MasterCraft Boat Holdings (NASDAQ:MCFT) announced on Tuesday an international expansion with new dealerships in Mexico and Germany being set up through its MasterCraft Boat Company subsidiary. "Global demand for the MasterCraft experience continues to grow, and expanding our dealer network ensures ...

International Expansion Fuels MasterCraft’s Mission to Deliver Unmatched Craftsmanship, Performance and Luxury to Boaters Around the WorldVONORE, Tenn., Sept. 09, 2025 (GLOBE NEWSWIRE) -- MasterCraft Boat Company, a subsidiary of MasterCraft Boat Holdings, Inc (NASDAQ: MCFT) and the best-selling towboat brand, today announced an international expansion with new dealerships in Mexico and Germany. The expanded dealership network delivers MasterCraft’s industry-leading towboats, and its exceptional service, to ...

Core Insights - The article emphasizes the investment philosophy focused on small cap companies, highlighting the importance of identifying mispriced securities through understanding financial drivers and utilizing DCF model valuation [1] Group 1: Investment Philosophy - The investment approach is not confined to traditional categories such as value, dividend, or growth investing, but rather considers all prospects of a stock to assess risk-to-reward [1] Group 2: Market Focus - The investment strategy encompasses markets in the US, Canada, and Europe, indicating a broad geographical focus for potential investment opportunities [1]

[CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=3&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section emphasizes that all forward-looking statements are subject to estimates and uncertainties, with no company obligation to update them unless legally mandated - All forward-looking statements involve estimates and uncertainties that could cause actual results to differ materially from those expressed[11](index=11&type=chunk) - These statements are based on assumptions made in light of industry experience, historical trends, current conditions, and expected future developments[12](index=12&type=chunk) - The company undertakes no obligation to update any forward-looking statement, except as required by law[13](index=13&type=chunk) [BASIS OF PRESENTATION](index=3&type=section&id=BASIS%20OF%20PRESENTATION) The company's fiscal year runs from July 1 to June 30, with results from former Aviara and NauticStar units reported as discontinued operations - The company's fiscal year begins on July 1 and ends on June 30[14](index=14&type=chunk) - MasterCraft Boat Holdings, Inc. operates primarily through its wholly-owned subsidiaries: MasterCraft Boat Company, LLC, MasterCraft Parts, Ltd., and Crest Marine, LLC[15](index=15&type=chunk) - Results related to the former Aviara (sold October 2024) and NauticStar (sold fiscal 2023) reporting units are reported as discontinued operations for all periods presented[16](index=16&type=chunk) PART I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) MasterCraft Boat Holdings, Inc. is a leading designer, manufacturer, and marketer of recreational powerboats under three brands: MasterCraft, Crest, and Balise. The company focuses on innovation, quality, and consumer experience across its ski/wake and pontoon segments, supported by extensive dealer networks and dedicated manufacturing facilities [Our Segments](index=4&type=section&id=Our%20Segments) The company operates two primary segments: MasterCraft, focusing on premium ski/wake boats, and Pontoon, encompassing Crest and Balise brands in the largest unit-producing powerboat category - The MasterCraft segment manufactures and sells premium ski/wake boats under the MasterCraft brand, known for high performance, premier quality, and relentless innovation[19](index=19&type=chunk) - The Pontoon segment manufactures and sells pontoon boats under the Crest (acquired October 2018) and Balise (launched April 2024) brands, participating in the largest unit-producing category in the powerboat industry[20](index=20&type=chunk)[21](index=21&type=chunk) [Our Products](index=4&type=section&id=Our%20Products) The company offers a diverse range of recreational powerboats, including MasterCraft ski/wake models and Crest and Balise pontoon boats, with varying retail price points - MasterCraft offers ProStar, XStar, X, XT, and NXT models for water skiing, wakeboarding, wake surfing, and general recreational boating[24](index=24&type=chunk) MasterCraft Product Retail Price Ranges | Model Line | Retail Price Range | | :--------- | :----------------- | | ProStar, XStar, X | $120,000 to $500,000 | | XT | $155,000 to $225,000 | | NXT | $110,000 to $150,000 | - Crest offers pontoon boats across Signature, Premium, Ultimate Luxury, and Electric lines, with retail prices ranging from approximately **$40,000 to $300,000**[25](index=25&type=chunk)[26](index=26&type=chunk) - Balise offers luxury pontoon boats (Horizon and Helix models) with retail prices ranging from **$230,000 to $350,000**[27](index=27&type=chunk) [Distribution and Dealer Relations](index=5&type=section&id=Distribution%20and%20Dealer%20Relations) The company distributes its products through extensive domestic and international independent dealer networks, actively managing dealer health and providing financial incentives to maximize performance - Products are sold through extensive networks of independent dealers domestically and internationally, targeting high-performing dealers[28](index=28&type=chunk) - The company actively monitors dealer health, retail sales, and inventory to expand geographic footprint and improve market coverage[29](index=29&type=chunk) Dealer Network and International Sales (Fiscal 2025) | Metric | MasterCraft | Pontoon | Consolidated | | :----- | :---------- | :------ | :----------- | | Domestic Dealers | 82 | 126 | | | Domestic Locations | 129 | 156 | | | International Dealers | 47 | 9 | | | International Locations | 57 | 10 | | | International Net Sales | | | 11.4% | - Financial incentives (wholesale/retail rebates, promotions, floor plan interest reimbursement) and a proprietary web-based management tool are provided to dealers to maximize performance and enhance communication[32](index=32&type=chunk)[33](index=33&type=chunk) [Manufacturing](index=5&type=section&id=Manufacturing) MasterCraft boats are manufactured in Vonore, Tennessee, and Crest and Balise boats in Owosso, Michigan, utilizing continuous flow processes with both in-house and third-party components - MasterCraft boats and trailers are manufactured and lake-tested at a **310,000 square-foot facility** in Vonore, Tennessee, compliant with ISO 9001, 14001, and 45001 standards[34](index=34&type=chunk) - Crest and Balise boats are manufactured at a **270,000 square-foot facility** in Owosso, Michigan[34](index=34&type=chunk) - Boats are built through a continuous flow manufacturing process, utilizing both in-house components (e.g., upholstery) and components procured from third-party vendors[36](index=36&type=chunk) [Suppliers](index=7&type=section&id=Suppliers) The company sources diverse raw materials and components from a broad supplier base, maintaining strong, long-standing relationships with exclusive engine suppliers like Ilmor for MasterCraft and Mercury Marine for Crest and Balise - The company purchases a wide variety of raw materials (resins, fiberglass, aluminum, lumber, steel) and components (engines, electronic controls) from its supplier base[38](index=38&type=chunk) - Ilmor Engineering, Inc. is the exclusive engine supplier for the MasterCraft brand, and Mercury Marine is the largest engine supplier for Crest and the exclusive supplier for Balise[40](index=40&type=chunk) - The company maintains strong, long-standing relationships with its engine suppliers, which is considered a key competitive advantage[40](index=40&type=chunk) [Research and Development, Product Development and Engineering](index=7&type=section&id=Research%20and%20Development,%20Product%20Development%20and%20Engineering) The company is strategically committed to innovation, with dedicated R&D teams using structured feedback processes to launch new boat models annually, incurring consistent development expenses - The company is strategically and financially committed to innovation, with dedicated product development and engineering groups responsible for new boat models and innovative features[41](index=41&type=chunk) - Structured processes are used to obtain consumer, dealer, and management feedback to guide long-term product lifecycle and portfolio planning, aiming to launch new models annually[42](index=42&type=chunk) Research and Product Development Expense | Fiscal Year | Amount (Millions) | | :---------- | :---------------- | | 2025 | $6.5 | | 2024 | $6.8 | | 2023 | $6.3 | [Intellectual Property](index=7&type=section&id=Intellectual%20Property) The company protects its brands, products, and proprietary technology through a comprehensive portfolio of over 75 U.S. patents, 120 trademark registrations, and 38 registered U.S. copyrights, including vessel hull designs - The company protects its brands, products, and proprietary technology through patents, trademarks, copyrights, trade secret laws, confidentiality procedures, and contractual provisions[43](index=43&type=chunk) - Holds over **75 U.S. patents** and **10 foreign patents** (expiring 2028-2043), including for transom surf seating, DockStar handling system, and SurfStar surf system technology[43](index=43&type=chunk) - Owns over **120 trademark registrations** (MasterCraft, Crest, Balise names/logos, model names) and **38 registered U.S. copyrights**, plus over **20 registered vessel hull designs**[43](index=43&type=chunk) [Competitive Conditions and Position](index=9&type=section&id=Competitive%20Conditions%20and%20Position) The company competes by offering a diversified portfolio of leading brands, focusing on consumer experience, efficient production, and extensive dealer networks, holding a leading market share in ski/wake boats - The company competes by offering a diversified portfolio of leading brands, focusing on consumer ownership experience, efficient production, and extensive dealer networks[44](index=44&type=chunk) - The ski/wake category is relatively concentrated (top five brands **71% market share**), while the pontoon category is fragmented (top five brands **54% market share**) as of March 2025[45](index=45&type=chunk) Market Share (as of March 2025, SSI data) | Brand | Category | Market Share | | :---------- | :---------------- | :----------- | | MasterCraft | Ski/Wake | 19.2% (1) | | Crest | Aluminum Pontoon | 3.0% (11) | [Human Capital Resources](index=9&type=section&id=Human%20Capital%20Resources) As of June 30, 2025, the company employed approximately 700 non-unionized individuals, prioritizing a high-performing, consumer-focused work environment through career development, training, and safety programs - As of June 30, 2025, the company had approximately **700 employees** (500 at MasterCraft, 200 at Pontoon), none of whom are unionized[47](index=47&type=chunk) - A strategic priority is developing a high-performing, consumer-focused work environment that attracts and retains superior employees through career development and training[48](index=48&type=chunk) - Employee safety is a top priority, maintained through vigorous training programs and professional safety standards systems[49](index=49&type=chunk) [Environmental, Safety, and Regulatory Matters](index=9&type=section&id=Environmental,%20Safety,%20and%20Regulatory%20Matters) The company's operations are subject to extensive and evolving environmental, safety, and regulatory laws, with potential future costs or liabilities from new regulations or undiscovered conditions - Operations are subject to extensive and frequently changing federal, state, local, and foreign laws and regulations concerning product safety, environmental protection, and occupational health and safety[51](index=51&type=chunk) - The company believes its operations and products comply with regulatory requirements, but future costs or liabilities from new regulations or undiscovered environmental conditions could have a material adverse effect[51](index=51&type=chunk)[52](index=52&type=chunk) [Item 1A. Risk Factors](index=12&type=section&id=Item%201A.%20Risk%20Factors) The company's operations and financial results are subject to various risks, including those related to global economic conditions (inflation, interest rates), business operations (dealer network dependence, production adjustments, supply chain disruptions, new product introduction, divestitures, human capital), intellectual property (brand strength, infringement), and regulatory/legal/tax environment (tariffs, asset impairment, compliance, litigation) [Risks Relating to Economic and Market Conditions](index=12&type=section&id=Risks%20Relating%20to%20Economic%20and%20Market%20Conditions) Global economic conditions, including inflation, elevated interest rates, and energy costs, can significantly diminish consumer confidence and discretionary income, negatively impacting boat sales, operating costs, and borrowing expenses - Global economic conditions, inflation, and elevated interest rates can diminish consumer confidence and discretionary income, reducing sales of non-essential items like boats and increasing operating costs[56](index=56&type=chunk)[58](index=58&type=chunk)[59](index=59&type=chunk) - Elevated interest rates can incentivize dealers to reduce inventory levels, negatively impacting sales and margins, and increase borrowing costs on the company's variable rate debt[60](index=60&type=chunk)[61](index=61&type=chunk)[63](index=63&type=chunk) - Increases in energy costs can raise manufacturing and shipping expenses, affect raw material prices, and potentially reduce demand for fuel-powered boats[64](index=64&type=chunk) - Fluctuations in foreign currency exchange rates can adversely affect the price of products in foreign markets and the costs of imported components[65](index=65&type=chunk) [Risks Relating to Our Business](index=13&type=section&id=Risks%20Relating%20to%20Our%20Business) Business risks include dependence on dealer networks, challenges in adjusting production to demand, supply chain disruptions, human capital management, potential inventory repurchases, intense competition, and the impact of product recalls or cybersecurity events - Dependence on a network of independent dealers means that weakening demand, tightening credit, or dealer failures could adversely affect distribution and sales[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) - Inability to adjust production for rapidly changing demand (e.g., reducing field inventories in fiscal 2025) can negatively impact profitability and gross/net margins due to lower fixed cost absorption[71](index=71&type=chunk)[72](index=72&type=chunk) - Failure to successfully execute manufacturing strategy, including capacity expansion or divestitures (like the Aviara facility sale in fiscal 2025), could lead to inefficiencies and increased costs[74](index=74&type=chunk)[75](index=75&type=chunk) - Adverse weather conditions, climate change events, and catastrophic events (natural disasters, terrorism) can negatively affect revenues, disrupt operations, and impact the supply chain[76](index=76&type=chunk)[77](index=77&type=chunk)[79](index=79&type=chunk) - Reliance on a complex global supply chain and sole-source suppliers (e.g., Ilmor for MasterCraft engines, Mercury for Balise engines) creates risks from increased costs, supply disruptions, or quality issues[84](index=84&type=chunk)[85](index=85&type=chunk)[87](index=87&type=chunk) - The ability to attract and retain management employees and skilled labor is critical; a tightening labor market or failure in succession plans (e.g., CFO transition) could disrupt operations[89](index=89&type=chunk)[91](index=91&type=chunk) - The company may be required to repurchase dealer inventory under floor plan financing arrangements if dealers default, which could adversely affect cash flow and financial condition[92](index=92&type=chunk)[93](index=93&type=chunk) - Intense competition in the powerboat industry, including from used boats and competitors' pricing strategies, affects sales and profits[95](index=95&type=chunk)[96](index=96&type=chunk) - Significant product repair/replacement costs due to warranty claims or product recalls could materially impact results of operations and harm the company's reputation[98](index=98&type=chunk) - An inability to identify, complete, or successfully integrate targeted acquisitions could negatively impact financial results and divert management attention[99](index=99&type=chunk)[100](index=100&type=chunk) - Negative public perception of products, sustainability practices, or restrictions on product access/use could materially and adversely affect business or results of operations[102](index=102&type=chunk) - Outages, breaches of information technology systems, network disruptions, or cybersecurity events could negatively impact business operations, reputation, and financial condition[103](index=103&type=chunk) - Credit facilities contain covenants that may limit operating flexibility; failure to comply could result in lenders restricting or terminating borrowing ability[106](index=106&type=chunk) - Actual or potential public health emergencies, epidemics, or pandemics could cause significant disruptions to global economies, supply chains, and demand for products[107](index=107&type=chunk)[108](index=108&type=chunk) [Risks Relating to Intellectual Property](index=24&type=section&id=Risks%20Relating%20to%20Intellectual%20Property) The company's success relies on strong brands, but negative publicity or inadequate intellectual property protection against infringement could harm its reputation, sales, and incur significant defense costs - The company's success depends on the continued strength of its brands; negative publicity associated with products, athletes, or sports could harm its reputation and sales[110](index=110&type=chunk)[111](index=111&type=chunk) - Intellectual property rights (patents, trademarks, copyrights, protected designs, trade secrets) may be inadequate to protect the business from misappropriation or independent development by third parties[112](index=112&type=chunk)[117](index=117&type=chunk) - Claims of infringement by third parties could be expensive and time-consuming to defend, potentially forcing the company to cease production, redesign products, or pay significant damages[113](index=113&type=chunk)[114](index=114&type=chunk) [Risks Relating to Our Regulatory, Accounting, Legal, and Tax Environment](index=26&type=section&id=Risks%20Relating%20to%20Our%20Regulatory,%20Accounting,%20Legal,%20and%20Tax%20Environment) The company faces risks from international tariffs, potential asset impairment, extensive regulatory compliance, product liability litigation, workplace liabilities, and changes in income tax laws - International tariffs and changes in trade policies could increase product pricing, decrease consumer demand, and raise manufacturing costs, adversely affecting business and results of operations[115](index=115&type=chunk)[116](index=116&type=chunk) - An impairment in the carrying value of goodwill, trade names, and other long-lived assets could negatively affect consolidated results of operations and net worth, especially if future operating performance is insufficient[118](index=118&type=chunk)[120](index=120&type=chunk) - Compliance with extensive environmental, health, safety, and other regulatory requirements may increase costs, limit operations, or reduce demand for products[121](index=121&type=chunk)[122](index=122&type=chunk) - Manufacturing operations and products create exposure to potential claims and litigation (product quality, warranty, personal injury), which could be costly, exceed insurance coverage, and harm reputation[125](index=125&type=chunk)[126](index=126&type=chunk) - The nature of the business exposes the company to workers' compensation claims and other workplace liabilities, particularly due to handling potentially hazardous substances[127](index=127&type=chunk) - Increases in income tax rates or changes in income tax laws or enforcement could have a material adverse impact on financial results and consumer discretionary income[128](index=128&type=chunk) [Risks Relating to Ownership of our Common Stock](index=30&type=section&id=Risks%20Relating%20to%20Ownership%20of%20our%20Common%20Stock) Risks include inefficient capital allocation, dilution from future stock issuances, the absence of common stock dividends, and potential costs and distractions from activist shareholder actions - Inefficient or ineffective allocation of capital could adversely affect operating results and/or shareholder value[129](index=129&type=chunk) - Future issuances of common stock (e.g., under incentive plans or for acquisitions) would dilute the percentage ownership of existing shareholders[130](index=130&type=chunk)[131](index=131&type=chunk) - The company currently does not intend to pay dividends on its common stock, and future decisions will depend on various factors[132](index=132&type=chunk) - Activist shareholder actions could result in substantial costs, divert management's and the Board's attention, and cause stock price fluctuations[133](index=133&type=chunk)[134](index=134&type=chunk) [Item 1B. Unresolved Staff Comments](index=33&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company has no unresolved staff comments - The company has no unresolved staff comments[136](index=136&type=chunk) [Item 1C. Cybersecurity](index=33&type=section&id=Item%201C.%20Cybersecurity) The company has developed and implemented a cybersecurity risk management program aligned with NIST CSF and ISO 27001, integrated into its overall enterprise risk management. The Board's Audit Committee oversees cybersecurity risks, receiving quarterly reports and annual briefings from the CIO/CISO, who has over 20 years of experience - The company's cybersecurity risk management program is aligned with NIST CSF and ISO 27001 frameworks and integrated into its overall enterprise risk management program[137](index=137&type=chunk)[138](index=138&type=chunk) - The program includes risk assessments, a dedicated security team, use of external service providers, employee awareness training, an incident response plan, and a third-party risk management process[142](index=142&type=chunk) - The Board's Audit Committee oversees cybersecurity and other information technology risks, receiving quarterly reports and at least annual detailed briefings from management[139](index=139&type=chunk)[140](index=140&type=chunk) - The cybersecurity management team is led by the CIO, who also serves as CISO, with over **20 years of experience** in managing cybersecurity functions[141](index=141&type=chunk)[143](index=143&type=chunk) [Item 2. Properties](index=35&type=section&id=Item%202.%20Properties) As of June 30, 2025, MasterCraft boats and trailers are manufactured at a 310,000 square-foot facility in Vonore, Tennessee. Crest and Balise boats are manufactured at a 270,000 square-foot facility in Owosso, Michigan. The company also leases a 3,000 square-foot warehouse facility in West Yorkshire, England - MasterCraft boats and trailers are manufactured and lake-tested at a **310,000 square-foot facility** in Vonore, Tennessee[144](index=144&type=chunk) - Crest and Balise boats are manufactured at a **270,000 square-foot facility** in Owosso, Michigan[144](index=144&type=chunk) - The company leases a **3,000 square-foot warehouse facility** in West Yorkshire, England[144](index=144&type=chunk) [Item 3. Legal Proceedings](index=35&type=section&id=Item%203.%20Legal%20Proceedings) For a discussion of the company's legal proceedings, refer to Note 12 Commitments and Contingencies in the Consolidated Financial Statements - Information regarding the company's legal proceedings is discussed in Part IV – Item 15. – Note 12 Commitments and Contingencies to the Company's Consolidated Financial Statements[145](index=145&type=chunk) [Item 4. Mine Safety Disclosures](index=35&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable[146](index=146&type=chunk) PART II [Item 5. Market for Registrant's Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities](index=36&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%20and%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ under "MCFT." As of August 22, 2025, there were 16,306,356 shares outstanding. The company does not anticipate paying cash dividends but has an active share repurchase program, with $25.9 million remaining under the current $50.0 million authorization as of June 30, 2025 - The company's common stock has been publicly traded on the NASDAQ Global Market under the symbol "**MCFT**" since July 17, 2015[148](index=148&type=chunk) - As of August 22, 2025, there were **16,306,356 shares** of the Registrant's common stock issued and outstanding[6](index=6&type=chunk) - The company presently does not anticipate declaring or paying cash dividends on its common stock[149](index=149&type=chunk) - A new share repurchase program, authorizing up to **$50.0 million**, became effective on July 24, 2023, upon completion of the prior program[151](index=151&type=chunk) - As of June 30, 2025, **$25.9 million** remained available under the new share repurchase authorization[151](index=151&type=chunk) Issuer Purchases of Equity Securities (Q4 Fiscal 2025) | Period | Total Number of Shares Purchased | Average Price Paid Per Share (b) | | :-------------------------- | :------------------------------- | :------------------------------- | | March 31, 2025 - April 27, 2025 | 94,880 | $15.65 | | April 28, 2025 - May 25, 2025 | 64,406 | $17.15 | | May 26, 2025 - June 30, 2025 | 108,374 | $17.94 | | **Total** | **267,660** | | [Item 6. Reserved](index=37&type=section&id=Item%206.%20Reserved) This item is reserved - This item is reserved[160](index=160&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=38&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2025 saw a decrease in net sales and gross margin due to planned lower unit volumes aimed at aligning dealer inventories with retail demand. The company reported a significant decrease in income from continuing operations. Liquidity is supported by cash, investments, and operating activities, with all long-term debt repaid and $100.0 million available on the revolving credit facility. Critical accounting estimates include asset impairment, warranty liability, and revenue recognition [Key Performance Measures](index=38&type=section&id=Key%20Performance%20Measures) Key performance measures include unit sales volume, net sales per unit, gross margin, net income margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income per share, and Free Cash Flow - Key performance measures include unit sales volume, net sales per unit, gross margin, net income margin, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income per share, and Free Cash Flow[165](index=165&type=chunk) [Overview](index=38&type=section&id=Overview) Fiscal 2025 was characterized by market and economic uncertainty, leading to decreased net sales and gross margin, with Aviara and NauticStar reported as discontinued operations and a new CFO appointed - Fiscal 2025 was impacted by anticipated market and economic uncertainty, leading to decreased net sales and gross margin[167](index=167&type=chunk) - The Aviara and NauticStar reporting units are presented as discontinued operations for all periods[163](index=163&type=chunk) - Scott Kent succeeded Timothy M. Oxley as Chief Financial Officer, effective July 1, 2025[164](index=164&type=chunk) - U.S. tariffs did not materially impact fiscal 2025 results, but their effects and potential additional tariffs remain highly uncertain and difficult to predict[166](index=166&type=chunk) [Consolidated Results](index=40&type=section&id=Consolidated%20Results) In fiscal 2025, consolidated net sales decreased by 11.8% to $284.2 million, and income from continuing operations fell by 53.9% to $10.7 million, primarily due to lower unit volumes and reduced gross margin Consolidated Statements of Operations Highlights (Fiscal 2025 vs. 2024) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | % Change | | :--------------------------- | :----------------- | :----------------- | :------------------- | :------- | | Net Sales | $284,203 | $322,351 | $(38,148) | (11.8%) | | Gross Profit | $56,865 | $71,610 | $(14,745) | (20.6%) | | Operating Income | $11,232 | $27,476 | $(16,244) | (59.1%) | | Income From Continuing Operations | $10,715 | $23,243 | $(12,528) | (53.9%) | Consolidated Unit Sales Volume (Fiscal 2025 vs. 2024) | Segment | 2025 | 2024 | Change | % Change | | :---------- | :--- | :--- | :----- | :------- | | MasterCraft | 1,548 | 1,755 | (207) | (11.8%) | | Pontoon | 745 | 1,241 | (496) | (40.0%) | | **Consolidated** | **2,293** | **2,996** | **(703)** | **(23.5%)** | - Gross Margin percentage declined **220 basis points to 20.0%** in fiscal 2025, primarily due to lower cost absorption from decreased production volume, material and overhead inflation, and changes in sales price[169](index=169&type=chunk)[170](index=170&type=chunk) - Interest expense decreased by **$2.1 million**, mainly due to the repayment of all outstanding borrowings under the Credit Agreement during the first six months of fiscal 2025[171](index=171&type=chunk) - The consolidated effective income tax rate decreased to **20.8 percent** for fiscal 2025 from **22.5 percent** for fiscal 2024[172](index=172&type=chunk) [Segment Results](index=42&type=section&id=Segment%20Results) The MasterCraft segment experienced an 8.4% decrease in net sales and a 30.1% decrease in operating income in fiscal 2025, driven by lower unit volumes and increased costs. The Pontoon segment saw a more significant 27.1% decrease in net sales and a substantial increase in operating loss to $9.4 million, also due to decreased unit volume and higher costs [MasterCraft Segment](index=42&type=section&id=MasterCraft%20Segment) The MasterCraft segment's net sales decreased by 8.4% to $240.8 million, and operating income fell by 30.1% to $20.7 million in fiscal 2025, primarily due to lower unit volumes and increased costs MasterCraft Segment Performance (Fiscal 2025 vs. 2024) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | % Change | | :--------------------------- | :----------------- | :----------------- | :------------------- | :------- | | Net sales | $240,763 | $262,736 | $(21,973) | (8.4%) | | Operating income | $20,658 | $29,573 | $(8,915) | (30.1%) | | Unit sales volume | 1,548 | 1,755 | (207) | (11.8%) | | Net sales per unit | $156 | $150 | $6 | 4.0% | - The decrease in operating income was driven by decreased net sales, increased materials and overhead inflation, and increased variable compensation costs[174](index=174&type=chunk) [Pontoon Segment](index=42&type=section&id=Pontoon%20Segment) The Pontoon segment experienced a 27.1% decrease in net sales to $43.4 million and a significant increase in operating loss to $9.4 million in fiscal 2025, primarily due to lower unit volumes and higher costs Pontoon Segment Performance (Fiscal 2025 vs. 2024) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | Change ($ thousands) | % Change | | :--------------------------- | :----------------- | :----------------- | :------------------- | :------- | | Net sales | $43,440 | $59,615 | $(16,175) | (27.1%) | | Operating loss | $(9,426) | $(2,097) | $(7,329) | 349.5% | | Unit sales volume | 745 | 1,241 | (496) | (40.0%) | | Net sales per unit | $58 | $48 | $10 | 20.8% | - The increase in operating loss was primarily due to decreased net sales and increased labor and materials cost[176](index=176&type=chunk) [Non-GAAP Measures](index=43&type=section&id=Non-GAAP%20Measures) The company utilizes non-GAAP measures such as EBITDA, Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow to provide investors with additional insights into operating performance - The company uses non-GAAP measures such as EBITDA, Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow to provide additional information to investors and assess operating performance[177](index=177&type=chunk)[178](index=178&type=chunk)[179](index=179&type=chunk)[180](index=180&type=chunk) Adjusted EBITDA Reconciliation (Fiscal 2025 vs. 2024 vs. 2023) | Metric | 2025 ($ thousands) | % of Net Sales | 2024 ($ thousands) | % of Net Sales | 2023 ($ thousands) | % of Net Sales | | :------------------------------------------------------- | :----------------- | :------------- | :----------------- | :------------- | :----------------- | :------------- | | Income from continuing operations | $10,715 | 3.8% | $23,243 | 7.2% | $93,801 | 15.4% | | EBITDA | $20,811 | 7.3% | $35,851 | 11.1% | $129,825 | 21.3% | | Share-based compensation | $2,915 | | $2,602 | | $3,462 | | | Senior leadership transition and organizational realignment costs | $659 | | $1,708 | | — | | | Business development consulting costs | — | | — | | $312 | | | **Adjusted EBITDA** | **$24,385** | **8.6%** | **$40,161** | **12.5%** | **$133,599** | **21.9%** | Adjusted Net Income Reconciliation (Fiscal 2025 vs. 2024 vs. 2023) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | 2023 ($ thousands) | | :------------------------------------------------------- | :----------------- | :----------------- | :----------------- | | Income from continuing operations | $10,715 | $23,243 | $93,801 | | Adjusted Net Income before income taxes | $18,909 | $36,095 | $127,724 | | Adjusted income tax expense (c) | $3,782 | $7,219 | $29,377 | | **Adjusted Net Income** | **$15,127** | **$28,876** | **$98,347** | | Diluted Adjusted Net Income per share | $0.92 | $1.69 | $5.54 | Free Cash Flow Reconciliation (Fiscal 2025 vs. 2024 vs. 2023) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | 2023 ($ thousands) | | :------------------------------------------------------- | :----------------- | :----------------- | :----------------- | | Net cash provided by operating activities of continuing operations | $38,222 | $12,200 | $136,630 | | Less: Purchases of property, plant and equipment | $(9,198) | $(10,525) | $(24,563) | | **Free cash flow** | **$29,024** | **$1,675** | **$112,067** | [Liquidity and Capital Resources](index=45&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is primarily supported by cash, short-term investments, and operating activities, with all long-term debt repaid in fiscal 2025 and $100.0 million available on its revolving credit facility - Primary liquidity and capital resource needs include financing working capital, funding capital expenditures, servicing debt, funding potential acquisitions, and supporting the share repurchase program[187](index=187&type=chunk) - Principal sources of liquidity are cash balance, short-term investments, cash generated from operating activities, and the revolving credit agreement[187](index=187&type=chunk) Cash and Investments (June 30, 2025 vs. 2024) | Metric | June 30, 2025 ($ millions) | June 30, 2024 ($ millions) | Change ($ millions) | | :---------------------- | :------------------------- | :------------------------- | :------------------ | | Cash and cash equivalents | $28.9 | $7.4 | +$21.5 | | Short-term investments | $50.5 | $78.8 | -$28.3 | - Total debt as of June 30, 2024, was **$49.3 million**, with no amounts outstanding as of June 30, 2025, and **$100.0 million** of available borrowing capacity on the Revolving Credit Facility[188](index=188&type=chunk)[189](index=189&type=chunk) Cash Flow from Continuing Operations (Fiscal 2025 vs. 2024) | Activity | 2025 ($ thousands) | 2024 ($ thousands) | | :------------------- | :----------------- | :----------------- | | Operating activities | $38,222 | $12,200 | | Investing activities | $20,044 | $4,051 | | Financing activities | $(60,097) | $(23,135) | | Net change | $(1,831) | $(6,884) | - Net cash provided by operating activities in fiscal 2025 was **$38.2 million**, primarily due to net income and favorable working capital changes, including a decrease in inventories and accounts receivable[192](index=192&type=chunk)[193](index=193&type=chunk) - Net cash provided by investing activities was **$20.0 million**, including **$29.2 million** in net proceeds from available-for-sale securities, partially offset by **$9.2 million** in capital expenditures[194](index=194&type=chunk) - Net cash used in financing activities was **$60.1 million**, including **$9.5 million** for share repurchases and **$49.5 million** to repay outstanding borrowings of the Term Loan[195](index=195&type=chunk) [Off-Balance Sheet Arrangements](index=46&type=section&id=Off-Balance%20Sheet%20Arrangements) The company did not have any off-balance sheet financing arrangements as of June 30, 2025 - The company did not have any off-balance sheet financing arrangements as of June 30, 2025[198](index=198&type=chunk) [Contractual Obligations](index=46&type=section&id=Contractual%20Obligations) As of June 30, 2025, the company had no long-term debt, but was committed to purchasing $2.8 million in engines and had repurchase obligations for dealer inventory, with unrecognized tax benefits not reflected - As of June 30, 2025, the company had no long-term debt obligations outstanding[199](index=199&type=chunk) - The company is committed to purchasing **$2.8 million** of engines as of June 30, 2025[199](index=199&type=chunk) - The company has repurchase obligations for dealer inventory, with no material impact from repurchase events during fiscal 2025, 2024, or 2023[200](index=200&type=chunk) - Unrecognized tax benefits are not reflected as the company cannot predict when open income tax years will close[201](index=201&type=chunk) [Critical Accounting Estimates](index=46&type=section&id=Critical%20Accounting%20Estimates) The company's critical accounting estimates involve significant judgment and include asset impairment (goodwill, other intangible assets, long-lived assets), product warranty liability, income taxes (effective rate, uncertain tax positions), and revenue recognition (dealer incentives, inventory repurchase obligations) [Asset Impairment](index=48&type=section&id=Asset%20Impairment) The company annually reviews goodwill and indefinite-lived intangible assets for impairment, using fair value calculations with significant judgment in forecasts and discount rates, and assesses long-lived assets if impairment indicators arise - Goodwill and indefinite-lived intangible assets are reviewed for impairment annually (June 30) or more frequently if indicators arise, using qualitative or quantitative assessments[204](index=204&type=chunk)[211](index=211&type=chunk) - Fair value calculations for reporting units and intangible assets use income and market approaches, with key judgments in future performance forecasts, growth rates, operating margins, and discount rates[206](index=206&type=chunk)[209](index=209&type=chunk) - As of June 30, 2025, the MasterCraft reporting unit had a goodwill balance of **$28.5 million**, with no impairment identified[120](index=120&type=chunk)[207](index=207&type=chunk)[365](index=365&type=chunk) - An interim impairment evaluation for Crest brand intangible assets (dealer network and trade name) during fiscal 2025 concluded no impairment[212](index=212&type=chunk)[319](index=319&type=chunk) - Long-lived assets are assessed for impairment if facts and circumstances suggest impairment, comparing book value to estimated future undiscounted cash flows[213](index=213&type=chunk) - During fiscal 2024, the company recognized **$6.9 million** in long-lived asset impairment charges related to its Aviara reporting unit, included in loss from discontinued operations[214](index=214&type=chunk) [Product Warranties](index=50&type=section&id=Product%20Warranties) The company accrues estimated product warranty costs as a liability upon revenue recognition, based on units sold, historical claim rates, and cost per claim, with periodic adjustments - The company offers warranties on products (generally 1-10 years) and a limited lifetime warranty on certain parts, accruing estimated costs as a liability at the time product revenue is recognized[216](index=216&type=chunk)[323](index=323&type=chunk) - Estimates for warranty liability are based on the number of units sold, historical and anticipated rates of warranty claims, and cost per claim, with periodic adjustments[216](index=216&type=chunk)[324](index=324&type=chunk) Accrued Warranty Liability Activity (Fiscal 2025 vs. 2024) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :--------------------------- | :-------------------------- | :-------------------------- | | Balance at the beginning of the period | $25,486 | $28,689 | | Provisions | $6,429 | $6,649 | | Payments made | $(8,614) | $(13,470) | | Changes for pre-existing warranties | $2,411 | $3,618 | | **Balance at the end of the period** | **$25,712** | **$25,486** | [Income Taxes](index=50&type=section&id=Income%20Taxes) Income tax expense involves significant judgment in evaluating uncertain tax positions and determining the provision, with the fiscal 2025 effective tax rate of 20.8% differing from the statutory rate due to various factors - Income tax expense includes current and deferred taxes, with significant judgment required in evaluating uncertain tax positions and determining the provision for income taxes[217](index=217&type=chunk)[218](index=218&type=chunk) - For fiscal 2025, the effective tax rate of **20.8%** differs from the statutory rate primarily due to state tax rates, uncertain tax positions, and tax credits[217](index=217&type=chunk)[384](index=384&type=chunk) [Revenue Recognition](index=50&type=section&id=Revenue%20Recognition) Revenue from boat, trailer, parts, and accessories sales to independent dealers is recognized upon transfer of control, net of estimated dealer incentives, and includes a liability for inventory repurchase obligations - Revenue is primarily derived from the sale of boats, trailers, marine parts, and accessories to independent dealers, recognized when control over promised goods is transferred to a customer[219](index=219&type=chunk) - Net sales are reduced by estimated dealer incentives, including wholesale rebates, retail rebates, promotions, floor plan reimbursement, or cash discounts[219](index=219&type=chunk)[220](index=220&type=chunk)[221](index=221&type=chunk) - The company accounts for inventory repurchase contingent obligations (triggered by dealer default) as guarantees, recognizing a liability based on the estimated fair value of the loss upon resale[222](index=222&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures about Market Risk](index=52&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company is primarily exposed to inflation and interest rate risks, which can cause fluctuations in operating results and cash flows. Volatility in raw material prices (resins, fiberglass, aluminum, lumber, steel) and components can increase operating costs and reduce profitability if not recouped - The company is primarily exposed to inflation and interest rate risks, which can cause fluctuations in the results of operations and cash flows[223](index=223&type=chunk) - Substantial increases in the prices of raw materials (resins, fiberglass, aluminum, lumber, steel) and components would increase operating costs and could reduce profitability if not recouped through higher product prices or improved operating efficiencies[224](index=224&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=52&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) The financial statements and supplementary financial information required for this item are presented in Part IV, Item 15 of this Form 10-K - The financial statements and supplementary financial information required under this Item 8 are presented in Part IV, Item 15 of this Form 10-K[225](index=225&type=chunk) [Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure](index=52&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with accountants on accounting and financial disclosure - There are no changes in and disagreements with accountants on accounting and financial disclosure[226](index=226&type=chunk) [Item 9A. Controls and Procedures](index=52&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025. They also assessed and concluded that internal control over financial reporting was effective based on the COSO framework. No material changes in internal control over financial reporting occurred during the period - The chief executive officer and chief financial officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2025[229](index=229&type=chunk) - Management assessed the effectiveness of internal control over financial reporting as of June 30, 2025, using the COSO framework and concluded it was effective[231](index=231&type=chunk) - There have been no changes in internal control over financial reporting during the period that have materially affected, or are reasonably likely to materially affect, internal control over financial reporting[233](index=233&type=chunk) [Item 9B. Other Information](index=54&type=section&id=Item%209B.%20Other%20Information) During the three months ended June 30, 2025, none of the company's directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - During the three months ended June 30, 2025, none of the company's directors or officers adopted, modified, or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements[234](index=234&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=54&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20That%20Prevent%20Inspections) This item is not applicable to the company - This item is not applicable[235](index=235&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance](index=55&type=section&id=Item%2010.%20Directors,%20Executive%20Officers%20and%20Corporate%20Governance) The information required for this item is incorporated by reference from the company's 2025 annual meeting of shareholders proxy statement - The information required by this Item 10 will be included in the Proxy Statement for the 2025 annual meeting of shareholders and is incorporated herein by reference[237](index=237&type=chunk) [Item 11. Executive Compensation](index=55&type=section&id=Item%2011.%20Executive%20Compensation) The information required for this item is incorporated by reference from the company's 2025 annual meeting of shareholders proxy statement - The information required by this Item 11 will be included in the Proxy Statement for the 2025 annual meeting of shareholders and is incorporated herein by reference[238](index=238&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=55&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) The information required for this item is incorporated by reference from the company's 2025 annual meeting of shareholders proxy statement - The information required by this Item 12 will be included in the Proxy Statement for the 2025 annual meeting of shareholders and is incorporated herein by reference[239](index=239&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=55&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence) The information required for this item is incorporated by reference from the company's 2025 annual meeting of shareholders proxy statement - The information required by this Item 13 will be included in the Proxy Statement for the 2025 annual meeting of shareholders and is incorporated herein by reference[240](index=240&type=chunk) [Item 14. Principal Accountant Fees and Services](index=55&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) The information required for this item is incorporated by reference from the company's 2025 annual meeting of shareholders proxy statement - The information required by this Item 14 will be included in the Proxy Statement for the 2025 annual meeting of shareholders and is incorporated herein by reference[241](index=241&type=chunk) PART IV [Item 15. Exhibits, Financial Statement Schedules](index=56&type=section&id=Item%2015.%20Exhibits,%20Financial%20Statement%20Schedules) This item lists the financial statements, financial statement schedules (omitted as not required or included elsewhere), and a comprehensive list of exhibits filed as part of or incorporated by reference into the Form 10-K [Financial Statements](index=62&type=section&id=Financial%20Statements) This section includes the audited consolidated financial statements of MasterCraft Boat Holdings, Inc. and subsidiaries for the fiscal years ended June 30, 2025, 2024, and 2023, along with the report of the independent registered public accounting firm, Deloitte & Touche LLP [Reports of Independent Registered Public Accounting Firm](index=62&type=section&id=Reports%20of%20Independent%20Registered%20Public%20Accounting%20Firm) Deloitte & Touche LLP issued unqualified opinions on the consolidated financial statements for fiscal years 2023-2025 and on the effectiveness of internal control over financial reporting as of June 30, 2025, highlighting accrued warranty liability and intangible asset impairment as critical audit matters - Deloitte & Touche LLP issued an unqualified opinion on the consolidated financial statements for the fiscal years ended June 30, 2025, 2024, and 2023[256](index=256&type=chunk) - An unqualified opinion was also expressed on the effectiveness of the company's internal control over financial reporting as of June 30, 2025[257](index=257&type=chunk)[271](index=271&type=chunk) - Critical audit matters included the accrued warranty liability for the MasterCraft and Pontoon segments and the impairment evaluation for the Crest definite and indefinite-lived intangible assets, due to significant management judgment in estimates[262](index=262&type=chunk)[266](index=266&type=chunk) [Consolidated Balance Sheets](index=67&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets decreased to $259.9 million from $318.0 million in 2024, primarily due to a significant reduction in total liabilities from the repayment of long-term debt Consolidated Balance Sheet Highlights (June 30, 2025 vs. 2024) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :------------------------------------------------------- | :-------------------------- | :-------------------------- | | Total Assets | $259,948 | $317,984 | | Current Assets | $121,213 | $155,074 | | Cash and cash equivalents | $28,926 | $7,394 | | Short-term investments | $50,518 | $78,846 | | Inventories, net | $30,469 | $36,972 | | Total Liabilities | $76,362 | $134,105 | | Long-term debt, net of unamortized debt issuance costs | — | $44,887 | | Total Equity | $183,586 | $183,879 | - Current assets associated with discontinued operations decreased from **$11.2 million** in 2024 to **zero** in 2025[279](index=279&type=chunk) - Total liabilities decreased significantly, primarily due to the repayment of long-term debt, which was **$44.9 million** in 2024 and **zero** in 2025[279](index=279&type=chunk) [Consolidated Statements of Operations](index=68&type=section&id=Consolidated%20Statements%20of%20Operations) In fiscal 2025, net sales decreased to $284.2 million from $322.4 million in 2024, leading to a net income of $7.0 million, down from $7.8 million, with diluted EPS from continuing operations at $0.65 Consolidated Statements of Operations (Fiscal 2025 vs. 2024 vs. 2023) | Metric | 2025 ($ thousands) | 2024 ($ thousands) | 2023 ($ thousands) | | :------------------------------------------------------- | :----------------- | :----------------- | :----------------- | | Net Sales | $284,203 | $322,351 | $609,903 | | Gross Profit | $56,865 | $71,610 | $168,739 | | Operating Income | $11,232 | $27,476 | $121,429 | | Income From Continuing Operations | $10,715 | $23,243 | $93,801 | | Loss From Discontinued Operations, Net of Tax | $(3,672) | $(15,443) | $(24,864) | | Net Income | $7,043 | $7,800 | $68,937 | | Diluted EPS (Continuing operations) | $0.65 | $1.36 | $5.28 | | Diluted EPS (Net income) | $0.43 | $0.46 | $3.88 | [Consolidated Statements of Equity](index=69&type=section&id=Consolidated%20Statements%20of%20Equity) As of June 30, 2025, total equity was $183.6 million, slightly down from $183.9 million in 2024, with net income and share-based compensation contributing to equity, offset by share repurchases Consolidated Statements of Equity Highlights (June 30, 2025 vs. 2024) | Metric | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :------------------------------------------------------- | :-------------------------- | :-------------------------- | | Common stock | $164 | $167 | | Additional paid-in capital | $52,559 | $59,892 | | Retained earnings | $130,663 | $123,620 | | MasterCraft Boat Holdings, Inc. equity | $183,386 | $183,679 | | Noncontrolling interest | $200 | $200 | | **Total equity** | **$183,586** | **$183,879** | - Net income of **$7.0 million** and share-based compensation activity of **$2.3 million** contributed to equity in fiscal 2025[285](index=285&type=chunk) - Repurchase and retirement of common stock reduced equity by **$9.6 million** in fiscal 2025[285](index=285&type=chunk) [Consolidated Statements of Cash Flows](index=70&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) In fiscal 2025, net cash provided by operating activities was $35.6 million, while investing activities provided $46.0 million, and financing activities used $60.1 million, resulting in a net increase of $21.5 million in cash and cash equivalents Consolidated Statements of Cash Flows (Fiscal 2025 vs. 2024 vs. 2023) | Activity | 2025 ($ thousands) | 2024 ($ thousands) | 2023 ($ thousands) | | :------------------------------------------------------- | :----------------- | :----------------- | :----------------- | | Net cash provided by operating activities | $35,593 | $12,497 | $134,196 | | Net cash provided by (used in) investing activities | $46,036 | $(1,785) | $(121,434) | | Net cash used in financing activities | $(60,097) | $(23,135) | $(27,148) | | Net change in cash and cash equivalents | $21,532 | $(12,423) | $(14,386) | | Cash and cash equivalents — End of Period | $28,926 | $7,394 | $19,817 | - Net cash provided by operating activities of continuing operations was **$38.2 million** in fiscal 2025, driven by net income and favorable working capital changes[192](index=192&type=chunk)[288](index=288&type=chunk) - Net cash provided by investing activities was **$46.0 million**, including **$25.9 million** from discontinued operations[288](index=288&type=chunk) - Net cash used in financing activities was **$60.1 million**, primarily for principal payments on long-term debt (**$49.5 million**) and share repurchases (**$9.8 million**)[288](index=288&type=chunk) [Notes to Consolidated Financial Statements](index=71&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed information on the company's significant accounting policies, including basis of presentation, discontinued operations (Aviara and NauticStar), revenue recognition, short-term investments, inventories, property, plant and equipment, goodwill and other intangible assets, accrued expenses, long-term debt, income taxes, share-based compensation, commitments and contingencies, earnings per share, and segment information. They also cover new accounting pronouncements [Note 1. Significant Accounting Policies](index=71&type=section&id=Note%201.%20Significant%20Accounting%20Policies) The consolidated financial statements adhere to U.S. GAAP, reporting Aviara and NauticStar as discontinued operations, recognizing revenue upon transfer of control, and expensing R&D as incurred, while also detailing impairment reviews for goodwill and intangible assets and product warranty accruals - The consolidated financial statements are prepared in accordance with U.S. GAAP and include MasterCraft Boat Holdings, Inc. and its wholly-owned subsidiaries[290](index=290&type=chunk) - The former Aviara and NauticStar businesses are reported as discontinued operations, with prior period amounts recast[292](index=292&type=chunk)[293](index=293&type=chunk) - Revenue is recognized when control over promised goods is transferred to a customer, typically upon release to the carrier, and is measured net of estimated dealer incentives[295](index=295&type=chunk) - Goodwill and indefinite-lived intangible assets (trade names) are not amortized but are reviewed for impairment annually; definite-lived intangible assets (dealer networks) are amortized over their estimated useful lives (approximately ten years)[309](index=309&type=chunk)[310](index=310&type=chunk)[317](index=317&type=chunk)[318](index=318&type=chunk) - Product warranty costs are estimated and recorded as a liability at the time product revenue is recognized, based on units sold, historical/anticipated claim rates, and cost per claim[323](index=323&type=chunk)[324](index=324&type=chunk) - Research and development expenditures are expensed as incurred, totaling **$6.5 million** for fiscal 2025[331](index=331&type=chunk) - The company adopted ASU No. 2023-07, Improvements to Reportable Segment Disclosures, for the fiscal year ended June 30, 2025[343](index=343&type=chunk) - The company is currently evaluating the impact of ASU No. 2023-09 (Income Tax Disclosures, effective fiscal 2026) and ASU No. 2024-03 (Expense Disaggregation Disclosures, effective fiscal 2028)[344](index=344&type=chunk)[345](index=345&type=chunk) [Note 2. Revenue Recognition](index=82&type=section&id=Note%202.%20Revenue%20Recognition) For fiscal 2025, total net sales were $284.2 million, with boats and trailers comprising the largest category, and international sales accounting for 11.4% of the total, while the top ten dealers represented approximately 34% of net sales Net Sales by Major Product Categories (Fiscal 2025) | Major Product Categories | MasterCraft ($ thousands) | Pontoon ($ thousands) | Total ($ thousands) | | :----------------------- | :------------------------ | :-------------------- | :------------------ | | Boats and trailers | $226,016 | $41,020 | $267,036 | | Parts | $11,704 | $1,692 | $13,396 | | Other revenue | $3,043 | $728 | $3,771 | | **Total** | **$240,763** | **$43,440** | **$284,203** | - For fiscal 2025, the company's top ten dealers accounted for approximately **34% of net sales**, with no single dealer accounting for more than **10%**[349](index=349&type=chunk) - International sales accounted for **11.4%** of the company's net sales for the year ended June 30, 2025[350](index=350&type=chunk) - As of June 30, 2025, contract liabilities totaled **$3.8 million**, with **$2.0 million** expected to be recognized as revenue during fiscal 2026[351](index=351&type=chunk) [Note 3. Discontinued Operations](index=82&type=section&id=Note%203.%20Discontinued%20Operations) The company completed the sale of its Aviara brand and manufacturing facility in fiscal 2025, resulting in a net gain on sale of $2.0 million, despite prior impairment charges of $9.8 million in fiscal 2024 - The company completed the sale of its Aviara brand and related assets on October 18, 2024, and the Aviara manufacturing facility on December 23, 2024[353](index=353&type=chunk) - The Aviara transactions resulted in a **$6.2 million gain** on the facility sale, partially offset by a **$4.2 million loss** related to the brand transaction, for a net gain on sale of discontinued operations of **$2.0 million** in fiscal 2025[354](index=354&type=chunk)[356](index=356&type=chunk) Loss from Discontinued Operations, Net of Tax | Fiscal Year | Amount ($ thousands) | | :---------- | :------------------- | | 2025 | $(3,672) | | 2024 | $(15,443) | | 2023 | $(24,864) | - In fiscal 2024, the Aviara reporting unit recognized total impairment charges of **$9.8 million** related to property, plant, equipment, inventory, and other assets due to a material reduction in expected future orders[357](index=357&type=chunk)[359](index=359&type=chunk) [Note 4. Short-Term Investments](index=85&type=section&id=Note%204.%20Short-Term%20Investments) The company invests excess cash in short-term debt securities, primarily corporate bonds and U.S. treasury bills, reclassifying held-to-maturity securities to available-for-sale during fiscal 2025 for debt repayment - The company invests excess cash balances in short-term debt securities, primarily investment-grade corporate bonds and U.S. treasury bills[360](index=360&type=chunk) - During the second quarter of fiscal 2025, held-to-maturity securities were reclassified to available-for-sale securities due to sales for debt repayment[360](index=360&type=chunk) Available-for-Sale Securities (June 30, 2025) | Type | Fair Value ($ thousands) | | :-------------------- | :----------------------- | | Corporate bonds | $45,232 | | U.S. treasury bills | $5,296 | | **Total** | **$50,528** | [Note 5. Inventories](index=85&type=section&id=Note%205.%20Inventories) Inventories are valued at the lower of cost or net realizable value using the FIFO method, totaling $30.5 million as of June 30, 2025, a decrease from $37.0 million in 2024 - Inventories are valued at the lower of cost or net realizable value and are determined based on the first-in, first-out (FIFO) method[308](index=308&type=chunk) Inventories, Net (June 30, 2025 vs. 2024) | Category | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :----------------------- | :-------------------------- | :-------------------------- | | Raw materials and supplies | $18,763 | $26,326 | | Work in process | $2,466 | $4,039 | | Finished goods | $11,219 | $8,707 | | Obsolescence reserve | $(1,979) | $(2,100) | | **Total inventories** | **$30,469** | **$36,972** | [Note 6. Property, Plant, and Equipment](index=86&type=section&id=Note%206.%20Property,%20Plant,%20and%20Equipment) Net property, plant, and equipment increased to $53.6 million as of June 30, 2025, from $52.3 million in 2024, with depreciation expense for fiscal 2025 totaling $7.8 million Property, Plant, and Equipment, Net (June 30, 2025 vs. 2024) | Category | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :------------------------ | :-------------------------- | :-------------------------- | | Land and improvements | $4,985 | $4,985 | | Buildings and improvements | $35,608 | $34,040 | | Machinery and equipment | $36,996 | $31,157 | | Furniture and fixtures | $6,114 | $5,498 | | Construction in progress | $11,904 | $10,295 | | Total property, plant, and equipment | $95,607 | $85,975 | | Less accumulated depreciation | $(42,031) | $(33,661) | | **Property, plant, and equipment — net** | **$53,576** | **$52,314** | - Depreciation expense for the year ended June 30, 2025, was **$7.8 million**[363](index=363&type=chunk) [Note 7. Goodwill and Other Intangible Assets](index=86&type=section&id=Note%207.%20Goodwill%20and%20Other%20Intangible%20Assets) As of June 30, 2025, the MasterCraft reporting unit had $28.5 million in goodwill with no impairment, and total other intangible assets, net, were $31.9 million, with amortization expense of $1.8 million for the year - As of June 30, 2025, the MasterCraft reporting unit had a goodwill balance of **$28.5 million**, with no impairment identified during the annual test[365](index=365&type=chunk) Other Intangible Assets, Net (June 30, 2025 vs. 2024) | Category | June 30, 2025 ($ thousands) | June 30, 2024 ($ thousands) | | :------------------------------------------------------- | :-------------------------- | :-------------------------- | | Amortized intangible assets (Dealer networks, Software) | $5,850 | $7,650 | | Unamortized intangible assets (Trade names) | $26,000 | $26,000 | | **Total other intangible assets, net** | **$31,850** | **$33,650** | - An interi

Core Insights - MasterCraft Boat Holdings, Inc. reported quarterly earnings of $0.4 per share, exceeding the Zacks Consensus Estimate of $0.18 per share, and showing a significant improvement from a loss of $0.04 per share a year ago, resulting in an earnings surprise of +122.22% [1] - The company achieved revenues of $79.52 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 12.21% and increasing from $67.18 million in the same quarter last year [2] Financial Performance - Over the last four quarters, MasterCraft has consistently surpassed consensus EPS estimates, achieving this four times [2] - The stock has gained approximately 9.6% since the beginning of the year, compared to the S&P 500's gain of 9.9% [3] Future Outlook - The company's earnings outlook will be crucial for investors, particularly in understanding how current consensus earnings expectations for upcoming quarters may evolve [4] - The current consensus EPS estimate for the next quarter is $0.26 on revenues of $75 million, and for the current fiscal year, it is $1.17 on revenues of $309.8 million [7] Industry Context - The Leisure and Recreation Products industry, to which MasterCraft belongs, is currently ranked in the bottom 23% of over 250 Zacks industries, indicating potential challenges ahead [8] - Another competitor in the industry, Malibu Boats, is expected to report quarterly earnings of $0.44 per share, reflecting a year-over-year change of +212.8%, with revenues projected at $195.8 million, up 23.4% from the previous year [9][10]

Financial Data and Key Metrics Changes - In Q4, net sales increased by $25 million or 46% year over year, reaching $79.5 million, driven by favorable mix, higher volumes, and lower dealer incentives [6][17] - Adjusted net income rose to $6.6 million or $0.40 per share, up from $0.04 per share last year [17] - For the full year, net sales were $284.2 million, a decrease of $38 million or 12% from the prior year, primarily due to planned reduction in unit sales volume [18] - Gross margin for the year was 20%, down from 22.2% in the prior year, attributed to lower cost absorption and price adjustments [18][19] - Adjusted EBITDA for the year was $24.4 million, compared to $40.2 million in the prior year, with an adjusted EBITDA margin of 8.6% [19] Business Line Data and Key Metrics Changes - The MasterCraft brand launched its flagship X Star product, establishing leadership in the ultra-premium ski wake category [10] - Belize, the premium pontoon brand, contributed modest incremental volume as production ramps up [10] - The company removed over 900 units from dealer inventories, strengthening dealer health [9] Market Data and Key Metrics Changes - Retail units in the markets are expected to decline by 5% to 10% in fiscal 2026 [12][22] - The company anticipates a cautious retail environment, with consumer sentiment remaining cautious due to macroeconomic uncertainties [8][12] Company Strategy and Development Direction - The company focuses on optimizing channel inventory, championing innovation, and positioning for the next upcycle [6] - Plans for fiscal 2026 include managing a range of demand scenarios and continuing to invest in product innovation and channel development [12][14] - The company aims to maintain a strong balance sheet while returning capital to shareholders through share repurchases [11][14] Management's Comments on Operating Environment and Future Outlook - Management acknowledges ongoing macroeconomic uncertainties, including elevated interest rates and a volatile trade environment [8][12] - Despite challenges, the company remains well-positioned for long-term growth, supported by a strong balance sheet and brand strength [14][24] - Management expects to generate positive free cash flow in fiscal 2026, underscoring the flexibility of their variable operating model [12][20] Other Important Information - The company generated $29 million of free cash flow during fiscal 2025 and ended the year with $79 million in cash and short-term investments, debt-free [11][20] - The company repurchased over 530,000 shares totaling $9.5 million in fiscal 2025, bringing cumulative repurchases to $74 million since the program's inception [20] Q&A Session Summary Question: Retail cadence throughout the quarter and Q1 expectations - Management noted a strong Q4 for MasterCraft but weaker for pontoons, maintaining the expectation of a 5% to 10% decline for the year [27][28] Question: Dealer terms and inventory levels - Management indicated that dealer inventories are healthier due to the removal of units, with destocking dependent on retail performance [29][30] Question: Consumer dynamics and tariff impacts - Management acknowledged the impact of tariffs on consumer sentiment but noted that the market is leaning premium, which benefits their brand [34][35] Question: Pricing strategies and affordability trends - Management discussed lowering prices on entry-level products to attract more buyers, while controlling costs to maintain flexibility [37][38] Question: Dealer network updates and wins - Management highlighted efforts to strengthen distribution and increase dealer density in key markets [39][40] Question: Industry dealer base health and inventory levels - Management reported improved dealer health and lower non-current inventories compared to the previous year, with a cautious outlook from dealers [64][67] Question: M&A strategy - Management emphasized a careful and selective approach to M&A, focusing on organic growth initiatives [70][71]

Financial Data and Key Metrics Changes - In Q4, net sales increased by $25 million or 46% year over year, reaching $79.5 million, driven by favorable mix, higher volumes, and lower dealer incentives [5][16] - Adjusted net income rose to $6.6 million or $0.40 per share, up from $0.04 per share last year [16] - For the full year, net sales were $284.2 million, a decrease of $38 million or 12% from the prior year, primarily due to planned reduction in unit sales volume [17] - Gross margin for the year was 20%, down from 22.2% in the prior year, attributed to lower cost absorption and price adjustments [18] - Adjusted net income for the year was $15.1 million or $0.92 per diluted share, compared to $28.9 million or $1.69 per share in the prior year [19] Business Line Data and Key Metrics Changes - The MasterCraft brand launched its flagship X Star product, establishing leadership in the ultra-premium ski wake category [8] - Belize, the premium pontoon brand, contributed modest incremental volume as production ramps up [9] - Free cash flow for fiscal 2025 was $29 million, allowing for debt repayment and share repurchase [10] Market Data and Key Metrics Changes - Retail units in markets are expected to decline by 5% to 10% in fiscal 2026 [11] - The company anticipates a cautious retail environment, with consumer sentiment remaining cautious due to macroeconomic uncertainties [6][12] Company Strategy and Development Direction - The company focuses on optimizing channel inventory, championing innovation, and positioning for the next up cycle [5] - Plans for fiscal 2026 include managing a range of demand scenarios and continuing to invest in product innovation and operational excellence [11][24] - The company aims to leverage favorable underlying secular trends in the industry, particularly in boating-friendly high-income states [12] Management's Comments on Operating Environment and Future Outlook - Management noted that the marine industry faced pressures from macroeconomic uncertainty, elevated interest rates, and a volatile trade environment [6] - Despite challenges, the company remains well-positioned for long-term growth, supported by a strong balance sheet and ongoing investment in innovation [13][20] - Management expects to generate positive free cash flow again in fiscal 2026, underscoring the flexibility of their variable operating model [11] Other Important Information - The company repurchased over 530,000 shares totaling $9.5 million in fiscal 2025, bringing cumulative repurchases to $74 million since the program's inception [20] - The impact of tariffs on fiscal 2025 results was marginal, with expectations to offset most direct costs with temporary price surcharges in fiscal 2026 [21] Q&A Session Summary Question: Retail cadence throughout the quarter and Q1 expectations - Management indicated that Q4 was strong for MasterCraft but weaker for the Pontoon side, maintaining the expectation of a 5% to 10% decline for the year [28][29] Question: Dealer terms and inventory levels - Management noted that dealer inventories are healthier due to the removal of over 900 units, with destocking in 2026 dependent on retail performance [30][31] Question: Consumer dynamics and tariff impacts - Management acknowledged the mixed consumer sentiment due to tariff headwinds but noted a lean towards premium products, which benefits their brand strength [34][35] Question: Pricing strategies and affordability trends - Management discussed the need for pricing flexibility and potential discounting to attract payment-sensitive buyers, especially in a high-interest rate environment [37][38] Question: Dealer network updates and wins - Management highlighted efforts to strengthen distribution and increase dealer density in key markets, with several successful dealer changes noted [40][41] Question: Industry dealer base health and inventory levels - Management reported improved dealer health and lower non-current inventories compared to the previous year, with a cautious outlook from dealers [66][68] Question: M&A strategy - The company remains selective and opportunistic regarding M&A, focusing on organic growth initiatives while maintaining a strong balance sheet [71][72]

FISCAL FOURTH QUARTER & 2025 RESULTS 1 Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward- looking statements generally relate to future events and include, without limitation, projections, forecasts and estimates about possible or assumed future results of the Company's business, financial condition, liquidity, results of operations, plans and objectives. In ...

Exhibit 99.1 Brad Nelson, Chief Executive Officer, commented, "MasterCraft executed well in fiscal 2025, successfully navigating a challenging economic and industry backdrop. In the face of low cycle volumes, we further strengthened dealer health, advanced our new product initiatives, and generated significant free cash flow. This enabled us to return nearly $10 million of capital to shareholders, underscoring our disciplined and value-enhancing approach to capital allocation." MasterCraft Boat Holdings, In ...

VONORE, Tenn., Aug. 27, 2025 (GLOBE NEWSWIRE) -- MasterCraft Boat Holdings, Inc. (NASDAQ: MCFT) today announced financial results for its fiscal 2025 fourth quarter and year ended June 30, 2025. The overview, commentary, and results provided herein relate to our continuing operations, which consists of our MasterCraft and Pontoon segments. Fourth Quarter Overview: Net sales for the fourth quarter were $79.5 million, up $25.2 million, or 46.4%, from the comparable prior-year periodIncome from continuing oper ...