OneWater Marine Inc. Q2 FY2025 earnings call

• Same-store sales declined 2% for the quarter, driven by softer sales on the West Coast of Florida recovering from hurricanes. - Industry unit sales were down in excess of 10% for the quarter, but OneWater outperformed and took market share. - Inventory reduced by 12% year-over-year and 5% sequentially. - Gross margins challenged due to industry promotional environment. - Cost savings initiatives underway, but offset by higher boat show and fixed costs. - Operational progress: web traffic up year-over-year, average unit price of new boats increased, pre-owned sales strong with higher volumes from trade-ins/trade-ups, financing and insurance revenue strength, parts and service revenue up 2%. - Inventory rationalization efforts with brands added to the plan, expecting to end year with 10%-15% inventory reduction.

Fiscal second quarter revenue decreased 1% to $484 million in 2025 from $488 million in 2024. New boat sales were down 5% to $310 million, while pre-owned boat sales increased 14% to $90 million. Revenue from service, parts & other sales for the quarter increased 2% to $69 million. Overall, same-store sales were down 2%, driven by a decrease in new boat sales.

• Revised fiscal 2025 guidance: total sales in range $1.7 billion to $1.8 billion, same-store sales flat to down low single-digits against industry expected down 10%-15%, adjusted EBITDA in range $65 million to $95 million, adjusted earnings per diluted share in range $0.75 to $1.25. This accounts for tariff and cost impacts.

• Macro-economic uncertainty. - Tariff landscape impact on demand. - Inflationary pressures on fixed costs. - Inventory challenges with outdated models being highly competitive.

Q: Joe Altobello from Raymond James asks about April demand post tariff announcements.

A: Austin Singleton says April was in line with last year, units and dollars up, May beginning ahead of last year, focus on making money as inventory corrects.

Q: Joe Altobello follows up on softer used margins.

A: Austin Singleton mentions model mix between pre-owned, brokerage, consignment, and being aggressive with more trades.

Q: Mike Albanese from Benchmark asks about share gains and promotional environment.

A: Austin Singleton says it's strategic, non-currents (’24s and older) highly competitive, current year models have decent margin as inventory cleans.

Q: Craig Kennison from Baird asks about industry shakeout and brands.

A: Austin Singleton talks about gap closing between brands due to shared suppliers, leading to potential consolidation or struggles for manufacturers/dealers, and details on exiting brands from 13 to 15, bullish on inventory position.