Improving supply environment and continuing high demand drive double-digit increases in both revenues and profits for US boatbuilder

Robalo R250

Improvements in both supply chain and logistics allowed Marine Products to accelerate product shipments during the fourth quarter and increase fulfilment rates on popular models like its Robalo R250

Georgia, US-based fibreglass boat builder Marine Products Corp released its FY2022 fourth quarter and full year financial results on Wednesday, reporting record revenues and double-digit profit growth.

For the quarter ended December 31, 2022, the manufacturer of the Chaparral and Robalo fibreglass boat brands reported net sales of US$108.5m, representing a 42% year-over-year increase over the $76.5m in net sales reported for the fourth quarter of FY2021.

The sales bump was directly attributed to a 29% increase in the number of boats shipped during the quarter, and a 12% increase in the average selling price per boat. 

Marine Products Consolidated Results (for period ending 31 December
 $ millions Q4 ’22 Q4 ’21Change FY ’22 FY ’21Change
 Net sales  108.51  76.54 41.8% 380.99  298.01 27.8%
 Gross profit  27.32 19.16 42.6% 93.72 68.27 37.3%
 Operating profit (EBIT)  14.85 10.66 39.3% 51.80 36.39 42.3%
 Income before taxes  15.13 10.66 42.0% 52.13 36.41 43.2%
 Net Income (after taxes)  11.86 8.45 40.4%
40.35 29.03 39.0%

Gross profit for the period of $27.3m marked a 42% YoY gain over the gross profit of $19.2m earned in the previous fourth quarter, with gross margin as a percentage of net sales flat at 25%.

SSX-347-Run-02-21

High demand for larger and more feature-rich models like the Chaparral SSX 347 helped drive both fourth quarter and full year net sales to record levels for the US boatbuilder

A 47% year-over-year increase in selling, general and administrative expenses, from $8.5m to $12.5m, left a Q4 operating profit of $14.8m, marking a 39% YoY increase over the operating profit of $10.6m earned in the prior Q4.

Net income for the fourth quarter was reported as a record $11.9m, representing a 40% YoY increase over net income of $8.4m earned in the fourth quarter of 2021.

Q4 EBITDA jumped by 38% year-over-year, to $15.3m.

A record full year

For its full 2022 fiscal year Marine Products reported record net sales of $381.0m, marking a 28% year-over-year increase over net sales of $298m reported for the 2021 fiscal year.

Full-year gross profit was reported as $93.7m, marking a 37% YoY increase over the $68.2m reported for the prior year.

A 31% increase in selling, general and administrative expenses – to $41.9m – resulted in a full year operating profit of $51.7m, up by 42% over the $36.3m reported one year ago.

Net income was reported as a record $40.3m, for a 39% YoY gain over net income of $29.0m earned for FY2021.

EBITDA of $53.7m marked a 40% YoY increase over the $38.2m reported for the prior fiscal year.

Demand remains strong

Marine Products president and CEO Ben Palmer attributed the record results to a combination of high consumer demand for boats and improvements in both supply chain and transportation bottlenecks, which allowed the company to increase shipments to dealers.

“Our fourth quarter 2022 shipments were the highest of any quarter in 2022 in spite of the seasonal impact of two holidays”

– Marine Products president and CEO, Ben Palmer

“Our fourth quarter 2022 shipments were the highest of any quarter in 2022 in spite of the seasonal impact of two holidays,” said Palmer. “While production and transportation challenges continue, we are pleased with the improvement. At the end of the quarter, field inventories began to increase to support our dealers during the upcoming 2023 winter boat show season.”

In a call with analysts Palmer noted that the company is maintaining a high production schedule on the strength of encouraging early results from this winter’s boat shows, while continuing to monitor the market closely for any impacts stemming from interest rate increases or economic uncertainty.

“We still have virtually every dealer telling us, send us as many boats as you can”

– Marine Products vice president of corporate services, Jim Landers

It’s also still working to catch up on backorders, according to Marine Products vice president of corporate services, Jim Landers. “We still have unfulfilled orders, and we still have virtually every dealer telling us, send us as many boats as you can,” he said. “A lot of our production is still retail-sold, which prior to Covid was usually not the case.

“The demand is still quite strong. Certainly the retail orders on hand are less than they were six to 12 months ago. But the demand is still quite strong, we’ve not yet seen any softness there. Dealer field inventory continues to remain low by historical standards, so even if things softened a bit, I don’t expect there’s going to be any significant decline in demand.”