Company Announcement - Malibu Boats, Inc. will release its fourth quarter and full-year fiscal 2025 financial results on August 28, 2025, before the market opens [1] - A conference call to discuss the results will be hosted by CEO Steve Menneto and CFO Bruce Beckman at 8:30 a.m. Eastern Time on the same day [1] Conference Call Details - Investors and analysts can listen to the conference call by dialing (844) 695-5523 or (412) 317-0699 [2] - A live webcast of the conference call will be available on the Investor Relations section of the company's website, with a replay archived for twelve months [2] Company Overview - Malibu Boats, Inc. is a leading designer, manufacturer, and marketer of recreational powerboats, including performance sport, sterndrive, and outboard boats [3] - The company is the market leader in the performance sport boat category through its Malibu and Axis brands and leads the 20' - 40' segment of the sterndrive boat category with its Cobalt brand [3] - Malibu Boats also holds a leading position in the saltwater fishing boat market with brands such as Pursuit, Cobia, Pathfinder, Maverick, and Hewes [3] - The company is recognized as an innovator in the powerboat industry, catering to a diverse range of recreational boaters and water sports enthusiasts [3]

Core Insights - Axis Wake has launched the 2026 Axis T250, the largest and most powerful model in its history, designed for wakeboarders, wakesurfers, and foilers [1][2] - The T250 measures 25 feet in length and features aggressive styling, intuitive design, and upgrades focused on comfort, control, and versatility [2][4] - The new model emphasizes simplicity, performance, and style, aligning with Axis Wake's core values [4][5] Product Features - The T250 includes a redesigned tower with optional color customization, low-profile speaker mounts, and increased headroom [8] - It features a cast-metal-framed windshield for enhanced strength and durability [8] - Helm upgrades include Axis surf and wake presets, a one-touch Home button, and premium interior touches like hinged seats and wireless charging [8] - The boat is equipped with Wake Plus Hull™, Surf Gate®, and Power Wedge® III for customizable waves and wakes [8] - It offers a fuel-efficient running surface and improved handling for better ride quality in rough waters [8] Company Overview - Malibu Boats, Inc. is a leading designer and manufacturer of recreational powerboats, including performance sport and sterndrive boats [6] - The company is recognized as a market leader in the performance sport boat category through its Malibu and Axis brands [6] - Malibu Boats aims to innovate and cater to a diverse range of recreational boaters and watersports enthusiasts [6]

Core Insights - Malibu Boats, Inc. has appointed Melanie Cook, former COO of GE Appliances, to its Board of Directors as an independent director, effective immediately [1][2] - Cook will serve on the Audit Committee and the Nominating and Governance Committee, bringing over three decades of leadership experience in operations and manufacturing [1][2] - Her appointment is part of Malibu's strategy to strengthen its board and advance long-term goals, coinciding with the upcoming retirement of John Stokely in October 2025 [4][5] Company Overview - Malibu Boats, Inc. is a leading designer, manufacturer, and marketer of recreational powerboats, including performance sport, sterndrive, and outboard boats [6] - The company is a market leader in the performance sport boat category through its Malibu and Axis brands, and holds leading positions in other segments such as sterndrive and saltwater fishing boats [6] - Malibu Boats focuses on innovation and aims to appeal to a diverse range of recreational boaters and water sports enthusiasts [6]

Core Insights - Malibu Boats continues its partnership with General Motors, naming Chevrolet as the Official Vehicle Brand, enhancing their collaboration in the boating industry [2][4] - The partnership focuses on the vertical integration of the Monsoon Line of engines, which are exclusively designed for Malibu and Axis Boats [3][4] - This collaboration aims to leverage advanced technology to improve performance, fuel economy, and reliability in boating experiences [3][6] Company Overview - Malibu Boats, Inc. is a leading designer and manufacturer of recreational powerboats, holding a significant market position in various categories including performance sport boats and sterndrive boats [7] - The company is recognized for its innovation in the powerboat industry, catering to a diverse range of recreational boaters and water sports enthusiasts [7] Partnership Details - The partnership will support Malibu's initiatives such as the Malibu Just Ride Tour and WakeFest TN, ensuring the brand remains at the forefront of the boating industry [4] - Chevrolet's vehicles, including the Silverado and Tahoe, are popular among boat owners, reinforcing the synergy between the two brands [4]

Core Insights - The 2025 Just Ride Tour, hosted by Malibu Boats, is set to return, offering an immersive on-water experience across North America with over 45 stops [5][7][11] - The tour features the Malibu Wakesetter 24 MXZ, towed by the Chevrolet Silverado 3500HD High Country, showcasing the performance of Malibu Boats [5][7] - The event emphasizes community engagement, allowing families and riders to connect with Malibu pro athletes for hands-on instruction and product demonstrations [2][4][8] Company Overview - Malibu Boats, based in Loudon, Tennessee, is a leading designer and manufacturer of recreational powerboats, including performance sport and sterndrive boats [14] - The company is recognized as a market leader in the performance sport boat category through its Malibu and Axis brands [14] - Malibu Boats collaborates with GM Marine to develop the Monsoon engine lineup, which powers their boats and enhances performance [9][10] Product Highlights - The Monsoon engine lineup includes the GM 6.2-liter supercharged V8 LT4 engine, delivering 607 horsepower and 606 lb-ft of torque, specifically adapted for marine use [9] - The Just Ride Tour showcases the capabilities of Malibu's boats, particularly the Wakesetter 24 MXZ, which is designed to create exceptional wakes and waves [6][9] Marketing and Sponsorship - The tour is supported by various sponsors, enhancing the overall experience for participants [10] - Malibu Boats aims to bring the Malibu lifestyle to communities, emphasizing the connection between boating enthusiasts and the brand [11]

Core Insights - Malibu Boats has welcomed Aquaknox Marine to its dealer network, enhancing its presence in East Tennessee [1][4] - Aquaknox Marine, founded in 2008, emphasizes professionalism, transparency, and customer experience in the boating industry [2][3] - The partnership aims to provide a full lineup of Malibu and Axis Wake boats, improving customer access to high-quality watersports experiences [3][4] Company Overview - Malibu Boats, based in Loudon, Tennessee, is the largest manufacturer of watersports towboats, including brands like Malibu and Axis Wake [5] - The company is known for its innovative products such as Surf Gate®, Power Wedge®, and Malibu Command Center™, which enhance the watersports experience [5] Dealer Profile - Aquaknox Marine operates two locations in East Tennessee and is recognized for its commitment to customer service and industry knowledge [3] - The company aims to build trust within the boating community by prioritizing customer satisfaction and integrity [2][3]

Group 1 - Malibu Boats reported revenue of $228.66 million for the quarter ended March 2025, representing a 12.4% increase year-over-year [1] - The earnings per share (EPS) for the quarter was $0.72, up from $0.63 in the same quarter last year, with an EPS surprise of +7.46% compared to the consensus estimate of $0.67 [1] - The reported revenue exceeded the Zacks Consensus Estimate of $223.38 million by +2.37% [1] Group 2 - Key metrics indicate that Malibu Boats' net sales per unit totaled $159,792, which was below the average estimate of $166,199.50 [4] - The unit volume by segment was 1,431, surpassing the two-analyst average estimate of 1,346 [4] - Revenue by product showed mixed results: Malibu generated $102.20 million, significantly above the estimate of $67.55 million; Cobalt generated $54.60 million, below the estimate of $71.70 million; and Saltwater Fishing generated $71.90 million, below the estimate of $84.15 million, reflecting a year-over-year decline of -11.5% [4] Group 3 - Over the past month, shares of Malibu Boats returned +5%, while the Zacks S&P 500 composite increased by +11.3% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Company Performance - Malibu Boats reported quarterly earnings of $0.72 per share, exceeding the Zacks Consensus Estimate of $0.67 per share, and up from $0.63 per share a year ago, representing an earnings surprise of 7.46% [1] - The company posted revenues of $228.66 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 2.37%, compared to year-ago revenues of $203.42 million [2] - Over the last four quarters, Malibu Boats has surpassed consensus EPS estimates three times and topped consensus revenue estimates four times [2] Stock Performance - Malibu Boats shares have declined approximately 20.8% since the beginning of the year, while the S&P 500 has decreased by 4.3% [3] - The current consensus EPS estimate for the coming quarter is $0.77 on revenues of $210.93 million, and for the current fiscal year, it is $1.82 on revenues of $806.15 million [7] Industry Outlook - The Leisure and Recreation Products industry, to which Malibu Boats belongs, is currently ranked in the bottom 28% of over 250 Zacks industries, indicating potential challenges ahead [8] - The performance of Malibu Boats may be influenced by the overall outlook for the industry, as research shows that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1 [8]

Financial Data and Key Metrics Changes - Net sales increased by 12.4% to $228.7 million, with unit volume rising by 12.8% to 1,431 units, driven primarily by increased unit volumes in the Malibu segment and favorable model mix across all segments [16][19] - Gross profit rose by 13.4% to $45.7 million, with gross margin as a percentage of sales increasing by 20 basis points to 20% [18] - Q3 GAAP net income surged by 119.4% to $13.2 million, while adjusted EBITDA increased by 16% to $28.3 million, with adjusted EBITDA margin rising by 40 basis points to 12.4% [19][20] - Non-GAAP adjusted fully distributed net income per share increased by 14.3% to $0.72 [20] Business Line Data and Key Metrics Changes - The Malibu and Axis brands accounted for approximately 52% of unit sales, while saltwater fishing represented 22.8%, and Cobalt made up the remaining 25.2% [17] - Consolidated net sales per unit decreased by 0.3% to $159,792, primarily due to an unfavorable segment mix [18] Market Data and Key Metrics Changes - Dealer inventories entering the selling season are healthy and well below last year's levels, with expectations to bring dealer inventories down to the mid-teens percentage [9][27] - Retail environment remains challenging due to elevated interest rates and macroeconomic uncertainty, affecting consumer sentiment and discretionary spending [9] Company Strategy and Development Direction - The company emphasizes innovation as a cornerstone of its competitive advantage, with nearly 40% of Malibu boat show unit sales driven by two new premium models introduced this year [11] - The company is committed to maintaining dealer health and operational excellence while navigating current market conditions [13] - A balanced approach is maintained, focusing on long-term dealer and brand health over short-term volume [22] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the ongoing industry softness but highlights solid execution and growth in Q3, with expectations for retail markets to decline by double digits for the full fiscal year [6][22] - The company does not expect tariffs to have a material impact on its cost structure for the remainder of fiscal 2025 and is deploying various tariff mitigation strategies [23] Other Important Information - Capital expenditures are expected to be tightened to $25 million to $30 million, with a modest reduction in share repurchases planned [21] - The company finished Q3 with over $39 million in cash and over $300 million in untapped liquidity on its credit facility [21] Q&A Session Summary Question: What would the goal be by June with respect to dealer inventory? - The company expects to bring dealer inventories down to the mid-teens percentage, below last year's levels [27][28] Question: How is the behavior of Malibu customers changing? - Retail is seeing some repeat buyers returning, particularly cash repeat buyers, while new buyers remain a small percentage of overall retail [30][31] Question: What are the competitor promotional activities like? - The company has maintained consistent promotional levels and does not expect to elevate them significantly, focusing on new product performance [36][37] Question: What is the company's tariff risk? - The company sources about 18% to 20% of its cost of sales from outside the US, with no singular large sources identified [45][46] Question: How is demand trending in the quarter? - Demand has followed a seasonal ramp but has not met previous expectations for robust growth [51] Question: What changes have occurred in the saltwater segment? - There was some improvement in the saltwater segment, particularly in Florida, but it did not return to growth [60] Question: What has changed in the cost structure leading to adjusted EBITDA pressure? - Adjustments were made to production levels based on market expectations, impacting overall financial projections [68] Question: How will capital allocation be managed in the current environment? - The company remains committed to capital allocation priorities but may modify tactics based on market realities [69]

Financial Data and Key Metrics Changes - Net sales increased by 12.4% to $228.7 million, with unit volume rising by 12.8% to 1,431 units, driven primarily by increased unit volumes in the Malibu segment and favorable model mix across all segments [15][16] - Gross profit rose by 13.4% to $45.7 million, with gross margin as a percentage of sales increasing by 20 basis points to 20% [16] - Q3 GAAP net income surged by 119.4% to $13.2 million, while adjusted EBITDA increased by 16% to $28.3 million, with adjusted EBITDA margin rising by 40 basis points to 12.4% [17][18] - Non-GAAP adjusted fully distributed net income per share increased by 14.3% to $0.72 [18] Business Line Data and Key Metrics Changes - The Malibu and Axis brands accounted for approximately 52% of unit sales, while saltwater fishing represented 22.8%, and Cobalt made up the remaining 25.2% [15] - Consolidated net sales per unit decreased by 0.3% to $159,792, primarily due to an unfavorable segment mix [16] Market Data and Key Metrics Changes - Dealer inventories entering the selling season are healthy and well below last year's levels, with expectations to bring dealer inventories down to the mid-teens percentage [7][24] - Retail environment remains challenging due to elevated interest rates and macroeconomic uncertainty, affecting consumer sentiment and discretionary spending [7][20] Company Strategy and Development Direction - The company emphasizes innovation as a cornerstone of its long-term strategy, with nearly 40% of Malibu boat show unit sales driven by two premium models introduced this year [10] - The company is committed to maintaining dealer health and operational excellence while navigating current market conditions [12][19] - A balanced approach is maintained, focusing on dealer health, operational excellence, and continued innovation [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating current market conditions, highlighting a strong balance sheet and robust cash flow generation [13][19] - The company has recalibrated expectations for the upcoming selling season, now expecting retail markets to be down double digits for the full fiscal year [20] - Management does not expect tariffs to have a material impact on the cost structure for the remainder of fiscal 2025 [21] Other Important Information - Capital expenditures are expected to be tightened to $25 million to $30 million, with a modest reduction in share repurchases planned [19] - The company generated over $15 million in cash from operations during the quarter and finished Q3 with over $39 million in cash on hand [18][19] Q&A Session Summary Question: What would the goal be by June with respect to dealer inventory? - The company expects to bring dealer inventories down to the mid-teens percentage, below last year's levels [24][25] Question: Insights into customer behavior, particularly repeat buyers and first-time buyers? - Retail trends show repeat buyers, especially cash buyers, returning, while new buyers remain a small percentage of overall retail [28][29] Question: What are the observations regarding competitor promotional activity? - The company has maintained consistent promotional levels and has not had to elevate them significantly due to strong new product performance [33][34] Question: How is the saltwater segment performing? - There was an improvement in the saltwater segment, particularly in Florida, but it did not bounce back to growth [56][57] Question: What has changed in the cost structure leading to adjusted EBITDA pressure? - Adjustments were made to production expectations based on market conditions, impacting overall financial projections [63]