Fountain Powerboat impacted by steep market decline

WASHINGTON, N.C. — Fountain Powerboat reported its second-quarter and six-month financial results on Monday, which reflected a downturn that accelerated toward the end of 2008.

Net sales for the first six months of fiscal 2009, which ended Dec. 31, were $23,427,947, compared to net sales of $33,245,468 for the first six months of fiscal 2008. Net sales for the second quarter of fiscal 2009, which also ended Dec. 31, were $5,839,908, compared to net sales of $15,196,038 for the same quarter of fiscal 2008.

“The recreational fiberglass boating market downturn has continued for three years, with the decline deepening sharply in the quarter ended December 31, 2008,” said Reginald M. Fountain, Jr., Fountain Powerboat Industries Chairman, Chief Executive Officer and President, in a statement. “The global economic downturn, finance industry collapse and stock market crash had significant detrimental effect on marine markets during the quarter. Retail financing for boats tightened and floor plan financing for boat dealers became very difficult. With dealers reluctant to replenish their inventories and retail sales stymied, orders for off season production became scarce.”

The gross loss for the second quarter was $1,031,092, compared to a gross profit of $2,216,271 for the second quarter of fiscal 2008. Net loss for the quarter was $3,178,585, or net loss per share of $0.73 on a basic and diluted basis, versus a net loss of $765,055, or net loss per share of $0.16 on a basic and diluted basis, for the second quarter of fiscal 2008.

Gross profit was $1,187,226 for the first six months of fiscal 2009, compared to gross profit of $4,920,857 for the first six months of fiscal 2008. The company's net loss was $3,096,816, or a loss per share of $0.71 on a basic and diluted basis, compared to a net loss of $491,676, or a loss per share of $0.10 on a basic and diluted basis, for the first six months of fiscal 2008.

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