ATLANTA, Jan. 25, 2023 /PRNewswire/ -- Marine Products Corporation (NYSE: MPX) announced its unaudited results for the quarter and year ended December 31, 2022. Marine Products is a leading manufacturer of fiberglass boats under the brand names of Chaparral and Robalo. Chaparral's sterndrive models include SSi and SSX, along with the Chaparral Surf Series. Chaparral's outboard offerings include OSX Luxury Sportboats and SSi outboard models. Robalo builds an array of outboard sport fishing boats, which include center consoles, dual consoles and Cayman Bay Boat models.
For the quarter ended December 31, 2022, Marine Products generated record quarterly net sales of $108.5 million, a 42 percent increase compared to $76.5 million in the same quarter of the prior year. The increase in net sales was due to a 29 percent increase in the number of boats sold during the quarter and a 12 percent increase in the average selling price per boat. Unit sales increased during the quarter primarily due to our success during the quarter in finishing and shipping substantially completed boats from inventory, as supply chain issues continued to improve. Average selling prices increased primarily due to a favorable model mix and price increases to cover increased costs including primarily materials and components. Unit sales increased within all of Chaparral's models as well as many Robalo models.
Gross profit for the fourth quarter of 2022 was $27.3 million compared to $19.2 million in the fourth quarter of the prior year. Gross margin as a percentage of net sales was 25 percent in the fourth quarter of both years. Operating profit for the fourth quarter of 2022 was $14.8 million, an increase of 39 percent compared to operating profit of $10.7 million in the fourth quarter of last year. Selling, general and administrative expenses were $12.5 million in the fourth quarter of 2022 compared to $8.5 million in the fourth quarter of 2021. These expenses increased due to costs that vary with sales and profitability, such as incentive compensation, sales commissions and warranty expenses. In addition, the Company recorded a $1.2 million pension settlement charge associated with its defined benefit pension plan. Selling, general and administrative expenses were 12 percent of net sales in the fourth quarter of 2022 compared to 11 percent of net sales in the prior year. Net income for the fourth quarter of 2022 was a record $11.9 million, an increase of 40 percent compared to net income of $8.4 million in the fourth quarter of 2021. Earnings before interest, taxes, depreciation and amortization (EBITDA)1 for the fourth quarter of 2022 was $15.3 million, an increase of $4.2 million or 38 percent, compared to the fourth quarter of 2021.
Diluted earnings per share in the fourth quarter of 2022 were $0.35, an increase of 40 percent compared to $0.25 in the fourth quarter of the prior year. The effective tax rate for the fourth quarter of 2022 was 22 percent, a slight increase compared to an effective tax rate of 21 percent for the fourth quarter of the prior year.
Net sales for the twelve months ended December 31, 2022 were a record $381.0 million, an increase of 28 percent compared to the twelve months ended December 31, 2021. Net income during 2022 was a record $40.3 million or $1.18 diluted earnings per share, compared to net income of $29.0 million or $0.85 diluted earnings per share in 2021. EBITDA1 for 2022 was $53.7 million compared to $38.2 million in 2021.
"During the fourth quarter our supply chain and transportation issues continued to improve, allowing us to increase boat shipments to satisfy dealer demand for new 2023 models," stated Ben M. Palmer, Marine Products' President and Chief Executive Officer. "In fact, our fourth quarter 2022 shipments were the highest of any quarter in 2022 in spite of the seasonal impact of two holidays. In addition to higher unit sales, these positive developments lowered our working capital requirements, which are reflected in lower inventories and a higher cash balance than at the end of the third quarter. While production and transportation challenges continue, we are pleased with the improvement. At the end of the quarter, field inventories began to increase to support our dealers during the upcoming 2023 winter boat show season.
"Indications of attendance and orders from the early boat shows are positive, so we are maintaining a high production schedule and have allocated dealer deliveries through the first quarter. As the retail selling season gets underway, however, we will monitor market indications from the upcoming winter boat shows for any changes in customer demand caused by interest rate increases and economic uncertainty," concluded Palmer.
Marine Products Corporation will hold a conference call today, January 25, 2023, 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 marineproductscorp.com. Additionally, the live conference call can be accessed by calling (888) 660-6357 or (929) 201-6127 for international callers and using conference ID number 9979064. 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 and outboard pleasure boats, and Robalo outboard 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 generate superior financial performance to continue building long-term shareholder value. For more information on Marine Products Corporation visit our website at 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, the statements (i) regarding the unpredictability of our improved production and transportation issues, (ii) the consistency of indications of orders and demand from the early boat shows compared to the same period in 2022 and (iii) our monitoring of market indications from the upcoming winter boat shows for any changes in customer demand caused by interest rate increases and economic uncertainty. 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' Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (the "SEC") for the year ended December 31, 2021.
For information about Marine Products Corporation or this event, please contact:
Michael L. Schmit
Chief Financial Officer
Vice President Corporate Services
Marine Products Corporation has used the non-GAAP financial measure of earnings before interest, taxes, depreciation and amortization (EBITDA) in today's earnings release, and anticipates using EBITDA in today's earnings conference call. EBITDA should not be considered in isolation or as a substitute for operating income, net income or other performance measures prepared in accordance with GAAP.
Marine Products Corporation uses EBITDA as a measure of operating performance because it allows us to compare performance consistently over various periods without regard to changes in our capital structure.
A non-GAAP financial measure is a numerical measure of financial performance, financial position, or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. Set forth below is a reconciliation of EBITDA with Net Income, the most comparable GAAP measure. This reconciliation also appears on Marine Products Corporation's investor website, which can be found on the Internet at marineproductscorp.com.
1 EBITDA is a financial measure which does not conform to GAAP. Additional disclosure regarding this non-GAAP financial measure and its reconciliation to net income, the nearest GAAP financial measure, is disclosed in Appendix A to this press release.
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 2022
DECEMBER 31, 2021
Cash and cash equivalents
Accounts receivable, net
Income taxes receivable
Prepaid expenses and other current assets
Total current assets
Property, plant and equipment, net
Other intangibles, net
Pension and retirement plans assets
Deferred income taxes
LIABILITIES AND STOCKHOLDERS' EQUITY
Accrued expenses and other liabilities
Total current liabilities
Pension and retirement plans liabilities
Other long-term liabilities
Capital in excess of par value
Accumulated other comprehensive loss
Total stockholders' equity
Total liabilities and stockholders' equity
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)
Period ended December 31, (Unaudited)
Cost of goods sold
Selling, general and administrative expenses
Interest income (expense)
Income before income taxes
Income tax provision
EARNINGS PER SHARE
AVERAGE SHARES OUTSTANDING
Periods ended December 31,
Three Months Ended
Twelve Months Ended
Reconciliation of Net Income to EBITDA
Income tax provision
Depreciation and amortization
Interest income (expense)
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SOURCE Marine Products Corporation