Core Viewpoint - MasterCraft Boat Holdings, Inc. has announced a definitive agreement to combine with Marine Products Corporation, enhancing its marine platform through complementary brands and an expanded dealer network [1][14][20] Financial Performance - In Q2, net sales increased by $8.4 million or 13% year-over-year, reaching $71.8 million, driven by favorable model mix, higher volumes, and pricing [4][10] - Adjusted EBITDA rose to $7.5 million, compared to $3.5 million in the prior year, with an adjusted EBITDA margin improvement of 480 basis points to 10.4% [11][12] - The company raised its full-year guidance for net sales, earnings, and adjusted earnings per share, expecting consolidated net sales between $300 million and $310 million for fiscal 2026 [5][12] Product Development and Innovation - MasterCraft is focusing on innovation with new product launches, including the redesigned X24 and Xstar, which have generated strong demand signals [6][7] - The combination with Marine Products is expected to enhance product development capabilities and accelerate the launch of new models [14][17] Strategic Benefits of the Combination - The merger will create a stronger, diversified marine platform with a combined dealer network of over 500 dealers globally, improving market entry efficiency [16][20] - The transaction is expected to deliver approximately $6 million in annual cost savings by eliminating Marine Products' public company costs and corporate overhead [24] - The combined company will maintain distinct brand identities while expanding product offerings across various price points and boat lengths [15][18] Market Opportunities - The merger allows MasterCraft to access a broader market, including recreational and sport fishing segments, with an estimated addressable market of $12 billion [50][58] - The integration is projected to unlock additional revenue and cost synergies through shared innovation platforms and operational efficiencies [25][29] Transaction Details - Marine Products Corporation shareholders will receive 0.232 shares of MasterCraft stock and $2.43 in cash per share, totaling $86 million in cash consideration [20][21] - The transaction has been unanimously approved by the boards of both companies and is expected to close in calendar 2026, subject to regulatory approvals [21][22]

Financial Data and Key Metrics Changes - Q2 net sales increased by $8.4 million or 13% year-over-year, reaching $71.8 million [7][13] - Adjusted EBITDA rose nearly $4 million, with an adjusted EBITDA margin improvement of approximately 480 basis points to 10.4% [7][15] - Adjusted net income for the quarter was $4.7 million, or $0.29 per diluted share, compared to $1.7 million, or $0.10 per share in the prior year [14] - Full-year guidance for consolidated net sales is now expected to be between $300 million and $310 million, with adjusted EBITDA between $36 million and $39 million [15][16] Business Line Data and Key Metrics Changes - The MasterCraft segment is experiencing momentum with new premium products and strong demand signals from boat shows [9][10] - The pontoon segment is focused on operational improvements and enhancing margin performance, with the luxury brand Balise launching the new Halo model [11][12] Market Data and Key Metrics Changes - Retail demand is expected to be down 5%-10%, but recent trends are tracking toward the better end of that range for the MasterCraft segment [8] - Early boat show results have shown strong engagement, particularly in several key cities [10] Company Strategy and Development Direction - The company announced a definitive agreement to combine with Marine Products Corporation, aiming to strengthen its marine platform through complementary brands and expanded dealer networks [6][18] - The combination is expected to unlock growth opportunities and enhance operational efficiencies, with a focus on maintaining brand identities and quality [20][21] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current momentum and the ability to navigate the dynamic market environment [19] - The company is committed to disciplined production management and capital allocation strategies focused on value creation [19][28] Other Important Information - The transaction with Marine Products Corporation is expected to close in Q2 2026, subject to regulatory approvals [26] - The combined company will maintain a strong balance sheet with no debt and significant liquidity post-transaction [27] Q&A Session Summary Question: Can you elaborate on the additional synergies from the transaction? - Management highlighted opportunities in innovation platforms, manufacturing best practices, and expanded distribution as key areas for synergies [31][34] Question: What is the current state of inventory management? - Management indicated that restocking is largely over, and both companies are in good shape regarding inventory levels [35][36] Question: How did the pricing for the transaction come about? - Management explained that the mix of cash and stock was appealing to Marine Products, allowing them to participate in the upside of the combined entity [39][41] Question: What are the expectations for shifts in Marine Products' model mix post-integration? - Management noted that there are plans to enhance the model mix and accelerate innovation, leveraging the strengths of both companies [49][50] Question: How will the combined dealer network expand distribution? - Management acknowledged that while there are opportunities for cross-synergy, it will be market-specific and will require careful planning [51][82] Question: What is the outlook for the Balise brand post-transaction? - Management confirmed that the Balise brand will continue to expand, with strong consumer interest and dealer feedback [84][86]

Financial Data and Key Metrics Changes - Q2 net sales increased by $8.4 million or 13% year-over-year, reaching $71.8 million [7][13] - Adjusted EBITDA rose by nearly $4 million, with an adjusted EBITDA margin improvement of approximately 480 basis points to 10.4% [7][15] - Adjusted net income for the quarter was $4.7 million, or $0.29 per diluted share, compared to $1.7 million, or $0.10 per share in the prior year [14] - Full-year guidance for consolidated net sales is now expected to be between $300 million and $310 million, with adjusted EBITDA between $36 million and $39 million [15][16] Business Line Data and Key Metrics Changes - Within the MasterCraft segment, there is growing momentum with the introduction of new premium products, including the redesigned X24 and XStar, which are generating strong demand signals [9][10] - The pontoon segment is executing operational improvements and enhancing margin performance, with the luxury brand Balise launching the new Halo model [11][12] Market Data and Key Metrics Changes - Retail demand is expected to be down 5%-10%, but recent trends are tracking toward the better end of that range for the MasterCraft segment [8] - Early boat show results have been encouraging, with strong engagement reported at several key shows [10] Company Strategy and Development Direction - The company announced a definitive agreement to combine with Marine Products Corporation, aiming to strengthen its marine platform through complementary brands and an expanded dealer network [6][18] - The combination is expected to unlock growth opportunities and enhance product development and manufacturing capabilities [18][20] - The focus remains on maintaining brand identities while expanding the product lineup across various price points and boat lengths [20][23] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current momentum and the ability to navigate the dynamic market environment through disciplined inventory and production management [19] - The company is confident that the combination with Marine Products Corporation will create significant value and growth opportunities [18][28] Other Important Information - The transaction is expected to close in Q2 2026, subject to regulatory approvals and shareholder approval [26] - The combined company will maintain a strong balance sheet with no debt and significant liquidity post-transaction [27] Q&A Session Summary Question: Can you elaborate on the additional synergies from the transaction? - Management highlighted opportunities in innovation platforms, manufacturing best practices, and expanded distribution as key areas for synergies [31][34] Question: What is the current state of inventory management? - Management indicated that restocking is largely over, and both companies are in good shape regarding inventory levels [35][36] Question: How did the acquisition price compare to Marine Products' closing price? - Management explained that the mix of cash and stock was appealing to Marine Products, allowing them to participate in the upside of the combined entity [39][41] Question: What are the expectations for shifts in Marine Products' model mix post-integration? - Management noted that there are plans to enhance the model mix and accelerate innovation, leveraging the strengths of both companies [49][50] Question: How will the combined dealer network expand distribution? - Management acknowledged that while there are opportunities for cross-synergy, it will be market-specific and will require careful planning [51][82] Question: What is the outlook for the Balise brand post-acquisition? - Management confirmed that the Balise brand will continue to expand, with strong consumer interest and dealer feedback [84][86]

Financial Data and Key Metrics Changes - Q2 net sales increased by $8.4 million or 13.2% year-over-year, reaching $71.8 million, driven by favorable model mix, higher volumes, and pricing [6][11] - Adjusted EBITDA rose to $7.5 million from $3.5 million in the prior year, with an adjusted EBITDA margin improvement of 480 basis points to 10.4% [12][13] - Adjusted net income for the quarter was $4.7 million, or $0.29 per diluted share, compared to $1.7 million, or $0.10 per share in the prior year [12] Business Line Data and Key Metrics Changes - The MasterCraft segment showed strong momentum with new product introductions, including the redesigned X24 and XStar, generating strong demand signals [9] - The pontoon segment, particularly the luxury brand Balise, is executing operational improvements and enhancing margin performance [10] Market Data and Key Metrics Changes - Early boat show engagement has been encouraging, with strong attendance and interest noted in several key markets [9] - Retail demand is expected to be down 5%-10% for the year, but recent trends are tracking toward the better end of that range for the MasterCraft segment [7] Company Strategy and Development Direction - The company announced a definitive agreement to combine with Marine Products Corporation, aiming to strengthen its marine platform through complementary brands and expanded dealer networks [5][15] - The combination is expected to unlock growth opportunities and enhance product development and manufacturing capabilities [15][18] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about the second half of the fiscal year, citing disciplined inventory management and a flexible operating model to adapt to varying demand scenarios [7][16] - The company is raising its full-year guidance for net sales, earnings, and adjusted earnings per share based on strong Q2 performance [13] Other Important Information - The proposed combination with Marine Products Corporation is expected to close in Q2 2026, subject to regulatory approvals [21] - The transaction will be funded with cash on hand, maintaining a debt-free status post-transaction [21][24] Q&A Session Summary Question: Can you elaborate on the additional synergies from the transaction? - Management highlighted opportunities in innovation platforms, manufacturing best practices, and expanded distribution as key areas for synergy beyond the identified $6 million in cost savings [27][29] Question: What is the current state of inventory management? - Management indicated that restocking is largely over, with both MasterCraft and Marine Products managing their inventories effectively [30][32] Question: How did the acquisition price compare to Marine Products' closing price? - Management explained that the mix of cash and stock was appealing to Marine Products, allowing their shareholders to participate in the upside of the combined entity [35][36] Question: What are the expectations for shifts in Marine Products' model mix post-integration? - Management noted that there are plans to enhance the model mix and accelerate innovation, leveraging the strengths of both companies [44][45] Question: How will the combined dealer network expand distribution? - Management acknowledged that while there are opportunities for cross-synergy, the approach will be market-specific, assessing each dealer's capacity to take on additional brands [46][78] Question: What is the outlook for the Balise brand post-acquisition? - Management confirmed that the Balise brand will continue to expand, with strong consumer interest and a new model launch planned [80][81]

FISCAL SECOND QUARTER 2026 RESULTS MASTERCRAFT + MARINE PRODUCTS TO COMBINE F E B R U A R Y 5 , 2 0 2 6 1 DISCLAIMER Forward Looking Statements This presentation includes forward-looking statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Forward-looking statements can often be identified by such words and phrases as "believes," "anticipates," "expects," "intends," "estimates," "may," "will," "should," "continue," and similar expressions and comparable terminology, ...

Core Insights - The company reported Q1 net sales of $69 million, an increase of $3.6 million or 5.6% year over year, driven by pricing, favorable option sales, and lower dealer incentives [12][14] - Adjusted EBITDA rose to $6.7 million, with a margin improvement of 380 basis points to 9.7% [14] - The company maintains a strong financial position with $67.3 million in cash and no debt, allowing for continued capital return to shareholders through share repurchases [14][15] Operational Performance - The company improved pipeline inventory levels by 27% year over year, aligning dealer inventory with expectations and maintaining inventory turns at pre-COVID levels [5][6] - The launch of the new X24 model has generated strong initial dealer and consumer response, reinforcing the company's commitment to innovation and category leadership [7][8] - The pontoon segment showed operational improvements, with a refreshed product lineup well-received at dealer meetings, including the introduction of the Conquest SE model [9][10] Market Outlook - The company anticipates a retail decline of 5-10% for the MasterCraft segment due to ongoing macroeconomic challenges, including elevated interest rates [6][23] - Despite near-term uncertainties, the company is positioned to capitalize on future market stabilization and growth opportunities [19][31] - The company plans to ramp up production in the second half of the fiscal year to meet seasonal demand and support new product initiatives [16][31] Financial Guidance - For fiscal 2026, consolidated net sales are projected between $295 million and $310 million, with adjusted EBITDA expected between $30 million and $35 million [15] - Adjusted earnings per share are forecasted to be between $1.18 and $1.43, reflecting confidence in the company's long-term outlook [15] - The company continues to prioritize returning capital to shareholders, with expectations for total repurchases to exceed prior year levels by the end of the fiscal year [15]

Financial Data and Key Metrics Changes - Net sales for Q1 increased by $3.6 million, or 5.6% year-over-year, reaching $69 million [10] - Adjusted EBITDA rose to $6.7 million compared to $3.8 million in the prior year, with an adjusted EBITDA margin improvement of 380 basis points to 9.7% [12] - Adjusted net income for the quarter was $4.5 million, or $0.28 per diluted share, compared to $1.9 million, or $0.12 per share in the prior year [11] - Gross margin improved by 420 basis points to 22.3% due to strong cost management and favorable mix [10] Business Line Data and Key Metrics Changes - The MasterCraft segment is expected to see a retail decline of 5% to 10% for the year, with early indicators showing the company gaining market share [6][19] - The pontoon segment showed operational improvements despite market challenges, with a refreshed product lineup well received [8] Market Data and Key Metrics Changes - Retail variability continues, with early industry indicators suggesting a slight decline, but the company remains cautiously optimistic about future demand [6][20] - The company is focused on maintaining dealer health and managing inventory levels, which improved by 27% year-over-year [4] Company Strategy and Development Direction - The company is committed to differentiated innovation and category leadership, as evidenced by the launch of the new X24 model [7] - Strategic partnerships and industry involvement are being strengthened to enhance brand presence and consumer experience [8] - The company plans to ramp up production in the second half of the fiscal year to align with seasonal demand and new product initiatives [14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding interest rate cuts and their potential positive impact on consumer behavior [6][26] - The company is managing for long-term growth despite near-term uncertainties, with a focus on capital allocation and shareholder returns [15] Other Important Information - The company ended the quarter with $67.3 million in cash and short-term investments, no debt, and expects to generate positive free cash flow for the year [12] - Over 100,000 shares were repurchased in Q1, totaling $2.3 million, reflecting confidence in the long-term outlook [13] Q&A Session Summary Question: Current marine consumer and retail trends - Management noted that while the industry is slightly down, the company performed well in Q1 and is gaining market share [18][19] Question: Dealer network and retail outlook - Changes to the dealer network are expected to help the company outperform the industry, which is included in the anticipated 5%-10% decline [21] Question: Retail progression through the fiscal year - Management expects a ramp in retail demand in the second half of the fiscal year, driven by new product launches [28] Question: M&A opportunities and leverage comfort level - The company maintains a flexible balance sheet and is open to evaluating M&A opportunities while continuing share repurchases [30]

Financial Data and Key Metrics Changes - Q1 net sales increased by $3.6 million, or 5.6% year-over-year, reaching $69 million [11] - Adjusted EBITDA rose to $6.7 million, compared to $3.8 million in the prior year, with an adjusted EBITDA margin of 9.7%, a 380 basis point improvement [12] - Adjusted net income for the quarter was $4.5 million, or $0.28 per diluted share, compared to $1.9 million, or $0.12 per share in the prior year [12] - Gross margin improved by 420 basis points to 22.3% due to strong cost management and favorable mix [11] Business Line Data and Key Metrics Changes - The MasterCraft segment is expected to see a retail decline of 5% to 10% for the year, despite Q1 performance exceeding expectations [5][21] - The pontoon segment showed operational improvements, with a well-received 2026 lineup and new product introductions [8][9] Market Data and Key Metrics Changes - Pipeline inventory levels improved by 27% year-over-year, indicating a balanced approach to dealer health [4] - Dealer inventory levels are aligned with expectations, and inventory turns are consistent with pre-COVID levels [5] Company Strategy and Development Direction - The company is focused on differentiated innovation and category leadership, highlighted by the launch of the new X family model, the X24 [7] - Strategic partnerships, such as with the World Wake Association, are aimed at enhancing brand presence and community engagement [8] - The company plans to ramp up production in the second half of the fiscal year to meet seasonal demand and support new product initiatives [15] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding interest rate cuts and their potential positive impact on the industry [5][30] - The company remains focused on long-term growth despite near-term uncertainties, with underlying trends moving in their favor [17] Other Important Information - The company ended the quarter with $67.3 million in cash and short-term investments, with no debt [12] - Over 100,000 shares were repurchased in Q1, totaling $2.3 million, reflecting confidence in the long-term outlook [13] Q&A Session Summary Question: Current marine consumer and retail trends - Management noted that while the industry is slightly down, they believe they are gaining market share due to new products and dealer growth [21][24] Question: Impact of dealer network changes on retail outlook - Management confirmed that changes to the dealer network are expected to help gain market share, which is included in the anticipated retail decline [25] Question: Retail cadence and interest rate impacts - Management indicated that they only embed already occurred rate cuts in their forecasts, with a positive outlook on the psychological benefits of lower rates for consumers [30] Question: M&A opportunities and leverage comfort level - Management emphasized maintaining a flexible balance sheet for capital allocation, including share buybacks and evaluating M&A opportunities [34]

Financial Performance - Net sales reached $69 million, a 5.6% increase compared to Q1 FY25[21, 23] - Adjusted EBITDA was $6.7 million, up $2.9 million from $3.8 million in Q1 FY25[21, 23] - Adjusted diluted net income per share was $0.28, an increase of $0.16 from $0.12 in Q1 FY25[21, 24] Balance Sheet and Capital Allocation - The company maintains a strong financial position with approximately $67 million in cash and investments and no debt[21] - The company returned $2.3 million of capital through a share repurchase program[21] - Capital expenditures (TTM) were $10.1 million[27] - Share repurchases (TTM) amounted to $8.4 million[27] Operational Highlights - Wholesale units totaled 565, a 2.5% increase from 551 in Q1 FY25[23] - Dealer inventories decreased by approximately 26% year-over-year and approximately 40% from FY19[21] FY26 Guidance - The company expects Q2 FY26 net sales to be approximately $69 million[30] - The company expects Q2 FY26 adjusted EBITDA to be approximately $5 million[30] - The company expects Q2 FY26 adjusted DEPS to be approximately $0.16[30] - The company anticipates FY26 net sales to be between $295 million and $310 million[30] - The company anticipates FY26 adjusted EBITDA to be between $30 million and $35 million[30] - The company anticipates FY26 adjusted DEPS to be between $1.18 and $1.43[30] - The company anticipates FY26 capital expenditures to be approximately $9 million[30]