MarineMax(HZO) - 2026 Q1 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Revenue for the December quarter increased year-over-year to $505 million, supported by nearly 11% same-store sales growth [11][12] - Gross profit was $160 million, down from the prior year due to margin pressure, with gross margins over 400 basis points below historical levels [13][14] - Reported net loss per share was $0.36, or $0.21 on an adjusted basis, with adjusted EBITDA at $15.5 million [14][15] - The balance sheet remained strong with nearly $165 million in cash and a healthy net debt to adjusted EBITDA ratio of just over 2x [15] Business Line Data and Key Metrics Changes - Same-store sales performance was supported by premium brand offerings and a shift towards larger products, despite unit volume declining by low- to mid-single digits [7][12] - Higher-margin businesses, such as marinas, finance and insurance, and super yacht services, contributed positively to consolidated gross profit [13][14] Market Data and Key Metrics Changes - Market conditions remained challenging with elevated promotional activity and cautious retail behavior affecting demand patterns [6][9] - The company successfully reduced inventory levels by nearly $170 million compared to last year, indicating progress towards normalized inventory levels [8][15] Company Strategy and Development Direction - The company aims to maintain an appropriate inventory position, deliver a high-quality customer experience, and manage the business with a long-term perspective [9][10] - Continued focus on acquiring complementary, less cyclical, higher-margin operations to build a more durable business model [8] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding early season demand signals from boat shows, indicating potential for growth in the premium segment [10][19] - The outlook for Fiscal 2026 remains balanced due to ongoing uncertainty in the broader consumer and macroeconomic environment, with expectations for adjusted EBITDA in the range of $110 million-$125 million [16][17] Other Important Information - Customer deposits remained flat year-over-year, which is seen as a positive sign given the current environment [15][50] - The company continues to prioritize maintaining inventory levels and enhancing operational efficiency to support long-term value creation [11][19] Q&A Session Summary Question: What are the assumptions regarding the discounting environment as the selling season progresses? - Management expects the promotional environment to remain active during the winter, with potential improvement in margins as inventory levels normalize in the second half of the fiscal year [21][22] Question: Can you quantify the drivers of the decline in gross margin? - The decline in gross margin is primarily driven by promotional pressures rather than mix, with new boat margins being significantly lower than the previous year [66] Question: How is demand across various income groups and price points? - Demand at the premium end has been strong, while the lower end remains challenged, with overall consumer sentiment affected by broader economic uncertainty [38][42]