ATLANTA, April 25, 2018 /PRNewswire/ -- Marine
Products Corporation (NYSE: MPX) announced its unaudited results
for the quarter ended March 31,
2018. Marine Products is a leading manufacturer of fiberglass
boats under two brand names: Chaparral and Robalo. Chaparral's
sterndrive models include H2O Sport and Ski & Fish Boats, SSi
and SSX Sportboats, Sunesta Sportdecks and Signature
Cruisers. In addition, Chaparral manufactures SunCoast
Sportdeck outboards, Vortex Jet Boats and the Surf Series of
Chaparral SSi and SSX Sportboats, Sunesta Sportdecks and H2O.
Robalo builds outboard sport fishing boats which include center
console, dual console, walkaround cabin and Cayman bay boat
models.
For the quarter ended March 31,
2018, Marine Products generated net sales of $77,536,000, a 9.1 percent increase, compared to
$71,040,000 in the same period of the
prior year. The increase in net sales was due to a 9.6
percent increase in the average selling price per boat, as well as
an increase in parts and accessories sales. Average selling
prices increased during the quarter due to a model mix which
included larger boats.
Gross profit for the quarter was $17,651,000, an 18.4 percent increase compared to
gross profit of $14,906,000 in the
same period of the prior year. Gross profit for the first
quarter increased compared to the prior year due to higher net
sales and improved profitability. Gross margin was 22.8
percent in the first quarter of 2018, compared to 21.0 percent in
2017. Gross margin improved during the first quarter of 2018
as compared to the prior year due to the increase in average
selling prices, a favorable model mix and improved manufacturing
efficiencies.
Operating profit for the quarter was $9,033,000, an increase of 31.0 percent, compared
to $6,898,000 in the first quarter of
last year. Selling, general and administrative expenses were
$8,618,000 in the first quarter of
2018, an increase of 7.6 percent compared to the first quarter of
2017. Selling, general and administrative expenses increased
due to higher incentive compensation consistent with improved
operating results. Selling, general and administrative
expenses as a percentage of net sales declined slightly during the
first quarter of 2018 as compared to the first quarter of the prior
year.
Net income for the first quarter of 2018 was $7,609,000, an increase of $2,348,000 or 44.6 percent compared to the first
quarter of 2017. Diluted earnings per share of $0.22 increased by $0.07 or 46.7 percent compared to the first
quarter of 2017. Marine Products Corporation's effective tax
rate during the first quarter was 16.1 percent, a significant
decrease compared to 24.3 percent in the first quarter of
2017. The effective tax rate declined in the first quarter of
2018 compared to the prior year primarily due to the Tax Cuts and
Jobs Act enacted during the fourth quarter of 2017. The
effective rate in the first quarters of 2018 and 2017 reflects an
excess tax benefit related to the restricted shares that vested
during these periods. We estimate that Marine Products'
effective tax rate for the next three quarters will be
approximately 22 percent, and that the effective tax rate for the
12 months ending December 31, 2018
will be in the low 20 percent range. The lower effective tax
rate for the first quarter of 2018 increased diluted earnings per
share by $0.02.
Richard A. Hubbell, Marine
Products' President and Chief Executive Officer stated, "Our first
quarter 2018 financial results were driven by sales of several
popular 2018 models, including the three new Chaparral SSX models
and several of the larger Robalo Explorer models. Our
dealer inventories have increased slightly, and backlog is higher
than at this time in 2017, reflecting high levels of dealer demand
during this retail selling season. In addition, we are
pleased to report continued strong market positions in both our
sterndrive and outboard sport fishing boat product lines. For
the 12-month period ending in December
2017, Chaparral maintained its multi-year position as the
largest sterndrive manufacturer in its size category, with a market
share of 16.7 percent. In addition, Robalo market position
increased to become the third largest brand in its category, with a
market share of 5.3 percent.
During the quarter, we issued the largest regular quarterly cash
dividend in Marine Products' history and continued share
repurchases under our open market share repurchase program.
In spite of these uses of cash, we finished the first quarter with
$21.4 million in cash and marketable
securities, an increase of $3.4
million compared with the first quarter of last year,"
concluded Hubbell.
Marine Products Corporation will hold a conference call today,
April 25, 2018 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 www.marineproductscorp.com. The live
conference call can also be accessed by calling (866) 529-8792 or
(323) 701-1132 for international callers and using the conference
ID #8581160. A replay will be available in the investor
relations section of Marine Products' website beginning
approximately two hours after the call.
Marine Products Corporation (NYSE: MPX) designs, manufactures
and distributes premium-branded Chaparral sterndrive, jet drive and
outboard pleasure boats, and Robalo outboard sport fishing
boats. The Company continues to diversify its product lines
through product innovation. With 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 to generate superior financial
performance to build long-term shareholder value. For more
information on Marine Products Corporation visit our website at
www.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, our
estimate that Marine Products' effective tax rate for the next
three quarters will be approximately 22 percent, and that the
effective tax rate for the 12 months ending December 31, 2018 will be in the low 20 percent
range and our belief that we are prepared to capitalize on
opportunities to increase our market share and to generate superior
financial performance to create long-term shareholder value.
These statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or
achievements of Marine Products Corporation to be materially
different from any future results, performance or achievements
expressed or implied in such forward-looking statements.
These risks include possible decreases in the level of consumer
confidence and available funds impacting discretionary spending,
increased interest rates and fuel prices, weather conditions,
changes in consumer preferences, deterioration in the quality of
Marine Products' network of independent boat dealers or
availability of financing of their inventory, continued weakness in
the sterndrive recreational boat market, and competition from other
boat manufacturers and dealers. 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' Form 10-K, filed with
the Securities and Exchange Commission for the year ending
December 31, 2017.
For information
contact:
|
|
BEN M.
PALMER
|
JIM
LANDERS
|
Chief Financial
Officer
|
Vice President,
Corporate Finance
|
(404)
321-7910
|
(404)
321-2162
|
irdept@marineproductscorp.com
|
jlanders@marineproductscorp.com
|
MARINE PRODUCTS
CORPORATION AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
CONSOLIDATED
STATEMENTS OF OPERATIONS (In thousands except
per share data)
|
|
Periods ended March
31, (Unaudited)
|
|
First
Quarter
|
|
|
|
|
|
2018
|
|
|
2017
|
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% BETTER
(WORSE)
|
|
Net
Sales
|
$
|
77,536
|
|
$
|
71,040
|
|
9.1
|
%
|
Cost of Goods
Sold
|
|
59,885
|
|
|
56,134
|
|
(6.7)
|
|
Gross
Profit
|
|
17,651
|
|
|
14,906
|
|
18.4
|
|
Selling, General and
Administrative Expenses
|
|
8,618
|
|
|
8,008
|
|
(7.6)
|
|
Operating
Profit
|
|
9,033
|
|
|
6,898
|
|
31.0
|
|
Interest
Income
|
|
33
|
|
|
51
|
|
(35.3)
|
|
Income Before Income
Taxes
|
|
9,066
|
|
|
6,949
|
|
30.5
|
|
Income Tax
Provision
|
|
1,457
|
|
|
1,688
|
|
13.7
|
|
Net
Income
|
$
|
7,609
|
|
$
|
5,261
|
|
44.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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EARNINGS PER
SHARE
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.22
|
|
$
|
0.15
|
|
46.7
|
%
|
Diluted
|
$
|
0.22
|
|
$
|
0.15
|
|
46.7
|
%
|
|
|
|
|
|
|
|
|
|
AVERAGE SHARES
OUTSTANDING
|
|
|
|
|
|
|
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Basic
|
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34,607
|
|
|
34,931
|
|
|
|
Diluted
|
|
34,607
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|
|
34,931
|
|
|
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MARINE PRODUCTS
CORPORATION AND SUBSIDIARIES
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|
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|
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CONSOLIDATED
BALANCE SHEETS
|
|
|
|
|
|
At March 31,
(Unaudited)
|
|
(in
thousands)
|
|
|
2018
|
|
|
2017
|
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
9,929
|
|
$
|
6,827
|
Marketable
securities
|
|
3,277
|
|
|
3,108
|
Accounts receivable,
net
|
|
7,812
|
|
|
8,516
|
Inventories
|
|
44,040
|
|
|
38,568
|
Income taxes
receivable
|
|
1,120
|
|
|
952
|
Prepaid expenses and
other current assets
|
|
1,312
|
|
|
1,134
|
Total current
assets
|
|
67,490
|
|
|
59,105
|
Property, plant and
equipment, net
|
|
14,110
|
|
|
13,293
|
Goodwill
|
|
3,308
|
|
|
3,308
|
Other intangibles,
net
|
|
465
|
|
|
465
|
Marketable
securities
|
|
8,235
|
|
|
8,066
|
Deferred income
taxes
|
|
3,505
|
|
|
4,981
|
Other
assets
|
|
9,680
|
|
|
8,877
|
Total
assets
|
$
|
106,793
|
|
$
|
98,095
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Accounts
payable
|
$
|
12,998
|
|
$
|
10,308
|
Accrued expenses and
other liabilities
|
|
15,561
|
|
|
14,471
|
Total current
liabilities
|
|
28,559
|
|
|
24,779
|
Long-term pension
liabilities
|
|
6,616
|
|
|
5,662
|
Other long-term
liabilities
|
|
263
|
|
|
62
|
Total
liabilities
|
|
35,438
|
|
|
30,503
|
Common
stock
|
|
3,457
|
|
|
3,496
|
Capital in excess of
par value
|
|
-
|
|
|
-
|
Retained
earnings
|
|
69,852
|
|
|
66,241
|
Accumulated other
comprehensive loss
|
|
(1,954)
|
|
|
(2,145)
|
Total
stockholders' equity
|
|
71,355
|
|
|
67,592
|
Total
liabilities and stockholders' equity
|
$
|
106,793
|
|
$
|
98,095
|
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SOURCE Marine Products Corporation