Marine Products Corp., the builder of Chaparral and Robalo boats, said today that first-quarter sales rose 7.7 percent and that profits climbed 36.5 percent to nearly $2 million.
The company said it earned $1.98 million, or 5 cents a diluted share, during the quarter that ended March 31, compared with $1.45 million, or 4 cents a share, a year earlier.
Net sales totaled $47.7 million, compared with $44.3 million in the quarter last year.
The company said the sales gain was attributable to an increase of 13.4 percent in the average selling price per boat and an increase in parts and accessories sales, partially offset by a 5.4 percent decrease in the number of units sold during the quarter, compared with the prior year.
The company said average selling prices and parts and accessories sales increased, compared with the prior year, because of a favorable model mix that included larger Chaparral H2O models, improved sales of large Robalo models and a significant number of the company’s 307 SSX Sportboats, which were introduced in the 2014 model year.
Gross profit for the quarter was $8.84 million, or 18.5 percent of net sales, a 24.3 percent increase from $7.1 million, or 16.1 percent of net sales, in the same period in the prior year. As a percentage of net sales, gross profit increased because of enhanced operational efficiencies and an improved model mix, compared with the first quarter of 2013.
Marine Products said operating profits for the quarter increased by 88 percent to $2,8 million compared with $1.5 million in the first quarter last year, because of higher gross profit, partially offset by higher selling, general and administrative expenses.
The company said selling, general and administrative expenses increased by 7.6 percent to $6.1 million in the first quarter, compared with $5.6 million last year. The expenses increased because of costs that vary with sales and profitability, such as incentive compensation, sales commissions and warranty expense, the company said.
"Our financial results for the first quarter reflect continued growth in the sales of our Robalo sportfishing boats and a favorable model mix, both at Robalo and several of our Chaparral product lines,” CEO Richard A. Hubbell said in a statement.
“The market has responded favorably to our Chaparral 307 SSX Sportboat, introduced during the 2014 model year, and our larger Chaparral H2O models. In addition, unit sales of our Robalo sportfishing boats increased, compared to the first quarter of 2013, particularly in some of our larger models and the newly introduced Robalo bay boat. Dealer inventories are high enough to allow our dealers to meet retail demand. We believe that prolonged winter weather during the first quarter has impacted retail sales and caused dealer inventories to be slightly higher than normal.
"We sold our first Chaparral Vortex jetboats during the quarter. We are pleased with the product, as well as our dealers' reception to it. During the first quarter we sold the Vortex 203, and will produce the larger Vortex 223 and 243 models by the third quarter. We are also gratified by strong sales of several of our new Chaparral models and the continued growth in Robalo. The most recent market share statistics indicate that Chaparral is maintaining its leading market share in the 18- to 35-foot sterndrive pleasure boat category, which is confirmation of the appeal of our products. We are concerned about the continued cold weather in many of our domestic markets and are closely monitoring retail sales in order to maintain appropriate dealer inventory levels."