# EDGAR Filing Document

**Accession Number:** 0000095029
**File Stem:** 0001174947-23-000241
**Filing Date:** 2023-2
**Character Count:** 24863
**Document Hash:** f0a9eacf5559b95ace1e994aeb338ff0
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001174947-23-000241.hdr.sgml**: 20230222

**ACCESSION NUMBER**: 0001174947-23-000241

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 15

**CONFORMED PERIOD OF REPORT**: 20230222

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230222

**DATE AS OF CHANGE**: 20230222

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** STURM RUGER & CO INC
- **CENTRAL INDEX KEY:** 0000095029
- **STANDARD INDUSTRIAL CLASSIFICATION:** ORDNANCE & ACCESSORIES, (NO VEHICLES/GUIDED MISSILES) [3480]
- **IRS NUMBER:** 060633559
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-10435
- **FILM NUMBER:** 23654464

**BUSINESS ADDRESS:**
- **STREET 1:** 1 LACEY PLACE
- **CITY:** SOUTHPORT
- **STATE:** CT
- **ZIP:** 06490
- **BUSINESS PHONE:** 2032597843

**MAIL ADDRESS:**
- **STREET 2:** 1 LACEY PLACE
- **CITY:** SOUTHPORT
- **STATE:** CT
- **ZIP:** 06490

?xml version="1.0" encoding="utf-8"?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the**

**Securities Exchange Act of 1934**

**Date of Report (Date of earliest event reported)**

**February 22, 2023**

**STURM, RUGER & COMPANY, INC.**

(Exact Name of Registrant as Specified in its Charter)

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| | | |
|:---|:---|:---|
|  **Delaware**<br> (State or Other Jurisdiction of Incorporation) | **001-10435**<br> (Commission File Number) | **06-0633559**<br> (IRS Employer Identification Number) |

---

---

| | |
|:---|:---|
| **One Lacey Place, Southport, Connecticut** | **06890** |
| (Address of Principal Executive Offices) | (Zip Code) |

---

**(203) 259-7843**

Registrant's telephone number, including area code

**N/A**

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (*see* General Instruction A.2. below):

◻ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

◻ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

◻ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

◻ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| &nbsp;&nbsp;Title of each class | &nbsp;&nbsp;Trading Symbol(s) | &nbsp;&nbsp;Name of each exchange on which registered |
| &nbsp;&nbsp;Common Stock | &nbsp;&nbsp;RGR | &nbsp;&nbsp;NYSE |

---

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

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| | |
|:---|:---|
| **Item 2.02** | **Results of Operations and Financial Condition** |

---

On February 22, 2023, the Company issued a press release to stockholders and other interested parties regarding financial results for the year ended December 31, 2022. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

The information in this Current Report on Form 8-K and the Exhibit attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

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| | |
|:---|:---|
| **Item 9.01** | **Financial Statements and Exhibits** |

---

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| | |
|:---|:---|
| <u>Exhibit No</u>. | Description |
| 99.1 | [Press release of Sturm, Ruger & Company, Inc., dated February 22, 2023, reporting the financial results for the year ended December 31, 2022.](ex99-1.htm) |

---

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, hereunto duly authorized.

---

| | | |
|:---|:---|:---|
| STURM, RUGER & COMPANY, INC. | STURM, RUGER & COMPANY, INC. | STURM, RUGER & COMPANY, INC. |
| By: | /S/ Thomas A. Dineen | /S/ Thomas A. Dineen |
|  | Name: | Thomas A. Dineen |
|  | Title: | Principal Financial Officer, |
|  |  | Principal Accounting Officer, |
|  |  | Senior Vice President, Treasurer and |
|  |  | Chief Financial Officer |

---

Dated: February 22, 2023

## Exhibit 99.1

EXHIBIT 99.1

![Ruger-logo_final_lg.jpg](image_001.jpg)

![Corp_Fifer_Ltrhd_2012.jpg](image_002.jpg)

FOR IMMEDIATE RELEASE

STURM, RUGER & COMPANY, INC. REPORTS 2022

DILUTED EARNINGS OF $4.96 PER SHARE AND

DECLARES DIVIDEND OF 42¢ PER SHARE

SOUTHPORT, CONNECTICUT, February 22, 2023--Sturm, Ruger & Company, Inc. (NYSE-RGR) announced today that for 2022 the Company reported net sales of $595.8 million and diluted earnings of $4.96 per share, compared with net sales of $730.7 million and diluted earnings of $8.78 per share in 2021.

For the fourth quarter of 2022, net sales were $149.2 million and diluted earnings were $1.06 per share. For the corresponding period in 2021, net sales were $168.0 million and diluted earnings were $2.14 per share.

The Company also announced today that its Board of Directors declared a dividend of 42¢ per share for the fourth quarter for stockholders of record as of March 10, 2023, payable on March 24, 2023. This dividend varies every quarter because the Company pays a percentage of earnings rather than a fixed amount per share. This dividend is approximately 40% of net income.

Chief Executive Officer Christopher J. Killoy commented on the financial results for the year, "Consumer demand in 2022 was below the level of demand in 2021, dampened in part by inflationary pressures, which often constrain discretionary spending. This led to a 18% reduction in our sales from the prior year. Nevertheless, we are encouraged by our increased quarterly sales and production in the fourth quarter. Our disciplined approach and long-term focus yielded strong cash flow, investment in our new product development, and a robust, debt-free balance sheet."

Mr. Killoy reiterated the Company's commitment to new product development, "We continue to enhance our catalog of products with exciting and innovative new firearms that were met with strong demand in the marketplace. Our major new product launches in 2022 included:

&nbsp;&nbsp;&nbsp;&nbsp;· Marlin Model 1895 Guide Gun, chambered in 45-70 Govt, which was
our first reintroduction in the Marlin Guide Gun family of lever-action rifles,

&nbsp;&nbsp;&nbsp;&nbsp;· Marlin Model 1895 Trapper stainless steel lever-action rifle, chambered in .45-70 Govt.,

&nbsp;&nbsp;&nbsp;&nbsp;· LC Carbine, chambered in 5.7x28mm, a companion to the Ruger-5.7 pistol,

&nbsp;&nbsp;&nbsp;&nbsp;· Security-380 Lite Rack Pistol, a full-featured pistol chambered in light-recoiling .380 Auto, and

&nbsp;&nbsp;&nbsp;&nbsp;· Small-Frame Autoloading Rifle, or SFAR, chambered in 7.62 NATO /
..308 Win., which combines the ballistic advantages of .308 Win. with the size and weight of a traditional modern sporting rifle.

Mr. Killoy concluded by reaffirming the Company's capital philosophy, "Our focus on financial discipline and the cultivation of long-term shareholder value is unwavering. We continue to evaluate opportunities, but will pursue them only if they provide long-term value to our shareholders. When we believe our cash position significantly exceeds our foreseeable funding requirements for operations, including capital investment, quarterly dividends, and working capital needs, we will return cash to our shareholders, as we did most recently in January with a $5.00 per share special dividend."

Mr. Killoy made the following observations related to the Company's 2022 performance:

&nbsp;&nbsp;&nbsp;&nbsp;· The estimated unit sell-through of the Company's
products from the independent distributors to retailers decreased 25% in 2022 compared to the prior year period. For the same period,
NICS background checks, as adjusted by the National Shooting Sports Foundation, decreased 11%. These decreases are attributable to decreased
consumer demand for firearms from the unprecedented levels of the surge that began in 2020 and remained for most of 2021.The greater reduction
in the sell-through of the Company's products relative to adjusted NICS background checks may be attributable to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· More aggressive promotions, discounts, rebates,
and the extension of payment terms offered by our competitors,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· An apparent increase in sales of used firearms
at retail, which are included in the adjusted NICS checks, but are not distinguished from new gun sales, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Decreased retailer inventories as the anticipation
of further discounting may be encouraging cautious buying behavior by retailers.

&nbsp;&nbsp;&nbsp;&nbsp;· Sales of new products, including the MAX-9 pistol, LCP MAX pistol, Marlin 1895 lever-action rifles, LC
Carbine, PC Charger, and Small-Frame Autoloading Rifle represented $78.4 million or 14% of firearm sales in 2022. New product sales include
only major new products that were introduced in the past two years.

&nbsp;&nbsp;&nbsp;&nbsp;· Our profitability declined in 2022 from 2021
as our gross margin decreased from 38% to 30%. The lower margin was driven by unfavorable deleveraging of fixed costs resulting from decreased
production and sales, as well as inflationary cost increases in materials, commodities, services, energy, fuel and transportation, which
were partially offset by increased pricing.

&nbsp;&nbsp;&nbsp;&nbsp;· In 2022, the Company's finished goods inventory
and distributor inventories of the Company's products increased 92,200 units and 134,200 units, respectively, returning to a reasonable
level that will allow for the rapid fulfillment of retailer demand.

&nbsp;&nbsp;&nbsp;&nbsp;· Cash provided by operations during 2022 was $77.2 million. At December 31, 2022, our cash and short-term
investments totaled $224.3 million. Our current ratio is 2.2 to 1 and we have no debt.

&nbsp;&nbsp;&nbsp;&nbsp;· In 2022, capital expenditures totaled $27.7 million related to new product introductions, upgrades to
our manufacturing equipment and facilities, and the purchase of a previously leased 225,000 square foot facility in Mayodan, North Carolina
for $8.3 million for use in the Company's manufacturing and warehousing operations.

&nbsp;&nbsp;&nbsp;&nbsp;· In 2022, the Company returned $42.9 million to its shareholders, primarily through the payment of dividends.
An additional $88.3 million was returned to its shareholders on January 5, 2023 through the payment of a $5.00 per share special dividend
to shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;· At December 31, 2022, stockholders' equity was $316.7 million, which equates to a book value of
$17.93 per share, of which $12.70 per share was cash and short-term investments.

Today, the Company filed its Annual Report on Form 10-K for 2022. The financial statements included in this Annual Report on Form 10-K are attached to this press release.

On Thursday, February 23, 2023, Sturm, Ruger will host a webcast at 9:00 a.m. ET to discuss the fourth quarter and year-end 2022 operating results. Interested parties can listen to the webcast via this link or by visiting Ruger.com/corporate**. Those who wish to ask questions during the webcast will need to pre-register prior to the meeting.** 

The Annual Report on Form 10-K for 2022 is available on the SEC website at SEC.gov and the Ruger website at Ruger.com/corporate. Investors are urged to read the complete Annual Report on Form 10-K to ensure that they have adequate information to make informed investment judgments.

<u>About Sturm, Ruger & Co., Inc.</u>

Sturm, Ruger & Co., Inc. is one of the nation's leading manufacturers of rugged, reliable firearms for the commercial sporting market. With products made in America, Ruger offers consumers almost 800 variations of more than 40 product lines, across both the Ruger and Marlin brands. For almost 75 years, Ruger has been a model of corporate and community responsibility. Our motto, "Arms Makers for Responsible Citizens<sup>®</sup>," echoes our commitment to these principles as we work hard to deliver quality and innovative firearms.

*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.

Consolidated Balance Sheets

*(Dollars in thousands, except per share data)*

---

| | | |
|:---|:---|:---|
| *December 31,* | **2022** | 2021 |
| **Assets** |  |  |
| Current Assets |  |  |
| Cash and cash equivalents | $65173 | $21044 |
| Short-term investments | 159132 | 199971 |
| Trade receivables, net | 65449 | 57036 |
| Gross inventories | 129294 | 100023 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less LIFO reserve | (59489) | (51826) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less excess and obsolescence reserve | (4812) | (4347) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net inventories | 64993 | 43850 |
| Prepaid expenses and other current assets | 7091 | 6832 |
| Total Current Assets | 361838 | 328733 |
| Property, Plant, and Equipment | 447126 | 421282 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less allowances for depreciation | (370273) | (347651) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net property, plant and equipment | 76853 | 73631 |
| Deferred income taxes | 6109 | 536 |
| Other assets | 39963 | 39443 |
| Total Assets | $484763 | $442343 |

---

STURM, RUGER & COMPANY, INC.

Consolidated Balance Sheets (Continued)

*(Dollars in thousands, except per share data)*

 

---

| | | |
|:---|:---|:---|
| *December 31,* | **2022** | 2021 |
| **Liabilities and Stockholders' Equity** |  |  |
| Current Liabilities |  |  |
| Trade accounts payable and accrued expenses | $35658 | $36400 |
| Dividends Payable | 88343 |  |
| Contract liabilities with customers | 1031 |  |
| Product liability | 235 | 795 |
| Employee compensation and benefits | 30160 | 33154 |
| Workers' compensation | 6469 | 6760 |
| Income taxes payable | 1171 |  |
| Total Current Liabilities | 163067 | 77109 |
| Lease liability | 3039 | 1476 |
| Employee compensation | 1846 |  |
| Product liability accrual | 73 | 97 |
| Contingent liabilities |  |  |
| Stockholders' Equity |  |  |
| Common stock, non-voting, par value $1:<br> Authorized shares – 50,000; none issued |  |  |
| Common stock, par value $1:<br> Authorized shares – 40,000,000 <br>2022 – 24,378,568 issued,<br> 17,664,230 outstanding <br>2021 – 24,306,486 issued,<br> 17,596,588 outstanding | 24378 | 24306 |
| Additional paid-in capital | 45075 | 46847 |
| Retained earnings | 393097 | 438098 |
| Less: Treasury stock – at cost<br> 2022 – 6,714,338 shares<br> 2021 – 6,709,898 shares | (145812) | (145590) |
| Total Stockholders' Equity | 316738 | 363661 |
| Total Liabilities and Stockholders' Equity | $484763 | $442343 |

---

STURM, RUGER & COMPANY, INC.

Consolidated Statements of Income and Comprehensive Income

*(In thousands, except per share data)*

 

---

| | | | |
|:---|:---|:---|:---|
| *Year ended December 31,* | **2022** | 2021 | 2020 |
| Net firearms sales | $593289 | $728141 | $565863 |
| Net castings sales | 2553 | 2595 | 3005 |
| Total net sales | 595842 | 730736 | 568868 |
| Cost of products sold | 415757 | 451179 | 377427 |
| Gross profit | 180085 | 279557 | 191441 |
| Operating Expenses (Incomes): |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Selling | 36114 | 33259 | 33332 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative | 40551 | 43289 | 39013 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other operating expense (income), net | (36) | (127) | (52) |
| Total operating expenses | 76629 | 76421 | 72293 |
| Operating income | 103456 | 203136 | 119148 |
| Other income: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Royalty income | 837 | 1975 | 814 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest income | 2552 | 49 | 1126 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | (256) | (164) | (191) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other income, net | 1690 | 1598 | 84 |
| Total other income, net | 4823 | 3458 | 1833 |
| Income before income taxes | 108279 | 206594 | 120981 |
| Income taxes | 19947 | 50695 | 30583 |
| Net income and comprehensive income | $88332 | $155899 | $90398 |
| Basic Earnings Per Share | $5.00 | $8.87 | $5.17 |
| Diluted Earnings Per Share | $4.96 | $8.78 | $5.09 |
| Weighted average number of common shares outstanding – Basic | 17648850 | 17585604 | 17486054 |
| Weighted average number of common shares outstanding – Diluted | 17793348 | 17757834 | 17769856 |
| Cash Dividends Per Share | $2.42 | $3.36 | $6.51 |

---

 

 

STURM, RUGER & COMPANY, INC.

Consolidated Statements of Cash Flows

*(In thousands)*

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| | | | |
|:---|:---|:---|:---|
| *Year ended December 31,* | **2022** | 2021 | 2020 |
| **Operating Activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income | $88332 | $155899 | $90398 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to cash provided by operating activities, net of effects of acquisition: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 25789 | 26152 | 27576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 1671 | 8280 | 6128 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Excess and obsolescence inventory reserve | 501 | 953 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of assets | (36) | (127) | (52) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | (5573) | 994 | 3863 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade receivables | (8413) | 840 | (5236) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (21644) | (15726) | 10624 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade accounts payable and accrued expenses | (640) | (392) | 7954 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liability with customers | 1031 | (84) | (9539) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee compensation and benefits | (3420) | (5433) | 20910 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Product liability | (584) | (234) | 308 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses, other assets and other liabilities | (954) | 1217 | (7905) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes receivable/payable | 1171 |  | (1223) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash provided by operating activities | 77231 | 172339 | 143806 |
| **Investing Activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property, plant, and equipment additions | (27730) | (28776) | (24229) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of Marlin assets |  |  | (28316) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases of short-term investments | (365480) | (681940) | (369439) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from maturity of short-term investments | 406319 | 602976 | 377920 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net proceeds from sale of assets | 100 | 203 | 178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash provided by (used for) investing activities | 13209 | (107537) | (43886) |
| **Financing Activities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividends paid | (42718) | (59104) | (113896) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repurchase of common stock | (222) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment of employee withholding tax related to share-based compensation | (3371) | (4801) | (1297) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash used for financing activities | (46311) | (63905) | (115193) |
| Increase (decrease) in cash and cash equivalents | 44129 | 897 | (15273) |
| Cash and cash equivalents at beginning of year | 21044 | 20147 | 35420 |
| Cash and cash equivalents at end of year | $65173 | $21044 | $20147 |

---

**Non-GAAP Financial Measure**

In an effort to provide investors with additional information regarding its results, the Company refers to various United States generally accepted accounting principles ("GAAP") financial measures and two non-GAAP financial measures, EBITDA and EBITDA margin, which management believes provides useful information to investors. These non-GAAP measures may not be comparable to similarly titled measures being disclosed by other companies. In addition, the Company believes that the non-GAAP financial measures should be considered in addition to, and not in lieu of, GAAP financial measures. The Company believes that EBITDA and EBITDA margin are useful to understanding its operating results and the ongoing performance of its underlying business, as EBITDA provides information on the Company's ability to meet its capital expenditure and working capital requirements, and is also an indicator of profitability. The Company believes that this reporting provides better transparency and comparability to its operating results. The Company uses both GAAP and non-GAAP financial measures to evaluate its financial performance.

Non-GAAP Reconciliation – EBITDA

<u>EBITDA</u>

*(Unaudited, dollars in thousands)*

 

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| | | |
|:---|:---|:---|
| *Year ended December 31,* | **2022** | 2021 |
| Net income | $88332 | $155899 |
| Income tax expense | 19947 | 50695 |
| Depreciation and amortization expense | 25789 | 26152 |
| Interest expense | 256 | 164 |
| Interest income | (2552) | (49) |
| EBITDA | $131772 | $232861 |
| EBITDA margin | 22.1% | 31.9% |

---

EBITDA is defined as earnings before interest, taxes, and depreciation and amortization. The Company calculates this by adding the amount of interest expense, income tax expense and depreciation and amortization expenses that have been deducted from net income back into net income, and subtracting the amount of interest income that was included in net income from net income to arrive at EBITDA. The Company's EBITDA calculation also excludes any one-time non-cash, non-operating expense.