"Innovation is at the core of Johnson Outdoors....

.......giving us the ability to compete on quality and price/ value, rather than price alone, helping to sustain market leadership even during tough economic times. Throughout the organization, we are dedicated to meaningful innovation in everything we do - from developing winning new products, to designing smart manufacturing processes to creating unique go-to-market programs - everything that keeps our business growing.  

The economic downturn emphasized the value of our efforts over the last five years to make Johnson Outdoors more efficient and effective. We once again outperformed our peers in 2008 as many of our brands held or gained share against the competition. Strengthened and streamlined processes and systems helped ease the downturn’s effects.

Even so, the weak economy outweighed positive gains from the first half of the year, for results that compared unfavorably to prior year. We believe our markets will rebound with the economy, and when that occurs, we will be stronger and better positioned for growth. We remain excited about the future of Johnson Outdoors.   

The economy affected some markets and brands more than others, particularly the marine marketplace. We responded with mid-season dealer programs, consumer promotions and scaled-back production to reduce inventory in every operation. Aggressive, comprehensive plans are in place to improve efficiency across the organization, while a targeted 20 percent sku reduction in each business will focus resources appropriately and drive simplification.

Going forward, operations will be structured to operate efficiently through our industry’s cyclical valleys, while maintaining the flexibility to ramp up efficiently for its peaks. Restructuring in Diving and Outdoor Gear achieved this balance, with efforts underway in Marine Electronics and Watercraft to manage staffing accordingly.. Ultimately, we will be a leaner, yet more agile manufacturer.

Equally important, as the industry’s innovation leaders, we are strongly positioned for the market’s upswing and long-term, profitable growth.

•  Outdoor Gear The constant ebb and flow in military orders, coupled with the realities of special-event tent order cycles, led to restructuring of Binghamton operations in June. Consumer tent sales grew, driven by our innovative wired tents as well as the trend for stay-at-home vacations.

The online channel continues to grow in size and importance to our markets, and we have a win-win e-commerce model that benefits our retailers by giving them the opportunity to fulfill online consumer orders. Direct-to-consumer e-marketing programs are also strengthening consumer relationships while capturing important insights necessary for us to beat the competition in the rapidly growing e-marketplace.

Johnson Outdoors lives and breathes innovation, which is why our brands continued to gain market share this year.  In 2008, for the fifth year in a row, new products contributed a third or more to total company revenues. And we have a full pipeline of new product ideas and concepts for years to come.

Despite the current economic climate, our excitement for the future is undiminished. We have strong brands and the foundation to support profitable growth when our markets rebound. And we have a remarkable asset in our people. Their passion fuels our innovation. They drive our success. I am very pleased that Johnson Outdoors is their “workplace of choice,” as recognized by Outside magazine.

Long-term, we will deliver increasing shareholder value through sustainable, profitable growth. We will delight our customers and consumers. We will build on the strengths of our team. And we will own the outdoor adventure with innovation and passion.