OneWater(US:ONEW)2023-08-04 20:45Financial Performance - Total revenues for the three months ended June 30, 2023, were $594.3 million, a 4.3% increase from $568.9 million in the same period of 2022[17] - Net income attributable to OneWater Marine Inc. for the three months ended June 30, 2023, was $28.6 million, compared to $56.0 million in the same period of 2022, reflecting a decrease of 48.9%[17] - Earnings per share (EPS) for Class A common stock was $2.00 for the three months ended June 30, 2023, down from $3.96 in the prior year[17] - Net income for the three months ended June 30, 2023, was $33,290,000, a decrease from $64,483,000 in the same period of 2022, representing a decline of approximately 48.3%[19] - Comprehensive income attributable to One Water Holdings, Inc. for the three months ended June 30, 2023, was $28,566,000, down from $55,977,000 in the prior year, reflecting a decrease of about 48.9%[19] - For the nine months ended June 30, 2023, net income totaled $71,755,000, compared to $130,323,000 for the same period in 2022, indicating a decline of approximately 45%[19] - The total comprehensive income for the nine months ended June 30, 2023, was $71,770,000, down from $130,323,000 in the same period of 2022, reflecting a decrease of approximately 44.9%[19] - Net income for the nine months ended June 30, 2023, was $71.755 million, a decrease of 44.9% compared to $130.323 million in the same period of 2022[23] - Adjusted EBITDA for the three months ended June 30, 2023, was $59.8 million, down from $95.1 million for the same period in 2022, reflecting a decrease of approximately 37.1%[202] - For the nine months ended June 30, 2023, Adjusted EBITDA was $139.4 million, compared to $202.2 million for the same period in 2022, representing a decline of about 30.9%[203] Revenue Breakdown - New boat sales generated $371.6 million, slightly down from $376.9 million year-over-year, while pre-owned boat sales increased to $111.5 million from $98.2 million[17] - Sales of new boats from the company's top ten brands accounted for approximately 40.2% of total sales for the nine months ended June 30, 2023, down from 42.9% in 2022[30] - Non-boat sales contributed 18.7% to revenue in Q3 2023, up from 16.5% in Q3 2022, and accounted for 36.5% of gross profit in Q3 2023, compared to 28.4% in Q3 2022[139] - The Dealerships segment generated approximately 91% of total revenues for the three and nine months ended June 30, 2023, with revenue of $543.3 million and $1.348 billion, respectively[127] - The Distribution segment accounted for approximately 9% of total revenues, reporting $51.2 million for the three months and $137.0 million for the nine months ended June 30, 2023[128] Expenses and Liabilities - Total liabilities rose to $1.25 billion as of June 30, 2023, compared to $1.05 billion as of September 30, 2022, indicating a 18.5% increase[16] - Selling, general and administrative expenses increased by $5.0 million, or 5.7%, to $92.8 million, remaining flat as a percentage of revenue at 15.6%[165] - Interest expense related to floor plans surged by $6.3 million, or 557.5%, to $7.4 million, primarily due to increased average inventory and rising interest rates[170] - Interest expense related to floor plans increased by $14.6 million, or 478.8%, to $17.7 million for the nine months ended June 30, 2023, due to higher average inventory and interest rates[193] Assets and Inventory - Total current assets increased to $808.5 million as of June 30, 2023, from $566.9 million as of September 30, 2022, representing a 42.6% growth[16] - The company reported a significant increase in inventories, which rose to $572.9 million from $373.0 million year-over-year, a 53.4% increase[16] - Accounts receivable increased to $94.8 million as of June 30, 2023, compared to $59.1 million as of September 30, 2022, driven by a rise in contracts in transit[67] - The outstanding balance of the Inventory Financing Facility was $444.8 million as of June 30, 2023, compared to $267.1 million as of September 30, 2022[71] Acquisitions and Growth Strategy - The company plans to continue its acquisition strategy, aiming to integrate operations and realize synergies from recent acquisitions[10] - The company completed acquisitions of Taylor Marine Centers and Harbor View Marine for a total consideration of $41.8 million, contributing $20.5 million to consolidated revenue for the three months ended June 30, 2023[60][63] - The company has acquired a total of 79 additional dealerships and 12 distribution centers/warehouses since its formation in 2014, significantly expanding its market presence[129] - The company has strategically acquired 12 distribution centers and warehouses through 5 parts and accessories companies to diversify its growth strategy[132] Market Conditions and Outlook - Future outlook remains cautious due to economic uncertainties, including inflation and consumer demand fluctuations[10] - The company noted that its business is highly seasonal, with lower sales typically occurring in the December and March quarters, except in Florida[204] - The company anticipates adequate cash flow from operations and borrowings to fund current operations and acquisitions for the next twelve months[206] Compliance and Financial Health - The Company was in compliance with all financial and non-financial covenants related to its financing facilities as of June 30, 2023[73] - Cash needs for acquisitions have historically been financed through Credit Facilities and cash generated from operations, with compliance to covenants being crucial[207] - The company has not recognized any uncertain tax positions as of June 30, 2023, indicating management's confidence in its tax positions[106]