OneWater releases Q4 results

OneWater has announced results for its fiscal fourth quarter and year ended September 30, 2022.

Fiscal Year 2022 Highlights

  • Record revenue increased 42% to $1.74 billion
  • Same-store sales increased 12%
  • Gross profit margin expanded 260 basis points to 31.7%
  • Record Net income increased 31% to $153 million
  • Net income per diluted share attributable to OneWater increased 31% to $9.13
  • Record Adjusted EBITDA1 increased 59% to $248 million
  • Completed eight strategic acquisitions and announced two acquisitions that are expected to close in the first quarter of fiscal 2023

“We closed out another successful year, with fiscal 2022 revenues growing 42% and Adjusted EBITDA1 growing 59%. Our team executed flawlessly despite challenges spurred on by a constrained supply chain and strong consumer demand throughout the year,” commented Austin Singleton, Chief Executive Officer at OneWater. “Our robust acquisition cadence, coupled with our focus on diversifying our business to expand our finance and insurance, and parts and service revenue, has established a proven model that continues to outperform the industry.”

“Recently, we have seen a strong start to the boat show season, reinforcing the healthy demand environment. As we look to fiscal year 2023, we are confident that our strategy will propel us forward to deliver long-term value for all our stakeholders,” concluded Mr. Singleton.

Fiscal Fourth Quarter 2022 Results

Revenue for fiscal fourth quarter 2022 was $397.5 million, an increase of 41.8% compared to $280.3 million in fiscal fourth quarter 2021. The growth was primarily attributable to both sales of acquired businesses, with strong contribution from acquired revenues related to service, parts and other sales, as well as an increase in same-store sales. During fiscal fourth quarter 2022 same-store sales increased 4% compared to fiscal fourth quarter 2021, primarily as a result of the continued strong demand environment. Hurricane Ian, which hit late in the fourth quarter, negatively impacted sales by approximately $25 million.

New and pre-owned boat revenue increased 22.4% and 33.0%, respectively, compared to the prior year quarter, driven by an increase in the unit sales of new and pre-owned boats. Finance & insurance income was up 31.7% and service, parts and other sales was up 200.6%, both compared to the prior year quarter, largely as a result of the Company’s newly acquired businesses and same-store sales growth.

Gross profit totaled $126.2 million for fiscal fourth quarter 2022, up $36.9 million from $89.3 million for fiscal fourth quarter 2021. Gross profit margin of 31.7% was down slightly compared to the prior year period due to the shift in the mix and size of boat models sold during the quarter partially offset by the significant increase in higher margin service, parts & other income.

Fiscal fourth quarter 2022 selling, general and administrative expenses totaled $79.7 million, or 20.0% of revenue, compared to $55.4 million, or 19.8% of revenue, in fiscal fourth quarter 2021. The slight increase in selling, general and administrative expenses as a percentage of revenue was due mainly to newly acquired businesses.

Net income for fiscal fourth quarter 2022 totaled $22.3 million, compared to $22.5 million in fiscal fourth quarter 2021. Earnings per diluted share for fiscal fourth quarter 2022 was $1.28 per diluted share, compared to $1.35 per diluted share in 2021. For fiscal fourth quarter 2022, charges related to transaction costs, contingent consideration and costs incurred related to Hurricane Ian adversely impacted net income and diluted earnings per share. These amounts, tax effected at 25%, were approximately $0.17 per diluted share.

Fiscal fourth quarter 2022 Adjusted EBITDA1 increased 35.3% to $45.4 million compared to $33.6 million for fourth quarter 2021.

Fiscal Year Ended September 30, 2022 Results

Revenue for the fiscal year ended September 30, 2022 increased 42.1% to $1,744.8 million from $1,228.2 million for the fiscal year ended September 30, 2021, driven by an increase in average unit price of new boats, an increase in unit sales of pre-owned boats, and acquisitions completed during the year, which contributed to a 164% increase in service, parts and other sales compared to the prior year. Same store sales increased 12% compared to the prior year.

Gross profit totaled $553.6 million for the fiscal year 2022, compared to $357.5 million for the fiscal year 2021. Gross profit margin of 31.7% increased 260 basis points compared to the prior year primarily due to the shift in the mix and size of boats sold, dynamic pricing and the significant increase in higher margin service, parts & other income.

Fiscal year 2022 selling, general and administrative expenses totaled $302.1 million, or 17.3% of revenue, compared to $199.0 million, or 16.2% of revenue in fiscal year 2021. The increase in selling, general and administrative expenses as a percentage of revenue was due mainly to higher variable personnel costs driven by the increased level of profitability in the fiscal year and increased costs given the current personnel environment.

Net income for fiscal year 2022 totaled $152.6 million compared to $116.4 million in fiscal year 2021, an increase of 31.1%. The increase is primarily due to the increase in sales and gross margins in fiscal year 2022. Earnings per diluted share for fiscal year 2022 was $9.13, compared to $6.96 per diluted share in 2021. For fiscal year 2022 charges related to transaction costs, contingent consideration and costs incurred related to Hurricane Ian adversely impacted diluted earnings per share. These amounts, tax effected at 25%, were approximately $0.90 per diluted share. Fiscal year 2022 Adjusted EBITDA1 increased 58.9% to $247.6 million, excluding the costs associated with Hurricane Ian, compared to $155.8 million in fiscal year 2021.

As of September 30, 2022, the Company’s cash and cash equivalents balance was $42.1 million and total liquidity, including cash and availability under credit facilities, was in excess of $100.0 million. Total inventory as of September 30, 2022, increased sequentially to $373.0 million compared to $269.4 million on June 30, 2022, as industry-wide supply chain constraints began to ease during the fourth quarter and also due to inventory contributions from recently completed acquisitions.

Total long-term debt as of September 30, 2022, was $442.8 million, and adjusted long-term net debt (net of $42.1 million cash)1 was 1.6 times trailing twelve-month Adjusted EBITDA1.

Source: https://boatingindustry.com/news/2022/11/16/onewater-releases-q4-results/