Brunswick Corp. reported preliminary results for the fiscal second quarter that ended July 1, with revenue of approximately $1.7 billion, GAAP EPS in the range of $1.85 to $1.90 a share and Adjusted EPS in the range of $2.30 to $2.35 a share with strong free cash flow generation.
The company said the preliminary results were below initial expectations for the quarter due solely to the impacts of its recent IT security incident disclosed in June. BC noted that absent the incident, the company believes it would have met or exceeded the Adjusted EPS guidance it previously provided for the second quarter.
“The second quarter financial impact of the production and distribution disruption was felt almost entirely within our Propulsion and Engine P&A segments and, while our facilities and systems are now fully operational, because of the proximity of the disruption to the end of the quarter, there was limited opportunity to recover in the period,” said Dave Foulkes, Brunswick Corporation CEO. “As we look to the balance of the year, we see opportunity to recover some of the losses, but the lost production of high horsepower outboard engines will be difficult to compensate because we plan to be in full production for the balance of the year with limited ability to overdrive.
“For the full year, while we see some positive signals, with stronger than expected new boat retail in the recent months and continued high Mercury retail market share, the impact of the IT security incident combined with anticipated continued pressure on consumers globally, lead us to be cautious regarding second-half financial performance. These factors, coupled with our disciplined management of inventory levels across our businesses as we plan forward, direct our full-year Adjusted EPS expectations to now be approximately $9.50.”
