þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 83-4330138 | |||||
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) | |||||
6275 Lanier Islands Parkway Buford, Georgia | 30518 | |||||
(Address of principal executive offices) | (Zip code) |
Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | ||||||||||||
Class A common stock, par value $0.01 per share | ONEW | The Nasdaq Global Market |
Large accelerated filer | Accelerated filer | x | ||||||||||||
Non-accelerated filer | Smaller reporting company | o | ||||||||||||
Emerging growth company | o |
Page | ||||||||
December 31, 2022 | September 30, 2022 | |||||||
Assets | ||||||||
Current assets: | ||||||||
Cash | $ | 43,535 | $ | 42,071 | ||||
Restricted cash | 14,673 | 18,876 | ||||||
Accounts receivable, net | 63,613 | 57,960 | ||||||
Inventories, net | 527,023 | 372,959 | ||||||
Prepaid expenses and other current assets | 61,548 | 75,024 | ||||||
Total current assets | 710,392 | 566,890 | ||||||
Property and equipment, net | 114,802 | 109,713 | ||||||
Operating lease right-of-use assets | 126,760 | 123,955 | ||||||
Other assets: | ||||||||
Other assets | 3,844 | 3,378 | ||||||
Deferred tax assets, net | 7,248 | 8,433 | ||||||
Intangible assets, net | 311,579 | 306,471 | ||||||
Goodwill | 397,468 | 378,588 | ||||||
Total other assets | 720,139 | 696,870 | ||||||
Total assets | $ | 1,672,093 | $ | 1,497,428 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 25,859 | $ | 27,306 | ||||
Other payables and accrued expenses | 44,835 | 55,237 | ||||||
Customer deposits | 60,084 | 65,460 | ||||||
Notes payable – floor plan | 425,368 | 267,108 | ||||||
Current portion of operating lease liabilities | 13,410 | 12,981 | ||||||
Current portion of long-term debt, net | 29,247 | 21,642 | ||||||
Current portion of tax receivable agreement liability | 2,363 | 2,363 | ||||||
Total current liabilities | 601,166 | 452,097 | ||||||
Long-term Liabilities: | ||||||||
Other long-term liabilities | 19,850 | 23,174 | ||||||
Tax receivable agreement liability | 43,991 | 43,991 | ||||||
Noncurrent operating lease liabilities | 114,601 | 112,127 | ||||||
Long-term debt, net | 434,670 | 421,162 | ||||||
Total liabilities | 1,214,278 | 1,052,551 | ||||||
Stockholders’ Equity: | ||||||||
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued and outstanding as of December 31, 2022 and September 30, 2022 | - | - | ||||||
Class A common stock, $0.01 par value, 40,000,000 shares authorized, 14,297,607 shares issued and outstanding as of December 31, 2022 and 14,211,621 issued and outstanding as of September 30, 2022 | 143 | 142 | ||||||
Class B common stock, $0.01 par value, 10,000,000 shares authorized, 1,429,940 shares issued and outstanding as of December 31, 2022 and September 30, 2022 | 14 | 14 | ||||||
Additional paid-in capital | 182,113 | 180,296 | ||||||
Retained earnings | 213,770 | 204,880 | ||||||
Accumulated other comprehensive income (loss) | 3 | (7 | ) | |||||
Total stockholders’ equity attributable to OneWater Marine Inc. | 396,043 | 385,325 | ||||||
Equity attributable to non-controlling interests | 61,772 | 59,552 | ||||||
Total stockholders’ equity | 457,815 | 444,877 | ||||||
Total liabilities and stockholders’ equity | $ | 1,672,093 | $ | 1,497,428 |
June 30, 2023 | September 30, 2022 | ||||||||||
ASSETS | |||||||||||
CURRENT ASSETS: | |||||||||||
Cash | $ | 45,409 | $ | 42,071 | |||||||
Restricted cash | 7,753 | 18,876 | |||||||||
Accounts receivable, net | 93,972 | 57,960 | |||||||||
Inventories, net | 572,932 | 372,959 | |||||||||
Prepaid expenses and other current assets | 88,399 | 75,024 | |||||||||
Total current assets | 808,465 | 566,890 | |||||||||
Property and equipment, net | 118,965 | 109,713 | |||||||||
Operating lease right-of-use assets | 127,973 | 123,955 | |||||||||
Other long-term assets | 6,062 | 3,378 | |||||||||
Deferred tax assets, net | 5,607 | 8,433 | |||||||||
Intangible assets, net | 306,776 | 306,471 | |||||||||
Goodwill | 397,469 | 378,588 | |||||||||
Total assets | $ | 1,771,317 | $ | 1,497,428 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
CURRENT LIABILITIES: | |||||||||||
Accounts payable | $ | 40,096 | $ | 27,306 | |||||||
Other payables and accrued expenses | 61,558 | 55,237 | |||||||||
Customer deposits | 56,123 | 65,460 | |||||||||
Notes payable – floor plan | 444,770 | 267,108 | |||||||||
Current portion of operating lease liabilities | 13,914 | 12,981 | |||||||||
Current portion of long-term debt, net | 23,896 | 21,642 | |||||||||
Current portion of tax receivable agreement liability | 2,363 | 2,363 | |||||||||
Total current liabilities | 642,720 | 452,097 | |||||||||
Other long-term liabilities | 13,597 | 23,174 | |||||||||
Tax receivable agreement liability | 43,991 | 43,991 | |||||||||
Long-term operating lease liabilities | 115,557 | 112,127 | |||||||||
Long-term debt, net | 433,889 | 421,162 | |||||||||
Total liabilities | 1,249,754 | 1,052,551 | |||||||||
STOCKHOLDERS’ EQUITY | |||||||||||
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued and outstanding as of June 30, 2023 and September 30, 2022 | - | - | |||||||||
Class A common stock, $0.01 par value, 40,000,000 shares authorized, 14,316,518 shares issued and outstanding as of June 30, 2023 and 14,211,621 issued and outstanding as of September 30, 2022 | 143 | 142 | |||||||||
Class B common stock, $0.01 par value, 10,000,000 shares authorized, 1,429,940 shares issued and outstanding as of June 30, 2023 and September 30, 2022 | 14 | 14 | |||||||||
Additional paid-in capital | 186,642 | 180,296 | |||||||||
Retained earnings | 264,325 | 204,880 | |||||||||
Accumulated other comprehensive income (loss) | 6 | (7) | |||||||||
Total stockholders’ equity attributable to OneWater Marine Inc. | 451,130 | 385,325 | |||||||||
Equity attributable to non-controlling interests | 70,433 | 59,552 | |||||||||
Total stockholders’ equity | 521,563 | 444,877 | |||||||||
Total liabilities and stockholders’ equity | $ | 1,771,317 | $ | 1,497,428 |
Three Months Ended December 31, | ||||||||
2022 | 2021 | |||||||
Revenues | ||||||||
New boat | $ | 232,405 | $ | 236,198 | ||||
Pre-owned boat | 55,778 | 53,449 | ||||||
Finance & insurance income | 8,934 | 9,307 | ||||||
Service, parts & other | 69,542 | 37,318 | ||||||
Total revenues | 366,659 | 336,272 | ||||||
Cost of sales (exclusive of depreciation and amortization shown separately below) | ||||||||
New boat | 175,258 | 175,896 | ||||||
Pre-owned boat | 40,304 | 39,370 | ||||||
Service, parts & other | 41,109 | 20,041 | ||||||
Total cost of sales | 256,671 | 235,307 | ||||||
Selling, general and administrative expenses | 77,838 | 59,096 | ||||||
Depreciation and amortization | 5,693 | 1,749 | ||||||
Transaction costs | 1,330 | 3,045 | ||||||
Change in fair value of contingent consideration | (1,409 | ) | 5,746 | |||||
Income from operations | 26,536 | 31,329 | ||||||
Other expense (income) | ||||||||
Interest expense – floor plan | 4,779 | 877 | ||||||
Interest expense – other | 7,584 | 1,529 | ||||||
Other (income) expense, net | (639 | ) | 548 | |||||
Total other expense, net | 11,724 | 2,954 | ||||||
Income before income tax expense | 14,812 | 28,375 | ||||||
Income tax expense | 3,384 | 4,889 | ||||||
Net income | 11,428 | 23,486 | ||||||
Less: Net income attributable to non-controlling interests | (1,365 | ) | - | |||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (1,163 | ) | (3,467 | ) | ||||
Net income attributable to OneWater Marine Inc. | $ | 8,900 | $ | 20,019 | ||||
Earnings per share of Class A common stock – basic | $ | 0.62 | $ | 1.50 | ||||
Earnings per share of Class A common stock – diluted | $ | 0.61 | $ | 1.45 | ||||
Basic weighted-average shares of Class A common stock outstanding | 14,297 | 13,380 | ||||||
Diluted weighted-average shares of Class A common stock outstanding | 14,587 | 13,761 |
Three Months Ended June 30, | Nine Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revenues: | |||||||||||||||||||||||
New boat | $ | 371,645 | $ | 376,886 | $ | 959,334 | $ | 903,104 | |||||||||||||||
Pre-owned boat | 111,469 | 98,181 | 242,641 | 227,484 | |||||||||||||||||||
Finance & insurance income | 19,028 | 18,979 | 43,286 | 43,234 | |||||||||||||||||||
Service, parts & other | 92,197 | 74,854 | 240,068 | 173,477 | |||||||||||||||||||
Total revenues | 594,339 | 568,900 | 1,485,329 | 1,347,299 | |||||||||||||||||||
Cost of sales (exclusive of depreciation and amortization shown separately below): | |||||||||||||||||||||||
New boat | 295,483 | 274,544 | 745,767 | 659,046 | |||||||||||||||||||
Pre-owned boat | 86,414 | 68,749 | 184,898 | 164,078 | |||||||||||||||||||
Service, parts & other | 53,008 | 41,668 | 138,545 | 96,729 | |||||||||||||||||||
Total cost of sales | 434,905 | 384,961 | 1,069,210 | 919,853 | |||||||||||||||||||
Selling, general and administrative expenses | 92,841 | 87,867 | 260,872 | 222,455 | |||||||||||||||||||
Depreciation and amortization | 5,980 | 4,073 | 17,310 | 10,549 | |||||||||||||||||||
Transaction costs | 97 | 1,337 | 1,668 | 5,158 | |||||||||||||||||||
Change in fair value of contingent consideration | 436 | 3,118 | 763 | 11,022 | |||||||||||||||||||
Income from operations | 60,080 | 87,544 | 135,506 | 178,262 | |||||||||||||||||||
Other expense (income): | |||||||||||||||||||||||
Interest expense – floor plan | 7,436 | 1,131 | 17,687 | 3,056 | |||||||||||||||||||
Interest expense – other | 9,077 | 3,311 | 25,265 | 7,937 | |||||||||||||||||||
Other expense (income), net | 361 | (166) | (465) | 491 | |||||||||||||||||||
Total other expense, net | 16,874 | 4,276 | 42,487 | 11,484 | |||||||||||||||||||
Income before income tax expense | 43,206 | 83,268 | 93,019 | 166,778 | |||||||||||||||||||
Income tax expense | 9,916 | 18,785 | 21,264 | 36,455 | |||||||||||||||||||
Net income | 33,290 | 64,483 | 71,755 | 130,323 | |||||||||||||||||||
Less: Net income attributable to non-controlling interests | (938) | (959) | (3,468) | (1,970) | |||||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (3,782) | (7,547) | (8,013) | (16,060) | |||||||||||||||||||
Net income attributable to OneWater Marine Inc. | $ | 28,570 | $ | 55,977 | $ | 60,274 | $ | 112,293 | |||||||||||||||
Earnings per share of Class A common stock – basic | $ | 2.00 | $ | 3.96 | $ | 4.21 | $ | 8.14 | |||||||||||||||
Earnings per share of Class A common stock – diluted | $ | 1.95 | $ | 3.86 | $ | 4.12 | $ | 7.90 | |||||||||||||||
Basic weighted-average shares of Class A common stock outstanding | 14,314 | 14,133 | 14,317 | 13,791 | |||||||||||||||||||
Diluted weighted-average shares of Class A common stock outstanding | 14,675 | 14,512 | 14,639 | 14,205 |
For the Three Months Ended December 31, | ||||||||
2022 | 2021 | |||||||
Net income | $ | 11,428 | $ | 23,486 | ||||
Other comprehensive income: | ||||||||
Foreign currency translation adjustment | 11 | - | ||||||
Comprehensive income | 11,439 | 23,486 | ||||||
Less: Net income attributable to non-controlling interests | (1,365 | ) | - | |||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (1,163 | ) | (3,467 | ) | ||||
Foreign currency translation adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC | (1 | ) | - | |||||
Comprehensive income attributable to One Water Marine Holdings, Inc. | $ | 8,910 | $ | 20,019 |
For the Three Months Ended June 30, | For the Nine Months Ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Net income | $ | 33,290 | $ | 64,483 | $ | 71,755 | $ | 130,323 | |||||||||||||||
Other comprehensive income: | |||||||||||||||||||||||
Foreign currency translation adjustment | (4) | - | 15 | - | |||||||||||||||||||
Comprehensive income | 33,286 | 64,483 | 71,770 | 130,323 | |||||||||||||||||||
Less: Net income attributable to non-controlling interests | (938) | (959) | (3,468) | (1,970) | |||||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (3,782) | (7,547) | (8,013) | (16,060) | |||||||||||||||||||
Foreign currency translation adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC | - | - | (2) | - | |||||||||||||||||||
Comprehensive income attributable to One Water Marine Holdings, Inc. | $ | 28,566 | $ | 55,977 | $ | 60,287 | $ | 112,293 |
Class A Common Stock | Class B Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Non-controlling Interest | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2022 | 14,212 | $ | 142 | 1,430 | $ | 14 | $ | 180,296 | $ | 204,880 | $ | 59,552 | $ | (7) | $ | 444,877 | |||||||||||||||||||||||||||||||||||||
Net income | - | - | - | - | - | 8,900 | 2,528 | - | 11,428 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | - | - | - | - | - | (10) | (309) | - | (319) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 86 | 1 | - | - | (755) | - | - | - | (754) | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | - | - | - | - | 2,572 | - | - | - | 2,572 | ||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment | - | - | - | - | - | - | 1 | 10 | 11 | ||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2022 | 14,298 | $ | 143 | 1,430 | $ | 14 | $ | 182,113 | $ | 213,770 | $ | 61,772 | $ | 3 | $ | 457,815 | |||||||||||||||||||||||||||||||||||||
Net income | - | - | - | - | - | 22,804 | 4,233 | - | 27,037 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | - | - | - | - | - | (2) | (70) | - | (72) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 27 | - | - | - | (386) | - | - | - | (386) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued as part of employee stock purchase plan | 44 | 1 | - | - | 1,062 | - | - | - | 1,063 | ||||||||||||||||||||||||||||||||||||||||||||
Repurchase and retirement of Treasury | (63) | (1) | - | - | (760) | (818) | - | - | (1,579) | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | - | - | - | - | 2,491 | - | - | - | 2,491 | ||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment | - | - | - | - | - | - | 1 | 7 | 8 | ||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2023 | 14,306 | $ | 143 | 1,430 | $ | 14 | $ | 184,520 | $ | 235,754 | $ | 65,936 | $ | 10 | $ | 486,377 | |||||||||||||||||||||||||||||||||||||
Net income | - | - | - | - | - | 28,570 | 4,720 | - | 33,290 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | - | - | - | - | - | 1 | (223) | - | (222) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 12 | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | - | - | - | - | 2,122 | - | - | - | 2,122 | ||||||||||||||||||||||||||||||||||||||||||||
Currency translation adjustment | - | - | - | - | - | - | - | (4) | (4) | ||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2023 | 14,318 | $ | 143 | 1,430 | $ | 14 | $ | 186,642 | $ | 264,325 | $ | 70,433 | $ | 6 | $ | 521,563 |
Class A Common Stock | Class B Common Stock | |||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Non-controlling Interest | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | ||||||||||||||||||||||||||||
Balance at September 30, 2022 | 14,212 | $ | 142 | 1,430 | $ | 14 | $ | 180,296 | $ | 204,880 | $ | 59,552 | $ | (7 | ) | $ | 444,877 | |||||||||||||||||||
Net income | - | - | - | - | - | 8,900 | 2,528 | - | 11,428 | |||||||||||||||||||||||||||
Distributions to members | - | - | - | - | - | (10 | ) | (309 | ) | - | (319 | ) | ||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 86 | 1 | - | - | (755 | ) | - | - | - | (754 | ) | |||||||||||||||||||||||||
Equity-based compensation | - | - | - | - | 2,572 | - | - | - | 2,572 | |||||||||||||||||||||||||||
Currency translation adjustment | - | - | - | - | - | - | 1 | 10 | 11 | |||||||||||||||||||||||||||
Balance at December 31, 2022 | 14,298 | $ | 143 | 1,430 | $ | 14 | $ | 182,113 | $ | 213,770 | $ | 61,772 | $ | 3 | $ | 457,815 |
Class A Common Stock | Class B Common Stock | |||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Non-controlling Interest | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | ||||||||||||||||||||||||||||
Balance at September 30, 2021 | 13,277 | $ | 133 | 1,819 | $ | 18 | $ | 150,825 | $ | 74,952 | $ | 28,905 | $ | - | $ | 254,833 | ||||||||||||||||||||
Net income | - | - | - | - | - | 20,019 | 3,467 | - | 23,486 | |||||||||||||||||||||||||||
Distributions to members | - | - | - | - | - | (442 | ) | (177 | ) | - | (619 | ) | ||||||||||||||||||||||||
Non-controlling interest in subsidiary | - | - | - | - | - | - | 19,311 | - | 19,311 | |||||||||||||||||||||||||||
Exchange of B shares for A shares | 389 | 4 | (389 | ) | (4 | ) | 7,405 | - | (7,405 | ) | - | - | ||||||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis | - | - | - | - | (283 | ) | - | - | - | (283 | ) | |||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 53 | 1 | - | - | (469 | ) | - | - | - | (468 | ) | |||||||||||||||||||||||||
Shares issued in connection with a business combination | 133 | 1 | - | - | 6,833 | - | - | - | 6,834 | |||||||||||||||||||||||||||
Equity-based compensation | - | - | - | - | 2,100 | - | - | - | 2,100 | |||||||||||||||||||||||||||
Balance at December 31, 2021 | 13,852 | $ | 139 | 1,430 | $ | 14 | $ | 166,411 | $ | 94,529 | $ | 44,101 | $ | - | $ | 305,194 |
Class A Common Stock | Class B Common Stock | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Additional Paid-in Capital | Retained Earnings | Non-controlling Interest | Accumulated Other Comprehensive Income (Loss) | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2021 | 13,277 | $ | 133 | 1,819 | $ | 18 | $ | 150,825 | $ | 74,952 | $ | 28,905 | $ | - | $ | 254,833 | |||||||||||||||||||||||||||||||||||||
Net income | — | - | — | - | - | 20,019 | 3,467 | - | 23,486 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | — | - | — | - | - | (442) | (177) | - | (619) | ||||||||||||||||||||||||||||||||||||||||||||
Non-controlling interest in subsidiary | — | - | — | - | - | - | 19,311 | - | 19,311 | ||||||||||||||||||||||||||||||||||||||||||||
Exchange of B shares for A shares | 389 | 4 | (389) | (4) | 7,405 | - | (7,405) | - | - | ||||||||||||||||||||||||||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis | — | - | — | - | (283) | - | - | - | (283) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 53 | 1 | — | - | (469) | - | - | - | (468) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued in connection with a business combination | 133 | 1 | — | - | 6,833 | - | - | - | 6,834 | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | - | — | - | 2,100 | - | - | - | 2,100 | ||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | 13,852 | $ | 139 | 1,430 | $ | 14 | $ | 166,411 | $ | 94,529 | $ | 44,101 | $ | - | $ | 305,194 | |||||||||||||||||||||||||||||||||||||
Net income | — | - | — | - | - | 36,297 | 6,057 | - | 42,354 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | — | - | — | - | - | (266) | (605) | - | (871) | ||||||||||||||||||||||||||||||||||||||||||||
Exchange of B shares for A shares | — | - | — | - | (574) | - | 574 | - | - | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding | 27 | - | — | - | (455) | - | - | - | (455) | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | - | — | - | 2,713 | - | - | - | 2,713 | ||||||||||||||||||||||||||||||||||||||||||||
Balance at March 31, 2022 | 13,879 | $ | 139 | 1,430 | $ | 14 | $ | 168,095 | $ | 130,560 | $ | 50,127 | $ | - | $ | 348,935 | |||||||||||||||||||||||||||||||||||||
Net income | — | - | — | - | - | 55,977 | 8,506 | - | 64,483 | ||||||||||||||||||||||||||||||||||||||||||||
Distributions to members | — | - | — | - | - | (1) | (3) | - | (4) | ||||||||||||||||||||||||||||||||||||||||||||
Shares issued in connection with a business combination | 254 | 2 | — | - | 7,791 | - | - | - | 7,793 | ||||||||||||||||||||||||||||||||||||||||||||
Equity-based compensation | — | - | — | - | 2,461 | - | - | - | 2,461 | ||||||||||||||||||||||||||||||||||||||||||||
Balance at June 30, 2022 | 14,133 | $ | 141 | 1,430 | $ | 14 | $ | 178,347 | $ | 186,536 | $ | 58,630 | $ | - | $ | 423,668 |
For the Three Months Ended December 31 | 2022 | 2021 | ||||||
Cash flows from operating activities | ||||||||
Net income | $ | 11,428 | $ | 23,486 | ||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||
Depreciation and amortization | 6,182 | 1,749 | ||||||
Equity-based awards | 2,572 | 2,100 | ||||||
Loss (gain) on asset disposals | 171 | (37 | ) | |||||
Non-cash interest expense | 2,217 | 200 | ||||||
Deferred income tax provision | 1,185 | 1,659 | ||||||
Change in fair value of contingent consideration | (1,409 | ) | 5,746 | |||||
Loss on equity investment | 260 | - | ||||||
(Increase) decrease in assets: | ||||||||
Accounts receivable | (5,466 | ) | 240 | |||||
Inventories | (147,832 | ) | (71,660 | ) | ||||
Prepaid expenses and other current assets | 13,648 | 2,137 | ||||||
Other assets | (729 | ) | (14 | ) | ||||
Increase (decrease) in liabilities: | ||||||||
Accounts payable | (1,464 | ) | 13,911 | |||||
Other payables and accrued expenses | (12,437 | ) | (6,414 | ) | ||||
Tax receivable agreement liability | - | 313 | ||||||
Customer deposits | (6,376 | ) | 3,759 | |||||
Net cash used in operating activities | (138,050 | ) | (22,825 | ) | ||||
Cash flows from investing activities | ||||||||
Purchases of property and equipment and construction in progress | (6,416 | ) | (3,428 | ) | ||||
Proceeds from disposal of property and equipment | 47 | 6 | ||||||
Cash used in acquisitions, net of cash acquired | (28,611 | ) | (278,798 | ) | ||||
Net cash used in investing activities | (34,980 | ) | (282,220 | ) | ||||
Cash flows from financing activities | ||||||||
Net borrowings from floor plan | 156,032 | 81,403 | ||||||
Proceeds from long-term debt | 20,000 | 240,000 | ||||||
Payments on long-term debt | (379 | ) | (5,507 | ) | ||||
Payments of debt issuance costs | - | (3,979 | ) | |||||
Payments of contingent consideration | (4,300 | ) | - | |||||
Payments of tax withholdings for equity-based awards | (754 | ) | (468 | ) | ||||
Distributions to members | (319 | ) | (5,584 | ) | ||||
Net cash provided by financing activities | 170,280 | 305,865 | ||||||
Effects of exchange rate changes on cash and restricted cash | 11 | - | ||||||
Net change in cash | (2,739 | ) | 820 | |||||
Cash and restricted cash at beginning of period | 60,947 | 73,949 | ||||||
Cash and restricted cash at end of period | $ | 58,208 | $ | 74,769 | ||||
Supplemental cash flow disclosures | ||||||||
Cash paid for interest | $ | 10,146 | $ | 2,206 | ||||
Cash paid for income taxes | 2,897 | 702 | ||||||
Noncash items | ||||||||
Acquisition purchase price funded by seller notes payable | $ | - | $ | 1,126 | ||||
Acquisition purchase price funded by contingent consideration | 2,550 | 9,967 | ||||||
Accrued purchase consideration | - | 5,353 | ||||||
Acquisition purchase price funded by issuance of Class A common stock | - | 6,834 | ||||||
Purchase of property and equipment funded by long-term debt | 792 | 231 | ||||||
Right-of-use assets obtained in exchange for new operating lease liabilities | 6,314 | 31,529 | ||||||
Acquisition purchase price funded by affiliate financing | 10,600 | - | ||||||
Settlement of affiliate financing with proceeds from sale and leaseback | 10,600 | - |
For the Nine Months Ended June 30 | 2023 | 2022 | ||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||||||||
Net income | $ | 71,755 | $ | 130,323 | ||||||||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||||||||
Depreciation and amortization | 19,126 | 10,816 | ||||||||||||
Equity-based awards | 7,185 | 7,274 | ||||||||||||
Loss (gain) on asset disposals | 282 | (59) | ||||||||||||
Non-cash interest expense | 9,432 | 1,370 | ||||||||||||
Deferred income tax provision | 2,826 | 2,030 | ||||||||||||
Change in fair value of contingent consideration | 763 | 11,022 | ||||||||||||
Loss on equity investment | 184 | - | ||||||||||||
(Increase) decrease in assets: | ||||||||||||||
Accounts receivable | (35,825) | (41,235) | ||||||||||||
Inventories | (193,722) | (88,158) | ||||||||||||
Prepaid expenses and other current assets | (12,958) | (17,770) | ||||||||||||
Other assets | (2,866) | (160) | ||||||||||||
Increase (decrease) in liabilities: | ||||||||||||||
Accounts payable | 12,372 | 33,624 | ||||||||||||
Other payables and accrued expenses | (2,414) | 8,096 | ||||||||||||
Tax receivable agreement liability | - | 313 | ||||||||||||
Customer deposits | (10,337) | 4,637 | ||||||||||||
Net cash (used in) provided by operating activities | (134,197) | 62,123 | ||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||||||||
Purchases of property and equipment and construction in progress | (17,001) | (11,649) | ||||||||||||
Proceeds from disposal of property and equipment | 326 | 122 | ||||||||||||
Cash used for additions to intangible assets | (1,467) | - | ||||||||||||
Cash used in acquisitions, net of cash acquired | (28,611) | (326,089) | ||||||||||||
Net cash used in investing activities | (46,753) | (337,616) | ||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||||||||
Net borrowings from floor plan | 175,434 | 103,103 | ||||||||||||
Proceeds from long-term debt | 30,000 | 240,000 | ||||||||||||
Payments on long-term debt | (17,756) | (18,090) | ||||||||||||
Payments of debt issuance costs | - | (4,057) | ||||||||||||
Payments of contingent consideration | (12,259) | (133) | ||||||||||||
Payments of tax withholdings for equity-based awards | (1,140) | (923) | ||||||||||||
Proceeds from issuance of Class A common stock as part of employee stock purchase plan | 1,063 | - | ||||||||||||
Distributions to members | (613) | (6,457) | ||||||||||||
Repurchase and retirement of Class A common stock | (1,579) | - | ||||||||||||
Net cash provided by financing activities | 173,150 | 313,443 | ||||||||||||
Effects of exchange rate changes on cash and restricted cash | 15 | - | ||||||||||||
Net change in cash | (7,785) | 37,950 | ||||||||||||
Cash and restricted cash at beginning of period | 60,947 | 73,949 | ||||||||||||
Cash and restricted cash at end of period | $ | 53,162 | $ | 111,899 | ||||||||||
Supplemental cash flow disclosures: | ||||||||||||||
Cash paid for interest | $ | 33,520 | $ | 9,623 | ||||||||||
Cash paid for income taxes | 21,949 | 6,344 | ||||||||||||
Noncash items: | ||||||||||||||
Acquisition purchase price funded by seller notes payable | $ | - | $ | 1,126 | ||||||||||
Acquisition purchase price funded by contingent consideration | 2,550 | 15,321 | ||||||||||||
Acquisition purchase price funded by issuance of Class A common stock | - | 6,834 | ||||||||||||
Purchase of property and equipment funded by long-term debt | 1,053 | 1,423 | ||||||||||||
Right-of-use assets obtained in exchange for new operating lease liabilities | 14,826 | 46,378 | ||||||||||||
Acquisition purchase price funded by affiliate financing | 10,600 | - | ||||||||||||
Settlement of affiliate financing with proceeds from sale and leaseback | 10,600 | - |
2. Summary of Significant Accounting Policies |
($ in thousands) | Three Months Ended June 30, 2023 | Nine Months Ended June 30, 2023 | |||||||||
Beginning contract liability | $ | 59,020 | $ | 65,460 | |||||||
Revenue recognized from contract liabilities included in the beginning balance | (36,011) | (62,655) | |||||||||
Increases due to business combinations and cash received, net of amounts recognized in revenue during the period | 33,114 | 53,318 | |||||||||
Ending contract liability | $ | 56,123 | $ | 56,123 |
($ in thousands) | Three Months Ended December 31, 2022 | |||
Beginning contract liability | $ | 65,460 | ||
Revenue recognized from contract liabilities included in the beginning balance | (42,496 | ) | ||
Increases due to business combinations and cash received, net of amounts recognized in revenue during the period | 37,120 | |||
Ending contract liability | $ | 60,084 |
Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
Goods and services transferred at a point in time | 92.8 | % | 93.2 | % | ||||
Goods and services transferred over time | 7.2 | % | 6.8 | % | ||||
Total Revenue | 100.0 | % | 100.0 | % |
Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | ||||||||||
Goods and services transferred at a point in time | 94.3 | % | 95.0 | % | |||||||
Goods and services transferred over time | 5.7 | % | 5.0 | % | |||||||
Total Revenue | 100.0 | % | 100.0 | % |
Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | ||||||||||
Goods and services transferred at a point in time | 94.0 | % | 94.6 | % | |||||||
Goods and services transferred over time | 6.0 | % | 5.4 | % | |||||||
Total Revenue | 100.0 | % | 100.0 | % |
3. New Accounting Pronouncements |
• |
Summary of Assets Acquired and Liabilities Assumed ($ in thousands) | Total Acquisitions | |||
Accounts receivable | $ | 188 | ||
Inventories | 6,232 | |||
Prepaid expenses | 73 | |||
Property and equipment | 11,587 | |||
Operating lease right-of-use assets | 2,952 | |||
Identifiable intangible assets | 8,400 | |||
Goodwill | 18,880 | |||
Accounts payable | (17 | ) | ||
Accrued expenses | (354 | ) | ||
Customer deposits | (1,000 | ) | ||
Notes payable - floor plan | (2,228 | ) | ||
Operating lease liabilities | (2,952 | ) | ||
Aggregate acquisition date fair value | $ | 41,761 | ||
Consideration transferred | $ | 41,761 |
Summary of Assets Acquired and Liabilities Assumed | |||||
($ in thousands) | Total Acquisitions | ||||
Accounts receivable | $ | 188 | |||
Inventories | 6,232 | ||||
Prepaid expenses | 73 | ||||
Property and equipment | 11,587 | ||||
Operating lease right-of-use assets | 2,952 | ||||
Identifiable intangible assets | 8,800 | ||||
Goodwill | 18,480 | ||||
Accounts payable | (17) | ||||
Accrued expenses | (354) | ||||
Customer deposits | (1,000) | ||||
Notes payable - floor plan | (2,228) | ||||
Operating lease liabilities | (2,952) | ||||
Aggregate acquisition date fair value | $ | 41,761 | |||
Consideration transferred | $ | 41,761 |
Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | ||||||||||
($ in thousands) | (Unaudited) | ||||||||||
Pro forma revenue | $ | 594,339 | $ | 604,513 | |||||||
Pro forma net income | $ | 33,290 | $ | 69,181 |
Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
($ in thousands) | ||||||||
(Unaudited) | ||||||||
Pro forma revenue | $ | 369,363 | $ | 428,136 | ||||
Pro forma net income | $ | 11,542 | $ | 25,916 |
Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | ||||||||||
($ in thousands) | (Unaudited) | ||||||||||
Pro forma revenue | $ | 1,488,033 | $ | 1,522,588 | |||||||
Pro forma net income | $ | 71,869 | $ | 143,448 |
5. Accounts Receivable |
($ in thousands) | December 31, 2022 | September 30, 2022 | ||||||
Trade accounts receivable | $ | 43,143 | $ | 37,359 | ||||
Contracts in transit | 15,044 | 14,543 | ||||||
Manufacturer receivable | 6,365 | 7,224 | ||||||
Total accounts receivable | 64,552 | 59,126 | ||||||
Less – allowance for credit losses | (939 | ) | (1,166 | ) | ||||
Total accounts receivable, net | $ | 63,613 | $ | 57,960 |
($ in thousands) | June 30, 2023 | September 30, 2022 | |||||||||
Contracts in transit | $ | 51,337 | $ | 14,543 | |||||||
Trade accounts receivable | 33,129 | 37,359 | |||||||||
Manufacturer receivable | 10,373 | 7,224 | |||||||||
Total accounts receivable | 94,839 | 59,126 | |||||||||
Less – allowance for credit losses | (867) | (1,166) | |||||||||
Total accounts receivable, net | $ | 93,972 | $ | 57,960 |
($ in thousands) | June 30, 2023 | September 30, 2022 | |||||||||
New vessels | $ | 426,932 | $ | 243,090 | |||||||
Pre-owned vessels | 68,508 | 51,607 | |||||||||
Work in process, parts and accessories | 77,492 | 78,262 | |||||||||
$ | 572,932 | $ | 372,959 |
($ in thousands) | December 31, 2022 | September 30, 2022 | ||||||
New vessels | $ | 388,004 | $ | 243,090 | ||||
Pre-owned vessels | 61,658 | 51,607 | ||||||
Work in process, parts and accessories | 77,361 | 78,262 | ||||||
$ | 527,023 | $ | 372,959 |
7. Goodwill and Other Identifiable Intangible Assets |
($ in thousands) | Goodwill Unamortized | Trade Names Unamortized | Developed technologies Amortized | Customer Relationships Amortized | Domain Names Amortized | Internally Developed Software Amortized | Total Intangible Assets, net | |||||||||||||||||||||
Net balance as of September 30, 2022 | 378,588 | 186,779 | 14,274 | 101,230 | 1,970 | 2,218 | 306,471 | |||||||||||||||||||||
Acquisitions during the three months ended December 31, 2022 | 18,880 | 8,400 | - | - | - | - | 8,400 | |||||||||||||||||||||
Accumulated amortization for the three months ended December 31, 2022 | - | - | (386 | ) | (2,687 | ) | (104 | ) | (115 | ) | (3,292 | ) | ||||||||||||||||
Net balance as of December 31, 2022 | $ | 397,468 | $ | 195,179 | $ | 13,888 | $ | 98,543 | $ | 1,866 | $ | 2,103 | $ | 311,579 |
Goodwill | Trade Names | Developed Technologies | Customer Relationships | Domain Names | Internally Developed Software | Total Intangible Assets, net | ||||||||||||||||||||||||||||||||||||||
($ in thousands) | Unamortized | Unamortized | Amortized | Amortized | Amortized | Amortized | ||||||||||||||||||||||||||||||||||||||
Net balance as of September 30, 2022 | 378,588 | 186,779 | 14,274 | 101,230 | 1,970 | 2,218 | 306,471 | |||||||||||||||||||||||||||||||||||||
Acquisitions during the nine months ended June 30, 2023 | 18,480 | 8,800 | - | - | 815 | 652 | 10,267 | |||||||||||||||||||||||||||||||||||||
Other adjustments during the nine months ended June 30, 2023 | 401 | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||
Accumulated amortization for the nine months ended June 30, 2023 | - | - | (1,159) | (8,062) | (359) | (382) | (9,962) | |||||||||||||||||||||||||||||||||||||
Net balance as of June 30, 2023 | $ | 397,469 | $ | 195,579 | $ | 13,115 | $ | 93,168 | $ | 2,426 | $ | 2,488 | $ | 306,776 |
2023 (excluding the nine months ended June 30, 2023) | $ | 3,376 | |||
2024 | 13,506 | ||||
2025 | 13,506 | ||||
2026 | 13,506 | ||||
2027 | 13,271 | ||||
Thereafter | 54,032 | ||||
$ | 111,197 |
2023 (excluding the three months ended December 31, 2022) | $ | 9,877 | ||
2024 | 13,170 | |||
2025 | 13,170 | |||
2026 | 13,170 | |||
2027 | 12,982 | |||
Thereafter | 54,031 | |||
$ | 116,400 |
8. Notes Payable — Floor Plan |
9. Long-term Debt and Line of Credit |
($ in thousands) | June 30, 2023 | September 30, 2022 | |||||||||
Term note payable to Truist Bank, secured and bearing interest at 7.14% at June 30, 2023 and 5.31% at September 30, 2022. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on August 9, 2027 | $ | 428,313 | $ | 445,000 | |||||||
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 7.14% at June 30, 2023. The note requires full repayment on August 9, 2027 | 30,000 | - | |||||||||
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 8.4% per annum. The notes require monthly installment payments of principal and interest ranging from $100 to $5,600 through July 2028 | 4,158 | 4,173 | |||||||||
Note payable to Tom George Yacht Group, unsecured and bearing interest at 5.5% per annum. The note requires monthly interest payments, with a balloon payment of principal due on December 1, 2023 | 2,056 | 2,056 | |||||||||
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note requires quarterly interest payments, with a balloon payment of principal due on December 1, 2024 | 1,126 | 1,126 | |||||||||
Total debt outstanding | 465,653 | 452,355 | |||||||||
Less current portion (net of debt issuance costs) | (23,896) | (21,642) | |||||||||
Less unamortized portion of debt issuance costs | (7,868) | (9,551) | |||||||||
Long-term debt, net of current portion and unamortized debt issuance costs | $ | 433,889 | $ | 421,162 |
($ in thousands) | December 31, 2022 | September 30, 2022 | ||||||
Term note payable to Truist Bank, secured and bearing interest at 6.72% at December 31, 2022 and 5.31% at September 30, 2022. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on August 9, 2027 | $ | 445,000 | $ | 445,000 | ||||
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 6.72% at December 31, 2022. The note requires full repayment on August 9, 2027 | 20,000 | - | ||||||
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 8.4% per annum. The notes require monthly installment payments of principal and interest ranging from $100 to $5,600 through July 2028 | 4,586 | 4,173 | ||||||
Note payable to Tom George Yacht Group, unsecured and bearing interest at 5.5% per annum. The note requires monthly interest payments, with a balloon payment of principal due on December 1, 2023 | 2,056 | 2,056 | ||||||
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note requires quarterly interest payments, with a balloon payment of principal due on December 1, 2024 | 1,126 | 1,126 | ||||||
Total debt outstanding | 472,768 | 452,355 | ||||||
Less current portion (net of debt issuance costs) | (29,247 | ) | (21,642 | ) | ||||
Less unamortized portion of debt issuance costs | (8,851 | ) | (9,551 | ) | ||||
Long-term debt, net of current portion and unamortized debt issuance costs | $ | 434,670 | $ | 421,162 |
10. Stockholders’ and Members’ Equity |
Restricted Stock Unit Awards | ||||||||
Number of Shares | Weighted Average Grant Date Fair Value ($) | |||||||
Unvested at September 30, 2022 | 559,793 | $ | 28.01 | |||||
Awarded | 214,149 | 30.11 | ||||||
Vested | (111,075 | ) | 24.62 | |||||
Forfeited | (1,000 | ) | 40.21 | |||||
Unvested at December 31, 2022 | 661,867 | $ | 29.24 |
Restricted Stock Unit Awards | |||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | ||||||||||
Unvested at September 30, 2022 | 559,793 | $ | 28.01 | ||||||||
Awarded | 216,771 | 30.08 | |||||||||
Vested | (163,393) | 23.44 | |||||||||
Forfeited | (2,001) | 38.66 | |||||||||
Unvested at June 30, 2023 | 611,170 | $ | 29.93 |
Earnings per share: | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | ||||||||||||
Numerator: | ||||||||||||||
Net income attributable to OneWater Inc. | $ | 28,570 | $ | 55,977 | ||||||||||
Denominator: | ||||||||||||||
Weighted-average number of unrestricted outstanding common shares used to calculate basic net income per share | 14,314 | 14,133 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||
Restricted stock units | 356 | 379 | ||||||||||||
Employee stock purchase plan | 5 | - | ||||||||||||
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted earnings per share | 14,675 | 14,512 | ||||||||||||
Earnings per share of Class A common stock – basic | $ | 2.00 | $ | 3.96 | ||||||||||
Earnings per share of Class A common stock – diluted | $ | 1.95 | $ | 3.86 |
Earnings per share: | Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | ||||||
Numerator: | ||||||||
Net income attributable to OneWater Inc. | $ | 8,900 | $ | 20,019 | ||||
Denominator: | ||||||||
Weighted-average number of unrestricted outstanding common shares used to calculate basic net income per share | 14,297 | 13,380 | ||||||
Effect of dilutive securities: | ||||||||
Restricted stock units | 284 | 381 | ||||||
Employee Stock Purchase Plan | 6 | - | ||||||
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted earnings per share | 14,587 | 13,761 | ||||||
Earnings per share of Class A common stock – basic | $ | 0.62 | $ | 1.50 | ||||
Earnings per share of Class A common stock – diluted | $ | 0.61 | $ | 1.45 |
Earnings per share: | Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | ||||||||||||
Numerator: | ||||||||||||||
Net income attributable to OneWater Inc. | $ | 60,274 | $ | 112,293 | ||||||||||
Denominator: | ||||||||||||||
Weighted-average number of unrestricted outstanding common shares used to calculate basic net income per share | 14,317 | 13,791 | ||||||||||||
Effect of dilutive securities: | ||||||||||||||
Restricted stock units | 318 | 414 | ||||||||||||
Employee stock purchase plan | 4 | - | ||||||||||||
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted earnings per share | 14,639 | 14,205 | ||||||||||||
Earnings per share of Class A common stock – basic | $ | 4.21 | $ | 8.14 | ||||||||||
Earnings per share of Class A common stock – diluted | $ | 4.12 | $ | 7.90 |
Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | ||||||||||
Class B common stock | 1,430 | 1,430 | |||||||||
Restricted Stock Units | 216 | 256 | |||||||||
1,646 | 1,686 |
Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
Class B common stock | 1,430 | 1,815 | ||||||
Restricted Stock Units | 377 | 233 | ||||||
1,807 | 2,048 |
Nine Months Ended June 30, 2023 | Nine Months Ended June 30, 2022 | ||||||||||
Class B common stock | 1,430 | 1,560 | |||||||||
Restricted Stock Units | 281 | 233 | |||||||||
1,711 | 1,793 |
2023 | ||||||||
Dividend yield | 0.0 | % | ||||||
Risk-free interest rate | 4.8 | % | ||||||
Volatility | 45.6 | % | ||||||
Expected life | Six months |
11. Fair Value Measurements |
June 30, 2023 | ||||||||||||||||||||||||||
($ in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment in Equity Securities | $ | 588 | $ | - | $ | - | $ | 588 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Contingent Consideration | - | - | 25,051 | 25,051 |
December 31, 2022 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
($ in thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Investment in Equity Securities | $ | 512 | $ | - | $ | - | $ | 512 | ||||||||
Liabilities: | ||||||||||||||||
Contingent Consideration | - | - | 32,817 | 32,817 |
September 30, 2022 | ||||||||||||||||||||||||||
($ in thousands) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||
Investment in Equity Securities | $ | 772 | $ | - | $ | - | $ | 772 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||
Contingent Consideration | - | - | 37,402 | 37,402 |
September 30, 2022 | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
($ in thousands) | ||||||||||||||||
Assets: | ||||||||||||||||
Investment in Equity Securities | $ | 772 | $ | - | $ | - | $ | 772 | ||||||||
Liabilities: | ||||||||||||||||
Contingent Consideration | - | - | 37,402 | 37,402 |
($ in thousands) | Three Months Ended June 30, 2023 | ||||
Net gain (loss) recognized during the period on equity securities | $ | 96 | |||
Less net gain (loss) recognized during the period on equity securities sold during the period | - | ||||
Unrealized gain (loss) recognized during the reporting period on equity securities still held at the reporting date | $ | 96 |
($ in thousands) | Three Months Ended December 31, 2022 | |||
Net losses recognized during the period on equity securities | $ | 260 | ||
Less net losses recognized during the period on equity securities sold during the period | - | |||
Unrealized losses recognized during the reporting period on equity securities still held at the reporting date | $ | 260 |
($ in thousands) | Nine Months Ended June 30, 2023 | ||||
Net gain (loss) recognized during the period on equity securities | $ | (184) | |||
Less net gain (loss) recognized during the period on equity securities sold during the period | - | ||||
Unrealized gain (loss) recognized during the reporting period on equity securities still held at the reporting date | $ | (184) |
($ in thousands) | Three Months Ended June 30, 2023 | ||||
Balance as of March 31, 2023 | $ | 26,275 | |||
Additions from acquisitions | — | ||||
Settlement of contingent consideration | (1,660) | ||||
Change in fair value, including accretion | 436 | ||||
Balance as of June 30, 2023 | $ | 25,051 |
($ in thousands) | Contingent Consideration | |||
Balance as of September 30, 2022 | $ | 37,402 | ||
Additions from acquisitions | 2,550 | |||
Settlement of contingent consideration | (5,726 | ) | ||
Change in fair value, including accretion | (1,409 | ) | ||
Balance as of December 31, 2022 | $ | 32,817 |
($ in thousands) | Nine Months Ended June 30, 2023 | ||||
Balance as of September 30, 2022 | $ | 37,402 | |||
Additions from acquisitions | 2,550 | ||||
Settlement of contingent consideration | (15,665) | ||||
Change in fair value, including accretion | 764 | ||||
Balance as of June 30, 2023 | $ | 25,051 |
14. Leases |
16. Segment Information |
As of and for the Three Months Ended June 30, 2023 | ||||||||||||||||||||||||||
($ in thousands) | Dealerships | Distribution | Eliminations | Total | ||||||||||||||||||||||
Revenue | $ | 543,312 | $ | 51,180 | $ | (153) | $ | 594,339 | ||||||||||||||||||
Income (loss) from operations | 59,699 | 388 | (7) | 60,080 | ||||||||||||||||||||||
Depreciation and amortization | 2,768 | 3,816 | - | 6,584 | ||||||||||||||||||||||
Transaction costs | 9 | 88 | - | 97 | ||||||||||||||||||||||
Change in fair value of contingent consideration | 390 | 46 | - | 436 | ||||||||||||||||||||||
Total assets | 1,368,783 | 402,559 | (25) | 1,771,317 |
As of and for the Three Months Ended December 31, 2022 | ||||||||||||
($ in thousands) | Dealerships | Distribution | Total | |||||||||
Revenue | $ | 326,773 | $ | 39,886 | $ | 366,659 | ||||||
Income (loss) from operations | 29,853 | (3,317 | ) | 26,536 | ||||||||
Depreciation and amortization | 1,886 | 3,807 | 5,693 | |||||||||
Transaction costs | 1,182 | 148 | 1,330 | |||||||||
Change in fair value of contingent consideration | (1,543 | ) | 134 | (1,409 | ) | |||||||
Total assets | 1,283,821 | 388,272 | 1,672,093 |
As of and for the Nine Months Ended June 30, 2023 | ||||||||||||||||||||||||||
($ in thousands) | Dealerships | Distribution | Eliminations | Total | ||||||||||||||||||||||
Revenue | $ | 1,348,433 | $ | 137,049 | $ | (153) | $ | 1,485,329 | ||||||||||||||||||
Income (loss) from operations | 137,938 | (2,425) | (7) | 135,506 | ||||||||||||||||||||||
Depreciation and amortization | 7,706 | 11,420 | - | 19,126 | ||||||||||||||||||||||
Transaction costs | 1,432 | 236 | - | 1,668 | ||||||||||||||||||||||
Change in fair value of contingent consideration | 474 | 289 | - | 763 | ||||||||||||||||||||||
Total assets | 1,368,783 | 402,559 | (25) | 1,771,317 |
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
For the three months ended December 31, 2022 | For the three months ended December 31, 2021 | |||||||||||||||||||||||
Amount | % of Revenue | Amount | % of Revenue | $ Change | % Change | |||||||||||||||||||
($ in thousands) | ||||||||||||||||||||||||
Revenues | ||||||||||||||||||||||||
New boat | $ | 232,405 | 63.4 | % | $ | 236,198 | 70.2 | % | $ | (3,793 | ) | -1.6 | % | |||||||||||
Pre-owned boat | 55,778 | 15.2 | % | 53,449 | 15.9 | % | 2,329 | 4.4 | % | |||||||||||||||
Finance & insurance income | 8,934 | 2.4 | % | 9,307 | 2.8 | % | (373 | ) | -4.0 | % | ||||||||||||||
Service, parts and other | 69,542 | 19.0 | % | 37,318 | 11.1 | % | 32,224 | 86.3 | % | |||||||||||||||
Total revenues | 366,659 | 100.0 | % | 336,272 | 100.0 | % | 30,387 | 9.0 | % | |||||||||||||||
Gross Profit | ||||||||||||||||||||||||
New boat | 57,147 | 15.6 | % | 60,302 | 17.9 | % | (3,155 | ) | -5.2 | % | ||||||||||||||
Pre-owned boat | 15,474 | 4.2 | % | 14,079 | 4.2 | % | 1,395 | 9.9 | % | |||||||||||||||
Finance & insurance | 8,934 | 2.4 | % | 9,307 | 2.8 | % | (373 | ) | -4.0 | % | ||||||||||||||
Service, parts & other | 28,433 | 7.8 | % | 17,277 | 5.1 | % | 11,156 | 64.6 | % | |||||||||||||||
Total gross profit | 109,988 | 30.0 | % | 100,965 | 30.0 | % | 9,023 | 8.9 | % | |||||||||||||||
Selling, general and administrative expenses | 77,838 | 21.2 | % | 59,096 | 17.6 | % | 18,742 | 31.7 | % | |||||||||||||||
Depreciation and amortization | 5,693 | 1.6 | % | 1,749 | 0.5 | % | 3,944 | 225.5 | % | |||||||||||||||
Transaction costs | 1,330 | 0.4 | % | 3,045 | 0.9 | % | (1,715 | ) | -56.3 | % | ||||||||||||||
Change in fair value of contingent consideration | (1,409 | ) | -0.4 | % | 5,746 | 1.7 | % | (7,155 | ) | -124.5 | % | |||||||||||||
Income from operations | 26,536 | 7.2 | % | 31,329 | 9.3 | % | (4,793 | ) | -15.3 | % | ||||||||||||||
Interest expense - floor plan | 4,779 | 1.3 | % | 877 | 0.3 | % | 3,902 | 444.9 | % | |||||||||||||||
Interest expense - other | 7,584 | 2.1 | % | 1,529 | 0.5 | % | 6,055 | 396.0 | % | |||||||||||||||
Other (income) expense, net | (639 | ) | -0.2 | % | 548 | 0.2 | % | (1,187 | ) | -216.6 | % | |||||||||||||
Income before income tax expense | 14,812 | 4.0 | % | 28,375 | 8.4 | % | (13,563 | ) | -47.8 | % | ||||||||||||||
Income tax expense | 3,384 | 0.9 | % | 4,889 | 1.5 | % | (1,505 | ) | -30.8 | % | ||||||||||||||
Net income | 11,428 | 3.1 | % | 23,486 | 7.0 | % | (12,058 | ) | -51.3 | % | ||||||||||||||
Less: Net income attributable to non-controlling interests | (1,365 | ) | - | |||||||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (1,163 | ) | (3,467 | ) | ||||||||||||||||||||
Net income attributable to One Water Marine Inc. | $ | 8,900 | $ | 20,019 |
For the Three Months Ended June 30, 2023 | For the Three Months Ended June 30, 2022 | $ Change | % Change | |||||||||||||||||||||||||||||||||||
($ in thousands) | Amount | % of Revenue | Amount | % of Revenue | ||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
New boat | $ | 371,645 | 62.5 | % | $ | 376,886 | 66.2 | % | $ | (5,241) | -1.4 | % | ||||||||||||||||||||||||||
Pre-owned boat | 111,469 | 18.8 | % | 98,181 | 17.3 | % | 13,288 | 13.5 | % | |||||||||||||||||||||||||||||
Finance & insurance income | 19,028 | 3.2 | % | 18,979 | 3.3 | % | 49 | 0.3 | % | |||||||||||||||||||||||||||||
Service, parts & other | 92,197 | 15.5 | % | 74,854 | 13.2 | % | 17,343 | 23.2 | % | |||||||||||||||||||||||||||||
Total revenues | 594,339 | 100.0 | % | 568,900 | 100.0 | % | 25,439 | 4.5 | % | |||||||||||||||||||||||||||||
Gross Profit | ||||||||||||||||||||||||||||||||||||||
New boat | 76,162 | 12.8 | % | 102,342 | 18.0 | % | (26,180) | -25.6 | % | |||||||||||||||||||||||||||||
Pre-owned boat | 25,055 | 4.2 | % | 29,432 | 5.2 | % | (4,377) | -14.9 | % | |||||||||||||||||||||||||||||
Finance & insurance | 19,028 | 3.2 | % | 18,979 | 3.3 | % | 49 | 0.3 | % | |||||||||||||||||||||||||||||
Service, parts & other | 39,189 | 6.6 | % | 33,186 | 5.8 | % | 6,003 | 18.1 | % | |||||||||||||||||||||||||||||
Total gross profit | 159,434 | 26.8 | % | 183,939 | 32.3 | % | (24,505) | -13.3 | % | |||||||||||||||||||||||||||||
Selling, general and administrative expenses | 92,841 | 15.6 | % | 87,867 | 15.4 | % | 4,974 | 5.7 | % | |||||||||||||||||||||||||||||
Depreciation and amortization | 5,980 | 1.0 | % | 4,073 | 0.7 | % | 1,907 | 46.8 | % | |||||||||||||||||||||||||||||
Transaction costs | 97 | — | % | 1,337 | 0.2 | % | (1,240) | -92.7 | % | |||||||||||||||||||||||||||||
Change in fair value of contingent consideration | 436 | 0.1 | % | 3,118 | 0.5 | % | (2,682) | -86.0 | % | |||||||||||||||||||||||||||||
Income from operations | 60,080 | 10.1 | % | 87,544 | 15.4 | % | (27,464) | -31.4 | % | |||||||||||||||||||||||||||||
Interest expense – floor plan | 7,436 | 1.3 | % | 1,131 | 0.2 | % | 6,305 | 557.5 | % | |||||||||||||||||||||||||||||
Interest expense – other | 9,077 | 1.5 | % | 3,311 | 0.6 | % | 5,766 | 174.1 | % | |||||||||||||||||||||||||||||
Other expense (income), net | 361 | 0.1 | % | (166) | — | % | 527 | -317.5 | % | |||||||||||||||||||||||||||||
Income before income tax expense | 43,206 | 7.3 | % | 83,268 | 14.6 | % | (40,062) | -48.1 | % | |||||||||||||||||||||||||||||
Income tax expense | 9,916 | 1.7 | % | 18,785 | 3.3 | % | (8,869) | -47.2 | % | |||||||||||||||||||||||||||||
Net income | 33,290 | 5.6 | % | 64,483 | 11.3 | % | (31,193) | -48.4 | % | |||||||||||||||||||||||||||||
Less: Net income attributable to non-controlling interests | (938) | (959) | ||||||||||||||||||||||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (3,782) | (7,547) | ||||||||||||||||||||||||||||||||||||
Net income attributable to OneWater Marine Inc. | $ | 28,570 | $ | 55,977 |
For the Nine Months Ended June 30, 2023 | For the Nine Months Ended June 30, 2022 | $ Change | % Change | |||||||||||||||||||||||||||||||||||
($ in thousands) | Amount | % of Revenue | Amount | % of Revenue | ||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||
New boat | $ | 959,334 | 64.6 | % | $ | 903,104 | 67.0 | % | $ | 56,230 | 6.2 | % | ||||||||||||||||||||||||||
Pre-owned boat | 242,641 | 16.3 | % | 227,484 | 16.9 | % | 15,157 | 6.7 | % | |||||||||||||||||||||||||||||
Finance & insurance income | 43,286 | 2.9 | % | 43,234 | 3.2 | % | 52 | 0.1 | % | |||||||||||||||||||||||||||||
Service, parts & other | 240,068 | 16.2 | % | 173,477 | 12.9 | % | 66,591 | 38.4 | % | |||||||||||||||||||||||||||||
Total revenues | 1,485,329 | 100.0 | % | 1,347,299 | 100.0 | % | 138,030 | 10.2 | % | |||||||||||||||||||||||||||||
Gross Profit | ||||||||||||||||||||||||||||||||||||||
New boat | 213,567 | 14.4 | % | 244,058 | 18.1 | % | (30,491) | -12.5 | % | |||||||||||||||||||||||||||||
Pre-owned boat | 57,743 | 3.9 | % | 63,406 | 4.7 | % | (5,663) | -8.9 | % | |||||||||||||||||||||||||||||
Finance & insurance | 43,286 | 2.9 | % | 43,234 | 3.2 | % | 52 | 0.1 | % | |||||||||||||||||||||||||||||
Service, parts & other | 101,523 | 6.8 | % | 76,748 | 5.7 | % | 24,775 | 32.3 | % | |||||||||||||||||||||||||||||
Total gross profit | 416,119 | 28.0 | % | 427,446 | 31.7 | % | (11,327) | -2.6 | % | |||||||||||||||||||||||||||||
Selling, general and administrative expenses | 260,872 | 17.6 | % | 222,455 | 16.5 | % | 38,417 | 17.3 | % | |||||||||||||||||||||||||||||
Depreciation and amortization | 17,310 | 1.2 | % | 10,549 | 0.8 | % | 6,761 | 64.1 | % | |||||||||||||||||||||||||||||
Transaction costs | 1,668 | 0.1 | % | 5,158 | 0.4 | % | (3,490) | -67.7 | % | |||||||||||||||||||||||||||||
Change in fair value of contingent consideration | 763 | 0.1 | % | 11,022 | 0.8 | % | (10,259) | -93.1 | % | |||||||||||||||||||||||||||||
Income from operations | 135,506 | 9.1 | % | 178,262 | 13.2 | % | (42,756) | -24.0 | % | |||||||||||||||||||||||||||||
Interest expense – floor plan | 17,687 | 1.2 | % | 3,056 | 0.2 | % | 14,631 | 478.8 | % | |||||||||||||||||||||||||||||
Interest expense – other | 25,265 | 1.7 | % | 7,937 | 0.6 | % | 17,328 | 218.3 | % | |||||||||||||||||||||||||||||
Other (income) expense, net | (465) | — | % | 491 | — | % | (956) | -194.7 | % | |||||||||||||||||||||||||||||
Income before income tax expense | 93,019 | 6.3 | % | 166,778 | 12.4 | % | (73,759) | -44.2 | % | |||||||||||||||||||||||||||||
Income tax expense | 21,264 | 1.4 | % | 36,455 | 2.7 | % | (15,191) | -41.7 | % | |||||||||||||||||||||||||||||
Net income | 71,755 | 4.8 | % | 130,323 | 9.7 | % | (58,568) | -44.9 | % | |||||||||||||||||||||||||||||
Less: Net income attributable to non-controlling interests | (3,468) | (1,970) | ||||||||||||||||||||||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC | (8,013) | (16,060) | ||||||||||||||||||||||||||||||||||||
Net income attributable to OneWater Marine Inc. | $ | 60,274 | $ | 112,293 |
Three months ended December 31, | ||||||||
Description | 2022 | 2021 | ||||||
($ in thousands) | ||||||||
Net income | $ | 11,428 | $ | 23,486 | ||||
Interest expense – other | 7,584 | 1,529 | ||||||
Income tax expense | 3,384 | 4,889 | ||||||
Depreciation and amortization | 6,182 | 1,749 | ||||||
Change in fair value of contingent consideration | (1,409 | ) | 5,746 | |||||
Transaction costs | 1,330 | 3,045 | ||||||
Other (income) expense, net | (639 | ) | 548 | |||||
Adjusted EBITDA | $ | 27,860 | $ | 40,992 |
Three Months Ended June 30, | ||||||||||||||
($ in thousands) | 2023 | 2022 | ||||||||||||
Net income | $ | 33,290 | $ | 64,483 | ||||||||||
Interest expense – other | 9,077 | 3,311 | ||||||||||||
Income tax expense | 9,916 | 18,785 | ||||||||||||
Depreciation and amortization | 6,584 | 4,274 | ||||||||||||
Change in fair value of contingent consideration | 436 | 3,118 | ||||||||||||
Transaction costs | 97 | 1,337 | ||||||||||||
Other expense (income), net | 361 | (166) | ||||||||||||
Adjusted EBITDA | $ | 59,761 | $ | 95,142 |
Nine Months Ended June 30, | ||||||||||||||
($ in thousands) | 2023 | 2022 | ||||||||||||
Net income | $ | 71,755 | $ | 130,323 | ||||||||||
Interest expense – other | 25,265 | 7,937 | ||||||||||||
Income tax expense | 21,264 | 36,455 | ||||||||||||
Depreciation and amortization | 19,126 | 10,814 | ||||||||||||
Change in fair value of contingent consideration | 763 | 11,022 | ||||||||||||
Transaction costs | 1,668 | 5,158 | ||||||||||||
Other expense (income), net | (465) | 491 | ||||||||||||
Adjusted EBITDA | $ | 139,376 | $ | 202,200 |
Three Months ended December 31, | ||||||||||||
Description | 2022 | 2021 | Change | |||||||||
($ in thousands) | ||||||||||||
Net cash used in operating activities | $ | (138,050 | ) | $ | (22,825 | ) | $ | (115,225 | ) | |||
Net cash used in investing activities | (34,980 | ) | (282,220 | ) | 247,240 | |||||||
Net cash provided by financing activities | 170,280 | 305,865 | (135,585 | ) | ||||||||
Effect of exchange rate changes on cash and restricted cash | 11 | - | 11 | |||||||||
Net change in cash | $ | (2,739 | ) | $ | 820 | $ | (3,559 | ) |
Nine Months Ended June 30, | ||||||||||||||||||||
($ in thousands) | 2023 | 2022 | Change | |||||||||||||||||
Net cash (used in) provided by operating activities | $ | (134,197) | $ | 62,123 | $ | (196,320) | ||||||||||||||
Net cash used in investing activities | (46,753) | (337,616) | 290,863 | |||||||||||||||||
Net cash provided by financing activities | 173,150 | 313,443 | (140,293) | |||||||||||||||||
Effect of exchange rate changes on cash and restricted cash | 15 | — | 15 | |||||||||||||||||
Net change in cash | $ | (7,785) | $ | 37,950 | $ | (45,735) |
Item 4. Controls and Procedures |
Item 1. Legal Proceedings |
Item 1A. Risk Factors |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
Item 3. Defaults Upon Senior Securities |
Item 4. Mine Safety Disclosures |
Exhibit No. | Description | ||||
Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |||||
Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a). | |||||
Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. |
Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350. | |||||
101.INS(a) | Inline XBRL Instance Document. | ||||
101.SCH(a) | Inline XBRL Schema Document. | ||||
101.CAL(a) | Inline XBRL Calculation Linkbase Document. | ||||
101.DEF(a) | Inline XBRL Definition Linkbase Document. | ||||
101.LAB(a) | Inline XBRL Labels Linkbase Document. | ||||
101.PRE(a) | Inline XBRL Presentation Linkbase Document. | ||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* | Filed herewith. | ||||
** | Furnished herewith. |
ONEWATER MARINE INC. | ||||||||
(Registrant) | ||||||||
By: | /s/ Philip Austin Singleton, Jr. | |||||||
Philip Austin Singleton, Jr. | ||||||||
Chief Executive Officer | ||||||||
By: | /s/ Jack Ezzell | |||||||
Jack Ezzell | ||||||||
Chief Financial Officer | ||||||||