MarineMax reports 3Q results

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MarineMax today reported lower revenue for its fiscal 2009 third quarter amid continuing weak boat sales, a tight retail lending environment, and low consumer confidence.

Also, executives said dealer failures and boat repossessions will continue, resulting in short-term dumping of product into the market for the remainder of this year.

"The recovery will take longer than typical recessions," said MarineMax chairman, president and CEO William H. McGill Jr. in a conference call this morning.

Nevertheless, he said, "We are confident that the tactical actions we are taking will position MarineMax to strategically capitalize on the opportunities as conditions improve."

Specifically, MarineMax reduced expenses by more than $17 million, compared to the third quarter of fiscal 2008; reduced inventory levels by $175 million year-over-year; and secured an amendment to its credit agreement, which allows the company to be even more aggressive in further reducing inventory levels.

"The actions we have taken have allowed us to generate over $100 million in cash flow from operations during the first nine months of fiscal 2009, which in turn has allowed us to substantially reduce our outstanding borrowings," said McGill.

The company is starting to see some signs of retail improvement, with July sales up compared to last July.

"One month does not make a trend," said chief financial officer Michael McLamb. Still, he said, "It's nice to see an up month after so many months of declines."

Revenue for the third quarter, which ended June 30, was $151.5 million, compared to $271.3 million for the comparable quarter last year. Same-store sales declined about 39 percent, compared to a 27 percent decrease in the year-ago quarter. Revenue from stores recently closed that were ineligible for inclusion in the same-store sales base was $25.2 million.

The net loss for the recent quarter was $9.2 million, or 49 cents per share, compared to a net loss of $113.3 million, or $6.15 per share, for the comparable quarter last year.

Included in the third quarter fiscal 2009 net loss was about $2 million associated with store-closing costs. Included in the third quarter fiscal 2008 loss was a non-cash charge of $122.1 million, before tax, related to deferred tax assets associated with the impairment of goodwill and intangibles.

Revenue for the nine months ending June 30 was $381.3 million, compared to $719.8 million for the year-ago period. Same-store sales declined about 44 percent, compared to a 23 percent decline in the comparable period last year.

Net loss for the nine months ending June 30 was $43.8 million, or $2.37 per share, compared to a net loss of $123.2 million, or $6.70 per share, for the comparable period last year.

The company's results for the recent nine-month period included $3.4 million in costs associated with store closings, as well as $5.9 million for incurred losses and increases in inventory reserves for brands the company no longer represents.

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— Melanie Winters


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