MasterCraft Boat Holdings, Inc.

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

BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation — Through fiscal 2026, the Company’s fiscal year began on July 1 and ended on June 30, with the interim quarterly reporting periods consisting of 13 weeks. In fiscal 2026, the Company announced that its Board of Directors (the “Board”) approved a change in the Company’s fiscal year-end from June 30 to December 31, effective July 1, 2026. Accordingly, the Company will file a Transition Report on Form 10-KT covering the period from July 1, 2026, through December 31, 2026 (the “Transition Period”), after which reporting periods will be based on the new fiscal year.

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, 2026, and, in the opinion of management, reflect all adjustments considered necessary to present fairly the Company’s financial position as of October 4, 2026, its results of operations for the three months ended October 4, 2026 and September 28, 2025, its cash flows for the three months ended October 4, 2026 and September 28, 2025, and its statements of equity for the three months ended October 4, 2026 and September 28, 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, 2026 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 2026 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 months ended October 4, 2026, as compared with those described in the Company’s audited consolidated financial statements for the fiscal year ended June 30, 2026.

Reclassifications — Certain historical amounts have been reclassified in these condensed consolidated financial statements and the accompanying notes herewith to conform to the current presentation. These reclassifications include certain corporate expenses previously included in segment Operating expenses that have been reclassified to Corporate expenses and other in the reconciliation of Segment Adjusted EBITDA to consolidated Income before taxes. (see Note 14 — Segment Information).

New Accounting Pronouncements Issued But Not Yet Adopted

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 2027 for the Company, and is effective for interim periods within fiscal years beginning after December 15, 2027, or fiscal 2028 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, 2026, the Company had $6.5 million of contract liabilities associated with customer deposits and telematic services. During thethree months ended October 4, 2026, $2.3 million was recognized as revenue. As of October 4, 2026, total contract liabilities associated with customer deposits, telematic services, and other of $8.1 million were reported in Accrued expenses and other current liabilities and Other long-term liabilities on the condensed consolidated balance sheet, and $1.6 million is expected to be recognized as revenue during the remainder of the Transition Period.

BUSINESS COMBINATIONS

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 $284.2 million (the “Marine Products Transaction”).

During the first three months of the Transition Period, the Company recorded measurement period adjustments to certain assets acquired and liabilities assumed. The following table presents the Company’s updated preliminary allocation of the purchase price:

The purchase price allocation is preliminary and subject to change as the Company finalizes valuations of certain acquired assets and assumed liabilities, including inventory, property and equipment, identifiable intangible assets, warranty liabilities, income taxes, and other working capital balances. The Company expects to finalize the purchase accounting during the measurement period, which will not exceed one year from the acquisition date.

The Company incurred acquisition and integration related costs of $1.9 million and $0.3 million for the three months ended October 4, 2026, and September 28, 2025, respectively, related to the Marine Products Transaction. These costs are included within General and administrative expenses in the accompanying condensed consolidated statement of operations.

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 October 4, 2026 and June 30, 2026 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 months ended October 4, 2026 and September 28, 2025, was $0.6 million and $0.5 million, respectively. Estimated amortization expense for the Transition Period ending December 31, 2026 is $1.1 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 thethree months ended:

8. COMMITMENTS AND CONTINGENCIES

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

In fiscal 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, 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 months ended October 4, 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 October 4, 2026 and June 30, 2026, there were no amounts outstanding, and the Company had remaining availability of $75.0 million 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 October 4, 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 three months of the Transition Period primarily relate to changes in uncertain tax positions, federal and state tax credits, and rate changes, partially offset by the state income taxes. During the three months ended October 4, 2026 and September 28, 2025, the Company’s effective tax rate was 1.7% and 19.60%, respectively. Changes to the Company’s effective tax rate for the three months ended October 4, 2026 compared to the effective tax rate for the same prior year period primarily relate to changes in uncertain tax positions and rate changes.

SHARE-BASED COMPENSATION

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

Restricted Stock

During the three months ended October 4, 2026, the Company granted 107,074 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 thethree months ended October 4, 2026, was $21.10 per share.

The following table summarizes the status of nonvested Restricted Stock Awards and RSUs as of October 4, 2026, and changes during the three months then ended.

As of October 4, 2026, there was $4.9 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 1.9 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 performance period for the awards commences on July 1 and continues for a three-year period, ending on June 30 of the applicable year. The probability of achieving the performance criteria is assessed quarterly.

PSUs of 72,303 and 96,751 awarded in fiscal 2026 and fiscal 2025, 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 certain 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 in year three of the performance period. For PSUs awarded in fiscal 2026 and fiscal 2025, 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.

PSUs of 55,870 awarded during the Transition Period, have a performance criteria over athree-year performance period. The performance period for the awards commenced on July 1, 2026 and continues for a three-year period, ending on June 30, 2029. Fifty percentof the awards are based on cumulative diluted adjusted earnings per share performance over the three-year performance period, while the remaining fifty percent are based solely on the Company's relative total shareholder return performance over the same period. Compensation expense related to nonvested PSUs awarded in the Transition Period is recognized ratably over the performance period.

The following table summarizes the status of nonvested PSUs as of October 4, 2026, and changes during the three months then ended.

As of October 4, 2026, there was $1.1 million of total unrecognized compensation expense related to related to nonvested PSUs. The Company expects this expense to be recognized over a weighted average period of 2.7 years.

RELATED PARTY TRANSACTIONS

255 RC, LLC

The Company owns a 50% interest in 255 RC, LLC (“255 RC”), a limited liability company formed for the joint ownership of a corporate aircraft. The Company accounts for its investment in 255 RC under the equity method of accounting.

The Company is party to an operating lease and management arrangement with 255 RC for use of the aircraft. Pursuant to the arrangement, we share fixed lease expenses with 255 RC on an equal basis and are solely responsible for lease costs directly attributable to our business flights actually taken during an applicable billing period. During the first three months of the Transition Period, the Company recorded aircraft-related operating costs, including rent and its allocable share of certain fixed operating costs, of $0.3 million.

As of October 4, 2026, and June 30, 2026, the Company had a payable of $2.3 million due to 255 RC. The carrying value of the Company's investment in 255 RC was $4.4 million and $4.3 million as of October 4, 2026 and June 30, 2026, respectively.

Transition Services Agreement

In connection with the Marine Products Transaction, we entered into a Transition Services Agreement with RPC, Inc (“RPC”). LOR, Inc. is a holder of greater than 10% of our common stock and the largest shareholder of RPC.

Pursuant to the Transition Services Agreement, RPC (i) provides certain administrative services to us on a cost reimbursement basis that were previously provided to Marine Products prior to the Marine Products Transaction and (ii) will continue to administer the RPC 401(k) Plan to certain of our employees that previously were employed by Marine Products prior to the Marine Products Transaction. The Transition Services Agreement may be terminated upon six months’ notice. The Company reimbursed RPC $0.1 million for its estimated allocable share of administrative costs incurred for services rendered on behalf of the Company during thethree months ended October 4, 2026.

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 months ended October 4, 2026, and September 28, 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 October 4, 2026, and September 28, 2025, the Company repurchased 217,616 shares and 116,370 shares of common stock for $4.8 million and $2.3 million, respectively, in cash, excluding related fees and expenses. As of October 4, 2026, $18.7 million remained available under the program.

14. SEGMENT INFORMATION

Reportable Segments

Beginning in the Transition Period, the Company changed the manner in which certain corporate expenses are allocated to its reportable segments. Prior-period segment information has been recast to conform to the current-period presentation. Certain corporate expenses previously included within segment operating expenses are now presented within Corporate expenses and other in the reconciliation of Segment Adjusted EBITDA to Income before taxes.

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 months ended October 4, 2026, the Company’s CODM regularly assessed the operating performance of the Company’s boat brands under three operating and reportable segments:

•

The Performance and Wake 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.

•

The Leisure 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.

•

The Recreation and Sport Fishing segment, consisting of our Chaparral and Robalo brands, produces recreational and sport fishing boats at its Nashville, Georgia facility.

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 CODM evaluates segment performance and allocates resources based on Segment Adjusted EBITDA, which represents segment profit or loss before interest, taxes, depreciation, and amortization and certain adjustment items attributable to each reportable segment. Accordingly, the aggregate of Segment Adjusted EBITDA is not intended to represent, and is not directly comparable to, the Company's consolidated Adjusted EBITDA measure presented elsewhere in this Quarterly Report.

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

(1)

Segment 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 costs, acquisition and integration costs, including the change in fiscal year-end, related to the Marine Products Transaction, and inventory step-up.

(3)

Corporate expenses and other includes costs incurred at the corporate level that are not allocated to the segments, including executive compensation, certain other corporate salaries, compensation and benefits, corporate professional fees, and other corporate costs.

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