Exhibit 99
Marine Products Corporation Reports Third Quarter Results
* Net sales for the quarter increased 40.6 percent over prior year
* Diluted Earnings per share for the quarter were $0.23, an increase of
35.3 percent over prior year
ATLANTA, Oct. 27 /PRNewswire-FirstCall/ -- Marine Products Corporation
(Amex: MPX) announced its unaudited results for the quarter ended September
30, 2004. Marine Products is a leading manufacturer of fiberglass boats under
two brand names: sterndrive and inboard pleasure boats by Chaparral, including
SSi Sportboats, Sunesta Deckboats, and Signature Cruisers, and outboard sport
fishing boats by Robalo.
For the quarter ended September 30, 2004, Marine Products generated net
sales of $63,129,000, a 40.6 percent increase compared to $44,903,000 last
year. The increase in net sales was due to a 30.1 percent increase in the
number of boats sold, a 7.9 percent increase in the average sales price per
boat, and an increase in parts and accessories sales. All four boat lines
experienced increased unit sales and higher average sales prices. The
increase in unit sales was highlighted by increased sales of Robalo sport
fishing boats and SSi Sportboats. The increase in average sales prices was due
to higher sales of larger SSi Sportboats, and a favorable model mix at Robalo.
Gross profit for the quarter was $17,117,000, or 27.1 percent of net sales,
compared to $11,503,000, or 25.6 percent of net sales, in the prior year. The
increase in gross profit as a percentage of net sales was due primarily to
higher average sales prices and production efficiencies realized at higher
production volumes.
Operating income for the quarter was $9,642,000, a 46.8 percent increase
compared to the third quarter last year due to higher gross profit, partially
offset by higher selling, general and administrative expenses. Operating
income was 15.3 percent of net sales for the quarter compared to 14.6 percent
of net sales in the prior year. Selling, general and administrative expenses
increased primarily due to costs that vary with sales and profitability, such
as sales commissions, other incentive compensation and warranty expense, but
also included increased costs associated with public company compliance. As a
percentage of net sales, selling, general and administrative expenses
increased to 11.8 percent in the third quarter compared to 11.0 percent last
year.
Net income for the quarter ended September 30, 2004 was $6,244,000, a 40.0
percent increase compared to $4,459,000 in the prior year. Net income
increased due to higher operating income, partially offset by a higher
effective tax rate compared to the prior year. The effective income tax rate
during the third quarter was 36.2 percent compared to an effective tax rate of
32.9 percent in the prior year. The income tax provision in the third quarter
of 2003 included an adjustment to reduce the estimated effective tax rate from
36 percent to 35 percent. The effective tax rate change increased 2003 third
quarter net income by approximately $140,000, or $0.01 per diluted share.
Diluted earnings per share for the quarter were $0.23, a 35.3 percent increase
compared to $0.17 diluted earnings per share in the prior year.
Net sales for the nine months ended September 30, 2004 were $189,734,000,
a 29.1 percent increase from the first nine months of 2003. Net income for
the nine-month period increased 34.3 percent to $18,286,000 or $0.67 diluted
earnings per share compared to $13,614,000 or $0.51 diluted earnings per share
in the prior year.
Richard A. Hubbell, Marine Products' Chief Executive Officer stated, "The
third quarter results of 2004 continue to reflect our strong performance that
began over two years ago. All of our lines sold well this quarter, and our
overall model mix improved average sales prices as well. Dealer inventory has
increased over historically low levels of one year ago. However, our order
backlog at the end of the quarter is higher than at the same time last year,
indicating continued strong demand from our dealers. We recently held our
dealer conferences for Chaparral and Robalo, and the indications from these
meetings are that dealer orders will continue to be strong during the fourth
quarter and into the winter boat show season.
Hubbell continued, "The end of the third quarter was marked by several
severe hurricanes in Florida, which is a large boating market and an important
market for Marine Products Corporation. We are pleased to report that our
financial results for the quarter were not negatively impacted by these
storms, due to our backlog of orders from dealers in the other markets we
serve. Furthermore, all of our dealers in the areas impacted by these storms
have resumed normal operations. Shipments to our Florida dealers that were
delayed by the hurricanes in September were made early in the fourth quarter."
Marine Products Corporation (Amex: MPX) designs, manufactures and
distributes premium-branded Chaparral sterndrive and inboard pleasure boats
and Robalo sport 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 our website at http://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, increase our market share, and build long-term shareholder
value, and our belief that dealer orders will continue to be strong in the
fourth quarter of this year and into the winter boat show season. 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, business interruptions due to
adverse weather conditions, increased interest rates, changes in consumer
preferences, deterioration in the quality of Marine Products' network of
independent boat dealers or availability of financing of their inventory, and
competition from other boat manufacturers and 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, 2003.
Marine Products Corporation will host a conference call to review the
Company's financial and operating results on Wednesday, October 27, 2004 at
9 a.m. Eastern Time. Individuals wishing to participate in the conference
call should call (866) 864-9123 or (706) 679-5285 for international callers.
For interested individuals unable to join the call, a replay will be available
until midnight on November 3, 2004 by dialing (800) 642-1687 or
(706) 645-9291, conference ID 1365355. This call also will be broadcast and
archived on the company's investor Web site
at http://www.marineproductscorp.com. Interested parties are encouraged to
click on the webcast link 10-15 minutes prior to the start of the conference
call.
For information about Marine Products Corporation, please contact:
BEN M. PALMER
Chief Financial Officer
404.321.7910
irdept@marineproductscorp.com
JIM LANDERS
Corporate Finance
404.321.2162
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (In thousands except per share data)
Periods ended September 30, (Unaudited)
Third Quarter
% BETTER
2004 2003 (WORSE)
Net Sales $63,129 $44,903 40.6 %
Cost of Goods Sold 46,012 33,400 (37.8)
Gross Profit 17,117 11,503 48.8
Selling, General and Administrative
Expenses 7,475 4,937 (51.4)
Operating Income 9,642 6,566 46.8
Interest Income 139 75 85.3
Income Before Income Taxes 9,781 6,641 47.3
Income Tax Provision 3,537 2,182 (62.1)
NET INCOME $6,244 $4,459 40.0 %
EARNINGS PER SHARE
Basic $0.24 $0.18 33.3 %
Diluted $0.23 $0.17 35.3 %
AVERAGE SHARES OUTSTANDING
Basic 25,699 25,405
Diluted 27,202 26,847
Nine Months
% BETTER
2004 2003 (WORSE)
Net Sales $189,734 $146,961 29.1 %
Cost of Goods Sold 139,923 109,815 (27.4)
Gross Profit 49,811 37,146 34.1
Selling, General and Administrative
Expenses 22,130 16,611 (33.2)
Operating Income 27,681 20,535 34.8
Interest Income 375 410 (8.5)
Income Before Income Taxes 28,056 20,945 34.0
Income Tax Provision 9,770 7,331 (33.3)
NET INCOME $18,286 $13,614 34.3 %
EARNINGS PER SHARE
Basic $0.71 $0.54 31.5 %
Diluted $0.67 $0.51 31.4 %
AVERAGE SHARES OUTSTANDING
Basic 25,618 25,362
Diluted 27,166 26,788
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
At September 30, (Unaudited) (in thousands)
2004 2003
ASSETS
Cash and cash equivalents $34,757 $21,629
Marketable securities 5,291 1,689
Accounts receivable, net 4,762 6,784
Inventories 25,908 19,890
Income taxes receivable 945 1,265
Deferred income taxes 2,442 1,979
Prepaid expenses and other current assets 974 816
Total current assets 75,079 54,052
Property, plant and equipment, net 18,212 17,955
Intangibles, net 3,788 3,828
Marketable securities 5,762 5,557
Other assets 2,488 1,366
Total assets $105,329 $82,758
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable $7,824 $4,534
Other accrued expenses 9,158 7,559
Total current liabilities 16,982 12,093
Pension liabilities 2,323 1,277
Deferred income taxes 772 1,131
Other long-term liabilities 1,734 1,557
Total liabilities 21,811 16,058
Common stock 2,596 2,573
Capital in excess of par value 35,825 35,716
Retained earnings 47,609 28,637
Accumulated other comprehensive (loss) income (515) 30
Deferred compensation (1,997) (256)
Total stockholders' equity 83,518 66,700
Total liabilities and stockholders' equity $105,329 $82,758
Certain prior year balances have been reclassified to conform with the
current year presentation.
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, (Unaudited) (in thousands)
2004 2003
Operating Activities:
Net income $18,286 $13,614
Depreciation, amortization and other non-cash
charges 1,921 1,741
Other net changes in operating activities 24 (3,278)
Net cash provided by operating activities 20,231 12,077
Investing Activities:
Capital expenditures (2,146) (3,372)
Other investing activities (3,774) (603)
Net cash used for investing activities (5,920) (3,975)
Financing Activities:
Payment of dividends (3,086) (2,051)
Cash paid for common stock purchased and retired (3,544) (2,271)
Other financing activities 832 569
Net cash used for financing activities (5,798) (3,753)
Net increase in cash and cash equivalents 8,513 4,349
Cash and cash equivalents at beginning of period 26,244 17,280
Cash and cash equivalents at end of period $34,757 $21,629
SOURCE Marine Products Corporation
-0- 10/27/2004
/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 REA
SU: ERN CCA MAV