A resurgent Grand Banks Yachts Ltd. reported a profit of $1.47 million for the year that ended June 30, reversing a net loss of more than $3.5 million the year before.
The Singapore-based company reported a 49.7 percent increase in revenue and said the profit was its highest in eight years. The boatbuilder attributed the turnaround to measures it started to put into place in 2014 after it bought Palm Beach Yachts.
“The turnaround in the financials is mainly the result of two things,” said David Northrop, of Holland, Mich., Grand Banks vice president of sales and marketing and its director of North American and Latin American operations. “One is obviously the addition of Palm Beach Yachts, which is a very fast-selling product line for us right now.
“It’s that, coupled with our new direct-distribution approach, which has had a major 9 percent impact on our margins. In this business a 1 or 2 percent impact is big.”
Northrop said the comparison between the 2015 and 2016 fiscal year financials is an “apple-to-apple” comparison because it is the first two full years that the company has owned both the Grand Banks and Palm Beach yacht brands.
The dramatically improved sales volume, margins and net profits also reflect the integration of the Grand Banks and Palm Beach brands, which took time to accomplish, he said.
Palm Beach, based in Australia, has tripled its production since Grand Banks acquired it, Northrop said, but 60 percent of its yachts are now built at Grand Banks’ Malaysia plant, the rest in Australia. Northrop said an exchange of personnel, technology and information between the brands has benefited both and improved the bottom line.
Grand Banks said in an Aug. 29 statement that it also has streamlined operational efficiencies, strengthened its marketing and improved manufacturing processes.
“We have set in motion a corporate transformation, starting with the integration of both our brands,” Grand Banks CEO Mark Richards said in the statement. “The group is now in a stronger position and we look forward to the launch of our new yacht models.”
Northrop said Grand Banks will debut a Palm Beach 42 and an East Bay 44 at this fall’s boat shows; a Grand Banks 60 in March of 2017; a Grand Banks 52 in the fall of 2017, and an East Bay 52 in 2018. It also expects to launch at least one more Palm Beach model at the fall 2017 shows, “but we’re not ready to disclose yet what that will be,” he said.
The Palm Beach 65, though not new to Australia, will be seen for the first time in the United States at the 2016 Newport and Fort Lauderdale shows, Northrop said.
Richards described the Grand Banks-Palm Beach order book as “healthy,” with more than $25 million in new yacht orders as of June 30. A month earlier, it was at a seven-year high of almost $29.5 million. A total of 53.7 percent of the June orders by dollar volume originated in the United States and 46.3 percent in Australia, the company said.
Grand Banks sells new and brokerage yachts through company-owned sales offices in Fort Lauderdale and the Rowayton section of Norwalk, Conn. Northrop said Grand Banks is gearing up to spur brokerage sales with a new website, GBmatch.com, which will work like a dating website, ”discreetly” matching prospective Grand Banks buyers and sellers at a private online venue.
Two thousand dealmakers registered to use the site during a 30-day period this summer. It was scheduled to become active in mid- to late September, with Grand Banks brokers assisting as requested in the matchmaking.
“There’s a lot of product that’s going to be around through GBmatch that has not currently been available in the marketplace,” Northrop said.