3Q:24 Consolidated Financial Results: Year-Over-Year (versus 3Q:23)
Net sales were $49.9 million, down 36%. The decrease in net sales was primarily due to a 40% decrease in the number of boats sold during the quarter, partially offset by positive price/mix of 4%, driven by higher gross selling prices. Sales continued to be impacted by soft consumer demand, as dealers tightly manage their inventories to minimize floor plan carrying costs until demand improves. The Company believes its year-over-year comparisons will likely remain soft in the near term.
Gross profit was $9.2 million, down 52%. Gross margin was 18.4%, down 630 basis points. The year-over-year gross margin change reflected lower sales volumes and associated manufacturing cost inefficiencies, coupled with the impact of reinstituting retail incentive programs. Production schedules and labor costs have been adjusted to more closely align with current demand. The Company expects year-over-year changes in gross margin to be less pronounced in the near-term as comparisons to prior year periods become less difficult.
Selling, general and administrative expenses were $5.6 million, down 36%, generally in line with the sales decline, and represented 11.3% of net sales, consistent with the prior year. The decrease in SG&A expenses was due to costs that vary with sales and profitability, such as incentive compensation, sales commissions and warranty expense.
Interest income of $634 thousand decreased due to lower cash balances as a result of the Company’s special dividend paid during the second quarter of 2024.
Income tax provision was $820 thousand, or 19.4% of income before income taxes, down 220 basis points.
Net income and diluted EPS were $3.4 million and $0.10, respectively, down from $10.4 million and $0.30, respectively, in 3Q:23. Net income margin was 6.8%, down 660 basis points.
EBITDA was $4.3 million, down from $13.0 million; EBITDA margin was 8.6%, down 810 basis points.
Balance Sheet, Cash Flow and Capital Allocation
Cash and cash equivalents were $53.5 million at the end of 3Q:24, with no outstanding borrowings under the Company’s $20 million revolving credit facility.
Net cash provided by operating activities and free cash flow were $24.9 million and $21.3 million, respectively, year-to-date through 3Q:24.
Payment of dividends totaled $38.8 million year-to-date through 3Q:24, including a special dividend of $0.70 per share paid during the second quarter. The Board of Directors declared a regular quarterly dividend of $0.14 per share payable on December 10, 2024, to common stockholders of record at the close of business on November 11, 2024.
Conference Call Information
Marine Products Corporation will hold a conference call today, October 24, 2024, at 8:00 a.m. Eastern Time to discuss the results for the quarter. Interested parties may listen in by accessing a