OneWater Marine's Q1 Earnings & Revenues Top Estimates, Stock Up

Malibu Boats, Inc. MBUU reported second-quarter fiscal 2025 results, with earnings and revenues beating the Zacks Consensus Estimate. The top and bottom lines declined on a year-over-year basis.

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During the quarter, the company navigated a challenging marine market by leveraging its strong brand portfolio and industry-leading innovation while maintaining a strategic focus on dealer health. While the Year-End Sales event and early-season boat shows delivered moderate results, demand recovery heading into the selling season has been less robust than anticipated. Malibu Boats plans to monitor in-season shows to assess consumer interest. It remains cautious about near-term market conditions.

MBUU’s Q2 Earnings & Revenues

During the fiscal second quarter, the company reported adjusted earnings per share (EPS) of 31 cents, beating the Zacks Consensus Estimate of 21 cents. In the prior-year quarter, MBUU reported an EPS of 57 cents.

Quarterly revenues of $200.3 million beat the Zacks Consensus Estimate of $191 million by 5.1%. However, the top line declined 5.1% on a year-over-year basis. The downside can be attributed to lower unit volumes in the Malibu and Saltwater Fishing segments due to reduced wholesale shipments. However, this was partially offset by a favorable model mix in these segments and inflation-driven year-over-year price increases.

Malibu Boats, Inc. Price, Consensus and EPS Surprise

Malibu Boats, Inc. price-consensus-eps-surprise-chart | Malibu Boats, Inc. Quote

Malibu Boats Segmental Performance

During the fiscal second quarter, net sales in the Malibu segment decreased 3% year over year to $74.1 million. The downside was mainly driven by lower unit volumes, partially offset by a favorable model mix and inflation-driven price increases.

Net sales in the Saltwater Fishing segment declined 15.2% year over year to $70.2 million. Decreased units owing to lower wholesale shipments and retail activity primarily caused the downside.

During the quarter, revenues from the Cobalt segment increased 7.8% year over year to $56 million. The upside was driven by an increase in units and inflation-driven year-over-year price increases.

MBUU Operating Highlights

During the fiscal second quarter, selling and marketing expenses inched up 6.7% year over year to $6 million. The increase was mainly due to a rise in marketing events. As a percentage of sales, selling and marketing expenses increased 30 basis points to 3.0%.

General and administrative expenses during the quarter came in at $26.5 million compared with $15.4 million reported in the prior-year quarter. The increase was driven by legal fees, incentive pay, salaries and stock-based compensation expenses.

Operating income during the quarter came in at $3.2 million compared with $14.7 million reported in the prior-year quarter.

Adjusted EBITDA during the quarter came in at $16.9 million compared with $22.9 million reported in the prior year quarter. Adjusted EBITDA margin in the fiscal second quarter came in at 8.4% compared with 10.9% reported in the year-ago period.

MBUU’s Balance Sheet

Cash as of Dec. 31, 2024, totaled $35.1 million compared with $26.9 million on June 30, 2024.

Inventory during the quarter came in at $144.9 million compared with $145.6 million as of June 30, 2024.

As of Dec. 31, 2024, the company reported long-term debt of $23 million.

MBUU’s Fiscal 2025 Outlook

For fiscal 2025, the company expects the net sales percentage to be flat to down low single digits on a year-over-year basis. The company expects fiscal 2025 Adjusted EBITDA margin to be approximately 10%.

MBUU’s Zacks Rank

Malibu Boats currently carries a Zacks Rank #2 (Buy).

Other Stocks to Consider

Some other top-ranked stocks in the Zacks Consumer Discretionary sector are:

Trip.com Group Limited TCOM sports a Zacks Rank #1 (Strong Buy) at present. TCOM delivered a trailing four-quarter earnings surprise of 42.8%, on average. The stock has gained 12.7% in the past three months. You can see the complete list of today’s Zacks Rank #1 stocks here.

The Zacks Consensus Estimate for TCOM’s 2025 sales and EPS indicates growth of 15.1% and 7.4%, respectively, from the year-ago levels.

JAKKS Pacific, Inc. JAKK currently sports a Zacks Rank #1. JAKK delivered a trailing four-quarter earnings surprise of negative 75.9%, on average. The stock has gained 1% in the past three months.

The Zacks Consensus Estimate for JAKK’s 2025 sales indicates growth of 1.9% from the year-ago levels.

Carnival Corporation & plc CCL currently carries a Zacks Rank #2. CCL has a trailing four-quarter earnings surprise of 326.4%, on average. The stock has surged 26.8% in the past three months.

The Zacks Consensus Estimate for CCL’s 2025 sales and EPS indicates growth of 4% and 23.9%, respectively, from the year-ago levels.

Zacks Investment Research

OneWater Marine CEO Austin Singleton says on a call with analysts that boat sales during its F1Q, which ended Dec. 31, were very strong. The company relied on promotions to gain market share and reduce inventories, which fell 10% from last year. Margins also declined, though overall revenue grew 3% and same-store sales rose 4%. Singleton says the better-than-expected quarter was a pleasant surprise, but he notes the boating industry isn't out of the woods just yet. "The industry continues to face uncertainty after a challenging 2024, and we have not seen any significant market changes that would alter our outlook for the year," he says. Shares jump 16%. (connor.hart@wsj.com)

By Connor Hart

Shares of OneWater Marine climbed after the company posted fiscal first-quarter results that beat expectations.

The stock was up 16%, to $17.88. Despite their gain Thursday, shares are down 32% in the past year.

The Buford, Ga., boat retailer before the bell reported a net loss of $13.6 million, or 81 cents a share, for its three months ended Dec. 31, compared with a loss of $8 million, or 49 cents a share, a year earlier.

On an adjusted basis, the company posted a loss of 54 cents a share. Analysts had been expecting a loss of 89 cents a share, according to FactSet.

Revenue increased 3.2% to $375.8 million, beating the $338.6 million that analysts had forecast.

Sales of new boats rose 2.9%, to $248 million, while sales of pre-owned boats jumped 6.6%, to $56.8 million.

Chief Executive Austin Singleton said the company significantly outpaced the industry as same-store sales rose 4%, driven by a push to gain market share and reduce inventory, which was down 10% from last year.

Singleton said he remains cautiously optimistic on the outlook for the remainder of fiscal 2025, citing the company's lower inventory levels and ongoing cost reduction initiatives.

OneWater backed its fiscal 2025 outlook, expecting adjusted per-share earnings of $1 to $2, as well as revenue of $1.7 billion to $1.85 billion. Analysts are looking for adjusted earnings of $1.43 a share and revenue of $1.81 billion.

Write to Connor Hart at connor.hart@wsj.com