MasterCraft Boat Holdings today reported sales of $128.4 million, up 36.9 percent compared to the same period a year ago. Net income rose 11.4 percent to $12.8 million. The company said in a statement that the financial results include the Crest acquisition that closed on October 1, 2018.
Terry McNew, president and CEO, said the company had record levels of sales and profits.
“We continue to see strong retail and wholesale momentum in our core MasterCraft brand driven by our strong product portfolio and the underlying strength in the broader performance sport boat segment,” said McNew in the statement. “The integration of our newest brand, Crest, is ahead of plan and we are seeing the benefits of our industry-leading operational excellence through increased capacity and enhanced working capital efficiencies. Importantly, this additional capacity to support future long-term growth at Crest has come with virtually no capital expenditures.”
Its NauticStar brand sales were down 11.8 percent, or $2.9 million, to $21.7 million due to lower wholesale units driven by a slowdown in the retail demand for NauticStar’s small boats.
“Our product development strategy of pivoting NauticStar’s portfolio to higher-margin, larger product continues to be a primary focus, and is validated by the current softness in retail demand being experienced across the mid-line, smaller product category,” said McNew. “We will more fully realize the financial benefits from this strategy as these larger products become a larger percentage of our mix over the next several years.”
McNew said that retail activity “slowly gained momentum” through the third quarter. “We remain comfortable with inventory levels across all our brands, despite challenging domestic weather conditions and their impact on retail demand coming out of the boat shows,” he added. “We believe the upcoming retail season will be solid, driven by the resilience of the U.S. economy, the strength of our product portfolio and premier dealer partners.”
The company reaffirmed its previous guidance of low 40 percent net sales growth over fiscal 2018, adjusted EBITDA margins in the mid-to-high 16 percent range and adjusted earnings per share growth in the low 30 percent range.