Brunswick shares Q1 results
For the first quarter of 2025, Brunswick reported consolidated net sales of $1.22 billion, down from $1.37 billion in the first quarter of 2024. First quarter sales were below the prior year as the impact of continued lower wholesale ordering by dealers and OEMs and prudent pipeline management was only partially offset by modest annual price increases and benefits from well-received new products.
Operating earnings were down versus the prior year as a result of the impact of lower sales, lower absorption from decreased production levels, and the negative impact of changes in foreign currency exchange rates, partially offset by new product momentum, annual price increases, and ongoing cost control measures throughout the enterprise.
The Propulsion segment reported a 16 percent decrease in sales versus Q1 2024, resulting from the enterprise factors listed above, while operating earnings were below the prior year primarily due to lower sales and the impact of lower absorption from decreased production levels, partially offset by cost control measures. Sales and operating earnings both grew sequentially versus the fourth quarter of 2024 as OEMs continue to balance inventory ahead of the primary season
The Engine Parts and Accessories segment reported a 3 percent decrease in sales versus the same
period last year due to slightly lower shipments. Sales from the Products business were down 9 percent, while the Distribution business sales were up 2 percent compared to the prior year. Segment operating margin was seasonally strong at 15 percent, up more than 100 basis points versus the prior year, resulting from the efficient operation of the business and slightly lower cost inflation.
The Navico Group segment reported sequentially stronger sales versus the fourth quarter of 2024 and a sales decrease of 1 percent versus Q1 2024, primarily driven by reduced sales to marine OEMs resulting from lower customer boat OEM production levels, mostly offset by strong aftermarket sales and new product momentum. Segment operating earnings decreased due to the lower sales.
The Boat segment reported a 13 percent decrease in sales resulting from anticipated cautious wholesale ordering patterns by dealers, which was only partially offset by the favorable impact of modest model-year price increases.
Freedom Boat Club had another strong quarter, contributing approximately 11 percent of segment sales, including the benefits from recent acquisitions. Segment operating earnings were within expectations as the impact of net sales declines and lower absorption from the reduced production was partially offset by pricing and continued cost control.
“Year to date unit retail sales for our core and premium boat brands and product-lines are in-line with our expectations for a second half biased year, but we are seeing some weakness in entry-level products, prompting us to consider streamlining our product offerings in the entry-level space while growing Freedom Boat Club as an alternative participation model,” said David Foulkes, chairman and CEO of Brunswick. “Early season boat shows are essentially complete, with retail performance at shows flat to prior year and in line with expectations, while overall retail performance in the quarter resulted in appropriate boat field inventory levels as we enter the primary retail season.
“Our propulsion business delivered sequentially improved sales and operating earnings versus the fourth quarter of 2024, although below first quarter 2024 levels, as anticipated,” he continued. “Mercury’s outboard engine lineup continues to take market share, gaining 40 basis points of U.S. retail share on a rolling twelve-month basis, with indications of a strong April performance following significant share increases at 2025 boat shows. Sales to U.S. boat OEMs were strong as our customer builders increased production levels ahead of the primary retail season and engine pipelines remain at appropriate levels.”
2025 Outlook
“As we enter the prime retail season in the U.S., we are keenly aware of the direct impact of tariffs on our business and the new uncertainties faced by our wholesale customers, channel partners, and the end-consumers who buy our products at retail around the world,” Foulkes said. “Although we cannot control the ever-changing conditions in which we do business, we can control our response and continue to push forward our strategic initiatives.”
The company plans to continue investing in new products and technologies, drive differentiation and market share gains for its brands, work closely and dynamically with its channel partners to maintain healthy and appropriate boat, engine and parts pipelines, and support them with appropriate incentive programs, mitigate the direct tariff impact on its business, and maintain optionality through supply chain actions, including targeted onshoring.
“We are also evaluating opportunities to improve profitability and cash flow through rationalization of our manufacturing footprint, incremental COGS and operating expense reductions, and ongoing capital management,” Foulkes added.
Brunswick’s expects net sales between $5 billion and $5.4 billion, adjusted diluted EPS in the range of $2.50 to $4, Free Cash Flow in excess of $350 million, and in the second quarter of 2025, revenue of between $1.1 to $1.3 billion, and adjusted diluted EPS of between $0.80 and $1.10.
