Revenues from strategic acquisitions partially
offset a decrease in boat sales that reflect a return to
seasonality amid uncertain economic environment
MarineMax, Inc. (NYSE: HZO), the world’s largest recreational
boat, yacht, and superyacht services company, today announced
results for its fiscal second quarter ended March 31, 2023.
Fiscal 2023 Second Quarter Highlights
- Revenue of $570.3 million
- Record second-quarter gross margin of 35.2%
- Net income of $30.0 million, or diluted EPS of $1.35; Adjusted
diluted EPS of $1.23
- Adjusted EBITDA of $57.4 million
- Company updates fiscal 2023 outlook
- Earnings call at 10:00 a.m. ET today
CEO & President Commentary
“After the exceptionally strong results we saw throughout fiscal
2022, our second quarter fiscal 2023 revenue reflected the boat
industry’s return to more seasonal sales trends, coupled with the
ongoing macroeconomic uncertainty, which grew more impactful as the
quarter progressed,” stated Brett McGill, MarineMax’s Chief
Executive Officer and President. “Against that backdrop our team
executed well, delivering a solid top line and record second
quarter gross margin. Our performance was highlighted by growth
across most of our higher-margin businesses and the contribution of
our strategic acquisitions, including IGY Marinas, which continues
to exceed our expectations.
“During the past several years, MarineMax has structurally
enhanced its margin profile through a focused combination of
acquisitions and organic initiatives that have expanded our
footprint across high-growth areas of the marine industry,
including marinas, finance and insurance, and superyacht services,”
Mr. McGill continued. “While the unprecedented inventory shortages
and lower interest rate environment of fiscal 2022 create a very
difficult comparison for us this year, our results in historical
context demonstrate clearly that our growth strategy is paying off,
despite the macroeconomic volatility. Compared with the first six
months of fiscal 2019, our revenue through the same period in
fiscal 2023 has almost doubled to $1.1 billion, gross margin has
climbed more than 1000 basis points to 36% and diluted EPS has
increased more than fivefold to $2.23. The initiatives we have
taken have enabled us to build scale in new and exciting areas of
the market that, over time, have the ability to dramatically
increase both our recurring revenue and our earnings power,
reducing our exposure to normal seasonal trends.
“Although we are revising our fiscal 2023 guidance to reflect
our year-to-date performance and appropriately address the economic
uncertainty, we remain extremely confident in the underlying
fundamentals of our business and our ability to outperform the
market over the long term,” Mr. McGill concluded. “We continue to
balance prudent expense management with investments to generate
sustained profitable growth. As we head into the traditionally
strong summer selling season, our historically high backlog and
strong customer demand reflect worldwide enthusiasm for boating as
well as the demand for the high-quality products and services we
are delivering to this global market.”
Fiscal 2023 Second Quarter Results
Revenue in the fiscal 2023 second quarter was down 7% to $570.3
million from record March quarter revenue of $610.1 million in the
comparable period last year. This result was primarily attributable
to decreases in new and used boat revenue, resulting in 13% lower
same-store sales compared with same-store sales increases of 7% in
the second quarter of fiscal 2022 and 45% in the second quarter of
fiscal 2021. The decrease in same-store sales was partly offset by
contributions from IGY Marinas and boat manufacturing revenue,
sources that are not included in the same-store sales
comparison.
Gross profit totaled $200.9 million in the second quarter, down
2% from $205.3 million in the prior-year period, due primarily to
the decreases in revenue. Gross profit margin of 35.2% increased
150 basis points from 33.7% in the fiscal 2022 second quarter,
primarily driven by the acquisition of IGY Marinas and growth in
higher margin businesses.
Selling, general, and administrative expenses totaled $145.5
million, or 25.5% of revenue, in the second quarter compared with
$133.5 million, or 21.9% of revenue, for the same period last year,
primarily reflecting the addition of IGY Marinas.
Interest expense increased to $13.3 million in the second
quarter from $0.7 million in the prior-year period, reflecting
higher interest rates as well as the increase in long-term debt
related to the IGY Marinas acquisition and increased inventory.
Net income in the second quarter was $30.0 million, or $1.35 per
diluted share, compared with net income of $53.5 million, or $2.37
per diluted share, in the same period last year.
Adjusted net income1 in the second quarter was $27.4 million, or
$1.23 per diluted share, compared with $54.1 million, or $2.40 per
diluted share, in the prior-year period. Adjusted EBITDA1 for the
quarter ended March 31, 2023 was $57.4 million, compared with $80.3
million for the same period last year.
Fiscal 2023 Guidance
Based on results to date, current business conditions, retail
trends and other factors, the Company is updating its fiscal year
2023 guidance for Adjusted earnings2 to a range of $4.90 to $5.50
per diluted share and Adjusted EBITDA2 to a range of $220 million
to $245 million. These expectations do not consider, or give effect
for, among other things, material acquisitions that may be
completed by the Company during fiscal 2023 or other unforeseen
events, including changes in global economic conditions.
Conference Call Information
MarineMax will discuss its fiscal 2023 second quarter results
and outlook in 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: http://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 more than 125
locations worldwide, including 78 dealerships and 57 marinas. 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 Statements
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 the ability of the
Company's initiatives to increase the Company’s recurring revenue
and earnings power over time, the underlying fundamentals of the
Company’s business, the Company’s long-term market outlook and its
fiscal 2023 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 and its
manufacturing partners, the performance and integration of the
recently-acquired businesses, general economic conditions, as well
as those within the Company's industry, the level of consumer
spending, and numerous other factors identified in the Company’s
Form 10-K for the fiscal year ended September 30, 2022 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 earnings 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,
2023
2022
2023
2022
Revenue
$
570,340
$
610,106
$
1,078,267
$
1,082,797
Cost of sales
369,431
404,791
690,461
710,283
Gross profit
200,909
205,315
387,806
372,514
Selling, general, and administrative
expenses
145,504
133,532
295,901
253,529
Income from operations
55,405
71,783
91,905
118,985
Interest expense
13,280
654
22,764
1,291
Income before income tax provision
42,125
71,129
69,141
117,694
Income tax provision
12,201
17,622
19,230
28,244
Net income
29,924
53,507
49,911
89,450
Less: Net (loss) income attributable to
non-controlling interests
(111
)
—
186
—
Net income attributable to MarineMax,
Inc.
$
30,035
$
53,507
$
49,725
$
89,450
Basic net income per common share
$
1.37
$
2.45
$
2.28
$
4.09
Diluted net income per common share
$
1.35
$
2.37
$
2.23
$
3.96
Weighted average number of common shares
used in computing net income per common share:
Basic
21,853,557
21,861,438
21,804,326
21,880,558
Diluted
22,314,262
22,530,102
22,268,183
22,597,105
MarineMax, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(Amounts in thousands)
(Unaudited)
March 31,
March 31,
2023
2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
204,339
$
219,400
Accounts receivable, net
116,910
62,276
Inventories
711,296
329,731
Prepaid expenses and other current
assets
21,710
17,596
Total current assets
1,054,255
629,003
Property and equipment, net
499,418
220,569
Operating lease right-of-use assets,
net
138,525
100,818
Goodwill
558,613
234,532
Other intangible assets, net
42,134
11,733
Other long-term assets
31,783
9,069
Total assets
$
2,324,728
$
1,205,724
LIABILITIES AND SHAREHOLDERS’
EQUITY
CURRENT LIABILITIES:
Accounts payable
$
44,598
$
37,856
Contract liabilities (customer
deposits)
113,934
164,068
Accrued expenses
113,803
95,750
Short-term borrowings
498,647
58,858
Current maturities on long-term debt
32,409
3,587
Current operating lease liabilities
9,981
9,774
Total current liabilities
813,372
369,893
Long-term debt, net of current
maturities
407,335
45,747
Noncurrent operating lease liabilities
121,813
93,885
Deferred tax liabilities, net
47,638
14,646
Other long-term liabilities
83,310
7,293
Total liabilities
1,473,468
531,464
SHAREHOLDERS' EQUITY:
Preferred stock
—
—
Common stock
29
29
Additional paid-in capital
313,848
295,589
Accumulated other comprehensive income
3,013
147
Retained earnings
680,392
522,128
Treasury stock
(148,656
)
(143,633
)
Total shareholders’ equity attributable to
MarineMax, Inc.
848,626
674,260
Non-controlling interests
2,634
—
Total shareholders’ equity
851,260
674,260
Total liabilities and shareholders’
equity
$
2,324,728
$
1,205,724
MarineMax, Inc. and
Subsidiaries
Segment Financial
Information
(Amounts in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
March 31,
March 31,
2023
2022
2023
2022
Revenue:
Retail Operations
$
540,195
$
577,624
$
1,019,881
$
1,032,242
Product Manufacturing
56,749
46,758
113,075
81,002
Elimination of intersegment revenue
(26,604
)
(14,276
)
(54,689
)
(30,447
)
Revenue
$
570,340
$
610,106
$
1,078,267
$
1,082,797
Income from operations:
Retail Operations
$
53,737
$
68,346
$
90,465
$
113,469
Product Manufacturing
6,243
4,387
12,745
7,830
Elimination of intersegment income from
operations
(4,575
)
(950
)
(11,305
)
(2,314
)
Income from operations
$
55,405
$
71,783
$
91,905
$
118,985
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,
2023
2022
2023
2022
Net income attributable to MarineMax,
Inc.
$
30,035
$
53,507
$
49,725
$
89,450
Acquisition costs (1)
80
16
6,116
517
Intangible amortization (2)
1,890
625
3,595
1,136
Change in fair value of contingent
consideration (3)
1,183
125
2,230
235
Hurricane expenses (recoveries)
(1,685
)
—
(191
)
—
Gain on acquisition of equity investment
(4)
(5,129
)
—
(5,129
)
—
Tax adjustments for items noted above
(5)
1,062
(190
)
(1,841
)
(453
)
Adjusted net income attributable to
MarineMax, Inc.
$
27,436
$
54,083
$
54,505
$
90,885
Diluted net income per common share
$
1.35
$
2.37
$
2.23
$
3.96
Acquisition costs (1)
—
—
0.27
0.02
Intangible amortization (2)
0.08
0.03
0.16
0.05
Change in fair value of contingent
consideration (3)
0.05
0.01
0.10
0.01
Hurricane expenses (recoveries)
(0.08
)
—
(0.01
)
—
Gain on acquisition of equity investment
(4)
(0.22
)
—
(0.22
)
—
Tax adjustments for items noted above
(5)
0.05
(0.01
)
(0.08
)
(0.02
)
Adjusted diluted net income per common
share
$
1.23
$
2.40
$
2.45
$
4.02
(1)
Acquisition costs relate to acquisition
transaction 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 and the jurisdiction of the adjustment.
Three Months Ended
Six Months Ended
March 31,
March 31,
2023
2022
2023
2022
Net income attributable to MarineMax,
Inc.
$
30,035
$
53,507
$
49,725
$
89,450
Interest expense (excluding floor
plan)
6,819
308
13,184
623
Income tax provision
12,201
17,622
19,230
28,244
Depreciation and amortization
8,853
4,807
17,972
9,304
Stock-based compensation expense
5,368
3,912
10,213
7,175
Acquisition costs
80
16
6,116
517
Gain on acquisition of equity
investment
(5,129
)
—
(5,129
)
—
Change in fair value of contingent
consideration
1,183
125
2,230
235
Hurricane expenses (recoveries)
(1,685
)
—
(191
)
—
Foreign currency
(371
)
(30
)
(2,801
)
42
Adjusted EBITDA
$
57,354
$
80,267
$
110,549
$
135,590
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 guidance for fiscal year
2023 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
acquisition 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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230426005788/en/
Investors: Mike McLamb Chief Financial Officer MarineMax, Inc.
727-531-1700 Scott Solomon or Laura Resag Sharon Merrill
Associates, Inc. investors@marinemax.com Media: Katherine Cooper
Director of Communications MarineMax, Inc. press@marinemax.com
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