OneWater(ONEW) - 2025 Q3 - Quarterly Results

Fiscal Third Quarter 2025 Earnings Announcement OneWater Marine Inc. announced its fiscal third quarter 2025 results, highlighting its ability to outperform industry trends despite macroeconomic uncertainty and competitive pressures Executive Summary and Highlights OneWater Marine Inc. reported strong fiscal third quarter 2025 results, outperforming industry trends with increased revenue and strategic inventory management CEO Commentary CEO Austin Singleton highlighted the company's strong performance against industry trends, emphasizing customer service, strategy, and disciplined inventory management - CEO Austin Singleton noted the company's outperformance against broader industry trends despite macroeconomic uncertainty and competitive margin pressures[3] - The company remains focused on customer service, strategy execution, market share gains, and disciplined inventory management, including strategic brand exits[3] Key Financial Highlights Key financial metrics for Q3 FY2025 include $553 million in revenue, a 2% increase in same-store sales, and $33 million in Adjusted EBITDA Fiscal Third Quarter 2025 Key Financial Highlights | Metric | Value | | :--- | :--- | | Revenue | $553 million | | Same-store sales | 2% increase | | Gross profit margin | 23.3% | | GAAP net income | $11 million | | GAAP diluted EPS | $0.65 | | Adjusted diluted EPS | $0.79 | | Adjusted EBITDA | $33 million | Fiscal Third Quarter 2025 Financial Performance OneWater Marine's Q3 FY2025 financial performance showed a 1.9% revenue increase driven by pre-owned boat sales, alongside declines in profitability and a 13.6% reduction in total inventory Revenue Breakdown Total revenues increased by 1.9% to $552.9 million, primarily driven by a 17.8% surge in pre-owned boat sales, offsetting a slight decline in new boat revenue Q3 FY2025 Revenue by Category (vs. Q3 FY2024) | Revenue Category | 2025 ($ in thousands) | 2024 ($ in thousands) | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | New boat | $326,134 | $333,162 | $(7,028) | (2.1)% | | Pre-owned boat | $125,941 | $106,889 | $19,052 | 17.8% | | Finance & insurance income | $17,782 | $17,932 | $(150) | (0.8)% | | Service, parts & other | $83,007 | $84,458 | $(1,451) | (1.7)% | | Total revenues | $552,864 | $542,441 | $10,423 | 1.9% | - Total revenues increased by 1.9% to $552.9 million, with same-store sales up 2%[4] - New boat revenue decreased 2.1% due to fewer units sold, partially offset by higher average prices. Pre-owned boat revenue surged 17.8% from increased units and average prices[4] - Service, parts & other sales decreased 1.7% due to lower distribution segment sales, despite an increase in dealership service sales[4] Profitability Metrics Gross profit margin declined by 110 basis points to 23.3%, while SG&A expenses increased to 16.7% of revenue, impacting net income and Adjusted EBITDA Q3 FY2025 Profitability Overview (vs. Q3 FY2024) | Metric | 2025 ($ in millions) | 2024 ($ in millions) | Change | | :--- | :--- | :--- | :--- | | Gross profit | $128.7 | $132.6 | $(3.9) million | | Gross profit margin | 23.3% | 24.4% | (110) bps | | SG&A expenses | $92.1 | $87.1 | $5.0 million | | SG&A as % of revenue | 16.7% | 16.0% | 70 bps | | Net income | $10.7 | $16.7 | $(6.0) million | | Diluted EPS | $0.65 | $0.99 | $(0.34) | | Adjusted diluted EPS | $0.79 | $1.05 | $(0.26) | | Adjusted EBITDA | $32.8 | $39.2 | $(6.4) million | - Gross profit margin decreased by 110 basis points to 23.3%, attributed to new boat model mix, pricing strategies, and the impact of exiting select brands[5] - Selling, general and administrative expenses increased to 16.7% of revenue, up from 16.0%, due to efforts to drive same-store sales and inflationary costs[6] Balance Sheet and Liquidity The company improved its liquidity position with cash increasing to $70.1 million and total inventory decreasing by 13.6% to $517.1 million Key Balance Sheet and Liquidity Metrics (as of June 30, 2025 vs. 2024) | Metric | June 30, 2025 ($ in millions) | June 30, 2024 ($ in millions) | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $70.1 | $41.0 | $29.1 million | | Total liquidity | >$85.0 | N/A | N/A | | Total inventory | $517.1 | $598.6 | $(81.5) million (-13.6%) | | Total long-term debt | $419.5 | N/A | N/A | | Adjusted long-term net debt | $349.3 | N/A | N/A | | Pro forma adjusted net debt leverage ratio | 5.8x | N/A | N/A | - Total inventory decreased by 13.6% to $517.1 million, reflecting the company's inventory management strategy[8] Fiscal Year 2025 Outlook OneWater Marine updated its FY2025 guidance, projecting revenue between $1.80 billion and $1.85 billion, with Adjusted EBITDA of $65 million to $80 million Fiscal Full Year 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | Revenue | $1.80 billion to $1.85 billion | | Dealership same-store sales | Up low single digits | | Adjusted EBITDA | $65 million to $80 million | | Adjusted Diluted EPS | $0.50 to $0.75 | Condensed Consolidated Financial Statements This section provides unaudited condensed consolidated statements of operations and balance sheets, detailing GAAP financial performance and position for Q3 and YTD FY2025 Condensed Consolidated Statements of Operations The unaudited condensed consolidated statements of operations detail revenues, gross profit, income from operations, and net income for the three and nine months ended June 30, 2025 and 2024 Condensed Consolidated Statements of Operations (Unaudited, in thousands) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Total revenues | $552,864 | $542,441 | $1,412,199 | $1,394,775 | | Total gross profit | $128,663 | $132,605 | $323,128 | $344,410 | | Income from operations | $30,379 | $39,999 | $44,677 | $60,325 | | Net income (loss) | $10,715 | $16,714 | $(3,272) | $4,235 | | Net income (loss) attributable to OneWater Marine Inc. | $10,715 | $14,683 | $(1,624) | $3,544 | | Diluted EPS | $0.65 | $0.99 | $(0.10) | $0.24 | Condensed Consolidated Balance Sheet The unaudited condensed consolidated balance sheet provides a snapshot of assets, liabilities, and equity as of June 30, 2025 and 2024, highlighting changes in cash and inventory Condensed Consolidated Balance Sheet (Unaudited, in thousands) | Asset/Liability/Equity | June 30, 2025 (in thousands) | June 30, 2024 (in thousands) | | :--- | :--- | :--- | | Cash | $70,146 | $41,034 | | Inventories | $517,093 | $598,567 | | Total current assets | $739,962 | $821,996 | | Total assets | $1,540,429 | $1,635,880 | | Notes payable – floor plan | $435,777 | $486,547 | | Total current liabilities | $603,331 | $638,934 | | Long-term debt, net | $381,497 | $417,599 | | Total liabilities | $1,147,200 | $1,235,531 | | Total stockholders' equity attributable to OneWater Marine Inc. | $393,229 | $368,641 | | Total stockholders' equity | $393,229 | $400,349 | Reconciliation of Non-GAAP Financial Measures This section reconciles GAAP to non-GAAP financial measures, such as Adjusted Net Income, Adjusted Diluted EPS, and Adjusted EBITDA, used by management to evaluate operating performance Adjusted Net Income and Diluted EPS Reconciliation This reconciliation details the adjustments from GAAP net income and diluted EPS to their adjusted non-GAAP counterparts for the three and nine months ended June 30, 2025 and 2024 Adjusted Net Income and Diluted EPS Reconciliation (Unaudited, in thousands except per share data) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Nine Months Ended June 30, 2025 (in thousands) | Nine Months Ended June 30, 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) attributable to OneWater Marine Inc. | $10,715 | $14,683 | $(1,624) | $3,544 | | Adjusted net income attributable to OneWater Marine Inc. | $13,017 | $15,513 | $7,075 | $19,914 | | Net earnings (loss) per share of Class A common stock - diluted | $0.65 | $0.99 | $(0.10) | $0.24 | | Adjusted earnings per share of Class A common stock - diluted | $0.79 | $1.05 | $0.45 | $1.35 | Adjusted EBITDA and Net Debt Reconciliation This reconciliation provides a detailed breakdown of Adjusted EBITDA for the three months and trailing twelve months, along with the calculation of Adjusted Long-Term Net Debt Adjusted EBITDA and Net Debt Reconciliation (Unaudited, in thousands except ratios) | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Trailing twelve months ended June 30, 2025 (in thousands) | | :--- | :--- | :--- | :--- | | Net income (loss) | $10,715 | $16,714 | $(13,683) | | Adjusted EBITDA | $32,845 | $39,206 | $60,457 | | Long-term debt (including current portion) | N/A | N/A | $419,467 | | Less: cash | N/A | N/A | $(70,146) | | Adjusted long-term net debt | N/A | N/A | $349,321 | | Pro forma adjusted net debt leverage ratio | N/A | N/A | 5.8x | About OneWater Marine Inc. OneWater Marine Inc. is a leading U.S. premium marine retailer with 97 locations across 19 states, offering diverse products and services including boat sales and maintenance - OneWater Marine Inc. is one of the largest and fastest-growing premium marine retailers in the United States[22] - The company operates 97 retail locations, 9 distribution centers/warehouses, and multiple online marketplaces in 19 states[22] - Revenue streams are diversified, including sales of new and pre-owned boats, finance & insurance products, parts & accessories, and maintenance/repair services[22] Non-GAAP Financial Measures and Key Performance Indicators Definitions This section defines OneWater Marine's non-GAAP financial measures and key performance indicators, such as Adjusted EBITDA and Same-Store Sales, explaining their calculation and management's rationale Adjusted EBITDA Definition Adjusted EBITDA is defined as net income adjusted for various non-cash and non-recurring items, used by management to compare operating performance consistently - Adjusted EBITDA is defined as net income (loss) before interest expense – other, income tax (benefit) expense, depreciation and amortization, and other (income) expense, further adjusted for items like change in fair value of contingent consideration, restructuring and impairment, stock-based compensation, and transaction costs[24] - Management uses Adjusted EBITDA to compare operating performance consistently across periods by removing effects of capital structure, asset base, and other non-core items[25] Adjusted Net Income and Diluted EPS Definition Adjusted Net Income and Diluted EPS are non-GAAP metrics that adjust for specific items to provide a clearer view of the company's core financial performance - Adjusted Net Income Attributable to OneWater Marine Inc. is Net Income Attributable to OneWater Marine Inc. adjusted for transaction costs, intangible amortization, change in fair value of contingent consideration, restructuring and impairment, and other expense (income), with allocations to non-controlling interest and income tax adjustments[26] - Adjusted Diluted Earnings Per Share applies these adjustments on a per-share basis[26] - These metrics are used to assess financial performance by removing the effects of unusual or one-time charges and other items impacting comparability[27] Adjusted Long-Term Net Debt Definition Adjusted Long-Term Net Debt, calculated as long-term debt less cash, serves as an indicator of financial leverage, especially when compared to Adjusted EBITDA - Adjusted Long-Term Net Debt is defined as long-term debt (including current portion) less cash[28] - It is considered an indicator of financial leverage, especially when divided by trailing twelve-month Adjusted EBITDA[28] Same-Store Sales Definition Same-store sales, excluding new and acquired stores, measure the organic growth of the Dealership segment and are a key indicator of comparative financial results - Same-store sales are defined as sales from the Dealership segment, excluding new and acquired stores[29] - New and acquired stores are included in the comparable store base after 13 months of operation under company ownership, with revenues included for identical months[29] - This metric is used to assess the organic growth of Dealership segment revenue and is considered an important indicator of comparative financial results[29] Cautionary Statement Concerning Forward-Looking Statements This section cautions that forward-looking statements are subject to inherent uncertainties and risks, which could cause actual results to differ materially from expectations - The document contains forward-looking statements regarding strategy, future operations, financial position, and guidance, which are not guarantees of future performance[30] - Key risks include changes in demand, industry seasonality and volatility, supply chain challenges, inflation, interest rate fluctuations, adverse weather, acquisition strategies, compliance with credit covenants, cash flow, global public health concerns, and geopolitical risks[31] - The company undertakes no obligation to update or revise any forward-looking statements, except as required by law[31] Conference Call and Webcast Details OneWater Marine will host a conference call and webcast on July 31st at 8:30 am ET to discuss Q3 earnings, with a replay available until August 7th, 2025 - A conference call to discuss fiscal third quarter earnings will be held on Thursday, July 31st, at 8:30 am Eastern time[10] - Access is available via phone (+1 646 564 2877 or +1 800 549 8228) or a live webcast on the company's investor relations website (https://investor.onewatermarine.com/)[10](index=10&type=chunk)[11] - A telephonic replay will be available through August 7th, 2025, using specific dial-in numbers and access code **25911 **[12] Investor Contact Information For investor or media inquiries, contact Jack Ezzell, Chief Financial Officer, at IR@OneWaterMarine.com - Investor or media contact: Jack Ezzell, Chief Financial Officer, IR@OneWaterMarine.com[32]