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Sturm, Ruger & Company, Inc. Reports First Quarter Fully Diluted Earnings of $1.20 Per Share and Dividend of 49¢ Per Share



  Sturm, Ruger & Company, Inc. Reports First Quarter Fully Diluted Earnings of
  $1.20 Per Share and Dividend of 49¢ Per Share

Business Wire

SOUTHPORT, Conn. -- April 29, 2013

Sturm, Ruger & Company, Inc. (NYSE-RGR) announced today that for the first
quarter of 2013 the Company reported net sales of $155.9 million and fully
diluted earnings of $1.20 per share, compared with net sales of $112.3 million
and fully diluted earnings of 79¢ per share in the first quarter of 2012.

The Company also announced today that its Board of Directors declared a
dividend of 49¢ per share for the first quarter, for shareholders of record as
of May 10, 2013, payable on May 24, 2013. This dividend varies every quarter
because the Company pays a percent of earnings rather than a fixed amount per
share. This dividend is approximately 40% of net income.

Chief Executive Officer Michael O. Fifer made the following observations
related to the Company’s results:

  * Our earnings increased 53% from the first quarter of 2012, driven by the
    39% growth in sales and our ongoing focus on continuous improvement in our
    operations.
  * New product introductions were a significant component of our sales growth
    as new product sales represented $53.3 million or 35% of firearm sales in
    the first quarter of 2013. New product introductions in the first quarter
    of 2013 included the LC380 pistol and the SR45 pistol.
  * The estimated sell-through of our products from independent distributors
    to retailers in the first quarter of 2013 increased 12% from the first
    quarter of 2012. This estimated unit sell-through was effectively limited
    to first quarter production because distributor inventory totaled only
    59,200 units at December 31, 2012. For reference, at December 31, 2011,
    the distributor inventory totaled 135,600 units, allowing Q1 2012
    sell-through to exceed Q1 2012 production by 22%. During the first quarter
    of 2013, National Instant Criminal Background Check System (“NICS”)
    background checks (as adjusted by the National Shooting Sports Foundation)
    increased 46%.
  * Cash generated from operations during the first quarter of 2013 was $30.4
    million. At March 30, 2013, our cash and cash equivalents totaled $45.6
    million. Our current ratio is 1.6 to 1 and we have no debt.
  * In the first quarter of 2013, capital expenditures totaled $7.7 million,
    much of it related to new products and the expansion of production
    capacity. We expect to invest approximately $30 million for capital
    expenditures during 2013.
  * In the first quarter of 2013, the Company returned $7.8 million to its
    shareholders through the payment of dividends.
  * At March 30, 2013, stockholders’ equity was $111.6 million, which equates
    to a book value of $5.78 per share, of which $2.36 per share was cash and
    equivalents.

Today, the Company filed its Quarterly Report on Form 10-Q for the first
quarter of 2013. The financial statements included in this Quarterly Report on
Form 10-Q are attached to this press release.

Tomorrow, April 30, 2013, Sturm, Ruger will host a webcast at 12:00 p.m. EDT
of its Annual Meeting of Stockholders. Interested parties can access the
webcast at www.ruger.com/corporate  or www.earnings.com or by dialing
800-295-4740, participant code 60546881.

The Quarterly Report on Form 10-Q is available on the SEC website at
www.sec.gov and the Ruger website at www.ruger.com/corporate. Investors are
urged to read the complete Quarterly Report on Form 10-Q to ensure that they
have adequate information to make informed investment judgments.

About Sturm, Ruger

Sturm, Ruger was founded in 1949 and is one of the nation’s leading
manufacturers of high-quality firearms for the commercial sporting market.
Sturm, Ruger is headquartered in Southport, CT, with manufacturing facilities
located in Newport, NH and Prescott, AZ.

The Company may, from time to time, make forward-looking statements and
projections concerning future expectations. Such statements are based on
current expectations and are subject to certain qualifying risks and
uncertainties, such as market demand, sales levels of firearms, anticipated
castings sales and earnings, the need for external financing for operations or
capital expenditures, the results of pending litigation against the Company,
the impact of future firearms control and environmental legislation, and
accounting estimates, any one or more of which could cause actual results to
differ materially from those projected. Readers are cautioned not to place
undue reliance on these forward-looking statements, which speak only as of the
date made. The Company undertakes no obligation to publish revised
forward-looking statements to reflect events or circumstances after the date
such forward-looking statements are made or to reflect the occurrence of
subsequent unanticipated events.

STURM, RUGER & COMPANY, INC.                              
                                                            
CONDENSED BALANCE SHEETS
(Dollars in thousands)
                                                            
                                            March 30,      December 31,
                                            2013           2012
                                                            
Assets
                                                            
Current Assets
Cash                                        $ 45,611       $ 30,978
Trade receivables, net                        59,482         43,018
                                                            
Gross inventories                             54,275         55,827
Less LIFO reserve                             (38,221  )     (38,089  )
Less excess and obsolescence reserve          (1,964   )     (1,729   )
Net inventories                               14,090         16,009    
                                                            
Deferred income taxes                         7,521          5,284
Prepaid expenses and other current assets     1,101          1,632     
Total Current Assets                          127,805        96,921
                                                            
Property, plant and equipment                 203,256        195,713
Less allowances for depreciation              (133,821 )     (129,720 )
Net property, plant and equipment             69,435         65,993    
                                                            
Deferred income taxes                         2,451          2,004
Other assets                                  11,784         9,568     
Total Assets                                $ 211,475      $ 174,486   

STURM, RUGER & COMPANY, INC.                               
                                                             
CONDENSED BALANCE SHEETS (Continued)
(Dollars in thousands, except share data)
                                                             
                                              March 30,     December 31,
                                              2013          2012
                                                             
Liabilities and Stockholders’ Equity
                                                             
Current Liabilities
Trade accounts payable and accrued expenses   $ 41,461      $  38,500
Product liability                               991            720
Employee compensation and benefits              19,163         15,182
Workers’ compensation                           4,475          4,600
Income taxes payable                            14,622         489      
Total Current Liabilities                       80,712         59,491
                                                             
Accrued pension liability                       18,873         19,626
Product liability                               252            337
                                                             
Contingent liabilities                          --             --
                                                             
                                                             
Stockholders’ Equity
Common Stock, non-voting, par value $1:
Authorized shares 50,000; none issued           --             --
Common Stock, par value $1:
Authorized shares – 40,000,000
2013 – 23,618,934 issued,
19,319,500 outstanding
2012 – 23,562,422 issued,
19,262,988 outstanding                          23,619         23,563
Additional paid-in capital                      16,470         15,531
Retained earnings                               139,053        123,442
Less: Treasury stock – at cost
2013 and 2012 – 4,299,434 shares                (37,884 )      (37,884 )
Accumulated other comprehensive loss            (29,620 )      (29,620 )
Total Stockholders’ Equity                      111,638        95,032   
Total Liabilities and Stockholders’ Equity    $ 211,475     $  174,486  

STURM, RUGER & COMPANY, INC.
 
CONDENSED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME (UNAUDITED)
(In thousands, except per share data)
                                     
                                      Three Months Ended
                                      March 30, 2013   March 31, 2012
                                                      
                                                        
Net firearms sales                    $  153,440       $  110,787
Net castings sales                       2,465            1,550     
Total net sales                          155,905          112,337
                                                        
Cost of products sold                    94,596           70,544
                                                        
Gross profit                             61,309           41,793    
                                                        
Operating expenses:
Selling                                  15,764           10,999
General and administrative               8,443            6,378     
Total operating expenses                 24,207           17,377    
                                                        
Operating income                         37,102           24,416    
                                                        
Other income:
Interest expense, net                    (16      )       (23      )
Other income, net                        265              178       
Total other income, net                  249              155       
                                                        
Income before income taxes               37,351           24,571
                                                        
Income taxes                             13,633           9,091     
                                                        
Net income and comprehensive income   $  23,718        $  15,480    
                                                        
Basic earnings per share              $  1.23          $  0.81      
                                                        
Fully diluted earnings per share      $  1.20          $  0.79      
                                                        
Cash dividends per share              $  0.404         $  0.212     

STURM, RUGER & COMPANY, INC.
 
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Dollars in thousands)
                                                    
                                                     Three Months Ended
                                                     March 30,     March 31,
                                                     2013          2012
                                                                  
Operating Activities
Net income                                           $ 23,718      $ 15,480
Adjustments to reconcile net income to cash
provided by operating
activities:
Depreciation and amortization                          4,501         3,388
Slow moving inventory valuation adjustment             235           (53     )
Stock-based compensation                               1,330         928
Gain on sale of assets                                 (70     )     -
Deferred income taxes                                  (2,684  )     (1,365  )
Changes in operating assets and liabilities:
Trade receivables                                      (16,464 )     (6,801  )
Inventories                                            1,684         2,649
Trade accounts payable and accrued expenses            2,836         2,611
Employee compensation and benefits                     3,678         (4,238  )
Product liability                                      186           (65     )
Prepaid expenses, other assets and other               (2,676  )     5,119
liabilities
Income taxes payable                                   14,133        4,188    
Cash provided by operating activities                  30,407        21,841   
                                                                    
Investing Activities
Property, plant and equipment additions                (7,705  )     (3,047  )
Proceeds from sale of assets                           70            -
Purchases of short-term investments                    -             (19,994 )
Cash used for investing activities                     (7,635  )     (23,041 )
                                                                    
Financing Activities
Tax benefit from exercise of stock options             1,747         922
Remittance of taxes withheld from employees
related to                                             (2,082  )     (884    )
share-based compensation
Dividends paid                                         (7,804  )     (4,059  )
Cash used for financing activities                     (8,139  )     (4,021  )
                                                                    
Increase (decrease) in cash and cash equivalents       14,633        (5,221  )
                                                                    
Cash and cash equivalents at beginning of period       30,978        81,056
                                                                    
Cash and cash equivalents at end of period           $ 45,611      $ 75,835   

Contact:

Sturm, Ruger & Company, Inc.
One Lacey Place
Southport, CT 06890
www.ruger.com
203-259-7843
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