UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: January 2, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-37502 MASTERCRAFT BOAT HOLDINGS, INC. (Exact name of registrant as specified in its charter) (State or Other Jurisdiction (I.R.S. Employe ...

FISCAL SECOND QUARTER 2022 RESULTS February 3, 2022 FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forwardlooking 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 obj ...

MasterCraft Boat Holdings, Inc. (NASDAQ:MCFT) Q2 2022 Earnings Conference Call February 3, 2022 8:30 AM ET Company Participants Tim Oxley - Chief Financial Officer Fred Brightbill - Chief Executive Officer & Chairman George Steinbarger - Chief Revenue Officer Conference Call Participants Kevin Condon - Baird Operator Good day, and welcome to the Second Quarter 2022 MasterCraft Boat Holdings Inc. Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentat ...

PART I FINANCIAL INFORMATION [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The company reports significant sales growth but modest net income increase due to higher costs and a goodwill impairment charge [Unaudited Condensed Consolidated Statements of Operations](index=4&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) Net sales grew 38.8% year-over-year, but higher costs and a goodwill impairment charge constrained net income growth to 8.6% Consolidated Statements of Operations Highlights (in thousands, except per share amounts) | Financial Metric | Three Months Ended Oct 3, 2021 | Three Months Ended Oct 4, 2020 | Change (%) | | :--- | :--- | :--- | :--- | | **NET SALES** | $144,010 | $103,745 | 38.8% | | **GROSS PROFIT** | $30,122 | $26,230 | 14.8% | | **OPERATING INCOME** | $14,044 | $13,404 | 4.8% | | **Goodwill impairment** | $1,100 | $0 | N/A | | **NET INCOME** | $10,386 | $9,567 | 8.6% | | **Diluted EPS** | $0.55 | $0.51 | 7.8% | [Unaudited Condensed Consolidated Balance Sheets](index=5&type=section&id=Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) Total assets increased slightly while liabilities decreased, driven by a significant shift from cash to inventory Consolidated Balance Sheet Highlights (in thousands) | Balance Sheet Item | October 3, 2021 | June 30, 2021 | | :--- | :--- | :--- | | Cash and cash equivalents | $11,651 | $39,252 | | Inventories, net | $75,536 | $53,481 | | Total current assets | $112,751 | $110,227 | | Goodwill | $28,493 | $29,593 | | **Total assets** | **$278,864** | **$276,460** | | Total current liabilities | $75,379 | $74,289 | | Long-term debt, net | $81,559 | $90,277 | | **Total liabilities** | **$161,471** | **$168,672** | | **Total stockholders' equity** | **$117,393** | **$107,788** | [Unaudited Condensed Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity grew by $9.6 million, primarily driven by net income and partially offset by stock repurchases - Total stockholders' equity increased by **$9.6 million** during the quarter, mainly due to net income of **$10.4 million**[18](index=18&type=chunk) - The company repurchased and retired **58,379 shares** of common stock for **$1.5 million**[18](index=18&type=chunk) [Unaudited Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Cash flow from operations turned negative due to a significant increase in inventory to manage supply chain risks Cash Flow Summary (in thousands) | Cash Flow Activity | Three Months Ended Oct 3, 2021 | Three Months Ended Oct 4, 2020 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(13,555) | $7,372 | | Net cash used in investing activities | $(3,618) | $(2,042) | | Net cash used in financing activities | $(10,428) | $(12,791) | | **NET CHANGE IN CASH** | **$(27,601)** | **$(7,461)** | - The negative operating cash flow was driven by a **$30.1 million** use of cash in operating assets and liabilities, primarily a significant increase in inventory[21](index=21&type=chunk) [Notes to Unaudited Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) Key notes detail a segment realignment, a goodwill impairment, increased inventory, and a new credit agreement - Beginning in Q1 fiscal 2022, the company realigned its reportable segments to **MasterCraft, Crest, NauticStar, and Aviara**[26](index=26&type=chunk)[58](index=58&type=chunk) - Inventories increased from **$53.5 million to $75.5 million**, with raw materials and work-in-process rising to support higher production and mitigate supply chain disruptions[35](index=35&type=chunk) - A goodwill impairment charge of **$1.1 million** was recognized for the Aviara reporting unit due to start-up inefficiencies and near-term operating losses[37](index=37&type=chunk)[38](index=38&type=chunk) - The company repurchased **58,379 shares** of common stock for **$1.5 million** under its **$50.0 million** stock repurchase program[57](index=57&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=17&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong sales driven by retail demand, offset by margin pressures from supply chain and inflation issues - Strong marine retail demand has led to historically low dealer inventory levels, driving a **38.8% increase** in the company's net sales[66](index=66&type=chunk) - Key operational challenges included **supply chain disruptions**, production inefficiencies leading to higher labor costs, and inflationary pressures on raw materials[67](index=67&type=chunk)[68](index=68&type=chunk)[69](index=69&type=chunk) - Gross margin declined by **440 basis points to 20.9%** compared to the prior year, primarily due to higher material and labor costs[75](index=75&type=chunk) - The company's liquidity remains strong, with **$11.7 million in cash** and **$74.3 million of available borrowing capacity**[103](index=103&type=chunk)[105](index=105&type=chunk) [Results of Operations](index=18&type=section&id=Results%20of%20Operations) Consolidated net sales rose 38.8% from higher unit volume, but operating income growth was limited by margin pressures Consolidated Unit Sales Volume by Segment | Segment | Q1 2022 Units | Q1 2021 Units | % Change | | :--- | :--- | :--- | :--- | | MasterCraft | 783 | 640 | 22.3% | | Crest | 716 | 453 | 58.1% | | NauticStar | 291 | 286 | 1.7% | | Aviara | 19 | 13 | 46.2% | | **Total** | **1,809** | **1,392** | **30.0%** | Consolidated Net Sales by Segment (in thousands) | Segment | Q1 2022 Sales | Q1 2021 Sales | % Change | | :--- | :--- | :--- | :--- | | MasterCraft | $92,015 | $69,591 | 32.2% | | Crest | $32,780 | $18,039 | 81.7% | | NauticStar | $13,360 | $12,342 | 8.2% | | Aviara | $5,855 | $3,773 | 55.2% | | **Total** | **$144,010** | **$103,745** | **38.8%** | - The Crest segment showed exceptional growth, with **net sales increasing 81.7%** and **operating income rising 128.6%** year-over-year[82](index=82&type=chunk)[83](index=83&type=chunk) - The Aviara segment's operating loss increased to **$3.6 million** from $1.0 million, driven by ramp-up inefficiencies and a goodwill impairment charge[89](index=89&type=chunk) [Non-GAAP Measures](index=21&type=section&id=Non-GAAP%20Measures) Adjusted EBITDA and Adjusted Net Income provide a clearer view of core operations, excluding certain non-recurring items Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Line Item | Three Months Ended Oct 3, 2021 | Three Months Ended Oct 4, 2020 | | :--- | :--- | :--- | | Net income | $10,386 | $9,567 | | EBITDA | $17,398 | $16,143 | | Goodwill impairment | $1,100 | - | | Share-based compensation | $896 | $640 | | Aviara transition costs | - | $178 | | **Adjusted EBITDA** | **$19,394** | **$16,961** | | **Adjusted EBITDA Margin** | **13.5%** | **16.3%** | Reconciliation of Net Income to Adjusted Net Income (in thousands) | Line Item | Three Months Ended Oct 3, 2021 | Three Months Ended Oct 4, 2020 | | :--- | :--- | :--- | | Net income | $10,386 | $9,567 | | Adjustments (Goodwill, Amortization, etc.) | $2,995 | $1,778 | | Adjusted Net Income before income taxes | $16,657 | $14,163 | | **Adjusted Net Income** | **$12,826** | **$10,906** | | **Diluted Adjusted Net Income per share** | **$0.67** | **$0.58** | [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) The company's cash position decreased due to inventory build-up, debt repayments, and stock repurchases - Cash and cash equivalents decreased by **$27.6 million to $11.7 million** as of October 3, 2021[103](index=103&type=chunk) - Working capital was significantly impacted by a **$22.1 million increase in inventory** to build safety stock and support higher production volumes[104](index=104&type=chunk)[110](index=110&type=chunk) - During the quarter, the company repurchased **58,379 shares for $1.5 million** under its authorized stock repurchase program[106](index=106&type=chunk)[111](index=111&type=chunk) - As of October 3, 2021, the company had **$84.4 million in total debt** and **$74.3 million of available borrowing capacity**[103](index=103&type=chunk)[105](index=105&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=25&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reports no material changes in its market risk profile since the last annual report - There have been **no material changes** in market risk from those disclosed in the 2021 Annual Report[116](index=116&type=chunk) [Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes in internal controls - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of October 3, 2021[119](index=119&type=chunk) - **No changes occurred** during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[120](index=120&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=27&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material legal proceedings for the period - None[122](index=122&type=chunk) [Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were reported since the last annual filing - **No material changes** to risk factors were reported during the three months ended October 3, 2021[123](index=123&type=chunk) [Unregistered Sales of Securities and Use of Proceeds](index=27&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Securities%20and%20Use%20of%20Proceeds) The company repurchased $1.5 million of common stock under its authorized $50.0 million program - The company has a **$50.0 million stock repurchase program** authorized through June 24, 2024[124](index=124&type=chunk) Common Stock Repurchases (Q1 2022) | Period | Total Shares Purchased | Average Price Paid Per Share | Approx. Value Remaining (thousands) | | :--- | :--- | :--- | :--- | | Aug 30 - Oct 3, 2021 | 58,379 | $25.45 | $48,513 | [Exhibits, Financial Statement Schedules](index=28&type=section&id=Item%206.%20Exhibits,%20Financial%20Statement%20Schedules) This section lists all exhibits filed with the report, including required certifications and XBRL data - The report includes standard exhibits such as **CEO/CFO certifications** (31.1, 31.2, 32.1, 32.2) and Inline XBRL documents[130](index=130&type=chunk)

Financial Data and Key Metrics Changes - The company achieved record net sales of $144 million for Q1 2022, an increase of $40.3 million or 38.8% compared to $103.7 million in the prior year [41] - Gross profit increased by $3.9 million to $30.1 million, driven by higher sales volume and price increases, despite higher material and labor costs [42] - Adjusted net income rose to a record $12.8 million or $0.67 per diluted share, compared to $10.9 million or $0.58 per diluted share in the prior year [46] - Adjusted EBITDA reached a record $19.4 million, with an adjusted EBITDA margin of 13.5%, down 290 basis points from the prior year [47] Business Line Data and Key Metrics Changes - MasterCraft brand net sales reached a first-quarter record of $92 million, with a 22% increase in year-over-year shipments [23] - Crest set a record for net sales, increasing by 82% year-over-year, primarily driven by a 58% increase in units [30] - Aviara's net sales increased by over 55%, driven by a 48% increase in units, despite production challenges [32] Market Data and Key Metrics Changes - Dealer inventories were estimated to be under inventoried by more than 2,500 units, with half of the shortfall attributed to MasterCraft [12] - Average dealer inventories across all brands were down approximately 30% compared to the first quarter of fiscal 2021 [12] - The proportion of new-to-boating consumers increased by more than 40% at MasterCraft compared to Q1 2021 [14] Company Strategy and Development Direction - The company is committed to aggressive long-term growth plans, pursuing targeted capital projects to ramp up production capacity by an additional 20% to 25% [19] - The strategic focus is on consumer experience, digital marketing, operational excellence, and human capital development [22] - The company plans to maintain a limited promotional environment, emphasizing superior product offerings rather than promotional pricing [22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sustained consumer demand for boating, driven by demographic trends and lifestyle changes accelerated by the COVID pandemic [13] - The company anticipates that dealer inventories will not reach optimal levels until fiscal year 2024, providing confidence in wholesale growth visibility [17] - Management acknowledged supply chain disruptions as a significant constraint on production and unit shipments, impacting margins [10][29] Other Important Information - The company ended the quarter with nearly $86 million in total liquidity and reduced outstanding debt by nearly $9 million [48][49] - A new $50 million share repurchase program was authorized, with approximately $1.5 million spent during the quarter [50] - Full-year fiscal 2022 guidance was raised, expecting consolidated net sales growth in the 20% range and adjusted EBITDA margins in the 18% range [52] Q&A Session Summary Question: About preorders and retail presold units - Management indicated that the majority of orders scheduled are already retail sold, with an increasing percentage since the last quarter, providing confidence in the pipeline [59] Question: Managing dealer allocation process - The allocation process is based on dealer inventory levels and retail sold percentages, prioritizing consumer orders to ensure timely delivery [60][61] Question: Expectations for inventory normalization - Management is focused on building inventory during the off-season, contingent on supply chain behavior, with expectations to improve dealer inventory by next summer [76]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to MASTERCRAFT BOAT HOLDINGS, INC. (Exact name of registrant as specified in its charter) (State or Other Jurisdiction (Commission (I.R.S. Employer of Incorporation or Organizat ...

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Washington, D.C. 20549 FORM 10-Q ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended: April 4, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-37502 MASTERCRAFT BOAT HOLDINGS, INC. (Exact name of registrant as specified in its charter) UNITED STATES SECURITIES AND EXCHANGE COMMISSION (State or Other Jurisdiction (I.R.S. Employer ...