MasterCraft Boat Holdings, Inc. reported a strong recovery in earnings in the fiscal fourth quarter ended June 30 as sales surged 46 percent with a boost from new product introductions, increased unit volumes, and decreased dealer incentives. Earnings for the year were down, with sales retreating 12 percent.

Fourth Quarter Overview

  • Net sales were $79.5 million, up $25.2 million, or 46.4 percent, from the comparable prior-year period.
  • Income from continuing operations was $5.5 million, or $0.33 per diluted share.
  • Adjusted net income, a non-GAAP measure, was $6.6 million, or $0.40 per diluted share.
  • Adjusted EBITDA, a non-GAAP measure, was $9.5 million, up $8.0 million from the comparable prior-year period.
  • Share repurchases of $4.5 million during the quarter.

 Full Year Overview

  • Net sales were $284.2 million, down $38.1 million, or 11.8 percent, from the prior-year period.
  • Planned decrease in production contributed to approximately 30 percent lower dealer inventory levels compared to the prior year.
  • Income from continuing operations was $10.7 million, or $0.65 per diluted share.
  • Adjusted Net Income, a non-GAAP measure, was $15.1 million, or $0.92 per diluted share.
  • Adjusted EBITDA, a non-GAAP measure, was $24.4 million, down $15.8 million from the prior year.
  • Net cash provided by operating activities was $38.2 million.
  • Generated $29.0 million in free cash flow and ended the year with cash and investments of $79.4 million, with $100 million of availability on the revolving credit facility and no outstanding debt.

Brad Nelson, chief executive officer, commented, “MasterCraft executed well in fiscal 2025, successfully navigating a challenging economic and industry backdrop. In the face of low cycle volumes, we further strengthened dealer health, advanced our new product initiatives, and generated significant free cash flow. This enabled us to return nearly $10 million of capital to shareholders, underscoring our disciplined and value-enhancing approach to capital allocation.”

Nelson continued, “Our strong financial foundation provides us with the flexibility to pursue our core strategic initiatives, including investments in innovation and dealer health. As we manage through a dynamic environment, our leading brand portfolio and cash flow generation position us well to invest for the future and maintain the flexibility to return capital to shareholders.”

Fourth Quarter Results
For the fourth quarter of fiscal 2025, MasterCraft Boat Holdings, Inc. reported consolidated net sales of $79.5 million, up $25.2 million from the fourth quarter of fiscal 2024. The increase in net sales was primarily due to a favorable model mix resulting from new product introductions, increased unit volumes, decreased dealer incentives, and favorable option sales.

Gross margin percentage increased 740 basis points during the fourth quarter of fiscal 2025, compared to the prior-year period. Higher margins were primarily the result of increased net sales, as discussed above.

Operating expenses increased by $3.3 million for the fourth quarter of fiscal 2025, compared to the prior-year period, primarily due to higher variable compensation costs, increased sales and marketing expenses, and higher administrative costs.

Income from continuing operations was $5.5 million for the fourth quarter of fiscal 2025, compared to $0.3 million in the prior-year period. Diluted income from continuing operations per share was $0.33, compared to $0.02 for the fourth quarter of fiscal 2024.

Adjusted net income was $6.6 million for the fourth quarter of fiscal 2025, or $0.40 per diluted share, compared to $0.6 million, or $0.04 per diluted share, in the prior-year period.

Adjusted EBITDA was $9.5 million for the fourth quarter of fiscal 2025, compared to $1.6 million in the prior-year period. Adjusted EBITDA margin was 12.0 percent for the fourth quarter, up from 2.9 percent for the prior-year period.

Fiscal 2025 Results
For fiscal 2025, MasterCraft Boat Holdings, Inc. reported consolidated net sales of $284.2 million, down $38.1 million from fiscal 2024. The decrease in net sales was primarily due to planned lower unit volumes to align dealer inventories with retail demand, as well as changes in price. This was partially offset by a favorable model mix related to new product introductions, favorable option sales and decreased dealer incentives.

Gross margin percentage declined 220 basis points during fiscal 2025, compared to the prior year. Lower margins resulted from lower cost absorption due to decreased production volume, material and overhead inflation, and changes in sales prices.

Operating expenses increased by $1.5 million for fiscal 2025, compared to the prior year, primarily due to higher variable compensation costs.

Income from continuing operations was $10.7 million for fiscal 2025, compared to $23.2 million in the prior year. Diluted income from continuing operations per share was $0.65, compared to $1.36 for fiscal 2024.

Adjusted net income was $15.1 million for fiscal 2025, or $0.92 per diluted share, compared to $28.9 million, or $1.69 per diluted share, in the prior year.

Adjusted EBITDA was $24.4 million for fiscal 2025, compared to $40.2 million in the prior year. Adjusted EBITDA margin was 8.6 percent for fiscal 2025, down from 12.5 percent for the prior year.

Outlook
Concluded Nelson, “Our ongoing destocking progress, product innovation, and expanded distribution network position us well for fiscal 2026 and beyond. We have detailed plans in place for a range of potential retail demand scenarios and will continue to apply the cost discipline and tight working capital management that served us well in 2025. Based on our operating model and execution, we expect to generate positive free cash flow again in fiscal 2026. Regardless of the cycle, our focus will remain on maintaining a healthy dealer network, sustained innovation, and leveraging our competitive advantages to capitalize on the next market upswing.”

The company’s outlook is as follows:

  • For full year fiscal 2026, MasterCraft expects consolidated net sales to be between $295 million and $310 million, with adjusted EBITDA between $29 million and $34 million, and adjusted earnings per share between $1.15 and $1.40. Capital expenditures are expected to be approximately $9 million for the year.
  • For fiscal first quarter 2026, consolidated net sales are expected to be approximately $67 million, with adjusted EBITDA of approximately $4 million and adjusted earnings per share of $0.16.

Image courtesy MasterCraft