On this page of StockholderLetter.com we present the latest annual shareholder letter from MARINE PRODUCTS CORP — ticker symbol MPX. Reading current and past MPX letters to shareholders can bring important insights into the investment thesis.

 •  3/12/2025 Letter Continued (Full PDF)
 •  3/15/2023 MPX Stockholder Letter
 •  3/14/2024 MPX Stockholder Letter
 •  More "Consumer Goods" Category Stockholder Letters
 •  MPX Benford's Law Stock Score = 62

MPX Shareholder/Stockholder Letter Transcript:

2024
ANNUAL REPORT
STAYING THE COURSE

MARINE PRODUCTS CORPORATION
(NYSE: MPX) designs, manufactures and distributes premium-branded Chaparral
sterndrive and outboard pleasure boats and Robalo outboard sport    shing boats
through 202 domestic and 88 international independent dealers.
With premium brands, a solid capital
structure and a strong independent
dealer network, Marine Products is a
market leader that has consistently
generated strong    nancial
performance and paid dividends to
our stockholders.
Marine Products also seeks to utilize
its    nancial strength to capitalize
on opportunities that pro   tably
increase its market share and
broaden its product offerings within
the pleasure boat market. For more
information, visit our website at
MarineProductsCorp.com.
Featured on front cover: Chaparral 280 OSX
Featured on back cover: Robalo R300
Featured left: Robalo Center Console Explorer R222EX
For speci   c product information, please visit:
ChaparralBoats.com
Robalo.com
01 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2024 FINANCIAL HIGHLIGHTS
02 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . LETTER TO STOCKHOLDERS
04 . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPARRAL 2025 PRODUCT OVERVIEW
05 . . . . . . . . . . . . . . . . . . . . . . . . . . . . ROBALO 2025 PRODUCT OVERVIEW
06 . . . . . . . . . . . . . . . . . . . . . . . . . . . . CHAPARRAL CELEBRATING 60 YEARS
06 . . . . . . . . . . . . . . . . . . . . UNLEASH ADVENTURE WITH ROBALO   S 2025 R300
07 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2024 FORM 10-K
Inside Back Cover . . . . . . . . . . . . . . . . . . . . . . . . . . . CORPORATE INFORMATION

$ 380,995
$ 383,729
$ 236,555
$ 19,444
$ 29,026
$ 40,347
$ 41,695
$ 17,853
2021
2022
2023
2024
2020
2021
2022
2023
2024
2024
Average Selling Price Per Unit
2020
2021
2022
2023
2020
4,139
4,331
4,165
3,689
$ 86
$ 82
(IN THOUSANDS)
$ 77
Net Income
$ 62
Net Sales
(IN THOUSANDS)
2,492
$ 298,014
2020
$ 56
$ 239,825
2024 FINANCIAL HIGHLIGHTS
2024
Number of Boats Sold
2021
2022
2023
21,052
$ 0.57
2023
2024
2020
E BI T DA
(1)
(IN THOUSANDS)
(1) EBITDA is a financial measure that does not conform to
generally accepted accounting principles (GAAP). Additional
disclosures regarding this non-GAAP financial measure, including
a reconciliation of EBITDA to net income, are found in Item 7 of the
10K filing included in this 2024 Annual Report.
$ 0.50
51,618
2022
$ 1.21
53,701
2021
$ 1.18
38,208
2020
$ 0.85
26,315
(IN THOUSANDS)
2024
Diluted Earnings Per Share
2021
2022
2023
(AMOUNT IN DOLLARS)

LETTER TO STOCKHOLDERS
2024 marked a continuation of the demand challenges we saw
coming out of 2023. We responded with decisive cost-control
measures and stayed the course with respect to our operating
discipline and focus on high quality products. Facing soft dealer
demand, we right-sized our production levels and focused on cash
   ow. We were pleased with the cash generation of the business
and to have    nished the year with a highly liquid, debt-free
balance sheet, even after returning a signi   cant amount of capital
to our investors. This included a large special cash dividend midyear. Simply put, our constant efforts in new product development
and manufacturing efficiencies, investments in our dealer network
and conservative    nancial stewardship remain unchanged
regardless of the external factors we face.
For approximately 18 months, domestic boat manufacturers have
been dealing with reduced order    ow from dealers across the
country as they have worked to reduce excess inventories. For
context, during and shortly following the pandemic, boat demand
surged and often could not be fully met due to supply chain
constraints. As those issues were resolved, demand strength
continued into mid-2023 before waning. The boat industry
grappled with rapidly escalating interest rates, which substantially
increased dealer costs of holding inventory and    nancing costs
for consumers looking to secure loans for their purchases. This,
coupled with economic and political uncertainties, weighed on endmarket demand. Concurrently, dealers were holding high levels of
inventory, and with demand softening, they sought to sharply reduce
their inventory exposure and pared back their orders of new boats.
2870 SSX
Thus while 2023 saw the initial impacts of these trends, 2024 bore
the full brunt of this broad channel de-stocking, which was clear in
our sales and pro   t trends for the year. We are pleased to say that
despite a challenging backdrop, we remained solidly pro   table,
made great progress on reducing dealer inventory, and are
cautiously optimistic that the worst is behind us.
We were certainly frustrated with industry headwinds. However,
we took this period of reduced dealer demand to focus on things
within our control and position us to better capitalize on improved
demand when it materializes. With scaled back production
schedules to facilitate downstream inventory reductions, we spent
the year examining our operations. We found opportunities to
improve processes and make our manufacturing more efficient, all
while continuing to introduce new models, colors and features to
maintain the high standards expected from our leading brands.
2
Facing soft dealer demand, we right-sized
our production levels and focused on cash flow.
We were pleased with the cash generation
of the business and to have finished the year
with a highly liquid, debt-free balance sheet...
We also invested in our assets, including a large solar panel
installation project at our Nashville, Georgia facilities.
Our brands continue to be some of the best performing in the
industry. During 2024, within its categories and size range,
Chaparral   s retail market share ranked number one. During this
same time, Robalo held the fourth highest retail market share in
its size range. We are proud of these accomplishments and the
consistency of the strong market share results within our product
lines in recent years. Another consistent accomplishment relates to
the recent announcement that both Chaparral and Robalo won the
CSI Award for customer satisfaction for the 18th consecutive year.
FINANCIAL OVERVIEW Net sales decreased 38% in 2024 to
$236.6 million. Unit sales decreased 40%, with a positive price/
mix impact of 2% offering a partial offset. The lower unit volumes
were a function of the signi   cant channel de-stocking, with dealers
clearing inventory but hesitant to place stronger re-orders until
they felt more comfortable with consumer demand. Sales were
down year-over-year in each quarter, but each quarter   s declines
became slightly less pronounced as 2024 progressed. As we begin
2025, it is possible we see    at sales performance versus the prior
year in the    rst half, with the potential for growth in the second half
of the year. The positive price/mix was a function of price increases
to cover higher costs and shift to larger, higher-priced boats. Our
best-selling models in 2024 continued to be two of our 21- and
23-foot Chaparral sterndrive sport boats, together representing
about 16% of our total units sold.
Gross pro   t in 2024 was $45.5 million, down from $90.4 million
last year, largely due to lower production volume and associated
manufacturing inefficiencies. Gross margin was 19.2% of net sales
in 2024, compared with 23.6% in 2023. We adjusted our variable
labor costs and production schedules to re   ect soft consumer
demand and align with order indications from our dealers. Gross
margin was also impacted by a full year of promotional program
costs, whereas in 2023 we only reinstituted those programs late in
the year (such programs were not in effect during the period of high
post-pandemic demand).
Selling, general and administrative expenses decreased to $27.4
million in 2024, down from $43.2 million last year. The decrease
was largely in line with the sales decline as many of these
expenses, such as sales commissions, warranty expenses and
incentive compensation are variable and correlate with net sales
and pro   tability.
(1) EBITDA and free cash    ow are    nancial measures that do not conform to
generally accepted accounting principles (GAAP). Additional disclosures regarding
these non-GAAP    nancial measures, including a reconciliation of EBITDA to net
income and free cash    ow to cash    ow from operations, are found in Item 7 of
Marine Products Corporation   s 10K    ling (included in this 2024 Annual Report).

310 OSX
Operating income in 2024 was $18.3 million or 7.7% of net sales,
compared with $49.2 million or 12.8% of net sales, in 2023.
Interest income was $2.9 million in 2024, consistent with the prior
year. The Company paid a special cash dividend of $24 million
in the second quarter; had it not been for this dividend, we would
have maintained higher average cash balances and produced
signi   cantly more interest income.
Net income was $17.9 million or $0.50 of diluted earnings per
share (EPS) in 2024, down from $41.7 million or $1.21 of EPS last
year. Net income bene   tted from a lower tax rate in 2024 related
to credits received in conjunction with our solar panel project.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) (1) was $21.1 million in 2024, compared with $51.6 million
in 2023.
Cash provided by operating activities in 2024 was $29.5 million,
down from $56.8 million in 2023. The Company bene   ted from
favorable working capital movements typically associated with
reduced sales, with operating cash    ow tracking net income.
Capital expenditures in 2024 of $4.6 million were lower than
the prior year when we made more signi   cant investments in our
   eet of trailers and our warehouses. The major capital project in
2024 was the installation of a rooftop solar energy system at our
manufacturing site in Nashville, Georgia. This project is expected
to deliver energy cost savings as well as environmental bene   ts.
Free cash    ow (1) (de   ned as cash    ow from operations less capital
expenditures) was $24.9 million in 2024.
During 2024, our Board of Directors continued the Company   s regular quarterly cash dividends for the thirteenth consecutive year. We
paid $19.4 million in regular quarterly dividends ($0.56 per share)
and a special dividend of $24.3 million ($0.70 per share) during the
second quarter, resulting in total cash dividends to shareholders of
$43.7 million ($1.26 per share) in 2024. We view our dividend policy
as a vital component of long-term stockholder value creation and
will continue to assess our regular dividend as well as other means
of distributing excess capital to our stockholders. Even after this
signi   cant return of capital to our investors, we ended 2024 with
$52 million in cash on the balance sheet and no debt.
LOOKING AHEAD As we push ahead into 2025, we are staying
the course, focused on those elements of our business we can
control until the external environment improves. These include
projects to drive efficiency and pro   tability, investments in our
dealer network to maintain brand leadership and maximize market
share and a continued focus on our products to offer consumers
the highest quality engineering and design within our categories.
In addition, we have ample cash reserves to invest in potential
acquisitions. Acquisitions could offer a pathway to increased scale
by expanding our brand portfolio with complementary offerings.
The boat manufacturing industry is highly fragmented with
numerous high-quality smaller companies that would be a strong
   t under the Marine Products umbrella. We will continue to assess
potential targets with the same    nancial, operational and strategic
discipline we have always exercised, and, hopefully, we can    nd
the right deal to drive value for our Company.
I want to thank all our stockholders, employees and dealers for
your continued support and commitment. We believe we have
some of the best boat builders in the industry and that their
commitment to their craft underpins the outstanding reputations
Chaparral and Robalo enjoy in the marketplace. I also want to
highlight the celebration of the Chaparral brand   s 60th anniversary
this past year, marking another milestone on our journey as an
industry leader in design and innovation. In addition, we would
like to recognize two of our Directors, Gary W. Rollins and Pamela
R. Rollins, who have chosen not to stand for re-election at our
upcoming Annual Shareholders    Meeting, and sincerely thank
them for their many years of service and support on our Board. To
our dealers, many of whom have been with us for several decades,
you represent our company to the consumer, ultimately serving
as our brand ambassadors. We appreciate your support and
partnership and look forward to continued, shared success.
Sincerely,
BEN M. PALMER
President and Chief Executive Officer
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 3/12/2025 Letter Continued (Full PDF)