Brunswick: Engine sales up, boat sales down
Brunswick Corp. released its third quarter numbers Thursday, with a similar message as in all its recent earnings reports: the aluminum and outboard market is growing; fiberglass sterndrive and inboard continues to struggle.
For the third quarter, Brunswick had net sales of $892.4 million, up 2 percent from 2012. Year-to-date, sales are up 3 percent.
The Marine Engine segment continued to be the stronger portion of the business, but growth in that division has slowed from earlier this year. The net sales of $511.1 million in the third quarter was up 2 percent from 2012. The company also had a “solid increase” in parts and accessories, which is part of the engine group, said CEO Dusty McCoy. In fact, both Atwood and Land & Sea have record earnings through the first nine months of the year.
In the Boat Segment, net sales were down 2 percent from the third quarter of 2012 to $191.7 million.
Part of that is by design, McCoy said, as Brunswick makes the decision not to compete as much in the tight-margin, under-23-foot sterndrive market.
“When we get to the sterndrive/inboard product, we’re not gaining share, we’re probably losing a little share,” McCoy said. “That’s according to plan. There’s a lot of small product where we’ve just taken products out.”
Brunswick is also trying to decrease the complexity of its offerings by eliminating some models in the 23- to-40-foot range as well. As for the 40-to-65-foot range, Brunswick is making an “enormous investment” in refreshing its offerings there, McCoy said, with those new designs being rolled out in 2014 and 2015.
At the same time, Brunswick is continuing to gain market share in the fastest growing segments of aluminum fish, pontoon and outboard fiberglass, McCoy said.
Results from the sold Hatteras and CABO boat businesses are not included in the numbers reported, but there were some costs associated with the decision to cancel the Sea Ray jet boat project that affected the bottom line, said CFO Bill Metzger. He declined to say just how much those costs were and that the company, and added that the company had “no plans” to get back into the jet segment.