Exhibit 20
Marine Products Corporation Reports 2003 First Quarter Results
* Net Sales Increased By 30.7 Percent Over Prior Year
* Earnings Per Share Increased By 64.3 Percent Over Prior Year
ATLANTA, April 23 /PRNewswire-FirstCall/ -- Marine Products Corporation
(Amex: MPX) announced its unaudited results for the quarter ended March 31,
2003. Marine Products is a leading manufacturer of fiberglass boats under two
brand names: sterndrive pleasure boats by Chaparral, including SS Sportboats,
Sunesta Deckboats, and Signature Cruisers, and offshore sport fishing boats by
Robalo.
For the quarter ended March 31, 2003, Marine Products generated net sales
of $50,107,000, a 30.7 percent increase compared to $38,323,000 last year. The
increase in net sales was due to a 24 percent increase in the number of boats
sold coupled with a six percent increase in the average selling price per boat.
Gross profit for the quarter was $12,092,000, a 48.6 percent increase over the
same period in 2002. Gross profit as a percentage of sales was 24.1 percent, an
increase of 2.9 percentage points compared to the first quarter of 2002. The
improvement in gross profit as a percentage of net sales was due to higher
overall production volume that provided better production efficiency coupled
with increased sales of cruisers which generate higher gross margins.
Operating income for the quarter was $6,440,000, a 67.1 percent increase
compared to the first quarter last year. This increase over the prior year was
due to higher gross profit, partially offset by higher selling, general and
administrative expenses during the period. The higher selling, general and
administrative expenses include costs that vary with sales and profitability,
such as warranty expense, incentive compensation, and sales commissions.
Net income for the quarter ended March 31, 2003 was $4,194,000, a 68.6
percent increase compared to $2,487,000 in the prior year. Net income increased
due to higher operating income and the decrease in the Company's effective tax
rate, from 38 percent in the prior year to 36 percent in 2003. Diluted earnings
per share for the quarter were $0.23, a 64.3 percent increase compared to $0.14
diluted earnings per share in the prior year. During the quarter, the Company
repurchased 101,990 shares of its common stock for cash on the open market under
its stock buyback program.
Richard A. Hubbell, Marine Products' Chief Executive Officer stated, "The
first quarter of 2003 continued the strong performance of 2002. Dealer orders
continue to be strong, following an outstanding boat show season."
Hubbell continued, "Our average unit sales price rose by six percent
during the quarter, primarily due to success with sales of our larger, value-
added Signature Cruisers complemented by strong sales in larger SSi Sportboats,
our premium-branded sportboat line. Sales of Robalo offshore sport fishing boats
were approximately five percent of first quarter 2003 sales.
"We are carefully monitoring our level of dealer inventories as we move
into the second quarter, typically our strongest quarter of the year. While we
continue to experience positive results, the overall sales environment for
recreational products is not as favorable as it was in 2002. We are concerned
about the possible effects on our sales of the timing and strength of the
economic recovery, the war with Iraq, and recent increases in fuel prices. We
will use Marine Products' strong capital position and cash flow generating
potential to sustain our business, should we be affected by declining consumer
confidence and economic uncertainty."
Marine Products Corporation (Amex: MPX) designs, manufactures and
distributes premium-branded Chaparral sterndrive pleasure boats and Robalo
outboard offshore fishing boats, and continues to diversify its product line
through product innovation and strategic acquisition. With premium brands, a
solid capital structure, and a strong independent dealer network, Marine
Products Corporation is prepared to capitalize on opportunities to increase its
market share and to generate superior financial performance to build long- term
shareholder value. For more information on Marine Products Corporation visit
www.marineproductscorp.com.
Certain statements and information included in this press release
constitute "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements
include statements regarding our ability to continue to gain market share, the
outlook for the industry, continued demand for our products and our ability to
continue to generate superior financial performance. These statements involve
known and unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of Marine Products Corporation to be
materially different from any future results, performance or achievements
expressed or implied in such forward-looking statements. These risks include
possible decreases in the level of consumer confidence impacting discretionary
spending, increased interest rates, deterioration in the quality of Marine
Products' network of independent boat dealers or a decrease in the number of
dealers. Additional discussion of factors that could cause the actual results to
differ materially from management's projections, forecasts, estimates and
expectations is contained in Marine Products' Form 10-K, filed with the
Securities and Exchange Commission for the year ending December 31, 2002.
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In thousands except per share data)
Periods ended March 31, (Unaudited)
First Quarter
% BETTER
2003 2002 (WORSE)
Net Sales $50,107 $38,323 30.7%
Cost of Goods Sold 38,015 30,185 (25.9)
Gross Profit 12,092 8,138 48.6
Selling, General and Administrative
Expenses 5,652 4,283 (32.0)
Operating Income 6,440 3,855 67.1
Interest Income 113 156 (27.6)
Income Before Income Taxes 6,553 4,011 63.4
Income Tax Provision 2,359 1,524 (54.8)
NET INCOME $4,194 $2,487 68.6%
EARNINGS PER SHARE
Basic $0.25 $0.15 66.7%
Diluted $0.23 $0.14 64.3%
AVERAGE SHARES OUTSTANDING
Basic 16,929 16,901
Diluted 17,890 17,747
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
At March 31, (Unaudited)
(in thousands)
2003 2002
ASSETS
Cash and cash equivalents $23,652 $10,124
Marketable securities 3,331 3,490
Accounts receivable, net 4,209 2,219
Inventories 17,774 14,526
Deferred income taxes 2,797 2,239
Prepaid expenses and other current assets 1,266 937
Current assets 53,029 33,535
Property, plant and equipment, net 16,772 14,100
Intangibles, net 3,848 3,888
Marketable securities 3,707 8,358
Other assets 928 410
Total assets $78,284 $60,291
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $3,965 $2,066
Other accrued expenses 13,792 9,261
Current liabilities 17,757 11,327
Deferred taxes and other liabilities 842 308
Total liabilities 18,599 11,635
Common stock 1,710 1,711
Capital in excess of par value 37,615 39,156
Earnings retained 20,275 7,789
Accumulated comprehensive income 85 --
Total stockholders' equity 59,685 48,656
Total liabilities and stockholders' equity $78,284 $60,291
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, (Unaudited)
(In Thousands)
2003 2002
Operating Activities:
Net income $4,194 $2,487
Depreciation and amortization 571 584
Other non-cash charges to
earnings (179) (310)
Changes in working capital 4,488 1,619
Net cash provided by
operating activities 9,074 4,380
Investing Activities:
Capital expenditures (1,091) (297)
Other investing activites 739 1,411
Net cash (used for) provided
by investing activities (352) 1,114
Financing Activities:
Payment of dividends (684) (341)
Cash paid for common stock
purchased and retired (811) --
Other financing activities 146 18
Net cash used for financing
activities (1,349) (323)
Net increase in cash and cash
equivalents 7,373 5,171
Cash and cash equivalents at
beginning of period 17,280 4,953
Cash and cash equivalents at end of
period $24,653 $10,124
For information contact:
BEN M. PALMER JIM LANDERS
Chief Financial Officer Corporate Finance
404.321.7910 404.321.2162
irdept@marineproductscorp.com