ATLANTA, Oct. 25,
2023 /PRNewswire/ -- Marine Products Corporation
(NYSE: MPX) announced its unaudited results for the quarter ended
September 30, 2023. Marine Products
is a leading manufacturer of fiberglass boats under the brand names
of Chaparral and Robalo. Chaparral's sterndrive models include SSi
Sportboats and SSX Luxury Sportboats, along with the SURF Series.
Chaparral's outboard offerings include OSX Luxury Sportboats and
SSi Outboard Bowriders. Robalo builds an array of outboard sport
fishing boats, which include Center Consoles, Dual Consoles and
Cayman Bay Boats.
For the quarter ended September 30,
2023, Marine Products generated net sales of $77.8 million, a 22 percent decrease compared to
$100.1 million in the third quarter
of the prior year. The decrease in net sales was primarily due to a
24 percent decrease in the number of boats sold during the quarter,
partially offset by a five percent increase in average selling
price. Average selling price per boat increased primarily due to a
favorable model mix and, to a lesser extent, price increases to
cover higher costs of materials and components. Unit sales
decreased during the quarter compared to the prior year as
production has been adjusted to align more with current demand,
including seasonally lower dealer demand during the third quarter
of each calendar year. In addition, unit sales were impacted during
the quarter by severe weather-related production shutdowns.
Gross profit for the third quarter of 2023 was $19.2 million compared to $25.0 million in the third quarter of the prior
year. Gross margin as a percentage of net sales was 24.7 percent in
the third quarter of 2023 compared to 25.0 percent in the prior
year period. Operating income for the third quarter of 2023 was
$12.4 million, a decrease of 15
percent compared to operating profit of $14.7 million in the third quarter of the prior
year. Selling, general and administrative expenses were
$8.8 million in the third quarter of
2023 compared to $10.3 million in the
third quarter of 2022. The decrease in selling, general and
administrative expenses was due to costs that vary with sales and
profitability, such as incentive compensation, sales commissions
and warranty expense. These expenses were 11.3 percent of net sales
in the third quarter of 2023 compared to 10.3 percent in the third
quarter of 2022.
Net gain on the disposition of assets was $2.0 million during the quarter, which includes
$1.8 million related to a real estate
transaction. Net interest income of $860
thousand increased significantly compared to the prior year
due to a higher cash balance and higher interest yields.
Net income for the third quarter of 2023 was $10.4 million, a decrease of 9 percent compared
to net income of $11.5 million in the
third quarter of 2022. Net income as a percentage of net sales was
13.4 percent in the third quarter of 2023 as compared to 11.5
percent in the prior year period. Earnings before interest, taxes,
depreciation and amortization (EBITDA)1 for the third
quarter of 2023 was $13.0 million, a
decrease of 14 percent, compared to $15.2
million in the third quarter of 2022. EBITDA as a percentage
of net sales was 16.7 percent in the third quarter of 2023 as
compared to 15.1 percent in the prior year period.
Diluted earnings per share in the third quarter of 2023 were
$0.30, a decrease of 12 percent
compared to $0.34 in the third
quarter of the prior year. The effective tax rate was 21.6 percent
in the third quarter of 2023 compared to 22.3 percent in the third
quarter of 2022.
Net sales for the nine months ended September 30, 2023 were $312.9 million, an increase of 15 percent
compared to the first nine months of 2022. Net income for the
nine-month period was $36.3 million
or $1.05 diluted earnings per share,
compared to net income of $28.5
million or $0.83 diluted
earnings per share in the comparable prior year period.
"Our third quarter results reflect the reduction in production
and delivery rates due to normalization of retail boat demand that
has occurred during 2023, following significant post-COVID demand.
In addition, our production in the third quarter was adversely
impacted by Hurricane Idalia," stated Ben
M. Palmer, Marine Products' President and Chief Executive
Officer. "We were pleased with the orders placed during our annual
dealer conference in August. Dealer inventories are reasonable by
historical standards and remain below pre-pandemic levels, and we
have firm production scheduled into 2024. We, along with our
dealers, will reassess retail demand during the winter boat shows.
While we are still experiencing some delays in timely receipts of
certain components used in our manufacturing operations, these
issues are less of a problem than earlier this year," concluded
Palmer.
Marine Products Corporation will hold a conference call today,
October 25, 2023, at 8:00 a.m. Eastern Time to discuss the results for
the quarter. Interested parties may listen in by accessing a
live webcast in the investor relations section of Marine Products'
website at marineproductscorp.com. Additionally, the live
conference call can be accessed by calling (888) 660-6357, or (929)
201-6127 for international callers, and using conference ID number
9979064. A replay will be available in the investor relations
section of Marine Products' website beginning approximately two
hours after the call.
Marine Products Corporation is a leading manufacturer of
high-quality fiberglass boats under the brand names Chaparral and
Robalo. Chaparral's sterndrive models include SSi Sportboats
and SSX Luxury Sportboats, and the SURF Series. Chaparral's
outboard offerings include OSX Luxury Sportboats and the SSi
Outboard Bowriders. Robalo builds an array of outboard sport
fishing models, which include Center Consoles, Dual Consoles and
Cayman Bay Boats. The Company continues to diversify its product
lines through product innovation. With these premium brands,
a solid capital structure, and a strong independent dealer network,
Marine Products Corporation is prepared to capitalize on
opportunities to increase its market share and generate superior
financial performance to build long-term shareholder value.
For more information on Marine Products Corporation visit our
website at MarineProductsCorp.com.
Certain statements and information included in this press
release constitute "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. Such
forward-looking statements include statements that look forward in
time or express management's beliefs, expectations or hopes.
In particular, such statements include, without limitation, the
statement regarding our belief that dealer inventories are
reasonable by historical standards and our belief that we are
prepared to capitalize on opportunities to increase our market
share and generate superior financial performance to build
long-term shareholder value. Risk factors that could cause such
future events not to occur as expected include the following: our
manufacturing operations and our supply chain; economic conditions,
unavailability of credit and possible decreases in the level of
consumer confidence impacting discretionary spending; business
interruptions due to adverse weather conditions, increased interest
rates. Additional discussion of factors that could cause the
actual results to differ materially from management's projections,
forecasts, estimates and expectations is contained in Marine
Products' Annual Report on Form 10-K, filed with the U.S.
Securities and Exchange Commission (the "SEC") for the year ended
December 31, 2022.
_________________________
1 EBITDA and EBITDA as a percentage of net sales are
financial measures which do not conform to GAAP. Additional
disclosure regarding these non-GAAP financial measures and their
reconciliations to the nearest GAAP financial measures, is
disclosed in Appendix A to this press release.
For information about Marine Products Corporation or this event,
please contact:
Michael L.
Schmit
Chief Financial Officer
(404) 321-7910
irdept@marineproductscorp.com
Jim Landers
Vice President Corporate Services
(404) 321-2162
jlanders@marineproductscorp.com
MARINE PRODUCTS
CORPORATION AND SUBSIDIARIES
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CONSOLIDATED
STATEMENTS OF OPERATIONS (In thousands except per
share data)
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Periods ended September
30, (Unaudited)
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Third
Quarter
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Nine
Months
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2023
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2022
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2023
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2022
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|
Net
sales
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$
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77,786
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$
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100,061
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$
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312,858
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$
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272,486
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Cost of goods
sold
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58,548
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75,056
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235,942
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206,089
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Gross
profit
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19,238
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25,005
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76,916
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66,397
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Selling, general and
administrative expenses
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8,789
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10,326
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35,495
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29,449
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Gain on disposition of
assets, net
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(1,962)
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-
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(1,962)
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-
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Operating
income
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12,411
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14,679
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43,383
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36,948
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Interest income,
net
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860
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|
76
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2,066
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52
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Income before income
taxes
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|
13,271
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14,755
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45,449
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37,000
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Income tax
provision
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2,868
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3,283
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9,176
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8,510
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Net
income
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$
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10,403
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$
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11,472
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$
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36,273
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$
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28,490
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EARNINGS PER
SHARE
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Basic
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$
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0.30
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$
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0.34
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$
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1.05
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$
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0.83
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Diluted
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$
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0.30
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$
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0.34
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$
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1.05
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$
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0.83
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AVERAGE SHARES
OUTSTANDING
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Basic
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34,467
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34,225
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34,435
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34,172
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Diluted
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34,467
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34,225
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34,435
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34,172
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MARINE PRODUCTS
CORPORATION AND SUBSIDIARIES
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CONSOLIDATED
BALANCE SHEETS
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(in
thousands)
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SEPTEMBER 30,
2023
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DECEMBER 31,
2022
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(Unaudited)
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ASSETS
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Cash and cash
equivalents
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$
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60,705
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$
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43,171
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Accounts receivable,
net
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10,743
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5,340
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Inventories
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69,784
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73,015
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Income taxes
receivable
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199
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28
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Prepaid expenses and
other current assets
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3,784
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3,444
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Total current
assets
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145,215
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124,998
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Property, plant and
equipment, net
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21,356
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14,965
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Goodwill
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3,308
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3,308
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Other intangibles,
net
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465
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465
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Deferred income
taxes
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7,833
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6,027
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Other assets
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18,556
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13,952
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Total
assets
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$
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196,733
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$
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163,715
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LIABILITIES AND
STOCKHOLDERS' EQUITY
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Accounts
payable
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$
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12,066
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$
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8,250
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Accrued expenses and
other liabilities
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16,218
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15,340
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Total current
liabilities
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28,284
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23,590
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Retirement plan
liabilities
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16,714
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14,440
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Other long-term
liabilities
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1,622
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1,304
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Total
liabilities
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46,620
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39,334
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Common
stock
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3,447
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3,422
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Capital in excess of
par value
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-
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-
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Retained
earnings
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146,678
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122,954
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Accumulated other
comprehensive loss
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(12)
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(1,995)
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Total
stockholders' equity
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150,113
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124,381
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Total
liabilities and stockholders' equity
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$
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196,733
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$
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163,715
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Appendix A
Marine Products Corporation has used the non-GAAP financial
measures of earnings before interest, taxes, depreciation and
amortization (EBITDA) in today's earnings release, and anticipates
using them in today's earnings conference call. They should
not be considered in isolation or as a substitute for operating
income, net income or other performance measures prepared in
accordance with GAAP.
Marine Products Corporation uses EBITDA as a measure of
operating performance because they allow us to compare performance
consistently over various periods without regard to changes in our
capital structure.
A non-GAAP financial measure is a numerical measure of financial
performance, financial position, or cash flows that either 1)
excludes amounts, or is subject to adjustments that have the effect
of excluding amounts, that are included in the most directly
comparable measure calculated and presented in accordance with GAAP
in the statement of operations, balance sheet or statement of cash
flows, or 2) includes amounts, or is subject to adjustments that
have the effect of including amounts, that are excluded from the
most directly comparable measure so calculated and presented. Set
forth below is a reconciliation of EBITDA with Net Income, the most
comparable GAAP measure. These reconciliations also appears on
Marine Products Corporation's investor website, which can be found
on the Internet at marineproductscorp.com.
(Unaudited)
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Periods ended September
30,
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Three Months
Ended
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Nine Months
Ended
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(In
thousands)
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2023
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2022
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2023
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2022
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Reconciliation of
Net Income to EBITDA
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Net Income
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$
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10,403
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$
|
11,472
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$
|
36,273
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$
|
28,490
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Add:
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Income tax
provision
|
|
2,868
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|
|
3,283
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|
|
9,176
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8,510
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Depreciation and
amortization
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|
610
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|
480
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1,750
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1,416
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Less:
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|
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|
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Interest income,
net
|
|
860
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|
|
76
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|
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2,066
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|
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52
|
EBITDA
|
$
|
13,021
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$
|
15,159
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$
|
45,133
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$
|
38,364
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SOURCE Marine Products Corporation