MasterCraft Boat Holdings Inc
For the period ended Mar 30, 2025. Filed May 7, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 30, 2025 · Filed May 7, 2025
MCFT$20.36-2.0%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-12-29; filed 2025-02-06.
0000950170-25-015130
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-30; filed 2025-05-07.
0000950170-25-065151
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 62 previous paragraphs and 70 current paragraphs.
39 unchanged; 22 reworded; 9 added; 1 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (9)
Current report
Upcoming Leadership Transition
Current report
On April 7, 2025 Timothy M. Oxley, Chief Financial Officer (“CFO”) of the Company, announced his retirement from the Company, effective December 31, 2025. Prior to his retirement, Mr. Oxley will step down as CFO, effective June 30, 2025, at which time, Mr. Oxley will serve as a Special Advisor. Scott Kent, Vice President of Finance, will succeed Mr. Oxley as CFO, effective July 1, 2025.
Current report
Tariff and Trade Environment
Current report
The recently imposed U.S. tariffs did not materially impact our third quarter results, but their effects and the potential imposition of modified or additional tariffs may, among other things, create new trade barriers that disrupt supply chains, raise costs, weaken consumer confidence and impact consumer demand for our products, and impact our ability to export our products, all of which could have an adverse effect on our business and financial results. The extent of the impact of tariffs on the Company’s business is highly uncertain and difficult to predict. While we anticipate a modest impact from tariffs on our fiscal 2025 costs, we are closely monitoring the rapidly evolving tariff landscape and are working diligently with key suppliers to mitigate risks. For additional information regarding the potential impacts of tariffs on our business and results of operations, see “Part I, Item 1A. Risk factors” in our 2024 Annual Report.
Current report
Results of Operations
Current report
We continued to navigate market and economic uncertainty during the third quarter of fiscal 2025 and expect this trend to continue through the end of our fiscal year. Net sales decreased primarily due to planned lower unit volumes to align dealer inventories with retail demand. Gross margin declined due to lower cost absorption driven by decreased production volume.
Current report
Net sales decreased $63.3 million during the first nine months of fiscal 2025, when compared with the same prior-year period. The decrease in net sales was driven by planned lower unit volumes, unfavorable model mix and changes in price, partially offset by favorable option sales.
Current report
Operating expenses decreased $1.2 million and $1.8 million during the third quarter and first nine months of fiscal 2025, respectively, when compared with the same prior-year period. Prior year costs were elevated as a result of CEO transition and related share-based compensation costs.
Current report
Net sales decreased $43.5 million during the first nine months of fiscal 2025, when compared with the same prior-year period. The decrease was driven by lower unit volume, unfavorable model mix and changes in price, partially offset by decreased dealer incentives.
Removed paragraphs (1)
Previous report
As a result of economic and industry headwinds at the end of our key selling season, we adjusted our production levels at the outset of fiscal 2025 to allow for improvements in overall dealer inventory levels. These lower production levels resulted in decreased net sales and reduced gross margins compared to our fiscal 2024 results due to lower fixed cost absorption. As we navigate these headwinds facing our business, we remain committed to aligning our production levels with market demand while also maintaining operational flexibility.
Reworded paragraphs (22)
Previous wording
On October 18, 2024, the Company completed the Aviara Transaction. Further, on December 23, 2024, the Company completed the Aviara Facility Sale. The Company's results for all periods presented, as discussed in Management's Discussion and Analysis, are presented on a continuing operations basis. Results related to our Aviara and NauticStar reporting units are reported as discontinued operations for all periods presented. See Notes 1 and 3 in Notes to the unaudited condensed consolidated financial statements for more information on discontinued operations.
Current wording
On October 18, 2024, the Company completed the Aviara Transaction and on December 23, 2024, the Company completed the Aviara Facility Sale. In fiscal 2023, the Company sold its NauticStar business. The Company's results for all periods presented, as discussed in Management's Discussion and Analysis, are presented on a continuing operations basis. Results related to our Aviara and NauticStar reporting units are reported as discontinued operations for all periods presented. See Notes 1 and 3 in Notes to the unaudited condensed consolidated financial statements for more information on discontinued operations.
Previous wording
The table below presents our consolidated results of operations for the three and six months ended:
Current wording
The table below presents our consolidated results of operations for the three and nine months ended:
Previous wording
Net sales decreased $26.4 million and $55.3 million during the second quarter and first half of fiscal 2025, respectively, when compared with the same prior-year period. The decrease in net sales was primarily driven by planned lower unit volumes and unfavorable model mix.
Current wording
Net sales decreased $8.0 million during the third quarter of fiscal 2025, when compared with the same prior-year period. The decrease in net sales was driven by planned lower unit volumes and changes in price, partially offset by favorable model mix and options sales.
Previous wording
Gross margin percentage declined 610 and 600 basis points during the second quarter and first half of fiscal 2025, respectively, when compared with the same prior-year period. Lower margins were the result of unfavorable model mix and lower cost absorption due to decreased production volume.
Current wording
Gross margin percentage declined 250 and 470 basis points during the third quarter and first nine months of fiscal 2025, respectively, when compared with the same prior-year period. Lower margins were the result of changes in sales price, material and overhead inflation, and lower cost absorption due to decreased production volume.
Previous wording
The following table sets forth MasterCraft segment results for the three and six months ended:
Current wording
The following table sets forth MasterCraft segment results for the three and nine months ended:
Previous wording
Net sales decreased $17.6 million and $37.9 million during the second quarter and first half of fiscal 2025, respectively, when compared with the same prior-year period. The decrease was driven by lower unit volume and unfavorable model mix.
Current wording
Net sales decreased $5.6 million during the third quarter of fiscal 2025, when compared with the same prior-year period. The decrease was driven by lower unit volume and changes in price, partially offset by favorable model mix and decreased dealer incentives.
Previous wording
Operating income decreased $6.9 million and $13.5 million during second quarter and first half of fiscal 2025, respectively, when compared with the same prior-year period. The change was primarily the result of decreased net sales, as discussed above.
Current wording
Operating income decreased $1.8 million and $15.3 million during third quarter and first nine months of fiscal 2025, respectively, when compared with the same prior-year period. The change was primarily the result of decreased net sales and increased materials and overhead inflation, partially offset by decreased operating expenses, as discussed above.
Previous wording
The following table sets forth Pontoon segment results for the three and six months ended:
Current wording
The following table sets forth Pontoon segment results for the three and nine months ended:
Previous wording
Net sales decreased $8.8 million and $17.4 million during the second quarter and first half of fiscal 2025, respectively, when compared to the same prior-year period, mainly due to lower unit volumes and increased dealer incentives.
Current wording
Net sales decreased $2.5 million and $19.9 million during the third quarter and first nine months of fiscal 2025, respectively, when compared to the same prior-year period, mainly due to lower unit volumes and increased dealer incentives, partially offset by favorable model mix and option sales.
Previous wording
Operating loss for the second quarter and first half of fiscal 2025 was $3.2 million and $5.9 million, respectively, compared to operating income of $0.5 million and $0.7 million in the same prior year periods, respectively. The change was primarily the result of decreased net sales, as discussed above.
Current wording
Operating loss for the third quarter and first nine months of fiscal 2025 increased $0.8 million and $7.4 million, respectively, compared to the same prior-year period. The change was driven by decreased net sales, as discussed above, and increased labor and materials costs.
Previous wording
For fiscal 2025 and 2024, income tax expense reflects an income tax rate of 20.0% for each period presented.
Current wording
For fiscal 2025 and 2024, income tax expense reflects an income tax rate of 18.0% and 20.0%, respectively.
Previous wording
Our primary liquidity and capital resource needs are to finance working capital, fund capital expenditures, service our debt, fund potential acquisitions, and fund our share repurchase program. Our principal sources of liquidity are our cash balance, available-for-sale securities, cash generated from operating activities, our revolving credit agreement and the refinancing and/or new issuance of long-term debt. We believe our cash balance, available-for-sale securities, cash from operations, and our ability to borrow will be sufficient to provide for our liquidity and capital resource needs.
Current wording
Our primary liquidity and capital resource needs are to finance working capital, fund capital expenditures, service debt, fund potential acquisitions, and fund our share repurchase program. Our principal sources of liquidity are our cash balance, available-for-sale securities, cash generated from operating activities, our revolving credit agreement and the refinancing and/or new issuance of long-term debt. We believe our cash balance, available-for-sale securities, cash from operations, and our ability to borrow will be sufficient to provide for our liquidity and capital resource needs.
Previous wording
Cash and cash equivalents totaled $34.3 million as of December 29, 2024, an increase of $26.9 million from $7.4 million as of June 30, 2024. The increase includes $26.1 million in net proceeds from the Aviara Facility Sale. Refer to Note 3 — Discontinued Operations in the Notes to the unaudited condensed consolidated financial statements for further details. Available-for-sale securities totaled $28.5 million as of December 29, 2024, a decrease of $50.3 million from $78.8 million as of June 30, 2024. Proceeds from Available-for-sale securities were used to repay outstanding amounts under the Revolving Credit Facility. Refer to Note 4 — Short-term investments in the Notes to the unaudited condensed consolidated financial statements for further details. Total debt as of June 30, 2024, was $49.3 million, with no amounts outstanding as of December 29, 2024.
Current wording
Cash and cash equivalents totaled $28.5 million as of March 30, 2025, an increase of $21.1 million from $7.4 million as of June 30, 2024. Available-for-sale securities totaled $38.0 million as of March 30, 2025, a decrease of $40.8 million from $78.8 million as of June 30, 2024. Net changes in Cash and cash equivalents and Available-for-sale securities include proceeds from Available-for-sale securities being used to repay outstanding amounts under the Revolving Credit Facility and $26.1 million in net proceeds from the Aviara Facility Sale. Refer to Note 3 - Discontinued Operations and Note 4 — Short-term investments in the Notes to the unaudited condensed consolidated financial statements for further details. Total debt as of June 30, 2024 was $49.3 million, with no amounts outstanding as of March 30, 2025.
Previous wording
During the six months ended December 29, 2024, the Company repurchased 223,222 shares of common stock for $4.2 million in cash, excluding related fees and expenses under both plans.
Current wording
During the nine months ended March 30, 2025, the Company repurchased 264,310 shares of common stock for $5.0 million in cash, excluding related fees and expenses.
Previous wording
Six Months Ended December 29, 2024 Cash Flows from Continuing Operations
Current wording
Nine Months Ended March 30, 2025 Cash Flows from Continuing Operations
Previous wording
Net cash provided by operating activities for the six months ended December 29, 2024 was $13.4 million, primarily due to net income and favorable changes to working capital. Working capital is defined as accounts receivable, income tax receivable, inventories, and prepaid expenses and other current assets net of accounts payable, income tax payable, and accrued expenses and other current liabilities as presented in the condensed consolidated balance sheets. Favorable changes in working capital primarily consisted of decreases in accounts receivable and prepaid expenses and other current assets. Partially offsetting favorable changes in working capital were decreases in accrued expenses and other current liabilities and in accounts payables. Accounts receivable decreased due to timing of sales at the end of the period compared to the end of the prior-year period. Prepaid and other current assets decreased due to amortization of insurance premiums. Accrued expenses and other current liabilities decreased due to payment of dealer incentives and variable compensation. Accounts payables decreased due to timing associated with the holiday season.
Current wording
Net cash provided by operating activities for the nine months ended March 30, 2025 was $18.5 million, primarily due to net income and favorable changes to working capital. Working capital is defined as accounts receivable, income tax receivable, inventories, and prepaid expenses and other current assets net of accounts payable, income tax payable, and accrued expenses and other current liabilities as presented in the condensed consolidated balance sheets. Favorable changes in working capital primarily consisted of an increase in accounts payables and a decrease in accounts receivable. Partially offsetting favorable changes in working capital was an increase in inventories. Accounts payables increased due to increased production compared to the prior-year period. Accounts receivable decreased due to timing of sales at the end of the period compared to the end of the prior-year period. Inventories increased due to higher value on finished goods and timing of sales at the end of the period compared to the end of the prior-year period.
Previous wording
Net cash provided by investing activities was $46.3 million, which included $50.9 million of proceeds in available-for-sale securities, partially offset by $4.6 million in capital expenditures. Our capital spending was primarily focused on tooling, information technology, and machinery and equipment.
Current wording
Net cash provided by investing activities was $35.0 million, which included $41.6 million of net proceeds in available-for-sale securities, partially offset by $6.6 million in capital expenditures. Our capital spending was primarily focused on information technology, tooling and machinery and equipment.
Previous wording
Net cash used in financing activities was $54.2 million, which included share repurchases totaling $4.2 million and $49.5 million used to repay outstanding borrowings of the Term Loan. Drawn amounts on the Revolving Credit Facility were fully repaid as of December 29, 2024.
Current wording
Net cash used in financing activities was $55.0 million, which included share repurchases totaling $5.0 million, excluding related fees and expenses, and $49.5 million used to repay outstanding borrowings of the Term Loan. Drawn amounts on the Revolving Credit Facility were fully repaid as of March 30, 2025.
Previous wording
Six Months Ended December 31, 2023 Cash Flows from Continuing Operations
Current wording
Nine Months Ended March 31, 2024 Cash Flows from Continuing Operations
Previous wording
Net cash provided by operating activities for the six months ended December 31, 2023 was $22.4 million, primarily due to net income. Working capital had a net nominal effect on cash provided by operating activities. Favorable working capital changes consisted of decreases in inventories and accounts receivables, partially offset by increases in accounts payable, accrued expenses and other current liabilities, and income tax payable. Inventories decreased as we continue to rebalance inventory levels to align with lower production levels, partially offset by increased materials costs from inflation. Accounts receivables decreased primarily as a result of timing of collections and lower sales at the end of the period compared to the end of the prior-year period. Accounts payable decreased as a result of decreased production levels as well as timing associated with the holiday season. Accrued expenses and other current liabilities decreased due to payment of dealer incentives and lower compensation related accruals, partially offset by an increase in contract liabilities. Income tax payable decreased due to the timing of payments.
Current wording
Net cash provided by operating activities for the nine months ended March 31, 2024 was $23.6 million, primarily due to net income, partially offset by working capital usage. Working capital usage primarily consisted of decreases in accrued expenses and other current liabilities, accounts payable, and income tax payable and an increase in prepaid expenses and other current assets, partially offset by decreases in inventories and accounts receivables. Accrued expenses and other current liabilities decreased due to payment of dealer incentives and lower compensation related accruals, partially offset by an increase in repurchase obligations. Accounts payable decreased as a result of decreased production levels. Income tax payable decreased due to lower earnings compared to the prior year. Prepaid expenses and other current assets increased due to payment of annual insurance premiums. Inventories decreased as we continue to rebalance inventory levels to align with lower production levels, partially offset by increased materials costs from inflation. Accounts receivables decreased primarily as a result of lower sales at the end of the period compared to the end of the prior-year period.
Previous wording
Net cash provided by investing activities was $15.2 million, due to net changes in available-for-sale securities of $20.0 million, partially offset by $4.8 million of capital expenditures. Our capital spending was mainly focused on facility enhancements, information technology, and tooling.
Current wording
Net cash provided by investing activities was $1.8 million, due to net changes in available-for-sale securities of $9.8 million, partially offset by $8.0 million of capital expenditures. Our capital spending was mainly focused on facility enhancements, information technology, and tooling.
Previous wording
Net cash used in financing activities was $14.1 million, which included net payments of $2.3 million on long-term debt and $10.2 million of share repurchases.
Current wording
Net cash used in financing activities was $16.8 million, which included net payments of $3.4 million on long-term debt and $11.7 million of share repurchases.