Marine Products deal costs hit MasterCraft (NASDAQ: MCFT) Q3 profit
Rhea-AI Filing Summary
MasterCraft Boat Holdings posted third-quarter fiscal 2026 net sales of $78.2 million, up 3% year over year, with gross margin improving to 25.0% from 20.8% on richer model mix, higher option content, pricing, and lower dealer incentives.
After $8.4 million of business development and consulting costs tied to its pending Marine Products combination and other adjustments, the company reported a GAAP net loss of $0.7 million, or $(0.05) per share, but generated Adjusted Net Income of $7.2 million, or $0.45 per diluted share.
Cash and cash equivalents rose to $75.4 million, plus $9.2 million of short-term investments, with no debt and $75.0 million of unused revolver capacity, supporting the stock-and-cash Marine Products deal that will deliver 0.232 MasterCraft shares and $2.43 in cash per Marine Products share if approved.
Positive
- None.
Negative
- None.
Insights
Solid operations and balance sheet, but merger-related costs mask underlying earnings.
MasterCraft grew Q3 fiscal 2026 net sales 3% to $78.2M, while expanding gross margin 420 basis points to 25.0%. That margin gain reflects better mix, higher pricing and options, and lower dealer incentives despite slightly lower consolidated unit volume.
GAAP results swung to a small loss, with net income from continuing operations at $(0.7)M, mainly because of $8.4M in business development and consulting costs and other adjustments tied to the pending Marine Products transaction and ERP work. On a normalized basis, Adjusted EBITDA rose to $10.7M and Adjusted Net Income to $7.2M.
The company’s financial position is strong: cash of $75.4M, short-term investments of $9.2M, no debt, and a $75.0M undrawn Revolving Credit Facility maturing in 2031. The Marine Products combination, offering 0.232 shares plus $2.43 cash per Marine Products share, remains subject to shareholder approvals at the May 12, 2026 special meeting and customary closing conditions.
Key Figures
Key Terms
Adjusted EBITDA financial
Free Cash Flow financial
Revolving Credit Facility financial
enterprise resource planning system technical
performance stock units financial
Earnings Snapshot
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended:
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☑
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☑
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes
As of May 1, 2026, there were
TABLE OF CONTENTS
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PART I |
FINANCIAL INFORMATION |
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Item 1. |
Financial Statements |
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Unaudited Condensed Consolidated Statements of Operations |
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Unaudited Condensed Consolidated Balance Sheets |
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Unaudited Condensed Consolidated Statements of Equity |
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Unaudited Condensed Consolidated Statements of Cash Flows |
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Notes to Unaudited Condensed Consolidated Financial Statements |
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Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. |
Quantitative and Qualitative Disclosures About Market Risk |
25 |
Item 4. |
Controls and Procedures |
25 |
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PART II |
OTHER INFORMATION |
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Item 1. |
Legal Proceedings |
27 |
Item 1A. |
Risk Factors |
27 |
Item 2. |
Unregistered Sales of Securities and Use of Proceeds |
27 |
Item 3. |
Defaults Upon Senior Securities |
27 |
Item 4. |
Mine Safety Disclosures |
27 |
Item 5. |
Other Information |
27 |
Item 6. |
Exhibits, Financial Statement Schedules |
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SIGNATURES |
29 |
2
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains certain “forward-looking statements” within the meaning of the federal securities laws. These forward-looking statements can generally be identified by the use of statements that include words such as “could,” “may,” “might,” “will,” “expect,” “likely,” “believe,” “continue,” “anticipate,” “estimate,” “intend,” “plan,” “project” and other similar words or phrases. Forward-looking statements involve estimates and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements.
The forward-looking statements contained in this Quarterly Report on Form 10-Q are based on assumptions that we have made considering our industry experience and our perceptions of historical trends, current conditions, expected future developments and other important factors we believe are appropriate under the circumstances. As you read and consider this Quarterly Report on Form 10-Q, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (many of which are beyond our control) and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many important factors could affect our actual operating and financial performance and cause our performance to differ materially from the performance anticipated in the forward-looking statements, including but not limited to the following: changes in interest rates, general economic conditions, changes in trade priorities, policies and regulations, including increases or changes in duties, current and potentially new tariffs or quotas and other similar measures, as well as the potential direct and indirect impact of reciprocal tariffs and other actions and uncertainty with respect to potential recovery of tariffs paid that have been determined to be unlawful, demand for our products, persistent inflationary pressures, changes in consumer preferences, competition within our industry, our ability to maintain a reliable network of dealers, including new dealers in international locations, our ability to cooperate with our strategic partners, elevated inventories resulting in increased costs for dealers, our ability to manage our manufacturing levels and our fixed cost base, the successful introduction of our new products, geopolitical conflicts and other political developments, financial institution disruptions, our ability to consummate the pending combination with Marine Products Corporation (“Marine Products”) on the proposed terms or on the proposed timeline, or at all, including risks and uncertainties related to securing the necessary regulatory and stockholder approvals and the satisfaction of other closing conditions, the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive agreement relating to the transaction with Marine Products, effects relating to the pending combination with Marine Products, including on the market price of our common stock and our relationships with customers, employees, dealers and suppliers, and the risk of potential stockholder litigation associated with the pending combination with Marine Products, and the other important factors described under the caption “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025, filed with the Securities and Exchange Commission (“SEC”) on August 27, 2025 (our “2025 Annual Report”). Should one or more of these risks or uncertainties materialize, or should any of these assumptions prove incorrect, our actual operating and financial performance may vary in material respects from the performance projected in these forward-looking statements.
Further, any forward-looking statement speaks only as of the date on which it is made, and except as required by law, we undertake no obligation to update any forward-looking statement contained in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date on which it is made or to reflect the occurrence of anticipated or unanticipated events or circumstances. New important factors that could cause our business not to develop as we expect may emerge from time to time, and it is not possible for us to predict all of them.
3
MASTERCRAFT BOAT HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
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Nine Months Ended |
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March 30, |
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(Dollar amounts in thousands, except per share data) |
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2026 |
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NET SALES |
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COST OF SALES |
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GROSS PROFIT |
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OPERATING EXPENSES: |
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Selling and marketing |
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General and administrative |
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Amortization of other intangible assets |
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Total operating expenses |
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OPERATING INCOME (LOSS) |
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OTHER INCOME (EXPENSE): |
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Interest expense |
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Loss on extinguishment of debt |
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INCOME (LOSS) BEFORE INCOME TAX EXPENSE |
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INCOME TAX EXPENSE |
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INCOME (LOSS) FROM CONTINUING OPERATIONS |
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LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX (Note 3) |
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NET INCOME (LOSS) |
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INCOME (LOSS) PER SHARE: |
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Basic |
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Continuing operations |
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Discontinued operations |
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Net income (loss) |
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Diluted |
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Continuing operations |
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Discontinued operations |
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Net income (loss) |
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WEIGHTED AVERAGE SHARES USED FOR COMPUTATION OF: |
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Basic earnings per share |
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Diluted earnings per share |
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Notes to Unaudited Condensed Consolidated Financial Statements form an integral part of the condensed consolidated financial statements.
4
MASTERCRAFT BOAT HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
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March 29, |
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June 30, |
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(Dollar amounts in thousands, except per share data) |
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2026 |
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2025 |
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ASSETS |
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CURRENT ASSETS: |
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Cash and cash equivalents |
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$ |
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$ |
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Short-term investments (Note 4) |
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Accounts receivable, net of allowance of $ |
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Income tax receivable |
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Inventories, net (Note 5) |
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Prepaid expenses and other current assets |
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Total current assets |
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Property, plant and equipment, net (Note 6) |
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Goodwill (Note 7) |
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Other intangible assets, net (Note 7) |
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Deferred income taxes |
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Other long-term assets |
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Total assets |
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$ |
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LIABILITIES AND EQUITY |
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CURRENT LIABILITIES: |
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Accounts payable |
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$ |
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Income tax payable |
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Accrued expenses and other current liabilities (Note 8) |
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Total current liabilities |
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Unrecognized tax positions |
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Other long-term liabilities |
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Total liabilities |
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EQUITY: |
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Common stock, $ |
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Additional paid-in capital |
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Retained earnings |
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MasterCraft Boat Holdings, Inc. equity |
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Noncontrolling interest |
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Total equity |
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Total liabilities and equity |
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$ |
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Notes to Unaudited Condensed Consolidated Financial Statements form an integral part of the condensed consolidated financial statements.
5
MASTERCRAFT BOAT HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
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Additional |
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MasterCraft Boat |
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Common Stock |
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Paid-in |
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Retained |
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Holdings, |
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Noncontrolling |
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(Dollar amounts in thousands) |
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Shares |
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Amount |
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Capital |
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Earnings |
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Inc. Equity |
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Interest |
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Total |
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Balance at June 30, 2025 |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Share-based compensation activity |
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— |
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— |
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Repurchase and retirement of common stock |
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— |
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— |
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( |
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Net income |
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— |
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— |
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— |
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— |
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Balance at September 28, 2025 |
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Share-based compensation activity |
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— |
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— |
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— |
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Net income |
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— |
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— |
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Balance at December 28, 2025 |
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Share-based compensation activity |
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— |
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Net loss |
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— |
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Balance at March 29, 2026 |
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$ |
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$ |
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$ |
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$ |
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$ |
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$ |
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Additional |
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MasterCraft Boat |
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Common Stock |
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Paid-in |
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Retained |
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Holdings, |
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Noncontrolling |
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Shares |
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Amount |
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Capital |
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Earnings |
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Inc. Equity |
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Interest |
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Total |
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Balance at June 30, 2024 |
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$ |
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$ |
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$ |
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$ |
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$ |
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Share-based compensation activity |
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— |
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— |
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Repurchase and retirement of common stock |
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— |
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( |
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— |
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Net loss |
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— |
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— |
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— |
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Balance at September 29, 2024 |
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Share-based compensation activity |
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— |
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— |
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Repurchase and retirement of common stock |
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( |
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— |
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( |
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— |
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( |
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— |
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( |
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Net income |
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— |
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— |
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— |
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— |
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Balance at December 29, 2024 |
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Share-based compensation activity |
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— |
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— |
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— |
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Repurchase and retirement of common stock |
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— |
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( |
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— |
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( |
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— |
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( |
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Net income |
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— |
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— |
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— |
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— |
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Balance at March 30, 2025 |
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$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
|
|
|
$ |
|
|||||||
Notes to Unaudited Condensed Consolidated Financial Statements form an integral part of the condensed consolidated financial statements.
6
MASTERCRAFT BOAT HOLDINGS, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
Nine Months Ended |
|
|||||
|
|
March 29, |
|
|
March 30, |
|
||
(Dollar amounts in thousands) |
|
2026 |
|
|
2025 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Loss from discontinued operations, net of tax |
|
|
|
|
|
|
||
Income from continuing operations |
|
|
|
|
|
|
||
Adjustments to reconcile income from continuing operations to net cash used in operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Share-based compensation |
|
|
|
|
|
|
||
Unrecognized tax benefits |
|
|
|
|
|
|
||
Deferred income taxes |
|
|
|
|
|
|
||
Changes in certain operating assets and liabilities |
|
|
( |
) |
|
|
|
|
Other, net |
|
|
|
|
|
|
||
Net cash provided by operating activities of continuing operations |
|
|
|
|
|
|
||
Net cash provided by (used in) operating activities of discontinued operations |
|
|
|
|
|
( |
) |
|
Net cash provided by operating activities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
||
Purchases of property, plant and equipment |
|
|
( |
) |
|
|
( |
) |
Purchases of investments |
|
|
( |
) |
|
|
( |
) |
Proceeds from investments |
|
|
|
|
|
|
||
Other, net |
|
|
|
|
|
|
||
Net cash provided by investing activities of continuing operations |
|
|
|
|
|
|
||
Net cash provided by investing activities of discontinued operations |
|
|
|
|
|
|
||
Net cash provided by investing activities |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Principal payments on long-term debt |
|
|
|
|
|
( |
) |
|
Borrowings on revolving credit facility |
|
|
|
|
|
|
||
Principal payments on revolving credit facility |
|
|
|
|
|
( |
) |
|
Repurchase and retirement of common stock |
|
|
( |
) |
|
|
( |
) |
Other, net |
|
|
( |
) |
|
|
( |
) |
Net cash used in financing activities of continuing operations |
|
|
( |
) |
|
|
( |
) |
Net cash provided by (used in) financing activities of discontinued operations |
|
|
|
|
|
|
||
Net cash used in financing activities |
|
|
( |
) |
|
|
( |
) |
NET CHANGE IN CASH AND CASH EQUIVALENTS |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS — BEGINNING OF PERIOD |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS — END OF PERIOD |
|
$ |
|
|
$ |
|
||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: |
|
|
|
|
|
|
||
Cash payments for interest, net of amounts capitalized |
|
$ |
|
|
$ |
|
||
Cash payments for income taxes |
|
|
|
|
|
|
||
NON-CASH INVESTING AND FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Capital expenditures in accounts payable and accrued expenses |
|
|
|
|
|
|
||
Notes to Unaudited Condensed Consolidated Financial Statements form an integral part of the condensed consolidated financial statements.
7
MASTERCRAFT BOAT HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unless otherwise noted, dollars in thousands, except per share data)
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.
8
The following tables present the Company's revenue by major product category for each reportable segment:
|
|
Three Months Ended March 29, 2026 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Total |
|
|||
Major Product Categories: |
|
|
|
|
|
|
|
|
|
|||
Boats and trailers |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Parts |
|
|
|
|
|
|
|
|
|
|||
Other revenue |
|
|
|
|
|
|
|
|
|
|||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|||
|
|
Nine Months Ended March 29, 2026 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Total |
|
|||
Major Product Categories: |
|
|
|
|
|
|
|
|
|
|||
Boats and trailers |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Parts |
|
|
|
|
|
|
|
|
|
|||
Other revenue |
|
|
|
|
|
|
|
|
|
|||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|||
|
|
Three Months Ended March 30, 2025 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Total |
|
|||
Major Product Categories: |
|
|
|
|
|
|
|
|
|
|||
Boats and trailers |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Parts |
|
|
|
|
|
|
|
|
|
|||
Other revenue |
|
|
|
|
|
|
|
|
|
|||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|||
|
|
Nine Months Ended March 30, 2025 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Total |
|
|||
Major Product Categories: |
|
|
|
|
|
|
|
|
|
|||
Boats and trailers |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Parts |
|
|
|
|
|
|
|
|
|
|||
Other revenue |
|
|
|
|
|
|
|
|
|
|||
Total |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Contract Liabilities
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”).
9
The following table summarizes the operating results of discontinued operations for the following periods:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
March 29, |
|
|
March 30, |
|
||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
NET SALES |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
COST OF SALES |
|
|
|
|
|
|
|
|
|
|
|
|
||||
GROSS PROFIT (LOSS) |
|
|
|
|
|
|
|
|
|
|
|
( |
) |
|||
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling, general and administrative |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total operating expenses |
|
|
|
|
|
|
|
|
|
|
|
|
||||
OPERATING LOSS |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Gain on sale of discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
|
||||
LOSS BEFORE INCOME TAX BENEFIT |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
INCOME TAX BENEFIT |
|
|
|
|
|
|
|
|
|
|
|
|
||||
LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
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.
|
|
March 29, 2026 |
|
|||||||||||||
|
|
|
|
|
Gross |
|
|
Gross |
|
|
|
|
||||
|
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
Fair |
|
||||
|
|
Cost |
|
|
Gains |
|
|
Losses |
|
|
Value |
|
||||
Available-for-sale securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed income securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate bonds |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Total available-for-sale securities |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
June 30, 2025 |
|
|||||||||||||
|
|
|
|
|
Gross |
|
|
Gross |
|
|
|
|
||||
|
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
Fair |
|
||||
|
|
Cost |
|
|
Gains |
|
|
Losses |
|
|
Value |
|
||||
Available-for-sale securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Fixed income securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate bonds |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
U.S. treasury bills |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|||
Total available-for-sale securities |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|||
Inventories consisted of the following:
|
|
March 29, |
|
|
June 30, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Raw materials and supplies |
|
$ |
|
|
$ |
|
||
Work in process |
|
|
|
|
|
|
||
Finished goods |
|
|
|
|
|
|
||
Obsolescence reserve |
|
|
( |
) |
|
|
( |
) |
Total inventories |
|
$ |
|
|
$ |
|
||
10
Property, plant, and equipment, net consisted of the following:
|
|
March 29, |
|
|
June 30, |
|
|
||
|
|
2026 |
|
|
2025 |
|
|
||
Land and improvements |
|
$ |
|
|
$ |
|
|
||
Buildings and improvements |
|
|
|
|
|
|
|
||
Machinery and equipment |
|
|
|
|
|
|
|
||
Furniture and fixtures |
|
|
|
|
|
|
|
||
Construction in progress |
|
|
|
|
|
|
|
||
Total property, plant, and equipment |
|
|
|
|
|
|
|
||
Less accumulated depreciation |
|
|
( |
) |
|
|
( |
) |
|
Property, plant, and equipment — net |
|
|
|
|
$ |
|
|
||
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.
|
|
Gross Amount |
|
|
Accumulated Impairment Losses |
|
|
Total |
|
|||
MasterCraft |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Pontoon |
|
|
|
|
|
( |
) |
|
|
|
||
Total |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||
The following table presents the carrying amounts of Other intangible assets, net:
|
|
March 29, |
|
|
June 30, |
|
||||||||||||||||||
|
|
2026 |
|
|
2025 |
|
||||||||||||||||||
|
|
Gross Amount |
|
|
Accumulated Amortization / Impairment |
|
|
Other intangible assets, net |
|
|
Gross Amount |
|
|
Accumulated Amortization / Impairment |
|
|
Other intangible assets, net |
|
||||||
Amortized intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Dealer networks |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
Software |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Unamortized intangible assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Trade names |
|
|
|
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
|
|
|
||||
Total other intangible assets |
|
$ |
|
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
|
||||
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 $
11
Accrued expenses and other current liabilities consisted of the following:
|
|
March 29, |
|
|
June 30, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Warranty |
|
$ |
|
|
$ |
|
||
Dealer incentives |
|
|
|
|
|
|
||
Compensation and related accruals |
|
|
|
|
|
|
||
Contract liabilities |
|
|
|
|
|
|
||
Inventory repurchase contingent obligation |
|
|
|
|
|
|
||
Self-insurance |
|
|
|
|
|
|
||
Liabilities retained associated with discontinued operations |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total accrued expenses and other current liabilities |
|
$ |
|
|
$ |
|
||
Accrued warranty liability activity was as follows for the nine months ended:
|
|
March 29, |
|
|
March 30, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Balance at the beginning of the period |
|
$ |
|
|
$ |
|
||
Provisions |
|
|
|
|
|
|
||
Payments made |
|
|
( |
) |
|
|
( |
) |
Changes for pre-existing warranties |
|
|
( |
) |
|
|
|
|
Balance at the end of the period |
|
$ |
|
|
$ |
|
||
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 $
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.
12
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 $
The Credit Agreement bears interest, at the Company’s option, at either the prime rate plus an applicable margin ranging from
As of March 29, 2026 and June 30, 2025, there were no amounts outstanding, and the Company had remaining availability of $
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
The following table presents the components of share-based compensation expense by award type.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
March 29, |
|
|
March 30, |
|
||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Restricted stock |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Share-based compensation expense |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Restricted Stock
During the nine months ended March 29, 2026, the Company granted
13
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.
|
|
|
|
|
Average |
|
||
|
|
Nonvested |
|
|
Grant-Date |
|
||
|
|
Restricted |
|
|
Fair Value |
|
||
|
|
Stock |
|
|
(per share) |
|
||
Nonvested at June 30, 2025 |
|
|
|
|
$ |
|
||
Granted |
|
|
|
|
|
|
||
Vested |
|
|
( |
) |
|
|
|
|
Forfeited |
|
|
( |
) |
|
|
|
|
Nonvested at March 29, 2026 |
|
|
|
|
|
|
||
As of March 29, 2026, there was $
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 a
PSUs of
The following table summarizes the status of nonvested PSUs as of March 29, 2026, and changes during the nine months then ended.
|
|
|
|
|
Average |
|
||
|
|
Nonvested |
|
|
Grant-Date |
|
||
|
|
Performance |
|
|
Fair Value |
|
||
|
|
Stock Units |
|
|
(per share) |
|
||
Nonvested at June 30, 2025 |
|
|
|
|
$ |
|
||
Forfeited |
|
|
( |
) |
|
|
|
|
Nonvested at March 29, 2026 |
|
|
|
|
|
|
||
As of March 29, 2026, there was
14
The following table sets forth the computation of the Company’s net income (loss) per share:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
March 29, |
|
|
March 30, |
|
||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Income (loss) from continuing operations |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Loss from discontinued operations, net of tax |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Net income (loss) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average shares — basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Dilutive effect of assumed restricted share awards/units |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average outstanding shares — diluted |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic income (loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Continuing operations |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Net income (loss) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Diluted income (loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Continuing operations |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Discontinued operations |
|
|
( |
) |
|
|
|
|
|
|
|
|
( |
) |
||
Net income (loss) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
|||
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 $
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 under
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.
15
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:
|
|
For the Three Months Ended |
|
|||||||||
|
|
March 29, 2026 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Consolidated |
|
|||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of sales |
|
|
|
|
|
|
|
|
|
|||
Operating expenses(1) |
|
|
|
|
|
|
|
|
|
|||
Adjustments: |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Adjustment items(2) |
|
|
|
|
|
|
|
|
|
|||
Adjusted EBITDA |
|
|
|
|
|
( |
) |
|
|
|
||
Less: Interest Expense |
|
|
|
|
|
|
|
|
( |
) |
||
Add: Interest Income |
|
|
|
|
|
|
|
|
|
|||
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Share-based compensation |
|
|
|
|
|
|
|
|
( |
) |
||
Less: ERP implementation costs |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Business development and consulting costs |
|
|
|
|
|
|
|
|
( |
) |
||
Loss before taxes |
|
|
|
|
|
|
|
|
( |
) |
||
|
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment |
|
|
|
|
|
|
|
|
|
|||
|
|
For the Nine Months Ended |
|
|||||||||
|
|
March 29, 2026 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Consolidated |
|
|||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of sales |
|
|
|
|
|
|
|
|
|
|||
Operating expenses(1) |
|
|
|
|
|
|
|
|
|
|||
Adjustments: |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Adjustment items(2) |
|
|
|
|
|
|
|
|
|
|||
Adjusted EBITDA |
|
|
|
|
|
( |
) |
|
|
|
||
Less: Interest Expense |
|
|
|
|
|
|
|
|
( |
) |
||
Add: Interest Income |
|
|
|
|
|
|
|
|
|
|||
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Share-based compensation |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Senior leadership transition and organizational realignment costs |
|
|
|
|
|
|
|
|
( |
) |
||
Less: ERP implementation costs |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Business development and consulting costs |
|
|
|
|
|
|
|
|
( |
) |
||
Income before taxes |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment |
|
|
|
|
|
|
|
|
|
|||
16
|
|
For the Three Months Ended |
|
|||||||||
|
|
March 30, 2025 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Consolidated |
|
|||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of sales |
|
|
|
|
|
|
|
|
|
|||
Operating expenses(1) |
|
|
|
|
|
|
|
|
|
|||
Adjustments: |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Adjustment items(2) |
|
|
|
|
|
|
|
|
|
|||
Adjusted EBITDA |
|
|
|
|
|
( |
) |
|
|
|
||
Add: Interest Income |
|
|
|
|
|
|
|
|
|
|||
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Share-based compensation |
|
|
|
|
|
|
|
|
( |
) |
||
Income before taxes |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment |
|
|
|
|
|
|
|
|
|
|||
|
|
For the Nine Months Ended |
|
|||||||||
|
|
March 30, 2025 |
|
|||||||||
|
|
MasterCraft |
|
|
Pontoon |
|
|
Consolidated |
|
|||
Net sales |
|
$ |
|
|
$ |
|
|
$ |
|
|||
Cost of sales |
|
|
|
|
|
|
|
|
|
|||
Operating expenses(1) |
|
|
|
|
|
|
|
|
|
|||
Adjustments: |
|
|
|
|
|
|
|
|
|
|||
Depreciation and amortization |
|
|
|
|
|
|
|
|
|
|||
Adjustment items(2) |
|
|
|
|
|
|
|
|
|
|||
Adjusted EBITDA |
|
|
|
|
|
( |
) |
|
|
|
||
Less: Interest Expense |
|
|
|
|
|
|
|
|
( |
) |
||
Add: Interest Income |
|
|
|
|
|
|
|
|
|
|||
Less: Depreciation and amortization |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Share-based compensation |
|
|
|
|
|
|
|
|
( |
) |
||
Less: Senior leadership transition and organizational realignment costs |
|
|
|
|
|
|
|
|
( |
) |
||
Income before taxes |
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|||
Purchases of property, plant and equipment |
|
|
|
|
|
|
|
|
|
|||
The following table presents total assets for the Company’s reportable segments.
|
|
March 29, 2026 |
|
|
June 30, 2025 |
|
||
Assets: |
|
|
|
|
|
|
||
MasterCraft |
|
$ |
|
|
$ |
|
||
Pontoon |
|
|
|
|
|
|
||
Total assets |
|
$ |
|
|
$ |
|
||
17
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion and analysis should be read together with the unaudited condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q. In addition, the statements in this discussion and analysis regarding our expectations concerning the performance of our business, anticipated financial results, liquidity and the other non-historical statements are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties, including, but not limited to, the risks and uncertainties described in “Cautionary Note Regarding Forward-Looking Statements” above and in “Risk Factors” set forth in our 2025 Annual Report. Our actual results may differ materially from those contained in or implied by any forward-looking statements.
Certain statements in the following discussions are based on non-GAAP financial measures. A “non-GAAP financial measure” is a numerical measure of a registrant’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with U.S. GAAP in the statements of operations, balance sheets or statements of cash flows of the issuer; or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. Non-GAAP financial measures do not include operating and statistical measures. The Company includes non-GAAP financial measures in Management’s Discussion and Analysis, as the Company’s management believes that these measures and the information they provide are useful to users of the financial statements, including investors, because they permit users of the financial statements to view the Company’s performance using the same tools that management utilizes and to better evaluate the Company’s ongoing business performance. In order to better align the Company’s reported results with the internal metrics used by the Company's management to evaluate business performance as well as to provide better comparisons to prior periods and peer data, non-GAAP measures exclude the impact of purchase accounting amortization related to business acquisitions.
Overview
The Company’s results for all periods presented, as discussed in Management’s Discussion and Analysis, are presented on a continuing operations basis, which consists of our MasterCraft and Pontoon segments.
Marine Products Transaction
On February 5, 2026, the Company announced that it had entered into the Marine Products Transaction. The Marine Products Transaction is expected to close shortly after our special meeting of shareholders, scheduled May 12, 2026, subject to approval by both the Company's and Marine Products’ shareholders and the satisfaction of other customary closing conditions.
Results of Operations
Despite recent geopolitical and macroeconomic uncertainty, the Company delivered increased net sales of $2.2 million and increased gross margin of 420 basis points for the third quarter of fiscal 2026, when compared with the same prior-year period. These increases were primarily driven by favorable model mix and option sales, increased prices, and decreased dealer incentives, while maintaining effective cost controls, partially offset by lower unit volumes.
18
Results of Continuing Operations
Consolidated Results
The table below presents our consolidated results of operations for the three and nine months ended:
|
|
Three Months Ended |
|
|
2026 vs. 2025 |
|
|
Nine Months Ended |
|
|
2026 vs. 2025 |
|
||||||||||||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
||||||||
|
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
||||||||
(Dollar amounts in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Consolidated statements of operations: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
NET SALES |
|
$ |
78,206 |
|
|
$ |
75,960 |
|
|
$ |
2,246 |
|
|
|
3.0 |
% |
|
$ |
218,967 |
|
|
$ |
204,687 |
|
|
$ |
14,280 |
|
|
|
7.0 |
% |
COST OF SALES |
|
|
58,664 |
|
|
|
60,195 |
|
|
|
(1,531 |
) |
|
|
(2.5 |
%) |
|
|
168,502 |
|
|
|
166,232 |
|
|
|
2,270 |
|
|
|
1.4 |
% |
GROSS PROFIT |
|
|
19,542 |
|
|
|
15,765 |
|
|
|
3,777 |
|
|
|
24.0 |
% |
|
|
50,465 |
|
|
|
38,455 |
|
|
|
12,010 |
|
|
|
31.2 |
% |
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Selling and marketing |
|
|
3,360 |
|
|
|
2,845 |
|
|
|
515 |
|
|
|
18.1 |
% |
|
|
9,649 |
|
|
|
8,543 |
|
|
|
1,106 |
|
|
|
12.9 |
% |
General and administrative |
|
|
17,030 |
|
|
|
8,356 |
|
|
|
8,674 |
|
|
|
103.8 |
% |
|
|
34,267 |
|
|
|
23,258 |
|
|
|
11,009 |
|
|
|
47.3 |
% |
Amortization of other intangible assets |
|
|
450 |
|
|
|
450 |
|
|
|
— |
|
|
|
— |
|
|
|
1,350 |
|
|
|
1,350 |
|
|
|
— |
|
|
|
— |
|
Total operating expenses |
|
|
20,840 |
|
|
|
11,651 |
|
|
|
9,189 |
|
|
|
78.9 |
% |
|
|
45,266 |
|
|
|
33,151 |
|
|
|
12,115 |
|
|
|
36.5 |
% |
OPERATING INCOME (LOSS) |
|
|
(1,298 |
) |
|
|
4,114 |
|
|
|
(5,412 |
) |
|
|
(131.6 |
%) |
|
|
5,199 |
|
|
|
5,304 |
|
|
|
(105 |
) |
|
|
(2.0 |
%) |
OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Interest expense |
|
|
(58 |
) |
|
|
— |
|
|
|
(58 |
) |
|
|
— |
|
|
|
(146 |
) |
|
|
(1,169 |
) |
|
|
1,023 |
|
|
|
(87.5 |
%) |
Interest income |
|
|
760 |
|
|
|
760 |
|
|
|
— |
|
|
|
— |
|
|
|
2,257 |
|
|
|
2,649 |
|
|
|
(392 |
) |
|
|
(14.8 |
%) |
Loss on extinguishment of debt |
|
|
(71 |
) |
|
|
— |
|
|
|
(71 |
) |
|
|
— |
|
|
|
(71 |
) |
|
|
— |
|
|
|
(71 |
) |
|
|
0.0 |
% |
INCOME (LOSS) BEFORE INCOME TAX EXPENSE |
|
|
(667 |
) |
|
|
4,874 |
|
|
|
(5,541 |
) |
|
|
(113.7 |
%) |
|
|
7,239 |
|
|
|
6,784 |
|
|
|
455 |
|
|
|
6.7 |
% |
INCOME TAX EXPENSE |
|
|
49 |
|
|
|
1,053 |
|
|
|
(1,004 |
) |
|
|
(95.3 |
%) |
|
|
1,811 |
|
|
|
1,521 |
|
|
|
290 |
|
|
|
19.1 |
% |
INCOME (LOSS) FROM CONTINUING OPERATIONS |
|
$ |
(716 |
) |
|
$ |
3,821 |
|
|
$ |
(4,537 |
) |
|
|
(118.7 |
%) |
|
$ |
5,428 |
|
|
$ |
5,263 |
|
|
$ |
165 |
|
|
|
3.1 |
% |
Additional financial and other data: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unit sales volume: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
MasterCraft |
|
|
409 |
|
|
|
422 |
|
|
|
(13 |
) |
|
|
(3.1 |
%) |
|
|
1,195 |
|
|
|
1,196 |
|
|
|
(1 |
) |
|
|
(0.1 |
%) |
Pontoon |
|
|
162 |
|
|
|
197 |
|
|
|
(35 |
) |
|
|
(17.8 |
%) |
|
|
524 |
|
|
|
527 |
|
|
|
(3 |
) |
|
|
(0.6 |
%) |
Consolidated unit sales volume |
|
|
571 |
|
|
|
619 |
|
|
|
(48 |
) |
|
|
(7.8 |
%) |
|
|
1,719 |
|
|
|
1,723 |
|
|
|
(4 |
) |
|
|
(0.2 |
%) |
Net sales: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
MasterCraft |
|
$ |
66,764 |
|
|
$ |
64,227 |
|
|
$ |
2,537 |
|
|
|
4.0 |
% |
|
$ |
186,647 |
|
|
$ |
174,857 |
|
|
$ |
11,790 |
|
|
|
6.7 |
% |
Pontoon |
|
|
11,442 |
|
|
|
11,733 |
|
|
|
(291 |
) |
|
|
(2.5 |
%) |
|
|
32,320 |
|
|
|
29,830 |
|
|
|
2,490 |
|
|
|
8.3 |
% |
Consolidated net sales |
|
$ |
78,206 |
|
|
$ |
75,960 |
|
|
$ |
2,246 |
|
|
|
3.0 |
% |
|
$ |
218,967 |
|
|
$ |
204,687 |
|
|
$ |
14,280 |
|
|
|
7.0 |
% |
Net sales per unit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
MasterCraft |
|
$ |
163 |
|
|
$ |
152 |
|
|
$ |
11 |
|
|
|
7.2 |
% |
|
$ |
156 |
|
|
$ |
146 |
|
|
$ |
10 |
|
|
|
6.8 |
% |
Pontoon |
|
|
71 |
|
|
|
60 |
|
|
|
11 |
|
|
|
18.3 |
% |
|
|
62 |
|
|
|
57 |
|
|
|
5 |
|
|
|
8.8 |
% |
Consolidated net sales per unit |
|
|
137 |
|
|
|
123 |
|
|
|
14 |
|
|
|
11.4 |
% |
|
|
127 |
|
|
|
119 |
|
|
|
8 |
|
|
|
6.7 |
% |
Gross margin |
|
|
25.0 |
% |
|
|
20.8 |
% |
|
420 bps |
|
|
|
23.0 |
% |
|
|
18.8 |
% |
|
420 bps |
|
||||||||||
Net sales increased $2.2 million during the third quarter of fiscal 2026, when compared with the same prior-year period. The increase in net sales was driven by favorable model mix and option sales, increased prices, and decreased dealer incentives, partially offset by lower unit volumes.
Net sales increased $14.3 million during the first nine months of fiscal 2026, when compared with the same prior year period, due to favorable model mix and option sales, increased prices, and decreased dealer incentives.
Gross margin percentage increased 420 basis points during both the third quarter and first nine months of fiscal 2026, when compared with the same prior year periods. Higher margins were primarily the result of increased net sales, as discussed above, combined with effective cost controls.
19
Operating expenses increased $9.2 million and $12.1 million during the third quarter and first nine months of fiscal 2026, respectively, when compared with the same prior year periods, due to business development and consulting costs related to the Marine Products Transaction, increased selling and marketing costs, and ERP implementation costs.
Segment Results
MasterCraft Segment
The following table sets forth MasterCraft segment results for the three and nine months ended:
|
|
Three Months Ended |
|
|
2026 vs. 2025 |
|
|
Nine Months Ended |
|
|
2026 vs. 2025 |
|
||||||||||||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
||||||||
(Dollar amounts in thousands) |
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
||||||||
Net sales |
|
$ |
66,764 |
|
|
$ |
64,227 |
|
|
$ |
2,537 |
|
|
|
4.0 |
% |
|
$ |
186,647 |
|
|
$ |
174,857 |
|
|
$ |
11,790 |
|
|
|
6.7 |
% |
Operating income |
|
|
277 |
|
|
|
5,792 |
|
|
|
(5,515 |
) |
|
|
(95.2 |
%) |
|
|
10,834 |
|
|
|
12,864 |
|
|
|
(2,030 |
) |
|
|
(15.8 |
%) |
Purchases of property, plant and equipment |
|
|
836 |
|
|
|
1,778 |
|
|
|
(942 |
) |
|
|
(53.0 |
%) |
|
|
4,797 |
|
|
|
5,459 |
|
|
|
(662 |
) |
|
|
(12.1 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unit sales volume |
|
|
409 |
|
|
|
422 |
|
|
|
(13 |
) |
|
|
(3.1 |
%) |
|
|
1,195 |
|
|
|
1,196 |
|
|
|
(1 |
) |
|
|
(0.1 |
%) |
Net sales per unit |
|
$ |
163 |
|
|
$ |
152 |
|
|
$ |
11 |
|
|
|
7.2 |
% |
|
$ |
156 |
|
|
$ |
146 |
|
|
$ |
10 |
|
|
|
6.8 |
% |
Net sales increased $2.5 million and $11.8 million during the third quarter and first nine months of fiscal 2026, respectively, when compared with the same prior year periods. The increase was driven by favorable model mix and option sales, increased prices, and decreased dealer incentives, partially offset by lower unit volumes.
Operating income decreased $5.5 million and $2.0 million during third quarter and first nine months of fiscal 2026, respectively, when compared with the same prior year periods. The change was primarily the result of increased operating expenses, partially offset by increased net sales, as discussed above.
Pontoon Segment
The following table sets forth Pontoon segment results for the three and nine months ended:
|
|
Three Months Ended |
|
|
2026 vs. 2025 |
|
|
Nine Months Ended |
|
|
2026 vs. 2025 |
|
||||||||||||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
|
March 29, |
|
|
March 30, |
|
|
|
|
|
% |
|
||||||||
(Dollar amounts in thousands) |
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
|
2026 |
|
|
2025 |
|
|
Change |
|
|
Change |
|
||||||||
Net sales |
|
$ |
11,442 |
|
|
$ |
11,733 |
|
|
$ |
(291 |
) |
|
|
(2.5 |
%) |
|
$ |
32,320 |
|
|
$ |
29,830 |
|
|
$ |
2,490 |
|
|
|
8.3 |
% |
Operating loss |
|
|
(1,575 |
) |
|
|
(1,678 |
) |
|
|
103 |
|
|
|
(6.1 |
%) |
|
|
(5,635 |
) |
|
|
(7,560 |
) |
|
|
1,925 |
|
|
|
(25.5 |
%) |
Purchases of property, plant and equipment |
|
|
203 |
|
|
|
233 |
|
|
|
(30 |
) |
|
|
(12.9 |
%) |
|
|
949 |
|
|
|
1,147 |
|
|
|
(198 |
) |
|
|
(17.3 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Unit sales volume |
|
|
162 |
|
|
|
197 |
|
|
|
(35 |
) |
|
|
(17.8 |
%) |
|
|
524 |
|
|
|
527 |
|
|
|
(3 |
) |
|
|
(0.6 |
%) |
Net sales per unit |
|
$ |
71 |
|
|
$ |
60 |
|
|
$ |
11 |
|
|
|
18.3 |
% |
|
$ |
62 |
|
|
$ |
57 |
|
|
$ |
5 |
|
|
|
8.8 |
% |
Net sales decreased $0.3 million during the third quarter of fiscal 2026, when compared with the same prior-year period, primarily due to lower unit volumes, partially offset by favorable option sales, increased prices, and decreased dealer incentives.
Net sales increased $2.5 million during the first nine months of fiscal 2026, when compared to the same prior-year period, primarily due to favorable option sales, increased prices, and decreased dealer incentives, partially offset by unfavorable model mix.
Operating loss for the third quarter of fiscal 2026 decreased $0.1 million, when compared with the same prior-year period, due to effective cost controls, partially offset by decreased net sales, as discussed above.
Operating loss for the first nine months of fiscal 2026 decreased $1.9 million, when compared with the same prior-year periods, due to increased net sales, as discussed above, and effective cost controls.
20
Non-GAAP Measures
EBITDA, Adjusted EBITDA, EBITDA margin, and Adjusted EBITDA margin
We define EBITDA as income (loss) 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, the adjustments are for share-based compensation, senior leadership transition and organizational realignment costs, ERP implementation costs, and business development and consulting costs. We define EBITDA margin and Adjusted EBITDA margin as EBITDA and Adjusted EBITDA, respectively, each expressed as a percentage of Net sales.
Adjusted Net Income and Adjusted Net Income per share
We define Adjusted Net Income as income (loss) 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. We define Adjusted Net Income per Share as Adjusted Net Income divided by the weighted-average basic and diluted shares outstanding. 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, and business development and consulting costs.
Free Cash Flow
We define Free Cash Flow from continuing operations as net cash flows from operating activities less purchases of property, plant, and equipment.
EBITDA, Adjusted EBITDA, EBITDA margin, Adjusted EBITDA margin, Adjusted Net Income, Adjusted Net Income per share, and Free Cash Flow, which we refer to collectively as the Non-GAAP Measures, are not measures of net income (loss), operating income (loss), or net operating cash flows as determined under accounting principles generally accepted in the United States, or U.S. GAAP. The Non-GAAP Measures are not measures of performance in accordance with U.S. GAAP and should not be considered as an alternative to net income (loss), net income (loss) per share, or net operating cash flows determined in accordance with U.S. GAAP. Additionally, Adjusted EBITDA is not intended to be a measure of cash flow. We believe that the inclusion of the Non-GAAP Measures is appropriate to provide additional information to investors because securities analysts and investors use the Non-GAAP Measures to assess our operating performance across periods on a consistent basis and to evaluate the relative risk of an investment in our securities. We use Adjusted Net Income and Adjusted Net Income per share to facilitate a comparison of our operating performance on a consistent basis from period to period that, when viewed in combination with our results prepared in accordance with U.S. GAAP, provides a more complete understanding of factors and trends affecting our business than does U.S. GAAP measures alone. We believe Adjusted Net Income and Adjusted Net Income per share assists our Board, management, investors, and other users of the financial statements in comparing our net income (loss) on a consistent basis from period to period because it removes certain non-cash items and 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. The Non-GAAP Measures have limitations as an analytical tool and should not be considered in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. Some of these limitations are:
21
In addition, because not all companies use identical calculations, our presentation of the Non-GAAP Measures may not be comparable to similarly titled measures of other companies, including companies in our industry.
The following table presents a reconciliation of income (loss) from continuing operations as determined in accordance with U.S. GAAP to EBITDA, and Adjusted EBITDA, and income (loss) from continuing operations margin (expressed as a percentage of net sales) to EBITDA margin and Adjusted EBITDA margin (each expressed as a percentage of net sales) for the periods indicated:
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||||||||||
|
|
March 29, |
|
|
% of Net |
|
March 30, |
|
|
% of Net |
|
March 29, |
|
|
% of Net |
|
March 30, |
|
|
% of Net |
||||
(Dollar amounts in thousands) |
|
2026 |
|
|
sales |
|
2025 |
|
|
sales |
|
2026 |
|
|
sales |
|
2025 |
|
|
sales |
||||
Income (loss) from continuing operations |
|
$ |
(716 |
) |
|
-0.9% |
|
$ |
3,821 |
|
|
5.0% |
|
$ |
5,428 |
|
|
2.5% |
|
$ |
5,263 |
|
|
2.6% |
Income tax expense |
|
|
49 |
|
|
|
|
|
1,053 |
|
|
|
|
|
1,811 |
|
|
|
|
|
1,521 |
|
|
|
Interest expense |
|
|
58 |
|
|
|
|
|
— |
|
|
|
|
|
146 |
|
|
|
|
|
1,169 |
|
|
|
Interest income |
|
|
(760 |
) |
|
|
|
|
(760 |
) |
|
|
|
|
(2,257 |
) |
|
|
|
|
(2,649 |
) |
|
|
Depreciation and amortization |
|
|
2,482 |
|
|
|
|
|
2,569 |
|
|
|
|
|
6,960 |
|
|
|
|
|
7,024 |
|
|
|
EBITDA |
|
|
1,113 |
|
|
1.4% |
|
|
6,683 |
|
|
8.8% |
|
|
12,088 |
|
|
5.5% |
|
|
12,328 |
|
|
6.0% |
Share-based compensation |
|
|
894 |
|
|
|
|
|
805 |
|
|
|
|
|
2,688 |
|
|
|
|
|
2,080 |
|
|
|
Senior leadership transition and organizational realignment costs(a) |
|
|
— |
|
|
|
|
|
— |
|
|
|
|
|
196 |
|
|
|
|
|
448 |
|
|
|
ERP implementation costs(b) |
|
|
291 |
|
|
|
|
|
— |
|
|
|
|
|
784 |
|
|
|
|
|
— |
|
|
|
Business development and consulting costs(c) |
|
|
8,425 |
|
|
|
|
|
— |
|
|
|
|
|
9,394 |
|
|
|
|
|
— |
|
|
|
Adjusted EBITDA |
|
$ |
10,723 |
|
|
13.7% |
|
$ |
7,488 |
|
|
9.9% |
|
$ |
25,150 |
|
|
11.5% |
|
$ |
14,856 |
|
|
7.3% |
22
The following table presents a reconciliation of income (loss) from continuing operations as determined in accordance with U.S. GAAP to Adjusted Net Income for the periods indicated:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
March 29, |
|
|
March 30, |
|
||||
(Dollar amounts in thousands, except per share data) |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Income (loss) from continuing operations |
|
$ |
(716 |
) |
|
$ |
3,821 |
|
|
$ |
5,428 |
|
|
$ |
5,263 |
|
Income tax expense |
|
|
49 |
|
|
|
1,053 |
|
|
|
1,811 |
|
|
|
1,521 |
|
Amortization of acquisition intangibles |
|
|
450 |
|
|
|
450 |
|
|
|
1,350 |
|
|
|
1,350 |
|
Share-based compensation |
|
|
894 |
|
|
|
805 |
|
|
|
2,688 |
|
|
|
2,080 |
|
Senior leadership transition and organizational realignment costs(a) |
|
|
— |
|
|
|
— |
|
|
|
196 |
|
|
|
448 |
|
ERP implementation costs(b) |
|
|
291 |
|
|
|
— |
|
|
|
784 |
|
|
|
— |
|
Business development and consulting costs(c) |
|
|
8,425 |
|
|
|
— |
|
|
|
9,394 |
|
|
|
— |
|
Adjusted Net Income before income taxes |
|
|
9,393 |
|
|
|
6,129 |
|
|
|
21,651 |
|
|
|
10,662 |
|
Adjusted income tax expense(d) |
|
|
2,160 |
|
|
|
1,103 |
|
|
|
4,980 |
|
|
|
1,919 |
|
Adjusted Net Income |
|
$ |
7,233 |
|
|
$ |
5,026 |
|
|
$ |
16,671 |
|
|
$ |
8,743 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted Net Income per share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
0.45 |
|
|
$ |
0.31 |
|
|
$ |
1.03 |
|
|
$ |
0.53 |
|
Diluted |
|
$ |
0.45 |
|
|
$ |
0.30 |
|
|
$ |
1.03 |
|
|
$ |
0.53 |
|
Weighted average shares used for the computation of(e): |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic Adjusted Net Income per share |
|
|
16,136,132 |
|
|
|
16,414,340 |
|
|
|
16,147,425 |
|
|
|
16,471,352 |
|
Diluted Adjusted Net Income per share |
|
|
16,136,132 |
|
|
|
16,540,345 |
|
|
|
16,263,844 |
|
|
|
16,554,235 |
|
The following table presents the reconciliation of income (loss) from continuing operations per diluted share to Adjusted Net Income per diluted share for the periods indicated:
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
March 29, |
|
|
March 30, |
|
|
March 29, |
|
|
March 30, |
|
||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Income (loss) from continuing operations per diluted share |
|
$ |
(0.04 |
) |
|
$ |
0.23 |
|
|
$ |
0.33 |
|
|
$ |
0.32 |
|
Impact of adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income tax expense |
|
|
— |
|
|
|
0.06 |
|
|
|
0.11 |
|
|
|
0.09 |
|
Amortization of acquisition intangibles |
|
|
0.03 |
|
|
|
0.03 |
|
|
|
0.08 |
|
|
|
0.08 |
|
Share-based compensation |
|
|
0.06 |
|
|
|
0.05 |
|
|
|
0.17 |
|
|
|
0.13 |
|
Senior leadership transition and organizational realignment costs(a) |
|
|
— |
|
|
|
— |
|
|
|
0.01 |
|
|
|
0.03 |
|
ERP implementation costs(b) |
|
|
0.02 |
|
|
|
— |
|
|
|
0.05 |
|
|
|
— |
|
Business development and consulting costs(c) |
|
|
0.52 |
|
|
|
— |
|
|
|
0.58 |
|
|
|
— |
|
Adjusted Net Income per diluted share before income taxes |
|
|
0.59 |
|
|
|
0.37 |
|
|
|
1.33 |
|
|
|
0.65 |
|
Impact of adjusted income tax expense on net income per diluted share before income taxes(d) |
|
|
(0.14 |
) |
|
|
(0.07 |
) |
|
|
(0.30 |
) |
|
|
(0.12 |
) |
Adjusted Net Income per diluted share |
|
|
0.45 |
|
|
$ |
0.30 |
|
|
|
1.03 |
|
|
$ |
0.53 |
|
23
The following table presents a reconciliation of net cash flows by operating activities of continuing operations as determined in accordance with U.S. GAAP to Free Cash Flow for the periods presented:
|
|
Nine Months Ended |
|
|||||
|
|
March 29, |
|
|
March 30, |
|
||
|
|
2026 |
|
|
2025 |
|
||
|
|
|
|
|
|
|
||
Net cash used in operating activities of continuing operations |
|
$ |
13,387 |
|
|
$ |
18,457 |
|
Less: |
|
|
|
|
|
|
||
Purchases of property, plant and equipment |
|
|
(5,746 |
) |
|
|
(6,606 |
) |
Free cash flow |
|
$ |
7,641 |
|
|
$ |
11,851 |
|
Liquidity and Capital Resources
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, short-term investments, 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, short-term investments, cash from operations, and our ability to borrow will be sufficient to provide for our liquidity and capital resource needs.
Cash and cash equivalents totaled $75.4 million as of March 29, 2026, an increase of $46.5 million from $28.9 million as of June 30, 2025. Short-term investments totaled $9.2 million as of March 29, 2026, a decrease of $41.3 million from $50.5 million as of June 30, 2025. As of March 29, 2026, and June 30, 2025, we had no long-term debt outstanding and $75.0 million and $100.0 million, respectively, available borrowing capacity under the Revolving Credit Facility.
On July 24, 2023, the Board of the Company authorized a share repurchase program under which the Company may repurchase up to $50 million of its outstanding shares of common stock. During the nine months ended March 29, 2026, the Company repurchased 116,370 shares of common stock for $2.3 million in cash, excluding related fees and expenses.
The following table and discussion below relate to our cash flows from continuing operations from operating, investing, and financing activities:
|
|
Nine Months Ended |
|
|||||
|
|
March 29, |
|
|
March 30, |
|
||
(Dollar amounts in thousands) |
|
2026 |
|
|
2025 |
|
||
Total cash provided by (used in): |
|
|
|
|
|
|
||
Operating activities |
|
$ |
13,387 |
|
|
$ |
18,457 |
|
Investing activities |
|
|
35,826 |
|
|
|
34,960 |
|
Financing activities |
|
|
(2,889 |
) |
|
|
(54,988 |
) |
Net change in cash and cash equivalents from continuing operations |
|
$ |
46,324 |
|
|
$ |
(1,571 |
) |
Nine Months Ended March 29, 2026 Cash Flows from Continuing Operations
Net cash provided by operating activities for the nine months ended March 29, 2026 was $13.4 million, primarily due to net income, partially offset by working capital usage. 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. Working capital usage primarily consisted of an increase in accounts receivable, inventories, and prepaid expenses and other current assets, partially offset by an increase in accounts payable. Accounts
24
receivable increased due to timing of sales at the end of the period compared to the end of the prior-year period. Inventories increased due to timing of raw material purchases compared to the end of the prior-year period, along with a subsequent increase in production. Prepaid and other current assets increased due to payment of annual general insurance premiums. Accounts payable increased due to timing of professional fee payments related to the Marine Products Transaction, timing of insurance related payments, and timing of purchases at the end of the period compared to the prior-year period.
Net cash provided by investing activities was $35.8 million, which included $41.6 million of net proceeds in available-for-sale securities, partially offset by $5.7 million in capital expenditures. Our capital spending was primarily focused on tooling, information technology, and machinery and equipment.
Net cash used in financing activities was $2.9 million, primarily due to share repurchases totaling $2.3 million, excluding related fees and expenses.
Nine Months Ended March 30, 2025 Cash Flows from Continuing Operations
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. 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.
Net cash provided by investing activities was $35.0 million, which included $41.6 million of 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.
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 Company's previous term loan. Drawn amounts on the Revolving Credit Facility were fully repaid as of March 30, 2025.
Off Balance Sheet Arrangements
The Company did not have any off balance sheet financing arrangements as of March 29, 2026.
Critical Accounting Estimates
As of March 29, 2026, there were no significant changes in or changes to the application of our critical accounting policies or estimation procedures from those presented in our 2025 Annual Report.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Refer to our 2025 Annual Report for discussion of the Company’s market risk. There have been no material changes in market risk from those disclosed therein.
ITEM 4. CONTROLS AND PROCEDURES.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) (of the Exchange Act) that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
25
As of the end of the period covered by this Quarterly Report on Form 10-Q, we carried out an evaluation under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of our disclosure controls and procedures. Based upon this evaluation, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of March 29, 2026.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during the quarter ended March 29, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
26
PART II – OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
For a discussion of the Company’s legal proceedings, see Part I – Item 1. – Note 9 – Commitments and Contingencies to the Company’s unaudited condensed consolidated financial statements.
ITEM 1A. RISK FACTORS.
During the nine months ended March 29, 2026, there have been no material changes to the risk factors disclosed in “Part I, Item 1A. Risk Factors” in our 2025 Annual Report.
ITEM 2. UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS.
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 first nine months of fiscal 2026, we repurchased approximately $2.3 million of our common stock, excluding related fees and expenses. As of March 29, 2026, the remaining authorization under the program was approximately $23.5 million.
During the three months ended March 29, 2026, the Company did not repurchase any shares of its common stock.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. MINE SAFETY DISCLOSURES.
None.
ITEM 5. OTHER INFORMATION.
During the three months ended March 29, 2026, none of our directors or “officers” (as defined in Rule 16a-1(f) under the Exchange Act)
27
ITEM 6. EXHIBITS, FINANCIAL STATEMENT SCHEDULES.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference |
|
||||||||
Exhibit |
|
Description |
|
Form |
|
File No. |
|
Exhibit |
|
Filing Date |
|
Filed |
|
2.1*** |
|
Agreement and Plan of Merger, dated as of February 5, 2026, by and among MasterCraft Boat Holdings, Inc., Titan Merger Sub 1, Inc., Titan Merger Sub 2, LLC and Marine Product Corporation |
|
8-K |
|
001-37502 |
|
2.1 |
|
2/5/26 |
|
|
|
3.1 |
|
Amended and Restated Certificate of Incorporation of MCBC Holdings, Inc. |
|
10-K |
|
001-37502 |
|
3.1 |
|
9/18/15 |
|
|
|
3.2 |
|
Certificate of Amendment to Amended and Restated Certificate of Incorporation of MasterCraft Boat Holdings, Inc. |
|
10-Q |
|
001-37502 |
|
3.2 |
|
11/9/18 |
|
|
|
3.3 |
|
Certificate of Amendment to Amended and Restated Certificate of Incorporation of MasterCraft Boat Holdings, Inc. |
|
8-K |
|
001-37502 |
|
3.1 |
|
10/25/19 |
|
|
|
3.4 |
|
Fourth Amended and Restated By-laws of MasterCraft Boat Holdings, Inc. |
|
8-K |
|
001-37502 |
|
3.2 |
|
10/25/19 |
|
|
|
3.5 |
|
Certificate of Correction to the Amended and Restated Certificate of Incorporation of MasterCraft Boat Holdings, Inc. |
|
S-4
|
|
333-294312
|
|
3.5
|
|
3/16/26
|
|
|
|
10.1*** |
|
Voting Agreement, date as of February 5, 2026, by and among MasterCraft Boat Holdings, Inc., Marine Products Corporation, and certain stockholders identified in an exhibit thereto |
|
8-K
|
|
001-37502
|
|
10.1
|
|
2/5/26
|
|
|
|
10.2*** |
|
Stockholders Agreement, dated as of February 5, 2026, by and among MasterCraft Boat Holdings, Inc. and the stockholders identified in an exhibit thereto |
|
8-K
|
|
001-37502
|
|
10.2
|
|
2/5/26
|
|
|
|
10.3*** |
|
First Amendment to the Stockholders Agreement, dated as of March 11, 2026, by and among MasterCraft Boat Holdings, Inc. and the stockholders party thereto |
|
S-4
|
|
333-294312
|
|
10.3
|
|
3/16/26
|
|
|
|
10.4*** |
|
Registration Rights Agreement, dated as of February 5, 2026, by and among MasterCraft Boat Holdings, Inc. and LOR, Inc. |
|
8-K
|
|
001-37502
|
|
10.3
|
|
2/5/26
|
|
|
|
10.5*** |
|
Fifth Amendment to the Credit Agreement |
|
8-K |
|
001-37502 |
|
10.4 |
|
2/5/26 |
|
|
|
10.6† |
|
Executive Severance Plan |
|
8-K |
|
001-37502 |
|
10.5 |
|
2/5/26 |
|
|
|
31.1 |
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer |
|
|
|
|
|
|
|
|
|
* |
|
31.2 |
|
Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer |
|
|
|
|
|
|
|
|
|
* |
|
32.1 |
|
Section 1350 Certification of Chief Executive Officer |
|
|
|
|
|
|
|
|
|
** |
|
32.2 |
|
Section 1350 Certification of Chief Financial Officer |
|
|
|
|
|
|
|
|
|
** |
|
101.INS |
|
Inline XBRL Instance Document |
|
|
|
|
|
|
|
|
|
* |
|
101.SCH |
|
Inline XBRL Taxonomy Extension Schema With Embedded Linkbases Document |
|
|
|
|
|
|
|
|
|
* |
|
104 |
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
|
|
|
|
|
|
|
|
|
* |
|
* Filed herewith.
** Furnished herewith.
*** Schedules (or similar attachments) have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company hereby undertakes to furnish supplemental copies of any of the omitted schedules (or similar attachments) upon request by the U.S. Securities and Exchange Commission; provided that the registrant may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedules (or similar attachments) so furnished.
† Indicates management contract or compensatory plan.
28
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
MASTERCRAFT BOAT HOLDINGS, INC. |
|
|
|
(Registrant) |
|
|
|
|
|
Date: |
May 7, 2026 |
By: |
/s/ BRADLEY M. NELSON |
|
|
|
Bradley M. Nelson |
|
|
|
Chief Executive Officer (Principal Executive Officer) and Director |
|
|
|
|
Date: |
May 7, 2026 |
By: |
/s/ W. SCOTT KENT |
|
|
|
W. Scott Kent |
|
|
|
Chief Financial Officer (Principal Financial and Accounting Officer), |
|
|
|
Treasurer and Secretary |
|
|
|
|
29