Exhibit 99
Marine Products Corporation Reports Record 2003 Second Quarter Results
* Net sales increased by 10 percent over prior year
* Earnings per share increased by 40 percent over prior year
ATLANTA, July 23 /PRNewswire-FirstCall/ -- Marine Products Corporation
(Amex: MPX) announced its unaudited results for the quarter and six months ended
June 30, 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 sportfishing
boats by Robalo.
For the quarter ended June 30, 2003, Marine Products generated net sales
of $51,951,000, a 10.1 percent increase compared to $47,193,000 last year, the
highest quarterly net sales amount in its history. The increase in net sales was
due to a 3.4 percent increase in the number of boats sold coupled with a 5.6
percent increase in the average selling price per boat. Gross profit for the
quarter was $13,551,000, a 29.8 percent increase over the same period in 2002.
Gross profit as a percentage of sales was 26.1 percent, an increase of 4.0
percentage points compared to the second 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, increased sales of cruisers
which generate higher gross margins, improvements at Robalo, and various
adjustments to accruals that are routinely recorded in the second quarter as a
result of the completion of the current model year. The gross profit improvement
at Robalo was also due to the increased production volume and a 29.0% increase
in unit sales over the second quarter of 2002.
Operating income for the quarter was $7,529,000, a 33.0 percent increase
compared to the second 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 incentive compensation, sales commissions, and warranty expense.
Net income for the quarter ended June 30, 2003 was $4,961,000, a 37.4
percent increase compared to $3,611,000 in the prior year. Net income increased
due to higher operating and interest income. The effective tax rate was 36
percent compared to 38 percent in the prior year, which had the effect of
increasing net income by $154,000 or $0.01 per diluted share. Diluted earnings
per share for the quarter were $0.28, a 40.0 percent increase compared to $0.20
diluted earnings per share in the prior year. During the quarter, the Company
repurchased 95,000 shares of its common stock for cash on the open market under
its stock buyback program.
Net sales for the six months ended June 30, 2003 were $102,058,000, a 19.3
percent increase from the first six months of fiscal 2002. Net income for the
six-month period increased 50.1 percent to $9,154,000 or $0.51 diluted earnings
per share compared to $6,098,000 or $0.34 diluted earnings per share last year.
Richard A. Hubbell, Marine Products' Chief Executive Officer stated, "The
second quarter of 2003 continued the strong performance of the first quarter of
this year. Dealer orders continue to be strong, following an outstanding boat
show season."
Hubbell continued, "Our average unit sales price rose by more than five
percent during the quarter, primarily due to greater volume from our larger,
value-added Signature Cruisers coupled with increased production and higher
average sales prices due to recently available larger models in our Robalo
sportfishing line. Robalo accounted for over seven percent of net sales this
quarter. Improved financing terms in the retail sector are spurring consumers to
purchase larger boats and upgraded models. While Marine Products is not involved
in financing consumer boat purchases, we benefit from a low-interest rate
environment as the number and size of boats sold increases.
"We are carefully monitoring our level of dealer inventories as we
introduce the new model line up for fall. While the third quarter is seasonally
a slow quarter, it is very interesting to see our dealers' and the public's
reaction to the 2004 model line-up. These models will debut at our dealer
conference this August. We continue to experience positive results, and are
gratified that the American public continues to view recreational boating as a
fun, affordable way to spend its leisure time. We are also pleased to report a
continued strong financial position, which we intend to use to take advantage of
future growth opportunities."
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 take advantage of market
opportunities, sustain our market share, and build long-term shareholder value.
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 availability of financing of their inventory. 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 June 30,
(Unaudited) Second Quarter Six Months
BETTER BETTER
2003 2002 (WORSE) 2003 2002 (WORSE)
Net Sales $51,951 $47,193 10.1% $102,058 85,516 19.3%
Cost of Goods Sold 38,400 36,752 (4.5) 76,415 66,937 (14.2)
Gross Profit 13,551 10,441 29.8 25,643 18,579 38.0
Selling, General and
Administrative Expenses 6,022 4,781 (26.0) 11,675 9,064 (28.8)
Operating Income 7,529 5,660 33.0 13,968 9,515 46.8
Interest Income 222 165 34.5 335 321 4.4
Income Before Income
Taxes 7,751 5,825 33.1 14,303 9,836 45.4
Income Tax Provision 2,790 2,214 (26.0) 5,149 3,738 (37.7)
NET INCOME $4,961 $3,611 37.4% $9,154 6,098 50.1%
EARNINGS PER SHARE
Basic $0.29 $0.21 38.1% $0.54 0.36 50.0%
Diluted $0.28 $0.20 40.0% $0.51 0.34 50.0%
AVERAGE SHARES
OUTSTANDING
Basic 16,854 16,955 16,892 16,928
Diluted 17,757 17,950 17,826 17,855
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
At June 30, (Unaudited) (in thousands)
2003 2002
ASSETS
Cash and cash equivalents $20,326 $17,342
Marketable securities 2,965 863
Accounts receivable, net 6,037 2,830
Inventories 18,172 14,903
Deferred income taxes 3,102 2,182
Prepaid expenses and other current
assets 740 707
Total current assets 51,342 38,827
Property, plant and equipment, net 18,017 14,281
Intangibles, net 3,838 3,878
Marketable securities 5,383 7,818
Other assets 1,320 420
Total assets $79,900 $65,224
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $3,437 $3,948
Federal income taxes payable 1,951 227
Other accrued expenses 9,329 8,365
Total current liabilities 14,717 12,540
Deferred taxes and other liabilities 2,233 951
Total liabilities 16,950 13,491
Common stock 1,709 1,717
Capital in excess of par value 36,637 38,932
Deferred compensation (282) (386)
Earnings retained 24,861 11,470
Accumulated comprehensive income 25 0
Total stockholders' equity 62,950 51,733
Total liabilities and stockholders'
equity $79,900 $65,224
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, (Unaudited)
(In Thousands)
2003 2002
Operating Activities:
Net income $9,154 $6,098
Depreciation and amortization 1,144 1,058
Other non-cash credits to
earnings (653) (238)
Changes in working capital 916 2,692
Net cash provided by
operating activities 10,561 9,610
Investing Activities:
Capital expenditures (2,873) (916)
Other investing activities (1,632) 4,578
Net cash (used for) provided
by investing activities (4,505) 3,662
Financing Activities:
Payment of dividends (1,366) (683)
Cash paid for common stock
purchased and retired (2,046) (509)
Other financing activities 402 309
Net cash used for financing
activities (3,010) (883)
Net increase in cash and cash
equivalents 3,046 12,389
Cash and cash equivalents at
beginning of period 17,280 4,953
Cash and cash equivalents at end of
period $20,326 $17,342
For information contact:
BEN M. PALMER
Chief Financial Officer
404.321.7910
irdept@marineproductscorp.com
JIM LANDERS
Corporate Finance
404.321.2162
SOURCE Marine Products Corporation
-0- 07/23/2003
/CONTACT: Ben M. Palmer, Chief Financial Officer, +1-404-321-7910, or
irdept@marineproductscorp.com , or Jim Landers, Corporate Finance,
+1-404-321-2162, both of Marine Products Corporation/
/Web site: http://www.marineproductscorp.com /
(MPX)
CO: Marine Products Corporation
ST: Georgia
IN: MAR
SU: ERN