MasterCraft (NASDAQ: MCFT) reported Q2 EPS of $0.43, $0.08 better than the analyst estimate of $0.35. Revenue for the quarter came in at $99.6 million versus the consensus estimate of $86.75 million.

Second Quarter Highlights:

• Net sales for the second quarter decreased to $99.6 million, down 18.0 percent from $121.5 million in the prior-year period.
• GAAP net income was $6.9 million, down 32.5 percent from $10.2 million in the prior-year period.
• GAAP diluted earnings per share decreased in the second quarter by $0.17, or 31.5 percent to $0.37, from the prior year period.
• Diluted Adjusted Net Income per share, a non-GAAP measure, was $0.43 compared to $0.64 in the prior-year period.
• Adjusted EBITDA, a non-GAAP measure, declined 27.2 percent to $13.6 million from $18.6 million in the prior-year period.
• The second Aviara model, the AV36, was launched and began selling during the second quarter.
• During the quarter, the company paid down $8.3 million in long-term debt, including $6.0 million of voluntary prepayments.

Fred Brightbill, Chief Executive Officer, commented, “MasterCraft delivered results slightly ahead of our expectations for the fiscal second quarter as we continued to make progress across a number of our operational focus areas, including efficiently managing our production around the GM strike, further right-sizing our dealer inventory, executing operational excellence initiatives and advancing the start-up of our new Aviara brand. The combination of wholesale production decreases across our segments and strategic retail rebates, in what is the slowest retail quarter of the year, resulted in dealer pipeline right-sizing in-line with our plan. We believe the actions we are taking, coupled with our diverse portfolio of brands and commitment to delivering differentiated, best in class products and experiences for our customers, position us well in the current environment and set us up for renewed growth in fiscal 2021.”

Brightbill continued, “I am excited about the opportunity to lead MasterCraft as CEO. As part of my transition to the permanent CEO role, I spent time collecting valuable feedback from our customers, dealers, employees, business partners, and investors to hear directly from them about their perspectives on MasterCraft’s strengths and future opportunities. With these insights and following a thorough top-to-bottom evaluation of the business, we have implemented a new strategic growth plan with a relentless focus on improving the customer experience, expanding brand awareness, further advancing operational excellence and developing a customer-focused culture, all at minimal incremental cost to the Company. I am confident that with a renewed focus on these initiatives, MasterCraft will be better positioned to increase our share of the boating market across all our brands and generate significant value for the Company and our shareholders.”

Outlook

Said Brightbill, “As we look to the second half of the year, we continue to be pleased by the retail momentum we experienced in the first half of the year, early boat show results and the successful roll-out of our new Aviara brand. Aviara’s strong retail performance to-date reinforces our bullish prospects for the brand this year and beyond. While we are encouraged by the improved industry retail trends to-date, and the progress we see across all our brands, visibility will remain limited until we are further into the retail selling season. Longer-term, we are confident in the strength of our brands and believe the new strategy we are implementing will unlock opportunities to drive profitable growth and increased value creation.”

Given the above-mentioned factors, the company is maintaining its consolidated fiscal 2020 outlook, which is as follows:

• Net Sales – down low-single digit percent
• Adjusted EBITDA Margin – down 50 to 100 basis points
• Adjusted Earnings per Share – down high-single digit percent

For earnings history and earnings-related data on MasterCraft (MCFT) click here.