MasterCraft Boat Holdings, Inc.
For the period ended Jun 30, 2026. Filed Sep 10, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Sep 10, 2026
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-K
Period ended 2025-06-30; filed 2025-08-27.
0000950170-25-111682
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2026-06-30; filed 2026-09-10.
0001193125-26-387432
Item 7. 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 113 previous paragraphs and 123 current paragraphs.
72 unchanged; 18 reworded; 32 added; 23 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 8 previous and 9 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 (32)
Current report
Business Combination
Current report
On May 15, 2026, the Company completed the merger with Marine Products, pursuant to which each share of Marine Products common stock, par value $0.10 per share, was 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, representing total merger consideration of approximately $284.2 million. The transactions of the merger are referred to herein as the “Marine Products Transaction.” Through the transaction, the Company acquired the Chaparral and Robalo brands and established a new Recreation and Sport Fishing reportable segment. The results of Marine Products have been included in the Company’s consolidated financial statements since May 15, 2026. See Note 4 to Consolidated Financial Statements for more information on business combinations.
Current report
Amid an evolving geopolitical and macroeconomic landscape, the Company delivered increased net sales of $64.7 million and increased gross margin of 290 basis points for fiscal 2026, as discussed below.
Current report
Net Sales. Net Sales increased 22.8 percent for fiscal 2026 when compared to fiscal 2025. The increase was a result of incremental net sales of $33.3 million sales generated in our Recreation and Sport Fishing segment as a result of the Marine Products Transaction, increased unit volumes, increased prices, favorable model mix and option sales, and decreased dealer incentives.
Current report
Gross Margin. Gross Margin percentage increased 290 basis points during fiscal 2026 when compared to fiscal 2025. Higher margins were primarily the result of increased net sales, as discussed above, combined with effective cost controls in our Performance and Wake and Leisure segments, partially offset by a $2.6 million inventory step-up charge related to the Marine Products Transaction.
Current report
Interest Income. Interest income decreased $0.7 million during fiscal 2026 primarily due to certain investment securities maturing with proceeds used in connection with funding the Marine Products Transaction.
Current report
Performance and Wake Segment
Current report
The following table sets forth Performance and Wake segment results for the fiscal years ended:
Current report
Net sales increased 12.6 percent during fiscal 2026, when compared to fiscal 2025. The increase was primarily driven by increased unit volumes, favorable model mix and option sales, increased prices, and decreased dealer incentives.
Current report
Operating income increased 4.3 percent during fiscal 2026, when compared to fiscal 2025, driven by increased net sales, as discussed above, partially offset by increased operating and transaction costs of $13.5 million, primarily related to Marine Products Transaction.
Current report
Leisure Segment
Current report
The following table sets forth Leisure segment results for the fiscal years ended:
Current report
Operating losses increased to $16.0 million during fiscal 2026, compared to $9.4 million in fiscal 2025 The change was a result of non-cash impairment charges of $10.1 million related to the Crest brand intangible assets, partially offset by increased net sales, as discussed above, and effective cost controls. See Note 8 for further information related to impairment charges.
Current report
Recreation and Sport Fishing Segment
Current report
The following table sets forth Recreation and Sport Fishing segment results for the fiscal years ended:
Current report
As the segment was newly established in 2026 as a result of the Marine Products Transaction, there are no comparable prior-year results for year-over-year analysis. For the period from May 15, 2026, through June 30, 2026, the segment contributed net sales of $33.3 million and an operating loss of $6.6 million. The operating loss included a $2.6 million inventory step-up charge, $2.9 million of amortization expense for order-backlog and dealer network, and other transaction related costs. See Note 4 to Consolidated Financial Statements for more information on business combinations.
Current report
Represents consulting costs related to the implementation of our enterprise resource planning system.
Current report
Represents non-recurring third-party business development, consulting and legal costs and debt extinguishment costs related to the Marine Products Transaction.
Current report
Represents non-cash charges recorded in our Leisure segment for impairment of other intangible assets. See Note 8 within Notes to the Consolidated Financial Statements for more information on impairment charges.
Current report
(e)
Current report
Represents an inventory step-up charge related to the Marine Products Transaction.
Current report
(f)
Current report
(g)
Current report
In connection with the Marine Products Transaction, the Company temporarily borrowed approximately $25.0 million under the Revolving Credit Facility to ensure liquidity during the transaction closing process. The outstanding balance was subsequently repaid prior to June 30, 2026. Accordingly, as of June 30, 2026 and 2025, we had no long-term debt outstanding and $75 million and $100.0 million, respectively, available borrowing capacity under the Revolving Credit Facility. Refer to Note 10 – Long-Term Debt in the Notes to Consolidated Financial Statements for further details.
Current report
Net cash used in investing activities was $11.4 million, which included $54.1 million for business combinations, net of cash acquired, and $8.1 million in capital expenditures, partially offset by net proceeds of $50.8 million from available-for-sale securities. Our capital spending was primarily focused on tooling, machinery and equipment, and information technology.
Current report
Net cash used in financing activities was $4.2 million, which included share repurchases totaling $2.3 million, excluding related fees and expenses. In connection with the Marine Products Transaction, the Company temporarily borrowed approximately $25.0 million under the Revolving Credit Facility to ensure liquidity during the transaction closing process. The outstanding balance was subsequently repaid prior to June 30, 2026.
Current report
Related Party Transactions
Current report
See Note 14 – Related Party Transactions in the accompanying Notes to Consolidated Financial Statements for further information.
Current report
As of June 30, 2026, the Company had goodwill balances associated with the Performance and Wake reporting unit and the Recreation and Sport Fishing reporting unit. The Company performed a qualitative assessment of each reporting unit, as appropriate, and concluded that the fair value of each exceeded its carrying value.
Current report
During the fiscal 2026 fourth quarter, the Company identified indicators of impairment related to the Crest brand intangible assets within the Leisure segment and performed impairment analyses for both the Crest dealer network and Crest trade name. The dealer network was evaluated for recoverability using an undiscounted cash flows analysis and, because the carrying value was not recoverable, its fair value was determined using a discounted cash flow approach. The Crest trade name was tested for impairment by comparing its estimated fair value, determined using the relief-from-royalty method, to its carrying value. Based on these analyses, the Company concluded that the carrying values of both the Crest dealer network and Crest trade name exceeded their respective fair values. As a result, the Company recorded impairment charges of $4.1 million and $6.0 million related to the Crest dealer network and Crest trade name, respectively, reducing the assets to their estimated fair values.
Current report
Business Combinations — We allocate the purchase price of acquired businesses to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values at the acquisition date. Significant judgment is required in estimating the fair value of acquired intangible assets, including dealer networks and trade names. These valuations are based on discounted cash flow models and other valuation techniques that utilize significant assumptions, including forecasted revenues, customer attrition rates, royalty rates and discount rates. Changes in these assumptions could materially impact the fair value assigned to acquired assets, the amount of goodwill recognized and future amortization and impairment expense.
Current report
The Company has evaluated the accounting policies of Marine Products following the acquisition and determined that they are substantially consistent with those of the Company. Certain differences in accounting processes, estimates, and reporting practices identified during the integration process are being conformed to the Company's policies and procedures and are not expected to have a material impact on the Company's consolidated financial statements.
Removed paragraphs (23)
Previous report
Leadership Transition
Previous 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 stepped down as CFO, effective June 30, 2025, at which time, Mr. Oxley began serving as a Special Advisor. Scott Kent, Vice President of Finance, succeeded Mr. Oxley as CFO, effective July 1, 2025.
Previous report
Tariff and Trade Environment
Previous report
The recently imposed U.S. tariffs did not materially impact our fiscal 2025 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. 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 Item 1A “Risk Factors — Risks Relating to Our Regulatory, Accounting, Legal, and Tax Environment.”
Previous report
Fiscal 2025 was impacted by anticipated market and economic uncertainty. Net sales decreased primarily due to planned lower unit volumes aimed at aligning dealer inventories with retail demand. Gross margin declined due to lower cost absorption driven by decreased production volume.
Previous report
Net Sales. Net Sales decreased 11.8 percent for fiscal 2025 when compared to fiscal 2024. The decrease was a result of planned lower unit volumes and changes in price, partially offset by favorable model mix related to new product introductions, favorable option sales, and decreased dealer incentives.
Previous report
Gross Margin. Gross Margin percentage declined 220 basis points during fiscal 2025 when compared to fiscal 2024. Lower margins were the result of lower cost absorption due to decreased production volume, material and overhead inflation, and changes in sales price.
Previous report
Interest Income. Interest income decreased $2.3 million during fiscal 2025 primarily due to certain investment securities being sold to repay outstanding borrowings under the Revolving Credit Facility during the second quarter of fiscal 2025.
Previous report
MasterCraft Segment
Previous report
The following table sets forth MasterCraft segment results for the fiscal years ended:
Previous report
Net sales decreased 8.4 percent during fiscal 2025, when compared to fiscal 2024. The decrease was primarily driven by lower unit volumes and changes in price, partially offset by favorable model mix, decreased dealer incentives, and favorable option sales.
Previous report
Operating income decreased 30.1 percent during fiscal 2025, when compared to the same prior year period. The overall decrease was driven by decreased net sales, as discussed above, increased materials and overhead inflation, and increased variable compensation costs.
Previous report
Pontoon Segment
Previous report
The following table sets forth Pontoon segment results for the fiscal years ended:
Previous report
Operating loss was $9.4 million during fiscal 2025, compared to $2.1 million in fiscal 2024. The change was primarily due to decreased net sales, as discussed above, and increased labor and materials cost.
Previous report
Represents non-recurring third-party costs associated with business development activities, primarily relating to consulting costs for evaluation and execution of internal growth and other strategic initiatives. The evaluation and execution of the internal growth and other strategic initiatives is a bespoke initiative, and the costs associated therewith do not constitute normal recurring cash operating expenses necessary to operate the Company’s business.
Previous report
As of June 30, 2025, we had no amounts outstanding under the Revolving Credit Facility, leaving $100.0 million of available borrowing capacity. Refer to Note 9 — Long-Term Debt in the Notes to Consolidated Financial Statements for further details.
Previous report
Net cash provided by operating activities was $12.2 million, primarily due to net income, partially offset by changes in working capital as defined above. Changes in working capital primarily consisted of a decrease in accrued expenses and other current liabilities, accounts payable, and income tax payable, partially offset by a decrease in inventories and accounts receivable. Accrued expenses and other current liabilities decreased as a result of lower compensation related accruals, warranty costs as a result of reduced unit volumes, and reduced volume rebates, offset by an increase in retail rebates. Accounts payable decreased as a result of decreased production levels. Income tax payable decreased due to the lower earnings compared to the prior year. Inventories decreased as we rebalanced inventory levels to align with lower production levels. Accounts receivable decreased due to reduced unit volumes.
Previous report
Net cash provided by investing activities was $4.1 million, due to net proceeds in short-term investments of $14.6 million, partially offset by $10.5 million of capital expenditures. Our capital spending was focused on facility enhancements, information technology, and tooling.
Previous report
Net cash used in financing activities was $23.1 million, which included net payments of $4.5 million on long-term debt and $16.3 million of share repurchases.
Previous report
As of June 30, 2025, only the MasterCraft reporting unit has a goodwill balance. The Company performed a qualitative assessment and concluded the fair value of the MasterCraft reporting unit is “more likely than not” greater than its carrying value.
Previous report
During the fiscal 2025 fourth quarter, the Company determined certain indicators of potential impairment existed for the Crest brand intangible assets, resulting in an undiscounted cash flows analysis for the Crest dealer network and a discounted cash flows analysis for the Crest trade name. The analysis concluded both the undiscounted cash flows and fair value exceeded their related carrying values, respectively, resulting in no impairment.
Previous report
Income Taxes—We are subject to income taxes in the United States of America and the United Kingdom. For fiscal 2025 and 2024, our effective tax rate differs from the statutory rate, primarily due to the inclusion of the state tax rate and uncertain tax positions, partially offset by the benefit from tax credits. See the components of our effective tax rate reconciliation in Note 10.
Reworded paragraphs (18)
Previous 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 Consolidated Financial Statements for more information on discontinued operations.
Current wording
In fiscal 2025, the Company completed the Aviara Transaction and 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 Consolidated Financial Statements for more information on discontinued operations.
Previous wording
Operating Expenses. Operating expenses increased 3.4 percent during fiscal 2025 when compared to the same prior year period mainly due to increased variable compensation costs.
Current wording
Operating Expenses. Operating expenses increased 77.3 percent during fiscal 2026 when compared to the same prior year period primarily due to Marine Products Transaction costs, incremental costs incurred in our Recreation and Sport Fishing segment as a result of the transaction, order-backlog and dealer network amortization related to the transaction, non-cash impairment charges related to intangible assets in our Leisure segment as discussed below, ERP implementation costs, and increased variable compensation costs.
Previous wording
Interest Expense. Interest expense decreased $2.1 million primarily due to all outstanding borrowings under the Credit Agreement being repaid during the first six months of fiscal 2025.
Current wording
Interest Expense. Interest expense decreased $1.0 million, primarily reflecting the repayment of all borrowings under the 2021 Credit Agreement during the first six months of fiscal 2025. While the Company borrowed under its Revolving Credit Facility in connection with the Marine Products Transaction during fiscal 2026, those borrowings were subsequently repaid during the year.
Previous wording
Income Tax Expense. Our consolidated effective income tax rate decreased to 20.8 percent for fiscal 2025 from 22.5 percent for fiscal 2024. See Note 10 in Notes to Consolidated Financial Statements for more information.
Current wording
Income Tax Expense. Our consolidated effective income tax rate was 22.6 percent for fiscal 2026, up from 20.8 percent for fiscal 2025. See Note 11 in Notes to Consolidated Financial Statements for more information.
Previous wording
Net sales decreased 27.1 percent during fiscal 2025, when compared to fiscal 2024, as a result of decreased unit volume and increased dealer incentives, partially offset by favorable model mix and favorable option sales.
Current wording
Net sales increased 2.2 percent during fiscal 2026, when compared to fiscal 2025, as a result of favorable option sales, increased prices, and decreased dealer incentives, partially offset by unfavorable model mix and decreased unit sales volume.
Previous wording
We define EBITDA as income from continuing operations, before interest, income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA further adjusted to eliminate certain non-cash charges or other items that we do not consider to be indicative of our core and/or ongoing operations. For the periods presented herein, these adjustments include share-based compensation, senior leadership transition and organizational realignment costs, and business development consulting costs, as described in more detail below. We define EBITDA margin and Adjusted EBITDA margin as EBITDA and Adjusted EBITDA, respectively, expressed as a percentage of Net sales.
Current wording
We define EBITDA as income from continuing operations, before interest, income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA further adjusted to eliminate certain non-cash charges or other items that we do not consider to be indicative of our core and/or ongoing operations. For the periods presented herein, these adjustments include share-based compensation, senior leadership transition and organizational realignment costs, Enterprise resource planning (“ERP”) implementation costs, Marine Products Transaction costs, impairments, and inventory step-up as described in more detail below. We define EBITDA margin and Adjusted EBITDA margin as EBITDA and Adjusted EBITDA, respectively, expressed as a percentage of Net sales.
Previous wording
We define Adjusted Net Income and Adjusted Net Income per share as income from continuing operations adjusted to eliminate certain non-cash charges or other items that we do not consider to be indicative of our core and/or ongoing operations and reflecting income tax expense on adjusted net income before income taxes at our estimated annual effective tax rate. For the periods presented herein, these adjustments include other intangible asset amortization, share-based compensation, senior leadership transition and organizational realignment costs, and business development consulting costs.
Current wording
We define Adjusted Net Income and Adjusted Net Income per share as income from continuing operations adjusted to eliminate certain non-cash charges or other items that we do not consider to be indicative of our core and/or ongoing operations and reflecting income tax expense on adjusted net income before income taxes at our estimated annual effective tax rate. For the periods presented herein, these adjustments include other intangible asset amortization, share-based compensation, senior leadership transition and organizational realignment costs, ERP implementation costs, Marine Products Transaction costs, impairments, and inventory step-up.
Previous wording
Represents amounts paid for legal fees and recruiting costs associated with the CEO and CFO transitions, as well as non-recurring severance costs incurred as part of the Company's strategic organizational realignment undertaken in connection with the transitions.
Current wording
Represents amounts paid for legal fees and recruiting costs associated with the CEO and CFO transitions, as well as one-time severance costs incurred as part of the Company’s strategic organizational realignment undertaken in connection with the transitions.
Previous wording
Reflects income tax expense at a tax rate of 20.0% for 2025 and 2024, and 23.0% for 2023.
Current wording
Reflects income tax expense at a tax rate of 23.0% for 2026, and 20.0% for 2025 and 2024.
Previous wording
Represents the Weighted average shares used for the computation of Basic and Diluted earnings (loss) per share as presented on the Consolidated Statements of Operations to calculate Adjusted Net Income per diluted share for all periods presented herein.
Current wording
Represents the Weighted average shares used for the computation of Basic and Diluted earnings per share as presented on the Consolidated Statements of Operations to calculate Adjusted Net Income per diluted share for all periods presented herein.
Previous wording
Cash and cash equivalents totaled $28.9 million as of June 30, 2025, an increase of $21.5 million from $7.4 million as of June 30, 2024. Short-term investments totaled $50.5 million as of June 30, 2025, a decrease of $28.3 million from $78.8 million as of June 30, 2024. Net changes in Cash and cash equivalents and Short-term investments include proceeds from short-term investments 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 Consolidated Financial Statements for further details. Total debt as of June 30, 2024 was $49.3 million, with no amounts outstanding as of June 30, 2025.
Current wording
Cash and cash equivalents totaled $43.9 million as of June 30, 2026, an increase of $15.0 million from $28.9 million as of June 30, 2025. There were no short-term investments as of June 30, 2026, compared to $50.5 million as of June 30, 2025. Net changes in Cash and cash equivalents and Short-term investments include certain investment securities maturing with proceeds used in connection with funding the Marine Products Transaction. Refer to Note 4 — Business Combinations in the Notes to Consolidated Financial Statements for further details.
Previous wording
On July 24, 2023, the Board authorized a new share repurchase program under which the Company may repurchase up to $50.0 million of its outstanding shares of common stock. The new authorization became effective upon the completion of the Company’s previously existing $50.0 million stock repurchase authorization. As of June 30, 2025, $25.9 million remained available under the new authorization.
Current wording
On July 24, 2023, the Board authorized a new share repurchase program under which the Company may repurchase up to $50.0 million of its outstanding shares of common stock. The new authorization became effective upon the completion of the Company’s previously existing $50.0 million share repurchase authorization. As of June 30, 2026, $23.5 million remained available under the new authorization.
Previous wording
During fiscal 2025 and fiscal 2024, the Company repurchased 531,970 shares and 750,943 shares of common stock for $9.5 million and $16.3 million, respectively, in cash, including related fees and expenses.
Current wording
During fiscal 2026 and fiscal 2025, the Company repurchased 116,370 shares and 531,970 shares of common stock for $2.3 million and $9.5 million, respectively, in cash, including related fees and expenses.
Previous wording
Net cash provided by operating activities was $38.2 million, primarily due to net income and favorable working capital changes. 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 consolidated balance sheets, excluding the impact of acquisitions and non-cash adjustments. Favorable changes in working capital primarily consisted of a decrease in inventories, accounts receivable, other assets, prepaid expenses and other current assets, and an increase in income tax payable, partially offset by a decrease in accounts payable. Inventories decreased due to timing of sales at the end of the period compared to the end of the prior-year and planned raw materials reduction due to lower unit production volume. Accounts receivable decreased due to timing of sales at the end of the period compared to the end of the prior-year period. Income tax payable increased due to timing of estimated payments. Prepaid expenses and other current assets decreased mainly due to lower general insurance premiums. Accounts payable decreased due to a reduction in raw material purchases and timing of purchases at the end of the period compared to the prior-year period.
Current wording
Net cash provided by operating activities was $38.2 million, primarily due to net income and favorable working capital changes. Favorable changes in working capital primarily consisted of a decrease in inventories, accounts receivable, other assets, prepaid expenses and other current assets, and an increase in income tax payable, partially offset by a decrease in accounts payable. Inventories decreased due to timing of sales at the end of the period compared to the end of the prior-year and planned raw materials reduction due to lower unit production volume. Accounts receivable decreased due to timing of sales at the end of the period compared to the end of the prior-year period. Income tax payable increased due to timing of estimated payments. Prepaid expenses and other current assets decreased mainly due to lower general insurance premiums. Accounts payable decreased due to a reduction in raw material purchases and timing of purchases at the end of the period compared to the prior-year period.
Previous wording
Purchase Commitments — As of June 30, 2025, the Company is committed to purchasing $2.8 million of engines. See Note 12 in the accompanying Notes to Consolidated Financial Statements for more information.
Current wording
Purchase Commitments — As of June 30, 2026, the Company is committed to purchasing $1.3 million of engines. See Note 13 in the accompanying Notes to Consolidated Financial Statements for more information.
Previous wording
The costs of amortizable intangible assets, including dealer networks, are recognized over their expected useful lives, approximately ten years for the dealer networks, using the straight-line method. The dealer network intangible asset within our MasterCraft reporting unit is fully amortized. The dealer network intangible asset within our Pontoon reporting unit that is subject to amortization is evaluated for impairment using a process similar to that used to evaluate long-lived assets as described below.
Current wording
The costs of amortizable intangible assets, including dealer networks, are recognized over their expected useful lives using the straight-line method. The dealer network intangible asset within our Performance and Wake segment is fully amortized. The dealer network intangible assets within our Leisure and Recreation and Sport Fishing that are subject to amortization are evaluated for impairment using a process similar to that used to evaluate long-lived assets as described below. As discussed below, the Company recorded an impairment charge related to the Crest dealer network intangible asset within the Leisure segment during fiscal 2026.
Previous wording
In conjunction with the impairment assessment as discussed above, the Company determined certain indicators of potential impairment existed for the Crest brand asset group, resulting in an undiscounted cash flow analysis. The analysis concluded the undiscounted cash flows exceeded the carrying value of the asset group, resulting in no impairment.
Current wording
In conjunction with the impairment assessment as discussed above, the Company determined certain indicators of potential impairment existed for the asset group within the Leisure segment, resulting in an undiscounted cash flow analysis. The analysis concluded the undiscounted cash flows exceeded the carrying value of the asset group, resulting in no impairment.
Previous wording
Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. Although we believe our reserves are reasonable, we cannot provide assurance that the final tax outcome of these matters will not be different from that which is reflected in our historical income tax provisions and accruals. We adjust these reserves in light of changing facts and circumstances, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will impact the provision for income taxes in the period in which such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to reserves that are considered appropriate, as well as the related net interest.
Current wording
Income Taxes—Significant judgment is required in evaluating our uncertain tax positions and determining our provision for income taxes. Although we believe our reserves are reasonable, we cannot provide assurance that the final tax outcome of these matters will not be different from that which is reflected in our historical income tax provisions and accruals. We adjust these reserves in light of changing facts and circumstances, such as the closing of a tax audit or the refinement of an estimate. To the extent that the final tax outcome of these matters is different than the amounts recorded, such differences will impact the provision for income taxes in the period in which such determination is made. The provision for income taxes includes the impact of reserve provisions and changes to reserves that are considered appropriate, as well as the related net interest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Net cash provided by operating activities was $30.4 million, primarily due to net loss adjusted for non-cash items and favorable changes in 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 consolidated balance sheets, excluding the impact of acquisitions and non-cash adjustments. Favorable changes in working capital primarily consisted of an increase in accounts payable and decrease in inventories, partially offset by a decrease in income tax payable and an increase in accounts receivable and prepaid expenses and other current assets. Accounts payable increased due to timing of professional fee payments related to the Marine Products Transaction and timing of purchases at the end of the period compared to the prior-year period. Inventories decreased primarily due to the inventory step-up charge related to the Marine Products Transaction. Income tax payable decreased during the period; refer to Note 11 – Income Taxes in the Notes to Consolidated Financial Statements for further details. Accounts receivable increased due to timing of sales at the end of the period compared to the end of the prior-year period. Prepaid expenses and other current assets increased due to additional prepaid insurance related to the Marine Products Transaction and increased prepaid IT and sales-related expenditures.