MarineMax reports 2Q results - Trade Only Today

MarineMax reports 2Q results


MarineMax today reported a sharp decline in revenue and same-store sales for the second quarter, which ended March 31.

Revenue was $129.6 million for the quarter, compared with $233.3 million for the comparable quarter last year. Same-store sales declined about 41 percent, compared with a 28 percent decrease in the comparable quarter last year.

Revenue from stores recently closed that were not eligible for inclusion in the same-store sales base was $15.2 million.

Clearwater, Fla.-based MarineMax operates 74 retail locations around the country.

The net loss for the second quarter of fiscal 2009 was $20.3 million, or $1.09 per share, compared with a net loss of $3.5 million, or 19 cents per share, for the comparable quarter last year. Included in the second quarter fiscal 2009 net loss was about $900,000, or 5 cents per share, associated with store-closing costs.

This morning, MarineMax stock was trading at $4.71 per share, down from its opening of $5.43. Its 52-week high and low are $11.92 and $1.19.

MarineMax also reported a reduction in expenses and inventory this quarter, which is good news for the company, said chairman, president and CEO William McGill Jr. during a conference call this morning.

MarineMax is down about $155 million in inventory during a period in which inventory usually rises, he said.

"We made significant progress in a number of areas during the second quarter, despite the continued weak retail conditions," McGill said. "Our ongoing efforts to aggressively reduce our cost structure allowed us to realize an approximate $20 million decrease in expenses during the quarter, the largest year-over-year quarterly reduction we have reported to date."

For the six months ending March 31, revenue was $229.8 million, compared with $448.5 million for the comparable period last year. Same-store sales declined about 46 percent, compared with a 20 percent decline in the comparable period last year.

The net loss for the six months ending March 31 was $34.6 million, or $1.87 per share, compared with a net loss of $9.9 million, or 54 cents per share, for the comparable period last year.

During this morning's call, McGill noted that retail financing was more difficult this quarter and that the fallout of customers who were contracted, but didn't receive delivery, was higher. Traditionally, MarineMax sees a fallout of 15 to 20 percent, he said. It's now approaching 50 percent.

In some cases, the company is having to give up margin to make the sale. For example, a customer may want to put down 20 percent, but the lender wants 35 to 40 percent down, so MarineMax is giving up margin to complete the sale.

"We feel it's more important to move the inventory," McGill explained.

Despite a glut of repossessed boats in the marketplace, McGill said he is confident that, for the most part, MarineMax is not competing with that business. Most repossessed boats, he noted, come with few records and often require substantial work.

"Our customers want the total experience," he said.  "While we expect the industry to remain under pressure until the economy begins to improve, we are encouraged to see that our customers' passion for boating remains strong."

— Beth Rosenberg


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