MarineMax Reports Fiscal 2024 Second Quarter Results

~ Posts March Quarter Revenue of $582.9 Million, Up 2% Year-over-Year ~

~ Reports Comparable Same-Store Sales Growth of 2% ~

~ Revises Fiscal 2024 Financial Guidance ~

~ Hosts Earnings Conference Call at 10:00 a.m. ET Today ~

MarineMax, Inc. (NYSE: HZO), the world’s largest recreational boat, yacht and superyacht services company, today announced results for its second quarter ended March 31, 2024.

Fiscal 2024 Second Quarter Summary

  • March quarter revenue of $582.9 million
  • Same-store sales increase of 2%
  • Gross profit margin of 32.7%
  • Net income of $1.6 million, or diluted EPS of $0.07; Adjusted diluted EPS1 of $0.18
  • Adjusted EBITDA1 of $29.6 million

CEO & President Commentary

“Although we continue to operate in a challenging market environment, as evidenced by industrywide larger than expected declines in boat registrations, we drove an increase in sales in the second quarter. Our gross margin also remains strong as a direct result of the strategic growth in our higher-margin businesses,” said Brett McGill, Chief Executive Officer and President of MarineMax. “Our performance was impacted by ongoing softness in the marine market, highlighting broader macroeconomic concerns including elevated interest rates and persistent inflation. While interest in boating remains encouraging, more aggressive promotional activity was required to assist consumers in making purchase decisions.

“We continue to focus on driving growth through investments in strong, higher-margin businesses that enhance the customer experience and expand our margin profile. During the quarter, we completed the purchase of Williams Tenders USA. This transaction advances our growth strategy, giving MarineMax distribution exclusivity in the U.S. and the Caribbean for the world’s premier brand of rigid inflatable jet tenders for the luxury yacht market.

“We are taking additional steps to reduce expenses while maintaining our customer experience and service. These additional measures are directed at better aligning our cost structure with the current environment. Our actions will enhance our strong cash position and healthy balance sheet, positioning us for greater opportunities as market conditions improve,” McGill said.

Fiscal 2024 Second Quarter Results

Revenue in the fiscal 2024 second quarter increased 2% to $582.9 million from $570.3 million in the comparable period last year. The top-line growth was primarily driven by an increase in boat sales. On a comparable same-store basis, revenue increased 2%.

Gross profit decreased 5.2% to $190.4 million from $200.9 million in the prior-year period. Gross profit margin of 32.7% decreased 250 basis points from 35.2% in the comparable period last year, as a higher level of promotional activity amid challenging retail conditions resulted in lower boat margins.

Selling, general, and administrative (SG&A) expenses totaled $169.0 million, or 29.0% of revenue, in the second quarter, compared with $145.5 million, or 25.5% of revenue, for the comparable period last year. Excluding transaction costs, changes in contingent consideration, weather events and other non-recurring items in the 2024 period, adjusted SG&A increased $16.4 million, or 11%, from the same period in fiscal 2023.

Interest expense was $19.4 million, or 3.3% of revenue in the second quarter, compared with $13.3 million, or 2.3% of revenue in the prior-year period, reflecting higher interest rates and increased inventory compared with the second quarter of fiscal 2023.

Net income in the second quarter was $1.6 million, or $0.07 per diluted share, compared with net income of $30.0 million, or $1.35 per diluted share, in the same period last year. Adjusted net income1 in the second quarter was $4.1 million, or $0.18 per diluted share, compared with $27.4 million, or $1.23 per diluted share, in the prior-year period. Adjusted EBITDA1 for the quarter ended March 31, 2024, was $29.6 million, compared with $57.4 million for the comparable period last year.

Company Revises Fiscal 2024 Guidance

Based on results to date, current business conditions, retail trends and other factors, the Company is updating its fiscal year 2024 Adjusted net income1,2 guidance to a range of $2.20 to $3.20 per diluted share. The Company also is revising fiscal year 2024 Adjusted EBITDA1,2 guidance to a range of $155 million to $190 million. These expectations do not consider or give effect for, among other things, material acquisitions that may be completed by the Company during fiscal 2024 or other unforeseen events, including changes in global economic conditions.

Conference Call Information

MarineMax will discuss its fiscal 2024 second quarter financial results on a conference call starting at 10:00 a.m. ET today. The conference call can be accessed via the “Investors” section of the Company's website: www.marinemax.com, or by dialing 877-407-0789 (U.S. and Canada) or 201-689-8562 (International). An online replay will be available within one hour of the conclusion of the call and will be archived on the website for one year.

About MarineMax

As the world’s largest lifestyle retailer of recreational boats and yachts, as well as yacht concierge and superyacht services, MarineMax (NYSE: HZO) is United by Water. We have over 130 locations worldwide, including 83 dealerships and 66 marina and storage facilities. Our integrated business includes IGY Marinas, which operates luxury marinas in yachting and sport fishing destinations around the world; Fraser Yachts Group and Northrop & Johnson, leading superyacht brokerage and luxury yacht services companies; Cruisers Yachts, one of the world’s premier manufacturers of premium sport yachts and motor yachts; and Intrepid Powerboats, a premier manufacturer of powerboats. To enhance and simplify the customer experience, we provide financing and insurance services as well as leading digital technology products that connect boaters to a network of preferred marinas, dealers, and marine professionals through Boatyard and Boatzon. In addition, we operate MarineMax Vacations in Tortola, British Virgin Islands, which offers our charter vacation guests the luxury boating adventures of a lifetime. Land comprises 29% of the earth’s surface. We’re focused on the other 71%. Learn more at www.marinemax.com.

Forward-Looking Statement

Certain statements in this press release are forward-looking as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include ongoing softness in the marine market, more aggressive promotional activity, the Company’s focus on driving growth through the acquisition of strong, higher-margin businesses, the Company’s strategy to invest in brands, products and services that enhance the customer experience and expand the Company’s margin profile, the Company’s operational improvement measures and the related expected annualized cost savings and our fiscal 2024 guidance. These statements are based on current expectations, forecasts, risks, uncertainties, and assumptions that may cause actual results to differ materially from expectations as of the date of this release. These risks, assumptions, and uncertainties include the Company’s abilities to reduce inventory, manage expenses and accomplish its goals and strategies, the quality of the new product offerings from the Company’s manufacturing partners, the performance and integration of the recently-acquired businesses, general economic conditions, as well as those within the Company's industry, the liquidity and strength of our bank group partners, the level of consumer spending, and numerous other factors identified in the Company’s Form 10-K for the fiscal year ended September 30, 2023 and other filings with the Securities and Exchange Commission. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

____________________

1 This is a non-GAAP measure. See below for an explanation and quantitative reconciliation of each non-GAAP financial measure.

2 See “Non-GAAP Financial Measures” below for a discussion of why reconciliations of forward-looking Adjusted Net Income and Adjusted EBITDA are not available without unreasonable effort.

 

MarineMax, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Revenue

 

$

582,892

 

 

$

570,340

 

 

$

1,110,166

 

 

$

1,078,267

 

Cost of sales

 

 

392,471

 

 

 

369,431

 

 

 

744,264

 

 

 

690,461

 

Gross profit

 

 

190,421

 

 

 

200,909

 

 

 

365,902

 

 

 

387,806

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Selling, general, and administrative expenses

 

 

169,020

 

 

 

145,504

 

 

 

325,502

 

 

 

295,901

 

Income from operations

 

 

21,401

 

 

 

55,405

 

 

 

40,400

 

 

 

91,905

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense

 

 

19,374

 

 

 

13,280

 

 

 

37,739

 

 

 

22,764

 

Income before income tax provision

 

 

2,027

 

 

 

42,125

 

 

 

2,661

 

 

 

69,141

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income tax provision

 

 

578

 

 

 

12,201

 

 

 

367

 

 

 

19,230

 

Net income

 

 

1,449

 

 

 

29,924

 

 

 

2,294

 

 

 

49,911

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Net (loss) income attributable to non-controlling interests

 

 

(138

)

 

 

(111

)

 

 

(223

)

 

 

186

 

Net income attributable to MarineMax, Inc.

 

$

1,587

 

 

$

30,035

 

 

$

2,517

 

 

$

49,725

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic net income per common share

 

$

0.07

 

 

$

1.37

 

 

$

0.11

 

 

$

2.28

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per common share

 

$

0.07

 

 

$

1.35

 

 

$

0.11

 

 

$

2.23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average number of common shares used in computing net income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

22,299,599

 

 

 

21,853,557

 

 

 

22,247,587

 

 

 

21,804,326

 

Diluted

 

 

22,999,229

 

 

 

22,314,262

 

 

 

22,903,840

 

 

 

22,268,183

 

 

MarineMax, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Amounts in thousands)

(Unaudited)

 

 

 

March 31,

 

 

March 31,

 

 

 

2024

 

 

2023

 

ASSETS

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

Cash and cash equivalents

 

$

216,684

 

 

$

204,339

 

Accounts receivable, net

 

 

121,639

 

 

 

116,910

 

Inventories

 

 

932,607

 

 

 

711,296

 

Prepaid expenses and other current assets

 

 

21,996

 

 

 

21,710

 

Total current assets

 

 

1,292,926

 

 

 

1,054,255

 

Property and equipment, net

 

 

536,175

 

 

 

499,418

 

Operating lease right-of-use assets, net

 

 

140,882

 

 

 

138,525

 

Goodwill

 

 

590,344

 

 

 

558,613

 

Other intangible assets, net

 

 

39,174

 

 

 

42,134

 

Other long-term assets

 

 

31,488

 

 

 

31,783

 

Total assets

 

$

2,630,989

 

 

$

2,324,728

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

Accounts payable

 

$

61,339

 

 

$

44,598

 

Contract liabilities (customer deposits)

 

 

79,095

 

 

 

113,934

 

Accrued expenses

 

 

124,332

 

 

 

113,803

 

Short-term borrowings

 

 

736,717

 

 

 

498,647

 

Current maturities on long-term debt

 

 

33,766

 

 

 

32,409

 

Current operating lease liabilities

 

 

10,359

 

 

 

9,981

 

Total current liabilities

 

 

1,045,608

 

 

 

813,372

 

Long-term debt, net of current maturities

 

 

372,624

 

 

 

407,335

 

Noncurrent operating lease liabilities

 

 

126,224

 

 

 

121,813

 

Deferred tax liabilities, net

 

 

58,156

 

 

 

47,638

 

Other long-term liabilities

 

 

87,919

 

 

 

83,310

 

Total liabilities

 

 

1,690,531

 

 

 

1,473,468

 

SHAREHOLDERS' EQUITY:

 

 

 

 

 

 

Preferred stock

 

 

 

 

 

 

Common stock

 

 

29

 

 

 

29

 

Additional paid-in capital

 

 

334,939

 

 

 

313,848

 

Accumulated other comprehensive income

 

 

2,531

 

 

 

3,013

 

Retained earnings

 

 

742,466

 

 

 

680,392

 

Treasury stock

 

 

(148,656

)

 

 

(148,656

)

Total shareholders’ equity attributable to MarineMax, Inc.

 

 

931,309

 

 

 

848,626

 

Non-controlling interests

 

 

9,149

 

 

 

2,634

 

Total shareholders’ equity

 

 

940,458

 

 

 

851,260

 

Total liabilities and shareholders’ equity

 

$

2,630,989

 

 

$

2,324,728

 

 

MarineMax, Inc. and Subsidiaries

Segment Financial Information

(Amounts in thousands)

(Unaudited)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Revenue:

 

 

 

 

 

 

 

 

 

 

 

 

Retail Operations

 

$

579,177

 

 

$

558,872

 

 

$

1,103,262

 

 

$

1,061,258

 

Product Manufacturing

 

 

40,182

 

 

 

56,749

 

 

 

86,310

 

 

 

113,075

 

Elimination of intersegment revenue

 

 

(36,467

)

 

 

(45,281

)

 

 

(79,406

)

 

 

(96,066

)

Revenue

 

$

582,892

 

 

$

570,340

 

 

$

1,110,166

 

 

$

1,078,267

 

Income from operations:

 

 

 

 

 

 

 

 

 

 

 

 

Retail Operations

 

$

20,665

 

 

$

53,737

 

 

$

35,470

 

 

$

90,465

 

Product Manufacturing

 

 

(914

)

 

 

6,243

 

 

 

3,056

 

 

 

12,745

 

Intersegment adjustments

 

 

1,650

 

 

 

(4,575

)

 

 

1,874

 

 

 

(11,305

)

Income from operations

 

$

21,401

 

 

$

55,405

 

 

$

40,400

 

 

$

91,905

 

 

MarineMax, Inc. and Subsidiaries

Supplemental Financial Information

(Amounts in thousands, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Net income attributable to MarineMax, Inc.

 

$

1,587

 

 

$

30,035

 

 

$

2,517

 

 

$

49,725

 

Transaction costs (1)

 

 

119

 

 

 

80

 

 

 

3,225

 

 

 

6,116

 

Intangible amortization (2)

 

 

1,429

 

 

 

1,890

 

 

 

3,163

 

 

 

3,595

 

Change in fair value of contingent consideration (3)

 

 

949

 

 

 

1,183

 

 

 

1,167

 

 

 

2,230

 

Weather expenses (recoveries)

 

 

987

 

 

 

(1,685

)

 

 

698

 

 

 

(191

)

Gain on acquisition of equity investment (4)

 

 

 

 

 

(5,129

)

 

 

 

 

 

(5,129

)

Tax adjustments for items noted above (5)

 

 

(993

)

 

 

1,062

 

 

 

(1,139

)

 

 

(1,841

)

Adjusted net income attributable to MarineMax, Inc.

 

$

4,078

 

 

$

27,436

 

 

$

9,631

 

 

$

54,505

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted net income per common share

 

$

0.07

 

 

$

1.35

 

 

$

0.11

 

 

$

2.23

 

Transaction costs (1)

 

 

0.01

 

 

 

 

 

 

0.14

 

 

 

0.27

 

Intangible amortization (2)

 

 

0.06

 

 

 

0.08

 

 

 

0.14

 

 

 

0.16

 

Change in fair value of contingent consideration (3)

 

 

0.04

 

 

 

0.05

 

 

 

0.05

 

 

 

0.10

 

Weather expenses (recoveries)

 

 

0.04

 

 

 

(0.08

)

 

 

0.03

 

 

 

(0.01

)

Gain on acquisition of equity investment (4)

 

 

 

 

 

(0.22

)

 

 

 

 

 

(0.22

)

Tax adjustments for items noted above (5)

 

 

(0.04

)

 

 

0.05

 

 

 

(0.05

)

 

 

(0.08

)

Adjusted diluted net income per common share

 

$

0.18

 

 

$

1.23

 

 

$

0.42

 

 

$

2.45

 

(1)

 

Transactions costs relate to acquisition transaction and integration costs in the period.

(2)

 

Represents amortization expense for acquisition-related intangible assets.

(3)

 

Represents expenses to record contingent consideration liabilities at fair value.

(4)

 

Represents gain on a previously held equity investment upon acquisition of the entire business.

(5)

 

Adjustments for taxes for items are calculated based on the effective tax rate for each respective period presented.

 

 

 

Three Months Ended

 

 

Six Months Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2024

 

 

2023

 

 

2024

 

 

2023

 

Net income attributable to MarineMax, Inc.

 

$

1,587

 

 

$

30,035

 

 

$

2,517

 

 

$

49,725

 

Interest expense (excluding floor plan)

 

 

7,522

 

 

 

6,819

 

 

 

15,278

 

 

 

13,184

 

Income tax provision

 

 

578

 

 

 

12,201

 

 

 

367

 

 

 

19,230

 

Depreciation and amortization

 

 

10,965

 

 

 

8,853

 

 

 

21,897

 

 

 

17,972

 

Stock-based compensation expense

 

 

5,984

 

 

 

5,368

 

 

 

11,402

 

 

 

10,213

 

Transaction costs

 

 

119

 

 

 

80

 

 

 

3,225

 

 

 

6,116

 

Gain on acquisition of equity investment

 

 

 

 

 

(5,129

)

 

 

 

 

 

(5,129

)

Change in fair value of contingent consideration

 

 

949

 

 

 

1,183

 

 

 

1,167

 

 

 

2,230

 

Weather expenses (recoveries)

 

 

987

 

 

 

(1,685

)

 

 

698

 

 

 

(191

)

Foreign currency

 

 

908

 

 

 

(371

)

 

 

(308

)

 

 

(2,801

)

Adjusted EBITDA

 

$

29,599

 

 

$

57,354

 

 

$

56,243

 

 

$

110,549

 

Non-GAAP Financial Measures

This press release, along with the above Supplemental Financial Information table, contains “Adjusted net income”, “Adjusted diluted EPS” and “Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization” (“Adjusted EBITDA”), which are non-GAAP financial measures as defined under applicable securities legislation. In determining these measures, the Company excludes certain items which are otherwise included in determining the comparable GAAP financial measures. The Company believes these non-GAAP financial measures are key performance indicators that improve the period-to-period comparability of the Company’s results and provide investors with more insight into, and an additional tool to understand and assess, the performance of the Company's ongoing core business operations. Investors and other readers are encouraged to review the related GAAP financial measures and the above reconciliation and should consider these non-GAAP financial measures as a supplement to, and not as a substitute for or as a superior measure to, measures of financial performance prepared in accordance with GAAP.

In addition, we have not reconciled our fiscal year 2024 Adjusted earnings and Adjusted EBITDA guidance to net income (the corresponding GAAP measure for each), which is not accessible on a forward-looking basis due to the high variability and difficulty in making accurate forecasts and projections, particularly with respect to acquisition contingent consideration and acquisition costs. Acquisition contingent consideration and transaction costs, which are likely to be significant to the calculation of net income, are affected by the integration and post-acquisition performance of our acquirees, which is difficult to predict and subject to change. Accordingly, reconciliations of forward-looking Adjusted earnings and Adjusted EBITDA are not available without unreasonable effort.

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