Tough year for boat manufacturers

[jackdaniels]

Still in business but did not have a good year

ATLANTA, Oct 28, 2009 /PRNewswire-FirstCall via COMTEX/ - Marine Products Corporation (MPX) announced its unaudited results for the quarter ended September 30, 2009. Marine Products is a leading manufacturer of fiberglass boats under two brand names: sterndrive and inboard pleasure boats by Chaparral, including Premiere Sport Yachts, SSi Wide Techs, SSX Bowriders, Sunesta Wide Techs and Xtremes, Signature Cruisers, and outboard sport fishing boats by Robalo.

For the quarter ended September 30, 2009, Marine Products generated net sales of $8,734,000, a 72.3 percent decrease compared to $31,582,000 last year. The decrease in net sales was due to a decrease of 75.7 percent in the number of boats sold, as well as a 2.5 percent decrease in the average gross selling price per boat due to a change in model mix. Gross profit for the quarter was $1,138,000, or 13.0 percent of net sales, compared to $5,104,000, or 16.2 percent of net sales, in the prior year. Gross profit as a percentage of net sales declined compared to the prior year due to low production levels, which resulted in significant production inefficiencies. Unit sales among all models declined significantly compared to the prior year, because our dealers met the majority of retail demand by liquidating their existing inventory. Average gross selling price per boat declined among Sunesta Wide Techs and Xtremes, partially offset by increased average selling prices in some of our other product lines, including sales of Premiere Sport Yachts.

Operating loss for the quarter was $3,340,000, compared to an operating profit of $1,018,000 in the third quarter last year due to lower gross profit and higher selling, general and administrative expenses. Selling, general and administrative expenses in the third quarter of 2009 increased by 9.6 percent compared to the prior year due to $1,753,000 in costs related to our continued efforts to assist our dealers in selling field inventory, partially offset by decreases in other expenses which vary with sales and profitability, such as incentive compensation, as well as reduced employee headcount.

Net loss for the quarter ended September 30, 2009 was $1,608,000, a decrease compared to net income of $684,000 in the prior year. The net loss was due to an operating loss and lower interest income. Diluted loss per share for the quarter was $0.04, a decrease compared to $0.02 diluted earnings per share in the prior year.

Net sales for the nine months ended September 30, 2009 were $35,158,000, a 77.0 percent decrease compared to the first nine months of 2008. Net loss for the nine-month period was $7,929,000 or $0.22 loss per diluted share compared to net income of $8,712,000 or $0.24 diluted earnings per share in the prior year.

[Kahi]

While it might seem to be negative forecast of things to come, it is amazing for any company that stayed the same or increased sales in 2009.

As in any industry, we are seeing a major "shake-out" of companies that unable to substantiate, for many reasons, these tough economic times.

It does pain me, to see employees and skilled craftsman out of work.