10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended January 1, 2021

OR

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the transition period from _________ to _________

Commission file number 0-16255

JOHNSON OUTDOORS INC.

(Exact name of Registrant as specified in its charter)

Wisconsin	39-1536083
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

555 Main Street, Racine, Wisconsin 53403

(Address of principal executive offices)

(262) 631-6600

(Registrant’s telephone number, including area code)

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

Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Common Stock, $.05 par value per share	JOUT	NASDAQ Global Select MarketSM

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒   No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒   No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act: Large accelerated filer ☐Accelerated filer ☒Non-accelerated filer ☐Smaller reporting company ☐ 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. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No ☒

As of January 29, 2021, 8,900,608 shares of Class A and 1,211,564 shares of Class B common stock of the Registrant were outstanding. 

JOHNSON OUTDOORS INC.

Index			Page No.
PART I	FINANCIAL INFORMATION
	Item 1.	Financial Statements
		Condensed Consolidated Statements of Operations - Three months ended January 1, 2021 and December 27, 2019	- 1
		Condensed Consolidated Statements of Comprehensive Income - Three months ended January 1, 2021 and December 27, 2019	- 2
		Condensed Consolidated Balance Sheets - January 1, 2021, October 2, 2020, and December 27, 2019	- 3
		Condensed Consolidated Statements of Shareholders' Equity - Three months ended January 1, 2021 and December 27, 2019	- 4
		Condensed Consolidated Statements of Cash Flows - Three months ended January 1, 2021 and December 27, 2019	- 5
		Notes to Condensed Consolidated Financial Statements	- 6
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	- 19
	Item 3.	Quantitative and Qualitative Disclosures about Market Risk	- 25
	Item 4.	Controls and Procedures	- 26
PART II	OTHER INFORMATION
	Item 1.	Legal Proceedings	- 27
	Item 1A.	Risk Factors	- 27
	Item 6.	Exhibits	- 27
		Signatures	- 28
		Exhibit Index	- 29

Index
JOHNSON OUTDOORS INC.

PART I      FINANCIAL INFORMATION

Item 1.     Financial Statements

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

	Three Months Ended
(thousands, except per share data)	January 1, 2021		December 27, 2019
Net sales	$	165,667	$	128,054
Cost of sales	90,637		74,442
Gross profit	75,030		53,612
Operating expenses:
Marketing and selling	32,533		29,305
Administrative management, finance and information systems	12,891		11,975
Research and development	6,049		5,531
Total operating expenses	51,473		46,811
Operating profit	23,557		6,801
Interest income	(82)		(655)
Interest expense	32		35
Other income, net	(2,404)		(1,168)
Profit before income taxes	26,011		8,589
Income tax expense	6,164		2,159
Net income	$	19,847	$	6,430
Weighted average common shares - Basic:
Class A	8,840		8,800
Class B	1,212		1,212
Participating securities	39		27
Weighted average common shares - Dilutive	10,091		10,039
Net income per common share - Basic:
Class A	$	1.99	$	0.65
Class B	$	1.81	$	0.59
Net income per common share - Diluted:
Class A	$	1.96	$	0.64
Class B	$	1.96	$	0.64

The accompanying notes are an integral part of the condensed consolidated financial statements.

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JOHNSON OUTDOORS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

	Three Months Ended
(thousands)	January 1, 2021		December 27, 2019
Net income	$	19,847	$	6,430
Other comprehensive income:
Foreign currency translation	2,442		700
Defined benefit pension plan:
Change in pension plans, net of tax of $34 and $21, respectively	101		61
Total other comprehensive income	2,543		761
Total comprehensive income	$	22,390	$	7,191

The accompanying notes are an integral part of the condensed consolidated financial statements.

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JOHNSON OUTDOORS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(thousands, except share data)	January 1, 2021		October 2, 2020		December 27, 2019
ASSETS
Current assets:
Cash and cash equivalents	$	195,923	$	212,437	$	138,257
Accounts receivable, net	97,386		67,292		78,249
Inventories	114,849		97,437		103,885
Other current assets	9,098		11,372		9,735
Total current assets	417,256		388,538		330,126
Property, plant and equipment, net of accumulated depreciation of $160,822, $156,541 and $146,453, respectively	63,657		63,037		59,629
Right of use assets	38,784		40,666		40,302
Deferred income taxes	10,850		10,679		11,456
Goodwill	11,219		11,184		11,193
Other intangible assets, net	8,911		9,052		11,128
Other assets	26,504		22,870		22,289
Total assets	$	577,181	$	546,026	$	486,123
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	44,908	$	37,327	$	35,384
Current lease liability	6,411		6,587		5,835
Accrued liabilities:
Salaries, wages and benefits	16,080		23,275		13,767
Accrued warranty	11,980		10,849		10,443
Income taxes payable	10,724		6,681		9,598
Accrued discounts and returns	8,648		5,113		8,146
Accrued customer programs	5,508		4,426		3,819
Other	9,029		11,349		8,269
Total current liabilities	113,288		105,607		95,261
Non-current lease liability	33,260		34,931		35,133
Deferred income taxes	1,477		1,418		1,657
Retirement benefits	801		853		1,001
Deferred compensation liability	25,033		21,585		21,009
Other liabilities	4,710		3,532		1,823
Total liabilities	178,569		167,926		155,884
Shareholders’ equity:
Common stock:
Class A shares issued and outstanding: 8,900,608, 8,873,235 and 8,858,611, respectively	443		443		443
Class B shares issued and outstanding: 1,211,564, 1,211,564 and 1,211,602, respectively	61		61		61
Capital in excess of par value	79,379		78,668		76,523
Retained earnings	314,184		296,431		253,114
Accumulated other comprehensive income	7,260		4,717		2,319
Treasury stock at cost, shares of Class A common stock: 41,977, 36,316 and 36,354, respectively	(2,715)		(2,220)		(2,221)
Total shareholders’ equity	398,612		378,100		330,239
Total liabilities and shareholders’ equity	$	577,181	$	546,026	$	486,123

The accompanying notes are an integral part of the condensed consolidated financial statements.

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JOHNSON OUTDOORS INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(unaudited)

Three Months Ended January 1, 2021
(thousands except for shares)	Shares	Common Stock		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock
BALANCE AT OCTOBER 2, 2020	10,084,799	$	504	$	78,668	$	296,431	$	4,717	$	(2,220)
Net income	—	—		—		19,847		—		—
Dividends declared	—	—		—		(2,094)		—		—
Award of non-vested shares	33,034	—		—		—		—		—
Stock-based compensation	—	—		711		—		—		—
Currency translation adjustment	—	—		—		—		2,442		—
Change in pension plans, net of tax of $34	—	—		—		—		101		—
Purchase of treasury stock at cost	(5,661)	—		—		—		—		(495)
BALANCE AT JANUARY 1, 2021	10,112,172	$	504	$	79,379	$	314,184	$	7,260	$	(2,715)

Three Months Ended December 27, 2019
(thousands except for shares)	Shares	Common Stock		Capital in Excess of Par Value		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock
BALANCE AT SEPTEMBER 27, 2019	10,045,771	$	504	$	75,856	$	248,377	$	1,558	$	(1,761)
Net income	—	—		—		6,430		—		—
Dividends declared	—	—		—		(1,693)		—		—
Award of non-vested shares	31,571	—		—		—		—		—
Stock-based compensation	—	—		667		—		—		—
Currency translation adjustment	—	—		—		—		700		—
Change in pension plans, net of tax of $21	—	—		—		—		61		—
Purchase of treasury stock at cost	(7,129)	—		—		—		—		(460)
BALANCE AT DECEMBER 27, 2019	10,070,213	$	504	$	76,523	$	253,114	$	2,319	$	(2,221)

The accompanying notes are an integral part of the condensed consolidated financial statements.

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JOHNSON OUTDOORS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Three Months Ended
(thousands)	January 1, 2021		December 27, 2019
CASH USED FOR OPERATING ACTIVITIES
Net income	$	19,847	$	6,430
Adjustments to reconcile net income to net cash used for operating activities:
Depreciation	3,349		3,176
Amortization of intangible assets	144		256
Amortization of deferred financing costs	7		7
Stock based compensation	711		667
Deferred income taxes	(146)		—
Change in operating assets and liabilities:
Accounts receivable, net	(29,693)		(33,616)
Inventories, net	(16,627)		(9,298)
Accounts payable and accrued liabilities	7,905		2,090
Other current assets	2,335		1,619
Other non-current assets	4,018		—
Other long-term liabilities	(2,818)		(412)
Other, net	(270)		(7)
	(11,238)		(29,088)
CASH USED FOR INVESTING ACTIVITIES
Proceeds from sale of productive assets	2		—
Capital expenditures	(4,390)		(3,307)
	(4,388)		(3,307)
CASH USED FOR FINANCING ACTIVITIES
Dividends paid	(2,094)		(1,689)
Purchases of treasury stock	(495)		(460)
	(2,589)		(2,149)
Effect of foreign currency rate changes on cash	1,701		419
Decrease in cash and cash equivalents	(16,514)		(34,125)
CASH AND CASH EQUIVALENTS
Beginning of period	212,437		172,382
End of period	$	195,923	$	138,257
Supplemental Disclosure:
Cash paid for taxes	$	103	$	123
Cash paid for interest	30		30

The accompanying notes are an integral part of the condensed consolidated financial statements. 

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JOHNSON OUTDOORS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1    BASIS OF PRESENTATION

The condensed consolidated financial statements included herein are unaudited. In the opinion of management, these statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly the financial position of Johnson Outdoors Inc. and subsidiaries (collectively, the “Company”) as of January 1, 2021 and December 27, 2019, and their results of operations for the three month periods then ended and cash flows for the three month periods then ended. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 2, 2020 which was filed with the Securities and Exchange Commission on December 11, 2020.

Due to seasonal variations and other factors, some of which are described herein, including related to the coronavirus (COVID-19) outbreak and resulting pandemic, the results of operations for the three months ended January 1, 2021 are not necessarily indicative of the results to be expected for the Company’s full 2021 fiscal year.  See "Coronavirus (COVID-19) below and “Seasonality” and "Coronavirus (COVID-19)" in the Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere herein for additional information.

The Company considers all short-term investments in interest-bearing accounts and all securities and other instruments with an original maturity of three months or less, to be equivalent to cash. Cash equivalents are stated at cost which approximates market value.

All monetary amounts, other than share and per share amounts, are stated in thousands.

Coronavirus (COVID-19)

In March 2020, the World Health Organization recognized the current coronavirus (COVID-19) outbreak as a global pandemic. In response to the COVID-19 outbreak, the governments of many countries, states, cities and other geographic regions imposed varying degrees of restrictions on social and commercial activity, including imposing travel restrictions, issuing quarantine, shelter-in-place and stay at home orders and guidelines and related actions, mandating mask wearing, limiting business capacity and generally restricting freedom of movement, in order to promote social distancing and other similar programs all in an effort to slow the spread of the illness.

While some government mandates eased in the latter half of fiscal 2020, these mandates continued to emphasize social distancing measures to the general public. As a result, we saw increased participation in fishing, camping and watercraft recreation and related demand for our products, largely driven by consumer desire to engage in socially distant and safe activities in the great outdoors in the latter part of fiscal 2020, which continued into the first quarter of fiscal 2021. Nonetheless, the full extent to which the COVID-19 pandemic will impact our business, results of operations, and financial condition, including with respect to consumer buying patterns for the rest of our fiscal 2021, will depend on future developments, including any potential worsening or improvement of the pandemic, which are beyond our control and which remain highly uncertain and cannot be predicted. This includes, but is not limited to, the duration, spread, severity and impact of the COVID-19 pandemic, vaccine distribution and effectiveness, or future waves, increasing outbreaks or hot spots of the pandemic in our areas of operations or in key markets, the effects of the pandemic on our customers, consumers, suppliers and vendors and the remedial actions and stimulus measures adopted by federal, state and local governments in reaction to the pandemic. Further, the authorization of vaccines for COVID-19 by governments around the world, including the distribution of same, may further impact commercial activity and customer or consumer buying behavior, and the extent to which these developments will impact demand for, and participation in, outdoor recreation and related products is unknown. As the COVID-19 pandemic continues to impact various key regions of the world, even after it subsides, we may continue to experience adverse impacts to our business, including our supply chain, as a result of any economic recession that has occurred or may occur in the future. As a result, the Company cannot reasonably estimate the full impact of the COVID-19 pandemic on Company operations and profitability at this time as the situation is dynamic and constantly changing. We continue to monitor evolving economic and general business conditions stemming from the COVID-19 pandemic and the actual and potential impacts on our financial position, results of operations and cash flows.

2    ACCOUNTS RECEIVABLE

Accounts receivable are stated net of allowances for doubtful accounts of $2,823, $2,697 and $3,062 as of January 1, 2021, October 2, 2020 and December 27, 2019, respectively. The increase in net accounts receivable to $97,386 as of

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JOHNSON OUTDOORS INC.

January 1, 2021 from $67,292 as of October 2, 2020 is largely attributable to the impact of the COVID-19 pandemic on the buying patterns of the Company’s customers, which has shifted the seasonal nature of the Company’s business and has caused increases in sales volumes between periods. The determination of the allowance for doubtful accounts is based on a combination of factors. In circumstances where specific collection concerns about a receivable exist (including as a result of the impact of COVID-19), a reserve is established to value the affected account receivable at an amount the Company believes will be collected. For all other customers, the Company recognizes allowances for doubtful accounts based on historical experience of bad debts as a percent of accounts receivable outstanding for each business segment. Uncollectible accounts are written off against the allowance for doubtful accounts after collection efforts have been exhausted. The Company typically does not require collateral on its accounts receivable.

3    EARNINGS PER SHARE (“EPS”)

Net income or loss per share of Class A common stock and Class B common stock is computed using the two-class method.  Grants of restricted stock which receive non-forfeitable dividends are classified as participating securities and are required to be included as part of the basic weighted average share calculation under the two-class method.

Holders of Class A common stock are entitled to cash dividends equal to 110% of all dividends declared and paid on each share of Class B common stock. The Company grants shares of unvested restricted stock in the form of Class A shares, which carry the same distribution rights as the Class A common stock described above.  As such, the undistributed earnings for each period are allocated to each class of common stock based on the proportionate share of the amount of cash dividends that each such class is entitled to receive.

Basic EPS

Basic net income or loss per share is computed by dividing net income or loss allocated to Class A common stock and Class B common stock by the weighted-average number of shares of Class A common stock and Class B common stock outstanding, respectively.  In periods with cumulative year to date net income and undistributed income, the undistributed income for each period is allocated to each class of common stock based on the proportionate share of the amount of cash dividends that each such class is entitled to receive.  In periods where there is a cumulative year to date net loss or no undistributed income because distributions through dividends exceed net income, Class B shares are treated as anti-dilutive and, therefore, net losses are allocated equally on a per share basis among all participating securities.

For the three month periods ended January 1, 2021 and December 27, 2019, basic income per share for the Class A and Class B shares has been presented using the two class method and reflects the allocation of undistributed income described above. 

Diluted EPS

Diluted net income per share is computed by dividing allocated net income by the weighted-average number of common shares outstanding, adjusted for the effect of dilutive stock options, restricted stock units (“stock units” or “units”) and non-vested restricted stock.  Anti-dilutive stock options, units and non-vested stock are excluded from the calculation of diluted EPS.  The computation of diluted net income per share of Class A common stock assumes that Class B common stock is converted into Class A common stock.  Therefore, diluted net income per share is the same for both Class A and Class B common shares.  In periods where the Company reports a net loss, the effect of anti-dilutive stock options and units is excluded and diluted loss per share is equal to basic loss per share for both classes of stock.

For the three month periods ended January 1, 2021 and December 27, 2019, diluted net income per share reflects the effect of dilutive stock units and assumes the conversion of Class B common stock into Class A common stock. 

Non-vested stock that could potentially dilute earnings per share in the future which were not included in the fully diluted computation because they would have been anti-dilutive totaled 40,647 and 40,312 for the three months ended January 1, 2021 and December 27, 2019, respectively. Stock units that could potentially dilute earnings per share in the future and which were not included in the fully diluted computation because they would have been anti-dilutive were 30,786 and 41,111 for the three month periods ended January 1, 2021 and December 27, 2019, respectively.

Dividends per share

Dividends per share for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

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JOHNSON OUTDOORS INC.

	Three Months Ended
	January 1, 2021		December 27, 2019
Dividends declared per common share:
Class A	$	0.21	$	0.17
Class B	$	0.19	$	0.15

4    STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS

The Company’s current stock ownership plans allow for issuance of stock options to acquire shares of Class A common stock by key executives and non-employee directors. Current plans also allow for issuance of shares of restricted stock, restricted stock units or stock appreciation rights in lieu of stock options.

Under the Company’s 2012 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 507,510 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at January 1, 2021. Share awards previously made under the Company's 2010 Long-Term Stock Incentive Plan, which no longer allows for additional share grants, also remain outstanding.

Non-vested Stock

All shares of non-vested restricted stock awarded by the Company have been granted in the form of shares of Class A common stock at their fair market value on the date of grant and vest within one year from the date of grant for stock granted to directors and four years from the date of grant for stock granted to officers and employees.  The fair value at date of grant is based on the number of shares granted and the average of the Company’s high and low Class A common stock price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock price on the last preceding date on which the Company’s Class A shares traded.

A summary of non-vested stock activity for the three months ended January 1, 2021 related to the Company’s stock ownership plans is as follows:

	Shares	Weighted Average Grant Price
Non-vested stock at October 2, 2020	40,492	$	62.15
Non-vested stock grants	8,758	88.49
Restricted stock vested	(7,586)	43.12
Non-vested stock at January 1, 2021	41,664	71.15

Non-vested stock grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of shares by tendering a portion of the vested shares back to the Company.  Shares tendered back to the Company were 2,341 and 4,054 during the three month periods ended January 1, 2021 and December 27, 2019, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $279 and $240 for the three month periods ended January 1, 2021 and December 27, 2019, respectively. Unrecognized compensation cost related to non-vested stock as of January 1, 2021 was $1,672, which amount will be amortized to expense through November 2024 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the three month periods ended January 1, 2021 and December 27, 2019 was $658 and $839, respectively.

Restricted Stock Units

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JOHNSON OUTDOORS INC.

All restricted stock units (RSUs) awarded by the Company have been granted in the form of units payable in shares of Class A common stock upon vesting. The units are valued at the fair market value of a share of Class A common stock on the date of grant and vest within one year from the date of grant for RSUs granted to directors and three years from the date of grant for RSUs granted to employees.  The fair value at the date of grant is based on the number of units granted and the average of the Company’s high and low Class A common stock trading price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock trading price on the last preceding date on which the Company’s Class A shares traded.

A summary of RSU activity for the three months ended January 1, 2021 follows:

	Number of RSUs	Weighted Average Grant Price
RSUs at October 2, 2020	67,821	$	68.34
RSUs granted	20,059	88.49
RSUs vested	(18,112)	43.49
RSUs at January 1, 2021	69,768	80.58

Stock compensation expense, net of forfeitures, related to RSUs was $432 and $420 for the three months ended January 1, 2021 and December 27, 2019, respectively. Unrecognized compensation cost related to non-vested RSUs as of January 1, 2021 was $3,050, which amount will be amortized to expense through September 2023 or adjusted for changes in future estimated or actual forfeitures.

RSU grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of units and issuance of unrestricted shares of Class A common stock by tendering a portion of such unrestricted shares back to the Company. Shares tendered back to the Company for this purpose were 3,320 and 3,075 during the three month periods ended January 1, 2021 and December 27, 2019, respectively.

The fair value of restricted stock units recognized as a tax deduction during the three month periods ended January 1, 2021 and December 27, 2019 was $2,148 and $1,426, respectively.

Compensation expense related to units earned by employees (as opposed to grants to outside directors) is based upon the attainment of certain Company financial goals related to cumulative net sales and cumulative operating profit over a three-year performance period. Awards are only paid if at least 80% of the target levels are met and maximum payouts are made if 120% or more of target levels are achieved. The payouts for achievement at the threshold levels of performance are equal to 50% of the target award amount. The payouts for achievement at maximum levels of performance are equal to 150% of the target award amount. To the extent earned, awards are issued in shares of Company Class A common stock after the end of the three-year performance period.

Employees’ Stock Purchase Plan

The Company’s shareholders have adopted the Johnson Outdoors Inc. 2009 Employees’ Stock Purchase Plan, which was most recently amended on March 2, 2017, and which provides for the issuance of shares of Class A common stock at a purchase price of not less than 85% of the fair market value of such shares on the date of grant or on the date of purchase, whichever is lower.

During the three month period ended January 1, 2021, the Company issued 0 shares of Class A common stock and recognized $0 of expense in connection with the Employees' Stock Purchase Plan. During the three month period ended December 27, 2019, the Company issued 0 shares of Class A common stock and recognized $7 of expense in connection with the Plan.

5    PENSION PLANS

The Company has two non-contributory defined benefit pension plans covering certain of its U.S. employees. Retirement benefits are generally provided based on the employees’ years of service and average earnings. Normal retirement age is 65, with provisions for earlier retirement.

The Company made contributions of $43 and $44 to its pension plans for the three months ended January 1, 2021 and December 27, 2019, respectively.

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JOHNSON OUTDOORS INC.

During the first quarter of fiscal 2021, Company management commenced actions to terminate both of the pension plans. As part of the termination of these plans, all plan participants will have the option of taking a lump sum payment or receiving payout pursuant to an annuity contract. When the termination and related payouts occur, they are estimated to unfavorably impact net income by approximately $4 to $5 million.

The components of net periodic benefit cost related to Company sponsored defined benefit plans for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

	Three Months Ended
	January 1, 2021		December 27, 2019
Components of net periodic benefit cost:
Service cost	$	—	$	—
Interest on projected benefit obligation	233		276
Less estimated return on plan assets	160		214
Amortization of unrecognized losses (gains)	134		82
Net periodic benefit cost	$	207	$	144

6    INCOME TAXES

For the three months ended January 1, 2021 and December 27, 2019, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

	Three Months Ended
(thousands, except tax rate data)	January 1, 2021			December 27, 2019
Profit before income taxes	$	26,011		$	8,589
Income tax expense	6,164			2,159
Effective income tax rate	23.7		%	25.1		%

The decrease in the effective tax rate for the three months ended January 1, 2021 compared to the prior year period is primarily due to a current period income tax benefit of an intra-entity transfer of an asset other than inventory.

The impact of the Company’s operations in jurisdictions where a valuation allowance is assessed is removed from the overall effective tax rate methodology and recorded directly based on year to date results for the year for which no tax expense or benefit can be recognized.  The significant tax jurisdictions that have a valuation allowance for the periods ended January 1, 2021 and December 27, 2019 were:

January 1, 2021	December 27, 2019
France	France
Indonesia	Indonesia
Switzerland	Switzerland

The Company regularly assesses the adequacy of its provisions for income tax contingencies in accordance with the applicable authoritative guidance on accounting for income taxes.  As a result, the Company may adjust the reserves for unrecognized tax benefits due to the impact of changes in its assumptions or as a result of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities and lapses of statutes of limitation.  The Company’s 2021 fiscal year tax expense is anticipated to be unchanged related to uncertain income tax positions.

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In accordance with its accounting policy, the Company recognizes accrued interest and penalties related to unrecognized benefits as a component of income tax expense.  The Company is projecting accrued interest of $300 related to uncertain income tax positions for the fiscal year ending October 1, 2021.

The Company files income tax returns, including returns for its subsidiaries, with federal, state, local and foreign taxing jurisdictions.   As of the date of this report, the following tax years remain open to examination by the respective significant tax jurisdictions:

Jurisdiction	Fiscal Years
United States	2017-2020
Canada	2016-2020
France	2017-2020
Germany	2017-2020
Italy	2018-2020
Switzerland	2010-2020

7    INVENTORIES

The Company values inventory at the lower of cost (determined using the first-in first-out method) or net realizable value. Inventories at the end of the respective periods consisted of the following:

	January 1, 2021		October 2, 2020		December 27, 2019
Raw materials	$	63,353	$	48,874	$	47,208
Work in process	38		39		463
Finished goods	51,458		48,524		56,214
	$	114,849	$	97,437	$	103,885

8    GOODWILL

The changes in goodwill during the three months ended January 1, 2021 and December 27, 2019 were as follows:

	January 1, 2021		December 27, 2019
Balance at beginning of period	$	11,184	$	11,186
Amount attributable to movements in foreign currency rates	35		7
Balance at end of period	$	11,219	$	11,193

The Company evaluates the carrying value of goodwill for a reporting unit on an annual basis or more frequently when events and circumstances warrant such an evaluation.  In conducting this analysis, the Company uses the income approach to compare the reporting unit's carrying value to its indicated fair value. Fair value is determined primarily by using a discounted cash flow methodology that requires considerable management judgment and long-term assumptions and is considered a Level 3 (unobservable) fair value determination in the fair value hierarchy (see Note 13) below.

9    WARRANTIES

The Company provides warranties on certain of its products as they are sold. The following table summarizes the Company’s warranty activity for the three months ended January 1, 2021 and December 27, 2019.

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	January 1, 2021		December 27, 2019
Balance at beginning of period	$	10,849	$	9,190
Expense accruals for warranties issued during the period	3,177		3,335
Less current period warranty claims paid	2,046		2,082
Balance at end of period	$	11,980	$	10,443

10    CONTINGENCIES

The Company is subject to various legal actions and proceedings in the normal course of business, including those related to commercial disputes, product liability, intellectual property and regulatory matters. The Company is insured against loss for certain of these matters. Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome of any pending litigation will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

11    INDEBTEDNESS

The Company had no debt outstanding at January 1, 2021, October 2, 2020, or December 27, 2019.

Revolvers

The Company and certain of its subsidiaries have entered into an unsecured credit facility with PNC Bank National Association and Associated Bank, N.A. ("the Lending Group").  This credit facility consists of a $75 million Revolving Credit Facility among the Company, certain of the Company’s subsidiaries, PNC Bank National Association, as lender and as administrative agent, and the other lender named therein (the “Credit Agreement” or “Revolver”).  The Revolver has an expiration date of November 15, 2022 and provides for borrowing of up to an aggregate principal amount not to exceed $75,000 with a $50,000 accordion feature that gives the Company the option to increase the maximum financing availability (i.e., an aggregate borrowing amount of $125,000) subject to the conditions of the Credit Agreement and subject to the approval of the lenders.

The interest rate on the Revolver is based on LIBOR plus an applicable margin, which margin resets each quarter.  The applicable margin ranges from 1.00% to 1.75% and is dependent on the Company’s leverage ratio for the trailing twelve month period.  The interest rates on the Revolver at January 1, 2021 and December 27, 2019 were approximately 1.1% and 2.8%, respectively.

The Credit Agreement restricts the Company's ability to incur additional debt, includes maximum leverage ratio and minimum interest coverage ratio covenants and is unsecured.

Other Borrowings

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of January 1, 2021 or December 27, 2019.  The Company utilizes letters of credit primarily as security for the payment of future claims under its workers’ compensation insurance, which totaled approximately $181 and $181 as of January 1, 2021 and December 27, 2019, respectively.

12    DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The following disclosures describe the Company’s objectives in using derivative instruments, the business purpose or context for using derivative instruments, and how the Company believes the use of derivative instruments helps achieve the stated objectives.  In addition, the following disclosures describe the effects of the Company’s use of derivative instruments and hedging activities on its financial statements.

Foreign Exchange Risk

The Company has significant foreign operations, for which the functional currencies are denominated primarily in euros, Swiss francs, Hong Kong dollars and Canadian dollars. As the values of the currencies of the foreign countries in which the Company has operations increase or decrease relative to the U.S. dollar, the sales, expenses, profits, losses, assets and liabilities of the Company’s foreign operations, as reported in the Company’s consolidated financial statements, increase or decrease, accordingly.  Approximately 10% of the Company’s revenues for the three month

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period ended January 1, 2021 were denominated in currencies other than the U.S. dollar. Approximately 4% were denominated in euros, approximately 4% were denominated in Canadian dollars and approximately 1% were denominated in Hong Kong dollars, with the remaining revenues denominated in various other foreign currencies. Changes in foreign currency exchange rates can cause the Company to experience unexpected financial losses or cash flow needs.

The Company may mitigate a portion of the fluctuations in certain foreign currencies through the use of foreign currency forward contracts.  Foreign currency forward contracts enable the Company to lock in the foreign currency exchange rate to be paid or received for a fixed amount of currency at a specified date in the future. The Company may use such foreign currency forward contracts to mitigate the risk associated with changes in foreign currency exchange rates on financial instruments and known commitments, including commitments for inventory purchases, denominated in foreign currencies. As of January 1, 2021 and December 27, 2019, the Company held no foreign currency forward contracts.

13    FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. A fair value hierarchy has been established based on three levels of inputs, of which the first two are considered observable and the last unobservable.

•Level 1 - Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets or liabilities.

•Level 2 - Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments.

•Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances.

The carrying amounts of cash, cash equivalents, short term investments, accounts receivable, and accounts payable approximated their fair values at January 1, 2021, October 2, 2020 and December 27, 2019 due to the short term maturities of these instruments. When indicators of impairment are present, the Company may be required to value certain long-lived assets such as property, plant, and equipment, and other intangibles at their fair value.

Valuation Techniques

Rabbi Trust Assets

Rabbi trust assets are classified as trading securities and are comprised of marketable debt and equity securities that are marked to fair value based on unadjusted quoted prices in active markets.  The rabbi trust assets are used to fund amounts the Company owes to certain officers and other employees under the Company’s non-qualified deferred compensation plan.  These assets are included in "Other assets" in the Company's Condensed Consolidated Balance Sheets, and the mark to market adjustments on the assets are recorded in “Other income, net” in the accompanying Condensed Consolidated Statements of Operations. The offsetting deferred compensation liability is also reported at fair value as "Deferred compensation liability" in the Company's accompanying Condensed Consolidated Balance Sheets. Changes in the liability are recorded in "Administrative management, finance and information systems" expense in the accompanying Condensed Consolidated Statements of Operations.

The following table summarizes the Company’s financial assets measured at fair value as of January 1, 2021:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	25,032	$	—	$	—	$	25,032

The following table summarizes the Company’s financial assets measured at fair value as of October 2, 2020:

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	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	21,550	$	—	$	—	$	21,550

The following table summarizes the Company’s financial assets measured at fair value as of December 27, 2019:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	20,978	$	—	$	—	$	20,978

The effect of changes in the fair value of financial instruments on the accompanying Condensed Consolidated Statements of Operations for the three month periods ended January 1, 2021 and December 27, 2019 was:

		Three Months Ended
	Location of income loss recognized in Statement of Operations	January 1, 2021		December 27, 2019
Rabbi trust assets	Other income, net	$	2,596	$	1,192

There were no assets or liabilities measured at fair value on a non-recurring basis in periods subsequent to their initial recognition for either of the three month periods ended January 1, 2021 or December 27, 2019.

14    NEW ACCOUNTING PRONOUNCEMENTS

    Recently adopted accounting pronouncements

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). In July 2018, the FASB also issued ASU 2018-10 Codification Improvements to Topic 842, Leases and ASU 2018-11 Leases (Topic 842) Targeted Improvements. In February 2019, the FASB also issued ASU 2019-01 Leases (Topic 842): Codification Improvements. This ASU and the updates to this ASU require organizations to recognize lease assets and lease liabilities on the balance sheet and to disclose key information about leasing arrangements. This guidance was effective for the Company in the first quarter of fiscal year 2020, and may be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements with certain practical expedients available. The Company adopted the provisions of these ASU's using the modified retrospective approach at the beginning of the first quarter of fiscal 2020, coinciding with the standard's effective date. The additional disclosures required by the ASU and its updates are included in Note 18 "Leases" of these Notes to the Condensed Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses (Topic 326)” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively Topic 326). Topic 326 requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This replaces the existing incurred loss model with an expected loss model and requires the use of forward-looking information to calculate credit loss estimates. This guidance was effective for the Company in the first quarter of fiscal year 2021, and must be adopted by applying a cumulative effect adjustment to retained earnings. The Company adopted the provisions of this ASU at the beginning of the first quarter of fiscal 2021, however the ASU did not have a significant impact on its financial statements, and therefore no adjustment to retained earnings was necessary.

    Recently issued accounting pronouncements

In August 2018, the FASB issued ASU 2018-14, Changes to the Disclosure Requirements for Defined Benefit Plans (Topic 715), which modifies the disclosure requirements for employers that sponsor defined pension or postretirement plans. The amendments in this guidance are effective for fiscal years ending after December 15, 2020, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures.

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In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes. ASU 2019-12 is intended to simplify accounting for income taxes. It removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted. The Company does not expect adoption of the new guidance to have a significant impact on its financial statements.

15    REVENUES

Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The amount of consideration received can vary, primarily because of customer incentive or rebate arrangements. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled based on historical experience and projected market expectations. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. For all contracts with customers, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component as the period between the transfer of the promised goods and the customer's payment is expected to be one year or less. Sales are made on normal and customary short-term credit terms, generally ranging from 30 to 90 days, or upon delivery of point of sale transactions. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The Company enters into contractual arrangements with customers in the form of individual customer orders which specify the goods, quantity, pricing, and associated order terms. The Company does not have contracts which are satisfied over time. Due to the nature of these contracts, no significant judgment exists in relation to the identification of the customer contract, satisfaction of the performance obligation, or transaction price. The Company expenses incremental costs of obtaining a contract due to the short-term nature of the contracts.

Estimated costs of returns, allowances and discounts, based on historic experience, are accrued as a reduction to sales when revenue is recognized. The Company provides customers the right to return eligible products under certain circumstances. At January 1, 2021, the right to returns asset was $1,367 and the accrued returns liability was $3,621. At December 27, 2019, the right to returns asset was $1,112 and the accrued returns liability was $3,394. The Company also offers assurance-type warranties relating to its products sold to end customers that continue to be accounted for under ASC 460 Guarantees.

The Company generally accounts for shipping and handling activities as a fulfillment activity, consistent with the timing of revenue recognition; that is, when a customer takes control of the transferred goods. In the event that a customer were to take control of a product upon or after shipment, the Company has made an accounting policy election to treat such shipping and handling activities as a fulfillment cost. Shipping and handling fees billed to customers are included in "Net Sales," and shipping and handling costs are recognized within "Marketing and selling expenses" in the same period the related revenue is recognized.

The Company has a wide variety of seasonal, outdoor recreation products used primarily for fishing from a boat, diving, paddling, hiking and camping, that are sold to a variety of customers in multiple end markets. Nonetheless, the revenue recognition policies are similar among all the various products sold by the Company.

    See Note 16 for required disclosures of disaggregated revenue.

16    SEGMENTS OF BUSINESS

The Company conducts its worldwide operations through separate business segments, each of which represents major product lines. Operations are conducted in the United States and various foreign countries, primarily in Europe, Canada and the Pacific Basin.  During the three month periods ended January 1, 2021 and December 27, 2019, combined net sales to two customers of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $53,573 and $32,321, respectively, of the Company's consolidated revenues.

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Net sales and operating profit include both sales to customers, as reported in the Company’s accompanying Condensed Consolidated Statements of Operations, and interunit transfers, which are priced to recover cost plus an appropriate profit margin. Total assets represent assets that are used in the Company’s operations in each business segment at the end of the periods presented.

A summary of the Company’s operations by business segment is presented below:

	Three Months Ended
	January 1, 2021		December 27, 2019		October 2, 2020
Net sales:
Fishing:
Unaffiliated customers	$	126,859	$	99,193
Interunit transfers	140		85
Camping:
Unaffiliated customers	12,185		7,505
Interunit transfers	9		9
Watercraft Recreation:
Unaffiliated customers	12,397		4,803
Interunit transfers	46		6
Diving
Unaffiliated customers	14,090		16,458
Interunit transfers	3		1
Other / Corporate	136		95
Eliminations	(198)		(101)
Total	$	165,667	$	128,054
Operating profit (loss):
Fishing	$	27,763	$	15,018
Camping	2,808		66
Watercraft Recreation	1,069		(1,563)
Diving	(341)		205
Other / Corporate	(7,742)		(6,925)
	$	23,557	$	6,801
Total assets (end of period):
Fishing	$	244,217	$	216,783	$	206,244
Camping	40,901		32,815		37,514
Watercraft Recreation	24,058		20,611		21,038
Diving	68,818		64,799		67,393
Other / Corporate	199,187		151,115		213,837
	$	577,181	$	486,123	$	546,026

1

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17    ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended January 1, 2021 were as follows:

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at October 2, 2020	$	7,323	$	(2,606)	$	4,717
Other comprehensive income before reclassifications	2,442		—		2,442
Amounts reclassified from accumulated other comprehensive income	—		135		135
Tax effects	—		(34)		(34)
Balance at January 1, 2021	$	9,765	$	(2,505)	$	7,260

The changes in AOCI by component, net of tax, for the three months ended December 27, 2019 were as follows: 

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at September 27, 2019	$	4,790	$	(3,232)	$	1,558
Other comprehensive income before reclassifications	700		—		700
Amounts reclassified from accumulated other comprehensive income	—		82		82
Tax effects	—		(21)		(21)
Balance at December 27, 2019	$	5,490	$	(3,171)	$	2,319

    The reclassifications out of AOCI for the three months ended January 1, 2021 and December 27, 2019 were as follows: 

	Three Months Ended
	January 1, 2021		December 27, 2019		Statement of Operations Presentation
Unamortized loss on defined benefit pension plans:
Amortization of loss	$	135	$	82	Other income and expense
Tax effects	(34)		(21)		Income tax expense
Total reclassifications for the period	$	101	$	61

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18    LEASES

    Adoption of Topic 842

At the beginning of fiscal year 2020, the Company adopted ASU 2016-02 and all subsequent ASUs that modified accounting standards Topic 842 using a modified retrospective adoption method, in which right-of-use ("ROU") assets and lease liabilities are recognized in the condensed consolidated balance sheets. Under the effective date transition method, financial results reported in periods prior to fiscal year 2020 are unchanged. The Company also elected the package of practical expedients permitted under the standard, which does not require reassessment of prior conclusions related to contracts containing a lease, lease classification and initial direct lease costs. As an ongoing accounting policy election, the Company will exclude short-term leases (terms of 12 months or less) from the balance sheet presentation and will account for non-lease and lease components in a contract as a single lease component for most asset classes. All leases in which the Company is the lessee are classified as operating leases, and the Company does not have any finance leases or sublease agreements. Additionally, the Company does not have any leases in which it is the lessor.

The adoption of the new standard had a significant impact on the Company's condensed consolidated balance sheet due to the recognition of approximately $41 million of lease liabilities with corresponding ROU assets for operating leases. The new standard did not have a significant impact on the condensed consolidated statements of operations or cash flows, and did not impact our debt covenant compliance under our current credit agreements.

The Company determines if an arrangement is a lease at inception. The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases. As of January 1, 2021, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 15 years. Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI). Some leases also contain options to extend or terminate the lease. To the extent the Company is reasonably certain to exercise these options, they have been considered in the calculation of the ROU assets and lease liabilities. Under current lease agreements, there are no residual value guarantees or restrictive lease covenants. In calculating the ROU assets and lease liabilities, several assumptions and judgments were made by the Company, including whether a contract is or contains a lease under the new definition, and the determination of the discount rate, which is assumed to be the incremental borrowing rate. The incremental borrowing rate is derived from information available to the Company at the lease commencement date based on lease length and location.

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended January 1, 2021 and December 27, 2019 were as follows:

	Three months ended		Three months ended
	January 1, 2021		December 27, 2019
Lease Cost
Operating lease costs	$	2,012	$	1,776
Short-term lease costs	391		483
Variable leases costs	46		43
Total lease cost	$	2,449	$	2,302

Included in the amounts in the table above, were rent expense to related parties of $255 and $246 for the three months ended January 1, 2021 and December 27, 2019, respectively.

As of January 1, 2021, the Company did not have any finance leases. There were no significant new leases entered into during the quarter ended January 1, 2021. Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:

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	Three months ended			Three months ended
	January 1, 2021			December 27, 2019
Operating leases:
Operating lease ROU assets	$	38,784		$	40,302
Current operating leases liabilities	6,411			5,835
Non-current operating lease liabilities	33,260			35,133
Total operating lease liabilities	$	39,671		$	40,968
Weighted average remaining lease term (in years)	9.88			10.67
Weighted average discount rate	2.84		%	2.83		%
Cash paid for amounts included in the measurement of lease liabilities	$	1,857		$	1,571

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at January 1, 2021 were as follows:

Year	Related parties included in total		Total
Remainder of 2021	$	868	$	6,508
2022	193		5,316
2023	—		4,619
2024	—		4,617
2025	—		3,676
Thereafter	—		21,512
Total undiscounted lease payments	1,061		46,248
Less: Imputed interest	(9)		(6,577)
Total net lease liability	$	1,052	$	39,671

As of January 1, 2021, the Company did not have any additional significant operating leases commitments that have not yet commenced.

Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) includes comments and analysis relating to the results of operations and financial condition of Johnson Outdoors Inc. and its subsidiaries (collectively, the “Company”) as of and for the three month periods ended January 1, 2021 and December 27, 2019. All monetary amounts, other than share and per share amounts, are stated in thousands.

Our MD&A is presented in the following sections:

•Forward Looking Statements

•Trademarks

•Overview

•Results of Operations

•Liquidity and Financial Condition

•Contractual Obligations and Off Balance Sheet Arrangements

•Critical Accounting Policies and Estimates

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This discussion should be read in conjunction with the Condensed Consolidated Financial Statements and related notes that immediately precede this section, as well as the Company’s Annual Report on Form 10-K for the fiscal year ended October 2, 2020 which was filed with the Securities and Exchange Commission on December 11, 2020.

Forward Looking Statements

Certain matters discussed in this Form 10-Q are “forward-looking statements,” and the Company intends these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and is including this statement for purposes of those safe harbor provisions. These forward-looking statements can generally be identified as such because they include phrases such as the Company “expects,” “believes,” “anticipates,” “intends,” use of words such as “confident,” “could,” “may,” “planned,” “potential,” “should,” “will,” “would” or the negative of such words or other words of similar meaning. Similarly, statements that describe the Company’s future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties which could cause actual results or outcomes to differ materially from those currently anticipated.

Factors that could affect actual results or outcomes include the matters described under the caption “Risk Factors” in Item 1A of the Company’s Form 10-K which was filed with the Securities and Exchange Commission on December 11, 2020, the update to such "Risk Factors" section in Part II, Item 1A in this Form 10-Q and the following:  changes in economic conditions, consumer confidence levels and discretionary spending patterns in key markets; uncertainties stemming from changes in U.S. trade policies, tariffs, and the reaction of other countries to such changes; the global outbreaks of disease, such as the COVID-19 pandemic which has affected, and may continue to affect, market and economic conditions, and the timing, pricing and continued availability of raw materials and components from our supply chain, along with wide-ranging impacts on employees, customers and various aspects of our operations; the Company’s success in implementing its strategic plan, including its targeted sales growth platforms, innovation focus and its increasing digital presence; litigation costs related to actions of and disputes with third parties, including competitors; the Company’s continued success in its working capital management and cost-structure reductions; the Company’s success in integrating strategic acquisitions; the risk of future writedowns of goodwill or other long-lived assets; the ability of the Company’s customers to meet payment obligations; the impact of actions of the Company's competitors with respect to product development or enhancement or the introduction of new products into the Company's markets; movements in foreign currencies, interest rates or commodity costs; fluctuations in the prices of raw materials or the availability of raw materials used by the Company; any disruptions in the Company's supply chain as a result of material fluctuations in the Company's order volumes and requirements for raw materials and other components necessary to manufacture and produce the Company's products; the success of the Company’s suppliers and customers and the impact of any consolidation in the industries of the Company's suppliers and customers; the ability of the Company to deploy its capital successfully; unanticipated outcomes related to outsourcing certain manufacturing processes; unanticipated outcomes related to litigation matters; and adverse weather conditions. Shareholders, potential investors and other readers are urged to consider these factors in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements included herein are only made as of the date of this filing. The Company assumes no obligation, and disclaims any obligation, to update such forward-looking statements to reflect subsequent events or circumstances.

Trademarks

We have registered the following trademarks, among others, which may be used in this report: Minn Kota®, Cannon®, Humminbird®, Eureka!®, Jetboil®, Old Town®, Ocean Kayak®, Carlisle®, and SCUBAPRO®.

Overview

The Company is a leading global manufacturer and marketer of branded seasonal outdoor recreation products used primarily for fishing, diving, paddling and camping.  The Company’s portfolio of well-known consumer brands has attained leading market positions due to continuous innovation, marketing excellence, product performance and quality.  The Company’s values and culture support innovation in all areas, promoting and leveraging best practices and synergies within and across its subsidiaries to advance the Company’s strategic vision set by executive management and approved by the Company’s Board of Directors.  The Company is controlled by Helen P. Johnson-Leipold, the Company’s Chairman and Chief Executive Officer, members of her family and related entities.

Coronavirus (COVID-19) 

Due to the timing of the COVID-19 outbreak, the Company's fiscal 2020 first quarter was not impacted by the pandemic. The Company began seeing the impacts of the pandemic during the second fiscal quarter of 2020, which continued through the remainder of fiscal year 2020 and into the fiscal 2021 first quarter.

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JOHNSON OUTDOORS INC.

Due to the unique aspects of this pandemic and the various government prescriptions for the general public to maintain social distancing and avoid activities involving large crowds or being in confined spaces with others to mitigate the spread of the virus, the warm weather outdoor recreation industry has benefited from increased participation in outdoor recreation activities. As consumers took advantage of being outdoors, the Company has seen an increase in demand for many of its warm weather outdoor recreational products. As a result, each of our Fishing, Camping and Watercraft Recreation segments experienced increased sales volumes in the first quarter of the current fiscal year versus the prior period. Our customers’ inventory levels, were drawn down during the past fiscal year as consumers purchased related products, and accordingly, we experienced strong orders from our customers in the fiscal 2021 first quarter to fill their pipelines in anticipation of the fiscal 2021 warm-weather recreational season. Managing the supply chain, and ensuring the availability of components, parts and other raw materials across our segments will be essential to meeting this increased demand.

The Company continues to monitor and strategically plan for the longer-term impacts from the COVID-19 pandemic on demand for the Company's products, as well as the impact on its supply chain, including with respect to the timely availability of raw materials and other components that get incorporated into the Company's end products. Nonetheless because the Company has product offerings in several segments that allow consumers to engage in socially distant and relatively pandemic-safe activities outdoors year round, the Company continues to promote and encourage the use of its products as outdoor recreational options for the public in light of the continued COVID-19 health crisis. Moreover, the Company continues to strategically evaluate and leverage the increased demand for many of its products by making disciplined investments for future, long-term growth in spite of the ongoing COVID-19 pandemic.

Highlights

Net sales of $165,667 for the first quarter of fiscal 2021 increased $37,613, or 29%, from the same period in the prior year, reflecting increased sales volumes across all businesses, except Diving, mainly attributable to increased participation in outdoor recreation activities as a result of social distancing and other indoor activity restrictions related to the COVID-19 pandemic. Additionally, we have seen our customers replenish their inventory levels of our products to meet expected demand for the Fiscal 2021 warm-weather outdoor recreational season. This sales volume increase was the primary driver of the increase of $16,756 in operating profit over the prior year quarter.

Seasonality

The Company’s business is seasonal in nature. The first fiscal quarter traditionally falls prior to the Company’s primary selling season for its warm-weather outdoor recreation products.  The table below sets forth a historical view of the Company’s seasonality during the last three fiscal years. See “Coronavirus (COVID-19)” above for additional information of the impact of COVID-19 on changes to the Company’s seasonality for fiscal 2020 which changes may continue to evolve in fiscal 2021.

	Fiscal Year
	2020				2019				2018
Quarter Ended	Net Sales		Operating Profit		Net Sales		Operating Profit		Net Sales		Operating Profit
December	22	%	10	%	19	%	9	%	21	%	11	%
March	27	%	45	%	32	%	43	%	31	%	41	%
June	23	%	17	%	31	%	43	%	31	%	51	%
September	28	%	28	%	18	%	5	%	17	%	-3	%
	100	%	100	%	100	%	100	%	100	%	100	%

Results of Operations

The Company’s net sales and operating profit (loss) by business segment for the periods shown below were as follows:

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	Three Months Ended
	January 1, 2021		December 27, 2019
Net sales:
Fishing	$	126,999	$	99,278
Camping	12,194		7,514
Watercraft Recreation	12,443		4,809
Diving	14,093		16,459
Other / Eliminations	(62)		(6)
Total	$	165,667	$	128,054
Operating profit (loss):
Fishing	$	27,763	$	15,018
Camping	2,808		66
Watercraft Recreation	1,069		(1,563)
Diving	(341)		205
Other / Eliminations	(7,742)		(6,925)
Total	$	23,557	$	6,801

See “Note 16 – Segments of Business” of the notes to the accompanying Condensed Consolidated Financial Statements for the definition of segment net sales and operating profit.

Net Sales

Consolidated net sales for the three months ended January 1, 2021 were $165,667, an increase of $37,613, or 29%, compared to $128,054 for the three months ended December 27, 2019. Foreign currency translation had a favorable impact of less than 1% on current year first quarter net sales compared to the prior year's first quarter net sales.

Net sales for the three months ended January 1, 2021 for the Fishing business were $126,999, an increase of $27,721, or 28%, from $99,278 during the first fiscal quarter of the prior year. The increase over the prior year quarter was driven by increased participation in outdoor recreation, principally as a result of the effect of COVID-19 on consumer recreation and leisure choices, resulting in higher demand across all product lines in the current year quarter.

Net sales for the Camping business were $12,194 for the first quarter of the current fiscal year, an increase of $4,680, or 62%, from the prior year net sales during the same period of $7,514. Increased sales of consumer tents, commercial tents and Jetboil products as a result of increased participation in outdoor recreation activities drove the increase.

Net sales for the first quarter of fiscal 2021 for the Watercraft Recreation business were $12,443, an increase of $7,634, or 159%, compared to $4,809 in the prior year same period. New product success and increased demand throughout the quarter drove the overall increase over the prior year quarter.

As noted above, as consumers took on greater interest in outdoor activities due to the COVID-19 pandemic, demand for many of our outdoor recreation products in our fishing, camping and watercraft recreation segments increased beyond the normal seasonal selling period. This resulted in our inventory levels, as well as the inventory levels for many of our customers, being depleted, which subsequently resulted in continued strong demand for our customers to fill their pipeline and stock inventory of our products in these three business segments in anticipation of the 2021 warm-weather recreational season. All of these actions resulted in strong demand for our products in these segments which generated the favorable quarter over quarter sales comparison.

Net sales for Diving, our most global business, were $14,093 for the three months ended January 1, 2021 versus $16,459 for the three months ended December 27, 2019, a decrease of $2,366, or 14%.  The decrease is largely due to the effects of COVID-19 on demand as a result of the continued closure of destination travel locations and lower tourism activities, which more than offset a favorable foreign currency translation impact on sales in this segment of approximately 4% versus the prior year quarter. Due to the timing of the COVID-19 pandemic upon our business, our results for the prior year first quarter were not impacted by COVID-19.

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Cost of Sales

Cost of sales for the three months ended January 1, 2021 was $90,637 compared to $74,442 for the three months ended December 27, 2019.  The increase year over year was driven primarily by increases in variable costs due to the higher sales volume in the current year quarter over the prior year quarter.

Gross Profit Margin

For the three months ended January 1, 2021, gross profit as a percentage of net sales was 45.3% compared to 41.9% in the three month period ended December 27, 2019. The improvement year over year was due primarily to product mix and increased efficiencies between periods, which more than offset $700 of higher tariff costs year over year.

At current expected rates, the Company anticipates an aggregate negative impact of Section 301 tariffs on China sourced goods, net of mitigation actions, on the Company's full fiscal 2021 gross profit of approximately $7 million, compared to approximately $3.5 million during the full previous fiscal year. The expiration of tariff exclusions that the Company secured in prior periods, combined with the application of new tariffs on a broader assortment of goods, is driving the expected year over year increase in tariff costs.

Operating Expenses

Operating expenses were $51,473 for the three months ended January 1, 2021 compared to $46,811 for the three months ended December 27, 2019.  The increase of $4,662 was primarily due to the impact of higher sales and sales volume driven expenses, as well as higher deferred compensation expense between quarters. Favorable market conditions on the Company's deferred compensation plan assets resulted in approximately $1,400 of higher deferred compensation expense in the current year quarter as compared to the prior year quarter, which was entirely offset by a gain in Other Income, net related to marking these deferred compensation plan assets to market.

Operating Profit

Operating profit on a consolidated basis for the three month period ended January 1, 2021 was $23,557 compared to an operating profit of $6,801 in the first quarter of the prior fiscal year.   Higher sales volumes and the other factors discussed above were the primary drivers of the increase in operating profit between quarters.

Interest

For the three months ended January 1, 2021, interest expense was $32 compared to $35 in the three months ended December 27, 2019. Interest income for the three month periods ended January 1, 2021 and December 27, 2019 was $82 and $655, respectively. The decrease in interest income year over year was mainly driven by the decrease in interest rates in fiscal 2021 versus the corresponding period of fiscal 2020.

Other Income, net

Other income was $2,404 for the three months ended January 1, 2021 compared to $1,168 in the prior year period.  Investment gains and earnings on the assets related to the Company’s non-qualified deferred compensation plan were $2,737 in the three month period ended January 1, 2021 compared to $1,324 in the three month period ended December 27, 2019. The increase year over year in the investment value of these assets was offset by the deferred compensation expense included in the Company's Operating expenses during the same periods. For the three months ended January 1, 2021, foreign currency exchange losses were $96 compared to $33 for the three months ended December 27, 2019. 

Income Tax Expense

The Company’s provision for income taxes is based upon estimated annual effective tax rates in the tax jurisdictions in which the Company operates.  The effective tax rate for the three month period ended January 1, 2021 was 23.7% compared to 25.1% in the corresponding period of the prior year. The key factor impacting the effective tax rate for the three months ended January 1, 2021 was a current period income tax benefit of an intra-entity transfer of an asset other than inventory.

Net Income

Net income for the three months ended January 1, 2021 was $19,847, or $1.96 per diluted common class A and B share, compared to net income of $6,430, or $0.64 per diluted common class A and B share, for the first quarter of the prior fiscal

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year. The increase in net income between quarters was driven by the increased sales demand for many of the Company’s products between quarters and the other factors described above.

Liquidity and Financial Condition

Cash and cash equivalents totaled $195,923 as of January 1, 2021, compared to cash and cash equivalents of $138,257 as of December 27, 2019.  The increase in cash year over year was due primarily to increased operating profits earned over the prior year quarter. The Company’s debt to total capitalization ratio was 0% as of January 1, 2021 and December 27, 2019.  The Company’s total debt balance was $0 as of each of January 1, 2021 and December 27, 2019.  See “Note 11 – Indebtedness” in the notes to the Company’s accompanying condensed consolidated financial statements for further discussion.

Accounts receivable, net of allowance for doubtful accounts, were $97,386 as of January 1, 2021, an increase of $19,137 compared to $78,249 as of December 27, 2019.  The increase is consistent with increased sales volumes year over year. Inventories were $114,849 as of January 1, 2021, an increase of $10,964, compared to $103,885 as of December 27, 2019. The increase over the prior year period is due to increased raw material and other component purchases in an effort to meet increased demand for products in the current year period. Accounts payable were $44,908 at January 1, 2021 compared to $35,384 as of December 27, 2019, which increase corresponded with the increase in inventory balances between quarters.

The Company’s cash flows from operating, investing and financing activities, as presented in the Company’s accompanying Condensed Consolidated Statements of Cash Flows, are summarized in the following table:

	Three months ended
(thousands)	January 1, 2021		December 27, 2019
Cash provided by (used for):
Operating activities	$	(11,238)	$	(29,088)
Investing activities	(4,388)		(3,307)
Financing activities	(2,589)		(2,149)
Effect of foreign currency rate changes on cash	1,701		419
Decrease in cash and cash equivalents	$	(16,514)	$	(34,125)

Operating Activities

Cash used for operations totaled $11,238 for the three months ended January 1, 2021 compared to $29,088 during the corresponding period of the prior fiscal year.  The decrease in cash used for operations over the prior year three month period was due primarily to increased net income between periods, as well as changes in working capital balances between quarters. Depreciation and amortization charges were $3,493 for the three month period ended January 1, 2021 compared to $3,432 for the corresponding period of the prior year. 

Investing Activities

Cash used for investing activities totaled $4,388 for the three months ended January 1, 2021 compared to cash used for investing activities of $3,307 for the corresponding period of the prior fiscal year.  Cash usage for capital expenditures totaled $4,390 for the current year three month period and $3,307 for the prior year period.  Any additional capital expenditures in fiscal 2021 are expected to be funded by working capital.

Financing Activities

Cash used for financing activities totaled $2,589 for the three months ended January 1, 2021 compared to $2,149 for the three month period ended December 27, 2019 and represents the payment of dividends and purchase of treasury stock. The Company had no debt during either quarter ended January 1, 2021 and December 27, 2019. See Note 11 "Indebtedness" to the accompanying Condensed Consolidated Financial Statements for additional information on our credit facilities.

As of January 1, 2021 the Company held approximately $48,609 of cash and cash equivalents in bank accounts in foreign taxing jurisdictions.

Contractual Obligations and Off Balance Sheet Arrangements

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The Company has contractual obligations and commitments to make future payments including under operating leases and open purchase orders.  The following schedule details these significant contractual obligations existing at January 1, 2021.

	Total		Less than 1 year		2-3 years		4-5 years		After 5 years
Operating lease obligations	$	46,248	$	6,508	$	9,935	$	8,293	$	21,512
Open purchase orders	134,066		134,066		—		—		—
Contractually obligated interest payments	211		84		127		—		—
Total contractual obligations	$	180,525	$	140,658	$	10,062	$	8,293	$	21,512

The Company utilizes letters of credit primarily as security for the payment of future claims under its workers compensation insurance.  Letters of credit outstanding were approximately $181 and $181 as of January 1, 2021 and December 27, 2019, respectively.

The Company anticipates making contributions of $128 to its defined benefit pension plans during the remainder of fiscal 2021.

The Company has no other off-balance sheet arrangements.

Critical Accounting Policies and Estimates

The Company’s critical accounting policies and estimates are identified in the Company’s Annual Report on Form 10-K for the fiscal year ending October 2, 2020 in Management’s Discussion and Analysis of Financial Condition and Results of Operations under the heading “Critical Accounting Estimates”, which was filed with the Securities and Exchange Commission on December 11, 2020. There were no significant changes to the Company’s critical accounting policies and estimates during the three months ended January 1, 2021.

Item 3.    Quantitative and Qualitative Disclosures about Market Risk

Except as noted below with respect to the COVID-19 outbreak, the Company’s exposure to market risk is limited to fluctuations in raw material commodity prices, interest rate fluctuations on borrowings under our unsecured credit facilities and foreign currency exchange rate risk associated with our foreign operations.  The Company does not utilize financial instruments for trading purposes.

Coronavirus outbreak

As disclosed in our prior filings with the Securities and Exchange Commission and elsewhere herein, in December 2019, a new strain of coronavirus ("COVID-19"), began to spread globally, leaving no region or part of the world unaffected by the pandemic it has created. Governments and health authorities have been taking, and continue to take, measures to prevent the spread of this virus, and have approved the use of vaccines to help curb the spread of this virus, but it is presently unknown to what extent the vaccines and these other actions will be successful or the potential timing of completion of these measures and their outcome and impact on the Company's business in the future. If COVID-19 is not contained, among other things, the ability of the Company’s suppliers to manufacture and deliver the products that it sells to the Company (at the quantities and pricing demanded by the Company), the ability of the Company to manufacture and deliver its products to its customers, the Company's ability to display its products at trade shows and similar events, the Company's ability to conduct meetings with its customers and prospective customers, and, if a significant number of its employees at a particular facility or location were to contract coronavirus, the Company’s ability to conduct its day-to-day operations could be adversely impacted. The continued financial impact of the coronavirus pandemic on the Company (including with respect to the continued heightened demand for the Company’s outdoor recreation products) will depend on future developments and cannot be reasonably predicted or estimated at this time, but could materially and adversely affect its results for an unknown but possibly extended period. See the section "Risk Factors" identified in Part I, Item 1A in our Form 10-K filed with the Securities and Exchange Commission on December 11, 2020 for more information.

Foreign Exchange Risk

The Company has significant foreign operations, for which the functional currencies are denominated primarily in euros, Swiss francs, Hong Kong dollars, and Canadian dollars. As the values of the currencies of the foreign countries in which the Company

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has operations increase or decrease relative to the U.S. dollar, the sales, expenses, profits, losses, assets and liabilities of the Company’s foreign operations, as reported in the Company’s consolidated financial statements, increase or decrease, accordingly. Approximately 10% of the Company’s revenues for the three month period ended January 1, 2021 were denominated in currencies other than the U.S. dollar. Approximately 4% were denominated in euros, approximately 4% in Canadian dollars and approximately 1% in Hong Kong dollars, with the remaining revenues denominated in various other foreign currencies. Changes in foreign currency exchange rates can cause unexpected financial losses or cash flow needs.  The Company may mitigate a portion of the fluctuations in certain foreign currencies through the use of foreign currency forward contracts.  Foreign currency forward contracts enable the Company to lock in the foreign currency exchange rate to be paid or received for a fixed amount of currency at a specified date in the future. The Company may use such foreign currency forward contracts to mitigate the risk associated with changes in foreign currency exchange rates on financial instruments and known commitments, including commitments for inventory purchases, denominated in foreign currencies. As of January 1, 2021 and December 27, 2019, the Company held no foreign currency forward contracts.

Interest Rate Risk

The Company operates in a seasonal business and experiences significant fluctuations in operating cash flow as working capital needs increase in advance of the Company’s primary selling and cash generation season, and decline as accounts receivable are collected and cash is accumulated or debt is repaid.  The Company is subject to interest rate risk on its seasonal working capital needs if such needs are funded with short term floating rate debt.

Commodities

Certain components used in the Company’s products are exposed to commodity price changes.  The Company manages this risk through instruments such as purchase orders and non-cancelable supply contracts.  Primary commodity price exposures include costs associated with metals, resins and packaging materials.

Impact of Inflation

The Company anticipates that changing costs of basic raw materials may impact future operating costs and, accordingly, the prices of its products.  The Company is involved in continuing programs to mitigate the impact of cost increases through changes in product design and identification of sourcing and manufacturing efficiencies.  Price increases and, in certain situations, price decreases are implemented for individual products, when appropriate.

The Company’s results of operations and financial condition are presented based on historical cost.  The Company does not believe that inflation has significantly affected its results of operations.

Supply Chain Sourcing Risk

As described elsewhere herein, the COVID-19 pandemic has disrupted the normal seasonal selling patterns for the Company’s warm-weather outdoor recreation products. As stay at home restrictions were lifted, the Company has seen an increase in demand for its products that has continued into the fiscal 2021 first quarter. This higher than normal level of demand may place strain on the Company’s supply chain, which may result in limited availability of key raw materials and components that may ultimately result in delays in fulfilling orders or higher purchase prices (including increased expediting costs) to get the raw material and other components needed for the Company to fulfill orders and meet demand. The Company is monitoring this risk and planning for alternative sources of supply of critical components.

Item 4.    Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in the Company’s reports filed or submitted under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that the information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. As of the end of the period covered by this report, the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on this evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that, as of the end of such period, the Company’s disclosure controls and procedures were effective at reaching a level of reasonable assurance. It should

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be noted that in designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost benefit relationship of possible controls and procedures. The Company has designed its disclosure controls and procedures to reach a level of reasonable assurance of achieving the desired control objectives.

There were no changes in the Company’s internal control over financial reporting (as defined in Rules 13a‑15(f) and 15d‑15(f) under the Exchange Act) that occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II    OTHER INFORMATION

Item 1.    Legal Proceedings

In the normal course of business, the Company may be involved in various legal proceedings from time to time.  We do not believe we are currently involved in any claim or action the ultimate disposition of which would have a material adverse effect on our financial statements.

Item 1A. Risk Factors

The following risk factor is in addition to the risk factors previously disclosed in our annual report on Form 10-K as filed with the Securities and Exchange Commission on December 11, 2020. The risk factor set forth below should be read in conjunction with the risk factors section and the Management's Discussion and Analysis section included in our annual report on Form 10-K as filed with the Securities and Exchange Commission on December 11, 2020.

Our stock price is volatile and our shareholders may not be able to resell shares of Class A Common Stock at or above the price they paid.

The trading price of our Class A Common Stock is highly volatile and could be subject to wide fluctuations in response to various factors, some of which are beyond our control. These factors include those discussed in this Report, those discussed under the “Risk Factors” section of our 2020 Annual Report on Form 10-K filed with the Securities and Exchange Commission on December 11, 2020 and others such as:

•announcements relating to our earnings trends or with respect to any cost-cutting actions or other strategic transactions involving Johnson Outdoors;

•announcements relating to product development efforts of Johnson Outdoors or competitors;

•announcements relating to the receipt, modification or termination of customer or supplier contracts, including with respect to any government contracts or grants;

•prevailing economic conditions;

•business disruptions caused by weather events, pandemics, or other natural disasters;

•disputes concerning Johnson Outdoors's or its competitors' intellectual property or other proprietary rights;

•sales of our Class A Common Stock by our executive officers and directors or our significant shareholders in the future;

•the lack of an active, liquid, and orderly market in our Class A Common Stock;

•fluctuations in our quarterly operating results; and

•the issuance of new or change securities analysts' reports or recommendations regarding the shares of our Class A Common Stock

In addition, the stock markets in general, and the markets for equity securities in companies principally operating in the outdoor leisure or recreational product markets, have experienced periods of high volatility that have been often unrelated to the operating performance of the issuer. These broad market fluctuations may adversely affect the trading price or liquidity of our Class A Common Stock.

Except as noted above, there have been no other material changes to the risk factors disclosed in our Form 10-K as filed with the Securities and Exchange Commission on December 11, 2020.

Item 6.    Exhibits

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See Exhibit Index to this Form 10-Q report.

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 thereunto duly authorized.

	JOHNSON OUTDOORS INC.
Signatures Dated: February 5, 2021
	/s/ Helen P. Johnson-Leipold
	Helen P. Johnson-Leipold
	Chairman and Chief Executive Officer
	(Principal Executive Officer)
	/s/ David W. Johnson
	David W. Johnson
	Vice President and Chief Financial Officer
	(Principal Financial and Accounting Officer)

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Exhibit Index to Quarterly Report on Form 10-Q

Exhibit Number	Description
3.1	Articles of Incorporation of the Company as amended through February 17, 2000. (Filed as Exhibit 3.1(a) to the Company’s Form 10-Q for the quarter ended March 31, 2000 and incorporated herein by reference.)
3.2	Bylaws of the Company as amended and restated through December 6, 2010. (Filed as Exhibit 3.2 to the Company’s Form 10-K for the year ended October 1, 2010 and incorporated herein by reference.)
31.1	Certification by the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification by the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32(1)	Certification of Periodic Financial Report by the Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101	The following materials from Johnson Outdoors Inc.’s Quarterly Report on Form 10-Q for the fiscal quarter ended January 1, 2021 formatted in XBRL (eXtensible Business Reporting Language) and furnished electronically herewith: (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Operations; (iii) Condensed Consolidated Statements of Comprehensive Income; (iv) Condensed Consolidated Statements of Cash Flows; (v) Condensed Consolidated Statements of Shareholders' Equity and (vi) Notes to Condensed Consolidated Financial Statements. XBRL Instance Document – the XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended January 1, 2021, formatted in Inline XBRL (included in Exhibit 101).

(1) This certification is not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

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EX-31.1

Exhibit 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the

Securities Exchange Act of 1934

I, Helen P. Johnson-Leipold, certify that:

1) I have reviewed this Quarterly Report on Form 10-Q of Johnson Outdoors Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 5, 2021	/s/ Helen P. Johnson-Leipold
		Helen P. Johnson-Leipold
		Chairman and Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act and Rule 13a-14(a) or 15d-14(a) under the

Securities Exchange Act of 1934

I, David W. Johnson, certify that:

1) I have reviewed this Quarterly Report on Form 10-Q of Johnson Outdoors Inc.;

2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	February 5, 2021	/s/ David W. Johnson
		David W. Johnson
		Vice President and Chief Financial Officer
		Treasurer

EX-32

Exhibit 32

Written Statement of the Chairman and Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350

Solely for the purposes of complying with 18 U.S.C. Section 1350, I, the undersigned Chairman and Chief Executive Officer of Johnson Outdoors Inc. (the “Company”), hereby certify that the Quarterly Report on Form 10-Q of the Company for the quarter ended January 1, 2021 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Helen P. Johnson-Leipold

Helen P. Johnson-Leipold

Chairman and Chief Executive Officer

February 5, 2021

Written Statement of the Vice President and Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350

Solely for the purposes of complying with 18 U.S.C. Section 1350, I, the undersigned Vice President and Chief Financial Officer of Johnson Outdoors Inc. (the “Company”), hereby certify that the Quarterly Report on Form 10-Q of the Company for the quarter ended January 1, 2021 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ David W. Johnson

David W. Johnson

Vice President and Chief Financial Officer

Treasurer

February 5, 2021

The above certifications are made solely for the purpose of 18 U.S.C. Section 1350, subject to the knowledge standard contained therein, and not for any other purpose.

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Cover Page - shares	3 Months Ended
	Jan. 01, 2021	Jan. 29, 2021
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jan. 01, 2021
Document Transition Report	false
Entity File Number	0-16255
Entity Registrant Name	JOHNSON OUTDOORS INC.
Entity Incorporation, State or Country Code	WI
Entity Tax Identification Number	39-1536083
Entity Address, Address Line One	555 Main Street
Entity Address, City or Town	Racine
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53403
City Area Code	262
Local Phone Number	631-6600
Title of 12(b) Security	Class A Common Stock, $.05 par value per share
Trading Symbol	JOUT
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Amendment Flag	false
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2021
Entity Central Index Key	0000788329
Current Fiscal Year End Date	--10-01
Class A
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		8,900,608
Class B
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		1,211,564

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Net sales	$ 165,667	$ 128,054
Cost of sales	90,637	74,442
Gross profit	75,030	53,612
Operating expenses:
Marketing and selling	32,533	29,305
Administrative management, finance and information systems	12,891	11,975
Research and development	6,049	5,531
Total operating expenses	51,473	46,811
Operating profit	23,557	6,801
Interest income	(82)	(655)
Interest expense	32	35
Other income, net	(2,404)	(1,168)
Profit before income taxes	26,011	8,589
Income tax expense	6,164	2,159
Net income	$ 19,847	$ 6,430
Weighted average common shares - Basic:
Participating securities (shares)	39	27
Weighted average common shares - Dilutive (shares)	10,091	10,039
Class A
Weighted average common shares - Basic:
Weighted average common shares - Basic (shares)	8,840	8,800
Net income per common share - Basic:
Net income per common share - Basic (USD per share)	$ 1.99	$ 0.65
Net income per common share - Diluted:
Net income per common share - Diluted (USD per share)	$ 1.96	$ 0.64
Class B
Weighted average common shares - Basic:
Weighted average common shares - Basic (shares)	1,212	1,212
Net income per common share - Basic:
Net income per common share - Basic (USD per share)	$ 1.81	$ 0.59
Net income per common share - Diluted:
Net income per common share - Diluted (USD per share)	$ 1.96	$ 0.64

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Statement of Comprehensive Income [Abstract]
Net income	$ 19,847	$ 6,430
Other comprehensive income:
Foreign currency translation	2,442	700
Defined benefit pension plan:
Change in pension plans, net of tax of $34 and $21, respectively	101	61
Total other comprehensive income	2,543	761
Total comprehensive income	$ 22,390	$ 7,191

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Statement of Comprehensive Income [Abstract]
Pension plans, unrecognized gain, tax	$ 34	$ 21

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CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Current assets:
Cash and cash equivalents	$ 195,923	$ 212,437	$ 138,257
Accounts receivable, net	97,386	67,292	78,249
Inventories	114,849	97,437	103,885
Other current assets	9,098	11,372	9,735
Total current assets	417,256	388,538	330,126
Property, plant and equipment, net of accumulated depreciation of $160,822, $156,541 and $146,453, respectively	63,657	63,037	59,629
Right of use assets	38,784	40,666	40,302
Deferred income taxes	10,850	10,679	11,456
Goodwill	11,219	11,184	11,193
Other intangible assets, net	8,911	9,052	11,128
Other assets	26,504	22,870	22,289
Total assets	577,181	546,026	486,123
Current liabilities:
Accounts payable	44,908	37,327	35,384
Current lease liability	6,411	6,587	5,835
Accrued liabilities:
Salaries, wages and benefits	16,080	23,275	13,767
Accrued warranty	11,980	10,849	10,443
Income taxes payable	10,724	6,681	9,598
Accrued discounts and returns	8,648	5,113	8,146
Accrued customer programs	5,508	4,426	3,819
Other	9,029	11,349	8,269
Total current liabilities	113,288	105,607	95,261
Non-current lease liability	33,260	34,931	35,133
Deferred income taxes	1,477	1,418	1,657
Retirement benefits	801	853	1,001
Deferred compensation liability	25,033	21,585	21,009
Other liabilities	4,710	3,532	1,823
Total liabilities	178,569	167,926	155,884
Common stock:
Capital in excess of par value	79,379	78,668	76,523
Retained earnings	314,184	296,431	253,114
Accumulated other comprehensive income	7,260	4,717	2,319
Treasury stock at cost, shares of Class A common stock: 41,977, 36,316 and 36,354, respectively	(2,715)	(2,220)	(2,221)
Total shareholders’ equity	398,612	378,100	330,239
Total liabilities and shareholders’ equity	577,181	546,026	486,123
Class A
Common stock:
Shares issued and outstanding	443	443	443
Class B
Common stock:
Shares issued and outstanding	$ 61	$ 61	$ 61

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CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) $ in Thousands	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Accumulated depreciation	$ 160,822	$ 156,541	$ 146,453
Treasury stock (in shares)	41,977	36,316	36,354
Class A
Common stock, issued (in shares)	8,900,608	8,873,235	8,858,611
Common stock, shares outstanding (in shares)	8,900,608	8,873,235	8,858,611
Class B
Common stock, issued (in shares)	1,211,564	1,211,564	1,211,602
Common stock, shares outstanding (in shares)	1,211,564	1,211,564	1,211,602

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (unaudited) - USD ($) $ in Thousands	Total	Common Stock	Capital in Excess of Par Value	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock
Balance, beginning of period at Sep. 27, 2019		10,045,771
Balance, beginning of period at Sep. 27, 2019		$ 504	$ 75,856	$ 248,377	$ 1,558	$ (1,761)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Total reclassifications for the period	$ 6,430			6,430
Dividends declared				(1,693)
Award of non-vested shares ( in shares)		31,571
Stock-based compensation			667
Currency translation adjustment	700				700
Change in pension plans, net of tax	61				61
Purchase of treasury stock at cost (shares)		(7,129)
Purchase of treasury stock at cost						(460)
Balance, end of period at Dec. 27, 2019		10,070,213
Balance, end of period at Dec. 27, 2019	330,239	$ 504	76,523	253,114	2,319	(2,221)
Balance, beginning of period at Oct. 02, 2020		10,084,799
Balance, beginning of period at Oct. 02, 2020	378,100	$ 504	78,668	296,431	4,717	(2,220)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Total reclassifications for the period	19,847			19,847
Dividends declared				(2,094)
Award of non-vested shares ( in shares)		33,034
Stock-based compensation			711
Currency translation adjustment	2,442				2,442
Change in pension plans, net of tax	101				101
Purchase of treasury stock at cost (shares)		(5,661)
Purchase of treasury stock at cost						(495)
Balance, end of period at Jan. 01, 2021		10,112,172
Balance, end of period at Jan. 01, 2021	$ 398,612	$ 504	$ 79,379	$ 314,184	$ 7,260	$ (2,715)

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (unaudited) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Statement of Stockholders' Equity [Abstract]
Change in pension plans, tax benefit (expense)	$ 34	$ 21

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
CASH USED FOR OPERATING ACTIVITIES
Total reclassifications for the period	$ 19,847	$ 6,430
Adjustments to reconcile net income to net cash used for operating activities:
Depreciation	3,349	3,176
Amortization of intangible assets	144	256
Amortization of deferred financing costs	7	7
Stock based compensation	711	667
Deferred income taxes	(146)	0
Change in operating assets and liabilities:
Accounts receivable, net	(29,693)	(33,616)
Inventories, net	(16,627)	(9,298)
Accounts payable and accrued liabilities	7,905	2,090
Other current assets	2,335	1,619
Other non-current assets	4,018	0
Other long-term liabilities	(2,818)	(412)
Other, net	(270)	(7)
CASH USED FOR OPERATING ACTIVITIES	(11,238)	(29,088)
CASH USED FOR INVESTING ACTIVITIES
Proceeds from sale of productive assets	2	0
Capital expenditures	(4,390)	(3,307)
CASH USED FOR INVESTING ACTIVITIES	(4,388)	(3,307)
CASH USED FOR FINANCING ACTIVITIES
Dividends paid	(2,094)	(1,689)
Purchases of treasury stock	(495)	(460)
CASH USED FOR FINANCING ACTIVITIES	(2,589)	(2,149)
Effect of foreign currency rate changes on cash	1,701	419
Decrease in cash and cash equivalents	(16,514)	(34,125)
CASH AND CASH EQUIVALENTS
Beginning of period	212,437	172,382
End of period	195,923	138,257
Supplemental Disclosure:
Cash paid for taxes	103	123
Cash paid for interest	$ 30	$ 30

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BASIS OF PRESENTATION

3 Months Ended

Jan. 01, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

BASIS OF PRESENTATION

BASIS OF PRESENTATION

The condensed consolidated financial statements included herein are unaudited. In the opinion of management, these statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly the financial position of Johnson Outdoors Inc. and subsidiaries (collectively, the “Company”) as of January 1, 2021 and December 27, 2019, and their results of operations for the three month periods then ended and cash flows for the three month periods then ended. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 2, 2020 which was filed with the Securities and Exchange Commission on December 11, 2020.

Due to seasonal variations and other factors, some of which are described herein, including related to the coronavirus (COVID-19) outbreak and resulting pandemic, the results of operations for the three months ended January 1, 2021 are not necessarily indicative of the results to be expected for the Company’s full 2021 fiscal year.  See "Coronavirus (COVID-19) below and “Seasonality” and "Coronavirus (COVID-19)" in the Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere herein for additional information.

The Company considers all short-term investments in interest-bearing accounts and all securities and other instruments with an original maturity of three months or less, to be equivalent to cash. Cash equivalents are stated at cost which approximates market value.

All monetary amounts, other than share and per share amounts, are stated in thousands.

Coronavirus (COVID-19)

In March 2020, the World Health Organization recognized the current coronavirus (COVID-19) outbreak as a global pandemic. In response to the COVID-19 outbreak, the governments of many countries, states, cities and other geographic regions imposed varying degrees of restrictions on social and commercial activity, including imposing travel restrictions, issuing quarantine, shelter-in-place and stay at home orders and guidelines and related actions, mandating mask wearing, limiting business capacity and generally restricting freedom of movement, in order to promote social distancing and other similar programs all in an effort to slow the spread of the illness.

While some government mandates eased in the latter half of fiscal 2020, these mandates continued to emphasize social distancing measures to the general public. As a result, we saw increased participation in fishing, camping and watercraft recreation and related demand for our products, largely driven by consumer desire to engage in socially distant and safe activities in the great outdoors in the latter part of fiscal 2020, which continued into the first quarter of fiscal 2021. Nonetheless, the full extent to which the COVID-19 pandemic will impact our business, results of operations, and financial condition, including with respect to consumer buying patterns for the rest of our fiscal 2021, will depend on future developments, including any potential worsening or improvement of the pandemic, which are beyond our control and which remain highly uncertain and cannot be predicted. This includes, but is not limited to, the duration, spread, severity and impact of the COVID-19 pandemic, vaccine distribution and effectiveness, or future waves, increasing outbreaks or hot spots of the pandemic in our areas of operations or in key markets, the effects of the pandemic on our customers, consumers, suppliers and vendors and the remedial actions and stimulus measures adopted by federal, state and local governments in reaction to the pandemic. Further, the authorization of vaccines for COVID-19 by governments around the world, including the distribution of same, may further impact commercial activity and customer or consumer buying behavior, and the extent to which these developments will impact demand for, and participation in, outdoor recreation and related products is unknown. As the COVID-19 pandemic continues to impact various key regions of the world, even after it subsides, we may continue to experience adverse impacts to our business, including our supply chain, as a result of any economic recession that has occurred or may occur in the future. As a result, the Company cannot reasonably estimate the full impact of the COVID-19 pandemic on Company operations and profitability at this time as the situation is dynamic and constantly changing. We continue to monitor evolving economic and general business conditions stemming from the COVID-19 pandemic and the actual and potential impacts on our financial position, results of operations and cash flows.

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ACCOUNTS RECEIVABLE	3 Months Ended
	Jan. 01, 2021
Receivables [Abstract]
ACCOUNTS RECEIVABLE	ACCOUNTS RECEIVABLEAccounts receivable are stated net of allowances for doubtful accounts of $2,823, $2,697 and $3,062 as of January 1, 2021, October 2, 2020 and December 27, 2019, respectively. The increase in net accounts receivable to $97,386 as of January 1, 2021 from $67,292 as of October 2, 2020 is largely attributable to the impact of the COVID-19 pandemic on the buying patterns of the Company’s customers, which has shifted the seasonal nature of the Company’s business and has caused increases in sales volumes between periods. The determination of the allowance for doubtful accounts is based on a combination of factors. In circumstances where specific collection concerns about a receivable exist (including as a result of the impact of COVID-19), a reserve is established to value the affected account receivable at an amount the Company believes will be collected. For all other customers, the Company recognizes allowances for doubtful accounts based on historical experience of bad debts as a percent of accounts receivable outstanding for each business segment. Uncollectible accounts are written off against the allowance for doubtful accounts after collection efforts have been exhausted. The Company typically does not require collateral on its accounts receivable.

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EARNINGS PER SHARE (“EPS”)

3 Months Ended

Jan. 01, 2021

Earnings Per Share [Abstract]

EARNINGS PER SHARE (“EPS”)

EARNINGS PER SHARE (“EPS”)

Net income or loss per share of Class A common stock and Class B common stock is computed using the two-class method.  Grants of restricted stock which receive non-forfeitable dividends are classified as participating securities and are required to be included as part of the basic weighted average share calculation under the two-class method.

Holders of Class A common stock are entitled to cash dividends equal to 110% of all dividends declared and paid on each share of Class B common stock. The Company grants shares of unvested restricted stock in the form of Class A shares, which carry the same distribution rights as the Class A common stock described above.  As such, the undistributed earnings for each period are allocated to each class of common stock based on the proportionate share of the amount of cash dividends that each such class is entitled to receive.

Basic EPS

Basic net income or loss per share is computed by dividing net income or loss allocated to Class A common stock and Class B common stock by the weighted-average number of shares of Class A common stock and Class B common stock outstanding, respectively.  In periods with cumulative year to date net income and undistributed income, the undistributed income for each period is allocated to each class of common stock based on the proportionate share of the amount of cash dividends that each such class is entitled to receive.  In periods where there is a cumulative year to date net loss or no undistributed income because distributions through dividends exceed net income, Class B shares are treated as anti-dilutive and, therefore, net losses are allocated equally on a per share basis among all participating securities.

For the three month periods ended January 1, 2021 and December 27, 2019, basic income per share for the Class A and Class B shares has been presented using the two class method and reflects the allocation of undistributed income described above. 

Diluted EPS

Diluted net income per share is computed by dividing allocated net income by the weighted-average number of common shares outstanding, adjusted for the effect of dilutive stock options, restricted stock units (“stock units” or “units”) and non-vested restricted stock.  Anti-dilutive stock options, units and non-vested stock are excluded from the calculation of diluted EPS.  The computation of diluted net income per share of Class A common stock assumes that Class B common stock is converted into Class A common stock.  Therefore, diluted net income per share is the same for both Class A and Class B common shares.  In periods where the Company reports a net loss, the effect of anti-dilutive stock options and units is excluded and diluted loss per share is equal to basic loss per share for both classes of stock.

For the three month periods ended January 1, 2021 and December 27, 2019, diluted net income per share reflects the effect of dilutive stock units and assumes the conversion of Class B common stock into Class A common stock. 

Non-vested stock that could potentially dilute earnings per share in the future which were not included in the fully diluted computation because they would have been anti-dilutive totaled 40,647 and 40,312 for the three months ended January 1, 2021 and December 27, 2019, respectively. Stock units that could potentially dilute earnings per share in the future and which were not included in the fully diluted computation because they would have been anti-dilutive were 30,786 and 41,111 for the three month periods ended January 1, 2021 and December 27, 2019, respectively.

Dividends per share

Dividends per share for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

	Three Months Ended
	January 1, 2021		December 27, 2019
Dividends declared per common share:
Class A	$	0.21	$	0.17
Class B	$	0.19	$	0.15

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STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS

3 Months Ended

Jan. 01, 2021

Share-based Payment Arrangement [Abstract]

STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS

STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS

The Company’s current stock ownership plans allow for issuance of stock options to acquire shares of Class A common stock by key executives and non-employee directors. Current plans also allow for issuance of shares of restricted stock, restricted stock units or stock appreciation rights in lieu of stock options.

Under the Company’s 2012 Non-Employee Director Stock Ownership Plan and the 2020 Long-Term Incentive Plan (the only plans where shares currently remain available for future equity incentive awards) there were a total of 507,510 shares of the Company’s Class A common stock available for future grant to non-employee directors and key executives at January 1, 2021. Share awards previously made under the Company's 2010 Long-Term Stock Incentive Plan, which no longer allows for additional share grants, also remain outstanding.

Non-vested Stock

All shares of non-vested restricted stock awarded by the Company have been granted in the form of shares of Class A common stock at their fair market value on the date of grant and vest within one year from the date of grant for stock granted to directors and four years from the date of grant for stock granted to officers and employees.  The fair value at date of grant is based on the number of shares granted and the average of the Company’s high and low Class A common stock price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock price on the last preceding date on which the Company’s Class A shares traded.

A summary of non-vested stock activity for the three months ended January 1, 2021 related to the Company’s stock ownership plans is as follows:

	Shares	Weighted Average Grant Price
Non-vested stock at October 2, 2020	40,492	$	62.15
Non-vested stock grants	8,758	88.49
Restricted stock vested	(7,586)	43.12
Non-vested stock at January 1, 2021	41,664	71.15

Non-vested stock grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of shares by tendering a portion of the vested shares back to the Company.  Shares tendered back to the Company were 2,341 and 4,054 during the three month periods ended January 1, 2021 and December 27, 2019, respectively.

Stock compensation expense, net of forfeitures, related to non-vested stock was $279 and $240 for the three month periods ended January 1, 2021 and December 27, 2019, respectively. Unrecognized compensation cost related to non-vested stock as of January 1, 2021 was $1,672, which amount will be amortized to expense through November 2024 or adjusted for changes in future estimated or actual forfeitures.

The fair value of restricted stock vested during the three month periods ended January 1, 2021 and December 27, 2019 was $658 and $839, respectively.

Restricted Stock Units

All restricted stock units (RSUs) awarded by the Company have been granted in the form of units payable in shares of Class A common stock upon vesting. The units are valued at the fair market value of a share of Class A common stock on the date of grant and vest within one year from the date of grant for RSUs granted to directors and three years from the date of grant for RSUs granted to employees.  The fair value at the date of grant is based on the number of units granted and the average of the Company’s high and low Class A common stock trading price on the date of grant or, if the Company’s Class A shares did not trade on the date of grant, the average of the Company’s high and low Class A common stock trading price on the last preceding date on which the Company’s Class A shares traded.

A summary of RSU activity for the three months ended January 1, 2021 follows:

	Number of RSUs	Weighted Average Grant Price
RSUs at October 2, 2020	67,821	$	68.34
RSUs granted	20,059	88.49
RSUs vested	(18,112)	43.49
RSUs at January 1, 2021	69,768	80.58

Stock compensation expense, net of forfeitures, related to RSUs was $432 and $420 for the three months ended January 1, 2021 and December 27, 2019, respectively. Unrecognized compensation cost related to non-vested RSUs as of January 1, 2021 was $3,050, which amount will be amortized to expense through September 2023 or adjusted for changes in future estimated or actual forfeitures.

RSU grantees may elect to reimburse the Company for withholding taxes due as a result of the vesting of units and issuance of unrestricted shares of Class A common stock by tendering a portion of such unrestricted shares back to the Company. Shares tendered back to the Company for this purpose were 3,320 and 3,075 during the three month periods ended January 1, 2021 and December 27, 2019, respectively.

The fair value of restricted stock units recognized as a tax deduction during the three month periods ended January 1, 2021 and December 27, 2019 was $2,148 and $1,426, respectively.

Compensation expense related to units earned by employees (as opposed to grants to outside directors) is based upon the attainment of certain Company financial goals related to cumulative net sales and cumulative operating profit over a three-year performance period. Awards are only paid if at least 80% of the target levels are met and maximum payouts are made if 120% or more of target levels are achieved. The payouts for achievement at the threshold levels of performance are equal to 50% of the target award amount. The payouts for achievement at maximum levels of performance are equal to 150% of the target award amount. To the extent earned, awards are issued in shares of Company Class A common stock after the end of the three-year performance period.

Employees’ Stock Purchase Plan

The Company’s shareholders have adopted the Johnson Outdoors Inc. 2009 Employees’ Stock Purchase Plan, which was most recently amended on March 2, 2017, and which provides for the issuance of shares of Class A common stock at a purchase price of not less than 85% of the fair market value of such shares on the date of grant or on the date of purchase, whichever is lower.

During the three month period ended January 1, 2021, the Company issued 0 shares of Class A common stock and recognized $0 of expense in connection with the Employees' Stock Purchase Plan. During the three month period ended December 27, 2019, the Company issued 0 shares of Class A common stock and recognized $7 of expense in connection with the Plan.

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PENSION PLANS

3 Months Ended

Jan. 01, 2021

Retirement Benefits [Abstract]

PENSION PLANS

PENSION PLANS

The Company has two non-contributory defined benefit pension plans covering certain of its U.S. employees. Retirement benefits are generally provided based on the employees’ years of service and average earnings. Normal retirement age is 65, with provisions for earlier retirement.

The Company made contributions of $43 and $44 to its pension plans for the three months ended January 1, 2021 and December 27, 2019, respectively.

During the first quarter of fiscal 2021, Company management commenced actions to terminate both of the pension plans. As part of the termination of these plans, all plan participants will have the option of taking a lump sum payment or receiving payout pursuant to an annuity contract. When the termination and related payouts occur, they are estimated to unfavorably impact net income by approximately $4 to $5 million.

The components of net periodic benefit cost related to Company sponsored defined benefit plans for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

	Three Months Ended
	January 1, 2021		December 27, 2019
Components of net periodic benefit cost:
Service cost	$	—	$	—
Interest on projected benefit obligation	233		276
Less estimated return on plan assets	160		214
Amortization of unrecognized losses (gains)	134		82
Net periodic benefit cost	$	207	$	144

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INCOME TAXES

3 Months Ended

Jan. 01, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

INCOME TAXES

For the three months ended January 1, 2021 and December 27, 2019, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

	Three Months Ended
(thousands, except tax rate data)	January 1, 2021			December 27, 2019
Profit before income taxes	$	26,011		$	8,589
Income tax expense	6,164			2,159
Effective income tax rate	23.7		%	25.1		%

The decrease in the effective tax rate for the three months ended January 1, 2021 compared to the prior year period is primarily due to a current period income tax benefit of an intra-entity transfer of an asset other than inventory.

The impact of the Company’s operations in jurisdictions where a valuation allowance is assessed is removed from the overall effective tax rate methodology and recorded directly based on year to date results for the year for which no tax expense or benefit can be recognized.  The significant tax jurisdictions that have a valuation allowance for the periods ended January 1, 2021 and December 27, 2019 were:

January 1, 2021	December 27, 2019
France	France
Indonesia	Indonesia
Switzerland	Switzerland

The Company regularly assesses the adequacy of its provisions for income tax contingencies in accordance with the applicable authoritative guidance on accounting for income taxes.  As a result, the Company may adjust the reserves for unrecognized tax benefits due to the impact of changes in its assumptions or as a result of new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities and lapses of statutes of limitation.  The Company’s 2021 fiscal year tax expense is anticipated to be unchanged related to uncertain income tax positions.

In accordance with its accounting policy, the Company recognizes accrued interest and penalties related to unrecognized benefits as a component of income tax expense.  The Company is projecting accrued interest of $300 related to uncertain income tax positions for the fiscal year ending October 1, 2021.

The Company files income tax returns, including returns for its subsidiaries, with federal, state, local and foreign taxing jurisdictions.   As of the date of this report, the following tax years remain open to examination by the respective significant tax jurisdictions:

Jurisdiction	Fiscal Years
United States	2017-2020
Canada	2016-2020
France	2017-2020
Germany	2017-2020
Italy	2018-2020
Switzerland	2010-2020

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INVENTORIES

3 Months Ended

Jan. 01, 2021

Inventory Disclosure [Abstract]

INVENTORIES

INVENTORIES

The Company values inventory at the lower of cost (determined using the first-in first-out method) or net realizable value. Inventories at the end of the respective periods consisted of the following:

	January 1, 2021		October 2, 2020		December 27, 2019
Raw materials	$	63,353	$	48,874	$	47,208
Work in process	38		39		463
Finished goods	51,458		48,524		56,214
	$	114,849	$	97,437	$	103,885

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GOODWILL

3 Months Ended

Jan. 01, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL

GOODWILL

The changes in goodwill during the three months ended January 1, 2021 and December 27, 2019 were as follows:

	January 1, 2021		December 27, 2019
Balance at beginning of period	$	11,184	$	11,186
Amount attributable to movements in foreign currency rates	35		7
Balance at end of period	$	11,219	$	11,193

The Company evaluates the carrying value of goodwill for a reporting unit on an annual basis or more frequently when events and circumstances warrant such an evaluation.  In conducting this analysis, the Company uses the income approach to compare the reporting unit's carrying value to its indicated fair value. Fair value is determined primarily by using a discounted cash flow methodology that requires considerable management judgment and long-term assumptions and is considered a Level 3 (unobservable) fair value determination in the fair value hierarchy (see Note 13) below.

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WARRANTIES

3 Months Ended

Jan. 01, 2021

Product Warranties Disclosures [Abstract]

WARRANTIES

WARRANTIES

The Company provides warranties on certain of its products as they are sold. The following table summarizes the Company’s warranty activity for the three months ended January 1, 2021 and December 27, 2019.

	January 1, 2021		December 27, 2019
Balance at beginning of period	$	10,849	$	9,190
Expense accruals for warranties issued during the period	3,177		3,335
Less current period warranty claims paid	2,046		2,082
Balance at end of period	$	11,980	$	10,443

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CONTINGENCIES	3 Months Ended
	Jan. 01, 2021
Commitments and Contingencies Disclosure [Abstract]
CONTINGENCIES	CONTINGENCIESThe Company is subject to various legal actions and proceedings in the normal course of business, including those related to commercial disputes, product liability, intellectual property and regulatory matters. The Company is insured against loss for certain of these matters. Although litigation is subject to many uncertainties and the ultimate exposure with respect to these matters cannot be ascertained, management does not believe the final outcome of any pending litigation will have a material adverse effect on the financial condition, results of operations, liquidity or cash flows of the Company.

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INDEBTEDNESS

3 Months Ended

Jan. 01, 2021

Debt Disclosure [Abstract]

INDEBTEDNESS

INDEBTEDNESS

The Company had no debt outstanding at January 1, 2021, October 2, 2020, or December 27, 2019.

Revolvers

The Company and certain of its subsidiaries have entered into an unsecured credit facility with PNC Bank National Association and Associated Bank, N.A. ("the Lending Group").  This credit facility consists of a $75 million Revolving Credit Facility among the Company, certain of the Company’s subsidiaries, PNC Bank National Association, as lender and as administrative agent, and the other lender named therein (the “Credit Agreement” or “Revolver”).  The Revolver has an expiration date of November 15, 2022 and provides for borrowing of up to an aggregate principal amount not to exceed $75,000 with a $50,000 accordion feature that gives the Company the option to increase the maximum financing availability (i.e., an aggregate borrowing amount of $125,000) subject to the conditions of the Credit Agreement and subject to the approval of the lenders.

The interest rate on the Revolver is based on LIBOR plus an applicable margin, which margin resets each quarter.  The applicable margin ranges from 1.00% to 1.75% and is dependent on the Company’s leverage ratio for the trailing twelve month period.  The interest rates on the Revolver at January 1, 2021 and December 27, 2019 were approximately 1.1% and 2.8%, respectively.

The Credit Agreement restricts the Company's ability to incur additional debt, includes maximum leverage ratio and minimum interest coverage ratio covenants and is unsecured.

Other Borrowings

The Company had no unsecured revolving credit facilities at its foreign subsidiaries as of January 1, 2021 or December 27, 2019.  The Company utilizes letters of credit primarily as security for the payment of future claims under its workers’ compensation insurance, which totaled approximately $181 and $181 as of January 1, 2021 and December 27, 2019, respectively.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

3 Months Ended

Jan. 01, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The following disclosures describe the Company’s objectives in using derivative instruments, the business purpose or context for using derivative instruments, and how the Company believes the use of derivative instruments helps achieve the stated objectives.  In addition, the following disclosures describe the effects of the Company’s use of derivative instruments and hedging activities on its financial statements.

Foreign Exchange Risk

The Company has significant foreign operations, for which the functional currencies are denominated primarily in euros, Swiss francs, Hong Kong dollars and Canadian dollars. As the values of the currencies of the foreign countries in which the Company has operations increase or decrease relative to the U.S. dollar, the sales, expenses, profits, losses, assets and liabilities of the Company’s foreign operations, as reported in the Company’s consolidated financial statements, increase or decrease, accordingly.  Approximately 10% of the Company’s revenues for the three month

period ended January 1, 2021 were denominated in currencies other than the U.S. dollar. Approximately 4% were denominated in euros, approximately 4% were denominated in Canadian dollars and approximately 1% were denominated in Hong Kong dollars, with the remaining revenues denominated in various other foreign currencies. Changes in foreign currency exchange rates can cause the Company to experience unexpected financial losses or cash flow needs.

The Company may mitigate a portion of the fluctuations in certain foreign currencies through the use of foreign currency forward contracts.  Foreign currency forward contracts enable the Company to lock in the foreign currency exchange rate to be paid or received for a fixed amount of currency at a specified date in the future. The Company may use such foreign currency forward contracts to mitigate the risk associated with changes in foreign currency exchange rates on financial instruments and known commitments, including commitments for inventory purchases, denominated in foreign currencies. As of January 1, 2021 and December 27, 2019, the Company held no foreign currency forward contracts.

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FAIR VALUE MEASUREMENTS

3 Months Ended

Jan. 01, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. A fair value hierarchy has been established based on three levels of inputs, of which the first two are considered observable and the last unobservable.

•Level 1 - Quoted prices in active markets for identical assets or liabilities. These are typically obtained from real-time quotes for transactions in active exchange markets involving identical assets or liabilities.

•Level 2 - Inputs, other than quoted prices included within Level 1, which are observable for the asset or liability, either directly or indirectly. These are typically obtained from readily-available pricing sources for comparable instruments.

•Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own assumptions of the data that market participants would use in pricing the asset or liability, based on the best information available in the circumstances.

The carrying amounts of cash, cash equivalents, short term investments, accounts receivable, and accounts payable approximated their fair values at January 1, 2021, October 2, 2020 and December 27, 2019 due to the short term maturities of these instruments. When indicators of impairment are present, the Company may be required to value certain long-lived assets such as property, plant, and equipment, and other intangibles at their fair value.

Valuation Techniques

Rabbi Trust Assets

Rabbi trust assets are classified as trading securities and are comprised of marketable debt and equity securities that are marked to fair value based on unadjusted quoted prices in active markets.  The rabbi trust assets are used to fund amounts the Company owes to certain officers and other employees under the Company’s non-qualified deferred compensation plan.  These assets are included in "Other assets" in the Company's Condensed Consolidated Balance Sheets, and the mark to market adjustments on the assets are recorded in “Other income, net” in the accompanying Condensed Consolidated Statements of Operations. The offsetting deferred compensation liability is also reported at fair value as "Deferred compensation liability" in the Company's accompanying Condensed Consolidated Balance Sheets. Changes in the liability are recorded in "Administrative management, finance and information systems" expense in the accompanying Condensed Consolidated Statements of Operations.

The following table summarizes the Company’s financial assets measured at fair value as of January 1, 2021:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	25,032	$	—	$	—	$	25,032

The following table summarizes the Company’s financial assets measured at fair value as of October 2, 2020:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	21,550	$	—	$	—	$	21,550

The following table summarizes the Company’s financial assets measured at fair value as of December 27, 2019:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	20,978	$	—	$	—	$	20,978

The effect of changes in the fair value of financial instruments on the accompanying Condensed Consolidated Statements of Operations for the three month periods ended January 1, 2021 and December 27, 2019 was:

		Three Months Ended
	Location of income loss recognized in Statement of Operations	January 1, 2021		December 27, 2019
Rabbi trust assets	Other income, net	$	2,596	$	1,192

There were no assets or liabilities measured at fair value on a non-recurring basis in periods subsequent to their initial recognition for either of the three month periods ended January 1, 2021 or December 27, 2019.

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NEW ACCOUNTING PRONOUNCEMENTS

3 Months Ended

Jan. 01, 2021

Accounting Standards Update and Change in Accounting Principle [Abstract]

NEW ACCOUNTING PRONOUNCEMENTS

NEW ACCOUNTING PRONOUNCEMENTS

    Recently adopted accounting pronouncements

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). In July 2018, the FASB also issued ASU 2018-10 Codification Improvements to Topic 842, Leases and ASU 2018-11 Leases (Topic 842) Targeted Improvements. In February 2019, the FASB also issued ASU 2019-01 Leases (Topic 842): Codification Improvements. This ASU and the updates to this ASU require organizations to recognize lease assets and lease liabilities on the balance sheet and to disclose key information about leasing arrangements. This guidance was effective for the Company in the first quarter of fiscal year 2020, and may be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements with certain practical expedients available. The Company adopted the provisions of these ASU's using the modified retrospective approach at the beginning of the first quarter of fiscal 2020, coinciding with the standard's effective date. The additional disclosures required by the ASU and its updates are included in Note 18 "Leases" of these Notes to the Condensed Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses (Topic 326)” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively Topic 326). Topic 326 requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This replaces the existing incurred loss model with an expected loss model and requires the use of forward-looking information to calculate credit loss estimates. This guidance was effective for the Company in the first quarter of fiscal year 2021, and must be adopted by applying a cumulative effect adjustment to retained earnings. The Company adopted the provisions of this ASU at the beginning of the first quarter of fiscal 2021, however the ASU did not have a significant impact on its financial statements, and therefore no adjustment to retained earnings was necessary.

    Recently issued accounting pronouncements

In August 2018, the FASB issued ASU 2018-14, Changes to the Disclosure Requirements for Defined Benefit Plans (Topic 715), which modifies the disclosure requirements for employers that sponsor defined pension or postretirement plans. The amendments in this guidance are effective for fiscal years ending after December 15, 2020, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures.

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes. ASU 2019-12 is intended to simplify accounting for income taxes. It removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted. The Company does not expect adoption of the new guidance to have a significant impact on its financial statements.

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REVENUES

3 Months Ended

Jan. 01, 2021

Revenue from Contract with Customer [Abstract]

REVENUES

REVENUES

Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The amount of consideration received can vary, primarily because of customer incentive or rebate arrangements. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled based on historical experience and projected market expectations. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. For all contracts with customers, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component as the period between the transfer of the promised goods and the customer's payment is expected to be one year or less. Sales are made on normal and customary short-term credit terms, generally ranging from 30 to 90 days, or upon delivery of point of sale transactions. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The Company enters into contractual arrangements with customers in the form of individual customer orders which specify the goods, quantity, pricing, and associated order terms. The Company does not have contracts which are satisfied over time. Due to the nature of these contracts, no significant judgment exists in relation to the identification of the customer contract, satisfaction of the performance obligation, or transaction price. The Company expenses incremental costs of obtaining a contract due to the short-term nature of the contracts.

Estimated costs of returns, allowances and discounts, based on historic experience, are accrued as a reduction to sales when revenue is recognized. The Company provides customers the right to return eligible products under certain circumstances. At January 1, 2021, the right to returns asset was $1,367 and the accrued returns liability was $3,621. At December 27, 2019, the right to returns asset was $1,112 and the accrued returns liability was $3,394. The Company also offers assurance-type warranties relating to its products sold to end customers that continue to be accounted for under ASC 460 Guarantees.

The Company generally accounts for shipping and handling activities as a fulfillment activity, consistent with the timing of revenue recognition; that is, when a customer takes control of the transferred goods. In the event that a customer were to take control of a product upon or after shipment, the Company has made an accounting policy election to treat such shipping and handling activities as a fulfillment cost. Shipping and handling fees billed to customers are included in "Net Sales," and shipping and handling costs are recognized within "Marketing and selling expenses" in the same period the related revenue is recognized.

The Company has a wide variety of seasonal, outdoor recreation products used primarily for fishing from a boat, diving, paddling, hiking and camping, that are sold to a variety of customers in multiple end markets. Nonetheless, the revenue recognition policies are similar among all the various products sold by the Company.

    See Note 16 for required disclosures of disaggregated revenue.

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SEGMENTS OF BUSINESS

3 Months Ended

Jan. 01, 2021

Segment Reporting [Abstract]

SEGMENTS OF BUSINESS

SEGMENTS OF BUSINESSThe Company conducts its worldwide operations through separate business segments, each of which represents major product lines. Operations are conducted in the United States and various foreign countries, primarily in Europe, Canada and the Pacific Basin.  During the three month periods ended January 1, 2021 and December 27, 2019, combined net sales to two customers of the Company's Fishing, Camping and Watercraft Recreation segments represented approximately $53,573 and $32,321, respectively, of the Company's consolidated revenues.

Net sales and operating profit include both sales to customers, as reported in the Company’s accompanying Condensed Consolidated Statements of Operations, and interunit transfers, which are priced to recover cost plus an appropriate profit margin. Total assets represent assets that are used in the Company’s operations in each business segment at the end of the periods presented.

A summary of the Company’s operations by business segment is presented below:

	Three Months Ended
	January 1, 2021		December 27, 2019		October 2, 2020
Net sales:
Fishing:
Unaffiliated customers	$	126,859	$	99,193
Interunit transfers	140		85
Camping:
Unaffiliated customers	12,185		7,505
Interunit transfers	9		9
Watercraft Recreation:
Unaffiliated customers	12,397		4,803
Interunit transfers	46		6
Diving
Unaffiliated customers	14,090		16,458
Interunit transfers	3		1
Other / Corporate	136		95
Eliminations	(198)		(101)
Total	$	165,667	$	128,054
Operating profit (loss):
Fishing	$	27,763	$	15,018
Camping	2,808		66
Watercraft Recreation	1,069		(1,563)
Diving	(341)		205
Other / Corporate	(7,742)		(6,925)
	$	23,557	$	6,801
Total assets (end of period):
Fishing	$	244,217	$	216,783	$	206,244
Camping	40,901		32,815		37,514
Watercraft Recreation	24,058		20,611		21,038
Diving	68,818		64,799		67,393
Other / Corporate	199,187		151,115		213,837
	$	577,181	$	486,123	$	546,026

1

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

3 Months Ended

Jan. 01, 2021

Equity [Abstract]

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended January 1, 2021 were as follows:

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at October 2, 2020	$	7,323	$	(2,606)	$	4,717
Other comprehensive income before reclassifications	2,442		—		2,442
Amounts reclassified from accumulated other comprehensive income	—		135		135
Tax effects	—		(34)		(34)
Balance at January 1, 2021	$	9,765	$	(2,505)	$	7,260

The changes in AOCI by component, net of tax, for the three months ended December 27, 2019 were as follows: 

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at September 27, 2019	$	4,790	$	(3,232)	$	1,558
Other comprehensive income before reclassifications	700		—		700
Amounts reclassified from accumulated other comprehensive income	—		82		82
Tax effects	—		(21)		(21)
Balance at December 27, 2019	$	5,490	$	(3,171)	$	2,319

    The reclassifications out of AOCI for the three months ended January 1, 2021 and December 27, 2019 were as follows: 

	Three Months Ended
	January 1, 2021		December 27, 2019		Statement of Operations Presentation
Unamortized loss on defined benefit pension plans:
Amortization of loss	$	135	$	82	Other income and expense
Tax effects	(34)		(21)		Income tax expense
Total reclassifications for the period	$	101	$	61

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LEASES

3 Months Ended

Jan. 01, 2021

Leases [Abstract]

LEASES

LEASES

    Adoption of Topic 842

At the beginning of fiscal year 2020, the Company adopted ASU 2016-02 and all subsequent ASUs that modified accounting standards Topic 842 using a modified retrospective adoption method, in which right-of-use ("ROU") assets and lease liabilities are recognized in the condensed consolidated balance sheets. Under the effective date transition method, financial results reported in periods prior to fiscal year 2020 are unchanged. The Company also elected the package of practical expedients permitted under the standard, which does not require reassessment of prior conclusions related to contracts containing a lease, lease classification and initial direct lease costs. As an ongoing accounting policy election, the Company will exclude short-term leases (terms of 12 months or less) from the balance sheet presentation and will account for non-lease and lease components in a contract as a single lease component for most asset classes. All leases in which the Company is the lessee are classified as operating leases, and the Company does not have any finance leases or sublease agreements. Additionally, the Company does not have any leases in which it is the lessor.

The adoption of the new standard had a significant impact on the Company's condensed consolidated balance sheet due to the recognition of approximately $41 million of lease liabilities with corresponding ROU assets for operating leases. The new standard did not have a significant impact on the condensed consolidated statements of operations or cash flows, and did not impact our debt covenant compliance under our current credit agreements.

The Company determines if an arrangement is a lease at inception. The Company leases certain facilities and machinery and equipment under long-term, non-cancelable operating leases. As of January 1, 2021, the Company had approximately 200 leases, with remaining terms ranging from less than one year to 15 years. Some of the leases contain variable payment terms, such as payments based on fluctuations in the Consumer Price Index (CPI). Some leases also contain options to extend or terminate the lease. To the extent the Company is reasonably certain to exercise these options, they have been considered in the calculation of the ROU assets and lease liabilities. Under current lease agreements, there are no residual value guarantees or restrictive lease covenants. In calculating the ROU assets and lease liabilities, several assumptions and judgments were made by the Company, including whether a contract is or contains a lease under the new definition, and the determination of the discount rate, which is assumed to be the incremental borrowing rate. The incremental borrowing rate is derived from information available to the Company at the lease commencement date based on lease length and location.

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended January 1, 2021 and December 27, 2019 were as follows:

	Three months ended		Three months ended
	January 1, 2021		December 27, 2019
Lease Cost
Operating lease costs	$	2,012	$	1,776
Short-term lease costs	391		483
Variable leases costs	46		43
Total lease cost	$	2,449	$	2,302

Included in the amounts in the table above, were rent expense to related parties of $255 and $246 for the three months ended January 1, 2021 and December 27, 2019, respectively.

As of January 1, 2021, the Company did not have any finance leases. There were no significant new leases entered into during the quarter ended January 1, 2021. Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:

	Three months ended			Three months ended
	January 1, 2021			December 27, 2019
Operating leases:
Operating lease ROU assets	$	38,784		$	40,302
Current operating leases liabilities	6,411			5,835
Non-current operating lease liabilities	33,260			35,133
Total operating lease liabilities	$	39,671		$	40,968
Weighted average remaining lease term (in years)	9.88			10.67
Weighted average discount rate	2.84		%	2.83		%
Cash paid for amounts included in the measurement of lease liabilities	$	1,857		$	1,571

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at January 1, 2021 were as follows:

Year	Related parties included in total		Total
Remainder of 2021	$	868	$	6,508
2022	193		5,316
2023	—		4,619
2024	—		4,617
2025	—		3,676
Thereafter	—		21,512
Total undiscounted lease payments	1,061		46,248
Less: Imputed interest	(9)		(6,577)
Total net lease liability	$	1,052	$	39,671

As of January 1, 2021, the Company did not have any additional significant operating leases commitments that have not yet commenced.

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BASIS OF PRESENTATION (Policies)

3 Months Ended

Jan. 01, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

The condensed consolidated financial statements included herein are unaudited. In the opinion of management, these statements contain all adjustments (consisting of only normal recurring items) necessary to present fairly the financial position of Johnson Outdoors Inc. and subsidiaries (collectively, the “Company”) as of January 1, 2021 and December 27, 2019, and their results of operations for the three month periods then ended and cash flows for the three month periods then ended. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended October 2, 2020 which was filed with the Securities and Exchange Commission on December 11, 2020.

Due to seasonal variations and other factors, some of which are described herein, including related to the coronavirus (COVID-19) outbreak and resulting pandemic, the results of operations for the three months ended January 1, 2021 are not necessarily indicative of the results to be expected for the Company’s full 2021 fiscal year.  See "Coronavirus (COVID-19) below and “Seasonality” and "Coronavirus (COVID-19)" in the Management’s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere herein for additional information.

The Company considers all short-term investments in interest-bearing accounts and all securities and other instruments with an original maturity of three months or less, to be equivalent to cash. Cash equivalents are stated at cost which approximates market value.

All monetary amounts, other than share and per share amounts, are stated in thousands.

Coronavirus (COVID-19)

Coronavirus (COVID-19)

In March 2020, the World Health Organization recognized the current coronavirus (COVID-19) outbreak as a global pandemic. In response to the COVID-19 outbreak, the governments of many countries, states, cities and other geographic regions imposed varying degrees of restrictions on social and commercial activity, including imposing travel restrictions, issuing quarantine, shelter-in-place and stay at home orders and guidelines and related actions, mandating mask wearing, limiting business capacity and generally restricting freedom of movement, in order to promote social distancing and other similar programs all in an effort to slow the spread of the illness.

While some government mandates eased in the latter half of fiscal 2020, these mandates continued to emphasize social distancing measures to the general public. As a result, we saw increased participation in fishing, camping and watercraft recreation and related demand for our products, largely driven by consumer desire to engage in socially distant and safe activities in the great outdoors in the latter part of fiscal 2020, which continued into the first quarter of fiscal 2021. Nonetheless, the full extent to which the COVID-19 pandemic will impact our business, results of operations, and financial condition, including with respect to consumer buying patterns for the rest of our fiscal 2021, will depend on future developments, including any potential worsening or improvement of the pandemic, which are beyond our control and which remain highly uncertain and cannot be predicted. This includes, but is not limited to, the duration, spread, severity and impact of the COVID-19 pandemic, vaccine distribution and effectiveness, or future waves, increasing outbreaks or hot spots of the pandemic in our areas of operations or in key markets, the effects of the pandemic on our customers, consumers, suppliers and vendors and the remedial actions and stimulus measures adopted by federal, state and local governments in reaction to the pandemic. Further, the authorization of vaccines for COVID-19 by governments around the world, including the distribution of same, may further impact commercial activity and customer or consumer buying behavior, and the extent to which these developments will impact demand for, and participation in, outdoor recreation and related products is unknown. As the COVID-19 pandemic continues to impact various key regions of the world, even after it subsides, we may continue to experience adverse impacts to our business, including our supply chain, as a result of any economic recession that has occurred or may occur in the future. As a result, the Company cannot reasonably estimate the full impact of the COVID-19 pandemic on Company operations and profitability at this time as the situation is dynamic and constantly changing. We continue to monitor evolving economic and general business conditions stemming from the COVID-19 pandemic and the actual and potential impacts on our financial position, results of operations and cash flows.

Recently adapted and issued accounting pronouncements

Recently adopted accounting pronouncements

In February 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842). In July 2018, the FASB also issued ASU 2018-10 Codification Improvements to Topic 842, Leases and ASU 2018-11 Leases (Topic 842) Targeted Improvements. In February 2019, the FASB also issued ASU 2019-01 Leases (Topic 842): Codification Improvements. This ASU and the updates to this ASU require organizations to recognize lease assets and lease liabilities on the balance sheet and to disclose key information about leasing arrangements. This guidance was effective for the Company in the first quarter of fiscal year 2020, and may be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements with certain practical expedients available. The Company adopted the provisions of these ASU's using the modified retrospective approach at the beginning of the first quarter of fiscal 2020, coinciding with the standard's effective date. The additional disclosures required by the ASU and its updates are included in Note 18 "Leases" of these Notes to the Condensed Consolidated Financial Statements.

In June 2016, the FASB issued ASU 2016-13 “Financial Instruments - Credit Losses (Topic 326)” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively Topic 326). Topic 326 requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. This replaces the existing incurred loss model with an expected loss model and requires the use of forward-looking information to calculate credit loss estimates. This guidance was effective for the Company in the first quarter of fiscal year 2021, and must be adopted by applying a cumulative effect adjustment to retained earnings. The Company adopted the provisions of this ASU at the beginning of the first quarter of fiscal 2021, however the ASU did not have a significant impact on its financial statements, and therefore no adjustment to retained earnings was necessary.

    Recently issued accounting pronouncements

In August 2018, the FASB issued ASU 2018-14, Changes to the Disclosure Requirements for Defined Benefit Plans (Topic 715), which modifies the disclosure requirements for employers that sponsor defined pension or postretirement plans. The amendments in this guidance are effective for fiscal years ending after December 15, 2020, with early adoption permitted. The Company is currently evaluating the potential impact of this guidance on its disclosures.

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740)—Simplifying the Accounting for Income Taxes. ASU 2019-12 is intended to simplify accounting for income taxes. It removes certain exceptions to the general principles in Topic 740 and amends existing guidance to improve consistent application. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 and interim periods within those fiscal years, with early adoption permitted. The Company does not expect adoption of the new guidance to have a significant impact on its financial statements.

Revenues

Revenue is recognized when obligations under the terms of a contract with our customer are satisfied; generally this occurs with the transfer of control of our goods at a point in time based on shipping terms and transfer of title. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods. The amount of consideration received can vary, primarily because of customer incentive or rebate arrangements. The Company estimates variable consideration based on the expected value of total consideration to which customers are likely to be entitled based on historical experience and projected market expectations. Included in the estimate is an assessment as to whether any variable consideration is constrained. Revenue estimates are adjusted at the earlier of a change in the expected value of consideration or when the consideration becomes fixed. For all contracts with customers, the Company has not adjusted the promised amount of consideration for the effects of a significant financing component as the period between the transfer of the promised goods and the customer's payment is expected to be one year or less. Sales are made on normal and customary short-term credit terms, generally ranging from 30 to 90 days, or upon delivery of point of sale transactions. Sales, value add, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The Company enters into contractual arrangements with customers in the form of individual customer orders which specify the goods, quantity, pricing, and associated order terms. The Company does not have contracts which are satisfied over time. Due to the nature of these contracts, no significant judgment exists in relation to the identification of the customer contract, satisfaction of the performance obligation, or transaction price. The Company expenses incremental costs of obtaining a contract due to the short-term nature of the contracts.

Estimated costs of returns, allowances and discounts, based on historic experience, are accrued as a reduction to sales when revenue is recognized. The Company provides customers the right to return eligible products under certain circumstances. At January 1, 2021, the right to returns asset was $1,367 and the accrued returns liability was $3,621. At December 27, 2019, the right to returns asset was $1,112 and the accrued returns liability was $3,394. The Company also offers assurance-type warranties relating to its products sold to end customers that continue to be accounted for under ASC 460 Guarantees.

The Company generally accounts for shipping and handling activities as a fulfillment activity, consistent with the timing of revenue recognition; that is, when a customer takes control of the transferred goods. In the event that a customer were to take control of a product upon or after shipment, the Company has made an accounting policy election to treat such shipping and handling activities as a fulfillment cost. Shipping and handling fees billed to customers are included in "Net Sales," and shipping and handling costs are recognized within "Marketing and selling expenses" in the same period the related revenue is recognized.

The Company has a wide variety of seasonal, outdoor recreation products used primarily for fishing from a boat, diving, paddling, hiking and camping, that are sold to a variety of customers in multiple end markets. Nonetheless, the revenue recognition policies are similar among all the various products sold by the Company.

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EARNINGS PER SHARE (“EPS”) (Tables)

3 Months Ended

Jan. 01, 2021

Earnings Per Share [Abstract]

Schedule of dividends declared

Dividends per share for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

	Three Months Ended
	January 1, 2021		December 27, 2019
Dividends declared per common share:
Class A	$	0.21	$	0.17
Class B	$	0.19	$	0.15

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STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS (Tables)

3 Months Ended

Jan. 01, 2021

Share-based Payment Arrangement [Abstract]

Schedule of non-vested stock activity

A summary of non-vested stock activity for the three months ended January 1, 2021 related to the Company’s stock ownership plans is as follows:

	Shares	Weighted Average Grant Price
Non-vested stock at October 2, 2020	40,492	$	62.15
Non-vested stock grants	8,758	88.49
Restricted stock vested	(7,586)	43.12
Non-vested stock at January 1, 2021	41,664	71.15

Schedule of RSU activity

A summary of RSU activity for the three months ended January 1, 2021 follows:

	Number of RSUs	Weighted Average Grant Price
RSUs at October 2, 2020	67,821	$	68.34
RSUs granted	20,059	88.49
RSUs vested	(18,112)	43.49
RSUs at January 1, 2021	69,768	80.58

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PENSION PLANS (Tables)

3 Months Ended

Jan. 01, 2021

Retirement Benefits [Abstract]

Schedule of components of net periodic benefit cost

The components of net periodic benefit cost related to Company sponsored defined benefit plans for the three month periods ended January 1, 2021 and December 27, 2019 were as follows:

	Three Months Ended
	January 1, 2021		December 27, 2019
Components of net periodic benefit cost:
Service cost	$	—	$	—
Interest on projected benefit obligation	233		276
Less estimated return on plan assets	160		214
Amortization of unrecognized losses (gains)	134		82
Net periodic benefit cost	$	207	$	144

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INCOME TAXES (Tables)

3 Months Ended

Jan. 01, 2021

Income Tax Disclosure [Abstract]

Summary of earnings before income taxes, income tax expense and effective income tax rate

For the three months ended January 1, 2021 and December 27, 2019, the Company’s earnings before income taxes, income tax expense and effective income tax rate were as follows:

	Three Months Ended
(thousands, except tax rate data)	January 1, 2021			December 27, 2019
Profit before income taxes	$	26,011		$	8,589
Income tax expense	6,164			2,159
Effective income tax rate	23.7		%	25.1		%

Summary of tax jurisdictions of entities with valuation allowances

The significant tax jurisdictions that have a valuation allowance for the periods ended January 1, 2021 and December 27, 2019 were:

January 1, 2021	December 27, 2019
France	France
Indonesia	Indonesia
Switzerland	Switzerland

Summary of income tax examinations

As of the date of this report, the following tax years remain open to examination by the respective significant tax jurisdictions:

Jurisdiction	Fiscal Years
United States	2017-2020
Canada	2016-2020
France	2017-2020
Germany	2017-2020
Italy	2018-2020
Switzerland	2010-2020

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INVENTORIES (Tables)

3 Months Ended

Jan. 01, 2021

Inventory Disclosure [Abstract]

Schedule of inventories

Inventories at the end of the respective periods consisted of the following:

	January 1, 2021		October 2, 2020		December 27, 2019
Raw materials	$	63,353	$	48,874	$	47,208
Work in process	38		39		463
Finished goods	51,458		48,524		56,214
	$	114,849	$	97,437	$	103,885

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GOODWILL (Tables)

3 Months Ended

Jan. 01, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of goodwill

The changes in goodwill during the three months ended January 1, 2021 and December 27, 2019 were as follows:

	January 1, 2021		December 27, 2019
Balance at beginning of period	$	11,184	$	11,186
Amount attributable to movements in foreign currency rates	35		7
Balance at end of period	$	11,219	$	11,193

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WARRANTIES (Tables)

3 Months Ended

Jan. 01, 2021

Product Warranties Disclosures [Abstract]

Summary of warranty activity

The following table summarizes the Company’s warranty activity for the three months ended January 1, 2021 and December 27, 2019.

	January 1, 2021		December 27, 2019
Balance at beginning of period	$	10,849	$	9,190
Expense accruals for warranties issued during the period	3,177		3,335
Less current period warranty claims paid	2,046		2,082
Balance at end of period	$	11,980	$	10,443

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FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Jan. 01, 2021

Fair Value Disclosures [Abstract]

Summary of financial assets measured at fair value

The following table summarizes the Company’s financial assets measured at fair value as of January 1, 2021:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	25,032	$	—	$	—	$	25,032

The following table summarizes the Company’s financial assets measured at fair value as of October 2, 2020:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	21,550	$	—	$	—	$	21,550

The following table summarizes the Company’s financial assets measured at fair value as of December 27, 2019:

	Level 1		Level 2		Level 3		Total
Assets:
Rabbi trust assets	$	20,978	$	—	$	—	$	20,978

Schedule of Effect of changes in the fair value of financial instruments

The effect of changes in the fair value of financial instruments on the accompanying Condensed Consolidated Statements of Operations for the three month periods ended January 1, 2021 and December 27, 2019 was:

		Three Months Ended
	Location of income loss recognized in Statement of Operations	January 1, 2021		December 27, 2019
Rabbi trust assets	Other income, net	$	2,596	$	1,192

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SEGMENTS OF BUSINESS (Tables)

3 Months Ended

Jan. 01, 2021

Segment Reporting [Abstract]

Summary of operations by business unit

A summary of the Company’s operations by business segment is presented below:

	Three Months Ended
	January 1, 2021		December 27, 2019		October 2, 2020
Net sales:
Fishing:
Unaffiliated customers	$	126,859	$	99,193
Interunit transfers	140		85
Camping:
Unaffiliated customers	12,185		7,505
Interunit transfers	9		9
Watercraft Recreation:
Unaffiliated customers	12,397		4,803
Interunit transfers	46		6
Diving
Unaffiliated customers	14,090		16,458
Interunit transfers	3		1
Other / Corporate	136		95
Eliminations	(198)		(101)
Total	$	165,667	$	128,054
Operating profit (loss):
Fishing	$	27,763	$	15,018
Camping	2,808		66
Watercraft Recreation	1,069		(1,563)
Diving	(341)		205
Other / Corporate	(7,742)		(6,925)
	$	23,557	$	6,801
Total assets (end of period):
Fishing	$	244,217	$	216,783	$	206,244
Camping	40,901		32,815		37,514
Watercraft Recreation	24,058		20,611		21,038
Diving	68,818		64,799		67,393
Other / Corporate	199,187		151,115		213,837
	$	577,181	$	486,123	$	546,026

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables)

3 Months Ended

Jan. 01, 2021

Equity [Abstract]

Summary of changes in AOCI by component, net of tax

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended January 1, 2021 were as follows:

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at October 2, 2020	$	7,323	$	(2,606)	$	4,717
Other comprehensive income before reclassifications	2,442		—		2,442
Amounts reclassified from accumulated other comprehensive income	—		135		135
Tax effects	—		(34)		(34)
Balance at January 1, 2021	$	9,765	$	(2,505)	$	7,260

The changes in AOCI by component, net of tax, for the three months ended December 27, 2019 were as follows: 

	Foreign Currency Translation Adjustment		Unamortized Loss on Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance at September 27, 2019	$	4,790	$	(3,232)	$	1,558
Other comprehensive income before reclassifications	700		—		700
Amounts reclassified from accumulated other comprehensive income	—		82		82
Tax effects	—		(21)		(21)
Balance at December 27, 2019	$	5,490	$	(3,171)	$	2,319

Summary of reclassifications out of AOCI

The reclassifications out of AOCI for the three months ended January 1, 2021 and December 27, 2019 were as follows: 

	Three Months Ended
	January 1, 2021		December 27, 2019		Statement of Operations Presentation
Unamortized loss on defined benefit pension plans:
Amortization of loss	$	135	$	82	Other income and expense
Tax effects	(34)		(21)		Income tax expense
Total reclassifications for the period	$	101	$	61

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LEASES (Tables)

3 Months Ended

Jan. 01, 2021

Leases [Abstract]

Summary of components of lease expense

The components of lease expense recognized in the accompanying Condensed Consolidated Statements of Operations for the three months ended January 1, 2021 and December 27, 2019 were as follows:

	Three months ended		Three months ended
	January 1, 2021		December 27, 2019
Lease Cost
Operating lease costs	$	2,012	$	1,776
Short-term lease costs	391		483
Variable leases costs	46		43
Total lease cost	$	2,449	$	2,302

Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:

	Three months ended			Three months ended
	January 1, 2021			December 27, 2019
Operating leases:
Operating lease ROU assets	$	38,784		$	40,302
Current operating leases liabilities	6,411			5,835
Non-current operating lease liabilities	33,260			35,133
Total operating lease liabilities	$	39,671		$	40,968
Weighted average remaining lease term (in years)	9.88			10.67
Weighted average discount rate	2.84		%	2.83		%
Cash paid for amounts included in the measurement of lease liabilities	$	1,857		$	1,571

Schedule of right of use assets and lease liabilities

Supplemental balance sheet, cash flow, and other information related to operating leases was as follows:

	Three months ended			Three months ended
	January 1, 2021			December 27, 2019
Operating leases:
Operating lease ROU assets	$	38,784		$	40,302
Current operating leases liabilities	6,411			5,835
Non-current operating lease liabilities	33,260			35,133
Total operating lease liabilities	$	39,671		$	40,968
Weighted average remaining lease term (in years)	9.88			10.67
Weighted average discount rate	2.84		%	2.83		%
Cash paid for amounts included in the measurement of lease liabilities	$	1,857		$	1,571

Schedule of maturities of operating lease liabilities

Future minimum rental commitments under non-cancelable operating leases with an initial lease term in excess of one year at January 1, 2021 were as follows:

Year	Related parties included in total		Total
Remainder of 2021	$	868	$	6,508
2022	193		5,316
2023	—		4,619
2024	—		4,617
2025	—		3,676
Thereafter	—		21,512
Total undiscounted lease payments	1,061		46,248
Less: Imputed interest	(9)		(6,577)
Total net lease liability	$	1,052	$	39,671

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ACCOUNTS RECEIVABLE (Details) - USD ($) $ in Thousands	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Receivables [Abstract]
Allowances for doubtful accounts receivable	$ 2,823	$ 2,697	$ 3,062
Accounts receivable, net	$ 97,386	$ 67,292	$ 78,249

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EARNINGS PER SHARE (“EPS”) (Details) - $ / shares	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Percentage of cash dividends on Class A common stock relative to Class B common stock	110.00%
Non-Vested Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	40,647	40,312
Restricted Stock Units (RSUs)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	30,786	41,111
Class A
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dividends declared per common share (in dollars per share)	$ 0.21	$ 0.17
Class B
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dividends declared per common share (in dollars per share)	$ 0.19	$ 0.15

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STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS (Narrative) (Details) - USD ($) $ in Thousands		3 Months Ended
	Mar. 02, 2017	Jan. 01, 2021	Dec. 27, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares available for grant (shares)		507,510
Award performance period (in years)		3 years
Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Employee stock purchase plan shares issued (shares)		0	0
Issuance of stock under employee stock purchase plan (income) expense		$ 0	$ 7
Non-Vested Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares tendered for tax withholding (shares)		2,341	4,054
Stock-based compensation expense, net of forfeitures		$ 279	$ 240
Unrecognized stock-based compensation expense		1,672
Fair value of vested restricted stock		$ 658	839
Non-Vested Stock | Director | Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period (in years)		1 year
Non-Vested Stock | Employees | Class A
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period (in years)		4 years
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense, net of forfeitures		$ 432	420
Unrecognized stock-based compensation expense		3,050
Fair value of vested restricted stock		$ 2,148	$ 1,426
Shares tendered back to company (shares)		3,320	3,075
Restricted Stock Units (RSUs) | Vesting Period 1
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period (in years)		1 year
Restricted Stock Units (RSUs) | Vesting Period 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period (in years)		3 years
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Bonus achievement target level (in percent)		80.00%
Bonus payout as a percentage of target award		50.00%
Employee stock purchase plan, purchase price (in percent)	85.00%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Bonus achievement target level (in percent)		120.00%
Bonus payout as a percentage of target award		150.00%

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STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS (Schedule of Non-Vested Stock Activity) (Details) - Non-Vested Stock	3 Months Ended
	Jan. 01, 2021 $ / shares shares
Shares
Beginning Balance (shares) | shares	40,492
Grants (shares) | shares	8,758
Vested (shares) | shares	(7,586)
Ending Balance (shares) | shares	41,664
Weighted Average Grant Price
Beginning Balance (USD per share) | $ / shares	$ 62.15
Grants (USD per share) | $ / shares	88.49
Vested (USD per share) | $ / shares	43.12
Ending Balance (USD per share) | $ / shares	$ 71.15

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STOCK-BASED COMPENSATION AND STOCK OWNERSHIP PLANS (Schedule of RSU Activity) (Details) - Restricted Stock Units (RSUs)	3 Months Ended
	Jan. 01, 2021 $ / shares shares
Number of RSUs
Beginning Balance (shares) | shares	67,821
Grants (shares) | shares	20,059
Vested (shares) | shares	(18,112)
Ending Balance (shares) | shares	69,768
Weighted Average Grant Price
Beginning Balance (USD per share) | $ / shares	$ 68.34
Grants (USD per share) | $ / shares	88.49
Vested (USD per share) | $ / shares	43.49
Ending Balance (USD per share) | $ / shares	$ 80.58

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PENSION PLANS (Narrative) (Details) $ in Thousands	3 Months Ended
	Oct. 01, 2021 USD ($)	Jan. 01, 2021 USD ($) plan	Dec. 27, 2019 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Non-contributory defined benefit pension plans | plan		2
Pension plan contributions		$ 43	$ 44
Minimum | Forecast
Defined Benefit Plan Disclosure [Line Items]
Plan termination expense	$ 4,000
Maximum | Forecast
Defined Benefit Plan Disclosure [Line Items]
Plan termination expense	$ 5,000

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PENSION PLANS (Components of Net Periodic Benefit Cost) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Components of net periodic benefit cost:
Service cost	$ 0	$ 0
Interest on projected benefit obligation	233	276
Less estimated return on plan assets	160	214
Amortization of unrecognized losses (gains)	134	82
Net periodic benefit cost	$ 207	$ 144

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INCOME TAXES (Narrative) (Details) $ in Thousands	12 Months Ended
	Oct. 01, 2021 USD ($)
Forecast
Income Tax Contingency [Line Items]
Accrued interest related to uncertain income tax positions	$ 300

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INCOME TAXES (Summary of Earnings Before Income Taxes, Income Tax Expense and Effective Income Tax Rate) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Income Tax Disclosure [Abstract]
Profit before income taxes	$ 26,011	$ 8,589
Income tax expense	$ 6,164	$ 2,159
Effective income tax rate	23.70%	25.10%

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INVENTORIES (Details) - USD ($) $ in Thousands	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 63,353	$ 48,874	$ 47,208
Work in process	38	39	463
Finished goods	51,458	48,524	56,214
Inventories	$ 114,849	$ 97,437	$ 103,885

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GOODWILL (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Goodwill [Roll Forward]
Balance at beginning of period	$ 11,184	$ 11,186
Amount attributable to movements in foreign currency rates	35	7
Balance at end of period	$ 11,219	$ 11,193

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WARRANTIES (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward]
Balance at beginning of period	$ 10,849	$ 9,190
Expense accruals for warranties issued during the period	3,177	3,335
Less current period warranty claims paid	2,046	2,082
Balance at end of period	$ 11,980	$ 10,443

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INDEBTEDNESS (Narrative) (Details) - USD ($)	3 Months Ended
	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Debt Instrument [Line Items]
Debt outstanding	$ 0
Financial Standby Letter of Credit
Debt Instrument [Line Items]
Letters of credit outstanding	181,000		$ 181,000
Unsecured Revolving Credit Facilities At Foreign Subsidiaries
Debt Instrument [Line Items]
Debt outstanding		$ 0	0
Unsecured revolving credit facilities	0		$ 0
Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 125,000,000
Interest rate (in percent)	1.10%		2.80%
Revolving Credit Facility | Minimum | LIBOR
Debt Instrument [Line Items]
Margin percentage	1.00%
Revolving Credit Facility | Maximum | LIBOR
Debt Instrument [Line Items]
Margin percentage	1.75%
Revolving Credit Facility | Revolvers Borrowing Capacity Standard
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 75,000,000
Accordion feature	$ 50,000,000

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Details) - contract	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Derivative [Line Items]
Number of foreign currency forward contracts (in contracts)	0	0
Geographic Concentration Risk | Revenue Benchmark
Derivative [Line Items]
Percent of revenues in foreign currency	10.00%
Geographic Concentration Risk | Revenue Benchmark | Euro
Derivative [Line Items]
Percent of revenues in foreign currency	4.00%
Geographic Concentration Risk | Revenue Benchmark | Canadian Dollars
Derivative [Line Items]
Percent of revenues in foreign currency	4.00%
Geographic Concentration Risk | Revenue Benchmark | Hong Kong, Dollars
Derivative [Line Items]
Percent of revenues in foreign currency	1.00%

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FAIR VALUE MEASUREMENTS (Summary of Financial Assets) (Details) - USD ($) $ in Thousands	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Rabbi trust assets	$ 25,032	$ 21,550	$ 20,978
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Rabbi trust assets	25,032	21,550	20,978
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Rabbi trust assets	0	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Rabbi trust assets	$ 0	$ 0	$ 0

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FAIR VALUE MEASUREMENTS (Effect of Changes in Financial Instruments) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Rabbi trust assets
Fair Value, Option, Quantitative Disclosures [Line Items]
Changes in fair value, (income)/loss	$ 2,596	$ 1,192

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FAIR VALUE MEASUREMENTS (Narrative) (Details) - Nonrecurring - USD ($)	Jan. 01, 2021	Dec. 27, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	$ 0	$ 0
Liabilities, fair value disclosure	$ 0	$ 0

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REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Oct. 02, 2020	Dec. 27, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenue, financing component	one year or less
Contract with customer, asset	$ 1,367		$ 1,112
Contract with customer, liability	5,508	$ 4,426	3,819
Accrued Discounts And Returns
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contract with customer, liability	$ 3,621		$ 3,394

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SEGMENTS OF BUSINESS (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019	Oct. 02, 2020
Segment Reporting Information [Line Items]
Net sales	$ 165,667	$ 128,054
Operating profit (loss)	23,557	6,801
Total assets (end of period)	577,181	486,123	$ 546,026
Unaffiliated customers | Fishing
Segment Reporting Information [Line Items]
Net sales	126,859	99,193
Operating profit (loss)	27,763	15,018
Total assets (end of period)	244,217	216,783	206,244
Unaffiliated customers | Camping
Segment Reporting Information [Line Items]
Net sales	12,185	7,505
Operating profit (loss)	2,808	66
Total assets (end of period)	40,901	32,815	37,514
Unaffiliated customers | Watercraft Recreation
Segment Reporting Information [Line Items]
Net sales	12,397	4,803
Operating profit (loss)	1,069	(1,563)
Total assets (end of period)	24,058	20,611	21,038
Unaffiliated customers | Diving
Segment Reporting Information [Line Items]
Net sales	14,090	16,458
Operating profit (loss)	(341)	205
Total assets (end of period)	68,818	64,799	67,393
Interunit transfers
Segment Reporting Information [Line Items]
Net sales	(198)	(101)
Interunit transfers | Fishing
Segment Reporting Information [Line Items]
Net sales	(140)	(85)
Interunit transfers | Camping
Segment Reporting Information [Line Items]
Net sales	(9)	(9)
Interunit transfers | Watercraft Recreation
Segment Reporting Information [Line Items]
Net sales	(46)	(6)
Interunit transfers | Diving
Segment Reporting Information [Line Items]
Net sales	(3)	(1)
Other / Corporate
Segment Reporting Information [Line Items]
Net sales	136	95
Operating profit (loss)	(7,742)	(6,925)
Total assets (end of period)	199,187	151,115	$ 213,837
Customer One
Segment Reporting Information [Line Items]
Net sales	$ 53,573
Customer One
Segment Reporting Information [Line Items]
Net sales		$ 32,321

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Changes by Component) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period	$ 378,100
Other comprehensive income before reclassifications	2,442	$ 700
Amounts reclassified from accumulated other comprehensive income	135	82
Tax effects	(34)	(21)
Balance, end of period	398,612	330,239
Accumulated Other Comprehensive Income (Loss)
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period	4,717	1,558
Balance, end of period	7,260	2,319
Foreign Currency Translation Adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period	7,323	4,790
Other comprehensive income before reclassifications	2,442	700
Amounts reclassified from accumulated other comprehensive income	0	0
Tax effects	0	0
Balance, end of period	9,765	5,490
Unamortized Loss on Defined Benefit Pension Plans
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance, beginning of period	(2,606)	(3,232)
Other comprehensive income before reclassifications	0	0
Amounts reclassified from accumulated other comprehensive income	135	82
Tax effects	(34)	(21)
Balance, end of period	$ (2,505)	$ (3,171)

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ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Reclassifications) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amortization of loss	$ 2,404	$ 1,168
Tax effects	(6,164)	(2,159)
Total reclassifications for the period	19,847	6,430
Unamortized Loss on Defined Benefit Pension Plans | Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Amortization of loss	135	82
Tax effects	(34)	(21)
Total reclassifications for the period	$ 101	$ 61

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LEASES (Narrative) (Details) $ in Thousands	3 Months Ended
	Jan. 01, 2021 USD ($) contract	Dec. 27, 2019 USD ($)	Oct. 02, 2020 USD ($)	Sep. 28, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Total net lease liability	$ 39,671	$ 40,968
Right of use assets	$ 38,784	40,302	$ 40,666
Number of contracts | contract	200
Minimum
Lessee, Lease, Description [Line Items]
Remaining lease term (in years)	1 year
Maximum
Lessee, Lease, Description [Line Items]
Remaining lease term (in years)	15 years
Accounting Standards Update 2016-02
Lessee, Lease, Description [Line Items]
Total net lease liability				$ 41,000
Right of use assets				$ 41,000
Affiliated Entity
Lessee, Lease, Description [Line Items]
Total net lease liability	$ 1,052
Operating lease, cost	$ 255	$ 246

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LEASES (Components of Lease Expense) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019
Lease Cost
Operating lease costs	$ 2,012	$ 1,776
Short-term lease costs	391	483
Variable leases costs	46	43
Total lease cost	$ 2,449	$ 2,302

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LEASES (Other Information Related to Operating Leases) (Details) - USD ($) $ in Thousands	3 Months Ended
	Jan. 01, 2021	Dec. 27, 2019	Oct. 02, 2020
Operating leases:
Operating lease ROU assets	$ 38,784	$ 40,302	$ 40,666
Current operating leases liabilities	6,411	5,835	6,587
Non-current operating lease liabilities	33,260	35,133	$ 34,931
Total operating lease liabilities	$ 39,671	$ 40,968
Weighted average remaining lease term (in years)	9 years 10 months 17 days	10 years 8 months 1 day
Weighted average discount rate	2.84%	2.83%
Cash paid for amounts included in the measurement of lease liabilities	$ 1,857	$ 1,571

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LEASES (Future Minimum Rental Commitments Under Non-Cancelable Operating Leases) (Details) - USD ($) $ in Thousands	Jan. 01, 2021	Dec. 27, 2019
Finance Leases, After Adoption of 842:
Remainder of 2021	$ 6,508
2022	5,316
2023	4,619
2024	4,617
2025	3,676
Thereafter	21,512
Total undiscounted lease payments	46,248
Less: Imputed interest	(6,577)
Total net lease liability	39,671	$ 40,968
Affiliated Entity
Finance Leases, After Adoption of 842:
Remainder of 2021	868
2022	193
2023	0
2024	0
2025	0
Thereafter	0
Total undiscounted lease payments	1,061
Less: Imputed interest	(9)
Total net lease liability	$ 1,052