ATLANTA -- Marine Products Corporation (NYSE: MPX) announced its unaudited results for the quarter and year ended December 31, 2013. Marine Products is a leading manufacturer of fiberglass boats under two brand names: sterndrive and inboard pleasure boats by Chaparral, including H2O Sport and Fish & Ski Boats, SSi and SSX Sportboats, Sunesta Sportdecks, Xtreme Towboats, Signature Cruisers, and Robalo outboard sport fishing boats.
For the quarter ended December 31, 2013, Marine Products generated net sales of $39,534,000, a 15.8 percent increase compared to $34,152,000 in the same period the prior year. The increase in net sales was due to an increase of 8.0 percent in the number of units sold and a 6.3 percent increase in the average selling price per boat, as well as higher parts and accessories sales. Unit sales and average selling prices of our Robalo sport fishing boats increased significantly. Average selling prices of several of our Chaparral models increased as well, due to a favorable model mix that included a greater number of large Chaparral SSX Sportboats and Sunesta Sportdecks.
Gross profit for the quarter was $8,207,000, or 20.8 percent of net sales, a 48.2 percent increase compared to gross profit of $5,538,000, or 16.2 percent of net sales, in the same period the prior year. As a percentage of net sales, gross profit increased due to lower materials costs during the quarter and a favorable model mix. In contrast to the quarter's positive model mix, our model mix in the fourth quarter of 2012 contained a higher percentage of value-priced Chaparral H2O models, which generate lower gross profit margins.
Operating profit for the quarter increased by 177.4 percent to $3,260,000 compared to $1,175,000 in the fourth quarter of last year due to higher gross profit, partially offset by higher selling, general and administrative expenses. Selling, general and administrative expenses increased by 13.4 percent to $4,947,000 in the fourth quarter of 2013 compared to $4,363,000 last year. These expenses increased due to expenses which vary with sales and profitability, such as incentive compensation and sales commissions. As a percentage of net sales, these expenses decreased slightly during the fourth quarter of 2013 compared to the fourth quarter of 2012. Interest income was $114,000 during the fourth quarter of 2013, a decline of 58.1 percent compared to $272,000 during the fourth quarter of 2012. Interest income decreased during the quarter primarily due to a lower average marketable securities balance during the fourth quarter of 2013 compared to the prior year.
Net income for the quarter ended December 31, 2013 was $2,408,000, compared to net income of $1,064,000 for the fourth quarter of 2012. Diluted earnings per share were $0.06 in the fourth quarter of 2013 compared to $0.03 in the fourth quarter of last year.
Net sales for the twelve months ended December 31, 2013 were $168,041,000, a 12.8 percent increase compared to the prior year. Net income for the twelve months ended December 31, 2013 was $7,794,000, or $0.21 per diluted share, compared to net income of$6,979,000, or $0.19 per diluted share, in 2012.
Richard A. Hubbell, Marine Products' Chief Executive Officer stated, "Our financial results for the fourth quarter reflect continued growth in the sales of our Robalo sport fishing boats and a favorable model mix both at Robalo and several of our Chaparral product lines. Higher production also enhanced our profitability. At the end of the quarter, our dealer inventories were higher than at the same time in 2012, which we believe to be appropriate given our belief that consumer demand will be stronger in the upcoming retail selling season. The winter boat show season has started, and in general, attendance is higher than last year, as is the interest level of boat show attendees.
"Dealer and consumer interest in our 2014 models remains strong. We sold more of our larger SSX Sportboats in the fourth quarter, as well as more larger Robalo sport fishing boats. Interest in our new Vortex jet boat continues to be strong, and we will introduce three jet boat models during the 2014 retail selling season. In a relatively lackluster selling environment for sterndrive fiberglass recreational boats, we are pleased to report continued leading market share. The most recently available market share statistics from Statistical Surveys, Inc., show that for the first nine months of 2013, Chaparral's share of the 18- to 35-foot sterndrive market was 13.9 percent, compared to 11.7 percent during the same period in 2012, and that we held the largest market share within this segment. Our leading market share is the result of our enduring ability to provide our customers with high-quality, stylish products throughout the economic cycles," said Hubbell.
Marine Products Corporation will hold a conference call today, January 29, 2014 at 8:00 a.m. Eastern Time to discuss the results for the fourth quarter. Interested parties may listen in by accessing a live webcast in the investor relations section of Marine Products' website at www.marineproductscorp.com. The live conference call can also be accessed by calling (888) 481-2844 or (719) 457-2085 and using the conference ID #6631335. A replay of the conference call will be available in the investor relations section of Marine Products' website beginning approximately two hours after the call.Click here for reuse options!
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