Marine Products Corp. said it is suspending manufacturing of its Chaparral, Robalo and Vortex brands. The company made the announcement Wednesday after initially continuing operations early in the pandemic.
“Production is wrapping up at this point, but we’re still shipping orders,” marketing director Ryan Swaims told Trade Only Today. “It’s better not to take the risk.”
Essential administrative and management functions will continue without interruption, and the company's corporate headquarters in Atlanta remains open, the company said.
Marine Products Corp. does not anticipate delays in its first quarter 2020 earnings report, its Securities and Exchange Commission filings, or its annual meeting to be held April 28.
In other news, BMO Capital Markets analyst Garrick Johnson downgraded stock ratings for Malibu Boats and Brunswick Corp. from “outperform” to “perform.”
The most important macroeconomic variables in determining consumer spending in the recreational marine industry are asset prices and employment, Johnson wrote in a note.
With the S&P down 27 percent from highs just six weeks ago and the number of Americans applying for unemployment benefits soaring to 10 million, analysts expect a pullback in spending on boats.
Marine dealers tend to be small businesses that are dependent upon consistent cash flow, Johnsonwrote.
“We fear that some won't be able to withstand the current downturn in business,” he said. “So far, though, marine dealers have made valiant efforts to stay open by implementing new omni-channel solutions and drive-through servicing.”