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Segments
 6 Months Ended
Jun. 28, 2024
Segment Reporting [Abstract]  
Segments Segment Information
Due in part to how we operate our business and to best serve our customers, we manage our activities based on three operating segments: Powered Vehicles Group, Aftermarket Applications Group, and Specialty Sports Group. All of our segments design, engineer and manufacture performance-defining products and systems for customers worldwide.
The following is a description of our operating segments.
Powered Vehicles Group: This segment operates 2 plants in the United States. Our premium products sold under the FOX brand for off-road vehicles and trucks, side-by-sides, on-road vehicles with and without off-road capabilities, ATVs, snowmobiles, specialty vehicles and applications, motorcycles, and commercial trucks. These products are sold through both OEM and aftermarket channels.
Aftermarket Applications Group: This segment operates 15 plants across the United States. Our range of aftermarket applications products includes premium products under the BDS Suspension, Zone Offroad, JKS Manufacturing, RT Pro UTV, 4x4 Posi-Lok, Ridetech, Tuscany, Outside Van, SCA, and Custom Wheel House brands designed for off-road vehicles and trucks, side-by-sides, on-road vehicles with or without off-road capabilities, specialty vehicles and applications, and commercial trucks.
Specialty Sports Group: This segment operates 9 plants and 13 distribution facilities (11 in the United States, 4 in Taiwan, and one facility each in Australia, Canada, Germany, Japan, Sweden, Switzerland, and United Kingdom). Our bike product offerings are used on a wide range of performance mountain bikes, e-bikes and gravel bikes under the FOX, Race Face, Easton Cycling and Marzocchi brands. These products are sold through both OEM and aftermarket channels. Our products for diamond sports include premium baseball and softball equipment under the Marucci, Victus, Lizard Skins, and Baum Bat brands and are sold through dealers and distributors and through direct-to-customer channels.
Net sales and expenses are measured in accordance with the policies and procedures described in Note 1 – Business and Summary of Significant Accounting Policies within our 2023 Form 10-K.
We measure the profitability and financial performance of our operating segments based on adjusted EBITDA. Adjusted EBITDA provides a measure of our underlying segment results that is in line with our approach to risk management. We define adjusted EBITDA as net income adjusted for (a) interest expense, (b) income tax or tax benefits, (c) amortization including amortization of purchased intangibles, (d) depreciation, (e) stock-based compensation, (f) litigation and settlement related expenses, (g) organizational restructuring expenses, (h) acquisition and integration-related expenses, and (i) strategic transformation costs. Adjusted EBITDA Margin is defined as adjusted EBITDA divided by net sales.
Segment asset information is not presented because it is not evaluated by the CODM at the segment level.
The tables that follow show selected segment financial information including information for prior comparative period. Unallocated corporate expenses are corporate overhead expenses that are not directly attributable to one of our business segments and include unallocated occupancy costs for our corporate headquarters, acquisition costs, other benefit and compensation programs, including performance-based compensation, and administrative expenses such as accounting, finance, legal, human resources, and information technology expenses.
For the three months endedFor the six months ended
June 28, 2024June 30, 2023June 28, 2024June 30, 2023
Net sales
Power Vehicles Group$117,795 $140,196 $235,908 $282,443 
Aftermarket Applications Group107,129 155,635 208,981 294,352 
Specialty Sports Group123,567 104,884 237,074 223,771 
Net sales$348,491 $400,715 $681,963 $800,566 
Net income5,407 39,735 1,911 81,502 
(Benefit) provision for income taxes(371)8,095 (1,638)17,473 
Depreciation and amortization 20,403 15,397 40,854 28,712 
Non-cash stock-based compensation2,203 4,483 6,109 10,184 
Litigation and settlement-related expenses1,231 659 2,760 1,637 
Other acquisition and integration-related expenses (1)470 6,125 5,633 10,599 
Organizational restructuring expenses413 — 476 — 
Strategic transformation costs822 — 1,254 — 
Interest and other expense, net13,554 4,954 27,192 8,499 
Adjusted EBITDA$44,132 $79,448 $84,551 $158,606 
Power Vehicles Group15,889 23,882 31,770 41,540 
Aftermarket Applications Group14,156 37,830 29,026 74,109 
Specialty Sports Group29,214 34,109 53,271 75,939 
Unallocated corporate expenses(15,127)(16,373)(29,516)(32,982)
Adjusted EBITDA$44,132 $79,448 $84,551 $158,606 
(1) Represents various acquisition-related costs and expenses incurred to integrate acquired entities into the Company’s operations and the impact of the finished goods inventory valuation adjustment recorded in connection with the purchase of acquired assets, per period as follows:
For the three months endedFor the six months ended
June 28, 2024June 30, 2023June 28, 2024June 30, 2023
Acquisition related costs and expenses$470 $300 $1,148 $1,704 
Purchase accounting inventory fair value adjustment amortization— 5,825 4,485 8,895 
Other acquisition and integration-related expenses$470 $6,125 $5,633 $10,599