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The closure of the MarineMax store in Tampa is a sign of the times.
But the property isn't for sale because of a decline in business. Annual revenue at Clearwater-based MarineMax was $584.5 million in 2013, up 11% from a year earlier.
The store, near Interstate 4, sold repossessed boats during the downturn. With the improving economy, there are now fewer repossessed vessels to resell, says Kyle Langbehn, a MarineMax regional vice president.
“There was a time when there was a glut of repossessed boats,” Langbehn says. “That time has passed. There was no need to keep that location open.”
MarineMax, the nation's largest recreational boating retailer, reported eight consecutive quarters of growth in same-store sales. It now has 54 locations.
“We believe the combination of our strong team, leading brands, and our formidable balance sheet provide a strong foundation and competitive advantage as the market recovers,” says MarineMax Chairman and CEO Bill McGill in a written statement.
The public company (symbol: HZO; recent price: $15.45) reported net income of $15 million for the year ended Sept. 30, compared with $1.1 million a year earlier. But net income included $11.7 million in damages from BP for the 2010 Deepwater Horizon oil spill.
MarineMax received $7 million in the third quarter and another $4.7 million in the fourth quarter, boosting the company's balance sheet, CFO Mike McLamb told analysts in a fourth-quarter call.
In addition, sales picked up in the last half of the year, boosting confidence the boating industry is recovering.
“We are feeling very positive,” Langbehn says. “The outboard (motor) segment seems to be leading the recovery for us.”
Larger boats, between 40 and 60 feet, with inboard motors are also selling well, he says.
MarineMax reported a 9% rise in revenue to $149.7 million in the fourth quarter. Net income was $490,000, up from a net loss of $1.6 million in the same quarter a year earlier. The figures exclude the BP settlement.
The retailer, which sells Sea Ray, Scarab jet boats, Azimut Yachts, and Boston Whaler, among other brands, doesn't expect to reach its pre-recession high of $1.3 billion in 2014.
“But we're certainly headed in the right direction,” Langbehn adds.
McLamb is also confident the company will keep up its momentum in the new year, while McGill says MarineMax holds the “lion's share” of the market. “We have been growing substantially better than the rest of the industry,” McGill told analysts.
B. Riley & Co. analyst Jimmy Baker selected MarineMax as his top pick for the fourth-quarter earnings season after noting it's the first time the retailer has been profitable in its typically slow quarter since 2007.
As MarineMax started its 2014 fiscal year, management had been digging deeper into its cost of operations and renegotiating any costs possible, McLamb says.
Like other companies, MarineMax faces rising insurance costs — from health care to property and casualty.
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