Brunswick (BC) 27 Apr 232023 Q1 Earnings call transcript

Good morning, and welcome to Brunswick Corporation's First Quarter 2023 Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer period. Today's meeting will be recorded.

If you have any objections, you may disconnect at this time.

I would now like to introduce Neha Clark, Senior Vice President, Enterprise Finance of Brunswick Corporation. ahead. go Please

thank and joining us. Good you morning, for

morning me CFO. Brunswick's Foulkes, the this on call are CEO; Dave With and Ryan Gwillim,

we that this expectations. prepared remind our about from future include begin these would keep statements results Before to in could Please like materially mind certain remarks, forward-looking everyone actual our call, I during results. comments our will that with differ

please refer today's For to recent to details on and these SEC press consider, release. factors filings our

are documents these All our on of at brunswick.com. available website

we our non-GAAP unaudited the the the During are non-GAAP referring financial and information. will of in presentation, be financial consolidated to financial Reconciliations appendix provided to presentation sections certain to statements this of accompanying GAAP reconciliation results. measures today's

the over call turn Dave. to will I now

and good everyone. Neha, morning, Thanks,

year delivering of earnings of quarter net the $X.X and started first strongly, adjusted sales billion record $XXX operating than more We million.

manufacturing innovation that manufacturing technology enterprise, reduce business be high in new actions environment significant in Our products, structural outboard challenging. and to our investments to costs to a across the continued while taking capacity macroeconomic and continues premium leverage horsepower capacity, boat

the first of the robustness and $X.XX adjusted our earnings highlights Our our business portfolio. per of of quarter share strength

consecutive net product highlights, despite Propulsion certain including fourth There margin, were notable increased divisional operating on business, sales, delivering promotion discounting lines. earnings our business, quarter our margins delivering the operating for outstanding Boat adjusted and and operating and double-digit adjusted

the core pipeline quarter an global at season. with is inventory in exited categories into field level first units. retail Boat most going And we appropriate the XX,XXX

challenges. supply prior above year, levels some boat Our production and engine chain finished despite

improving driven XXXX, improvements working made across the significant by flow, XX% first versus quarter gains largely We free in capital business. cash

aggressive continued the in share overall leisure quarter. with the repurchases continue the to repurchases, be to market sector as addition, valuation $XX executing of pressures, In million we see recreation and and

segments The Parts from the Parts now Navico regarding segment Propulsion, four: We three reminder & reportable and reportable segment. Navico Engine into and Accessories our segment let segments the me & segment reporting. previous move Boat. updated & I Engine updated is recently the our to segment Before overview, Accessories, Group Parts provide Accessories into a split Group

of & primarily and parts Accessories related businesses. systems, segment with to propulsion The of electrical boat systems, is oils such and inclusive our Engine parts distribution products together our comprised Parts third-party consumables, products and and lubricants, as

business, The Navico now Group the late with key legacy organizational segment that completed XXXX, acquisitions between Group Advanced integration ReLiON. and represents the in were Systems two Navico

the Navico segments was integration change We given the early change of reportable the XXXX. and align actions significant structure. completed our continued closely more right to internal company We time operating our better with visibility in determined into feel our provide the the this business will and restructuring

segment me let prior that comparison. very now background, facilitated of some that With the a record first strong the highlights year to turn quarter, despite

recent manufacturing Propulsion many Our of of quarter first drove increased products, operating outstanding results, of enabled and by X% product high-horsepower products, mix, resulted expansion. production operational international shipments operating deliver strong The XX%. XXXX, margin first by customers capacity OEM the the outboard high-horsepower increased with versus of in with earnings quarter top-line shipments coupled growth reduced business when an of to driven partners, and continues to combined record which, product efficiencies, with lower-horsepower

businesses rightsized anticipated, U.S. and of as were XXXX sales Accessories versus although the and XXXX. up versus declines quarter, third-party but as inventories. business the while of ahead sales down of a quarter & experienced Parts Engine XX% first first product record retailers XXXX, dealers first quarter earnings had our were versus quarter Our solid XXXX, distribution

leading lower offset and new workforce. temporary to year versus pressures March. coupled actions to positive start Navico Operating sales by top cost XX% as the and quarter, and into launch, unfavorable partially completed locations XXXX, As to declines integration and currency, in declined in in the Group line reduction reduction challenging with quarter, actions OEMs restructuring the the prior of foreseen, a channel to earnings impacted impact headcount were of margin of major sales, early related improvements Navico Group higher retail and a with announced measures. QX product with Navico lower nine begun and approximately the the closure had which inflation Group notable RV material

operating growth our growth, discounts. Boat broad-based quarter for top-line gains categories. delivered double-digit higher the business adjusted margins fourth enabled by consecutive Finally, with earnings posted across despite segment strong robust Boat

growth Finally, across in XXX Freedom generating sales covering membership than also completed quarter QX and from Boat members Club trajectory membership locations Freedom's in continues sales our network-wide, XXXX. XX,XXX more nearly agreements while had the synergy and exceptionally strong with portfolio. XX,XXX benefited all strong acquisitions same-store marine

remain a both challenge with between products, Looking and X% recently of moderated buyers have X% at cost increases external X% loan pre-COVID. factors, for will immediately interest inflation stabilizing X% or and value versus rate rates to

improved. has supply Our environment significantly broadly chain

impacted through of be part However, in dealer the but it quarter. in in our remedied the large part and the inventory quarter, was QX. second in It recall of expect it SSI the fully and impact an a number production early quarter, industry-wide supplier remedied we partially to may units sterndrive in fiberglass

strong the As results Ray Show, a in particularly are our than at the lead We generation. shows of to in we share. Beach of and better continued boats these Whaler, believe record have signal consumer many Boat products. interest, reporting more boat good cases, as share particular, with Mercury premium Boston displayed such shows, and were than XX% expected, sales shows edges the recent on Palm had International bulk and in of Sea wrap

internal boat prior and year, trends Our are down. boater slightly suggests above Google sentiment participation purchase with survey search consideration

is Boat experiencing versus member year. Freedom trips per Additionally, Club higher prior

is percentage XXXX and of Discounting boats being lower the but transactions while value levels to models, is levels sale present of in primarily returned point XXXX. cases, below in financed than pre-COVID on similar has to at versus all-cash still most

of are From in the higher inventory considering cases. levels very dollar standpoint, addition current many units season. dealer the the ahead healthy inventory of value Dealers to a in number and are of

orders track no concerns, However, wholesale optimistic Dealer signs remains reflects the of peak we cautiously cancellations. with macro into move as remain but material sentiment on season.

Shifting segments. global acquisitions, Boat on delivered in to a view our basis, Overall, by currency Propulsion revenue. X% growth excluding sales gains we of constant and a led

significant in those Our markets. the Europe, increased prior quarter X%, engines year two by versus largest sales And experienced grew of driven the primarily respectively. in X% U.S. sales regions, by World quarter outboard first Rest growth, high-horsepower of the and and

U.S. retail to performance. now Moving

boat month throughout data February with prior quarter, in March. improvement retail sequential new of in unit the shifting declines growth reflected internal versus year of Our to X% the and January

For boat unit XXXX. finished the of retail than new internal quarter, better declining expectations, sales quarter first slightly XX% the our versus

segments pressure. while experienced models some value to continue premium well, fiberglass perform Overall,

Our aluminum and had brands performance early as promotions internal retail retail particularly activity. our strong planned drive marketing season helped

data Note reporting the gap first earlier from SSI XX% a main industry roughly reflected which in months. week internal close more powerboat that preliminary this as released the may data, becomes a versus complete quarter decline coming our XXXX,

down the XXX to points reflect in for year performance with engines gain was the during first data versus the quarter up in retail U.S. over just and first quarter the Outboard above industry last of gains high-horsepower, X% XX% favorable, continues five engine of month versus March for with XXXX. categories share finishing registrations XXX-horsepower industry prior Mercury years. and

pre-COVID U.S. below retail and selling level. pipelines. remains units generally to we season, Turning enter unit inventory thousands balanced of well as is the core

also the restocked, expected, has remains As to pipeline level. aluminum more premium inventory while fiberglass inventory normalized of some lean lines. a for fiberglass product is product replenished Value

Our our season, ahead coming the generating job brands out very positive XXXX the season selling shows. have prime getting new our many products done an to of early of excellent boat dealers exciting momentum

selling discounts We into appropriate through months. place and and continue have in monitor needed to primary and respond programs, as coming season, we'll also the going events the

I'll the our over to performance now to provide and financial outlook. Ryan turn comments additional call on

morning, Dave, everyone. good Thanks, and

compared first quarter by prior with up sales our an Brunswick adjusted excellent to start and any first year, sales delivered XXXX, X% EPS in increased $X.XX net of to history. quarter for EPS When X%. and record were

exceeded year-over-year, results the and anticipated, down As for adjusted quarter. both were slightly operating margins earnings expectations our but

on Sales margin versus efforts, performance and growth and by in in implemented pricing quarters, the changes partially demand, steady previous XXXX from The offset steady from costs unfavorable offset and sales performance earnings resulted cost rates. benefited elevated new initiatives. growth containment product QX of spending input foreign growth prudent net currency exchange and by

cash always million quarter primarily we as although for usage. out our from the less in the selling season, due by net XXXX, a first flow of to coming position working capital are improved we usage primary cash prepare $XXX QX free Lastly,

and segment, another reporting our of delivered each margin operating quarter at performance. top-line, Now outstanding we'll look business, which with earnings Propulsion yet starting

driven X% sales increased and quarter were in versus first Revenue offset horsepower product, sterndrive outboard by sales the continued XXXX, higher increased reductions value. of more of planned than which smaller high-horsepower as

Operating reverse have the segment variances. full the on margins and expected no benefit capitalized will by of increased net Note sales in earnings year XX%, efficiencies. and enabled the results. were second basis margins and up the included quarter and with XXX each also timing inventory operating This up the points that manufacturing impact benefit earnings associated

in over and down XX% quarter products U.S. our markets the third-party a with business by up by Parts but business. business Sales sales Accessories Engine our but Our X%, delivered & were in steady international XXXX. in quarter, XX% softness XXXX, offset distribution first increased of versus

in appropriate scrambling they to to supply due season. have business. and dealers normal inventory where are Dealer and XXXX to season levels seasonality contrary anticipate chain the And to XXXX, we take and restocking normal returned patterns the were could retail get all start concerns, early this inventory

and addition quarter the declines. as the additional Earnings in sales to anticipated, down with two drivers margins were in

XXXX, saw of of inflation increases second business better XXXX quarter quarter a leaving XXXX, in position. cost QX first in the as comparison First, to year-over-year input this cost of its much the material created a challenging most

distribution Indiana, the to season. facility to boating the Wisconsin year of the first our customers continue new in Second, ensure to both due the to state-of-the-art running product resulting elevated in sufficient to in Brownsburg, start we primary quarters facilities Fond our hub du costs from Lac, supply of our two transition in

flat XXXX, quarter. Group OEM off were percent low-teens RV mentioned was marine restocking to Our reduction down impacts FX Engine due to slide. to with the the Unfavorable performance channels a sales the Navico first shutdowns, the in sales sharp down to contributed sales the customers lower and first in on with same a last historic similar dynamics also quarter to XX% aftermarket in Sales I manufacturers, production due to the quarter. quarter P&A,

already proven new retailer remains the with Pro, February driven that strength the HDS be across in channel has well to Note which the retail solid launched point-of-sale including by market. extremely and was in received products,

helped Navico unfavorable product actions inflation margins impacts, by also were of margin pressures impacted Group reductions operating planned launch and XXXX, a FX earnings as but related as and were negatively earlier. by temporary restructuring discussed material versus new hold, Dave to in take expenses QX

to additional thought the Engine some helpful information P&A Navico impacting We Group provide factors businesses. our would on and it be various

As year anticipated, the of comparisons but on the to historically initially XXXX, remainder as first quarter we challenging due in to track strong remains January. materially was planned believe the

will thoughts This year. earnings on the these remainder chart shows the the for slides, the factors believe our segment discussed how factors quarter and we on first two I earnings shows of also previous impact

also significant of into dealer should toughest throughout factor and Inflation and patterns year-over-year to the improve the most quarter that the season. believe stocking the had boating off-season as first the believe retail and comparison. remainder patterns season moderate the the We but and will stocking impacting should holiday year impact earnings, continue through currency be

should only quarter. The P&A more the transition factor, center one impact distribution of only and impact is an Engine

of restarted. manufacturing, businesses, of high the the is these is during improve RV has production expected already percent year While the a to impact which only as the remainder for of single-digit RV sales

earnings power There moving earnings resolved be ultimately resiliency as factors are the transient boating we be pieces many healthy, of to will of these believe in segments. these participation showing continues But these the segments.

segment Boat earnings straight strong with together growth, double-digit and another Our operating quarter, top-line for the adjusted had quarter. margins fantastic fourth delivering

increased increase in and inflation of and completion our new offset levels levels in The XX% XX% growth earnings substantial versus of were by ramp-up and earnings mix, historical the XXXX, lower reported product cost by partially the sales, the activities with quarter. Boat enabled together operating net a although segment increase do positive a in margin facility, Whaler discounting Segment discounting from remain adjusted in and sales quarter first operating norms. continued Boston production higher than the

included segment's from lapped the revenue it will which acquisitions is completed benefited XXXX, quarter which beginning Club, half first be in business the the Boat Boat acceleration, quarter. Freedom of of in X% contributed as approximately next during substantially

outlook remains unchanged. XXXX Our materially

a year, strong in we healthy and turbulent needed quarters with to drive results to And shareholders our to While prudent on despite performance investments first plan. be going the financial continue start to provides a macroeconomic quarter our ability our future climate. we cost historically continue without spending our are actions for delivering optimistic remain sacrificing to strategic

due year guidance. result, a reiterating the operating full As generation. free adjusted full we And and we guidance, with we good expect season. movement anticipated to to see EPS have off primary and are not guide a continued while flow to We're revenue our well OpEx as our as year retail positive the holding margin start changed cash

solid QX a anticipate between and $X.XX. adjusted and we XXXX EPS revenue with slightly quarter flat of to above second $X.XX Finally,

outlook first with Our our small segment P&A updated well, reflect market and with and Group quarter for to as guidance remains full providing unchanged segments. conditions, performance mostly new Navico adjustments year along Engine

have For Mercury. at strength end of the continuing margin range, Propulsion, reflecting raised the operating bottom guided we

raised guidance also the balance the have support should performance thus in far the steady as retail Boat relatively of XXXX segment's wholesale remainder We year. bottom continued revenue the throughout of

similar our with year. segment guidance segments In to distribution XX down anticipating and slightly operating also or business, our margins to similar primarily year flat for Group look start be minus third-party despite revenue start for to basis And in anticipate first year, prior operating P&A, we the to quarter, a margins former softness slightly we In new Group, P&A anticipate Engine aggregated increased Navico sales The prior points prior versus flat guidance XXXX. in believe Engine Navico versus P&A to the will year. year. the full plus challenging the

we small full a year handful have assumptions of updated. we Lastly, that have

are average and diluted First, XX at repurchase outstanding given share of Brunswick cash our year for we million $XXX the increasing be dislocation, the year. target our strong to price slightly full shares. performance continued million and exceed for market repurchases Accordingly, shares lower our should

that per dividend and February increased share, the Finally, of $X.XX dividend our XXth you would have our seen portfolio reflecting annual overall makeup to the stability in increases, performance. operations, we of year financial

P&L sheet the and presentation this assumptions additional information the see Please for on of appendices other for balance year.

call for pass remarks. now I the Dave will back over to concluding

Ryan. Thanks,

update close out, recognition on and wanted I for awards we share brands, some recent our and an Before to products company, people.

Manufacturing through where ranking of the We list Companies, were delighted second to Engineering of Trustworthy be and were named by named within Most ranked and Large in by We Employers, as XXXX category. again, America's Equipment companies top also, its Manufacturing Industrial one in Forbes we Newsweek XX the category. America's the Best

more quarter, record number In during many forward innovation won a addition, and of we've the in of to winning year. the the and product first awards balance look

designation with landfills now of they X million subject XXXX. earned pounds from zero-waste-to-landfill diverted of more of have in year. And our combined, XX waste planned the facilities sustainability, On this

was reflection BBB by Our business the ESG, improved a of from as top-rated dedication to region a industry. rating were sustainably. our MSCI And both and conducting for A, Sustainalytics company to recognized our in we ESG

many be will and developments which in is be our shortly. These XXXX more sustainability to released sustainability scheduled documented report, in

my of highlight. year favorite the had a businesses. to and outstanding our We start an to now topics innovation, to future one key our Turning to across

family. customers, has large outstanding Earlier and the to commitment This supports propulsion. outboards internal been recently, of electric of Mercury electric with met an shipped industry launched leader award-winning products the in Avator to global Avator customers. our being product, first this first reception family products, the group both and of X.Xe a we combustion year, from the outboard And electric electric

the recently strong launched key engines during outboard a shows have Mercury VXX the seen had in very quarter The presence and boat demand. strong

International at exciting Boat launched the Mercury Mercury the new QX. XXXR, more product Racing Miami in news also We the version engine, of the from Show. Expect exciting

in has weeks state-of-the-art initial ePower to Group Navico the the addition strong. HDS launched our launch Fathom the since and II fish Pro, its demand In Lowrance very system, been finder, new

We the Powered by and and of next-generation and Brunswick SLX Group Sea consumers. also Electronics, example XXX, Navico design and cross-divisional technology, new synergies our Ray with Ray with Sea debuted engines it's another DNA. Mercury benefiting customers great

for, the point. of its the success maintenance known an series is Building all-new design, its versatility delivers which intuitive Miami Bayliner award-winning and focus ease with of on participation M-Series unveiled boats, a the through International The at the Boat boat, affordable on on Element this price expanding boater is outstanding Show. MXX MXX

with to model continues announced, America we replicating Three presence Australia. recently direct Europe. north advance process waterways the in Club were Asia globally, Boat successful as providing recent locations region, access the Pacific North of into in its to of the the additional begin Freedom expansion expansion Sydney, and

Thank you remarks. for open prepared joining questions. for concludes line our That the We'll call. now the

[Operator Instructions] BNP Siew question of the proceed. with Paribas. line comes Please Our first from Xian

to Thanks start, it's off? what's take retail strength engine perspective? about on can powerboat much? it Hi, And questions. are that's in guys. the the how Maybe you engine the so talk going an Is inventory really to for that and why Or levels maybe from repower outperforming starting business there? retail the

some difference, retail. Certainly, the that Yes, of like, for are outboard if impact there you couple a you and thank of you retail question. Yes, them there. things between the of kind mentioned boat

channel, We have certainly, able service to dealer the been the channel. some aftermarket of

strong aftermarket lean channel. getting So And you as the boats also strong. demand was high more been have for multi particular. saw, more We're International, very engines. in we horsepower in -- that with has

product well. that the as you down difference the for sterndrive quarter. also So that is And part is of saw

latency products. that from we towards quarter are product in resolve and sterndrive major outboard a or in factors. a some don't is those of also So that, getting typically but month, mix There we're some the away some

the P&A, levels. starts And reorder. then Thanks. the pickup I April? up pick seeing kind how it Helpful. in just you start the you about season, Engine to sell and the March, stocking start guess see retailers they When then maybe retail sell-through usually can So maybe talked Okay. us in in works? any to remind through usage of maybe as are on And we to that? should you

Yes.

than more even a pattern what could. of some the seeing an of and are we inventory typically March, to the just supply stocking extent, So year in in with some build Normally, main they sell-through That's was But seasonal year did the stocking year before. retailers April. season. bit were the a last everything pickup follows ahead happened disruptions, last chain it

there phase have less with availability wholesale chain more -- the So of advanced and we now the more is disrupted. between really and supply the was a -- restocking product

it expect more We follow a of to pattern. seasonal

at demanded think the is still that new selling through are I thing for being and at strongly wholesale exciting retail. products us

So, product quickly its sell new demanded wholesale we Navico's at Lowrance very strongly at Pro to brand, at from retail brand, through and HDS saw, most and through be for retail. -- very very example, its is important sell which begins

So this is not a just -- it's phenomena. uniform completely not

get overall, is would rightsizing destocking good good inventories kind you or and occurring. wholesale sell-through. the can I And If that say you can get of the there, in product right orders of

ahead optimistic the we're So, season. of

the Yes. was actually thing our Dave, add business in the products that I And quarter. to only is up U.S. would that,

P&A the in of regularly, that even your annuity-based off-season. kind about sales quarter here the talked showed in so that we And reliable, pretty

Please next of Raymond Joe comes James. Altobello Our from question the with line proceed.

Good question trends. on thanks, guess I boat Hey, first guys. morning.

particularly obviously, see March. the trends. You the improved that, mentioned in as progressed, We industry quarter not in did significantly that

will? if So, what's dichotomy, you driving that

season. you -- these Hi, they're point bit I boats difficult pinpoint the it's very They're Joe. registry preparing doing dealers a a always things. particularly would this But are tell things, as the that as in busy. of for Yes, lot little -- at season, to

of we the coming course, bit a SSI month. through then complement of And in through yet. states also, registrations hockey So tend a to of a get doesn't full reporting have stick

we about reporting sure these our registrations. that are We're assume industry So, delays. obviously

earlier I strength, of renewed some end parts versus in the aluminum say, also would the some be may of and of year year. last the There

our states converge I marketing are impact for of strongly came reporting. the where things numbers a there promotions think some the through and and confidence in pretty that period, with these be trend. over excited There an our But us. normally, about may

guide. we of into timing have pull move maybe quarter helpful. question That's it. second puts think And did capitalized were what and looks or propulsion that inventory to Got how -- little impact a how much maybe about second bit is a takes much the on we And It XQ? variances expecting. below the profit? Any that forwards

about place Joe, good one. the a this a I'll take start. so variance about $X.XX issue. dime, on to Yes, It's that's capitalized

that So a QX in good guide in reverse will QX.

rest it, The of think, it. normal of a part that's seasonality. I is So just

for last year, business. I just and like up, a looking the Dave year, flat normal see right, in to our of the real sell more Still no on growth to rush real think going saw, strong pull-through P&A we restocking in last line, to EPS slightly on comparatively out, just top factors. line. with you're But sell otherwise, whereas earlier, there's said

with from of next question Our the proceed. Swartz Truist Securities. Please Mike comes line

morning. good guys, Hey,

on Just a question following up quick retail.

year to in it prior you first be that full your down more was for calls, high I changed you retail the kind than was the mentioned of outlook that industry. industry for year? particularly down in digits. Have quarter, for the Obviously, the think for had single view

really beginning full season quarter, for haven't go we're still. view but to into a we'll changed second in the the important, Good morning, things be lot more as we No, super understand more Obviously, we Mike. are going. is year. early -- how the March

pretty we're industry, so the far. resilience for pleased the I of actually consumer promotions. looking would clearly say They're the about just across

sense they're which is shopping isn't numbers. away behavior The there really -- around in in there's large But they're backing So more. just more a a bit normal.

moment. we that year the So should would really our there's the the that for modify at balance suggest of nothing expectations

the we've the products. about We're is products excitement. generating that right which very always have launched, We excited new we think

We in right place. promotions have the

events right in the have We place.

the in but early So perspective. real change no reason season, to our

as you were first quarter know, And comps the Mike, probably the toughest.

the we kind be we'd the year, three months right mean -- here in. than So, of go where as remainder I thought a better little maybe three quarters in throughout we're line, we of bit

the of sustainable just Okay. a then I you given think takes question going understand, second in over have quarter. I'm this margins, on is is a that the in Helpful. production XX% Thank guys the that horsepower just are and you, benefit is capitalized on? to quarter. Propulsion Obviously, puts high the guys. some And done coming time history, probably you in trying down the doing and well, then lower horsepower bit, first inventory a have

how benefits do much So I'm that from in that about maybe And wondering we the how forward? think going then just get first that quarter? you temporary

expanding on that secular pretty But It an Propulsion basis. kind the continued timing on now installed variances, for And benefits have you long and is margins of efficient although automated. were a would was history had capacity extremely say, line as a opportunity And I march newly there people strong a we overall, us. and is a have associated seen many our quarter. see, to very of some those would with

that a they So secular margins, can think I trends of, yes, supporting bit be lot the quarter. trend although I little very no, sustained. a we have propulsion strong good in were assisted are that But this is think, increased a that

proceed. comes the Citi. James Our Hardiman line with Please question of from next

Hey, good morning.

you between first the that, SSI The market much being than and for your benchmarks increases share rather point or reason ton we thought is quarter? down, I about call just quarter were you of in a difference do is your the clarification. the you're in as industry a number think it, number this the think share XX%, sort the that's retail, internal suggesting down just industry assuming year. more So asked tune that And wrong of your of gaining I first of for XX% don't

about based down digit any range flat we context on I sort to think of know and I And guidance whatever, your quarter? the in so should double what don't of low of your in first saw if differently sort the

select say we share I this hi, in year. James. Yeah, increases would segments some market assuming were

So good which I that We some with it is is differences in had Ray of particular, start increases that reason see. March, in mean Whaler Sea that possible we share share associated difference clearly year. a to very know nice is strong in it for is. had that strength if product very market saw in boat to show that and substantial some aluminum Market be unlikely results. to there. We full the the

the in think component retail and in about that period more major is that more captured probably early And fact be to the likely we're have season. the been of I the it's the industry a acceleration registrations of states in amount data which are reporting.

of it's of get that the time reporting. we until they period just there -- are between the month, So I And SSI a end the partial mean clearly, think -- I data. short identify don't there's

is looking are dots this retail lowered about the your you to it. a that cautiously year just sense. double-digit if of perspective outlooks same biggest best connect going face be this the right, here? the year pretty talked assume seems to That I headline Maybe makes I And are the for They're in on probably there along decrease different dealer morning. how vein, dealers year. connect what talking a Got connect. from guess then, guidance optimistic. disparate to I do on your how comps. about, quarter be the than the fourth two quarter would and we're based things, the just we the calendar know But is Obviously, their dots that fiscal retail

Yes.

which couple a we does know not are is -- But not say the well which brands which of selling Ray think good well. I had about selling sales I are to MarineMax don't of we and things specifically -- ones portfolio. not brands think our of a they of a portfolio, year. then and MarineMax the Sea are for overlaps MarineMax channel our Whaler the partner. our portion through had both And but start all to strong

we And of there. so brands. couple of just on It's -- there's a difference our a really source potential overlap

view exactly probably to view their our brands the difficult are it's back world world. at would But ahead of premium So with moment. that I our say the performing compare of the market the of

Research. Our Fred proceed. with line Wightman the from next question comes Wolfe Please of

Hey, that XX% get follow we're story. for numbers to a and at I the the disconnect up from but what versus guys. to internal low data down kind different March look just seeing of wanted specifically, up on XQ, I if mean, I we registration is SSI. between mid-single it digits

was March? -- there seems like and It into data Like get retail some in specific the getting side. of just did anything signals mixed March April? we're on kind that things is year So in per better

Yes. reporting mixed fact we're our on the some I with the there obviously, retail agree industry. side. obviously retail. report signals And only we of partial can is getting And that the

the Our through retail quarter. first improved has sequentially

that, sure the entirely month again, source not later quarter. disconnect to I once what and the the of is. retail in in the late say So would in But somewhat tend registrations come

can rapid through become That's moment. delay and the quarter second the we in is extremely the reporting into is partial more as March of in This the at may in sales We're capture things would quarter likely a say reporting April. just it retail, they of you into when or point the of period stabilize. acceleration Things best will go we So inflection end about go moment. clearer the as I there if at not. a quarter and

the take, a we're the a just percentages we units, of season. hundred on early because where mean, are here, of talking a couple I Fred, right, reminder, of various brand, give or part in And

XX% So only the a over of numbers, half especially to it the a so saves. is SSI or little reporting bit lot when doesn't take move

Yes.

inflection were But to throughout into you sort That's Okay. Dave, that just trend continued guess what you the summarize, I saw fair. saying, the of quarter, that April? has

-- would Yes, I I a seeing encouraged. of Once think again, better out get continue solid be we to that But April through good we'll month. say trend. full after the we're view we we're get a

down? worked about comments you on Was Okay. exactly And March. mean comment some some it guys consumer about a made Navico inventories of the Was improving then, fair. there? That's getting a just also did you that comment takeaway? What in

month the Well, Navico's for margin Yes. XX%. was about op

from Obviously, through consistent the As we year. the -- which I from mainly and moment. full actually of felt months affected the actually, would restructuring to things at the of couple will only year low -- kind in coming March We mid-teens, effect the quarter. lot a in the that a And we be are went subsequent last more versus the full part took quarters. Navico which of of -- early mid-teens, was actions March is with trends say

we we up where for had that just product And the than happened then, we replacing ramp-up -- margin but higher-margin slower a lower ended which situation we us, product big had in than is a we product launched was with a it Pro, it's with out And were HDS when a discounting expected. the -- slower we we're no a discounts, anticipated.

that by replaced should product that that market essentially, a now a in to QX. through impact with expect we're launch in have lower complete, So is been we'd full flow margin product. higher-margin And the

Eric a Our proceed. line Please investor. of from next the private Wold, question comes

would be still Riley Hey, Securities.

Just a heads-up.

on be So, towards on of capacity kind products two propulsion to follow-up the can questions. us of guess maybe one year? update complete, where times higher-end kind now want the you the with manufacturing are on the of lead end versus you just being where I you expansion ultimately

Yes.

that internally now have are flow with quarter, of shape constraints I base and we the would a shaken remaining the to the feel think really also gone continuing as of we've with. good of really in by now the into in supported product. supply kind supplier to we've We operations terms both well kind good few off deal of

feel supply to through is clearly good. and fully that working into existing making We're already prepare on take seen more that to customers, OEMs, and transition and So, will be year. beginning sure we we our occurring we new OEM to as model go the begin we're

those I horsepower high engines. progress be shape improving aftermarket to take customers we we'll of And good good yes, get think supply and channels. continue So particularly additional into in the to QX with delivery, OEM on as really

kind Perfect. about you sell the talked retail like about patterns you to follow-up the are restocking of of P&A guess from kind boats? on And any kind more through? replacements? then, retailer on down selling Engine on you indicate talked of to maybe that through and -- basis, drill waiting data have I and longer, bit maintenance seeing the this products inventory kind of segment. aside more kind maybe improving returning of much is seeing anything if boats on you shift that what Is you nice down people kind you real-time I'm kind are of upgrade March people sure but a maybe products of Or and in a of April, adding of tell into replacement that not holding drill kind a are to on deep little purchases in

Yes. of the are QX And our actually Ryan last we that of this are products. kind earlier, on type side, as year the year. you Engine versus fix slightly product in of or maintenance were mentioned mentioned QX P&A essential Well, the on those products up that brake more sales

fact the banner year, area, particular, great given that clearly, area. that and a comped last in first year that that So in in well of the was quarter really quarter it's we last

We've on product want say longer, extent, don't willingness restock continue they on it. people category. to We to products extremely to technology-related a bit kind are a of electronics to some hold year's definitely last before strong. depends, But be that really willing said the that but the boat

when pull-through So the were Pro really from strong. HDS The we extremely was we pleased. Lowrance, launched

it's product, a right to as season. If go now, the get superior going pulled into you have through we especially

boats a But that engine high Mercury seven it Bassmaster finishers, Lund powered Gustafson, why one But on because saltwater and Pro the electronics. about of shows our a is relevant? won back, top XX with Mercury the of Lund year, with Lowrance really this had by with Pro, the correlates Pro talk horsepower. who's a anglers, and -- and well nine Jeff were Mercury We a lot top

events, like on of electronics lot Super Bowl thousands a those of at at of that and those of kind pull-through. Mercury the will Lowrance attention, engines freshwater events of people traction of they boats, events So, are there those attending fishing, the lot and and are they looking get the tens looking but a attract

of really pull-through. we're So, is excited very getting that we're about it technology to a kind and strong the bringing market,

I will seeing, through. fix So being pull technology as mentioned And think, course, we're you of parts kind through. to of continue pulled is earlier, break consumables and get

question Scott next the Please comes Our line Stember from Partners. MKM proceed. with of

my and taking questions. for morning, Good thanks

welcome. You're

you could I improving March said the was Going first about talk you it the April, and but quarter? P&A, back POS? to up in know it Engine was in

and not But that Yes, Scott, necessary wherever tell are we we that slightly don't patterns down whether honest. know from or our or we flat enough answer, up. of of technically We get information accuracy of wholesale bits can have up but partners, kind were picking for the pieces to certain wholesale the to you'd from ordering channel be orders be.

been we infer steady. that we can So -- know and that solid. retail has been It's

So hand-in-hand. we of and wholesale channel clearing once and up kind can be infer is the again, that retail will,

been But -- lot that point we well the say a one -- lot year. and attended yeah. one biggest events this but they in extremely generated of at partners have a of only data. And holds have we pull-through, thing is can We can partial our of

very of up as of But then, cycle trade had coming three-plus you years, the a a just Can boat either talk what And this actually boat? And deciding longer. renting retention are you've or seeing it. little Got as we've and that how that gone to narrative? growth know rates pandemic. Freedom about for you maybe bit is Freedom, buy looking helping at out nice I are through people far a a

lot and strong, business very, kind change continue question. a to for retention franchise very They rates. when -- good of subscription a Freedom strong particularly like that's Yes, this. There's -- at in interestingly, interest no -- be extremely of are looking as potential interest pricing. not rates of looking at when a Freedom members there's higher, increased members level or They're inflation inhibitor. same rates a are prospective around, the not

XX% think a XX%, option. becomes quarter about Freedom I comparatively think, up So, we more quarter-over-quarter, X,XXX And have even Remember XX%, members. net XX%. grown, versus attractive is I the

not potentially the I be and also from lack impact that And yes, strong. the membership. relative So to think pricing benefiting presents, Freedom of continues only rates on Freedom growth proposition of interest but

Capital Our comes line next proceed. of from Please question with Johnson Markets. Gerrick the BMO

you. Thank morning. Good Great.

Propulsion the -- end low Boat So, of margin of you're your repurchase. low end Ryan, share guidance, revenue you're increasing increasing upsizing guidance, the

come does guidance the So bottom not how can up? end your of consolidated

or in still Listen, question, you. you retail -- season the the us surprised XX% coming are We I'm very It's from know good a so And That's Gerrick. we -- early year. not of well. have you left. and

where We dealing marketplace have with. environment we're that uncertain an macroeconomic

So where can range are we we hit in ends simply that the both play. believe the of scenarios

didn't of to of optimistic I think when but year a first come. to we're much guidance so quarter, left sense good given lot little probably a the it more whole not the bit -- make we have the change

side? for you, think come. first. the show, last Dave. I would was a didn't at I how supplier about impressed Navico a had engines, XX. can James you content about Fathom would dual like of touch there? per Can the addition boat ask screen, And that your at -- any I you And Beach that softball Palm metrics Calypso Okay. figured When question Chris-Craft from Dave the it e-Power. Mercury I talking looked start share was

question, for Yes, a good Gerrick. you Thank asking it. that's

think our already is said I the of Brunswick we've XX% bill that of and And the now boats, about we in company. inside material of the brands products have supplied leading brands. own some from

penetration, cannot set foundation deliver Mercury, costs. of really of for our them. things solutions, important to how of ability And a is lot developing to terms muscles parties. a market really fantastic they ways. in But of replicate the providers that with can to do we're our relationships because We for very engineering system do their of of for a lot portions that. is So builders, especially in building its that solutions and expectations in as other they're integrated conscious them doing third

that like do to Chris-Craft are So growing it. -- customers yes, much so the it, more you independent to is of I now. more customers the great us those others see trusting And ours what's do think do who

a we're Nobody other for like else partner Fathom doing more respect. expect to great that integrated. more e-Power has than things and similar we're it do fully So customer in the system, because anything

engineering will think, going I propositions, outside that you us in well. as solutions to those and saw it continue doing would that Marine, to can it you'll the but unique more some see and Chris-Craft, more And of a make it lot more of kind have you we are attractive. industry RV see as see recovers, I So say that in too.

comes Baird. Please next the with proceed. Our question from Craig Kennison line

for back a your But it the goal P&A appreciate it. Analyst Day. one thanks one. And your not hopefully question. I of slides, you to is had goes XXXX my tough taking Hi, This XXXX. in

business P&A your have I don't billion was know Slide acquisitions. $X.XX achieve, the you to revenue, but deck, XXX. I For think, in excluding it

what that and just drivers a P&A whatnot, as that if the billion give business split try key attainable? between goal? are I'm We've think if achieve times. you a question restatement $X.XX And with the Engine had still can us few your maybe Just that is you Navico to wondering goal you and

P&A another we in our at third trying be in quarter Day. those portfolio, we're to more that There there's of you of increase think questions a still Obviously, is factors answer We've Yes. a we'll the And the point Craig. factors. confluence the Investor weather-related phenomena good It's -- have if a season. across experience -- got of There's strong real detail Thank obviously, time. in you, question. look this versus early moment. XXXX. that restocking at really the I of experiencing lot in kind But

between a time those XXXX to So of there to get is targets. lot and kind now of

any I specifics? more know you Ryan, if have don't

basically the couple the top-line. are terms mean, a now segments, give in hundred million new they take in mean, or of two same I I of size,

there, kind would think steady they the to more kind CAGR, growth. has revenue digits you bit always technology, to anticipate of is, and been business the just be I that But more RV. business margin channels, low- faster the that like long-term more is annuity based. recurring CAGR mid-single and Engine drive very P&A a of be growth Navico target continues said a grower. the to of That's including of

Engine faster, I very So to but targets the continue you table. is taking don't steady, think growing can be Navico a envision those off anyone P&A little

lot. Thanks Okay. a

question-and-answer This back concludes session. Dave, the you. to

Thank Thank you us. your for for Thank much, joining you you questions. very indeed.

seen, quarter, despite As extremely and revenue we strong delivered very environment, have record any the dynamic you EPS for first another quarter.

in you of the QX year. of through We're at the of parts rest to and also all I control, are cost strict think those maintaining target of completed investments have represent market having Freedom boats, Boat been the in of our recent moment. the that And market, strengths market resilient particularly the already on right actions the brands at premium and Navico matters, products will flow also in And the have in most Club. seen the the which strongest the technology high-horsepower capacity restructuring in and moment. engines, the XXXX Group, the

company. As year, nothing guidance, question, the the becomes the very guidance year. to because company entirely range. as the we to just the guidance for was changed path We in build prospects Ryan likely we less But earlier environment, but clearly, adjust And just possible the early relative of appropriate understanding our has And what's excited the in the through dynamic. so the upper which it for unusually half window of said more we go the continue lower the and have likely. of the clear year about is didn't upper to really, think to of be becomes half our maintained that we external large and end a

large a some us can and from in QX. are, product-based you new the expect in very We products a company, to end, extent, exciting

please that. forward So, to look

for Bye for appreciate Thank you it I again very joining us. much. now.

conference. concludes today's This

participation. time. You you this may lines Thank your disconnect at for your