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Marine Products Corporation Reports Third Quarter 2015 Financial Results

ATLANTA, Oct. 28, 2015 /PRNewswire/ -- Marine Products Corporation (NYSE: MPX) announced its unaudited results for the quarter ended September 30, 2015.  Marine Products is a leading manufacturer of fiberglass boats under two brand names: Chaparral and Robalo. Chaparral builds sterndrive, jet drive and outboard pleasure boats, including H2O Sport and Fish & Ski Boats, SSi and SSX Sportboats, Sunesta Sportdecks, Signature Cruisers, SunCoast Sportdeck outboards and Vortex Jet Boats.  Robalo builds outboard sport fishing boats which include center console, dual console, walkaround cabin and Cayman bay boat models.

For the quarter ended September 30, 2015, Marine Products generated net sales of $47,038,000, a 24.0 percent increase, compared to $37,932,000 in the same period of the prior year.  The increase in net sales was due to higher unit sales of our Robalo outboard sport fishing boats, as well as higher sales of our Vortex Jet Boats and Chaparral Suncoast outboard boats during the quarter as compared to the prior year.

Gross profit for the quarter was $9,874,000, or 21.0 percent of net sales, a 41.7 percent increase compared to gross profit of $6,967,000, or 18.4 percent of net sales, in the same period of the prior year.  Gross profit for the third quarter increased compared to the prior year due to higher net sales and an improved gross margin.  Gross margin improved during the quarter compared to the prior year due to a favorable model mix and improved operating efficiencies due to higher production volumes. 

Operating profit for the quarter was $4,454,000, an increase of 72.9 percent, compared to $2,576,000 in the third quarter of last year.  Selling, general and administrative expenses were $5,420,000 in the third quarter of 2015, an increase of 23.4 percent compared to the third quarter of 2014.  Selling, general and administrative expenses increased due to expenses that vary with sales and profitability, as well as higher advertising expenses.  These increases were partially offset by decreases in warranty expenses, a result of favorable warranty claims experience. As a percentage of net sales, selling, general and administrative expenses were approximately the same during the third quarters of 2015 and 2014.

Net income for the quarter ended September 30, 2015 was $3,103,000, an increase of $1,221,000 or 64.9 percent, compared to net income of $1,882,000 for the third quarter of 2014.  Diluted earnings per share were $0.08 in the third quarter of 2015, an increase of $0.03 compared to the third quarter of the prior year.   

Net sales for the nine months ended September 30, 2015 were $157,180,000, an increase of 17.6 percent, compared to the first nine months of 2014.  Net income for the nine-month period was $10,461,000 or $0.28 earnings per diluted share, compared to net income of $6,873,000, or $0.18 earnings per diluted share in the prior year. 

Richard A. Hubbell, Marine Products' President and Chief Executive Officer stated, "We are pleased to report continued growth in sales of our Robalo outboard sport fishing boats during the third quarter.  In addition, we reported increased sales of our Vortex Jet Boats and Chaparral SunCoast outboards, which are new in 2015.  Our profitability improved due to efficiencies gained from higher unit production.  As the retail selling season for 2015 concludes, we are increasingly optimistic about the selling environment for our products.  The market for recreational boating continues to improve, and our dealers are enthusiastic about our 2016 models and are looking ahead to the winter boat show season. Although the international market for recreational boat sales continues to be weak, we note that our domestic sales increased by 32.4 percent during the third quarter of 2015 compared to the prior year. Our dealer inventories are comparable to the end of the second quarter and to this time last year, and our backlog is strong.  For these reasons, we have increased production during the fourth quarter in order to have sufficient current model year inventory to satisfy dealer demand," concluded Hubbell. 

Marine Products Corporation will hold a conference call today, October 28, 2015 at 8:00 a.m. Eastern Time to discuss the results for the quarter.  Interested parties may listen in by accessing a live webcast in the investor relations section of Marine Products' website at www.marineproductscorp.com.  The live conference call can also be accessed by calling (888) 438-5525 or (719) 325-2308 for international callers and using the conference ID #161927.  A replay will be available in the investor relations section of Marine Products' website beginning approximately two hours after the call. 

Marine Products Corporation (NYSE: MPX) designs, manufactures and distributes premium-branded Chaparral sterndrive, jet drive and outboard pleasure boats, and Robalo offshore sport fishing boats.  The Company continues to diversify its product lines through product innovation.  With premium brands, a solid capital structure, and a strong independent dealer network, Marine Products Corporation is prepared to capitalize on opportunities to increase its market share and to generate superior financial performance to build long-term shareholder value.  For more information on Marine Products Corporation visit our website at www.marineproductscorp.com.

Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements that look forward in time or express management's beliefs, expectations or hopes.  In particular, such statements include, without limitation, our increasing optimism about the selling environment for our products; our belief that the market for recreational boating continues to improve; our perception that our dealers are enthusiastic about our 2016 models and look forward to the winter boat show season; and our belief that we are prepared to capitalize on opportunities to increase our market share and to generate superior financial performance to build long-term shareholder value. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Marine Products Corporation to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements.  These risks include possible decreases in the level of consumer confidence and available funds impacting discretionary spending, increased interest rates and fuel prices, weather conditions, changes in consumer preferences, deterioration in the quality of Marine Products' network of independent boat dealers or availability of financing of their inventory, and competition from other boat manufacturers and dealers.  Additional discussion of factors that could cause the actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in Marine Products' Form 10-K, filed with the Securities and Exchange Commission for the year ending December 31, 2014.

For information contact:



BEN M. PALMER                            

JIM LANDERS

Chief Financial Officer                       

Vice President, Corporate Finance

(404) 321-7910                                   

(404) 321-2162

irdept@marineproductscorp.com           

jlanders@marineproductscorp.com

 

 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

























CONSOLIDATED STATEMENTS OF OPERATIONS  (In thousands except per share data)











Periods ended September 30, (Unaudited)


Third Quarter







Nine Months




2015



2014


% BETTER
(WORSE)




2015



2014


% BETTER
(WORSE)


Net Sales

$

47,038


$

37,932


24.0

%


$

157,180


$

133,609


17.6

%

Cost of Goods Sold


37,164



30,965


(20.0)




124,497



108,372


(14.9)


Gross Profit 


9,874



6,967


41.7




32,683



25,237


29.5


Selling, General and Administrative Expenses


5,420



4,391


(23.4)




17,552



15,768


(11.3)


Operating Profit


4,454



2,576


72.9




15,131



9,469


59.8


Interest Income


103



116


(11.2)




325



359


(9.5)


Income Before Income Taxes


4,557



2,692


69.3




15,456



9,828


57.3


Income Tax Provision 


1,454



810


(79.5)




4,995



2,955


(69.0)


Net Income 

$

3,103


$

1,882


64.9

%


$

10,461


$

6,873


52.2

%





































EARNINGS PER SHARE 


















   Basic  

$

0.08


$

0.05


60.0

%


$

0.28


$

0.19


47.4

%

   Diluted  

$

0.08


$

0.05


60.0

%


$

0.28


$

0.18


55.6

%



















AVERAGE SHARES OUTSTANDING


















   Basic  


36,889



36,904






36,982



36,950




   Diluted  


36,980



37,190






37,163



37,236




 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES












CONSOLIDATED BALANCE  SHEETS






At September 30, (Unaudited)


(in thousands)



2015



2014

ASSETS






Cash and cash equivalents

$

9,111


$

5,296

Marketable securities


9,007



12,024

Accounts receivable, net


3,961



3,515

Inventories


32,306



24,573

Income taxes receivable


713



332

Deferred income taxes


2,372



1,374

Prepaid expenses and other current assets


1,826



1,644

  Total current assets


59,296



48,758

Property, plant and equipment, net


12,809



11,052

Goodwill 


3,308



3,308

Other intangibles, net


465



465

Marketable securities


26,106



32,492

Deferred income taxes


2,831



3,347

Other assets


9,798



8,495

  Total assets

$

114,613


$

107,917







LIABILITIES AND STOCKHOLDERS' EQUITY






Accounts payable

$

9,083


$

5,939

Accrued expenses and other liabilities


9,986



10,369

  Total current liabilities


19,069



16,308

Long-term pension liabilities


6,465



6,518

Other long-term liabilities


77



83

  Total liabilities


25,611



22,909

Common stock 


3,814



3,817

Capital in excess of par value


3,479



3,638

Retained earnings


83,628



78,381

Accumulated other comprehensive loss


(1,919)



(828)

  Total stockholders' equity


89,002



85,008

  Total liabilities and stockholders' equity 

$

114,613


$

107,917

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/marine-products-corporation-reports-third-quarter-2015-financial-results-300167340.html

SOURCE Marine Products Corporation

Oct 28, 2015
Forward-Looking Statement:
This website contains statements that constitute "forward-looking statements" under the Private Securities Litigation Reform Act of 1995, including all statements that look forward in time or express management's beliefs, expectations or hopes. In particular, such statements include, without limitation: our belief that international sales will continue to be weak in 2019; statements regarding our maintenance of conservative standards of liquidity and credit quality in our marketable securities portfolio; our belief that our effective tax rate in 2019 will be similar to our effective tax rate in 2018; our view that open market repurchases are an important part of our capital allocation strategy and an important tool to increase overall shareholder return; our belief that our cash and marketable securities balance continues to provide liquidity to support both our current operations as well as future growth opportunities; our receptiveness to considering acquisition candidates which manufacture products which complement our own offerings; our belief that interest in recreational boating as a safe, fun recreational activity continues to be strong in 2019; our belief that high consumer confidence, general economic strength and a favorable dealer and consumer financing environment will generate strong sales in 2019; our belief that we will be a leader in marketing and branding strategies that consistently present a luxury-oriented message and integrate those expectations into the boater's entire experience; our belief that the popularity of our Robalo outboard sportfishing boats will continue to grow and that boaters are increasingly gravitating towards larger models; and our belief that our implementation of an enhanced marketing effort will better serve to elevate the customer experience. The actual results of the Company could differ materially from those indicated by the forward-looking statements because of various risks and uncertainties, including, without limitation, those identified under the title "Risk Factors" in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission for the year ending December 31, 2018. In addition, the payment of future dividends is subject to Board discretion and depends on many factors, including the Company's available cash flow and competing uses for cash. All of the foregoing risks and uncertainties are beyond the ability of the Company to control, and in many cases the Company cannot predict the risks and uncertainties that could cause its actual results to differ materially from those indicated in the forward-looking statements. The Company does not undertake to update these forward-looking statements.


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