Marine Products releases 3Q results

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Marine Products Corp., manufacturer of Chaparral and Robalo boats, this morning announced a decline in sales for the third quarter, which ended Sept. 30.

For the quarter, Marine Products reported net sales of nearly $31.6 million, a 39.8 percent decrease compared to net sales of nearly $52.5 million in the same period last year.

The company attributed the drop to a 47.7 percent decrease in the number of boats sold, partially offset by an 11.8 percent increase in the average selling price per boat.

“Our results were once again negatively impacted by some of the same macroeconomic and industry specific factors that have plagued the pleasure boating industry for over three years,” CEO Richard A. Hubbell said in a statement.

“This quarter, retail boat sales were also affected by the credit crisis and unprecedented turmoil in the financial markets. Not only has this crisis made consumers reluctant to buy discretionary items such as pleasure boats, but the recent curtailment of consumer and business lending has made it difficult to secure loans for boat purchases,” he added.

The company, Hubbell said, does not see any signs of improvement, adding “since the environment was worse at the end of the quarter than the beginning, we continue to reduce production in order to manage dealer inventory levels.”

The company’s stock was trading at $5.65 per share this morning. Its 52-week high and low are $9.75 and $5.16 per share.

Gross profit for the quarter was $5.1 million, or 16.2 percent of net sales, compared to $11.2 million, or 21.5 percent of net sales, in the third quarter of 2007.

Net income for the third quarter was $684,000, a 78.8 percent decrease compared to $3.2 million in the prior year. Net income decreased because of lower income before income taxes and a higher effective tax rate, the company said.

Net sales for the nine months ended Sept. 30, were $152.8 million, a 17.5 percent decrease compared to the first nine months of 2007. Net income for the nine-month period decreased 29.9 percent to $8.7 million, or 24 cents diluted earnings per share compared to $12.4 million, or 32 cents diluted earnings per share in the prior year.

“Although we are in the most protracted downturn in our company’s history as a public company, we continue to be pleased with the market’s reception to our new products,” Hubbell noted.

“The success of our redesigned Sunestas and SSi Wide Techs contributed positively to our financial results this quarter. As we announced in September, we introduced Chaparral’s 400 Premiere Sport Yacht at our recent dealer conference. Our expansion into bigger boats is a natural progression given our history and engineering capabilities, and the 400 Premiere has been met with widespread acceptance.”

Click here for the complete release.

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