OneWater(ONEW)2025-01-30 20:42Financial Data and Key Metrics Changes - Revenue increased by 3% to 364 million in the prior year [17] - Same-store sales were up 4%, driven by an increase in new unit sales despite a 14% decline in industry unit sales [18] - Gross profit decreased by 8% to 91 million in the previous year [19] - Net loss for the first quarter totaled 0.81 per diluted share, compared to a net loss of 0.49 per diluted share in the prior year [21] - Adjusted loss per diluted share was 0.38 in the prior year [21] Business Line Data and Key Metrics Changes - New boat sales increased by 3% to 57 million [17] - Finance and Insurance revenue increased by 28% to 62 million [18] Market Data and Key Metrics Changes - Sales in the impacted areas due to Hurricane Helene and Milton were down mid-single digits compared to the prior year [8] - Overall inventory decreased by 10% year-over-year, with total inventory at 707 million a year prior [22] Company Strategy and Development Direction - The company is focused on executing its inventory strategy in preparation for the summer selling season while remaining nimble to respond to market changes [11] - The company aims to reduce leverage in the latter half of 2025 and is maintaining its fiscal 2025 guidance with total sales expected to be between 1.85 billion [24][23] - The company is actively looking for strategic acquisitions in key boating markets but is being cautious and selective [95] Management's Comments on Operating Environment and Future Outlook - Management remains cautiously optimistic about 2025 despite the industry facing uncertainty after a challenging 2024 [10] - The company has not seen significant market changes that would alter its outlook for the year [11] - Management highlighted the importance of cleaning up inventory to improve margins and operational efficiency [71] Other Important Information - Selling, general and administrative expenses decreased by 1% to $79 million, with SG&A as a percentage of sales down 90 basis points [19] - The company is experiencing a promotional environment with manufacturing partners to support sales initiatives [15] Q&A Session Summary Question: Can you discuss the cadence of the quarter and any month-to-month updates? - Management noted that October and November were strong, while December was flat due to seasonal factors [28][30] Question: What are the expectations for margins going forward, especially with exiting brands? - Management indicated that margins may continue to face pressure in the second quarter but could improve as exiting brands are phased out [36][34] Question: What is the current state of inventory and targets for the fiscal year? - The target is to reduce inventory by over 10% year-over-year by September 2025, with current inventory down 9% [50][51] Question: How is the pre-owned market performing? - The pre-owned market remains limited in inventory, with an increase in trade-ins noted [77][86] Question: What is the outlook for finance and insurance revenue? - Management emphasized ongoing efforts to increase finance and insurance penetration, which has been successful [92] Question: What is the status of the M&A pipeline? - The M&A pipeline is active, but the company is being cautious and selective in its approach [95][94]