MasterCraft sales up 7 percent for quarter

MasterCraft posted a net sales gain of 7 percent and unit growth of 10 percent for the first quarter of fiscal 2016, the company reported Thursday.

“We kicked off fiscal 2016 with very strong performance, delivering notable top- and bottom-line increases, and double-digit unit volume growth,” said Terry McNew, MasterCraft’s president and CEO. “These gains were driven by continued demand for performance sport boats and innovative new and complementary MasterCraft products like our NXT models.”

Net sales for the three months ended September 27, 2015, were $56.0 million, up $3.6 million, or 6.8 percent, compared to $52.4 million for the three months ended September 28, 2014. MasterCraft-only sales, which exclude the terminated Hydra-Sports manufacturing contract, increased $7.1 million, or 14.6 percent, versus the prior year. The net sales gain was primarily due to a rise in MasterCraft unit volume of 61 units, or 9.8 percent. Net sales per MasterCraft unit grew by 3.8 percent, chiefly stemming from greater adoption of higher-end option packages and price increases.

Said McNew, “Once again, favorable macroeconomic conditions in the United States are fueling consumer demand for boats—and this was echoed in our performance gains. While we are seeing headwinds outside of the United States, most notably in Canada, that are partially offsetting U.S. results, we expect MasterCraft to continue to efficiently meet domestic demand, capture additional market share and deliver profitable, sustained growth.”

Gross profit for the three months ended September 27, 2015, increased $3.0 million, or 23.4 percent, to $15.8 million, compared to $12.8 million a year earlier. Gross margin rose to 28.3 percent for the fiscal 2016 first quarter, from 24.4 percent for the prior-year period. The increase primarily stemmed from cost reductions delivered by a culture focused on eliminating waste, sales of higher-end content option packages which lift average margins per unit, and operating leverage from sales gains. In addition, the company replaced its discontinued Hydra-Sports volume with higher margin MasterCraft volume.

Selling and marketing expense rose $0.4 million to $2.5 million for the three-month period, compared to $2.1 million for the year-earlier first quarter, primarily due to higher spending in connection with the MasterCraft Throwdown wakeboarding competition televised on ESPN. General and administrative expense totaled $9.3 million, versus $2.6 million for the fiscal 2015 three-month period. This expected increase resulted mainly from $5.4 million of stock-based compensation, $0.5 million in higher legal costs and fees and expenses related to the Company’s initial public offering, and $0.5 million in costs associated with being a public company.

Net loss for fiscal 2016 first quarter was $1.3 million, compared to net income of $1.4 million for fiscal 2015 first quarter. The decrease is primarily due to increased operating expenses as described above, partially offset by the contribution from higher net sales.

Fiscal 2016 first quarter adjusted EBITDA was $10.7 million, up 33.8 percent from $8.0 million for the year-earlier quarter.

Fiscal 2016 first quarter adjusted net income increased 50.0 percent to $5.7 million, or $0.30 per share, on a pro-forma, diluted weighted average share count of 18.9 million shares. See below for a reconciliation of adjusted EBITDA and adjusted net income to net income.

Read the full earnings report here.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button