MasterCraft Boat Holdings, Inc.

(Unless otherwise noted, dollars in thousands, except per share data)

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation — The Company’s fiscal year begins July 1 and ends June 30, with the interim quarterly reporting periods consisting of 13 weeks. Therefore, the fiscal quarter end will not always coincide with the date of the end of a calendar month.

The accompanying unaudited condensed consolidated financial statements include the accounts of MasterCraft Boat Holdings, Inc. (“Holdings”) and its wholly owned subsidiaries. Holdings and its subsidiaries collectively are referred to herein as the “Company.” The unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s audited consolidated financial statements for the year ended June 30, 2025, and, in the opinion of management, reflect all adjustments considered necessary to present fairly the Company’s financial position as of March 29, 2026, its results of operations for the three and nine months ended March 29, 2026 and March 30, 2025, its cash flows for the nine months ended March 29, 2026 and March 30, 2025, and its statements of equity for the three and nine months ended March 29, 2026 and March 30, 2025. All adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the applicable rules and regulations of the SEC for financial information have been condensed or omitted pursuant to such rules and regulations. The June 30, 2025 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by U.S. GAAP for complete financial statements. However, management believes that the disclosures in these condensed consolidated financial statements are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in our 2025 Annual Report.

Due to the seasonality of the Company’s business, the interim results are not necessarily indicative of the results that may be expected for the remainder of the fiscal year.

There were no significant changes in, or changes to, the application of the Company’s significant or critical accounting policies or estimation procedures for the three and nine months ended March 29, 2026, as compared with those described in the Company’s audited consolidated financial statements for the fiscal year ended June 30, 2025.

New Accounting Pronouncements Issued But Not Yet Adopted

Income Taxes —ASU No. 2023-09, Improvements to Income Tax Disclosures, requires entities to disclose in their rate reconciliation table additional categories of information about federal, state and foreign income taxes and provide more details about the reconciling items in some categories if items meet a quantitative threshold. Entities would have to provide qualitative disclosures about the new categories. The guidance will require all entities to disclose income taxes paid, net of refunds, disaggregated by federal (national), state and foreign taxes for annual periods and to disaggregate the information by jurisdiction based on a quantitative threshold. The guidance makes several other changes to the disclosure requirements. Entities are required to apply the guidance prospectively, with the option to apply it retrospectively. The guidance is effective for annual periods beginning after December 15, 2024, or fiscal 2026 for the Company. The Company is currently evaluating the impact, if any, that the adoption of this standard will have on financial disclosures.

Income Statement —ASU No. 2024-03, Reporting Comprehensive Income— Expense Disaggregation Disclosures. ASU No. 2024-03, as amended by ASU No. 2025-01, requires public entities to provide disaggregated disclosures of certain categories of expenses on an annual and interim basis, including purchases of inventory, employee compensation, depreciation, and intangibles asset amortization for each income statement line item that contains those expenses. The guidance is effective for annual periods beginning after December 15, 2026, or fiscal 2028 for the Company, and is effective for interim periods within fiscal years beginning after December 15, 2027, or fiscal 2029 for the Company. The Company is currently evaluating the impact, if any, that the adoption of this standard will have on financial disclosures.

REVENUE RECOGNITION

The following tables present the Company's revenue by major product category for each reportable segment:

Contract Liabilities

As of June 30, 2025, the Company had $3.8 million of contract liabilities associated with customer deposits and telematic services. During thenine months ended March 29, 2026, $1.5 million was recognized as revenue. As of March 29, 2026, total contract liabilities associated with customer deposits and telematic services of $4.5 million were reported in Accrued expenses and other current liabilities and Other long-term liabilities on the condensed consolidated balance sheet, and $1.7 million is expected to be recognized as revenue during the remainder of the year ending June 30, 2026.

DISCONTINUED OPERATIONS

On October 18, 2024, the Company completed the sale of its Aviara brand of luxury dayboats and certain related assets (the “Aviara Transaction”). As part of the Aviara Transaction, MarineMax, Inc. (“MarineMax”) paid for select branding and operational assets, including Aviara’s website, tooling, and inventory. MarineMax also assumed Aviara’s customer care, warranty liability and administration. Further, on December 23, 2024, the Company completed the sale of its Aviara manufacturing facility in Merritt Island, Florida (the “Aviara Facility Sale”).

The following table summarizes the operating results of discontinued operations for the following periods:

SHORT-TERM INVESTMENTS

The amortized cost, unrealized gains and losses, and fair value of short-term investments at March 29, 2026 and June 30, 2025 are summarized in the following tables. The Company determined the amortized cost of available-for-sale securities as of March 29, 2026 and June 30, 2025 approximate their fair value because of the short-term nature of the investments.

INVENTORIES

Inventories consisted of the following:

PROPERTY, PLANT, AND EQUIPMENT

Property, plant, and equipment, net consisted of the following:

GOODWILL AND OTHER INTANGIBLE ASSETS

The following table presents the carrying amounts of goodwill as of March 29, 2026 and June 30, 2025 for each of the Company's reportable segments.

The following table presents the carrying amounts of Other intangible assets, net:

Amortization expense related to Other intangible assets, net for each of the three and nine months ended March 29, 2026 and March 30, 2025, was $0.5 million and $1.4 million, respectively. Estimated amortization expense for the fiscal year ending June 30, 2026 is $1.8 million.

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following:

Accrued warranty liability activity was as follows for thenine months ended:

9. COMMITMENTS AND CONTINGENCIES

Agreement and Plan of Merger

On February 5, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among Titan Merger Sub 1, Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company (“Merger Sub I”), Titan Merger Sub 2, LLC, a Delaware limited liability company and a direct wholly owned subsidiary of the Company (“Merger Sub II”), and Marine Products Corporation, a Delaware corporation (“Marine Products”). The Merger Agreement, among other things, provides for the combination of the Company and Marine Products in a stock-and-cash transaction whereby (i) Merger Sub I will merge with and into Marine Products (the “First Merger”), with Marine Products surviving the First Merger as a direct wholly owned subsidiary of the Company, and (ii) immediately following the First Merger, Marine Products will merge with and into Merger Sub II (the “Second Merger” and, together with the First Merger, the “Mergers”), with Merger Sub II surviving the Second Merger as a wholly owned subsidiary of the Company. The transactions contemplated by the Merger Agreement are referred to herein as the “Marine Products Transaction.”

Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the First Merger (the “First Effective Time”), each share of Marine Products common stock, par value $0.10 per share, will be converted into the right to receive 0.232 shares of the Company’s common stock, par value $0.01 per share and $2.43 in cash, without interest.

The Marine Products Transaction is expected to close shortly after our special meeting of shareholders, scheduled on May 12, 2026, subject to approval by both the Company’s and Marine Products’ shareholders and the satisfaction of other customary closing conditions.

Legal Proceedings

The Company is subject to various litigation, claims and proceedings, which have arisen in the ordinary course of business. The Company accrues for litigation, claims and proceedings when a liability is both probable and the amount can be reasonably estimated.

The Company’s accrual for litigation matters is not material. While these matters are subject to inherent uncertainties, management believes that current litigation, claims and proceedings, individually and in aggregate, and after considering expected insurance reimbursements and other contract indemnifications, are not likely to have a material adverse impact on the Company’s financial position, results of operations or cash flows.

LONG-TERM DEBT

On February 5, 2026, the Company entered into a fifth Amendment to its previously existing credit agreement (as amended, the “Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto, which provides the Company with a revolving credit facility up to $75.0 million (the “Revolving Credit Facility”). The Credit Agreement, among other things, expressly permits the Marine Products Transaction, revises certain financial covenants to our previously existing credit agreement, including replacing the fixed charge ratio with an interest coverage ratio, and extends the revolving maturity to 2031.

The Credit Agreement bears interest, at the Company’s option, at either the prime rate plus an applicable margin ranging from 0.25% to 1.00% or at an adjusted term benchmark rate plus an applicable margin ranging from 1.25% to 2.00%, in each case based on the Company’s net leverage ratio. The Company is also required to pay a commitment fee for any unused portion of the Revolving Credit Facility ranging from 0.15% to 0.30% based on the Company’s net leverage ratio. During the three and nine months ended March 29, 2026, the applicable margin for loans accruing interest at the prime rate was 0.25% and the applicable margin for loans accruing interest at the benchmark rate was 1.25%.

As of March 29, 2026 and June 30, 2025, there were no amounts outstanding, and the Company had remaining availability of $75.0 million and $100.0 million, respectively, on the Revolving Credit Facility. The Credit Agreement will mature and remaining amounts outstanding, if any, thereunder will be due and payable on February 5, 2031. As of March 29, 2026, the Company was in compliance with its financial covenants under the Credit Agreement.

INCOME TAXES

The Company’s consolidated interim effective tax rate is based on a current estimate of the annual effective income tax rate adjusted to reflect the impact of discrete items. The differences between the Company’s effective tax rate and the statutory federal tax rate of 21.0% for the first nine months of fiscal 2026 primarily relate to changes in uncertain tax positions, the state tax rate in the overall effective rate, permanent differences that affect the relationship between taxable income and accounting income, partially offset by federal and state credits. During the three months ended March 29, 2026 and March 30, 2025, the Company’s effective tax rate was (7.3%) and 21.6%, respectively. During the nine months ended March 29, 2026, and March 30, 2025, the Company's effective tax rate was 25.0% and 22.4%, respectively. Changes to the Company’s effective tax rate for the three and nine months ended March 29, 2026 compared to the effective tax rate for the same prior year period primarily relate to a decreased benefit of federal and state credits and changes in permanent differences, partially offset by changes in uncertain tax positions.

SHARE-BASED COMPENSATION

The following table presents the components of share-based compensation expense by award type.

Restricted Stock

During the nine months ended March 29, 2026, the Company granted 123,465 restricted stock units (“RSUs”) to the Company’s non-executive directors, officers and certain other key employees. Generally, RSUs vest pro-rata over three years for officers and certain other key employees and overone year for non-executive directors. The Company determined the fair value of the RSUs awarded by using the close price of our common stock as of the date of grant. The weighted average grant date fair value of RSUs granted in thenine months ended March 29, 2026, was $21.11 per share.

The following table summarizes the status of nonvested Restricted Stock Awards and RSUs as of March 29, 2026, and changes during the nine months then ended.

As of March 29, 2026, there was $2.9 million of total unrecognized compensation expense related to nonvested restricted stock. The Company expects this expense to be recognized over a weighted average period of 1.3 years.

Performance Stock Units

Performance stock units (“PSUs”) are a form of long-term incentive compensation awarded to executive officers and certain other key employees designed to directly align the interests of employees to the interests of the Company’s shareholders, and to create long-term shareholder value. The awards will be earned based on the Company’s achievement of certain performance criteria over athree-year performance period. The performance period for the awards commences on July 1 of the fiscal year in which they were granted and continue for a three-year period, ending on June 30 of the applicable year. The probability of achieving the performance criteria is assessed quarterly. Following the determination of the Company’s achievement with respect to the performance criteria, the number of shares awarded is subject to further adjustment based on the application of a total shareholder return (“TSR”) modifier. The grant date fair value is determined based on both the probability assessment of the Company achieving the performance criteria and an estimate of the expected TSR modifier. The TSR modifier estimate is determined using a Monte Carlo Simulation model, which considers the likelihood of numerous possible outcomes of long-term market performance. Compensation expense related to existing nonvested PSUs is recognized ratably over the performance period.

PSUs of 96,751 and 72,303 awarded in fiscal 2025 and fiscal 2026, respectively, have performance criteria set annually over the three-year performance period. This performance criteria is cumulative and is based upon the respective year’s performance compared to budget, which has not yet been established for future performance periods. Therefore, the compensation expense for these awards will not begin until all the key terms and conditions of these awards are known, which will be year three of the performance period.

The following table summarizes the status of nonvested PSUs as of March 29, 2026, and changes during the nine months then ended.

As of March 29, 2026, there wasno unrecognized compensation expense related to nonvested PSUs.

EARNINGS PER SHARE AND COMMON STOCK

The following table sets forth the computation of the Company’s net income (loss) per share:

For the three and nine months ended March 29, 2026, and March 30, 2025, an immaterial number of shares were excluded from the computation of diluted earnings per share as the effect would have been anti-dilutive.

Share Repurchase Program

On July 24, 2023, the Board of the Company authorized a share repurchase program under which the Company may repurchase up to $50.0 million of its outstanding shares of common stock. During the three months ended March 29, 2026, the Company didnot repurchase any shares of its common stock. During the three months ended March 30, 2025, the Company repurchased 41,088 shares of common stock for $0.7 million, in cash, excluding related fees and expenses. During the nine months ended March 29, 2026 and March 30, 2025, the Company repurchased 116,370 shares and 264,310 shares of common stock for $2.3 million and $5.0 million, respectively, in cash, excluding related fees and expenses. As of March 29, 2026, $23.5 million remained available under the program.

14. SEGMENT INFORMATION

Reportable Segments

Operating segments are identified as components of an enterprise about which discrete financial information is available for evaluation by the CODM in making decisions on how to allocate resources and assess performance. For the three and nine months ended March 29, 2026, the Company’s CODM regularly assessed the operating performance of the Company’s boat brands undertwo operating and reportable segments:

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The MasterCraft segment, consisting of our MasterCraft brand, produces boats at its Vonore, Tennessee facility. These are premium recreational performance sport boats primarily used for water skiing, wakeboarding, wake surfing, and general recreational boating.

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The Pontoon segment, consisting of our Crest and Balise brands, produces pontoon boats at its Owosso, Michigan facility. Pontoon boats are primarily used for general recreational boating.

Each segment distributes its products through its own independent dealer network. Each segment also has its own management structure which is responsible for the operations of the segment and is directly accountable to the CODM for the operating performance of the segment, which is regularly assessed by the CODM who allocates resources based on that performance.

The Company files a consolidated income tax return and does not allocate income taxes and other corporate-level expenses, including interest, to operating segments. All material corporate costs are included in the MasterCraft segment.

Selected financial information for the Company’s reportable segments was as follows:

(1)

Operating expenses include selling and marketing expenses, general and administrative expenses, and amortization of other intangible assets.

(2)

Adjustment items include share-based compensation, senior leadership transition and organizational realignment costs, consulting costs related to the implementation of our enterprise resource planning system (“ERP implementation costs”), and business development consulting costs and debt extinguishment costs related to the Marine Products Transaction.

The following table presents total assets for the Company’s reportable segments.