjoyed expanding.  

jeff montanye's picture

wished those too big to jail banks had gone under as well (with fdic administration to protect insured depositors and provide continuity for the banking franchise).

clean out the share and bondholders, management too though.

Barney Fife's picture

I bought a 700 CDL in 2001, almost sold it two years later when it slam fired out in the field. I actually loved that gun except for that shitty trigger. So I put a two stage Kleppinger trigger in it.  Now I'll never sell it. 

But yeah, they have gone downhill, and the infamous slam fire trigger was the start. Once I fixed that though mine older model turned into a gem. 

Richard Chesler's picture

Where is theBlack Friday Sale?

I'd buy a nice 1911...

Creative_Destruct's picture

I suppose extrapolating sales from the last Obama year and assuming Hitlery would win caused them to WAAAAYYY over stockpile inventory.

TheRideNeverEnds's picture

Remington hasn’t made anything decent since the turn of the century.

It’s knicknamed remshit for a reason. The company has been kept alive by gun noobs and nostalgic fudds.

blargg's picture

Remington had and have some rebates on ammo this month.

Obadiah's picture

Looking for a great place to get guns and ammo at great prices?  Way better than dirtcheap, Cabelas and all the others, try this guy DEGUNS.com

newdoobie's picture

Rock Island is the way to go.

Grimaldus's picture

Yup.

Best pistol I own. Box stock Rock Island Govt 1911 model .45acp. Stone reliable, awesome trigger, so easy to point and shoot accurately. Will go toe to toe with much moar expensive 1911's.

 

 

 

 

 

Grimaldus

Spaznets's picture

The RP9 is a rubbish handgun. Trigger pulls like a rotten banana. And we discovered this lovely feature while testing it:

https://youtu.be/NBsVuiyuohU

ShrNfr's picture

I got a bang out of that comment.

Cistercian's picture

Remington sucks now. I bought from Colt, S&W, Daniels defense, Sig and Beretta.

Like lots of other buyers, I got zero from Remington.

Sad, actually. The 700 used to be a heck of a nice rifle...now not so much.

tmosley's picture

That's what I was thinking, but I haven't found much in the way of good deals, at least at Cabela's.

I do need a good semi-auto centerfire rifle.

hedgeless_horseman's picture

 

Take some of your BTC profits and get a Tavor X95, swap out the cutlass grip for pistol, add an ACOG, Dueck Defense tritium RTS, ambi micro safety lever, Magpul angled foregrip, Streamlight TLR-1, Urban ERT sling, and be happy.

You said good, not cheap.

Overfed's picture

I'd take a quality AR over a Tavor any day. Bullpups are a great idea in theory, but in practice they kinda suck.

Tallest Skil's picture

I'm still really in love with the concept of the bullpup, but I've not found one that I could really want to call my own. Take the FN P90. Wacky looking thing, but it grows on you. I love the magazine capacity. But the reloading isn't easy (read: quick, for live fire scenarios) and the caliber isn't common. I'm still holding out for a bullpup rifle to fill that bullpup-less hole in my heart.

zjxn06's picture

Daniel Defense M4 V1 - End of Story

hedgeless_horseman's picture

 

Nope.  The new trigger on the X-95 is just fine.  

There is a reason the I.D.F. switched from M-16s and M-4s to the Tavor.  Piston driven like an AK, with rod welded to the bolt carrier.  16" barrel means no S.B.R. paperwork.  I have had very good experiences.  Ultimately reliable and more than accurate enough for a fighting weapon.

TrajanOptimus's picture

Just get a piston driven AR, problem solved without all the bulk and LACK of after-market products.

Plus, they aint American and I am not buying Joo shit.

ImGumbydmmt's picture

I have to go with HH on this one.

Lets all first concede that the AR-15 is the MOST developed/evolved platform in weapons history. (sorry AK guys, but none of you are winning 3-gun matches)

However the best of the best among AR platform units are often $2k-$3 piston driven to make up for the Direct impingement drawbacks. LWRC, Daniel Defense, POF.....

Next, the biggest market segment for AR-15/M-4 is in the SBR/ Wrist brace pistol/(um sort of SBR loophole) realm. FOr good reason, they are VERY handy at the smaller size.

The 10.5" SBR is short enough to do most everything CBQ to 150 yards,  EXCEPT loss of muzzle velocity in a 10 barel kills effectivness of 5.56mm ammunition. so .300 blackout is anattempt to make up for this loss but still you are not going much past 250 yards with .300 BO anyway.

The X-95 is a Battle driven evolution of the Tavor and has the SBR compact size but runs a full 18" long rifle barrel.

At a local 3-gun match I watched a guy with the first Tavor clang off a string of 600 yard 6" diameter circle plate rack like it was easy peasy. I asked him about the weapon and what he did with it. Vortex Stikefire Eagle 1-6x scope (now in 1-8x) and a geiselle trigger and nothing else.

WOW. effing A wow.

No AR/SBR with a 10" barrel can transition from CQB to 600 meters.

the Israelis (hate them if you must) have battle proven this platform. 

i do not have one yet, BUT only becasue i am the only lefty in my family and its an expensive rig to not be able to hand to anyone else.

If you're a righty or don't ever think you need to share it, the X-95 does the job of at least two sizes of AR-15, both an SBR and an 20" M-16.

Also look into the SOCOM developed MK262 77grain and the newer XM855A1 tungsten core ammo both in 5.56.

The heavy grain 5.56 is a good crutch for the SBR AR. look into what happens to an SBR's muzzle velocity here.

http://www.ballisticsbytheinch.com/223rifle.html

recommended

https://www.hornady.com/ammunition/rifle/5.56-nato-75-gr-interlock-hd-sb...!/

 

 

Overfed's picture

There ain't a damn thing wrong with DI.

syzygysus's picture

If you like your rifle to shit where it eats, I guess there ain’t a damn thing wrong at all.

Dilluminati's picture

good post, I reload so I'm at that point of if I resize and trim going to 308 win, what's you thought on creedmoor?   I haven't actually shot one, but I'm sort of wondering if I want to go with that versus the 308 WIN (7.62 NATO)  if you have exp with the creedmoor what was your thoughts?

zjxn06's picture

I've shot .308 (7.62) and 6.5 Creedmoor.  6.5 Creedmoor superior performance beyond 700 yds.  Flatter shooting. Less susceptible to wind.

RumpleShitzkin's picture

Keltec bull pup in 7.62.

You guys sure love giving kikes money every chance you get. Bending over backwards to make it fit.

Whatever.

TheReplacement's picture

Having had damaged fingers in the past, a gun you cannot use ambidextrously is a nonstarter.  An AR or AK might not be comfy weakhand but they work fine that way, even the pistol variants.  Useability is a big thing for me.  Reliability is as well and thus why I favor AKs to ARs.  A nice light gun that is really accurate is good but a gun that goes bang everytime, no matter what, is great.

Besides, didn't the LV shooter learn us to ask 'why bring one gun to a fight when you can lug around a couple of dozen?'

Oldwood's picture

Try the K&M 308 bullpup. Have one suppressed and love it...great trigger.

http://www.kmarms.com/M17S308.html

tmosley's picture

That's a hell of a fancy-pants bull pup.

ImGumbydmmt's picture

HH,

I'm still recommending /promoting your high speed ultra lightweight bugout kit with the FNPS-90 in 5.7 from about 2 or 3 years ago

I downloaded it, but you should re-post that link for everyone. it was an awesome write up.

Part of your assertion in favor of the PS-90 was the voume of ammo per pound that can be carried compared to 9mm or 5.56mm

Have you changed your opinion about the PS-90s now that the X-95 has come to town?

Do you have any thoughts on the Kel-tec 22 mag little CMR-30 carbine as the low budget PS-90 substitute?

https://www.keltecweapons.com/rifles/cmr-30