Marine Products Corp. reports 1Q resultsPosted on
Marine Products Corp., the builder of Chaparral sterndrive and inboard boats and Robalo outboard sportfishing boats, saw a 17 percent increase in net sales for the first quarter because of a 12.3 percent increase in the number of boats sold and a 2.9 percent increase in the average price per boat sold.
Unit sales increased because of higher sales of larger Chaparral boats and value-priced Robalo sportfishing boats, the company said, and the average selling price per boat increased during the quarter that ended March 31 because of higher sales of several larger models, particularly the Chaparral 257 and 277 SSX.
Gross profit decreased as a percentage of net sales because of increased employment costs and the lower margins generated from more value-priced boat sales than in the quarter the year before.
Operating profits for the quarter also decreased, dropping 28.3 percent, to $1.47 million, compared with $2.05 million in the first quarter last year.
The company chalked the dip up to higher selling, general and administrative expenses. Those expenses increased because of costs that vary with sales, such as warranty expense and sales commissions. As a percentage of net sales, these expenses decreased slightly, from 13.1 percent in the first quarter of 2012 to 12.7 percent in the first quarter this year.
We are in the peak of the 2013 retail selling season, and based on activity during the 2013 winter boat shows and recent general macroeconomic indicators we are moderately optimistic regarding our dealer and retail sales opportunities, CEO Richard Hubbell said in a statement.
Our value-priced Chaparral and Robalo models continue to appeal to our dealers and retail customers. During the first quarter of 2013, however, the majority of our increase in unit sales, compared to the prior year, was due to improvements in unit sales of the larger models. Sales of our value-priced Robalo sportfishing boats increased significantly, as well. As our dealers and retail customers continue to recognize the attractiveness of our products, we are pleased to report continued strong market share.
Preliminary numbers show that Chaparrals share of the 18- to 35-foot fiberglass sterndrive market was 11.6 percent, maintaining its position as the third-largest manufacturer in this category, Hubbell said.
Net sales were $44.28 million, compared with $37.85 million in the quarter last year. Gross profits for the quarter were $7.1 million, or 16.1 percent of net sales, compared with $7 million, or 18.5 percent of net sales, in the prior year.