MarineMax, Inc. Q4 FY2025 earnings call

• Team dedication in a challenging recreational boating industry despite headwinds like elevated interest rates, inflation, trade wars, and geopolitical tensions. Full - year adjusted earnings and adjusted EBITDA were in line with previous guidance. - Fourth - quarter revenue of over $552 million with over 2% same - store sales growth, and gross margins expanded to 34.7% due to diversified business model including higher - margin areas. - Success at Fort Lauderdale International Boat Show with examples like a 35 - meter Yacht sale resulting from cross - business touchpoints. - Launch of flagship yacht sales and service center in Fort Myers, Florida, spanning over 30,000 square feet, combining multiple services. - Technology investments like Boatyard subscription - based customer experience platform with over 160% active subscriber growth in twelve months, and CustomerIQ business growth intelligence engine being rolled out across businesses. - Optimization of business by eliminating underperforming brands, refining product portfolio, and strategic store optimization. - Addition of new board members Odilon Almeda and Dan Shiapa with proven track records in innovation and scaling global operations.

For the fourth quarter, MarineMax achieved revenue of over $552 million with same - store sales growth of more than 2%. Gross margins expanded to 34.7%. For fiscal 2025, revenue was $2.31 billion, with a same - store sales decline of just over 2% and a full - year gross margin of 32.5%. Adjusted EBITDA for the full year was about $110 million compared with $160 million in the prior year. Diversified revenue sources such as finance and insurance, parts and service, superyacht services, and marina operations (including IGY) contribute to the company's financial resilience. These segments, like finance and insurance, parts and service, etc., have higher margins and provide balance. For example, higher - margin businesses like these help in maintaining overall gross margins. The revenue contribution % of these segments isn't explicitly stated in absolute percentage terms in the transcript but their role in driving the financials is clear.

• Fiscal 2026 adjusted EBITDA is expected to be in the range of $110 million to $125 million, and adjusted net income in the range of $0.40 to $0.95 per diluted share. - Assumes industry units for fiscal year will be slightly down to slightly up, with same - store sales growth flat to slight. - Expect to maintain annual consolidated gross margins in the low 30s. - Incorporates currently announced interest rate cuts, uses an annual effective tax rate of 26.5% with a share count of around 22.8 million shares. - Projections exclude impact of material acquisitions or other unforeseen developments including changes in global economic conditions.

• Impact of seasonality and weather. - Global economic conditions. - Level of consumer spending. - Company's ability to capitalize on opportunities or grow its market share. - Numerous other factors identified in the company's most recently filed 10 - Ks and 10 - Qs and other SEC filings.

Q: Good morning. Thanks for taking my questions. So obviously, the same - store sales number accelerated nicely from 3Q to 4Q. I was hoping you could help us out just splitting sort of how much of that was units versus ASPs and then I guess similar question on the month of October. I think you said positive same - store sales for October. Are you actually seeing, you know, unit acceleration, into the off - season?

A: Yeah. A great question, James. So, obviously, you guys follow the industry. The industry for the core categories that we're in has seen softness, double - digit declines in July, August, and September. Some categories, 25%, etcetera, from a unit perspective. So we typically outperform the industry. So our units for the quarter are down in the mid - single - digit range, which is better than the industry overall. So the difference from down mid - single - digit to up 2% is the increase in average unit selling price during the quarter. And then on the month of October, you gotta keep in mind the month of October last year, we were dealing with a hurricane in Florida. But our units were up in the month of October and we all did see a modest increase in average unit selling price.

Q: Hey. Good morning, guys. Thanks for taking my question. I just want to ask about gross margins. Obviously, jumped, I think, 34% in the quarter. You've been pretty consistent keeping them above 30% here in tough, you know, market. And, obviously, you know, some of that is mix, but it appears your adjacencies are holding up well. Could you just, you know, kinda tap into that a little bit deeper? And I'd love to kind of understand, you know, how much of that has been kind of strategic initiatives, cross - sell synergies, etcetera versus just sustainable demand within those segments?

A: I can comment. I'll take a first stab that, yeah. In the current environment, boat margins are the second lowest I've seen in twenty - seven years. They're not down as far as they were in the great financial crisis, but they're very low. They're, like, three to 350 basis points below normal. And so hopefully over time, we'll see some upside in boat margins as inventories normalize. But I do think our strategy of expanding in these higher - margin categories, whether it's the marinas, superyacht services, finance and insurance, service, parts, and accessories. A lot there's a lot of different higher - margin components that we've been expanding with. I think, really shines in an environment like this and helps us maintain elevated gross margins overall. It comes through in the quarter. And, Mike, when we set out with this strategy and we're very focused on it with these higher - margin business businesses and the growth we've had in those and the investments we've made in those businesses. It does show through. It shines. And you ask a question. Yeah. Those businesses, you know, have what's close to recurring type revenue as you can get. So you kinda rely on those types of things. Of course, you gotta manage the business. But we're continue to unlock different synergies, cross - selling, know, consumers feeling good about, you know, buying a larger yacht at a MarineMax, you know, Fort Myers location, let's say. Then feeling good about, wow. What if I wanna put that in charter with Fraser Yachts or whatever it might be so that they feel comfortable with that all the way up to, you know, where are they gonna put their boat when they get to The Caribbean through our IGY marina. So we're seeing a lot more of those synergies. And we'll continue to unlock those as well.

Q: Thanks. Good morning. Mike, kind of looking at the guidance for fiscal 2026, I guess, your industry assumptions relative to your same - store sales. It looks like, I mean, unless I'm reading this wrong, it looks like you're expecting kinda more in line of performance with the industry versus kind of more of the outperformance that you've had before, especially given the mix towards, you know, higher - end premium boats. Am I reading that wrong? Are you are you trying to take a little more cautious view? On mix, or how should we think about kind of what's embedded in that guided in terms of, you know, relative performance to the industry?

A: No. Eric, I think you're reading that right. I think the, you know, the first assumption is does the industry get the flattish units from negatives. That's one assumption that's in there. And then, obviously, what happens with mix from our perspective. But I think we're trying to be prudent in terms of our guidance figures because you're right. We typically do outperform what the industry does. But I think we're really trying to see let let's let's get through fiscal 2026. Let's see that the industry really does get back to, you know, first to zero instead of negative and then to slightly positive in the second half of the year.

Q: Hey. Good morning. Thanks for taking my question. I'd like to start on same - store sales cadence. On the one hand, it seems that we're assuming some sequential improvement as we get to the back half in terms of market performance. But then on the other hand, we have some sort of one - time lapse, like, you know, lapping the hurricane in Florida last year, which drove, you know, the easiest comp in one Q. So just trying to understand the puts and takes as we think about the shape of the year.

A: No. It's a great question. You're right. I mean, the state of Florida was impacted by hurricanes. We were down negative 11% in the December quarter, then up 11 in March. So technically, we do have an easier comparison right now, which is why I said with October being up, it's up against storms. And then when you go out throughout the year, obviously, the quarter with Liberation Day, which is the June quarter, in theory, is another easy comp. We were down 9%. And then it sort of levels off in September. So you do gotta bake all it in from an assumption perspective. I think the point that I was trying to make in my prepared remarks is that when you look at our bottom line financial performance in the December and the March, we exceeded, you know, our thinking in the street and our guidance in those two quarters. From an EBITDA and from an earnings perspective. So when you're modeling out the whole year, factoring in the same - store sales questions that you're asking. We actually have an easier comparison from an earnings perspective in the back half of the year than the front half of the year.