Fiscal Year 2023 Highlights
- Revenue increased 11% to
$1.94 billion - Same-store sales increased 3%
- Gross profit margin of 27.6%
- A
$147 million non-cash intangible asset impairment charge in the fourth quarter generated a GAAP net loss of$(39) million , or$(2.69) per diluted share and adjusted diluted earnings per share1 of$5.10 - Adjusted EBITDA1 was
$167 million
“Our team delivered record revenue, solid gross margins and strong cash generation in fiscal 2023, despite a dynamic operating environment. Healthy demand and effective execution drove a double-digit revenue increase and a 3.0% increase in same-store sales for the year. Our gross profit margin continues to stabilize, bolstered by a 26% increase in our higher-margin service, parts and other sales which helped offset the expected decline in product margins as the industry returns to historical seasonality and more normalized pricing,” commented
“Moving into fiscal 2024, our proactive and aggressive approach to inventory management positions us well as we enter the seasonally slower winter months. We have reinvigorated our deal activity in-line with our strategic priorities and remain focused on executing our proven strategy to continue outperforming the industry and driving value for our shareholders.”
For the Three Months Ended | 2023 | 2022 | $ Change | % Change | |||||||||||
Revenues | (unaudited, $ in thousands) | ||||||||||||||
New boat | $ | 264,357 | $ | 236,227 | $ | 28,130 | 11.9 | % | |||||||
Pre-owned boat | 91,836 | 67,348 | 24,488 | 36.4 | % | ||||||||||
Finance & insurance income | 13,039 | 12,743 | 296 | 2.3 | % | ||||||||||
Service, parts & other | 81,749 | 81,205 | 544 | 0.7 | % | ||||||||||
Total revenues | $ | 450,981 | $ | 397,523 | $ | 53,458 | 13.4 | % | |||||||
Fiscal Fourth Quarter 2023 Results
Revenue for fiscal fourth quarter 2023 was
New boat revenue increased 11.9%, driven by an increase in average unit price, partially offset by a slight decrease in units sold. Finance & insurance income increased 2.3% compared to the prior year quarter. Pre-owned boat revenue increased 36.4% driven by an increase in both unit sales and average price per unit. Service, parts & other sales were up 0.7% compared to the prior year quarter.
Gross profit totaled
Fiscal fourth quarter 2023 selling, general and administrative expenses totaled
In fiscal fourth quarter 2023, the Company recorded a non-cash impairment charge of
Net loss for fiscal fourth quarter 2023 totaled
Fiscal fourth quarter 2023 Adjusted EBITDA1 decreased 38.1% to
For the Twelve Months Ended | 2023 | 2022 | $ Change | % Change | |||||||||||
Revenues | (unaudited, $ in thousands) | ||||||||||||||
New boat | $ | 1,223,691 | $ | 1,139,331 | $ | 84,360 | 7.4 | % | |||||||
Pre-owned boat | 334,477 | 294,832 | 39,645 | 13.4 | % | ||||||||||
Finance & insurance income | 56,325 | 55,977 | 348 | 0.6 | % | ||||||||||
Service, parts & other | 321,817 | 254,682 | 67,135 | 26.4 | % | ||||||||||
Total revenues | $ | 1,936,310 | $ | 1,744,822 | $ | 191,488 | 11.0 | % | |||||||
Fiscal Year Ended
Revenue for the fiscal year ended
Gross profit totaled
Fiscal year 2023 selling, general and administrative expenses totaled
Net loss for fiscal year 2023 totaled
As of
Total long-term debt as of
Fiscal Year 2024 Guidance
For fiscal full year 2024, OneWater anticipates dealership same-store sales to be up low to mid-single digits, despite an expected challenging macroeconomic environment. Adjusted EBITDA2 is expected to be in the range of
Conference Call and Webcast
OneWater will host a conference call to discuss its fiscal fourth quarter earnings on
https://register.vevent.com/register/BIa0742f62d7694efab2f86b0ae3789486
Alternatively, a live webcast of the conference call can be accessed through the “Events” section of the Company’s website at https://investor.onewatermarine.com/ where it will be archived for one year.
1 See reconciliation of Non-GAAP financial measures below.
2 See reconciliation of Non-GAAP financial measures below for a discussion of why reconciliations of forward-looking Adjusted EBITDA are not available without unreasonable effort.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands except per share data) (Unaudited) | |||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Revenues: | |||||||||||||||
New boat | $ | 264,357 | $ | 236,227 | $ | 1,223,691 | $ | 1,139,331 | |||||||
Pre-owned boat | 91,836 | 67,348 | 334,477 | 294,832 | |||||||||||
Finance & insurance income | 13,039 | 12,743 | 56,325 | 55,977 | |||||||||||
Service, parts & other | 81,749 | 81,205 | 321,817 | 254,682 | |||||||||||
Total revenues | 450,981 | 397,523 | 1,936,310 | 1,744,822 | |||||||||||
Gross Profit | |||||||||||||||
New boat | 54,902 | 61,247 | 268,469 | 305,305 | |||||||||||
Pre-owned boat | 18,210 | 18,259 | 75,953 | 81,665 | |||||||||||
Finance and insurance | 13,039 | 12,743 | 56,325 | 55,977 | |||||||||||
Service, parts & other | 32,856 | 33,960 | 134,379 | 110,708 | |||||||||||
Total gross profit | 119,007 | 126,209 | 535,126 | 553,655 | |||||||||||
Selling, general and administrative expenses | 84,652 | 79,658 | 345,524 | 302,113 | |||||||||||
Depreciation and amortization | 6,588 | 5,056 | 23,898 | 15,605 | |||||||||||
Transaction costs | 171 | 2,566 | 1,839 | 7,724 | |||||||||||
Change in fair value of contingent consideration | (2,367 | ) | (642 | ) | (1,604 | ) | 10,380 | ||||||||
Loss on impairment | 147,402 | — | 147,402 | — | |||||||||||
Net (loss) income from operations | (117,439 | ) | 39,571 | 18,067 | 217,833 | ||||||||||
Other expense (income): | |||||||||||||||
Interest expense – floor plan | 7,393 | 1,591 | 25,080 | 4,647 | |||||||||||
Interest expense – other | 9,292 | 5,264 | 34,557 | 13,201 | |||||||||||
Loss on extinguishment of debt | — | 356 | — | 356 | |||||||||||
Other expense (income), net | 1,418 | 3,302 | 953 | 3,793 | |||||||||||
Total other expense, net | 18,103 | 10,513 | 60,590 | 21,997 | |||||||||||
Net (loss) income before income tax expense | (135,542 | ) | 29,058 | (42,523 | ) | 195,836 | |||||||||
Income tax (benefit) expense | (24,676 | ) | 6,770 | (3,412 | ) | 43,225 | |||||||||
Net (loss) income | (110,866 | ) | 22,288 | (39,111 | ) | 152,611 | |||||||||
Net income attributable to non-controlling interests | (342 | ) | (1,028 | ) | (3,810 | ) | (2,998 | ) | |||||||
Net loss (income) attributable to non-controlling interests of | 12,342 | (2,609 | ) | 4,329 | (18,669 | ) | |||||||||
Net (loss) income attributable to | $ | (98,866 | ) | $ | 18,651 | $ | (38,592 | ) | $ | 130,944 | |||||
Net (loss) earnings per share of Class A common stock – basic | $ | (6.89 | ) | $ | 1.32 | $ | (2.69 | ) | $ | 9.44 | |||||
Net (loss) earnings per share of Class A common stock – diluted | $ | (6.89 | ) | $ | 1.28 | $ | (2.69 | ) | $ | 9.13 | |||||
Basic weighted-average shares of Class A common stock outstanding | 14,360 | 14,132 | 14,328 | 13,877 | |||||||||||
Diluted weighted-average shares of Class A common stock outstanding | 14,360 | 14,618 | 14,328 | 14,337 |
CONDENSED CONSOLIDATED BALANCE SHEETS ($ in thousands, except par value and share data) (Unaudited) | |||||||
ASSETS | |||||||
Cash | $ | 84,648 | $ | 42,071 | |||
Restricted cash | 8,662 | 18,876 | |||||
Accounts receivable, net | 113,175 | 57,960 | |||||
Inventories, net | 609,616 | 372,959 | |||||
Prepaid expenses and other current assets | 65,798 | 75,024 | |||||
Total current assets | 881,899 | 566,890 | |||||
Property and equipment, net | 81,532 | 109,713 | |||||
Operating lease right-of-use assets | 135,667 | 123,955 | |||||
Other long-term assets | 6,069 | 3,378 | |||||
Deferred tax assets, net | 35,066 | 8,433 | |||||
Intangible assets, net | 212,324 | 306,471 | |||||
336,602 | 378,588 | ||||||
Total assets | $ | 1,689,159 | $ | 1,497,428 | |||
LIABILITIES | |||||||
Accounts payable | $ | 27,113 | $ | 27,306 | |||
Other payables and accrued expenses | 54,826 | 55,237 | |||||
Customer deposits | 51,649 | 65,460 | |||||
Notes payable – floor plan | 489,024 | 267,108 | |||||
Current portion of operating lease liabilities | 14,568 | 12,981 | |||||
Current portion of long-term debt, net | 29,324 | 21,642 | |||||
Current portion of tax receivable agreement liability | 2,447 | 2,363 | |||||
Total current liabilities | 668,951 | 452,097 | |||||
Other long-term liabilities | 13,693 | 23,174 | |||||
Tax receivable agreement liability | 40,688 | 43,991 | |||||
Long-term operating lease liabilities | 123,310 | 112,127 | |||||
Long-term debt, net | 428,439 | 421,162 | |||||
Total liabilities | 1,275,081 | 1,052,551 | |||||
STOCKHOLDERS’ EQUITY | |||||||
Total stockholders’ equity attributable to | 358,609 | 385,325 | |||||
Equity attributable to non-controlling interests | 55,469 | 59,552 | |||||
Total stockholders’ equity | 414,078 | 444,877 | |||||
Total liabilities and stockholders’ equity | $ | 1,689,159 | $ | 1,497,428 |
Reconciliation of Non-GAAP Financial Measures (amounts in thousands, except per share data) (Unaudited) | |||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Net (loss) income attributable to | $ | (98,866 | ) | $ | 18,651 | $ | (38,592 | ) | $ | 130,944 | |||||
Transaction costs | 171 | — | 2,566 | — | 1,839 | — | 7,724 | ||||||||
Intangible amortization | 3,474 | 2,924 | 13,436 | 7,515 | |||||||||||
Change in fair value of contingent consideration | (2,367 | ) | (642 | ) | (1,604 | ) | 10,380 | ||||||||
Loss on impairment | 147,402 | — | 147,402 | — | |||||||||||
Other expense (income), net | 1,418 | 3,302 | 953 | 3,793 | |||||||||||
Net (loss) income attributable to non-controlling interests of | (13,659 | ) | (742 | ) | (14,744 | ) | (2,676 | ) | |||||||
Adjustments to income tax (benefit) expense (2) | (31,381 | ) | (1,704 | ) | (33,875 | ) | (6,149 | ) | |||||||
Adjusted net income attributable to | 6,192 | 24,355 | 74,815 | 151,531 | |||||||||||
Net (loss) earnings per share of Class A common stock - diluted | $ | (6.89 | ) | $ | 1.28 | $ | (2.69 | ) | $ | 9.13 | |||||
Transaction costs | 0.01 | 0.18 | 0.13 | 0.54 | |||||||||||
Intangible amortization | 0.24 | 0.20 | 0.94 | 0.52 | |||||||||||
Change in fair value of contingent consideration | (0.16 | ) | (0.04 | ) | (0.11 | ) | 0.72 | ||||||||
Loss on impairment | 10.27 | — | 10.29 | — | |||||||||||
Other expense (income), net | 0.10 | 0.23 | 0.07 | 0.26 | |||||||||||
Net (loss) income attributable to non-controlling interests of | (0.95 | ) | (0.05 | ) | (1.03 | ) | (0.19 | ) | |||||||
Adjustments to income tax (benefit) expense (2) | (2.19 | ) | (0.12 | ) | (2.36 | ) | (0.43 | ) | |||||||
Adjustment for dilutive shares (3) | (0.01 | ) | — | (0.14 | ) | — | |||||||||
Adjusted earnings per share of Class A common stock - diluted | $ | 0.42 | $ | 1.68 | $ | 5.10 | $ | 10.55 | |||||||
(1) Represents an allocation of the impact of reconciling items to our non-controlling interest at a rate of 9.1%. | |||||||||||||||
(2) Represents an adjustment of all reconciling items at an effective tax rate of 23%. | |||||||||||||||
(3) Represents an adjustment for shares that are anti-dilutive for GAAP earnings per share but are dilutive for adjusted earnings per share. |
Reconciliation of Non-GAAP Financial Measures (amounts in thousands, except per share data) (Unaudited) | |||||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||
Net (loss) income | $ | (110,866 | ) | $ | 22,288 | $ | (39,111 | ) | $ | 152,611 | |||||
Interest expense – other | 9,292 | 5,264 | 34,557 | 13,201 | |||||||||||
Income tax (benefit) expense | (24,676 | ) | 6,770 | (3,412 | ) | 43,225 | |||||||||
Depreciation and amortization | 7,662 | 5,483 | 26,788 | 16,297 | |||||||||||
Change in fair value of contingent consideration | (2,367 | ) | (642 | ) | (1,604 | ) | 10,380 | ||||||||
Loss on extinguishment of debt | — | 356 | — | 356 | |||||||||||
Transaction costs | 171 | 2,566 | 1,839 | 7,724 | |||||||||||
Loss on impairment | 147,402 | — | 147,402 | — | |||||||||||
Other expense (income), net | 1,418 | 3,302 | 953 | 3,793 | |||||||||||
Adjusted EBITDA | $ | 28,036 | $ | 45,387 | $ | 167,412 | $ | 247,587 | |||||||
Long-term debt (including current portion) | $ | 457,763 | $ | 442,804 | |||||||||||
Less: cash | (84,648 | ) | (42,071 | ) | |||||||||||
Adjusted long-term net debt | $ | 373,115 | $ | 400,733 | |||||||||||
Pro forma adjusted net debt leverage ratio | 2.2 | x | 1.6 | x | |||||||||||
About
Non-GAAP Financial Measures and Key Performance Indicators
This press release and our related earnings call contain certain non-GAAP financial measures, including Adjusted EBITDA, Adjusted Net Income Attributable to
Adjusted EBITDA
We define Adjusted EBITDA as net income (loss) before interest expense – other, income tax expense, depreciation and amortization and other (income) expense, further adjusted to eliminate the effects of items such as the change in fair value of contingent consideration, gain (loss) on extinguishment of debt and transaction costs. See reconciliation above.
Our board of directors, management team and lenders use Adjusted EBITDA to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense), asset base (such as depreciation and amortization) and other items (such as the change in fair value of contingent consideration, gain or loss on extinguishment of debt and transaction costs) that impact the comparability of financial results from period to period. We present Adjusted EBITDA because we believe it provides useful information regarding the factors and trends affecting our business in addition to measures calculated under GAAP. Adjusted EBITDA is not a financial measure presented in accordance with GAAP. We believe that the presentation of this non-GAAP financial measure will provide useful information to investors and analysts in assessing our financial performance and results of operations across reporting periods by excluding items we do not believe are indicative of our core operating performance.
Adjusted Net Income Attributable to
We define Adjusted Net Income Attributable to
Our board of directors, management team and lenders use Adjusted Net Income Attributable to
Adjusted Long-Term Net Debt
We define Adjusted Long-Term Net Debt as long-term debt (including current portion) less cash. We consider, and we believe certain investors and analysts consider, adjusted long-term net debt, as well as adjusted long-term net debt divided by trailing twelve-month Adjusted EBITDA, to be an indicator of our financial leverage.
Same-Store Sales
We define same-store sales as sales from our Dealership segment, excluding new and acquired stores. New and acquired stores become eligible for inclusion in the comparable store base at the end of the store’s thirteenth month of operations under our ownership and revenues are only included for identical months in the same-store base periods. Stores relocated within an existing market remain in the comparable store base for all periods. Additionally, amounts related to closed stores are excluded from each comparative base period. We use same-store sales to assess the organic growth of our Dealership segment revenue on a same-store basis. We believe that our assessment on a same-store basis represents an important indicator of comparative financial results and provides relevant information to assess our performance.
Cautionary Statement Concerning Forward-Looking Statements
This press release and statements made during the above referenced conference call may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including regarding our strategy, future operations, financial position, prospects, plans and objectives of management, growth rate and its expectations regarding future revenue, operating income or loss or earnings or loss per share. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “will be,” “will likely result,” “should,” “expects,” “plans,” “anticipates,” “could,” “would,” “foresees,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential,” “outlook” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. These forward-looking statements are not guarantees of future performance, but are based on management's current expectations, assumptions and beliefs concerning future developments and their potential effect on us, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. Our expectations expressed or implied in these forward-looking statements may not turn out to be correct.
Important factors, some of which are beyond our control, that could cause actual results to differ materially from our historical results or those expressed or implied by these forward-looking statements include the following: effects of industry wide supply chain challenges including a heightened inflationary environment and our ability to maintain adequate inventory, changes in demand for our products and services, the seasonality and volatility of the boat industry, fluctuation in interest rates, adverse weather events, our acquisition and business strategies, the inability to comply with the financial and other covenants and metrics in our credit facilities, cash flow and access to capital, effects of the COVID-19 pandemic on the Company’s business, risks related to the ability to realize the anticipated benefits of any proposed acquisitions, including the risk that proposed acquisitions will not be integrated successfully, the timing of development expenditures, and other risks. More information on these risks and other potential factors that could affect our financial results is included in our filings with the
Investor or Media Contact:
Chief Financial Officer
IR@OneWaterMarine.com
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