Larger products sold well at the Fort Lauderdale International Boat Show for MarineMax, although the company saw strength from all segments that the marine dealership chain serves.
“This show and others that we have attended recently are further indication that the industry recovery is holding and gaining momentum,” MarineMax CEO Bill McGill told investors and analysts during a call Tuesday to discuss the company’s fourth-quarter and full-year earnings reports. “We all need to be cautious, however, until it becomes clear that meaningful gains are occurring and ultimately be reflected in our results.”
Year-over-year earnings improved “reasonably well, though we had some increases in certain expenses, such as insurance and losses associated with Hurricane Sandy claims on our property,” McGill said.
The company saw strength in the New York area during the quarter, although New Jersey was still down, CFO and vice president Mike McLamb said during the call. McLamb expected that area to rebound as the boating infrastructure continues to be repaired.
“Given that the majority of our new-boat revenue is from sterndrive and inboard powerboats, [seeing] strength in these segments will prove to be quite beneficial to us, especially when considering the additional brands we have added over the past three or four years that are concentrated in these segments,” McGill said. “As the industry recovery expands and gains momentum, the addition of these brands should help to further propel our same-store sales growth and result in greater market share growth. Having said that, we need to see a continuation of improving data in these key segments to realize the greatest benefits.”
Gross profit grew about $7 million for the quarter, or slightly more than 21 percent, McLamb said. Gross profit as a percentage of revenue increased to 26.8 percent from 24.1 percent last year.
“The increase in our margins is noteworthy because these boat sale-driven consolidated margins usually drop since boats carry the lowest margin of all of our business categories,” McLamb said.
Recoveries related to the BP Deepwater Horizon oil spill, at $11.7 million net this year, were “significant enough” to have meaningfully increased the company’s tangible net worth.
— Reagan Haynes