Sturm Ruger CEO says gunmaker has no plans to leave Fairfield base
Published 12:21 pm, Wednesday, May 1, 2013
Some firearms manufacturers have threatened to leave Connecticut in response to tougher new gun legislation, but Sturm Ruger in Fairfield is not one of them.
The company, based in the Southport section of town, saw a boost in sales in the first quarter and has no plans to leave the state, Michael Fifer, president and chief executive officer, told a company annual stockholder meeting Tuesday in Prescott, Ariz. The comments were broadcast on the company's web site.
"Consumers ask us why we are in Connecticut and why do you support a state that doesn't support you? We've got good engineers and a small headquarters there. I'm not going to disrupt those people and move out," Fifer said, adding that he will continue to push gun rights in dealings with state officials.
However, Sturm Ruger, which reported sales jumped to $155.9 million from $112.3 million in the first quarter of 2012, does plan to expand its workforce and operations outside of the state.
"We are still hiring engineers to staff new worthwhile projects. I believe there are new opportunities for Ruger in new products," Fifer said, noting that the company has grown from 1,300 employees in 2006 to 2,100 employees today. "I'd take 18 more mechanical engineers this afternoon. We've got some great projects. If you've got some great engineers that love guns, send them my way."
Fifer's comments came as good news to Mark Barnhart, Fairfield's community and economic development director, who said moving a business is a challenge, partly because of employees' attachment to a community.
"It's often what a company has to wrestle with. They have an investment in their people. They have less than 50 people (at the 1 Lacey Place headquarters), but they've been around many years and have been a good corporate citizen," said Barnhart, adding that Sturm Ruger owns its headquarters building. "They maintain a low profile. You can drive down the Post Road and past Lacey Place and not see their building."
The company, which offers more than 30 firearms lines, is considering establishing a third manufacturing location -- in addition to its plants in Arizona and New Hampshire -- to increase production.
"We're actively seeking a third manufacturing facility -- about 250,000 square feet," Fifer said. "We're looking for a beautiful building that someone has abandoned. I need more square feet for new products. We're not talking about moving jobs out of New Hampshire or Arizona."
New product introductions were a significant component of Sturm Ruger's sales growth as new product sales in the first quarter, representing $53.3 million, or 35 percent, of firearm sales. New product introductions in the first quarter included the LC380 pistol and the SR45 pistol.
"Our earnings increased 53 percent from the first quarter of 2012, driven by the 39 percent growth in sales and our ongoing focus on continuous improvement in our operations," said Fifer, whose company was ranked by Forbes at No. 4 on its America's Best Small Companies list with a market cap of $848 million, based on information as of October 2012.
Ruger's net income climbed to $23.7 million, or $1.20 per diluted share, in the most recent quarter, compared with $15.5 million, or 79 cents a share, for the same period a year ago.
The company's board of directors declared a dividend of 49 cents per share for the first quarter.
Fifer defended Ruger's position as a firearms manufacturer and its support of efforts to encourage legislators in states to re-consider wording in the new gun legislation, which was passed in response to the December rampage-shooting murder of 20 children and six educators at Sandy Hook Elementary School in Newtown.
A spokesman for Gov. Dannel Malloy declined to comment, referring to a March 6 letter the governor wrote to Connecticut's gun makers, stating that his proposals were common sense ideas to combat gun violence.
"I know that if enacted, my proposals, as well as the plans put forth by the General Assembly, could have an impact on your business," Malloy wrote. "I recognize that there are differences between us, but it is my hope that you will continue to stay in our state so that we can continue to have an open and honest dialogue."
Some states passed legislation in haste, resulting in action that was not fully considered, Fifer said, recalling that New York's legislature had to rewrite approved legislation that regulated the size of gun clips.
"Our biggest concern is at the state level to try to address foolish legislation," Fifer said, supporting efforts by the Newtown-based National Shooting Sports Foundation to confront the issue.
NSSF President Steve Sanetti has met with several media organizations to discuss gun-control issues. Among his topics has been Connecticut manufacturers and the state's new gun legislation. The organization has chastised Malloy for what it said is "a slanderous attack on the gun industry."
FBI statistics supplied by the NSSF that track firearm background checks show a steady climb since March 2010, when 1.3 million checks were recorded. In March, some 2.3 million checks were recorded, indicating an increase in gun sales.
There are no industry-wide statistics on gun sales, said NSSF spokesman Bill Brassard Jr.
Ruger's shares rose 0.6 percent Tuesday to $51.27. They have gained 0.5 percent in the last year.