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Brunswick reports 1Q results

Net sales dropped 3 percent in the first quarter at Brunswick Corp., from $995.3 million in 2013 to $969.2 million this year.

Sales were flat in the marine engine parts and accessories business, and engine sales declined. The boat segment saw a 2 percent decline in sales, and wholesale unit shipments decreased, compared with 2013, although that decrease was partially offset by higher average selling prices.

“Our first-quarter revenues declined by 3 percent, primarily due to harsh weather conditions that have adversely affected sales activity in our marine and bowling and billiards segments,” Brunswick chairman and CEO Dustan E. McCoy said in a statement. “Our top line reflected growth in fitness equipment and outboard boats, which was more than offset by declines in marine engines, fiberglass sterndrive/inboard boats and in our bowling and billiards businesses.”

Brunswick reported first-quarter net earnings of $57 million, or 60 cents a diluted share, compared with $49.8 million, or 53 cents a share, in the quarter last year.

The marine engine segment (which includes marine parts and accessories) reported net sales of $505.1 million in the quarter, which ended March 29, down 3 percent from $521.8 million in 2013. International sales, which represented 36 percent of total segment sales in the quarter, were down 4 percent, compared with the prior year.

For the quarter, the marine engine segment reported operating earnings of $61.7 million. This compares with operating earnings of $71.5 million in the first quarter of 2013.

Sales were flat in the segment’s parts and accessories businesses, and overall engine sales declined.

The boat segment reported net sales of $282.8 million for the quarter, a decrease of 2 percent from $289.7 million in the first quarter of 2013. International sales, which represented 35 percent of total segment sales in the quarter, increased by 1 percent during the period.

The boat segment reported operating earnings of $8.4 million for the quarter. This compares with $2.4 million in the first quarter of 2013, including restructuring charges of $4.9 million.

"First-quarter U.S. marine retail activity was below our annual expectations as a result of harsh weather conditions in important boating markets,” McCoy said. “The abnormal weather conditions and the continuing overhang these conditions caused are masking the underlying consumer demand for our boat and engine products. However, at this very early point in the marine season, our operating plans for the full-year remain fairly consistent with the planning assumptions we communicated at the outset of the year.”

The company is reaffirming previously stated 2014 diluted earnings per common share, as adjusted, in an estimated range of $2.40 to $2.55.

“Our 2014 guidance reflects 5 percent to 6 percent sales growth,” McCoy said. “Our 2014 targets and plans are based on global economic conditions that are generally comparable to 2013, with weak market demand continuing in certain regions in Europe. As a result, we expect to benefit from the continuation of the modest recovery in the global marine market, with solid growth in outboard boat and engine products, as well as in the global parts and accessories marketplace. In the fiberglass sterndrive/inboard boat category, which also affects sterndrive/inboard engine production, we are currently planning for a modestly declining market, with stability in large boats.”

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