MarineMax reports 3Q results

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MarineMax today reported a decline in revenue for its third fiscal quarter, but the retailer swung from a net loss a year earlier to a profit in this year’s quarter.

Revenue was $115.4 million for the quarter that ended June 30, compared with $151.5 million for the comparable quarter last year. Same-store sales declined approximately 17 percent, compared with a 39 percent decline in the quarter last year.

Revenue from stores recently closed that were not eligible for inclusion in the same-store sales base was $12.3 million.

Net income for the third quarter of fiscal 2010 was $512,000, or 2 cents a diluted share, compared with a net loss of $9.2 million, or 49 cents a share, for the comparable quarter last year.

Included in third-quarter fiscal 2010 net income was approximately $1 million, or 4 cents a diluted share, related to loan costs written off associated with the company’s recently retired financing facility. Included in the third-quarter fiscal 2009 net loss was approximately $2 million, or 11 cents a share, associated with store-closing costs.

Inventory declined $158.4 million, or 47 percent, to $181.4 million, compared with $339.8 million on June 30, 2009.

Revenue was $325.9 million for the nine months that ended June 30, compared with $381.3 million for the comparable period last year. Same-store sales declined approximately 5 percent, compared with a 44 percent decline in the comparable period last year.

Net income for the nine-month period was $4.3 million, or 19 cents a diluted share, compared with a net loss of $43.8 million, or $2.37 a share, for the comparable period last year.

During the third quarter, MarineMax operated with 56 stores, nine fewer than it operated on June 30, 2009. MarineMax closed 26 stores in fiscal 2009 as a key component of its effort to better align fixed costs with the decline in business it has seen because of the weak economy.

“We have demonstrated this quarter that we can achieve profitability from lower levels of revenue than we ever have in the past. We attribute this improvement to the substantial progress we have made in our key initiatives. These include lowering our inventories to better align supply and demand, resulting in higher boat margins, as well as growing our higher-margin service businesses and reducing our cost structure over the past 18 months,” MarineMax chairman, president and CEO William McGill Jr. said in a statement.

“These efforts allowed us to generate a slight profit in the quarter despite the ongoing economic pressure on our industry and the impact of the BP oil spill in the Gulf of Mexico on customers’ purchasing decisions,” he added.

McGill also addressed the Clearwater, Fla.-based company’s new financing facility, which has more favorable terms.

“As a result of this new facility and the structural changes we have made to our business, we are now able to operate our business with more financial flexibility than before and resume a strategy focused on growth,” he said.

On a conference call with analysts this morning, McGill noted that industry sources say about 1,400 marine dealers have gone out of business and that more dealer failures are expected this winter.

This, he said, provides an opportunity for MarineMax and leaves it “well positioned to benefit as pent-up demand continues to grow.”

However, additional dealer failures could also lead to more lower-priced repos on the market, which could create a challenge.

Boaters are on the water and participation is up in MarineMax’s customer events. Customers are talking about their next boat, even if they are waiting to buy, McGill said.

He predicted that if the political landscape changes after November’s mid-term elections, consumers could become more confident in the economy and begin to visit showrooms.

At midday, MarineMax stock was trading at $7.31 a share, down from an opening of $7.56 a share. It closed Wednesday at $7.46 a share.

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