Market Overview

Marine Products Corporation Reports Second Quarter 2018 Financial Results

Share:

Marine Products Corporation Reports Second Quarter 2018 Financial Results

- Record Quarterly Net Sales of $87.0 million

- Record Net Income of $9.0 million, and Record Diluted Earnings Per Share of $0.26

PR Newswire

ATLANTA, July 25, 2018 /PRNewswire/ -- Marine Products Corporation (NYSE:MPX) announced its unaudited results for the quarter ended June 30, 2018.  Marine Products is a leading manufacturer of fiberglass boats under two brand names: Chaparral and Robalo. Chaparral's sterndrive models include H2O Sport and Ski & Fish Boats, SSi and SSX Sportboats, Sunesta Sportdecks and Signature Cruisers.  In addition, Chaparral manufactures SunCoast Sportdeck outboards, Vortex Jet Boats and the Surf Series of Chaparral SSi and SSX Sportboats, Sunesta Sportdecks and H2O models.  Robalo builds outboard sport fishing boats which include center console, dual console, walkaround cabin and Cayman bay boat models.

(PRNewsfoto/Marine Products Corporation) (PRNewsfoto/Marine Products Corporation)

For the quarter ended June 30, 2018, Marine Products generated record quarterly net sales of $87,006,000, a 21.7 percent increase, compared to $71,484,000 in the same period of the prior year.  The increase in net sales was due to a 13.3 percent increase in units sold coupled with a 6.9 percent increase in the average selling price per boat.

Gross profit for the quarter was $19,472,000, a 19.6 percent increase compared to gross profit of $16,287,000 in the same period of the prior year.  Gross profit for the second quarter increased compared to the prior year due to higher net sales.  Gross margin was 22.4 percent in the second quarter of 2018, compared to 22.8 percent in the second quarter of 2017. 

Operating profit for the quarter was $11,151,000, an increase of 27.8 percent, compared to $8,722,000 in the second quarter of last year.  Selling, general and administrative expenses were $8,321,000 in the second quarter of 2018, an increase of 10.0 percent compared to the second quarter of 2017.  Selling, general and administrative expenses increased due to higher incentive compensation consistent with improved operating results.  Selling, general and administrative expenses as a percentage of net sales were lower during the second quarter of 2018 compared to the second quarter of the prior year.  

Net income for the second quarter of 2018 was a record $8,990,000, an increase of $2,871,000 or 46.9 percent compared to the second quarter of 2017.  Diluted earnings per share of $0.26 increased by $0.08 or 44.4 percent compared to the second quarter of 2017.  Marine Products Corporation's effective tax rate during the second quarter was 20.0 percent, a significant decrease compared to 30.3 percent in the second quarter of 2017.  The effective tax rate declined compared to the prior year due to the Tax Cuts and Jobs Act enacted during the fourth quarter of 2017. 

Net sales for the six months ended June 30, 2018 were $164,542,000, an increase of 15.4 percent compared to the first six months of 2017.  Net income for the six-month period was $16,599,000 or $0.48 diluted earnings per share, compared to net income of $11,380,000, or $0.33 diluted earnings per share in the prior year. 

Richard A. Hubbell, Marine Products' President and Chief Executive Officer stated, "Our record results this quarter were driven by sales of a number of our Robalo models and several Chaparral SSX, Surf and Suncoast models. Our dealer inventories have increased slightly compared to the same time last year, although they have declined during the second quarter as compared to the first quarter of 2018.  In addition, we are pleased to report continued strong market positions in both our sterndrive and outboard sport fishing boat product lines.  For the 12-month period ending in March 2018, Chaparral maintained its multi-year position as the largest sterndrive manufacturer in its size category, with a market share of 16.7 percent.  In addition, Robalo also maintained its market position as the third largest brand in its category, with a market share of 5.3 percent.

During the quarter, we continued our historically high regular quarterly cash dividends and share repurchases under our open market share repurchase program.  In spite of these uses of cash, we finished the second quarter with $27.9 million in cash and marketable securities, an increase of $6.2 million compared with the second quarter of last year," concluded Hubbell. 

Marine Products Corporation will hold a conference call today, July 25, 2018, at 8:00 a.m. Eastern Time to discuss the results for the quarter.  Interested parties may listen in by accessing a live webcast in the investor relations section of Marine Products' website at www.marineproductscorp.com.  The live conference call can also be accessed by calling (888) 394-8218 or (323) 794-2588 for international callers and using the conference ID #5093567.  A replay will be available in the investor relations section of Marine Products' website beginning approximately two hours after the call. 

Marine Products Corporation (NYSE:MPX) designs, manufactures and distributes premium-branded Chaparral sterndrive, jet drive and outboard pleasure boats, and Robalo outboard sport fishing boats.  The Company continues to diversify its product lines through product innovation.  With premium brands, a solid capital structure, and a strong independent dealer network, Marine Products Corporation is prepared to capitalize on opportunities to increase its market share and to generate superior financial performance to build long-term shareholder value.  For more information on Marine Products Corporation visit our website at www.marineproductscorp.com.

Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements that look forward in time or express management's beliefs, expectations or hopes.  In particular, such statements include, without limitation, statements regarding the diversification of our product lines through product innovation; and statements regarding our plans to increase our market share and to generate superior financial performance to build long-term shareholder value. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Marine Products Corporation to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements.  These risks include possible decreases in the level of consumer confidence and available funds impacting discretionary spending, increased interest rates and fuel prices, weather conditions, changes in consumer preferences, deterioration in the quality of Marine Products' network of independent boat dealers or availability of financing of their inventory, continued weakness in the sterndrive recreational boat market, and competition from other boat manufacturers and dealers.  Additional discussion of factors that could cause the actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in Marine Products' Form 10-K, filed with the Securities and Exchange Commission for the year ending December 31, 2017.

 

For information contact:  


BEN M. PALMER              

JIM LANDERS

Chief Financial Officer        

Vice President, Corporate Finance

(404) 321-7910                    

(404) 321-2162

irdept@marineproductscorp.com      

jlanders@marineproductscorp.com

 

 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES





























CONSOLIDATED STATEMENTS OF OPERATIONS  (In thousands except per share data)







Periods ended June 30, (Unaudited)


Second Quarter







Six Months




2018



2017


% BETTER
(WORSE)




2018



2017


% BETTER
(WORSE)


Net Sales

$

87,006


$

71,484


21.7

%


$

164,542


$

142,524


15.4

%

Cost of Goods Sold


67,534



55,197


(22.4)




127,419



111,331


(14.5)


Gross Profit 


19,472



16,287


19.6




37,123



31,193


19.0


Selling, General and Administrative Expenses


8,321



7,565


(10.0)




16,939



15,573


(8.8)


Operating Profit


11,151



8,722


27.8




20,184



15,620


29.2


Interest Income 


85



57


49.1




118



108


9.3


Income Before Income Taxes


11,236



8,779


28.0




20,302



15,728


29.1


Income Tax Provision 


2,246



2,660


15.6




3,703



4,348


14.8


Net Income 

$

8,990


$

6,119


46.9

%


$

16,599


$

11,380


45.9

%





































EARNINGS PER SHARE 


















   Basic  

$

0.26


$

0.18


44.4

%


$

0.48


$

0.33


45.5

%

   Diluted  

$

0.26


$

0.18


44.4

%


$

0.48


$

0.33


45.5

%



















AVERAGE SHARES OUTSTANDING


















   Basic  


34,561



34,936






34,584



34,934




   Diluted  


34,561



34,936






34,584



34,934






















 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES












CONSOLIDATED BALANCE  SHEETS






At June 30, (Unaudited)


(in thousands)



2018



2017

ASSETS






Cash and cash equivalents

$

9,505


$

3,834

Marketable securities


5,996



4,846

Accounts receivable, net


8,522



5,207

Inventories


44,931



41,221

Income taxes receivable


217



1,279

Prepaid expenses and other current assets


1,493



1,629

  Total current assets


70,664



58,016

Property, plant and equipment, net


14,090



13,518

Goodwill 


3,308



3,308

Other intangibles, net


465



465

Marketable securities


12,356



12,941

Deferred income taxes


3,376



5,169

Other assets


10,674



9,070

  Total assets

$

114,933


$

102,487







LIABILITIES AND STOCKHOLDERS' EQUITY






Accounts payable

$

14,606


$

10,352

Accrued expenses and other liabilities


15,729



14,358

  Total current liabilities


30,335



24,710

Long-term pension liabilities


7,084



6,605

Other long-term liabilities


343



59

  Total liabilities


37,762



31,374

Common stock 


3,455



3,488

Capital in excess of par value


-



-

Retained earnings


75,646



69,742

Accumulated other comprehensive loss


(1,930)



(2,117)

  Total stockholders' equity


77,171



71,113

  Total liabilities and stockholders' equity 

$

114,933


$

102,487

 

Cision View original content with multimedia:http://www.prnewswire.com/news-releases/marine-products-corporation-reports-second-quarter-2018-financial-results-300686000.html

SOURCE Marine Products Corporation

View Comments and Join the Discussion!