MasterCraft Boat Holdings, Inc. (NASDAQ: MCFT) announced financial results for its fiscal 2023 first quarter ended October 2, 2022.
- Eighth consecutive period-over-period record-setting quarter for both net sales and earnings
- Record net sales for the first quarter increased to $169.5 million, up 29.7% from the prior-year period
- Record net income from continuing operations was $24.6 million, or $1.37 per diluted share
- Record Diluted Adjusted Net Income per share, a non-GAAP measure, was $1.43, up 90.7%
- Record Adjusted EBITDA, a non-GAAP measure, increased to $35.9 million, up 72.8%
- Share repurchases of $4.2 million during the quarter
- Completed the sale of our NauticStar business, resulting in a non-cash pretax loss on sale of $22.1 million
Fred Brightbill, CEO and Chairman, commented, “We are proud of our outstanding start to fiscal 2023. Despite macroeconomic volatility and the dynamic business environment, we achieved the best first quarter in the Company’s history. Our ability to mitigate supply chain disruption is enabling more efficient production and throughput, and as a result, we made progress in replenishing dealer inventories, greatly enhancing product availability. Each of our segments contributed to our growth and profitability improvement during the quarter, and we realized structural improvements to the growth potential and margin profile of our business with the sale of NauticStar.”
Brightbill continued, “We delivered an eighth consecutive period-over-period record-setting quarter, Net sales were higher by nearly 30 percent, Adjusted EBITDA grew by nearly 73 percent, Adjusted EBITDA margin increased 530 basis points, and Adjusted Net Income per share grew by more than 90 percent year-over-year. These results would not have been possible without the hard work and dedication of our team who continue to execute against our strategic priorities.”
First Quarter Results
For the first quarter of fiscal 2023, MasterCraft Boat Holdings, Inc. reported consolidated net sales of $169.5 million, up $38.9 million from the first quarter of fiscal 2022. The net sales increase reflects increased volume and mix, along with price increases, partially offset by increased dealer floor plan financing costs and other incentives as dealer inventories begin to return to normal following historically low levels due to the COVID-19 pandemic.
Gross profit increased $15.4 million and gross profit margin increased 370 basis points to 27.1 percent in the first quarter of fiscal 2023 from 23.4 percent in the first quarter of fiscal 2022. The increase was mainly due to higher prices, increased unit volumes, and improved production efficiencies, partially offset by inflationary pressures that drove costs higher and higher dealer incentives.
Operating expenses decreased $0.5 million for the first quarter of fiscal 2023, compared to the prior-year period primarily as a result of goodwill impairment charges associated with our Aviara segment in fiscal 2022.
Net income from continuing operations was $24.6 million for the first quarter of fiscal 2023, compared to $12.2 million in the prior-year period. Diluted net income from continuing operations per share was $1.37, compared to $0.65 for the first quarter of fiscal 2022.
Including discontinued operations, net income was $4.1 million for the first quarter of fiscal 2023, compared to net income of $10.4 million in the prior-year period. The $4.1 million includes a $20.6 million loss from discontinued operations.
Adjusted Net Income increased to $25.7 million for the first quarter, or $1.43 per diluted share, compared to $14.2 million, or $0.75 per diluted share, in the prior-year period.
Adjusted EBITDA was $35.9 million for the first quarter of fiscal 2023, compared to $20.8 million in the prior-year period. Adjusted EBITDA margin was 21.2 percent for the first quarter, up from 15.9 percent for the prior-year period.
Concluded Brightbill, “Looking forward, we are raising our guidance for the full year based on our strong performance. We will continue to monitor the strength of retail demand and adjust our production plans as appropriate to maintain healthy dealer inventories. Our guidance range reflects the potential for a range of retail demand scenarios.”
The Company’s outlook is as follows:
- For full year fiscal 2023, consolidated net sales are now expected to be between $590 million and $625 million, with Adjusted EBITDA between $108 million and $118 million, and Adjusted Earnings per share of between $4.20 and $4.60. We continue to expect capital expenditures to be approximately $30 million for the full year.
- For the second quarter of fiscal 2023, consolidated net sales are expected to be approximately $150 million, with Adjusted EBITDA of approximately $26 million, and Adjusted Earnings per share of approximately $1.00.