Q1 2024 MasterCraft Boat Holdings Inc Earnings Call
Speaker 1: Good morning and thank you for standing by. Welcome to the fiscal first quarter, 2024, MasterCraft Boat Holdings earnings conference call.
Good morning, and thank you for standing by welcome to the fiscal first quarter 'twenty 'twenty four Master craft boat Holdings earnings Conference call.
Speaker 1: At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone, and then you will hear an automated message advising your hand is...
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Speaker 1: I would now like to hand the conference over to your first speaker today. Bobby Porter, vice president of strategy and investor relations. Please go ahead, Bobby.
I would now like to hand, the conference over to your first speaker today, Bobby Porter, Vice President of strategy and Investor Relations. Please go ahead Bobby.
Yeah.
Speaker 2: Thank you, operator, and welcome everyone. Thank you for joining us today as we discuss Matt Drakras' first quarter performance for fiscal 2024. As a reminder, today's call is being webcast live and will also be archived on a website for future listmen. With me on this morning's call, our Fred Brideville, Chief Executive Officer and Chairman, and Tim Oxley, Chief Financial Officer.
Thank you operator and welcome everyone. Thank you for joining us today as we discuss master Crafts first quarter performance for fiscal 2024. As a reminder, today's call is being webcast live and will also be archived on our website for future listening with me on this morning's call are Fred Brightbill, Chief Executive Officer, and Chairman and Tim Oxley.
<unk> financial officer.
Speaker 2: Fred will begin with a review of our operational highlights from the first quarter. Ken will then discuss our financial performance for the quarter. Then Fred will provide some closing remarks before we open the call for Q&A.
Brad will begin with a review of our operational highlights from the first quarter and will then discuss our financial performance for the quarter.
And then Fred will provide some closing remarks before we open the call for Q&A.
Speaker 2: Before we begin, we would like to remind participants that the information contained in this call is current only as up today, November 8, 2023. The company assumes no obligation to update any statements, including forward-looking statements.
Before we begin we would like to remind participants that the information contained in this call is current only as of today November eight 2023.
The company assumes no obligation to update any statements, including forward looking statements.
Speaker 2: Statements that are not historical facts are forward looking statements and subject to the safe harbor disclaimer in today's press release.
Payments that are not historical facts are forward looking statements and subject to the safe Harbor disclaimer in todays press release. Additionally.
Speaker 2: Additionally, on this conference call, we will discuss non- GAAP measures that include or exclude special or items not indicative of our ongoing operation.
Additionally, on this conference call, we will discuss non-GAAP measures that include or exclude special or items not indicative of our ongoing operations.
Speaker 2: For each non-gap measure, we also provide the most directly comparable gap measure into today's press release.
For each non-GAAP measure we also provide the most directly comparable GAAP measure in today's press release.
Speaker 2: which includes a reconciliation of these non-gab measures to our gap results.
Which includes a reconciliation of these non-GAAP measures to our GAAP results.
Speaker 2: There is also a slide deck summarizing our financial results in the investor section of our website.
There is also a slide deck summarizing our financial results in the investors section of our website.
Speaker 2: As a reminder, unless otherwise noted, the following commentary is made on a continuing operations basis. With that, I will turn.
As a reminder, unless otherwise noted the following commentary is made on a continuing operations basis.
With that I will turn the call over to Fred.
Speaker 3: Thank you, Bobby, and good morning, everyone. Our business performed well during the first quarter as we delivered better than expected results despite continuing macroeconomic and demand uncertain.
Thank you Bobby and good morning, everyone. Our business performed well during the first quarter as we delivered better than expected results, despite continuing macroeconomic and demand uncertainty.
Speaker 3: With the summer selling season now complete, they're focused on rebalancing dealer inventory with anticipated retail demand to ensure the health of our dealer network.
With the summer selling season now complete we are focused on rebalancing dealer inventories with anticipated retail demand and ensure the health of our dealer network.
Speaker 3: We are maintaining a disciplined approach to capital allocation as we prioritize balance sheet resilience and the return of cash to shareholders through our share repurchase program.
We are maintaining a disciplined approach to capital allocation as we prioritize balance sheet resilience and the return of cash to shareholders through our share repurchase program.
Speaker 3: macroeconomic factors, including interest rates, which could remain elevated for some time, are adversely impacting the demand for recreational boats and other luxury consumer goods.
Macroeconomic factors, including interest rates, which could remain elevated for some time are adversely impacting the demand for recreational boats another luxury consumer goods.
Speaker 3: The potential for a broader economic downturn during fiscal 2024 could worsen this headwind for the industry.
Potential for a broader economic downturn during fiscal 2024 could worsen this headwind for the industry.
Speaker 3: In addition, political and geopolitical risks are creating uncertainties that weigh on consumer confidence.
Additional political and geopolitical risks are creating uncertainties weighed on consumer confidence.
Speaker 3: Given the dynamic macroeconomic and geopolitical backdrop, which is limiting retail demand visibility, we are prepared to respond to a range of potential retail advance scenarios.
Given this dynamic macroeconomic and geopolitical backdrop, which is limiting retail demand visibility we are prepared to respond to a range of potential retail demand scenarios.
Speaker 3: Our dealer inventory levels decline modestly during the quarter. Dealers are cautious to add inventory as they focus on destocking prior year models ahead of the 2024 boat show and summer spelling season.
Our dealer inventory levels declined modestly during the quarter.
Alerts are cautious to add inventory is a focus on destocking. Prior year models ahead of the 2020 for boat show and summer selling seasons.
Speaker 3: Because of the uncertainty and the impact of elevated interest rates on consumer demand and floor plan financing costs, this discipline approach to immatory management will benefit the long-term health of our dealer partners and our business.
Because of the uncertainty and the impact of elevated interest rates on consumer demand and floor plan financing costs. This disciplined approach to inventory management will benefit the long term health of our dealer partners and our business.
Speaker 3: Al-Dila Rimentaries are currently higher than we consider optimal. We expect levels to improve by the end of the fiscal year.
Our dealer inventories are currently higher than we consider optimal we expect levels to improve by the end of the fiscal year.
Speaker 3: Moving on to splicing, we do not expect inventory availability to be a constraint on our fiscal year 2020 for production.
Moving on to supply chain, we do not expect inventory availability to be a constraint on our fiscal year 2024 production.
Speaker 3: Our experience supply chain team work diligently with supplier partners to alleviate constraints and support production and our now focused on cost reduction.
Our experienced supply chain team worked diligently with supplier partners to alleviate constraints and support production and are now focused on cost reduction.
Speaker 3: Given the uncertain environment, our strong balance sheet is a significant advantage which provides us with abundant financial flexibility.
Given the uncertain environment, our strong balance sheet is a significant advantage with provides us with abundant financial flexibility.
Speaker 3: Despite the sickle headwinds facing the industry, we are well positioned to pursue our capital allocation priorities, including investment in long-term growth.
Despite the cyclical headwinds facing the industry, we are well positioned to pursue our capital allocation priorities, including investment in long term growth.
Speaker 3: We continue to prudently invest in targeted initiatives that will take advantage of the industry's positive underlying secular trends.
We continue to prudently invest in targeted initiatives that will take advantage of the industry's positive underlying secular trends.
Speaker 3: These investments will support long-term growth and value creation through product-line expansion, relentless innovation, and an unyielding focus on the consumer.
These investments will support long term growth and value creation through product line expansion relentless innovation and an unyielding focus on the consumer.
Speaker 3: With our financial position secure and our current strategic growth initiatives fully funded, we expect to continue to allocate most of our free cash flow for the year to our EPS of Creative Share Repurchase Program.
With our financial position secure and our current strategic growth initiatives fully funded we expect to continue to allocate most of our free cash flow for the year to our EPS accretive share repurchase program.
Speaker 3: We recently published our second annual Sustainability Report, which highlighted our progress on promoting social and environmental responsibility.
We recently published our second annual sustainability report, which highlighted our progress in promoting social and environmental responsibility.
Speaker 3: During fiscal 2023, we expanded our waste recycling program by nearly doubling the amount of reported waste recyclable were reused. The matchcraft grants were passed 4 million hours without a lost time incident. And we implemented employee engagement initiatives to reinforce our commitment to human capital.
During fiscal 2023, we expanded our waste recycling program by nearly doubling the amount of reported waste recycled or reused.
Craft brands surpassed 4 million hours without lost time incident.
Implemented employee engagement initiatives to reinforce our commitment to human cap.
Speaker 3: Our company's success is due to the dedication of our employees and the loyalty of our customers. And we know we must continue to deliver superior value to ensure our long-term success.
Our company's success is due to the dedication of our employees and the loyalty of our customers and we know we must continue to deliver superior value to ensure our long term success.
Speaker 3: We look forward to making voting better and maintaining our company's position at the forefront of the green industry.
Look forward to making boating, better and maintaining our company's positioned at the forefront of the marine industry.
Speaker 3: In addition, we recently partnered with St. Jude Children's Research Hospital on the Surf to Safe Lives Campaign. Our goal through this partnership is to make meaningful difference in the lives of families across the country.
In addition, we recently partnered with St. Jude Children's Research hospital on the surface to safe lives campaign. Our goal through this partnership is to make meaningful difference in the lives of families across the country.
Speaker 3: We're proud to announce that the campaign was very successful and in addition to individual employee contributions, the company donated $75,000 to St. Jude.
We are proud to announce that campaign was very successful and in addition to individual employee contributions the company donated $75000 to St. Jude.
Speaker 3: We look forward to continuing to support their mission to understand, treat, and defeat childhood cancer and other life-threatening diseases.
We look forward to continuing to support their mission to understand treat and defeat childhood cancer and other life threatening diseases.
Speaker 3: But we now briefly reviewed some of the latest developments across our brain.
Let me now briefly review some of the latest developments across our brands.
Speaker 3: Our mass graph brand, net sales were $75.8 million for the quarter, down 33% from the record at the profit price for the 130.8 million. I am not even interested. But I appeared in a documentary film.
But our maps scrap brand net sales were $75 8 million for the quarter down 33% from the record prior year period.
Speaker 3: The decrease in net sales was in line with our expectations, given the plan production decrease to rebalance dealer inventories to lower retail demand.
The decrease in net sales was in line with our expectations given the planned production decreased to rebalance dealer inventories to lower retail demand.
Speaker 3: MasterCraft recently announced the ICON package, an all-new package for our entry-level NXC series.
Master craft recently announced the icon package and all new package for our entry level NXT series the.
Speaker 3: The aggressive features of the icon package brought the NXT's consumer base by appealing to those seeking to make Boulder State.
The aggressive features of the icon package of broadening nxp's consumer base by appealing to those seeking to make bolder statement.
Speaker 3: Features include all Black Z6 tower, C-DEC flooring, along with exclusive underwater impact fit and tower mounted lighting.
Features include all Black Sea six tower C Tech flooring, along with exclusive underwater in cockpit and tower mounted lighting.
Speaker 3: The ICON package compliments master crafts extensive model year 2024 lineup, which includes the most models available for many brands in the ski way category.
Icahn package complements master crafts extensive model year 2024 lineup, which includes the most models available from any brand in the ski wake category.
Speaker 3: In addition, MasterCraft continues to set the pace by offering the most wave adjustability, exceptional handcrafted quality, and unmatched pump.
In addition, master craft continues to set the pace by offering the most wave adjustability exceptional handcrafted quality and unmatched comfort.
Speaker 3: At crest, net sales were $18.5 million for the quarter, down 58% from the prior year period, as it's...
At crest net sales were $18 5 million for the quarter down 58% from the prior year period as expected.
Speaker 3: Elevated interest rates have severely impacted the pontoon category in the near term. Although we remain optimistic about the long-term secular growth trend.
Elevated interest rates and severely impacted the pontoon category in the near term, although we remain optimistic about the long term secular growth trends.
Speaker 3: Press will soon be announcing an all-new line of products to expand its addressable market. We look forward to providing more information on this exciting initiative later this year.
<unk> will soon be announcing an all new line of products to expand its addressable market.
Look forward to providing more information on this exciting initiative later this year.
Speaker 3: At Aviera, net sales were $9.9 million for the quarter. Down 23% compared to the prior year period. During the quarter, Aviera was focused on the introduction of the all-new AV-28, which has been incredibly well received by our dealer partners.
<unk> net sales were $9 9 million for the quarter down 23% compared to the prior year period.
During the quarter <unk> was focused on the introduction of the all new <unk> 28, which has been incredibly well received by our dealer partners.
Speaker 3: More than just a single model, the 8028 platform consists of four distinct model variants, an impressive surferion, a stern drive, a twin outboard, and a single outboard.
More than just a single model. The AAV 28 platform consists of four distinct model variants and impressive surf Orient, our stern drive a twin outboard and the signal outboard.
Speaker 3: I've here began shipping this new model during the quarter and we expect the AV28 production to continue to ramp up for the remainder of the year.
<unk> began shipping this new model during the quarter and we expect the 28 production to continue to ramp up for the remainder of the year.
Speaker 3: Avere also extended its distribution network by adding five new domestic and international points of distribution during the court.
<unk> also expanded its distribution network by adding five new domestic and international points of distribution during the quarter.
Speaker 4: I would now turn the call over to Tim, who provide a more detailed discussion about financial results. Tim, thanks, Fred. Folks, thing on the top line, it fails for the quarter of $104.2 million, the decrease of 65.65.3 million, or 39% for the record prior year period. 50 increase was primarily due to lower unit volumes, increased eagerness in its partially asset by increased prices.
I will now turn the call over to Tim who will provide a more detailed discussion of our financial results. Tim Thanks, Brett focusing on top line net sales for the quarter were $104 $2 million decrease of 65.
$65 3 million or 39% from the record prior year period.
Kris was primarily due to lower unit volumes and increased dealer incentives, partially offset by increased prices.
Speaker 4: Deer incentives include higher or planned financing costs, as a result of increased deer inventory and interest rates, and other retail incentives do to the extremely competitive environment.
Dealer incentives include higher or planned financing cost as a result of increased dealer inventories and interest rates and as a retail incentives due to the extremely competitive environment.
Speaker 4: For the quarter, I gross margin with 21%. The decrease of 610 basis points, when compared to prior year period.
For the quarter, our gross margin was 21% a decrease of 610 basis points when compared to the prior year period.
Speaker 4: Lord Morrow's were mainly due to delirving on lower production volumes.
Lower margins were mainly due to deleveraging on lower production volumes.
Speaker 4: increased de-rent incentives and higher input costs. Firstly, I'll set by price increase.
Increased dealer incentives and higher input costs.
Offset by price increases.
Speaker 4: operating expenses were 13.3 million for the quarter down nearly 500,000 from prior year.
Operating expenses were $13 3 million for the quarter down nearly 500000 from the prior year.
Speaker 4: Turn to the bottom line, adjusted as income for here, decreased to $8.1 million or 47 cents per deleted share. Computed using a revised lower estimated annual effect effect rate of 22% due to continuing investments that yield R&D tax rates.
Turning to the bottom line adjusted net income for the year decreased to $8 1 million or <unk> 47 per diluted share computed using a revised lower estimated annual effective tax rate of 22% due to continuing investments that yield R&D tax credits.
Speaker 4: This compares to adjust the income of $25.7 million or $1.43 for the prior period. Computed using an tax rate of 23%.
This compares compares to adjusted net income of $25 $7 million or $1 43.
For the prior year period.
<unk> using a tax rate of 23%.
Speaker 4: Just a deba dada decreased to $12.2 million for the court compared to $35.9 million in the prior year period.
Adjusted EBITDA decreased to $12 2 million for the quarter compared to $35 9 million in the prior year period.
Speaker 4: HSC margin was 11.7 percent down 950 basis points from 21.2 percent in the prior year period.
Adjusted EBITDA margin was 11, 47% down 950 basis points from 21, 2% in the prior year period.
Speaker 4: Our balance sheet remains incredibly strong as we end the year with nearly $190 million of total liquidity, including $90 million of cash and short-term investments and $100 million of availability under our evolving credit facility.
Our balance sheet remains incredibly strong as we ended the year with nearly 190 million of total liquidity.
$90 million of cash and short term investments and 100 billion of availability under our revolving credit facility.
Speaker 4: into the court with no net debt as cash and short-term investments exceeded our outstanding debt balance.
We ended the quarter with no net debt as cash and short term investments exceeded our outstanding debt balance.
Speaker 4: our balance sheet positions exceptionally well and provides us with ample financial flexibility to ensure sound operations through the business cycle and the ability to fund strategic road conditions.
Our balance sheet positions us exceptionally well and provides us with ample financial flexibility to ensure sound operations throughout the business cycle and the ability to fund strategic growth initiatives.
Speaker 4: During the quarter, we spent nearly $6 million to repurchase 241,000 shares of our common stock.
During the quarter, we spent nearly $6 million to repurchase 241000 shares of our common stock.
Speaker 4: Since initiating our share repurchase program in June of 2021, we have spent nearly $54 million to repurchase nearly 2.1 million shares.
Initiating our share repurchase program is June of 2021, we have spanned nearly $54 million to repurchase nearly two 1 million shares.
Speaker 4: These cumulative repercussions have provided that 12% benefit to our fiscal first quarter just and that income per share.
These cumulative repurchases provide provided at 12% benefit to our fiscal first quarter adjusted net income per share.
Speaker 4: We expect to continue to return cash to shareholders while prioritizing financial flexibility and high return investments in a business that generate growth and long-term shareholder value.
We expect to continue to return cash to shareholders.
<unk> financial flexibility and high return investments in the business that generate growth and long term shareholder value.
Speaker 4: given the continued economic uncertainty, our outlook for full year fiscal 2024 remains unchanged. As a reminder, consolidated net sales is expected to be between $390 million and $420 million, with adjusted EBITDA between $42 million and $52 million.
Given the continued economic uncertainty our outlook for full year fiscal 2024 remains unchanged as a reminder, our consolidated net sales as expected.
To be between $390 million and $420 million with adjusted EBITDA between $42 million at $52 million and.
Speaker 4: and adjusted earnings per share between $1.46 per share and $1.88.
And adjusted earnings per share of between $1 46 per share and $1 88.
Speaker 4: We continue to expect capital expenditures, capital expenditures be approximately 22 million for the full year.
We continue to expect capital expenditures capital expenditures to be approximately $22 million with full year.
Speaker 4: For the second quarter of fiscal 2024, consolidate that sales is expected to be approximately $96 million with the just the $1, but approximately $7 million. And adjust during for shares of approximately 22 cents.
For the second quarter of fiscal 2020 for consolidated net sales is expected to be approximately $96 million with adjusted EBITDA of approximately $7 million and adjusted earnings per share of approximately <unk> 22.
Speaker 4: Although our guidance reflects the significant decline earnings for fiscal 2023, we expect to generate positive free cash flow, which is a testament to our flexible, highly variable cost rupture and proactive cost control efforts. I'll now turn the call back to Fred for his closing remarks.
Although our guidance reflects a significant decline in earnings for fiscal 2023.
Expect to generate positive free cash flow, which is a testament to our flexible highly variable cost structure and proactive cost control efforts I'll now turn the call back to Greg for his closing remarks.
Thank you Tim.
Speaker 3: As we focus on re-balance and dealer remitories, our business performed well during the first quarter by delivering better than expected results.
As we focus on rebalancing dealer inventories our business performed well during the first quarter by delivering better than expected results.
Speaker 3: A strong balance sheet provides us with a financial flexibility and affords us the opportunity to pursue our strategic growth initiatives. To continue to exercise a discipline capital allocation over the past 24 months we've returned more than $54 million of excess cash to our shareholders to our share repurchase program.
Our strong balance sheet provides us with the financial flexibility it affords us the opportunity to pursue our strategic growth initiatives. We continue to exercise a disciplined capital allocation over the past 24 months, we have returned more than $54 million of excess.
Excess cash to our shareholders through our share repurchase program.
Speaker 3: As we move beyond inventory, rebalancing, they are confident in our ability to leverage our portfolio of strong brands, deliver on our commitments, pursue long-term growth opportunities, and generate exceptional shareholder returns. Operator, you may not.
As we move beyond inventory rebalancing, we are confident in our ability to leverage our portfolio of strong brands deliver on our commitments pursue long term growth opportunities and generate exceptional shareholder returns.
Operator, you May now open the line for questions.
Speaker 1: At this time, we will conduct a question and answer session.
Thank you at this time, we will conduct a question and answer session.
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As a reminder to ask a question you will need to press star one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
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Speaker 1: Please stand by while we compile the Q&A.
Please standby, while we compile the Q&A roster.
Speaker 1: Our first question comes from the line of Joe Altabello from Raymond James. Your line is now open.
Our first question comes from the line of.
Joe I'll Cabello from Raymond James Your line is now open.
Speaker 5: thanks hey guys good morning um i guess first question on the other motories you mentioned that they're you know they're they're above optimal at this point if you could quantify that for us um you know what is inventory stand in terms of weeks on hand today
Thanks, Hey, guys good morning.
I guess first question on dealer inventories.
That there.
They're above optimal at this point, if you could quantify that for us.
Where does the inventory stand in terms of weeks on hand today versus where you might've been in 2019 and are there any particular brands that are well above your target at this point.
Speaker 5: And are there any particular brands that are well above your cards?
Speaker 3: Joe, the inventory is marginally different. And I would say the heavy cemetery is in the pontoon category, which was the most severely impacted from a demand standpoint.
Joe.
The inventories marginally.
Different.
And then.
I would say.
The heavy inventory is in the pontoon category, which was the most severely impacted from a demand standpoint.
Speaker 3: But once again, given the programs we have in place.
Tom.
But once again.
Given the programs we have in place.
Speaker 3: and our expectation to work that down over the remainder of the year. We feel reasonably comfortable. It's not where we'd like to be ideally, but you know, it's far from a crisis situation. It's just something that we need to manage our way through as we have in previous cycles.
And our expectation to work that down over the remainder of the year.
We feel reasonably comfortable.
It's not where we'd like to be ideally, but.
Yes.
It's far from a crisis situation.
Just something that we need to manage our way through as we have in <unk>.
Speaker 4: Hey Joe, this is Tim. I'd like to add, we mentioned that we had showed a modest decrease in our...
Previous cycles.
Hey, Joe This is Tim I'd like to add we mentioned that we had showed a modest decrease in our.
Speaker 4: We were inventory coming from the end of the year. And that's a pretty rare occurrence. I look back at the pre-COVID years and only happened one time in the 12 years that I was looking at. So we're making some progress in the correction or de-work inventory. Hi, apologize.
Dealer inventory.
From the end of the year.
That's that's a pretty rare occurrence I look back at the pre Covid years only happened one time in the 12 years that I was looking at so we're making some progress in the correction our dealer inventory.
And I apologize if you mentioned this earlier and I missed it but in terms of timing.
Understanding that you expect to under ship demand throughout fiscal 'twenty four or into the spring.
Speaker 4: It may vary by quarter, but certainly, I think our easiest contort the fourth quarter. So we expect the inventory to be properly balanced by the end of our fiscal year.
It may vary by quarter, but certainly.
I think our easiest comp towards the fourth quarter. So we expect inventory to be properly balanced by the end of our fiscal year.
Speaker 4: It may not make progress. I mean, what happens in Q2 is so immaterial that we don't even pay that much attention to the percentages in Q2. Really, it comes down to as it does in most years. The start of the selling season, April through June . Okay.
Okay. It may not make progress.
What happens in Q2, it's so immaterial that we don't even.
Hey that much attention to the percentages in Q2 really comes down to as it does in most years.
To start with the selling season for April through June.
Okay. Thank you guys.
Thank you.
One moment for our next question.
Speaker 1: Our next question comes from the line of Craig Kennethon from Baird. Your line is now open.
Our next question comes from the line of Craig Kennison from Baird. Your line is now open.
Speaker 1: If your line is muted, I'll bury you. Sorry about that.
If you were to line okay.
Sorry about that.
Speaker 2: So this is Bobby, I'm Craig, if you're talking, we don't hear you.
So this is Bobby.
If you're talking we don't hear you.
Speaker 1: Please rejoin using the CALL ME feature and see if this will help. I'm going to go ahead and go to
Great. Please rejoin using the <unk> feature.
This will help I'm going to go ahead and go to <unk>.
Okay.
Okay.
One moment for that next question.
Speaker 1: Our next question comes from the line of Eric Wolne from B. Riley Securities. Your line is now open.
Our next question comes from the line of Eric Wold from B Riley Securities. Your line is now open.
Speaker 6: Thanks, good morning, everyone. A couple of questions. I guess, do you talk about the significantly higher average prices per boat you saw within the mass-trap segment both sequentially and your rear-guards? How much of that was the model your price increased?
Thanks, Good morning.
Hi, everyone. A couple of questions I guess can you talk about the significantly higher average prices per BOE you saw within the <unk> segment.
<unk> and year over year, I guess, how much of that was the model year price increases.
Speaker 6: for the starting year versus kind of voluntary upticks and kind of, you know, mix or features that and how sustainable do you think these prices are, the macro compare environment we're in?
For the start of the year versus kind of voluntary upticks in kind of mix or features.
And how sustainable do you think these prices are kind of in the macro compare environment. We're in.
Speaker 6: a desire to kind of, you know, those to moderate.
Any desire to kind of.
Going to moderate.
Speaker 4: Yeah, this is Tim, Eric. So what we're seeing is a little bit of a shift toward the XT and X part of our lineup, the interest rate increases are most impactful on our NXT's.
Yes.
This is Tim Eric So what we're seeing is a little bit of a shift toward the.
<unk> Nx part of our lineup the.
The interest rate increases are most impactful on our Nx phase.
Speaker 4: So those are voluntary. Our price increase was pretty moderate this year, less than 4% for mass craft. So we're entering into a period where we have, you know, the large price increases of the past are not going to be as cool and forward.
So those are voluntary our price increase was pretty moderate this year less than 4% for mass correct. So.
We're entering into a period, where we have yes.
The large price increases of the past are not correct.
To use going forward.
Got it okay.
Speaker 7: And then on the, on Aviyara, with the launch of the AB28 line, and on the production or shipment to your year, we're down, someone has a result of that. Is the AB28 disrupting or kind of displacing production of other models? Is it more just kind of a...
And then on the <unk>.
With the launch of the 828 line.
<unk> production or shipment year over year were down somewhat as a result of that is the between disrupting our kind of displacing production of other models is it more just kind of.
Speaker 6: focused and got disrupted a little bit in the quarter. And how long until you think quarterly production shipments kind of return to what we see in our past couple quarters, or had you actually seen any decline in demand for Alvierre either at the retailer with your dealer partners.
The focus kind of got disrupted a little bit in the quarter and how long until you think quarterly production shipments for a return to what we've seen over the past couple of quarters or have you actually seen.
Any any decline in demand.
For RBR either at retailer with.
Alright, your dealer partners.
Speaker 3: The transition to ramp up the 28 was definitely disruptive production. It requires relay out of the plant and a very different focus in terms of the cycle times of those products. So it's a significant impact in this first half of the year as we ramp it up. We really expect to hit our pace in the second half of the year in terms of the 28 production.
The.
<unk> to ramp up to 28 was definitely disruptive production. It requires re lay out of the plant.
Very different focus in terms of the cycle times of those products. So.
It's a significant impact in this first half of the year as we ramp it up we really expect to hit our pace in the second half of the year in terms of the 28 production.
Speaker 3: There's tremendous demand for that. It's been extremely well received.
Tremendous demand for that it's been extremely well received and we are.
Speaker 3: And, you know, we're phasing back the legacy products at this point in time to really get the 28 gone. So,
Were phasing back.
Legacy products at this point in time to really get the 28 going so.
Speaker 3: Yeah, that's the overall situation that I would expect to see in the near term and roll through the year. Couldn't be more optimistic about the demand for the 28. And it's just a matter of us really making sure that we ramp up carefully and do it well.
That's the overall situation that I would expect to see in the near term enrolling through the year Couldnt.
Couldnt be more optimistic about the demand for the 28.
And it's just a matter of US who are really making sure that.
We ramp up carefully and do it well.
Speaker 7: And a positive, if I made it a quick follow up on that, if there is
And I apologize if I may just a quick follow up on that.
There is.
Speaker 7: more of a shift towards the 28 versus the legacy product. What did that dude do? Average prices going forward.
More of a shift towards the 28 versus the legacy product what does that do to.
Average prices going forward.
Speaker 3: That absolutely will drive those ASPs down for Aviara.
Yes, absolutely it will drive those asps down for IV Euro.
Speaker 3: I talked more in the range of 100.
I'm talking more in the range of.
100 <unk>.
Speaker 3: I think something on the order of 170 to $8,000 ASP for 28.
I think something on the order of about 170 to 80.
<unk> thousand dollars ASP for 28.
Speaker 8: Yeah, Eric so for FY 24, we expect of the RISPs to be down mid single, sorry, mid 20% range for the year.
Yes, Eric so for FY.
FY 'twenty four we expect asps to be down mid single, sorry, mid 20% range for the year.
Got it.
Thank you guys I appreciate it.
Thank you.
One moment for our next question.
Speaker 1: Our next question comes from the line of Craig Kennisin from Baird. Your line is now open.
Our next question comes from the line of Craig Kennison from Baird. Your line is now open.
Greg you there.
Speaker 1: your line is needed. Go ahead, and it appears to be. Yeah, go ahead. Yeah, I was just going to say, um, this is a quick reminder, if your line is needed, please unmute it. But go ahead, Bobby.
Your line of luxury it appears Lee Yes go ahead, yes, I was just going to say just as a quick reminder, if your line is muted. Please <unk> go ahead Bobby.
Speaker 2: I was just going to say if Craig, if you're talking, we still can't hear each other.
No I was just going to say, Bob Craig if you're talking we still can't hear you.
Speaker 1: So sorry about that. I know you did rejoin using the call me feature. Management, how would you like me to proceed?
So sorry about that I know you then rejoin using the <unk> feature.
<unk>.
Management, how would you like me to proceed.
Let's queue up the next question if there are others.
Speaker 1: Okay, perfect. I am showing no more questions at this time. So if you all are ready, I'm ready to conclude today's conference.
Okay, perfect I am showing no more questions at this time.
So if you all are ready I'm ready to conclude todays conference.
Speaker 1: Perfect. So thank you for your participation in today's conference. This does conclude the program and you may now disconnect.
Yes. Thank you.
Perfect. So thank you for your participation in today's conference. This does conclude the program and you may now disconnect.
Okay.
Okay.
[music].
Okay.
Okay.
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