MarineMax, Inc. reported earnings in its fiscal third quarter ended June 30 fell 35 percent due to costs tied to the acquisition of IGY Marinas and more promotions in the marketplace. Same-store sales were up slightly. Results were ahead of company expectations.
“Our team outperformed our expectations in the third quarter, highlighted by record revenue, solid earnings and strong cash flows. Robust consumer demand and enthusiasm for boating, particularly in the premium segment, fueled new and used boat revenue and resulted in a modest increase in same-store sales in the quarter,” stated MarineMax Chief Executive Officer and President Brett McGill. “We continue to execute on our strategy to structurally enhance our margin profile through premium products, services and experiences that enable customers to enjoy the boating lifestyle. While the marine industry is seeing a return to seasonality that led to incrementally more aggressive retail pricing during the quarter, our margins remained healthy, strengthened by the more profitable business lines in our integrated marine portfolio, as well as strategic acquisitions such as IGY Marinas.
“The addition of IGY Marinas is significantly enhancing our worldwide reach while creating opportunities for synergies with our other superyacht services offerings,” McGill continued. “Capitalizing on our strong balance sheet, in the quarter we also added C&C Boat Works of Minnesota to the MarineMax family. With C&C’s significant storage capabilities, combined with our nearby existing operations, we are better able to serve the vibrant Minnesota boating community.”
Fiscal 2023 Third Quarter Results
Revenue in the fiscal 2023 third quarter increased to a record $721.8 million from $688.5 million in the comparable period last year. The 4.8 percent top-line growth was driven primarily by the acquisition of IGY Marinas, which the company acquired in October 2022, increased manufacturing revenue and stronger new and used boat revenue. Same-store sales increased slightly in the third quarter compared with a decline of 5 percent a year ago. IGY Marinas and boat manufacturing revenue are not included in the same-store sales comparison.
Gross profit increased 3.1 percent to $243.8 million from $236.5 million in the prior-year period. Gross profit margin of 33.8 percent decreased 50 basis points from 34.3 percent in the fiscal 2022 third quarter, primarily due to revenue mix.
Selling, general, and administrative expenses (SG&A) totaled $169.2 million, or 23.4 percent of revenue, in the third quarter compared with $141.2 million, or 20.5 percent of revenue, for the same period last year, primarily reflecting the addition of IGY Marinas.
Interest expense increased to $14.8 million in the third quarter from $1.0 million in the prior-year period, reflecting higher interest rates as well as the increase in long-term debt associated with the IGY Marinas acquisition and greater inventory.
Net income in the third quarter was $44.4 million, or $1.98 per diluted share, compared with net income of $70.2 million, or $3.17 per diluted share, in the same period last year.
Adjusted net income in the third quarter was $46.5 million, or $2.07 per diluted share, compared with $71.5 million, or $3.23 per diluted share, in the prior-year period. Adjusted EBITDA for the quarter ended June 30, 2023, was $83.5 million, compared with $105.5 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 narrowing its fiscal year 2023 guidance for adjusted earnings2 to a range of $5.10 to $5.50 per diluted share, compared with a prior range of $4.90 to $5.50 per diluted share. The company also is narrowing its fiscal year 2023 guidance for Adjusted EBITDA to a range of $225 million to $245 million, compared with a prior range of $220 million to $245 million.
Photo courtesy IGY Marinas
