Hello, everyone and welcome to the Johnson Outdoors Fourth Quarter 2019 Earnings Conference Call. Today's call will be led by Helen Johnson-Leipold, Johnson Outdoors' Chairman and Chief Executive Officer. Also, on the call is David Johnson, Vice President and Chief Financial Officer.Prior to the question-and-answer session, all participants will be placed in a listen-only mode. After the prepared remarks, the question-and-answer session will begin. [Operator Instructions] This call is being recorded. Your participation implies consents on recording this call. If you do not agree to these terms, simply drop off the line.I would now like to turn the call over to Patricia Penman from Johnson Outdoors. Please go ahead, Ms. Penman.

Thank you. Good morning, everyone. Thank you for joining us for our discussion of Johnson Outdoors' results for the 2019 fiscal fourth quarter and full-year. If you need a copy of today's news release, it is available on our website at johnsonoutdoors.com, under Investor Relations.I also need to remind you that this conference call may contain forward-looking statements. These statements are made on the basis of our current views and assumptions and are not guarantees of future performance. Actual events may differ materially from those statements due to a number of factors, many beyond Johnson Outdoors' control.These risks and uncertainties include those listed in our press release and filings with the Securities and Exchange Commission. If you have additional questions, following the call, please contact Dave Johnson or me.It is now my pleasure to turn the call over to Helen Johnson-Leipold.

Thanks, Pat. Good morning and thank you for joining us. I'll start off with comments on the quarter and full year results, discuss key performance drivers in each business, – excuse me, and outline priorities going forward. Dave will review the financial highlights, and then we'll take your questions.In fiscal 2019, revenue grew 3% to $562.4 million, profits were at $63.8 million, and net income was $51.4 million or $5.11 per diluted share, a 26.4% improvement from the prior fiscal year. Strong positive momentum continued into our fiscal fourth quarter, a period when the warm weather outdoor recreation industry is gearing down for the year. Total company net sales were $104 million, a 14% increase over prior year's fourth quarter and profits were up significantly as well.Overall, this year's performance reflects the value of our sustained focus and investment in translating deep rich consumer insights into the best outdoor recreation experiences possible, from beginning to end. This ensures, we are targeting the right consumer with the right product at the right time in the right way and at the right price. All are critical factors behind our continued success and sustained growth.Our Fishing business continued on its profitable growth trajectory, with the ongoing success of new and legacy technologies. Our successful track record pioneering innovation was made – has made Minn Kota and Humminbird the go to brands for the best possible fishing experiences on the water.Our deep consumer insights, coupled with the advancements in GPS and wireless technologies, enable us to constantly reimagine and redefine how to help anglers catch more fish. Humminbird had a great year, driven primarily by continued demand and excitement for our MEGA Imaging, particularly our HELIX fish finder series, our state-of-the- art MEGA sonar imaging gives anglers deep and clear underwater views. In addition,…

Thank you, Helen. Good morning everyone. I wanted to highlight a few things from the quarter and the year. As Helen mentioned, we came into our seasonally slow fourth quarter with a strong tailwind, driven by continued demand in our fishing and camping businesses. Operating profit in the fourth quarter, compared favorably to the prior year's quarter by $4 million, due largely to the sales growth.Additionally, we recovered $2.3 million of tariffs, as a result of exclusions granted in the fourth quarter of fiscal 2019. For fiscal 2019, sales grew moderately over the prior year and gross margins remained steady despite $2.9 million full year negative impact from tariffs. The exclusions and other mitigation efforts throughout the year help reduce the total impact of tariffs on fiscal 2019 profits from original estimates.In fiscal 2020, we expect the proposed increases in tariffs could negatively impact profits in the range of $5 million to $6 million. As was the case in fiscal 2019, we will pursue all possible mitigation efforts and hopes of reducing the impact of tariffs.Operating expenses were higher for the year, driven largely by higher sales volume related costs and increased bad debt expense. Additionally, investment in marketing increased over the prior year. Net income for the year benefited from a lower tax rate, reflecting the reduction in the U.S. federal corporate income tax rate.Fiscal 2019's full-year effective tax rate was 22.7%, compared to the prior fiscal year's rate of 40.3%. Next year, we expect the effective tax rate to be around the mid-20s. Looking ahead to next year, we expect continued moderate sales growth. Our balance sheet is strong and our healthy cash position enables us to continue to invest in growth opportunities.Now, I'll turn the call back over to the operator for the Q&A session. Operator?

Thank you. [Operator Instructions] Our first question comes from Anthony Lebiedzinski of Sidoti. Your line is now open.

Good morning and thank you for taking the questions. So, obviously a very solid performance here in the quarter. I know, you guys talked about, a little bit about tariffs as well. So, Dave, I guess that the reason that you expect the tariff impact to be more negative in fiscal 2020 versus fiscal 2019, is it because of the new tariffs or is it just the timing of the – of some issues, maybe if you could just clarify that for us?

Yes. It's both. It's the new tariffs that were rolled in a few months ago, affecting our costs, as well as we do have an exclusion that expires in March. So, we'll try to re-up for that, but right now, we're not counting on that.

Okay. Got it. Alright and then, in terms of fishing category. So, it was certainly very good in the quarter that you just reported. There are a couple of new competitors in the field. So, just wondering, what you guys – have you seen anything from your retail partners, as far as your ability to maintain your floor space? Have you been able to do that or just trying to get a better sense as to how you're looking to tackle this, as some of this is new competition?

It’s still early, but so far, our selling is going as planned. So, we'll know more at the end of our first quarter.

Got it, okay. And the balance sheet continues to be very strong, building up at cash. What are your thoughts as to deploying that cash?

Well, we've been looking at all options, doing a lot of looking obviously at opportunities to do acquisitions. We are actively out there. I would say that right now, we are feeling that the opportunities aren’t good, it's not good timing from the standpoint of the multiples, but again, we're looking at everything and considering all the options. It's great to have a strong balance sheet at this point.

Absolutely. And the last question from me, can you give us some updated thoughts as to how you’re doing with your direct-to-consumer business? I know you significantly improved your websites, a couple of years back. So, just wanted to get an update on that. Thank you.

It's doing well. Our direct-to-consumer, we consider it all e-commerce is, so our e-tailers are very important and D2C is just a piece of it. But having the new – and the revised website has really helped us from a marketing communication standpoint and it's driving both sales into our bricks and mortar, as well as through our e-commerce channel. So, we're feeling good about it. We still have a lot of work to do and it will be constantly evolving, but it's great that we've got all businesses actively participating in the omni-channel opportunity.

Got it. Okay. Thank you and best of luck.

Thank you.

Thanks, Anthony.

Thank you. And ladies and gentlemen, this does conclude our question-and-answer session. I would now like to turn the call back over to Helen Johnson-Leipold for any closing remarks.

Thank you all for joining us and have a great holiday season. Thank you.

Ladies and gentlemen, this concludes today's conference call. Thank you for participating. You may now disconnect.