MarineMax Reports Second Quarter Fiscal 2020 Results

4/23/20

~ Revenue Grew to $308.5 Million ~

~ Same-Store Sales Increased Over 1% ~

~ Gross Margins Expanded 110 Basis Points Driven By Higher Margin Businesses ~

~ Reports EPS of $0.23 ~

~ Aggressive Actions Result in Cash Generation and Increased Financial Flexibility ~

CLEARWATER, Fla.--(BUSINESS WIRE)-- MarineMax, Inc. (NYSE: HZO), the nation’s largest recreational boat and yacht retailer, today announced results for its fiscal second quarter ended March 31, 2020.

Revenue grew almost 2% to $308.5 million for the quarter ended March 31, 2020 from $303.6 million for the comparable quarter last year. Same-store sales for the quarter increased over 1% on top of a 12% during the same period last year. Income before taxes was $6.7 million for the quarter ended March 31, 2020, compared to $7.2 million for the same quarter last year. Net income was $5.1 million, or $0.23 per diluted share, for the quarter ended March 31, 2020 compared to net income of $5.3 million, or $0.23 per diluted share, for the comparable quarter last year.

The Company’s results for the fiscal second quarter 2020 were partially impacted by the historic global pandemic. Despite the growing impact of COVID-19 during March, the Company generated positive same-store sales in the quarter as it utilized its digital platform and promotional activity to improve traffic and sales.

For the six-months ended March 31, 2020, revenue increased over 12% to $612.6 million compared with $545.5 million for the same period last year. Same-store sales grew approximately 12% in the first half of fiscal year 2020 on top of 7% growth during the same period last year. Income before taxes rose 39% to $19.0 million for the six-months ended March 31, 2020 from $13.7 million for the same period last year. Net income for the six months ended March 31, 2020 grew 38% to $14.1 million, with earnings per diluted share rising 46% to $0.64 per diluted share, from net income of $10.2 million, or $0.44 per diluted share, for the comparable period last year.

W. Brett McGill, Chief Executive Officer and President, stated, “While we are keenly focused on managing our business to optimize cash flow, our highest priority remains with the health and safety of our employees, customers and the communities in which we operate. With most waterways open, we are committed to offering essential services to our boating communities and providing resources to get our customers and their families out on the water together, safely. Our strategy of investing in high margin businesses, best in class technology and focusing our team’s efforts on premium products and brands has served us well. Our business is further benefiting from our fully integrated CRM system and data analytics, creating a seamless experience for our customers.”

Mr. McGill continued, “With one of the strongest and lowest leveraged balance sheets in the industry, we believe we have sufficient financial flexibility and liquidity to navigate this crisis. As our cycle tested management team has demonstrated through past challenged economic times, our business model is resilient and resonates with customers. Furthermore, our balance sheet is even stronger today. Given our significant unencumbered real estate holdings, flexible leases, unleveraged inventory, cost reductions and inventory management, we are well positioned to overcome and potentially capitalize during the current situation. As COVID-19 recedes, we are confident that now more than ever, our customers will be spending more time out on the water, close to home.”

MarineMax ended the second quarter of fiscal 2020 with $90 million of liquidity on its balance sheet, comprised of $64 million of cash and cash equivalents along with $26 million available under its floorplan financing facility. The Company’s $440 million floorplan facility had $363 million outstanding at March 31, 2020, and does not mature until October 2022. Additionally, there are no operating covenants in its floorplan facility, the Company’s leases are shorter term in nature, enhancing its flexibility and retail financing remains stable. The Company owns approximately half of its locations, which are all debt free. The Company ended March 31, 2020 with $506.9 million of inventory and with units down sequentially, as it continues to proactively work with its manufacturing partners to further align future orders as may be required.

As the COVID-19 pandemic is complex and evolving rapidly, the Company will continue to monitor ongoing developments and respond accordingly. The Company continues to comply with orders of local and state governments in all jurisdictions in which it operates.

Fiscal 2020 Guidance

As previously disclosed, the Company withdrew its prior 2020 guidance given the continued significant uncertainties related to COVID-19.

About MarineMax

Headquartered in Clearwater, Florida, MarineMax is the nation’s largest recreational boat and yacht retailer. Focused on premium brands, such as Sea Ray, Boston Whaler, Hatteras, Azimut Yachts, Benetti, Ocean Alexander, Galeon, Grady-White, Harris, Bennington, Crest, MasterCraft, MJM Yachts, NauticStar, Scout, Sailfish, Scarab Jet Boats, Tige, Yamaha Jet Boats, Aquila, Aviara, and Nautique. MarineMax sells new and used recreational boats and related marine products and services, as well as provides yacht brokerage and charter services. MarineMax also owns Fraser Yachts Group, a leading superyacht brokerage and luxury yacht services company with operations in multiple countries. MarineMax currently has 59 retail locations in Alabama, Connecticut, Florida, Georgia, Maryland, Massachusetts, Minnesota, Missouri, New Jersey, New York, North Carolina, Ohio, Oklahoma, Rhode Island, South Carolina and Texas, and operates MarineMax Vacations in Tortola, British Virgin Islands. MarineMax is a New York Stock Exchange-listed company. For more information, please visit 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 the Company’s anticipated financial results for the second quarter ended March 31, 2020; the Company’s strategy of investing in high margin businesses, best in class technology and focusing the team’s efforts on premium products and brands; the Company having sufficient financial flexibility and liquidity to navigate the COVID-19 crisis; the Company’s positioning to potentially capitalize during the current situation; the Company’s confidence that as COVID-19 recedes, customers will now more than ever, spend time on the water; and the Company continuing to monitor ongoing COVID-19 pandemic developments and respond accordingly. 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 impacts (direct and indirect) of COVID-19 on the Company’s business, the Company’s employees, the Company’s manufacturing partners, and the overall economy, general economic conditions, as well as those within our industry, the level of consumer spending, the Company’s ability to integrate acquisitions into existing operations, the continued recovery of the industry, and numerous other factors identified in the Company’s Form 10-K for the fiscal year ended September 30, 2019 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.

MarineMax, Inc. and Subsidiaries
Condensed Consolidated Statements of Operations
(Amounts in thousands, except share and per share data)
(Unaudited)

 

Three Months Ended
March 31,

 

Six Months Ended
March 31,

 

2020

 

2019

 

2020

 

2019

 

 

 

 

 

 

 

 

Revenue

$ 308,475

 

$ 303,586

 

$ 612,647

 

$ 545,523

Cost of sales

229,699

 

229,384

 

453,853

 

407,843

Gross profit

78,776

 

74,202

 

158,794

 

137,680

 

 

 

 

 

 

 

 

Selling, general, and administrative expenses

69,060

 

63,976

 

133,446

 

118,468

Income from operations

9,716

 

10,226

 

25,348

 

19,212

 

 

 

 

 

 

 

 

Interest expense

3,013

 

3,033

 

6,357

 

5,549

Income before income tax provision

6,703

 

7,193

 

18,991

 

13,663

 

 

 

 

 

 

 

 

Income tax provision

1,638

 

1,890

 

4,867

 

3,450

Net income

$ 5,065

 

$ 5,303

 

$ 14,124

 

$ 10,213

 

 

 

 

 

 

 

 

Basic net income per common share

$ 0.24

 

$ 0.23

 

$ 0.66

 

$ 0.45

 

 

 

 

 

 

 

 

Diluted net income per common share

$ 0.23

 

$ 0.23

 

$ 0.64

 

$ 0.44

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

21,520,215

 

22,836,571

 

21,486,995

 

22,807,756

Diluted

21,960,285

 

23,417,688

 

21,925,105

 

23,408,873

MarineMax, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Amounts in thousands)
(Unaudited)

 

March 31,
2020

 

March 31,
2019

ASSETS

CURRENT ASSETS:

 

 

 

Cash and cash equivalents

$ 64,406

 

$ 63,598

Accounts receivable, net

35,814

 

45,505

Inventories, net

506,887

 

454,557

Prepaid expenses and other current assets

9,369

 

8,839

Total current assets

616,476

 

572,499

 

 

 

 

Property and equipment, net

143,168

 

140,883

Operating lease right-of-use assets, net

40,566

 

--

Goodwill and other intangible assets, net

65,139

 

27,485

Other long-term assets

7,755

 

6,391

Deferred tax assets, net

--

 

1,767

Total assets

$ 873,104

 

$ 749,025

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

 

 

 

Accounts payable

$ 15,259

 

$ 11,626

Customer deposits

26,794

 

33,330

Accrued expenses

34,634

 

37,098

Current operating lease liabilities

6,850

 

--

Short-term borrowings

362,898

 

297,530

Total current liabilities

446,435

 

379,584

 

 

 

 

Noncurrent operating lease liabilities

35,639

 

--

Deferred tax liabilities, net

2,821

 

--

Other long-term liabilities

1,132

 

952

Total liabilities

486,027

 

380,536

 

 

 

 

STOCKHOLDERS' EQUITY:

 

 

 

Preferred stock

--

 

--

Common stock

28

 

27

Additional paid-in capital

273,809

 

267,264

Accumulated other comprehensive loss

(513)

 

--

Retained earnings

217,189

 

176,683

Treasury stock

(103,436)

 

(75,485)

Total stockholders’ equity

387,077

 

368,489

Total liabilities and stockholders’ equity

$ 873,104

 

$ 749,025

 

Michael H. McLamb
Chief Financial Officer
Abbey Heimensen
Public Relations
MarineMax, Inc.
727.531.1700

Brad Cohen
ICR, LLC.
203.682.8211
Brad.Cohen@icrinc.com
Dawn Francfort
ICR, LLC
646-677-1859
Dawn.Francfort@icrinc.com

Source: MarineMax, Inc.

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