MasterCraft releases Q1 results - Trade Only Today

MasterCraft releases Q1 results

Weather-related sales dips prompted the company to right-size inventory levels.
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The Crest acquisition contributed to gross profit increases.

The Crest acquisition contributed to gross profit increases.

MasterCraft Boat Holdings Inc. reported that net sales increased $109.8 million, or 17.2 percent, in the first quarter, from $93.6 million in the first quarter of fiscal 2018.

The inclusion of Crest, acquired during the second quarter of 2019, contributed incremental net sales of $18.9 million.

A $0.6 million increase for NauticStar, driven by higher wholesale average selling prices due to a greater mix of larger products and price increases, was partially offset by lower unit sales volumes, the company said.

A $3.3 million decrease for the MasterCraft segment was primarily due to lower unit sales volumes for the MasterCraft brand as the company works to right-size dealer inventory levels after the weather-impacted summer selling season. That decrease was partially offset by a mix of higher-priced and higher-contented models.

The decrease for the MasterCraft brand was partially offset by the start of sales for the company’s new Aviara brand.

Gross profit increased $2.3 million, or 10 percent, to $25.5 million compared to $23.2 million for the prior-year period. The increase was primarily due to the inclusion of Crest, which grew gross profit by $2.6 million.

“Despite a challenging retail demand environment this past summer due principally to bad weather, the combined strength of our brands and improved retail activity in the fiscal first quarter of 2020 led to improved dealer inventory levels at the end of the quarter,” said interim CEO Fred Brightbill in a statement. “We remain on course to drive continued dealer inventory improvements through the boat show season, allowing for healthy dealer pipelines ahead of the peak summer selling season and beyond.”

Brightbill was named as interim CEO after the Oct. 31 announcement that former CEO Terry McNew was stepping down.

“As I assume the role of interim CEO, I look forward to working alongside the long-tenured, industry-veteran leadership team and seasoned and dedicated employees at MasterCraft, Aviara, NauticStar and Crest to support them in executing the strategic objectives currently underway,” Brightbill said.

The company is optimistic about the long-term prospects of both the markets it serves and its brands, despite any near-term fluctuations, said Brightbill.

“The launch of our new Aviara brand is being extremely well received by our dealer partner, MarineMax, and consumers alike, and we’ve made significant improvements in our dealer pipeline inventory through our first fiscal quarter,” said Brightbill. “As we continue to navigate the challenges ahead, including economic, trade and political uncertainty, we remain steadfast in our focus to prudently manage the company and position it for long-term success. We will use the transition to a new CEO as an opportunity to build on the company’s historical success and position it for the next stage of growth.”

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