Q3 gross profit percentage was 29% of net sales, down from 31% in Q2. This is, at least at first glance, a TERRIBLE result and COMPLETELY CONTRARY to guidance provided in the Q2 conference call, where someone said (halfway into Q3, mind you) - that while Q2 margins were down, "I think you'll see Q3 margins back in line with what we saw in Q1". Instead, they declined further.
On the possible/likely upside: Q3 include perhaps $2.5M in "extra" discounts/allowances related to sale of remaining "old" Assault inventory and introductory pricing for Arnold. If this goes away entirely in Q4 (i.e., old Assault inventory was completely depeleted in Q3, Arnold products are now being sold at "normal" prices), then margins should be up DRAMATICALLY in Q4.
On the downside: Halfway through the qtr, margin projections thrown out on the CC turned out to be completely wrong - they either lied or are really terrible at projecting.