MarineMax, Inc. (NYSE:HZO) announced results for its third quarter ended June 30, 2017.
Revenue was $329.8 million for the quarter ended June 30, 2017, compared with $345.6 million for the comparable quarter last year. Same-store sales decreased 10 percent following 44 percent growth comparison in the same period a year ago. Due primarily to the strength of product margins and a rise in the company’s traditionally higher margin businesses, gross margin increased 290 basis points in the quarter ended June 30, 2017 over the prior year. The company’s net income was $14.2 million, or $0.57 per diluted share for the quarter ended June 30, 2017, compared to net income of $13.8 million, or $0.56 per diluted share for the comparable quarter last year.
Revenue increased 12 percent to $801.7 million for the nine months ended June 30, 2017 compared with $714.7 million for the comparable period last year. Same-store sales grew approximately 6 percent on top of 25 percent growth for the comparable period last year. Net income for the nine months ended June 30, 2017 was $19.6 million or $0.78 per diluted share, up 13 percent, compared with net income of $17.0 million, or $0.69 per diluted share for the comparable period last year.
“We are pleased with our team’s ability to drive unit sales growth and strong gross margin expansion during the important June quarter. Reports of industry softness in larger product categories, combined with delayed sales due to unseasonal Northeast weather, dampened our overall revenue and therefore earnings in the quarter,” said William H. McGill, Jr., chairman, president and chief executive officer of MarineMax. “We believe the revenue impact from these challenges will be made up in the future as the underlying trends in the industry are healthy, as evidenced by our ability to grow units on a comparable basis and meaningfully increase gross margins in the quarter. Our product portfolio, new innovative models and customer centric approach continues to resonate well with consumers."
During a webcast on the third quarter results, McGill also said that inventory was tighter than ideal for the company and dealers nationwide. MarineMax's inventory of recreational day boats were particularly tight, and the company believes unit growth would have been higher this quarter if the product had been available.
The third quarter also marked the first full quarter since the Hall Marine Group acquisition was completed, and McGill said the integration in business combination with Hall Marine Group has gone very well.
MarineMax overall remains confident about the 2017 fiscal year, despite third-quarter softness in large boat sales.
“We remain confident in our ability to deliver industry leading results. Fundamentally, the demand for the boating lifestyle remains strong and our long-term outlook for the industry is intact,” said McGill. “With our capital rich balance sheet, healthy inventory levels, premium brands and strong team, we are well positioned to drive earnings and cash flows while taking advantage of opportunities that may arise.”
Based on current business conditions, retail trends and other factors, the company is updating its annual guidance expectations for fully taxed earnings per diluted share to be in the range of $0.97 to $1.02 for fiscal 2017, from $1.14 to $1.24. These expectations do not take into account or give effect for future material acquisitions that may be completed by the company during the fiscal year or other unforeseen events.