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Document and Entity Information - USD ($)	12 Months Ended
Document and Entity Information - USD ($)	Apr. 30, 2012	Jun. 27, 2012	Oct. 31, 2011
Document and Entity Information [Abstract]
Entity Registrant Name	SMITH & WESSON HOLDING CORP
Entity Central Index Key	0001092796
Document Type	10-K
Document Period End Date	Apr. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--04-30
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float			$ 184,951,073
Entity Common Stock, Shares Outstanding		0

Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 30, 2012	Apr. 30, 2011
Current assets:
Cash and cash equivalents, including restricted cash of $3,334 on April 30, 2012 and $5,821 on April 30, 2011	$ 56,717	$ 58,292
Accounts receivable, net of allowance for doubtful accounts of $1,058 on April 30, 2012 and $2,147 on April 30, 2011	48,313	64,753
Inventories	55,296	51,720
Other current assets	4,139	10,212
Assets held for sale (Note 3 and 13)	13,490	0
Deferred income taxes (Note 18)	12,759	14,121
Income tax receivable	0	4,513
Total current assets	190,714	203,611
Property, plant, and equipment, net	60,528	62,390
Intangibles, net	4,532	8,692
Other assets	5,900	6,804
Total assets	261,674	281,497
Current liabilities:
Accounts payable	28,618	40,119
Accrued expenses	20,685	25,356
Accrued payroll	9,002	5,309
Accrued income taxes	291	0
Accrued taxes other than income	4,270	11,421
Accrued profit sharing	8,040	4,081
Accrued product/municipal liability	1,397	2,584
Accrued warranty	5,349	3,424
Liabilities held for sale (Note 3)	5,693	0
Current portion of notes payable	0	30,000
Total current liabilities	83,345	122,294
Deferred income taxes (Note 18)	4,537	7,708
Notes payable, net of current portion	50,000	50,000
Other non-current liabilities	10,948	8,763
Total liabilities	148,830	188,765
Commitments and contingencies (Note 19)
Stockholders' equity:
Preferred stock, $.001 par value, 20,000,000 shares authorized, no shares issued or outstanding
Common stock, $.001 par value, 100,000,000 shares authorized, 66,512,097 shares issued and 65,312,097 shares outstanding on April 30, 2012 and 65,710,531 shares issued and 64,510,531 shares outstanding on April 30, 2011	67	66
Additional paid-in capital (Note 18)	189,379	185,373
Accumulated deficit (Note 18)	(70,279)	(86,384)
Accumulated other comprehensive income	73	73
Treasury stock, at cost (1,200,000 common shares)	(6,396)	(6,396)
Total stockholders' equity	112,844	92,732
Total liabilities and stockholders' equity	$ 261,674	$ 281,497

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Apr. 30, 2012	Apr. 30, 2011
Consolidated Balance Sheets [Abstract]
Restricted cash	$ 3,334	$ 5,821
Allowance for doubtful accounts receivable	$ 1,058	$ 2,147
Preferred stock, par value	$ .001	$ .001
Preferred stock, shares authorized	20,000,000	20,000,000
Preferred stock, shares issued
Preferred stock, shares outstanding
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	66,512,097	65,710,531
Common stock, shares outstanding	65,312,097	64,510,531
Treasury stock, shares	1,200,000	1,200,000

Consolidated Statements of Operations and Comprehensive Income/(Loss) - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Apr. 30, 2012	Apr. 30, 2011	Apr. 30, 2010
Consolidated Statements of Operations and Comprehensive Income/(Loss) [Abstract]
Net sales	$ 411,997	$ 342,233	$ 357,926
Cost of sales	284,008	237,545	238,463
Gross profit	127,989	104,688	119,463
Operating expenses:
Research and development	4,543	4,363	4,185
Selling and marketing	31,317	34,580	30,769
General and administrative	47,213	47,954	44,437
Total operating expenses	83,073	86,897	79,391
Operating income from continuing operations	44,916	17,791	40,072
Other income/(expense):
Other income/(expense), net	78	228	(129)
Interest income	1,505	1,198	950
Interest expense	(7,484)	(5,683)	(4,822)
Total other income/(expense), net	(5,901)	(4,257)	(4,001)
Income from continuing operations before income taxes	39,015	13,534	36,071
Income tax expense	12,582	5,454	14,088
Income from continuing operations	26,433	8,080	21,983
Discontinued operations (Note 3):
Income/(loss) from operations of discontinued security solutions division	(15,945)	(96,055)	11,279
Income tax expense/(benefit)	(5,617)	(5,206)	752
Income/(loss) from discontinued operations	(10,328)	(90,849)	10,527
Net income/(loss)/comprehensive income/(loss)	$ 16,105	$ (82,769)	$ 32,510
Net income/(loss) per share (Note 2):
Basic--continuing operations	$ 0.41	$ 0.13	$ 0.38
Basic--net income/(loss)	0.25	(1.37)	0.56
Diluted--continuing operations	0.40	0.13	0.37
Diluted--net income/(loss)	$ 0.25	$ (1.30)	$ 0.53
Weighted average number of common shares outstanding (Note 2):
Basic	64,788	60,622	58,195
Diluted	67,277	63,621	65,456

Consolidated Statement of Changes in Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income	Treasury Stock
Beginning Balance, shares at Apr. 30, 2009		48,967				1,200
Beginning Balance at Apr. 30, 2009	$ 48,275	$ 49	$ 90,674	$ (36,125)	$ 73	$ (6,396)
Issuance of common stock in connection with an equity offering, net of costs of $2,418, shares		6,000
Issuance of common stock in connection with an equity offering, net of costs of $2,418	35,017	$ 6	35,011
Exercise of employee stock options, shares		127
Exercise of employee stock options	190		190
Issuance of common stock in connection with acquisition of Smith & Wesson Security Solutions, Inc., net of costs of $12, shares		5,600
Issuance of common stock in connection with acquisition of Smith & Wesson Security Solutions, Inc., net of costs of $12	38,179	$ 6	38,173
Stock-based compensation	3,284		3,284
Book deduction of stock-based compensation in excess of tax deductions	(148)		(148)
Shares issued under employee stock purchase plan, shares		281
Shares issued under employee stock purchase plan	1,042		1,042
Issuance of common stock under restricted stock unit awards, net of shares forfeited for tax obligations, shares		147
Issuance of common stock under restricted stock unit awards, net of shares forfeited for tax obligations	(123)		(123)
Net income/(loss)	32,510			32,510
Ending balance, shares at Apr. 30, 2010		61,122				1,200
Ending balance at Apr. 30, 2010	158,226	$ 61	168,103	(3,615)	73	$ (6,396)
Exercise of employee stock options, shares		90
Exercise of employee stock options	144		144
Issuance of common stock in connection with acquisition of Smith & Wesson Security Solutions, Inc., net of costs of $12, shares		4,080
Issuance of common stock in connection with acquisition of Smith & Wesson Security Solutions, Inc., net of costs of $12	15,178	$ 4	15,174
Stock-based compensation	1,680		1,680
Book deduction of stock-based compensation in excess of tax deductions	(739)		(739)
Shares issued under employee stock purchase plan, shares		351
Shares issued under employee stock purchase plan	1,062	$ 1	1,061
Issuance of common stock under restricted stock unit awards, net of shares forfeited for tax obligations, shares		68
Issuance of common stock under restricted stock unit awards, net of shares forfeited for tax obligations	(50)		(50)
Net income/(loss)	(82,769)			(82,769)
Ending balance, shares at Apr. 30, 2011		65,711				1,200
Ending balance at Apr. 30, 2011	92,732	$ 66	185,373	(86,384)	73	$ (6,396)
Exercise of employee stock options, shares		290
Exercise of employee stock options	628		628
Stock-based compensation	2,484		2,484
Book deduction of stock-based compensation in excess of tax deductions	(144)		(144)
Shares issued under employee stock purchase plan, shares		503
Shares issued under employee stock purchase plan	1,039	$ 1	1,038
Issuance of common stock under restricted stock unit awards, net of shares forfeited for tax obligations, shares		8
Net income/(loss)	16,105			16,105
Ending balance, shares at Apr. 30, 2012		66,512				1,200
Ending balance at Apr. 30, 2012	$ 112,844	$ 67	$ 189,379	$ (70,279)	$ 73	$ (6,396)

Consolidated Statement of Changes in Stockholders' Equity (Parenthetical) $ in Thousands	12 Months Ended
	Apr. 30, 2010 USD ($)
Issuance of common stock net of offering cost	$ 2,418
Acquisition cost	12
Common Stock
Issuance of common stock net of offering cost	2,418
Acquisition cost	12
Additional Paid-In Capital
Issuance of common stock net of offering cost	2,418
Acquisition cost	$ 12

Consolidated Statements of Cash Flows - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Apr. 30, 2012	Apr. 30, 2011	Apr. 30, 2010
Cash flows from operating activities:
Net income/(loss)	$ 16,105	$ (82,769)	$ 32,510
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Amortization and depreciation	16,729	14,935	13,623
Loss on sale of business, including loss on sale of discontinued operations	5,688		0
Loss on sale of assets	324	234	516
(Recoveries of)/provision for losses on accounts receivable	(439)	1,379	(278)
Impairment of long-lived assets		90,503
Deferred income taxes	(1,558)	(480)	6,927
Stock-based compensation expense	2,484	1,680	3,284
Change in contingent consideration		(3,060)	(9,587)
Excess book deduction of stock-based compensation	(144)	(739)	(148)
Changes in operating assets and liabilities:
Accounts receivable	7,803	7,327	(14,872)
Inventories	(7,927)	(995)	(5,024)
Other current assets	1,200	(1,717)	(298)
Income tax receivable /payable	4,804	657	(7,986)
Accounts payable	(8,521)	10,861	3,703
Accrued payroll	3,693	(4,031)	1,357
Accrued taxes other than income	(7,151)	8,892	(169)
Accrued profit sharing	3,959	(3,118)	991
Accrued other expenses	(2,554)	1,510	1,369
Accrued product/municipal liability	(1,187)	(193)	(641)
Accrued warranty	2,181	(341)	(580)
Other assets	1,647	(1,453)	(72)
Other non-current liabilities	714	206	(1,533)
Net cash provided by operating activities	37,850	39,288	23,092
Cash flows from investing activities:
Payments for the purchase of Smith & Wess on Security Solutions , Inc.			(21,074)
Proceeds from sale of business	500
Receipts from note receivable	19
Payments to acquire patents and software	(193)	(562)	(889)
Proceeds from sale of property and equipment	199	53	23
Payments to acquire property and equipment	(14,392)	(20,353)	(16,831)
Net cash used in investing activities	(13,867)	(20,862)	(38,771)
Cash flows from financing activities:
Proceeds from loans and notes payable	1,532	51,365	2,950
Cash paid for debt issue costs	(1,850)	(1,145)	(81)
Proceeds from issuance of common stock, net of issuance costs			35,017
Cash paid for redemption of convertible notes	(30,000)
Payments on loans and notes payable	(1,532)	(51,365)	(23,283)
Proceeds from Economic Development Incentive Program	4,400
Proceeds from energy efficiency incentive programs	225
Proceeds from exercise of options to acquire common stock including employee stock purchase plan	1,667	1,206	1,232
Taxes paid related to restricted stock issuance		(50)	(123)
Net cash (used in)/provided by financing activities	(25,558)	11	15,712
Net (decrease )/increase in cash and cash equivalents	(1,575)	18,437	33
Cash and cash equivalents, beginning of period	58,292	39,855	39,822
Cash and cash equivalents, end of period	56,717	58,292	39,855
Cash paid for:
Interest	5,865	3,820	3,614
Income taxes	3,963	2,146	16,729
Supplemental Disclosure of Non-cash Investing and Financing Activities:
Debt issue costs not paid at year end		$ 1,837
Capital lease obligation	3,281
Shares issued in connection with the acquisition of Smith & Wesson Security Solutions, Inc. (Note 2)		15,178
Acquisition of Smith & Wesson Security Solutions, Inc. (formerly Universal Safety Response, Inc.) (Note 2)
Accounts receivable	(7,803)	$ (7,327)	14,872
Inventories	7,927	995	5,024
Other current assets	(1,200)	1,717	298
Deferred income taxes	(1,558)	(480)	6,927
Other assets	(1,647)	1,453	72
Accounts payable	(8,521)	10,861	3,703
Accrued expenses	(2,554)	1,510	1,369
Income tax receivable	4,804	657	(7,986)
Other non-current liabilities	$ 714	$ 206	(1,533)
Smith And Wesson Security Solutions Inc.
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Deferred income taxes			692
Changes in operating assets and liabilities:
Accounts receivable			(10,077)
Inventories			(3,973)
Other current assets			(704)
Income tax receivable /payable			(26)
Accounts payable			(4,546)
Accrued other expenses			(4,859)
Other assets			(10)
Other non-current liabilities			(7,706)
Acquisition of Smith & Wesson Security Solutions, Inc. (formerly Universal Safety Response, Inc.) (Note 2)
Accounts receivable			10,077
Inventories			3,973
Other current assets			704
Deferred income taxes			692
Property, plant, and equipment			1,315
Intangible assets			95,755
Other assets			10
Accounts payable			(4,546)
Accrued expenses			(4,859)
Income tax receivable			(26)
Other current liabilities			(8,300)
Other non-current liabilities			(7,706)
Contingent Consideration			(27,824)
Cash paid for purchase of Smith & Wesson Security Solutions, Inc., net of cash acquired			(21,074)
Stock paid for purchase of Smith & Wesson Security Solutions, Inc.			$ (38,191)

Organization

12 Months Ended

Apr. 30, 2012

Organization [Abstract]

Organization

1. Organization

Organization — We are one of the world’s leading manufacturers of firearms. We sell our products under the Smith & Wesson brand, the M&P brand, the Thompson/Center brand, and the Walther brand and manufacture a wide array of handguns, modern sporting rifles, hunting rifles, black powder firearms, handcuffs, and firearm-related products and accessories for sale to a wide variety of customers, including gun enthusiasts, collectors, hunters, sportsmen, competitive shooters, individuals desiring home and personal protection, law enforcement and security agencies and officers, and military agencies in the United States and throughout the world. We are one of the largest manufacturers of handguns, modern sporting rifles, and handcuffs in the United States, and an active participant in the hunting rifle market. We manufacture our firearm products at our facilities in Springfield, Massachusetts and Houlton, Maine. In addition, we pursue opportunities to license our name and trademarks to third parties for use in association with their products and services.

Significant Accounting Policies

12 Months Ended

Apr. 30, 2012

Significant Accounting Policies [Abstract]

Significant Accounting Policies

2. Significant Accounting Policies

Use of Estimates — The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the financial statement dates and the reported amounts of revenue and expenses during the reporting periods. Our significant estimates include gross margin and percentage of completion on in-process security solutions projects, accruals for warranty, product liability, workers’ compensation expense, environmental liability, excess and obsolete inventory, allowance for doubtful accounts, income tax expense, forfeiture rates on stock-based awards, asset impairments, medical claims payable, and the loss on the sale of our discontinued operations. Actual results could differ from those estimates.

Principles of Consolidation — The accompanying consolidated financial statements include the accounts of Smith & Wesson Holding Corporation and its wholly owned subsidiaries including, but not limited to, Smith & Wesson Corp., Thompson/Center Arms Company, LLC, and Smith & Wesson Security Solutions, Inc. (“SWSS”). The fiscal year-ends of our wholly owned subsidiaries, Smith & Wesson Corp., and SWSS were April 29, 2012, May 1, 2011, and May 2, 2010, a one-day, one-day, and two-day variance to our reported fiscal year ends of April 30, 2012, 2011, and 2010, respectively. These variances did not create any material difference in the consolidated financial statements as presented. In our opinion, all adjustments, which include only normal recurring adjustments necessary to fairly present the financial position, results of operations, changes in stockholders’ equity, and cash flows at April 30, 2012 and April 30, 2011 and for the periods presented, have been included. All significant intercompany accounts and transactions have been eliminated in consolidation.

SWSS is being presented as discontinued operations in the consolidated statements of operations and comprehensive income/(loss) for all periods presented. See Note 3 for additional information regarding these discontinued operations. Unless stated otherwise, any reference in the notes to the consolidated financial statements refer to results from continuing operations.

On January 3, 2007, we acquired all of the outstanding capital stock of Thompson Center Holding Corporation (formerly Bear Lake Acquisition Corp.) and its subsidiaries (collectively “Thompson/Center Arms”), including Thompson/Center Arms Company, Inc. (now Thompson/Center Arms Company, LLC) (“TCA”). During fiscal 2012, we merged Thompson Center Holding Corporation into Smith & Wesson Corp.

Fair Value of Financial Instruments — Unless otherwise indicated, the fair values of all reported assets and liabilities, which represent financial instruments not held for trading purposes, approximate the carrying values of such amounts because of their short-term nature or market rates of interest.

Derivative Instruments — We account for derivative instruments under Accounting Standards Codification (“ASC”) 815-10, Fair Value Measurements and Disclosure Topic, which establishes accounting and reporting standards for derivative instruments and hedging activities and requires us to recognize these instruments as either assets or liabilities on the balance sheet and measure them at fair value. At times, we have purchased foreign exchange forward contracts to minimize the impact of fluctuations in foreign exchange rates (see Note 14). As of April 30, 2012 and 2011, we had no foreign exchange forward contracts outstanding.

Cash and Cash Equivalents — We consider all highly liquid investments purchased with original maturities of three months or less at the date of acquisition to be cash equivalents. We maintain our cash in bank deposit accounts that, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. As of April 30, 2012, our accounts exceeded federally insured limits by $56.2 million.

Trade Receivables — We extend credit to our domestic customers and some foreign firearm distributors based on their financial condition. We offer discounts for early payment on firearm invoices. When we believe the extension of credit is not advisable, we rely on either a prepayment or a letter of credit. We place past due balances for collection with an outside agency after 90 days if there has been no good faith effort on the part of the customer to bring its account current. We write off balances deemed uncollectible by us against our allowance for doubtful accounts. We estimate our allowance for doubtful accounts through current past due balances, knowledge of our customers’ financial situations, and past payment history.

Concentrations of Credit Risk — Financial instruments that potentially subject us to concentration of credit risk consist principally of cash, cash equivalents, and trade receivables. We place our cash and cash equivalents in overnight U.S. government securities. Concentrations of credit risk with respect to trade receivables are limited by the large number of customers comprising our customer base and their geographic and business dispersion. We perform ongoing credit evaluations of our customers’ financial condition and generally do not require collateral.

One customer accounted for approximately 12.2%, 11.5%, and 10.7% of our net product sales for the fiscal years ended April 30, 2012, 2011, and 2010, respectively. This customer accounted for approximately $5.6 million, or 11.7% of total accounts receivable, as of April 30, 2012. In addition, there was one other customer that accounted for $5.1 million, or 10.7%, of total accounts receivable as of April 30, 2012.

Inventories — We value firearm inventories, consisting primarily of finished firearm components, finished firearms, and related products and accessories, and discontinued security solutions inventory, consisting primarily of mechanical and electrical components required for installation of products, at the lower of cost, using the first-in, first-out (FIFO) method, or market. An allowance for potential non-saleable inventory due to excess stock or obsolescence is based upon a detailed review of inventory components, past history, and expected future usage.

Property, Plant, and Equipment — We record property, plant, and equipment, consisting of land, building, building improvements, machinery, equipment, computers, furniture, and fixtures, at cost and depreciate them using the straight-line method over their estimated useful lives. We charge expenditures for maintenance and repairs to earnings as incurred, and we capitalize additions, renewals, and betterments. Upon the retirement or other disposition of property and equipment, we remove the related cost and accumulated depreciation from the respective accounts and include any gain or loss in operations. A summary of the estimated useful lives is as follows:


Description	Useful Life
Building and improvements		10 to 40 years
Machinery and equipment		2 to 10 years

We capitalize tooling, dies, and fixtures as part of machinery and equipment and depreciate them over a period not exceeding five years.

Intangible Assets — We amortize intangible assets over their estimated useful lives, which range from eight to 20 years. See Note 10 for additional information regarding intangible assets.

Revenue Recognition — For our firearm products, we recognize revenue when the following four basic criteria have been met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been provided; (3) the fee is fixed or determinable; and (4) collection is reasonably assured. For our discontinued security solutions products and services, we recognize revenue from fixed-price contracts using the percentage-of-completion method, measured by the percentage of costs incurred to date to our total costs for each contract. Revenue from our security solutions business has been reclassified as discontinued operations.

Product sales account for a substantial portion of our firearm revenue. We recognize revenue from firearm product sales when the earnings process is complete and the risks and rewards of ownership have transferred to the customer, which is generally upon shipment. We also provide tooling, forging, heat treating, finishing, plating, and engineering support services to customers; we recognize this revenue when accepted by the customer, when no further contingencies or material performance obligations exist, and when collectibility is reasonably assured, thereby earning us the right to receive and retain payments for services performed and billed.

We determine percentage-of-completion by comparing the cost incurred to date to the estimated total cost required to complete the project. We consider costs incurred to date to be the most reliable, available measure of progress on these projects. We make adjustments to estimates to complete in the periods in which facts resulting in a change become known. When the estimate indicates that a loss will be incurred, we record the loss in the period in which it is identified. When reliable estimates cannot be made, we recognize revenue upon completion. Significant judgment is involved in the estimation process for each contract. Different assumptions could yield materially different results. Delays in the installation process could negatively affect operations in a given period by increasing volatility in revenue recognition. Recognition of revenue in conformity with accounting principles generally accepted in the United States requires us to make judgments that affect the timing and amount of reported revenue.

We recognize trademark licensing revenue for individual licensees on a quarterly basis based on historical experience and expected cash receipts from licensees. Licensing revenue consists of minimum royalties and/or a percentage of a licensee’s sales on licensed products. Under our current licensing agreements, this revenue is payable on a calendar quarter basis. We recognize non-refundable license fees received upon initial signing of license agreements as revenue when no future obligation is required on our part. As a result of a combination of uncertain factors regarding existing licensees, including current and past payment performance, market acceptance of the licensees’ products, and insufficient historical experience, we believe that reasonable assurance of collectability does not exist based on the results and past payment performance of licensees in general. Therefore, we do not recognize minimum royalty payments upon contract signing, but instead record royalty revenue monthly when the minimum royalty can be reasonably estimated for that month and payment is assured. As of April 30, 2012, minimum royalties to be collected in the future amounted to approximately $2.2 million as follows (dollars in thousands):


	Minimum
For the Year Ended April 30,	Royalty
2013	$	872
2014		808
2015		452
2016		100

Total minimum royalties	$	2,232

Segment Information — We have historically reported certain financial information under two segments: firearms and security solutions. As a result of our plan to divest SWSS, the results of the operations comprising the security solutions segment are now being reported as discontinued operations for all periods presented. See Note 3—Discontinued Operations for additional information.

Geographic Information — During April 30, 2012, 2011, and 2010, we had no material personnel or facilities outside of the United States. Sales outside of the United States are detailed in Note 6.

Research and Development — We engage in both internal and external research and development (“R&D”) in order to remain competitive and to exploit possible untapped market opportunities. Executive management approves prospective R&D projects after analysis of the cost and benefits associated with the potential product. Costs in R&D expense include, among other items, salaries, materials, utilities, and administrative costs.

Earnings/(Loss) per Share — We calculate basic and diluted earnings/(loss) per common share in accordance with the provisions of ASC 260-10, Earnings Per Share. Basic earnings/(loss) per common share equals net income/(loss) divided by the weighted average number of common shares outstanding during the period. Diluted earnings/(loss) per common share equals net income/(loss) divided by the weighted average number of common shares outstanding during the period, including the effect of outstanding stock options and other stock-based instruments, if their effect is dilutive.

The following table provides a reconciliation of the net income/(loss) amounts and weighted average number of common and common equivalent shares used to determine basic and diluted earnings/(loss) per common share (in thousands, except per share data):


	For the year ended April 30,
	2012			2011			2010
Net income/(loss)
Income from continuing operations	$	26,433		$	8,080		$	21,983
Income/(loss) from discontinued operations, net of tax		(10,328	)		(90,849	)		10,527

Net income/(loss)	$	16,105		$	(82,769	)	$	32,510

Weighted average shares outstanding—Basic		64,788			60,622			58,195
Dilutive effect of stock option and award plans		965			2,999			776
Dilutive effect of conversion of convertible debt		1,524			—			6,485

Diluted shares outstanding		67,277			63,621			65,456

Earnings per common share—Basic
Income from continuing operations	$	0.41		$	0.13		$	0.38
Income/(loss) from discontinued operations	$	(0.16	)	$	(1.50	)	$	0.18
Net income/(loss)	$	0.25		$	(1.37	)	$	0.56
Earnings per common share—Diluted (a)
Income from continuing operations	$	0.40		$	0.13		$	0.37
Income/(loss) from discontinued operations	$	(0.15	)	$	(1.43	)	$	0.19
Net income/(loss)	$	0.25		$	(1.30	)	$	0.53

(a)	Included in the calculation for diluted earnings per common share for the years ended April 30, 2012 and 2010, is $499,000 and $2.2 million, respectively, of diluted earnings related to the effect of conversion of convertible debt.

For fiscal 2012, 952,483 shares of common stock issuable upon the exercise of stock options were excluded from the computation of diluted income per share because the effect would be antidilutive. For fiscal 2011, 5,515,877 shares of common stock issuable upon conversion of the Convertible Notes (as defined below), 2,345,422 shares of common stock reserved for issuance to the former stockholders of SWSS through date of issuance, and 1,598,124 shares of common stock issuable upon the exercise of stock options were excluded from the computation of diluted loss per share because the effect would be antidilutive. For fiscal 2010, 691,553 shares of common stock issuable upon the exercise of stock options were excluded from the computation of diluted income per share because the effect would be antidilutive.

Valuation of Long-lived Tangible and Intangible Assets— We evaluate the recoverability of long-lived assets, or asset groups, whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. When such evaluations indicate that the related future undiscounted cash flows are not sufficient to recover the carrying values of the assets, such carrying values are reduced to fair value and this adjusted carrying value becomes the asset’s new cost basis. We determine fair value primarily using future anticipated cash flows that are directly associated with and that are expected to arise as a direct result of the use and eventual disposition of the asset, or asset group, discounted using an interest rate commensurate with the risk involved.

We have significant long-lived tangible and intangible assets, which are susceptible to valuation adjustments as a result of changes in various factors or conditions. The most significant long-lived tangible and intangible assets are fixed assets, developed technology, patents, trademarks, and tradenames. We amortize all finite-lived intangible assets either on a straight-line basis or based upon patterns in which we expect to utilize the economic benefits of such assets. With the exception of goodwill and intangible assets with indefinite lives, we initially determine the values of intangible assets by a risk-adjusted, discounted cash flow approach. We assess the potential impairment of identifiable intangible assets and fixed assets whenever events or changes in circumstances indicate that the carrying values may not be recoverable and at least annually. Factors we consider important, which could trigger an impairment of such assets, include the following:

•

significant underperformance relative to historical or projected future operating results;

•

significant changes in the manner or use of the assets or the strategy for our overall business;

•

significant negative industry or economic trends;

•

significant decline in our stock price for a sustained period; and

•

a decline in our market capitalization below net book value.

Future adverse changes in these or other unforeseeable factors could result in an impairment charge that would materially impact future results of operations and financial position in the reporting period identified.

In accordance with ASC 350, Intangibles-Goodwill and Other, we test intangible assets with indefinite lives for impairment on an annual basis on February 1 and between annual tests if indicators of potential impairment exist. The impairment test compares the fair value of the reporting unit to its carrying amount, including intangible assets with indefinite lives, to assess whether impairment is present. We have reviewed the provisions of ASC 280-10, Segment Reporting Topic, with respect to the criteria necessary to evaluate the number of reporting units that exist. Based on our review of ASC 280-10-50, we have determined that we operate our continuing operations in one reporting unit for our Springfield, Massachusetts and Houlton, Maine facilities. As of April 30, 2012, we had no goodwill recorded on our books for continuing operations.

Based on a combination of factors that occurred during fiscal 2011, including federal and corporate budgetary constraints, increased price competition, low barrier to entry, and other factors, we determined that indicators for impairment of goodwill and intangible assets existed in our discontinued security solutions division and, as a result, we conducted an evaluation of goodwill and intangible assets associated with the acquisition of that business. Based on the earnings and cash flow forecast for the next 10 years, the fair value of this reporting unit was estimated using the expected present value of future cash flows. Based on the work performed, we recorded a goodwill impairment loss of $83.9 million in fiscal 2011, which is included in the results of discontinued operations on our consolidated statements of operations and comprehensive income/(loss).

We periodically review long-lived assets for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of those assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted cash flows to the recorded carrying value for the asset. If impairment is indicated, the asset is written down to its estimated fair value based on a discounted cash flow analysis. As noted above, economic and market conditions that affected our discontinued security solutions division required us to test for impairment of long-lived assets pertaining to that business in fiscal 2011. Based on that assessment, we recorded an impairment charge of $6.6 million, included in the results of discontinued operations on our consolidated statements of operations and comprehensive income/(loss), to reflect the excess of the carrying value of long-lived intangible assets over the discounted cash flows. See Note 3—Discontinued Operations for additional information. See also Note 10—Intangible Assets. No impairment charges were taken for continuing operations in fiscal 2012, 2011, or 2010 based on the review of long-lived assets.

We utilize an income approach, with discounted cash flows, to estimate the fair value of each reporting unit. We selected this method because we believe that it most appropriately measures our income producing assets. We considered using the market approach and the cost approach, but concluded that they were not appropriate in valuing our reporting units given the lack of relevant and available market comparisons. The income approach is based on the projected cash flows that are discounted to their present value using discount rates that consider the timing and risk of the forecasted cash flows. We believe that this approach is appropriate because it provides a fair value estimate based upon the reporting unit’s expected long-term operating cash performance. This approach also mitigates the impact of the cyclical trends that occur in our industry. Fair value is estimated using internally-developed forecasts and assumptions. The discount rate used is the average estimated value of a market participant’s cost of capital and debt, derived using customary market metrics. Other significant assumptions include terminal value margin rates, future capital expenditures, and changes in future working capital requirements. We also compare and reconcile our overall fair value to our market capitalization. While there are inherent uncertainties related to the assumptions used and to our application of these assumptions to this analysis, we believe that the income approach provides a reasonable estimate of the fair value of our reporting units. The foregoing assumptions were consistent with our long-term performance, with limited exceptions. We believe that our future investments for capital expenditures as a percent of revenue will decline in future years due to our improved utilization resulting from lean initiatives, and we believe that days sales outstanding will decline with any increase in revenues. We also have assumed that through the current economic downturn, our markets have not contracted for the long term; however, it may be a number of years before they fully recover. These assumptions could deviate materially from actual results.

Significant judgments and estimates are involved in determining the useful lives of our long-lived assets, determining what reporting units exist, and assessing when events or circumstances would require an interim impairment analysis of goodwill or other long-lived assets to be performed. Changes in our organization or our management reporting structure, as well as other events and circumstances, including technological advances, increased competition, and changing economic or market conditions, could result in (a) shorter estimated useful lives, (b) additional reporting units, which may require alternative methods of estimating fair values or greater disaggregation or aggregation in our analysis by reporting unit, and (c) other changes in previous assumptions or estimates. A change in the weighted average cost of capital, for example, could materially change the valuation and, if increased, could cause an impairment. In turn, this could have an additional impact on our consolidated financial statements through accelerated amortization and impairment charges.

Accounting for Acquisitions —Our accounting for acquisitions involves significant judgments and estimates, including the fair value of certain forms of consideration; the fair value of acquired intangible assets, which involve projections of future revenue and cash flows; the fair value of other acquired assets and assumed liabilities, including potential contingencies; and the useful lives and, as applicable, the reporting unit, of the assets. Our financial position or results of operations may be materially impacted by changes in our initial assumptions and estimates relating to prior or future acquisitions. Additionally, we determine the fair value of the reporting unit, for purposes of the first step in our annual goodwill impairment test, based on an income approach. If prior or future acquisitions are not accretive to our results of operations as expected or our market value declines dramatically, we may be required to complete the second step, which requires significant judgments and estimates and which may result in material impairment charges in the period in which they are determined.

Income Taxes — The provision for income taxes is based upon income reported in the accompanying consolidated financial statements. Deferred income taxes reflect the impact of temporary differences between the amounts of assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes. We measure these deferred taxes by applying tax rates expected to be in place when the deferred items become subject to income tax or deductible for income tax purposes.

Stock Options and Other Awards— As described in Notes 16 and 17, we have an incentive stock plan under which employees and directors receive options to purchase our common stock or other stock-based awards, including stock options, restricted stock units (“RSUs”), and performance-based restricted stock units (“PSUs”).

Municipal and Product Liability — We provide reserves for municipal and potential product liability defense costs based on estimates determined in consultation with litigation counsel. We evaluate adjustments to the provision for municipal and product liability on an on-going basis and charge or credit them to cost of sales, exclusive of any insurance reimbursements. We make this evaluation based upon information regarding potential and existing product liability cases. We record any future costs as a result of this evaluation when considered both probable and reasonably estimable. Certain municipal and product liability costs are subject to reimbursement by insurance carriers.

Environmental Liability — We have provided reserves, on an undiscounted basis, for potential environmental obligations that we consider probable and for which reasonable estimates of such obligations can be made. We consider environmental liabilities probable based upon specific facts and circumstances, including currently available environmental studies, existing technology, currently enacted laws and regulations, the timing of future expenditures, experience in remediation efforts, direction or approval from regulatory agencies, our status as a potentially responsible party (“PRP”), and the ability of other PRPs or contractually liable parties, if any, to pay the allocated portion of any environmental obligations. We believe that we have adequately reserved for the reasonable estimable costs of known environmental obligations. We review reserves and may make additions or deletions to the reserves as a result of the specific facts and circumstances previously noted.

The environmental reserve decreased for the fiscal year ended April 30, 2012 by $29,000. During fiscal years ended April 30, 2011 and 2010, the reserve increased by $1.5 million and $0, respectively. On March 30, 2012, we entered into a purchase and sale agreement for the land and building located in Rochester, New Hampshire, pursuant to which we agreed to indemnify the buyer for losses arising from, among other things, environmental conditions related to Thompson/Center Arms’ manufacturing activities. Subsequent to the release of the escrow related to the Rochester, New Hampshire facility, we established a reserve against assets held for sale on our consolidated balance sheet, relating to environmental testing and remediation for that facility of $1.5 million (see Note 19).

Warranty — We generally provide a lifetime warranty to the original purchaser of our new firearm products and provide warranties for up to two years on the materials and workmanship in our security solutions projects, which includes products purchased by us from third-party manufacturers. We provide for estimated warranty obligations in the period in which we recognize the related revenue. We quantify and record an estimate for warranty-related costs based on our actual historical claims experience and current repair costs. We make adjustments to accruals as warranty claims data and historical experience warrant. Should we experience actual claims and repair costs that are higher than the estimated claims and repair costs used to calculate the provision, our operating results for the period or periods in which such returns or additional costs materialize would be adversely impacted.

On November 11, 2011, we initiated a recall of all Thompson/Center Arms Venture ^TM rifles manufactured since the product’s introduction in mid-2009. As of April 30, 2012, we had incurred $512,000 in recall costs and we estimate the remaining cost of this recall will be $1.0 million, which is included in the accrued warranty balance. Warranty expense for the fiscal years ended April 30, 2012, 2011, and 2010 amounted to $6.3 million, $3.5 million, and $3.0 million, respectively.

The following table sets forth the change in accrued warranties, a portion of which is recorded as a non-current liability, in the fiscal years ended April 30, 2012, 2011, and 2010 (dollars in thousands):


	For the Years Ended April 30,
	2012			2011			2010
Beginning Balance	$	4,213		$	4,588		$	5,334
Liabilities assumed in the acquisition of SWSS		—			—			58
Liabilities transferred to held for sale (Note 3)		(256	)		—			—
Warranties issued and adjustments to provisions		6,328			3,534			3,004
Warranty claims		(3,873	)		(3,909	)		(3,808	)

Ending Balance	$	6,412		$	4,213		$	4,588

Sales and Promotional Related Expenses — We present product sales in our consolidated financial statements, net of customer promotional program costs that depend upon the volume of sales, which amounted to $2.7 million, $10.5 million, and $9.2 million for the fiscal years ended April 30, 2012, 2011, and 2010, respectively. We have a co-op advertising program at the retail level. We expensed costs amounting to $1.7 million, $2.0 million, and $1.7 million in fiscal 2012, 2011, and 2010, respectively, as selling and marketing expenses.

Shipping and Handling — In the accompanying consolidated financial statements, we included amounts billed to customers for shipping and handling in net product and services sales. We included our costs relating to shipping and handling charges in cost of products and services sold.

Insurance Reserves — We are self-insured through retentions or deductibles for the majority of our workers’ compensation, automobile, general liability, product liability, and group health insurance programs. Self-insurance amounts vary up to $2.0 million per occurrence. We record our liability for estimated premiums and incurred losses in the accompanying consolidated financial statements on an undiscounted basis.

Recently Issued Accounting Standards — In June 2011, the Financial Accounting Standards Board (the “FASB”) issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. The amendments in this ASU require an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of equity. ASU 2011-05 is effective for interim and annual periods beginning after December 15, 2011. In December 2011, the FASB issued ASU 2011-12, Deferral of the Effective Date for Amendments to the Presentation of Reclassifications of Items Out of Accumulated Other Comprehensive Income in ASU 2011-05. ASU 2011-12 indefinitely defers certain reclassification adjustment provisions of ASU 2011-05. ASU 2011-12 is also effective for interim and annual periods beginning after December 15, 2011. These ASUs do not have a material impact on our consolidated financial statements as we already present comprehensive income/(loss) in our consolidated statements of operations and comprehensive income/(loss).

Discontinued Operations

12 Months Ended

Apr. 30, 2012

Discontinued Operations [Abstract]

Discontinued Operations

3. Discontinued Operations

During fiscal 2010, we acquired all of the outstanding capital stock of SWSS. The initial purchase price was $59.3 million, which consisted of $21.1 million in cash and $38.2 million in common stock paid at closing. In addition, the former stockholders of SWSS had the right to earn up to 4,080,000 additional shares of our common stock if SWSS achieved certain EBITDAS (earnings before interest, taxes, depreciation, amortization, and stock-based compensation expense, excluding large non-recurring items) targets, as defined, in calendar years 2009 and 2010. As of the closing date of the acquisition, this contingent consideration was assigned a fair value of $27.8 million. This valuation was established in accordance with ASC 805-20-25-20, Business Combinations Topic. Based on SWSS’s actual calendar year 2009 results, no additional shares were earned or paid for calendar 2009 results as EBITDAS for that period was below the $8.0 million threshold to achieve a distribution. On August 19, 2010, we entered into a waiver and amendment to the merger agreement to waive the achievement of the EBITDAS target for the 2010 calendar year as a condition to the issuance of the 4,080,000 earn-out shares, and instead agreed to issue the 4,080,000 shares to the former stockholders of SWSS on March 18, 2011. Effective August 19, 2010, this liability was adjusted to the fair value of $15.2 million and reclassified to equity. The $3.1 million and $9.6 million in income associated with the reduction in the contingent consideration during the years ended April 30, 2011 and 2010, respectively, has been recorded in other income in discontinued operations as noted below.

Based on a combination of factors occurring since our July 2009 acquisition of SWSS, including federal and corporate budgetary constraints, increased price competition, and a fundamental change in strategic direction, on October 5, 2011, we committed to a plan to divest the assets, liabilities, and ongoing operations of our security solutions division. We have presented the assets and liabilities on a separate line as assets and liabilities held for sale on our consolidated balance sheets and the operating results of SWSS are classified as discontinued operations and are presented in a separate line in the consolidated statements of operations and comprehensive income/(loss) for all periods presented. While implementing our plan to divest SWSS, we have determined the fair value of the business to be the market value of the business, less transaction costs. Based on this evaluation, we have recorded a loss on sale of the disposal group of $5.5 million, which is included in the loss from discontinued operations, and is made up of $1.2 million of property, plant, and equipment, $3.2 million of intangible assets, and the remainder being applied to inventory. Prior to the decision to divest the business, we had reported SWSS as a separate segment under the heading of security solutions.

The following is a summary of the operating results of the discontinued operations (dollars in thousands):


	For the Year Ended April 30,
	2012			2011			2010
Net sales from discontinued operations	$	30,752		$	50,067		$	48,250
(Loss)/income before income taxes	$	(15,945	)	$	(96,055	)	$	11,279
(Loss)/income from discontinued operations (a)	$	(10,328	)	$	(90,849	)	$	10,527

(a)

Included in the results of operations for fiscal 2012 are $5.5 million of non-cash charges related to the loss on sale of disposal group from the divestiture of our discontinued security solutions division. Included in the results of operations for fiscal 2011 are non-cash charges related to the impairment of goodwill and other intangible assets totaling $90.5 million. In addition, for fiscal 2011, we recorded income of $3.1 million related to the reduction in the acquisition liability related to contingent consideration versus the value recorded as of April 30, 2010. In addition, the results of operations for fiscal 2010 include $9.6 million of income related to the reduction in the acquisition liability related to the contingent consideration versus the value recorded from the July 2009 purchase.

The net assets and liabilities qualify as assets and liabilities held for sale because we plan to complete the divestiture within the next 12 months. The following is a summary of assets and liabilities included in our consolidated balance sheets that have been classified as assets held for sale and liabilities held for sale (dollars in thousands):


	April 30, 2012
ASSETS
Current assets:
Accounts receivable, net of allowance for doubtful accounts	$	9,076
Inventories		2,808
Other current assets		547

Total current assets		12,431
Other assets		12

	$	12,443

LIABILITIES
Current liabilities:
Accounts payable	$	2,980
Accrued expenses		2,457
Accrued warranty		256

Total current liabilities		5,693

Total liabilities	$	5,693

Included in our consolidated balance sheet as of April 30, 2011, there was $11.8 million in accounts receivable, $5.1 million in inventory, $797,000 in other current assets, $1.6 million in property, plant, and equipment, $3.7 million in intangibles, $2.8 million in accounts payable, $2.3 million in accrued expenses, and $244,000 in accrued warranty related to our discontinued operations.

We also have recorded $1.0 million related to the land and building located in Rochester, New Hampshire and related environmental remediation in assets held for sale on our consolidated balance sheets. See Notes 13 and 20 for further details related to environmental remediation.

- Definition

The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 144
-Paragraph 43-48
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

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-Publisher FASB
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Reference 10: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Standards Codification
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+ Details

Notes Payable and Financing Arrangements

12 Months Ended

Apr. 30, 2012

Notes Payable and Financing Arrangements [Abstract]

Notes Payable and Financing Arrangements

4. Notes Payable and Financing Arrangements

Credit Facilities —Pursuant to an amended and restated credit agreement dated December 7, 2010, we increased our revolving line of credit to $120.0 million, removed the accounts receivable and inventory borrowing base limitations, and extended the agreement to December 7, 2014. Pursuant to an amendment of our amended and restated credit agreement dated October 28, 2011, we decreased our revolving line of credit to $60.0 million. As a result of the reduction of our credit facility, we wrote off $563,000 of debt issuance costs to interest expense during fiscal 2012.

The credit facility provides for availability until December 7, 2014 for working capital needs. The revolving line of credit bears interest at a variable rate equal to LIBOR or prime plus an applicable margin based on our leverage ratio, at our election. As of April 30, 2012, there were no borrowings outstanding. Had there been borrowings, they would have borne an interest rate of 5.0% per annum.

As security for the credit facility, TD Bank has a first priority lien on all of our personal property and real estate assets.

We may prepay, in whole or in part, any of the loans that have interest rates determined by reference to the prime rate, with interest accrued to the date of the prepayment on the amount prepaid, without any penalty or premium. Loans with a fixed rate of interest determined by reference to the LIBOR interest rate may be prepaid provided that we reimburse TD Bank, N.A. (“TD Bank”) for any costs associated with (i) our making payments on dates other than those specified in the credit agreement, or (ii) our borrowing or converting a LIBOR loan on a date other than the borrowing or conversion dates specified in the credit agreement.

Convertible Notes — On December 15, 2006, we issued an aggregate of $80.0 million of 4% senior convertible notes (the “Convertible Notes”) maturing on December 15, 2026 to qualified institutional buyers pursuant to the terms and conditions of a securities purchase agreement and indenture. In fiscal 2011, we exchanged a total of $50.0 million of Convertible Notes for $50.0 million of Senior Notes (as defined below). On December 15, 2011, holders of Convertible Notes required us to repurchase $29.7 million of Convertible Notes and on January 21, 2012, we redeemed the remaining $334,000 of Convertible Notes utilizing cash on hand. As of April 30, 2012, there were no outstanding Convertible Notes.

Senior Notes — During fiscal 2011, we issued an aggregate of $50.0 million of 9.5% senior notes due 2016 (“Senior Notes”) in exchange for $50.0 million of Convertible Notes pursuant to the terms and conditions of an exchange agreement and indenture (the “Senior Notes Indenture”).

In fiscal 2011, we evaluated these exchanges as a modification event under ASC 470-60, Troubled Debt Restructurings by Debtors. Because we are not experiencing financial difficulties, the exchanges were not accounted for as troubled debt restructuring. Consequently, we evaluated each exchange under ASC 470-50, Debtor’s Accounting for a Modification or Exchange of Debt Instruments to determine if the modification was substantial. Because the conversion feature was removed in the exchange, the debt modification was determined to be substantial and, accordingly, the exchanged Convertible Notes were extinguished. The fair value of the Senior Notes was equal to the carrying value of the exchanged Convertible Notes; therefore, no gain or loss on extinguishment was recorded. During fiscal 2011, in accordance with ASC 470-50, we amortized $476,000 of deferred financing costs associated with the extinguishment to interest expense.

The Senior Notes bear interest at a rate of 9.5% per annum payable on June 15 and December 15 of each year.

At any time prior to January 14, 2014, we may, at our option, (a) redeem all or a portion of the Senior Notes at a redemption price of 100% of the principal amount of the Senior Notes, plus an applicable premium, plus accrued and unpaid interest as of the redemption date, or (b) redeem up to 35% of the aggregate principal amount of the Senior Notes with the net cash proceeds of one or more equity offerings at a redemption price of 104.75% of the principal amount of the Senior Notes, plus accrued and unpaid interest as of the redemption date; provided that in the case of clause (b) above, at least 65% of the aggregate original principal amount of the Senior Notes remains outstanding and the redemption occurs within 60 days after the closing of the equity offering. On and after January 14, 2014, we may, at our option, redeem all or a portion of the Senior Notes at a redemption price of (1) 104.75% of the principal amount of the Senior Notes to be redeemed, if redeemed during the 12-month period beginning on January 14, 2014; or (2) 100% of the principal amount of the Senior Notes to be redeemed, if redeemed during the 12-month period beginning on January 14, 2015, plus, in either case, accrued and unpaid interest on the Senior Notes as of the applicable redemption date. Subject to certain restrictions and conditions, we may be required to make an offer to repurchase the Senior Notes from the holders of the Senior Notes in connection with a change of control or disposition of assets. If not redeemed by us or repaid pursuant to the holders’ right to require repurchase, the Senior Notes mature on January 14, 2016. During May and June 2012, we purchased a total of $6.4 million of our Senior Notes utilizing cash on hand. We paid $550,000 of interest premium relating to these purchases.

The Senior Notes are general unsecured obligations of our company. The Senior Notes Indenture contains certain affirmative and negative covenants, including limitations on restricted payments, limitations on indebtedness, limitations on the sale of assets, and limitations on liens.

The limitation on indebtedness in the Senior Notes Indenture is only applicable at such time that the consolidated coverage ratio (as set forth in the Senior Notes Indenture) for us and our restricted subsidiaries is less than 2.00 to 1.00. In general, as set forth in the Senior Notes Indenture, the consolidated coverage ratio is determined by comparing our prior four quarters’ consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) to our consolidated interest expense.

Debt Issuance Costs — Debt issuance costs related to the TD Bank credit facility, including all related refinancings, amounted to $2.2 million and were recorded in other assets. These costs are being amortized to expense over the life of the credit facility using the straight-line method. For the fiscal year ended April 30, 2012, we amortized a total of $837,000 to interest expense, including the $563,000 of debt issuance costs we wrote off in connection with reducing our credit facility.

We incurred $4.3 million of debt issuance costs associated with the issuance of the Convertible Notes. We amortized these costs on a straight-line basis, which approximates the effective interest rate method, through December 15, 2011, the date of the first redemption. As noted above, we repurchased $30.0 million of Convertible Notes during fiscal 2012. For fiscal 2011, the exchange of Convertible Notes for Senior Notes discussed above resulted in increased amortization expense of $476,000, as noted above. For the fiscal year ended April 30, 2012, we amortized $204,000 to interest expense.

We incurred $1.8 million of debt issuance costs associated with the issuance of the Senior Notes. These costs are being amortized on a straight-line basis, which approximates the effective interest rate method, through January 14, 2016, the date of maturity. For the fiscal year ended April 30, 2012, we amortized $361,000 to interest expense.

The total amount amortized to interest expense for all debt issuance costs in fiscal 2012, 2011, and 2010 was $1.4 million, $1.5 million, and $1.1 million, respectively, including write-offs related to extinguishment. Future amortization of debt issuance costs is as follows: fiscal 2013 is $560,000; fiscal 2014 is $541,000; fiscal 2015 is $464,000; and fiscal 2016 is $242,000.

The carrying amounts of notes payable as of April 30, 2012 and 2011 were as follows (dollars in thousands):


	April 30, 2012		April 30, 2011
Current portion of long-term debt:
20-year, $80,000 convertible notes	$	—	$	30,000

Total current portion	$	—	$	30,000

Non-current portion of long-term debt:
5-year, $50,000 term notes	$	50,000	$	50,000

Total non-current portion	$	50,000	$	50,000

The TD Bank credit facility contains financial covenants relating to maintaining maximum leverage and minimum debt service coverage. The Senior Notes Indenture contains a financial covenant relating to times interest earned. We were in compliance with these debt covenants as of April 30, 2012.

Letters of Credit — At April 30, 2012, we had outstanding letters of credit aggregating $1.2 million.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References + Details

Capital Lease

12 Months Ended

Apr. 30, 2012

Capital Lease [Abstract]

Capital Lease

5. Capital Lease

On October 28, 2011, we entered into a sale-leaseback agreement that included the sale of certain machinery and equipment. We then leased a total of $3.5 million of machinery and equipment to increase production capacity. The lease has an effective interest rate of 5.76% and is payable in 60 monthly installments through fiscal 2017. Leases are accounted for under the provisions of ASC 840-10, Leases, which requires that leases be evaluated and classified as operating or capital leases for financial reporting purposes. Based on our evaluation under ASC 840-10, we determined that the lease qualifies as a capital lease because the net present value of future lease payments exceed 90% of the fair market value of the leased machinery and equipment. We have pledged the assets financed to secure the amounts outstanding. We included $418,000 of short-term capital lease obligation in accrued expenses and $2.9 million in other non-current liabilities.

The following sets forth the future minimum lease payments as of April 30, 2012 (dollars in thousands):


	Capital Lease Obligation
2013	$	596
2014		596
2015		596
2016		596
2017		1,494

Total future minimum lease payments		3,878
Less amounts representing interest		(597	)
Present value of minimum lease payments		3,281
Less current maturities of capital lease		(418	)

Long-term maturities of capital lease	$	2,863

International Sales

12 Months Ended

Apr. 30, 2012

International Sales [Abstract]

International Sales

6. International Sales

We sell our products worldwide. The following table sets forth the breakdown of export sales, which accounted for 4%, 5%, and 8% of net sales for the fiscal years ended April 30, 2012, 2011, and 2010, respectively (dollars in thousands):


	For the Year Ended April 30,
Region	2012		2011		2010
Europe	$	5,850	$	4,421	$	4,011
Asia		4,706		5,970		13,634
Latin America		1,904		1,845		3,825
All others international		4,154		6,563		5,434

Total net international sales	$	16,614	$	18,799	$	26,904

No individual foreign country accounted for more than 10% of net sales.

Advertising Costs

12 Months Ended

Apr. 30, 2012

Advertising Costs [Abstract]

Advertising Costs

7. Advertising Costs

We expense advertising costs, primarily consisting of magazine advertisements, printed materials, and television advertisements, either as incurred or when the first time the advertising takes place. For the fiscal years ended April 30, 2012, 2011, and 2010, advertising expenses, included in selling and marketing expenses, amounted to $14.7 million, $15.1 million, and $13.9 million, respectively.

Property, Plant, and Equipment

12 Months Ended

Apr. 30, 2012

Property, Plant, and Equipment [Abstract]

Property, Plant, and Equipment

8. Property, Plant, and Equipment

The following table summarizes property, plant, and equipment as of April 30, 2012 and 2011 (dollars in thousands):


	April 30, 2012			April 30, 2011
Machinery and equipment	$	111,164		$	99,073
Building and improvements		7,453			9,737
Land and improvements		1,362			2,348

		119,979			111,158
Less: Accumulated depreciation		(60,852	)		(51,462	)

		59,127			59,696
Construction in progress		1,401			2,694

Total property, plant, and equipment, net	$	60,528		$	62,390

Estimated cost to complete construction in progress is $4.1 million.

Depreciation expense from continuing operations amounted to $13.4 million, $11.1 million, and $9.5 million for the fiscal years ended April 30, 2012, 2011, and 2010, respectively.

The following table summarizes depreciation and amortization expense for continuing operations, which includes amortization of intangibles and debt financing costs, by line item for the fiscal years ended April 30, 2012, 2011, and 2010 (dollars in thousands):


	For the Year Ended April 30,
	2012		2011		2010
Cost of products and services sold	$	12,337	$	9,792	$	9,350
Research and development		81		86		81
Selling and marketing		234		207		172
General and administrative		1,430		1,656		542
Interest expense		1,402		1,489		1,100

Total depreciation and amortization	$	15,484	$	13,230	$	11,245

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

+ References + Details

Inventories

12 Months Ended

Apr. 30, 2012

Inventories [Abstract]

Inventories

9. Inventories

The following table sets forth a summary of inventories, stated at lower of cost or market, as of April 30, 2012 and 2011 (dollars in thousands):


	April 30, 2012		April 30, 2011
Finished goods	$	14,017	$	15,409
Finished parts		28,936		18,845
Work in process		7,889		8,091
Raw material		4,454		9,375

Total inventories	$	55,296	$	51,720

Intangible Assets

12 Months Ended

Apr. 30, 2012

Intangible Assets [Abstract]

Intangible Assets

10. Intangible Assets

We record intangible assets at cost. Intangible assets consist of customer relationships, developed technology, order backlog, trademarks, tradenames, patents, and software. We amortize patents and developed technology using the straight-line method over their estimated useful lives ranging from eight to 20 years. We amortize customer relationships in pro-ration to the expected yearly revenue generated from the customer lists acquired, currently estimated at 20 years.

The following table presents a summary of intangible assets (dollars in thousands):


	April 30, 2012
				Transferred to
				Assets Held for
	Historical Value			Sale (Note 3)			Carrying Value			April 30, 2011
Developed technology	$	1,380		$	(1,380	)	$	—		$	3,120
Customer relationships		1,840			(100	)		1,740			100
Patents, trademarks, and tradenames		7,229			(2,007	)		5,222			7,036
Software		542			(542	)		—			542
Backlog		—			—			—			2,400

		10,991			(4,029	)		6,962			13,198
Less: Accumulated amortization		(3,216	)		786			(2,430	)		(4,506	)

Total intangible assets, net	$	7,775		$	(3,243	)	$	4,532		$	8,692

Amortization expense, excluding amortization of deferred financing costs, amounted to $656,000, $630,000, and $646,000 for the fiscal years ended April 30, 2012, 2011, and 2010, respectively. We expect amortization expense will be approximately $700,000 annually over each of the next five fiscal years.

Receivables from Insurance Carriers

12 Months Ended

Apr. 30, 2012

Receivables from Insurance Carriers [Abstract]

Receivables from Insurance Carriers

11. Receivables from Insurance Carriers

As discussed in Notes 15 and 19, we are party to lawsuits related to the use of our firearm products. We carry insurance that covers certain legal and defense costs related to these matters and record a receivable from insurance carriers when the collection of the insurance proceeds is probable.

There has been no activity in the receivable account since fiscal 2009. The outstanding balance as of April 30, 2012 and 2011 was $2.1 million ($25,000 in other current assets and $2.0 million in non-current assets). Our insurance carriers paid no defense costs in fiscal 2012 or 2011.

Accrued Expenses

12 Months Ended

Apr. 30, 2012

Accrued Expenses [Abstract]

Accrued Expenses

12. Accrued Expenses

The following table sets forth other accrued expenses as of April 30, 2012 and 2011 (dollars in thousands):


	April 30, 2012			April 30, 2011
Accrued distributor incentives	$	5,453		$	6,301
Accrued professional fees		3,682			4,585
Accrued rebates and promotions		2,862			1,731
Accrued employee benefits		1,902			2,690
Interest payable		1,783			1,575
Accrued commissions		1,235			1,383
Accrued workers’ compensation		766			593
Accrued utilities		436			579
Current portion of capital lease obligation		418			—
Accrued severance/restructuring costs (Note 13)		345			1,252
Pension liability		117			111
Deferred revenue		80	(a)		1,855
Accrued other		1,606			2,701

Total accrued expenses	$	20,685		$	25,356

(a)

Deferred revenue of $1.7 million relating to the divestiture of our security solutions business has been reclassified to liabilities held for sale, which is not included in the above table.

Plant Consolidation

12 Months Ended

Apr. 30, 2012

Plant Consolidation [Abstract]

Plant Consolidation

13. Plant Consolidation

On December 8, 2010, we implemented a restructuring plan to move the production of our hunting products to our Springfield, Massachusetts facility and to close our Rochester, New Hampshire facility. We completed this restructuring plan in November 2011. We have incurred major capital expenditures relating to moving equipment and processes from Rochester, New Hampshire to Springfield, Massachusetts, improving production efficiencies, purchasing tooling for new product offerings, and various projects designed to increase capacity and upgrade manufacturing technology.

In connection with the plant consolidation, in January 2012, we completed the sale of K.W. Thompson, a company that included our foundry operations and which was a subsidiary of Thompson/Center Arms, for a purchase price of $900,000. Upon closing of the sale agreement, we issued a $400,000 note receivable that bears interest at 4% and matures in January 2017. We have recorded $75,000 of the note receivable included in other current assets and $301,000 included in other assets on our consolidated balance sheets. We also recorded a loss on sale of business, which was calculated as the net assets sold in excess of the purchase price, $241,000 of which is included in general and administrative expenses on our consolidated statements of operations and comprehensive income/(loss). The business sold was not included in discontinued operations because the operations were not material to our overall consolidated financial statements.

The land and building located in Rochester, New Hampshire have been classified as assets held for sale on our consolidated balance sheets in accordance with ASC 360-10-45, Impairment or Disposal of Long Lived Assets. The net book values of our assets held for sale totaled $2.5 million and is stated at the lower of the carrying value or fair value. On March 30, 2012, we entered into a purchase and sale agreement for the land and building located in Rochester, New Hampshire. The purchase and sale agreement is subject to customary closing conditions and environmental regulatory clearances and is scheduled to close in the third quarter of fiscal 2013. The purchase and sale agreement provides that we will indemnify the buyer from losses arising from, among other things, environmental conditions related to Thompson/Center Arms’ manufacturing activities. We have estimated the total site remediation costs at $1.5 million and have established an accrual equal to that amount offsetting assets held for sale on our consolidated balance sheets.

For the fiscal year ended April 30, 2012, we recorded $3.0 million in expenses related to facilities and employee severance, including $2.5 million of restructuring expenses in costs of goods sold, excluding the impact of reduced productivity and efficiencies in our Rochester, New Hampshire facility, and $493,000 in operating expenses. We do not anticipate any additional expenses relating to the plant consolidation during fiscal 2013 that would materially impact our financial results. The total amount incurred in connection with our restructuring plan was $5.6 million, with $2.5 million for employee severance and relocation expenses and $3.1 million for facilities-related expenses.

The following table summarizes the restructuring liabilities accrued for and changes in those amounts during the year ended April 30, 2012 for the plan discussed above (dollars in thousands):


	Employee Severance and Termination Benefits			Facilities-Related Costs
Balance at April 30, 2010	$	—		$	—
Costs incurred during the period		1,383			1,279
Costs paid or settled during the period		(131	)		(870	)

Balance at April 30, 2011	$	1,252		$	409
Costs incurred during the period		1,146			1,832
Costs paid or settled during the period		(2,053	)		(2,241	)

Balance at April 30, 2012	$	345		$	—

On December 21, 2010, under the Economic Development Incentive Program (“EDIP”) of the Commonwealth of Massachusetts, we were awarded a refundable economic incentive tax credit (“ITC”) by the Economic Assistance Coordinating Council in conjunction with our plan discussed above. The ITC is calculated as 40% of qualified capital expenditures placed in service and allows for a refundable tax credit from the Commonwealth of Massachusetts of up to $4.4 million during the fiscal year ended April 30, 2012. As of April 30, 2011, we had recorded the $4.4 million of the amount received for the ITC as a contra asset account, which is included in Property, Plant, and Equipment. During fiscal 2012, we received $4.4 million of the tax credit because of our compliance with the written EDIP Investment Analysis Plan.

Fair Value Measurement

12 Months Ended

Apr. 30, 2012

Fair Value Measurement [Abstract]

Fair Value Measurement

14. Fair Value Measurement

We follow the provisions of ASC 820-10, Fair Value Measurements and Disclosures Topic, for our financial assets and liabilities. ASC 820-10 provides a framework for measuring fair value under GAAP and requires expanded disclosures regarding fair value measurements. ASC 820-10 defines fair value 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. ASC 820-10 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs, where available, and minimize the use of unobservable inputs when measuring fair value.

Financial assets and liabilities recorded on the accompanying consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows:

Level 1 — Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we have the ability to access at the measurement date (examples include active exchange-traded equity securities, listed derivatives, and most U.S. Government and agency securities).

Level 2 — Financial assets and liabilities whose values are based on quoted prices in markets in which trading occurs infrequently or whose values are based on quoted prices of instruments with similar attributes in active markets. Level 2 inputs include the following:

•

quoted prices for identical or similar assets or liabilities in non-active markets (such as corporate and municipal bonds which trade infrequently);

•

inputs other than quoted prices that are observable for substantially the full term of the asset or liability (examples include interest rate and currency swaps); and

•

inputs that are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability (such as certain securities and derivatives).

We currently do not have any Level 2 financial assets or liabilities.

Level 3 — Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect our assumptions about the assumptions a market participant would use in pricing the asset or liability. We currently do not have any Level 3 financial assets or liabilities.

The following table presents information about our assets and liabilities that are measured at fair value on a recurring basis as of April 30, 2012 and indicates the fair value hierarchy of the valuation techniques we utilized to determine such fair value (dollars in thousands):


	April 30,				April 30,
Description	2012		(Level 1)		2011		(Level 1)
Assets:
Cash equivalents	$	56,698	$	56,698	$	58,283	$	58,283

Total assets	$	56,698	$	56,698	$	58,283	$	58,283

- Definition

Tabular disclosure of the fair value measurement of assets and liabilities which includes [financial] instruments measured at fair value that are classified in stockholders' equity. Such assets and liabilities may be measured on a recurring or nonrecurring basis. The disclosures which may be required or desired include: (1) for assets and liabilities measured on a recurring basis, disclosure may include: (a) the fair value measurements at the reporting date; (b) the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets or liabilities (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3); (c) for fair value measurements using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (ii) purchases, sales, issuances, and settlements (net); (iii) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs); (d) the amount of the total gains or losses for the period in subparagraph (c) (i) above included in earnings (or changes in net assets) that are attributable to the change in unrealized gains or losses relating to those assets and liabilities still held at the reporting date and a description of where those unrealized gains or losses are reported in the statement of income (or activities); (e) the valuation technique(s) used to measure fair value and a discussion of changes in valuation techniques, if any, during the period and (2) for assets and liabilities that are measured at fair value on a nonrecurring basis (for example, impaired assets) disclosure may include, in addition to (a) above: (a) the reasons for the fair value measurements recorded; (b) the same as (b) above; (c) for fair value measurements using significant unobservable inputs (Level 3), a description of the inputs and the information used to develop the inputs; and (d) the valuation technique(s) used to measure fair value and a discussion of changes, if any, in the valuation technique(s) used to measure similar assets and/or liabilities in prior periods. Where the quoted price in an active market for the identical liability is not available, the Level 1 input is the quoted price of an identical liability when traded as an asset.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 107
-Paragraph 10
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 32
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 33
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 157
-Paragraph 6
-Footnote 4
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19207-110258

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19190-110258

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19279-110258

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6925170&loc=d3e19296-110258

+ Details

Self-Insurance Reserves

12 Months Ended

Apr. 30, 2012

Self-Insurance Reserves [Abstract]

Self-Insurance Reserves

15. Self-Insurance Reserves

As of April 30, 2012 and 2011, we had reserves for workers’ compensation, product liability, municipal liability, and medical/dental costs totaling $9.0 million and $9.5 million, respectively, of which $5.4 million and $4.6 million, respectively, have been classified as non-current and are included in other non-current liabilities and $2.2 million and $2.3 million, respectively, have been included in accrued expenses, and $1.4 million and $2.6 million, respectively, have been included in accrued product/municipal liability on the accompanying consolidated balance sheets. In addition, as of April 30, 2012 and 2011, $332,000 and $221,000, respectively, of excess workers’ compensation receivable had been classified as an other asset. While we believe these reserves to be adequate, it is possible that the ultimate liabilities will exceed such estimates. Amounts charged to expense were $11.4 million, $11.5 million, and $10.3 million for the fiscal years ended April 30, 2012, 2011, and 2010, respectively.

The following table is a summary of the activity in the workers’ compensation, product liability, municipal liability, and medical/dental reserves in the fiscal years ended April 30, 2012, 2011, and 2010 (dollars in thousands):


	For the Year Ended April 30,
	2012			2011			2010
Beginning balance	$	9,456		$	9,694		$	10,985
Additional provision charged to expense		11,400			11,461			10,250
Payments		(11,876	)		(11,699	)		(11,541	)

Ending balance	$	8,980		$	9,456		$	9,694

It is our policy to provide an estimate for loss as a result of expected adverse findings or legal settlements on product liability, municipal liability, and workers’ compensation when such losses are probable and are reasonably estimable. It is also our policy to accrue for reasonable estimable legal costs associated with defending such litigation. While such estimates involve a range of possible costs, we determine, in consultation with litigation counsel, the most likely cost within such range on a case-by-case basis. We also record receivables from insurance carriers relating to these matters when their collection is probable. As of April 30, 2012 and 2011, we had accrued reserves for product and municipal litigation liabilities of $4.5 million and $5.5 million, respectively (of which $3.1 million and $2.9 million, respectively, were non-current), consisting entirely of expected legal defense costs. In addition, as of April 30, 2012 and 2011, we had recorded receivables from insurance carriers related to these liabilities of $2.0 million in each year, of which $2.0 million in each year has been classified as other assets and the remaining amount of $25,000 has been classified as other current assets.

Stock Option and Employee Stock Purchase Plans

12 Months Ended

Apr. 30, 2012

Stock Option and Employee Stock Purchase Plans [Abstract]

Stock Option and Employee Stock Purchase Plans

16. Stock Option and Employee Stock Purchase Plans

We have two stock option plans (the “SOPs”): the 2001 Stock Option Plan and the 2004 Incentive Stock Plan. New grants under the 2001 Stock Option Plan have not been made since the approval of the 2004 Incentive Stock Plan at our September 13, 2004 annual meeting of stockholders. All new grants covering all participants are issued under the 2004 Incentive Stock Plan.

The 2004 Incentive Stock Plan authorizes the issuance of the lesser of (1) 15% of the shares of our common stock outstanding from time to time, or (2) 10,000,000 shares of our common stock. The plan permits the grant of options to acquire common stock, restricted common stock and deferred stock, RSUs, stock appreciation rights, and dividend equivalents. Our board of directors, or a committee established by our board, administers the SOPs, selects recipients to whom awards are granted, and determines the grants to be awarded. Options granted under the SOPs are exercisable at a price determined by our board or committee at the time of grant, but in no event less than fair market value of our common stock on the date granted. Grants of options may be made to employees and directors without regard to any performance measures. All options issued pursuant to the SOPs are nontransferable and subject to forfeiture.

Unless terminated earlier by our board of directors, the 2004 Incentive Stock Plan will terminate on the earlier of (1) ten years from the date of the later to occur of (i) the original date the plan was approved by our board of directors or our stockholders, whichever is earlier, or (ii) the date an increase in the number of shares reserved for issuance under the plan is approved by our board of directors (so long as such increase is also approved by our stockholders), and (2) at such time as no shares of common stock remain available for issuance under the plan and our company has no further rights or obligations with respect to outstanding awards under the plan. The date of grant of an award is deemed to be the date upon which our board of directors or board committee authorizes the granting of such award. Generally, awards vest over a period of three years and are exercisable for a period of ten years. The plan also permits the grant of awards to non-employees, which the board has granted in the past. A separate option grant, outside of the 2004 Incentive Stock Plan, for 500,000 shares was made, at an exercise price of $1.47 per share, in connection with the hiring of our former President and Chief Executive Officer during the fiscal year ended April 30, 2005. Our former President and Chief Executive Officer resigned on September 26, 2012 and continues his service as a member of our board of directors and was appointed co-vice chairman of the Board. As of April 30, 2012, there were 350,000 options outstanding relating to this grant, which expire on December 6, 2014.

The number of shares and weighted average exercise prices of (i) options granted under the SOPs and (ii) the separate option grant to our former President and Chief Executive Officer outside of the SOPs for the fiscal years ended April 30, 2012, 2011, and 2010 are as follows:


	For the Year Ended April 30,
	2012					2011					2010
				Weighted-					Weighted-					Weighted-
				Average					Average					Average
	Shares			Exercise Price		Shares			Exercise Price		Shares			Exercise Price
Options outstanding, beginning of year		3,137,565		$	4.73		3,207,264		$	4.93		2,428,263		$	4.76
Granted during year		1,405,600			4.08		755,600			3.85		950,500			5.12
Exercised during year		(290,168	)		2.17		(90,334	)		1.60		(126,499	)		1.51
Canceled/forfeited during year		(264,833	)		5.03		(734,965	)		5.06		(45,000	)		9.43

Options outstanding, end of year		3,988,164		$	4.67		3,137,565		$	4.73		3,207,264		$	4.93

Weighted average remaining contractual life		6.98 years					5.95 years					6.99 years

Options exercisable, end of year		2,080,692		$	5.14		2,101,705		$	4.91		1,866,101		$	4.35

Weighted average remaining contractual life		5.09 years					4.47 years					5.55 years

As of April 30, 2012, there were 4,602,033 shares available for grant under the 2004 Incentive Stock Plan. We use our unissued share pool for all shares issued for options, restricted share awards, and ESPP issuances.

The aggregate intrinsic value of outstanding options as of April 30, 2012, 2011, and 2010 was $16.0 million, $1.6 million, and $2.7 million, respectively. The aggregate intrinsic value of outstanding options that were exercisable as of April 30, 2012, 2011, and 2010 was $8.2 million, $1.6 million, and $2.6 million, respectively. The aggregate intrinsic value of the options exercised for the years ended April 30, 2012, 2011, and 2010 was $982,000, $186,000, and $543,000, respectively. At April 30, 2012, the total unamortized fair value of options was $2.7 million, which will be recognized over the remaining vesting period of 3.0 years.

We had an ESPP that commenced on June 24, 2002 (the “2001 ESPP”), which authorized the sale of up to 10,000,000 shares of our common stock to employees. The 2001 ESPP continued in effect for a term of 10 years and expired with the offering period that ended March 31, 2012. All options and rights to participate in the 2001 ESPP are nontransferable and subject to forfeiture in accordance with the 2001 ESPP guidelines. As of April 30, 2012, we had issued 2,398,630 shares of common stock under the 2001 ESPP. During fiscal 2012, 2011, and 2010, 502,898, 350,971, and 280,438, shares were purchased under the 2001 ESPP, respectively.

On September 26, 2011, our stockholders approved the 2011 ESPP to replace our expiring 2001 ESPP. Initially, there was a total of 6,000,000 shares of our common stock reserved under the 2011 ESPP, which includes any shares available for issuance under the 2001 ESPP on the first offering date under the 2011 ESPP, but not to exceed 6,000,000 shares. The shares included in the 2011 ESPP are no longer be available for issuance under the 2001 ESPP. The 2011 ESPP will be implemented in a series of successive offering periods, each with a maximum duration of 12 months. If the fair market value (“FMV”) per share of our common stock on any purchase date is less than the FMV per share on the start date of a 12-month offering period, then that offering period will automatically terminate, and a new 12-month offering period will begin on the next business day. Each offering period will begin on April 1 or October 1, as applicable, immediately following the end of the previous offering period. Payroll deductions will be on an after-tax basis, in an amount of not less than 1% and not more than 20% (or such greater percentage as the committee appointed to administer the 2011 ESPP may establish from time to time before the first day of an offering period) of a participant’s compensation on each payroll date. The option exercise price per share will equal 85% of the lower of the FMV on the first day of the offering period or the FMV on the exercise date. The maximum number of shares that a participant may purchase during any purchase period is 12,500 shares, or a total of $25,000 in shares, based on the FMV on the first day of the offering period. The 2011 ESPP’s effective date is April 1, 2012, and the 2011 ESPP will remain in effect until the earliest of (a) the exercise date that participants become entitled to purchase a number of shares greater than the number of reserved shares available for purchase under the 2011 ESPP, (b) such date as is determined by our Board of Directors in its discretion, or (c) March 31, 2022. As of April 30, 2012, no shares of common stock were issued under the 2011 ESPP.

We measure the cost of employee services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. We calculate the fair value of our stock options and warrants issued to employees using the Black-Scholes model at the time the options and warrants were granted. That amount is then amortized over the vesting period of the option or warrant. With our 2011 ESPP, fair value is determined at the beginning of the purchase period and amortized over the term of the offering period.

The following assumptions were used in valuing our options and 2001 ESPP purchases during the 12-month periods ended April 30, 2012, 2011, and 2010:


	For the Year Ended April 30,
	2012			2011			2010
Stock option grants:
Risk-free interest rate		0.85 -2.20	%		1.31 -2.47	%		3.42 -3.80	%
Expected term		5.30 -8.18 years			5.36 -9.0 years			7.08 -10.0 years
Expected volatility		66.9 - 74.6	%		69.5 - 76.4	%		76.0 - 76.9	%
Dividend yield		0	%		0	%		0	%
Employee Stock Purchase Plan:
Risk-free interest rate		0.08	%		0.18	%		0.21	%
Expected term		6 months			6 months			6 months
Expected volatility		51.3	%		34.0	%		60.9	%
Dividend yield		0	%		0	%		0	%

We estimate expected volatility using historical volatility for the expected term. The fair value of each stock option or 2011 ESPP purchase was estimated on the date of the grant using the Black-Scholes option pricing model (using the risk-free interest rate, expected term, expected volatility, and dividend yield variables, as noted in the above table). The weighted-average fair value of stock options granted during fiscal 2012, 2011, and 2010 was $2.66, $2.63, and $4.00, respectively. During fiscal 2012, 2011, and 2010, we granted 1,405,600, 755,600, and 950,500 option shares, respectively. The total stock-based compensation expense, including stock options, purchases under the 2001 ESPP, and RSU and PSU awards, was $2.5 million, $1.7 million, and $3.3 million, for fiscal years 2012, 2011, and 2010, respectively. Stock-based compensation expense is included in general and administrative expenses.

We grant service-based RSUs to employees and consultants. The grants are made at no cost to the recipient. RSUs represent one share of our common stock and do not carry voting or dividend rights. RSU grants to employees generally vest over a period of three years with one-third of the units vesting on each anniversary date of the grant date. The aggregate fair value of our RSU grants is being amortized to compensation expense over the vesting period.

We grant PSUs with market conditions to our executive officers. At the time of grant, we calculate the fair value of our PSUs using Monte-Carlo simulation. We incorporate the following variables into the valuation model:


	For the Year Ended April 30,
	2012			2011
Grant date fair market value
Smith & Wesson Holding Corporation	$	3.57 - 7.98		$	3.69 - 3.92
NASDAQ Composite Index	$	—		$	2,295.36 - 2,369.77
Russell 2000 Index	$	798.05 - 2,781.91		$	—
Volatility (a)
Smith & Wesson Holding Corporation		51.43 - 67.67	%		83.96 - 84.65	%
NASDAQ Composite Index		—			31.45 - 31.48	%
Russell 2000 Index		27.64 - 29.97	%		—
Correlation coefficient (b)		0.46 - 0.49			0.39
Risk-free interest rate (c)		0.40 - 0.63	%		0.66 - 0.85	%
Dividend yield (d)		0	%		0	%

(a)

Volatility is calculated over the most recent period that represents the remaining term of the performance period as of the valuation date, or three years.

(b)

The correlation coefficient utilizes the same historical price data used to develop the volatility assumptions.

(c)

The risk-free interest rate is based on the yield of a zero-coupon U.S. Treasury bill, commensurate with the three year performance period.

(d)

We do not expect to pay a dividend.

The PSUs vest, and the fair value of the PSUs will be recognized, over the corresponding three-year performance period. Our PSUs have a maximum aggregate award equal to 200% of the target amount granted. The number of PSUs that may be earned depends upon the total stockholder return (“TSR”) of our common stock compared to the TSR of the Russell 2000 Index (the “RUT”) or NASDAQ Composite Index (the “IXIC”), as applicable, over the three-year performance period. Our stock must outperform the RUT or the IXIC, as appropriate, by 10% in order for the target award to be earned.

During the fiscal year ended April 30, 2012, we granted 149,873 service-based RSUs to employees and consultants. On April 24, 2012, we granted 114,000 PSUs to certain of our executive officers. On July 12, 2011, we granted 95,200 PSUs to certain of our executive officers.

During the fiscal year ended April 30, 2012, we cancelled 88,700 PSUs previously granted to our former President and Chief Executive Officer due to the service period condition not being met. Compensation expense recognized related to grants of RSUs and PSUs, excluding the $180,000 impact of the 88,700 cancelled PSUs, was $350,000 for the 12 months ended April 30, 2012. During the 12 months ended April 30, 2012, we delivered 9,500 shares of common stock to employees and consultants under vested RSUs with a total market value of $43,000.

During the fiscal year ended April 30, 2011, we granted 7,500 service-based RSUs to consultants and 120,200 PSUs to certain of our executive officers. We delivered 67,195 shares of common stock with a total market value of $271,000, under RSUs that vested during such period.

During the fiscal year ended April 30, 2011, we cancelled an aggregate of 134,999 PSUs, consisting of (i) 53,333 PSUs previously granted to our former President and Chief Executive Officer, as financial targets associated with these PSUs were not met for the fiscal year ended April 30, 2011, (ii) 40,000 PSUs previously granted to our former Executive Vice President and Chief Financial Officer due to the service period condition not being met, (iii) 15,000 PSUs previously granted to our former President of SWSS due to the service period condition not being met, and (iv) 26,666 PSUs previously granted to our former President and Chief Executive Officer, as financial targets associated with these PSUs were not met for the fiscal year ended April 30, 2010. Compensation expense recognized related to grants of RSUs and PSUs, excluding the $905,000 impact of the 134,999 cancelled PSUs previously granted to the former employees named above, was $281,000 for the fiscal year ended April 30, 2011.

During the fiscal year ended April 30, 2010, we granted 7,500 RSUs to consultants. We granted 39,900 PSUs to our former President and Chief Executive Officer and our former Executive Vice President and Chief Financial Officer. All of the PSUs granted in fiscal year 2010 have been forfeited due to the service period condition not being met.

During the fiscal year ended April 30, 2010, 53,333 PSUs previously awarded to our former President and Chief Executive Officer vested and were delivered in fiscal 2011. Share-based compensation expense recognized related to RSU and PSU grants to certain employees and non-employees was approximately $423,000 for the fiscal year ended April 30, 2010.

The grant date fair value of RSUs and PSUs that vested in fiscal 2012, 2011, and 2010 was $43,000, $321,000, and $1.4 million, respectively. As of April 30, 2012, there was $1.9 million of unrecognized compensation cost related to unvested RSUs and PSUs. This cost is expected to be recognized over a weighted average remaining contractual term of 2.3 years.

A summary of activity in unvested RSUs and PSUs for fiscal years 2012, 2011, and 2010, is as follows:


	For the Year Ended April 30,
	2012					2011					2010
	Total # of Restricted Stock Units			Weighted Average Grant Date Fair Value		Total # of Restricted Stock Units			Weighted Average Grant Date Fair Value		Total # of Restricted Stock Units			Weighted Average Grant Date Fair Value
RSUs and PSUs outstanding, beginning of year		123,600		$	5.27		210,727		$	10.32		346,944		$	9.89
Awarded		359,073			7.66		127,700			3.87		47,400			5.31
Vested		(9,500	)		4.18		(79,828	)		11.36		(171,284	)		8.16
Forfeited		(89,033	)		5.31		(134,999	)		8.22		(12,333	)		9.12

RSUs and PSUs outstanding, end of year		384,140		$	7.91		123,600		$	5.27		210,727		$	10.32

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 123R
-Paragraph 64, 65, A240
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Statement of Position (SOP)
-Number 93-6
-Paragraph 53
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 14

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 50
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 40
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929

+ Details

Employer Sponsored Benefit Plans

12 Months Ended

Apr. 30, 2012

Employer Sponsored Benefit Plans [Abstract]

Employer Sponsored Benefit Plans

17. Employer Sponsored Benefit Plans

Contributory Defined Investment Plan — We offer a contributory defined investment plan covering substantially all employees who have completed at least six months of service, as defined. Employees may contribute from 1% to 30% of their annual pay, with us matching 50% of the first 6% of combined pre- and post-tax compensation. We contributed $1.5 million, $991,000, and $1.6 million for the fiscal years ended April 30, 2012, 2011, and 2010, respectively.

Non-Contributory Profit Sharing Plan — We have a non-contributory profit sharing plan covering substantially all of our Springfield, Massachusetts and Houlton, Maine employees. Employees become eligible on May 1 following the completion of a full fiscal year of continuous service. We contribute 15% of our net operating profit before interest and taxes up to 15% of qualifying payroll, as defined, to the plan each year. For fiscal 2012, we plan to contribute approximately $8.0 million. We contributed $4.1 million and $7.2 million for the fiscal years ended April 30, 2011 and 2010, respectively. Contributions are funded after the fiscal year-end.

- Definition

The entire disclosure for pension and other postretirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5
-Subparagraph a
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5
-Subparagraph b
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5
-Subparagraph h
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5
-Subparagraph q
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 8
-Subparagraph m
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 106
-Paragraph 518
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 87
-Paragraph 264
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Emerging Issues Task Force (EITF)
-Number 03-2
-Paragraph 8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Principles Board Opinion (APB)
-Number 30
-Paragraph 26
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Staff Position (FSP)
-Number FAS106-2
-Paragraph 20, 21, 22
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 158
-Paragraph 7, 21, 22
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 132R
-Paragraph 5, 6, 7, 8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Implementation Guide (Q and A)
-Number FAS88
-Paragraph 63
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-URI http://asc.fasb.org/topic&trid=2235017

+ Details

Income Taxes

12 Months Ended

Apr. 30, 2012

Income Taxes [Abstract]

Income Taxes

18. Income Taxes

We use an asset and liability approach for financial accounting and reporting of income taxes. Deferred tax assets and liabilities are determined based on temporary differences between financial reporting and tax bases of assets and liabilities and are measured by applying enacted tax rates and laws to the taxable years in which differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

Income tax expense from continuing operations consists of the following (dollars in thousands):


	For the Year Ended April 30,
	2012			2011			2010
Current:
Federal	$	9,816		$	1,701		$	8,718
State		2,050			1,931			2,348

Total current		11,866			3,632			11,066
Deferred:
Deferred federal		778			2,223			2,920
Deferred state		(62	)		(401	)		102

Total deferred		716			1,822			3,022

Total income tax expense	$	12,582		$	5,454		$	14,088

The following table presents a reconciliation of the provision for income taxes from continuing operations at statutory rates to the provision in the consolidated financial statements (dollars in thousands):


	For the Year Ended April 30,
	2012			2011			2010
Federal income taxes expected at 35% statutory rate	$	13,655		$	4,737		$	12,625
State income taxes, less federal income tax benefit		1,328			452			1,439
Employee Stock Purchase Plan		83			96			154
Other		60			238			712
Business meals and entertainment		98			100			121
Worthless stock deduction		(1,845	)		—			—
Depreciation-permanent		—			(22	)		(2	)
Domestic production activity deduction		(676	)		—			(445	)
Research and development tax credit		(100	)		(242	)		(53	)
Change in uncertain tax positions		(21	)		95			(463	)

Total income tax expense	$	12,582		$	5,454		$	14,088

Future tax benefits (deferred tax liabilities) related to temporary differences are the following (dollars in thousands):


	April 30,
	2012			2011 (Adjusted)^(a)
Current tax assets (liabilities):
Environmental reserves	$	108		$	118
Inventory reserves		5,020			5,040
Product liability		532			833
Accrued expenses, including compensation		4,542			5,492
Warranty reserve		2,206			1,306
Other		105			1,025	(a)
Property taxes		(51	)		(51	)
Promotions		756			616
Less valuation allowance		(459	)		(258	)

Net deferred tax asset — current	$	12,759		$	14,121

Non-current tax assets (liabilities):
Net operating loss carryforwards and tax credits	$	2,370		$	2,253
Environmental reserves		224			222
Product liability		419			464
Workers’ compensation		725			542
Warranty reserve		412			303
Stock-based compensation		3,495			3,163	(a)
State bonus depreciation		583			404
Property, plant, and equipment		(11,600	)		(11,584	)
Intangible assets		452			(2,528	)
Transaction costs		(91	)		(189	)
Pension		142			136
Other		—			24
Less valuation allowance		(1,668	)		(918	)

Net deferred tax liability — non-current	$	(4,537	)	$	(7,708	)

Net deferred tax asset — total	$	8,222		$	6,413

(a)	Deferred taxes related to stock compensation have been adjusted from amounts reported in the prior year as noted below.

As required by ASC 740-10, Accounting for Income Taxes, we record tax assets or liabilities for the temporary differences between the book value and tax bases in assets and liabilities. In assessing the realization of our deferred income tax assets, we consider whether it is more likely than not that the deferred income tax assets will be realized. The ultimate realization of our deferred income tax assets depends upon generating future taxable income during the periods in which our temporary differences become deductible and before our net operating loss carryforwards expire. We evaluate the recoverability of our deferred income tax assets by assessing the need for a valuation allowance on a quarterly basis. If we determine that it is more likely than not that our deferred income tax assets will not be recovered, we establish a valuation allowance against some or all of our deferred income tax assets. Recording a valuation allowance or reversing a valuation allowance could have a significant effect on our future results of operations and financial position. Management is unaware of any recent or expected future changes in tax laws that would have a material impact on our financial statements.

During fiscal 2012, we noted an amount recorded in deferred taxes related to warrants that we had repurchased during fiscal 2006. The inclusion of a deferred tax asset related to these warrants was no longer required and should have been released during fiscal 2006. In order to reverse the liability and to properly reflect the deferred tax accounts from fiscal 2006 through fiscal 2011, we recorded an adjustment to the April 30, 2009 balances as follows: increasing long term deferred tax liabilities by $2.4 million, increasing current deferred tax assets by $48,000, decreasing additional paid-in capital by $430,000, and increasing accumulated deficit by $1.9 million. The effect of these adjustments is immaterial to prior years.

We had federal net operating loss carryforwards amounting to $865,000 as of April 30, 2012, which expire in fiscal 2020. We obtained $8.2 million in additional loss carryforwards through our acquisition of SWSS on July 20, 2009, the majority of which was utilized in fiscal 2010. Utilization of the remaining losses is limited by Section 382 of the Internal Revenue Code to $403,000 in fiscal 2012 and $108,000 for each taxable year thereafter. It is possible that future substantial changes in our ownership could occur that could result in additional ownership changes pursuant to Section 382 of the Internal Revenue Code. If such an ownership change were to occur, there could be an annual limitation on the remaining tax loss carryforward.

There were $19.4 million and $10.9 million in state net operating loss carryforwards as of April 30, 2012 and 2011, respectively. The state net operating loss carryforwards will expire between April 30, 2015 and April 30, 2032. There were $1.9 million and $1.7 million of state tax credit carryforwards as of April 30, 2012 and 2011, respectively. The state tax credit carryforwards will expire between April 30, 2014 and April 30, 2025 or have no expiration date.

As of April 30, 2012, valuation allowances of $827,000 and $1.1 million were provided on our deferred tax assets for state net operating loss carryforward, and state tax credits, respectively, that we do not anticipate using prior to their expiration and $239,000 for other state deferred tax assets for which we anticipate we will realize no benefit. As of April 30, 2011, valuation allowances of $26,000, $445,000, and $705,000 were provided on our deferred tax assets for a federal capital loss carryforward, state net operating loss carryforwards, and state tax credits, respectively. The increase in the valuation allowance on our deferred tax assets for state net operating losses and credits and other state deferred tax assets related mainly to our operations in Tennessee. No other valuation allowance was provided on our deferred federal income tax assets as of April 30, 2012 or 2011, as we believe that it is more likely than not that all such assets will be realized.

At April 30, 2012 and 2011, we had gross tax-effected unrecognized tax benefits of $1.2 million and $1.1 million, respectively, of which the entire amounts, if recognized, would favorably impact the effective tax rate. Included in the unrecognized tax benefits at April 30, 2012 and 2011, we have $260,000 and $178,000, respectively, of accrued interest and penalties related to uncertain tax positions, which have been recorded in other current and non-current liabilities.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (dollars in thousands):


	April 30,
	2012			2011
Beginning balance	$	1,123		$	1,923
Gross increases/(decreases)—tax positions in prior year		(5	)		112
Gross decreases—current period tax positions		—			(871	)
Settlements		(9	)		(119	)
Interest, penalties, and impact of state deductions on federal taxes		85			78
Lapse of statute of limitations		(44	)		—

Ending balance	$	1,150		$	1,123

Approximately $386,000 of our unrecognized tax benefits has been classified as current income tax liabilities because a payment of cash is anticipated within one year of the balance sheet date or the statute is expected to expire. In fiscal 2013, we expect to incur additional taxes, interest and penalties on uncertain tax positions. The remainder has been classified as non-current because a payment of cash is not anticipated within one year. We do not expect this change to be material. Interest and penalties related to income tax liabilities are included in income tax expense.

With limited exception, we are subject to U.S. federal, state, and local, or non-U.S. income tax audits by tax authorities for fiscal years subsequent to April 30, 2008.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 08
-Paragraph h
-Article 4

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 136, 172
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 109
-Paragraph 43, 44, 45, 46, 47, 48, 49
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32718-109319

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32639-109319

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(h))
-URI http://asc.fasb.org/extlink&oid=6881521&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32537-109319

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6907707&loc=d3e32559-109319

+ Details

Commitments and Contingencies

12 Months Ended

Apr. 30, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

19. Commitments and Contingencies

Litigation

On January 19, 2010, the DOJ unsealed indictments of 22 individuals from the law enforcement and military equipment industries, one of whom was our former Vice President-Sales, International & U.S. Law Enforcement. We were not charged in the indictment. We also were served with a Grand Jury subpoena for the production of documents. We have always taken, and continue to take seriously, our obligation as an industry leader to foster a responsible and ethical culture, which includes adherence to laws and industry regulations in the United States and abroad. Although we are cooperating fully with the DOJ in this matter and have undertaken a comprehensive review of company policies and procedures, the DOJ may determine that we have violated FCPA laws. On February 21, 2012, the DOJ filed a motion to dismiss with prejudice the indictments of the remaining defendants who are pending trial, including our former Vice President-Sales, International & U.S. Law Enforcement. On February 24, 2012, the district court granted the motion to dismiss. We cannot predict, however, when the investigation will be completed or its outcome. There could be additional indictments of our company, our officers, or our employees. If the DOJ determines that we violated FCPA laws, we may face sanctions, including significant civil and criminal penalties. In addition, we could be prevented from bidding on domestic military and government contracts and could risk debarment by the U.S. Department of State. We also face increased legal expenses and could see an increase in the cost of doing international business. We could also see private civil litigation arising as a result of the outcome of the investigation. In addition, responding to the investigation may divert the time and attention of our management from normal business operations. Regardless of the outcome of the investigation, the publicity surrounding the investigation and the potential risks associated with the investigation could negatively impact the perception of our company by investors, customers, and others.

In fiscal 2011, we received a subpoena from the staff of the SEC giving notice that the SEC is conducting a non-public, fact-finding inquiry to determine whether there have been any violations of the federal securities laws. It appears this civil inquiry was triggered in part by the DOJ investigation into potential FCPA violations. Although we are cooperating fully with the SEC in this matter, the SEC may determine that we have violated federal securities laws. We cannot predict when this inquiry will be completed or its outcome. If the SEC determines that we have violated federal securities laws, we may face injunctive relief, disgorgement of ill-gotten gains, and sanctions, including fines and penalties, or may be forced to take corrective actions that could increase our costs or otherwise adversely affect our business, results of operations, and liquidity. We also face increased legal expenses and could see an increase in the cost of doing business. We could also see private civil litigation arising as a result of the outcome of this inquiry. In addition, responding to the inquiry may divert the time and attention of our management from normal business operations. Regardless of the outcome of the inquiry, the publicity surrounding the inquiry and the potential risks associated with the inquiry could negatively impact the perception of our company by investors, customers, and others.

We are involved in two purported stockholder derivative lawsuits. These actions were brought by putative plaintiffs on behalf of our company against certain of our officers, directors, and employees. The lawsuits are based principally on a theory of breach of fiduciary duties. The putative plaintiffs seek unspecified damages on behalf of our company from the individual defendants, and recovery of their attorneys’ fees.

We are a defendant in approximately nine product liability cases and are aware of approximately 12 other product liability claims, primarily alleging defective product design, defective manufacturing or failure to provide adequate warnings. In addition, we are a co-defendant in a case brought by the city of Gary, Indiana against numerous firearm manufacturers, distributors, and dealers seeking to recover damages allegedly arising out of the misuse of firearms by third parties. We believe that the various allegations as described above are unfounded, and, in addition, that any accident and any results from them were due to negligence or misuse of the firearm by the claimant or a third party and that there should be no recovery against us.

In addition, we are involved in lawsuits, claims, investigations, and proceedings, including commercial, environmental, and employment matters, which arise in the ordinary course of business.

The relief sought in individual cases primarily includes compensatory and, sometimes, punitive damages. Certain of the cases and claims seek unspecified compensatory or punitive damages. In others, compensatory damages sought may range from less than $75,000 to in excess of $1.4 million. In our experience, initial demands do not generally bear a reasonable relationship to the facts and circumstances of a particular matter. We believe that our accruals for product liability cases and claims, as described below, are a reasonable quantitative measure of the cost to us of product liability cases and claims.

We are vigorously defending ourselves in the lawsuits to which we are subject. An unfavorable outcome or prolonged litigation could harm our business. Litigation of this nature also is expensive and time consuming, and diverts the time and attention of our management.

We monitor the status of known claims and the product liability accrual, which includes amounts for defense costs for asserted and unasserted claims. While it is difficult to forecast the outcome of these claims, we believe, after consultation with litigation counsel, that it is uncertain whether the outcome of these claims will have a material adverse effect on our financial position, results of operations, or cash flows. We believe that we have provided adequate reserves for defense costs. We do not anticipate material adverse judgments and intend to vigorously defend ourselves.

For the fiscal years ended April 30, 2012, 2011, and 2010, we paid $401,000, $1.3 million, and $1.0 million, respectively, in defense and administrative costs relative to product liability and municipal litigation. In addition, we spent an aggregate of $105,000, $70,000, and $1.1 million, respectively, in those fiscal years in settlement fees related to product liability cases.

We have recorded our liability for defense costs before consideration for reimbursement from insurance carriers. We have also recorded the amount due as reimbursement under existing policies from the insurance carriers as a receivable shown in other current assets and other assets.

In fiscal 2012, we recorded income of $560,000 to recognize changes in our product liability and municipal litigation liability. In fiscal 2011 and 2010, we recorded income and expense of $1.0 million and $74,000, respectively, to recognize changes in our product liability and municipal litigation liability.

At this time, an estimated range of reasonably possible additional losses relating to unfavorable outcomes cannot be made.

Environmental Remediation

We are subject to numerous federal, state, and local laws that regulate the discharge of materials into, or otherwise relate to the protection of, the environment. These laws have required, and are expected to continue to require, us to make significant expenditures of both a capital and expense nature. Several of the more significant federal laws applicable to our operations include the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), and the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act.

We have in place programs and personnel to monitor compliance with various federal, state, and local environmental regulations. In the normal course of our manufacturing operations, we are subject to governmental proceedings and orders pertaining to waste disposal, air emissions, and water discharges into the environment. We fund our environmental costs through cash flows from operations. We believe that we are in compliance with applicable environmental regulations in all material respects.

We are required to remediate hazardous waste at our facilities. Currently, we own designated sites in Springfield, Massachusetts and are subject to two release areas, which are the focus of remediation projects as part of the Massachusetts Contingency Plan (“MCP”). The MCP provides a structured environment for the voluntary remediation of regulated releases. We may be required to remove hazardous waste or remediate the alleged effects of hazardous substances on the environment associated with past disposal practices at sites not owned by us. We have received notice that we are a potentially responsible party from the Environmental Protection Agency and/or individual states under CERCLA or a state equivalent at one site.

Pursuant to the merger agreement related to our acquisition of Thompson/Center Arms, the former stockholders of Thompson Center Holding Corporation agreed to indemnify us for losses arising from, among other things, environmental conditions related to Thompson/Center Arms’ manufacturing activities. Of the purchase price, $8.0 million was placed in an escrow account, a portion of which was to be applied to environmental remediation at the manufacturing site in Rochester, New Hampshire. In November 2008, $2.5 million of the escrow account was released to the former stockholders of Thompson Center Holding Corporation. We and the former stockholders of Thompson Center Holding Corporation entered into a settlement agreement under which $1.2 million was released to us from the escrow account for remediation costs and the remainder was released to such former stockholders. On March 30, 2012, we entered into a purchase and sale agreement for the land and building located in Rochester, New Hampshire pursuant to which we agreed to indemnify the buyer for losses arising from, among other things, environmental conditions related to Thompson/Center Arms’ manufacturing activities. We have estimated the total site remediation costs at $1.5 million and have offset the costs against assets held for sale on our consolidated balance sheet. We believe the likelihood of environmental remediation costs exceeding the amount accrued to be remote.

As of April 30, 2012 and 2011, we had reserves of $2.1 million, including $1.5 million relating to the land and building located in Rochester, New Hampshire, for environmental matters that were reclassified to assets held for sale during fiscal 2012, for remediation of the sites referred to above and believe that the time frame for remediation is currently indeterminable. As of April 30, 2012 and 2011, we had recorded $577,000 and $2.0 million, respectively of the environmental reserve in non-current liabilities with the remaining balances recorded in accrued expenses. Based on the indeterminable time frame for remediation, the time frame for payment of such remediation is likewise currently indeterminable, thus making any net present value calculation impracticable. Our estimate of these costs is based upon currently enacted laws and regulations, currently available facts, experience in remediation efforts, existing technology, and the ability of other potentially responsible parties or contractually liable parties to pay the allocated portions of any environmental obligations.

When the available information is sufficient to estimate the amount of liability, that estimate has been used, when the information is only sufficient to establish a range of probable liability and no point within the range is more likely than any other, the lower end of the range has been used. We may not have insurance coverage for our environmental remediation costs. We have not recognized any gains from probable recoveries or other gain contingencies. The environmental reserve was calculated using undiscounted amounts based on independent environmental remediation reports obtained.

Based on information known to us, we do not expect current environmental regulations or environmental proceedings and claims to have a material adverse effect on our consolidated financial position, results of operations, or cash flows. However, it is not possible to predict with certainty the impact on us of future environmental compliance requirements or of the cost of resolution of future environmental proceedings and claims, in part because the scope of the remedies that may be required is not certain, liability under federal environmental laws is joint and several in nature, and environmental laws and regulations are subject to modification and changes in interpretation. There can be no assurance that additional or changing environmental regulation will not become more burdensome in the future and that any such development would not have a material adverse effect on our company.

Suppliers

The inability to obtain sufficient quantities of components, parts, raw materials, and other supplies from independent sources necessary for the production of our products could result in reduced or delayed sales or lost orders. Any delay in or loss of sales could adversely impact our operating results. Many of the components, parts, raw materials, and other supplies used in the production of our products are available only from a limited number of suppliers. In most cases, we do not have long-term supply contracts with these suppliers.

Contracts

Employment Agreements — We have employment, severance, and change of control agreements with certain officers and managers.

Other Agreements — We have distribution agreements with various third parties in the ordinary course of business.

Outstanding Letters of Credit/Restricted Cash — We had open letters of credit aggregating $1.2 million as of April 30, 2012. We had restricted cash totaling $3.3 million as of April 30, 2012 of which $2.5 million acts as a compensating balance against our line of credit dated December 7, 2010 and $812,000 is related to the environmental remediation required to be performed in accordance with our credit facility with TD Bank.

Rental Leases

We lease office space in Scottsdale, Arizona, under an operating lease which expires in January 2013; machinery and photocopiers at our Springfield and Houlton locations with various expiration dates; and vehicles for our national sales force.

As of April 30, 2012, the lease commitments were as follows (dollars in thousands):


For the Year Ended April 30,	Amount
2013	$	1,445
2014		1,028
2015		315
2016		31
2017		2

	$	2,821

Rent expense in the fiscal years ended April 30, 2012, 2011, and 2010 was $2.3 million, $2.1 million, and $1.5 million, respectively.

- Definition

The entire disclosure for commitments and contingencies.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Interpretation (FIN)
-Number 14
-Paragraph 3
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 5
-Paragraph 9, 10, 11, 12
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.25)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 450
-SubTopic 20
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6952336&loc=d3e14435-108349

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 460
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6398077&loc=d3e12565-110249

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 440
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6394976&loc=d3e25287-109308

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 20
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6449706&loc=d3e16207-108621

+ Details

Quarterly Financial Information (Unaudited)

12 Months Ended

Apr. 30, 2012

Quarterly Financial Information (Unaudited) [Abstract]

Quarterly Financial Information (Unaudited)

20. Quarterly Financial Information (Unaudited)

The following table summarizes quarterly financial results in fiscal 2012 and 2011. In our opinion, all adjustments necessary to present fairly the information for such quarters have been reflected (dollars in thousands, except per share data):


	For the Year Ended April 30, 2012
	First			Second			Third			Fourth			Full
	Quarter			Quarter			Quarter			Quarter			Year
Net sales	$	91,730		$	92,299		$	98,125		$	129,843		$	411,997

Gross profit		26,516			24,606			30,004			46,863			127,989
Income from continuing operations, net of tax		2,275			948			5,393			17,817			26,433
Loss from discontinued operations, net of tax		(1,485	)		(2,539	)		(955	)		(5,349	)(a)		(10,328	)

Net income/(loss)	$	790		$	(1,591	)	$	4,438		$	12,468		$	16,105
Per common share

Basic—continuing operations	$	0.04		$	0.01		$	0.08		$	0.27		$	0.41
Diluted—continuing operations	$	0.04		$	0.01		$	0.08		$	0.27		$	0.40
Basic—net income/(loss)	$	0.01		$	(0.02	)	$	0.07		$	0.19		$	0.25
Diluted—net income/(loss)	$	0.01		$	(0.02	)	$	0.07		$	0.19		$	0.25

Market price (low-high)	$	2.63-3.67		$	2.29-3.39		$	2.72-5.20		$	4.93-8.60		$	2.29-8.60


	For the Year Ended April 30, 2011
	First		Second			Third			Fourth			Full
	Quarter		Quarter			Quarter			Quarter			Year
Net sales	$	77,763	$	83,565		$	79,238		$	101,667		$	342,233

Gross profit		28,629		25,427			19,391			31,240			104,688

Income/(loss) from continuing operations, net of tax		3,830		2,572			(2,715	)		4,393			8,080

Income/(loss) from discontinued operations, net of tax		2,382		(39,857	)(a)		(50,121	)(a)		(3,253	)		(90,849	)

Net income/(loss)	$	6,212	$	(37,285	)	$	(52,836	)	$	1,140		$	(82,769	)
Per common share

Basic—continuing operations	$	0.06	$	0.04		$	(0.05	)	$	0.07		$	0.13

Diluted—continuing operations	$	0.06	$	0.04		$	(0.05	)	$	0.07		$	0.13
Basic—net income/(loss)	$	0.10	$	(0.62	)	$	(0.88	)	$	0.02		$	(1.37	)
Diluted—net income/(loss)	$	0.10	$	(0.58	)	$	(0.88	)	$	0.02		$	(1.30	)

Market price (low-high)	$	3.83-4.71	$	3.53-4.11		$	3.54-4.20		$	3.27-4.06		$	3.27-4.71

(a)

The loss recorded during the fourth quarter of fiscal 2012 related primarily to the anticipated loss on sale of our discontinued security solutions business. The loss recorded during the second and third quarters of fiscal 2011 related primarily to the impairment of goodwill and intangible assets. See Note 3 for further details.

- Definition

The entire disclosure for the quarterly financial data in the annual financial statements. The disclosure may include a tabular presentation of financial information for each fiscal quarter for the current and previous year, including revenues, gross profit, income or loss before extraordinary items and earnings per share data. It also includes an indication if the information in the note is unaudited, comments on the aggregate effect of year-end adjustments, and an explanation of matters or transactions that affect comparability or are pertinent to an understanding of the information furnished.

+ References + Details

Valuation and Qualifying Accounts

12 Months Ended

Apr. 30, 2012

Valuation and Qualifying Accounts [Abstract]

VALUATION AND QUALIFYING ACCOUNTS

SCHEDULE II

SMITH & WESSON HOLDING CORPORATION AND SUBSIDIARIES

VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended April 30, 2012, 2011, and 2010


			Additions
	Balance at May 1,		Charged to Costs and Expenses			Charged to Other Accounts			Deductions			Balance at April 30,
2012
Allowance for doubtful accounts	$	2,147	$	(439	)	$	—		$	(650	)	$	1,058
Inventory reserve		7,117		511			(206	)(4)		(457	)		6,965
Deferred tax valuation allowance		1,176		951			—			—			2,127
Warranty reserve		4,213		6,328			(256	)(4)		(3,873	)		6,412
Product and municipal liabilities		5,473		(560	)		—			(401	)		4,512
Workers compensation		2,282		1,890			—			(1,164	)		3,008
Environmental		2,077		—			(1,470	)(3)		(30	)		577

2011
Allowance for doubtful accounts	$	811	$	1,379		$	—		$	(43	)	$	2,147
Inventory reserve		7,152		607			—			(642	)		7,117
Deferred tax valuation allowance		676		500			—			—			1,176
Warranty reserve		4,588		3,534			—			(3,909	)		4,213
Product and municipal liabilities		5,760		1,009			—			(1,296	)		5,473
Workers compensation		2,321		734			—			(773	)		2,282
Environmental		657		288			1,182	(2)		(50	)		2,077

2010
Allowance for doubtful accounts	$	2,386	$	(278	)	$	271	(1)	$	(1,568	)	$	811
Inventory reserve		6,524		2,115			—			(1,487	)		7,152
Deferred tax valuation allowance		675		1			—			—			676
Warranty reserve		5,334		3,004			58	(1)		(3,808	)		4,588
Product and municipal liabilities		6,880		(74	)		—			(1,046	)		5,760
Workers compensation		2,523		240			—			(442	)		2,321
Environmental		754		—			—			(97	)		657

(1)	Increase in allowance for doubtful accounts and warranty reserve was a result of the acquisition of SWSS on July 20, 2009.

(2)	Increase in environmental reserve was as a result of settlement with the former owners of Thompson/Center Arms regarding the environmental escrow established at acquisition for the Rochester, New Hampshire facility.

(3)	Decrease in environmental reserve was the result of a reclassification of the reserve related to the Rochester, New Hampshire facility to assets held for sale.

(4)	Decrease in the inventory reserve and warranty reserves was the result of a reclassification of assets and liabilities held for sale that relate to the SWSS disposal group.