Marine Products Corporation Reports 2009 Fourth Quarter and Annual Financial Results

Jan 27, 2010, 07:20 ET from Marine Products Corporation

ATLANTA, Jan. 27 /PRNewswire-FirstCall/ -- Marine Products Corporation (NYSE: MPX) announced its unaudited results for the quarter and year ended December 31, 2009.  Marine Products is a leading manufacturer of fiberglass boats under two brand names: sterndrive and inboard pleasure boats by Chaparral, including Premiere Sport Yachts, SSi Wide Techs, SSX Bowriders, Sunesta Wide Techs and Xtremes, Signature Cruisers, and outboard sport fishing boats by Robalo.  

For the quarter ended December 31, 2009, Marine Products generated net sales of $13,313,000, a 41.5 percent decrease compared to $22,764,000 last year.  The decrease in net sales was due to a 37.8 percent decrease in the number of boats sold and a 5.8 percent decrease in the average selling price per boat.  Units sold decreased among all of our product lines, as we operated at very low production levels in response to weak industry conditions.  The decrease in average selling price per boat was caused by an unfavorable model mix of smaller boats sold during the quarter compared to the prior year.  Gross profit for the quarter was $933,000, or 7.0 percent of net sales, compared to $2,350,000, or 10.3 percent of net sales, in the prior year.  Gross profit as a percentage of net sales declined compared to the prior year due to cost inefficiencies resulting from lower production volumes.

Operating loss for the quarter was $4,756,000 compared to an operating loss of $1,831,000 in the fourth quarter of last year, due to lower gross profit and higher selling, general and administrative expenses.  Selling, general and administrative expenses in the fourth quarter of 2009 increased by 36.1 percent compared to the prior year due to estimated costs to be incurred to support our dealers in their continuing efforts to sell their remaining field inventory relating to prior model years.  This increase was partially offset by lower expenses that vary with sales and profitability and the impact of continued cost management.

Net loss for the quarter ended December 31, 2009 was $2,764,000 compared to a net loss of $1,126,000 in the prior year.  Loss per share for the quarter was $0.08 compared to $0.03 loss per share in the prior year.  

Net sales for the twelve months ended December 31, 2009 were $48,471,000, a 72.4 percent decrease compared to the year ended December 31, 2008.  Net loss for the twelve-month period was $10,693,000 or $0.30 loss per share compared to net income of $7,586,000 or $0.21 diluted earnings per share in the prior year.  

Richard A. Hubbell, Marine Products' Chief Executive Officer stated, "During the third quarter of 2009 we introduced our 2010 models to the market, and provided support to our dealers as they continue with their successful efforts to liquidate old inventory in preparation to sell updated products manufactured during the current model year.  The winter boat show season has begun, and early indications are that attendance and sales are similar to or slightly higher than last year. Also, the availability of floorplan financing, the lack of which was a significant impediment during the boat show season in 2009, has improved for our financially stable dealers.  

"At the end of 2009, our field inventories were slightly more than one-third of the prior year's field inventories.  We do not believe that there will be any additional impact on our financial results of further financial support of our dealer network to liquidate prior year inventories.  In this environment of historically low dealer inventories, we are uniquely positioned to meet dealer and customer demand for new products and adjust production appropriately.  By the end of the first quarter, our unit production will be almost 100 percent higher than in the third and fourth quarters of 2009 to satisfy current dealer demand for 2010 models.  There are many signs confirming that this cycle has bottomed, and we will leverage our financial strength, our position with our dealers, and our fleet of updated models to serve our dealers and customers during 2010," concluded Hubbell.

Marine Products Corporation will hold a conference call today, January 27, 2010 at 8:00 a.m. EST to discuss the results of the fourth quarter and full year.  Interested parties may listen in by accessing a live webcast in the investor relations section of Marine Products' Web site at www.marineproductscorp.com.  The live conference call can also be accessed by calling (888) 857-6930 or (719) 325-2199 and using the access code #5747688.

A replay of the conference call will be available in the investor relations section of Marine Products' Web site (www.marineproductscorp.com) beginning approximately two hours after the call.  

Marine Products Corporation (NYSE: MPX) designs, manufactures and distributes premium-branded Chaparral sterndrive and inboard pleasure boats; Premiere Sport Yachts; and Robalo sport fishing boats, and continues to diversify its product line through product innovation and is prepared to consider strategic acquisition targets.  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 regarding our conclusion that reports of attendance and sales at the early winter boat shows are similar to or slightly higher than last year; our belief that the availability of floorplan financing has improved for our financially stable dealers; our belief that there will not be any additional impact on our financial results of further financial support of our dealer network to liquidate prior year inventories; our belief that we are prepared to meet dealer and customer demand for new products with increased production; our belief that by the end of our first quarter our unit production will be almost 100 percent higher than in the third and fourth quarters of 2009 to satisfy current dealer demand for 2010 models, our belief that many signs confirm that the market cycle in our industry has bottomed, and that we are uniquely positioned to leverage our financial strength, our position with our dealers, and our fleet of updated models to increase our production and serve our dealers and customers during 2010, and our belief that we are prepared to capitalize on opportunities to increase our market share and 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, 2008.

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

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

Periods ended December 31, (Unaudited)

    Fourth Quarter

Twelve Months

       2009

       2008

% BETTER

(WORSE)

       2009

       2008

   % BETTER (WORSE)

Net Sales

$

13,313

$

22,764

(41.5)

%

$

48,471

$

175,622

(72.4)

%

Cost of Goods Sold

12,380

20,414

39.4

45,996

143,677

68.0

Gross Profit

933

2,350

(60.3)

2,475

31,945

(92.3)

Selling, General and Administrative Expenses

5,689

4,181

(36.1)

21,638

23,146

6.5

Operating (Loss) Income

(4,756)

(1,831)

(159.7)

(19,163)

8,799

N/M

Interest Income

406

605

(32.9)

1,663

2,420

(31.3)

(Loss) Income Before Income Taxes

(4,350)

(1,226)

N/M

(17,500)

11,219

N/M

Income Tax (Benefit) Provision

(1,586)

(100)

N/M

(6,807)

3,633

N/M

Net (Loss) Income

$

(2,764)

$

(1,126)

(145.5)

%

$

(10,693)

$

7,586

N/M

%

(LOSS) EARNINGS PER SHARE

  Basic  

$

(0.08)

$

(0.03)

(166.7)

%

$

(0.30)

$

0.21

N/M

%

  Diluted  

$

(0.08)

$

(0.03)

(166.7)

%

$

(0.30)

$

0.21

N/M

%

AVERAGE SHARES OUTSTANDING

  Basic  

36,086

35,825

35,964

35,786

  Diluted  

36,086

35,825

35,964

36,444

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE  SHEETS

At December 31, (Unaudited)

         (in thousands)

       2009

       2008

ASSETS

Cash and cash equivalents

$

2,573

$

4,622

Marketable securities

23,328

8,799

Accounts receivable, net

1,265

5,575

Inventories

19,487

22,453

Income taxes receivable

6,304

2,464

Deferred income taxes

1,008

1,116

Prepaid expenses and other current assets

2,783

1,681

 Total current assets

56,748

46,710

Property, plant and equipment, net

13,310

14,579

Goodwill

3,308

3,308

Other intangibles, net

465

465

Marketable securities

16,117

37,953

Deferred income taxes

3,224

2,934

Other assets

5,077

4,344

 Total assets

$

98,249

$

110,293

LIABILITIES AND STOCKHOLDERS' EQUITY

Accounts payable

$

1,972

$

1,437

Accrued expenses and other liabilities

8,711

12,281

 Total current liabilities

10,683

13,718

Pension liabilities

5,689

5,285

Other long-term liabilities

365

501

 Total liabilities

16,737

19,504

Common stock

3,688

3,643

Capital in excess of par value

-

-

Retained earnings

78,690

88,535

Accumulated other comprehensive loss

(866)

(1,389)

 Total stockholders' equity

81,512

90,789

 Total liabilities and stockholders' equity

$

98,249

$

110,293

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

SOURCE Marine Products Corporation



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