08/05/2022 | Press release | Distributed by Public on 08/05/2022 14:30
☑ |
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐ |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
(State or other jurisdiction of incorporation or organization)
|
83-4330138
(IRS Employer Identification No.)
|
|
6275 Lanier Islands Parkway
Buford, Georgia
(Address of principal executive offices)
|
30518
(Zip code)
|
Title of Each Class
|
Trading Symbol(s)
|
Name of Each Exchange on Which Registered
|
||
Class A common stock, par value $0.01 per share
|
ONEW
|
The Nasdaq Global Market
|
Large accelerated filer
|
☐
|
Accelerated filer ☒
|
Non-accelerated filer
|
☐
|
Smaller reporting company ☐
|
Emerging growth company ☐
|
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
|
3 | |
PART I - FINANCIAL INFORMATION
|
4 | |
Item 1. |
Condensed Consolidated Financial Statements (Unaudited)
|
4 |
Condensed Consolidated Balance Sheets as of June 30, 2022 and September 30, 2021
|
4 | |
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended June 30, 2022 and June 30, 2021
|
5 | |
Condensed Consolidated Statements of Stockholders' Equity for the Three and Nine Months Ended June 30, 2022 and June 30, 2021
|
6 | |
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended June 30, 2022 and June 30, 2021
|
8 |
|
Notes to the Condensed Consolidated Financial Statements
|
9 |
|
Item 2. |
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
22 |
Item 3. |
Quantitative and Qualitative Disclosure about Market Risk
|
37 |
Item 4. |
Controls and Procedures
|
37 |
PART II - OTHER INFORMATION
|
37 |
|
Item 1. |
Legal Proceedings
|
37 |
Item 1A. |
Risk Factors
|
37 |
Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds
|
38 |
Item 3. |
Defaults Upon Senior Securities
|
38 |
Item 4. |
Mine Safety Disclosures
|
38 |
Item 5. |
Other Information
|
38 |
Item 6. |
Exhibits
|
39 |
|
• |
the impact of the novel coronavirus ("COVID-19") on our business and results of operations;
|
|
• |
general economic conditions, including changes in employment levels, consumer demand, preferences and confidence levels, fuel prices, inflation, levels of discretionary income, consumer spending patterns and uncertainty regarding the timing, pace and extent of an economic recovery in the United States;
|
|
• |
economic conditions in certain geographic regions in which we primarily generate our revenue;
|
|
• |
credit markets and the availability and cost of borrowed funds;
|
|
• |
our business strategy, including acquisitions and same-store growth;
|
|
• |
our ability to integrate acquired marine retailers;
|
|
• |
our ability to maintain our relationships with manufacturers, including meeting the requirements of our dealer agreements and receiving the benefits of certain manufacturer incentives;
|
|
• |
our ability to finance working capital and capital expenditures;
|
|
• |
demand for our products and our ability to maintain acceptable pricing for our products and services, including financing, insurance and extended service contracts;
|
|
• |
our operating cash flows, the availability of capital and our liquidity;
|
|
• |
our future revenue, same-store sales, income, financial condition, and operating performance;
|
|
• |
our ability to sustain and improve our utilization, revenue and margins;
|
|
• |
competition;
|
|
• |
seasonality and inclement weather such as hurricanes, severe storms, fire and floods, generally and in certain geographic regions in which we primarily generate our revenue;
|
•
|
any potential tax savings we may realize as a result of our organizational structure;
|
|
• |
our future operating results and profitability;
|
|
• |
our ability to successfully close the pending acquisition of Ocean Bio-Chem, Inc. ("OBCI"), or once closed, integrate the operations of OBCI with our existing operations and fully realize the expected synergies of the OBCI Acquisitions (as defined below) or on the expected timeline; and
|
|
• |
plans, objectives, expectations and intentions contained in this Form 10-Q that are not historical.
|
|
• |
decline in demand for our products and services;
|
|
• |
the effects of the COVID-19 pandemic on the Company's business;
|
|
• |
other risks associated with the COVID-19 pandemic including, among others, the ability to safely operate our stores, access to inventory and customer demand;
|
|
• |
the seasonality and volatility of the boat industry;
|
|
• |
global public health concerns, including the COVID-19 pandemic;
|
|
• |
general domestic and international political and regulatory conditions, including changes in tax or fiscal policy and the effects of current restrictions on various commercial and economic activities in response to the COVID-19 pandemic;
|
|
• |
environmental conditions and real or perceived human health or safety risks;
|
|
• |
our acquisition strategies and our ability to integrate additional marine retailers;
|
|
• |
effects of industry-wide supply chain challenges and our ability to manage our inventory;
|
|
• |
our ability to retain key personnel and the effects of labor shortages;
|
|
• |
the inability to comply with the financial and other covenants and metrics in our credit facilities;
|
|
• |
cash flow and access to capital;
|
|
• |
the timing of development expenditures; and
|
|
• |
the other risks described under "Risk Factors" and discussed elsewhere in our Annual Report on Form 10-K for the year ended September 30, 2021 and discussed elsewhere in this Quarterly Report on Form 10-Q.
|
Item 1. |
Condensed Consolidated Financial Statements (Unaudited)
|
June 30,
2022
|
September 30,
2021 |
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash
|
$
|
95,690
|
$
|
62,606
|
||||
Restricted cash
|
16,209
|
11,343
|
||||||
Accounts receivable, net
|
80,495
|
28,529
|
||||||
Inventories, net
|
269,430
|
143,880
|
||||||
Prepaid expenses and other current assets
|
57,389
|
34,580
|
||||||
Total current assets
|
519,213
|
280,938
|
||||||
Property and equipment, net
|
80,235
|
67,114
|
||||||
Operating lease right-of-use assets |
126,433 | 89,141 | ||||||
Other assets:
|
||||||||
Deposits
|
823
|
526
|
||||||
Deferred tax assets
|
32,585
|
29,110
|
||||||
Identifiable intangible assets, net
|
245,659
|
85,294
|
||||||
Goodwill
|
342,605
|
168,491
|
||||||
Total other assets
|
621,672
|
283,421
|
||||||
Total assets
|
$
|
1,347,553
|
$
|
720,614
|
||||
Liabilities and Stockholders' Equity
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
51,199
|
$
|
18,114
|
||||
Other payables and accrued expenses
|
54,725
|
27,665
|
||||||
Customer deposits
|
65,520
|
46,610
|
||||||
Notes payable - floor plan
|
217,338
|
114,234
|
||||||
Current portion of operating lease liabilities
|
12,788 | 9,159 | ||||||
Current portion of long-term debt
|
19,450
|
11,366
|
||||||
Current portion of tax receivable agreement liability
|
915
|
482
|
||||||
Total current liabilities
|
421,935
|
227,630
|
||||||
Long-term Liabilities:
|
||||||||
Other long-term liabilities
|
25,766
|
14,991
|
||||||
Tax receivable agreement liability
|
45,290
|
39,622
|
||||||
Noncurrent operating lease liabilities | 114,545 | 80,464 | ||||||
Long-term debt, net of current portion and unamortized debt issuance costs
|
316,349
|
103,074
|
||||||
Total liabilities |
923,885 | 465,781 | ||||||
Stockholders' Equity:
|
||||||||
Preferred stock, $0.01par value, 1,000,000shares authorized, noneissued and outstanding as of June 30, 2022and September 30, 2021
|
-
|
-
|
||||||
Class A common stock, $0.01par value, 40,000,000shares authorized, 14,133,130shares issued and outstanding as of June 30, 2022and 13,276,538issued and outstanding as of September 30, 2021
|
141
|
133
|
||||||
Class B common stock, $0.01par value, 10,000,000shares authorized, 1,429,940shares issued and outstanding as of June 30, 2022and 1,819,112issued and outstanding as of September 30, 2021
|
14
|
18
|
||||||
Additional paid-in capital
|
178,347
|
150,825
|
||||||
Retained earnings
|
186,536
|
74,952
|
||||||
Total stockholders' equity attributable to OneWater Marine Inc.
|
365,038
|
225,928
|
||||||
Equity attributable to non-controlling interests
|
58,630
|
28,905
|
||||||
Total stockholders' equity
|
423,668
|
254,833
|
||||||
Total liabilities and stockholders' equity
|
$
|
1,347,553
|
$
|
720,614
|
Three Months Ended
June 30,
|
Nine Months Ended
June 30,
|
|||||||||||||||
2022
|
2021
|
2022
|
2021
|
|||||||||||||
Revenues
|
||||||||||||||||
New boat
|
$
|
376,886
|
$
|
288,222
|
$
|
903,104
|
$
|
679,704
|
||||||||
Pre-owned boat
|
98,181
|
71,116
|
227,484
|
165,778
|
||||||||||||
Finance & insurance income
|
18,979
|
15,238
|
43,234
|
32,990
|
||||||||||||
Service, parts & other
|
74,854
|
29,631
|
173,477
|
69,429
|
||||||||||||
Total revenues
|
568,900
|
404,207
|
1,347,299
|
947,901
|
||||||||||||
Cost of sales (exclusive of depreciation and amortization shown separately below)
|
||||||||||||||||
New boat
|
274,544
|
211,141
|
659,046
|
520,820
|
||||||||||||
Pre-owned boat
|
68,749
|
52,566
|
164,078
|
125,566
|
||||||||||||
Service, parts & other
|
41,668
|
13,548
|
96,729
|
33,341
|
||||||||||||
Total cost of sales
|
384,961
|
277,255
|
919,853
|
679,727
|
||||||||||||
Selling, general and administrative expenses
|
87,867
|
60,476
|
222,455
|
143,685
|
||||||||||||
Depreciation and amortization
|
4,073
|
1,475
|
10,549
|
3,816
|
||||||||||||
Transaction costs
|
1,337
|
65
|
5,158
|
633
|
||||||||||||
Change in fair value of contingent consideration
|
3,118
|
-
|
11,022
|
377
|
||||||||||||
Income from operations
|
87,544
|
64,936
|
178,262
|
119,663
|
||||||||||||
Other expense (income)
|
||||||||||||||||
Interest expense - floor plan
|
1,131
|
956
|
3,056
|
2,206
|
||||||||||||
Interest expense - other
|
3,311
|
1,083
|
7,937
|
3,222
|
||||||||||||
Other (income) expense, net
|
(166
|
)
|
(158
|
)
|
491
|
(247
|
)
|
|||||||||
Total other expense, net
|
4,276
|
1,881
|
11,484
|
5,181
|
||||||||||||
Income before income tax expense
|
83,268
|
63,055
|
166,778
|
114,482
|
||||||||||||
Income tax expense
|
18,785
|
11,498
|
36,455
|
20,559
|
||||||||||||
Net income
|
64,483
|
51,557
|
130,323
|
93,923
|
||||||||||||
Less: Net income attributable to non-controlling interests
|
(959 | ) |
-
|
(1,970 | ) |
-
|
||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC
|
(7,547
|
)
|
(17,054
|
)
|
(16,060
|
)
|
(31,158
|
)
|
||||||||
Net income attributable to OneWater Marine Inc.
|
$
|
55,977
|
$
|
34,503
|
$
|
112,293
|
$
|
62,765
|
||||||||
Earnings per share of Class A common stock - basic
|
$
|
3.96
|
$
|
3.14
|
$
|
8.14
|
$
|
5.77
|
||||||||
Earnings per share of Class A common stock - diluted
|
$
|
3.86
|
$
|
3.04
|
$
|
7.90
|
$
|
5.63
|
||||||||
Basic weighted-average shares of Class A common stock outstanding
|
14,133
|
10,976
|
13,791
|
10,884
|
||||||||||||
Diluted weighted-average shares of Class A common stock outstanding
|
14,512
|
11,341
|
14,205
|
11,143
|
Class A Common Stock
|
Class B Common Stock
|
|||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Additional Paid-in Capital
|
Retained Earnings
|
Non-
controlling Interest
|
Total
Stockholders'
Equity
|
|||||||||||||||||||||||||
Balance at September 30, 2021
|
13,277
|
$
|
133
|
1,819
|
$
|
18
|
$
|
150,825
|
$
|
74,952
|
$
|
28,905
|
$
|
254,833
|
||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
-
|
20,019
|
3,467
|
23,486
|
||||||||||||||||||||||||
Distributions to members
|
-
|
-
|
-
|
-
|
-
|
(442
|
)
|
(177
|
)
|
(619
|
)
|
|||||||||||||||||||||
Non-controlling interest in subsidiary
|
- | - | - | - | - | - | 19,311 | 19,311 | ||||||||||||||||||||||||
Exchange of B shares for A shares
|
389
|
4
|
(389
|
)
|
(4
|
)
|
7,405
|
-
|
(7,405
|
)
|
-
|
|||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
|
-
|
-
|
-
|
-
|
(283
|
)
|
-
|
-
|
(283
|
)
|
||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding
|
53 | 1 | - | - | (469 | ) | - | - | (468 | ) | ||||||||||||||||||||||
Shares issued in connection with a business combination
|
133 | 1 | - | - | 6,833 | - | - | 6,834 | ||||||||||||||||||||||||
Equity-based compensation
|
-
|
-
|
-
|
-
|
2,100
|
-
|
-
|
2,100
|
||||||||||||||||||||||||
Balance at December 31, 2021
|
13,852
|
$
|
139
|
1,430
|
$
|
14
|
$
|
166,411
|
$
|
94,529
|
$
|
44,101
|
$
|
305,194
|
||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
-
|
36,297
|
6,057
|
42,354
|
||||||||||||||||||||||||
Distributions to members
|
-
|
-
|
-
|
-
|
-
|
(266
|
)
|
(605
|
)
|
(871
|
)
|
|||||||||||||||||||||
Exchange of B shares for A shares
|
-
|
-
|
-
|
-
|
(574
|
)
|
-
|
574
|
-
|
|||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding
|
27
|
-
|
-
|
-
|
(455
|
)
|
-
|
-
|
(455
|
)
|
||||||||||||||||||||||
Equity-based compensation
|
-
|
-
|
-
|
-
|
2,713
|
-
|
-
|
2,713
|
||||||||||||||||||||||||
Balance at March 31, 2022
|
13,879
|
$
|
139
|
1,430
|
$
|
14
|
$
|
168,095
|
$
|
130,560
|
$
|
50,127
|
$
|
348,935
|
||||||||||||||||||
Net income
|
- | - | - | - | - | 55,977 | 8,506 | 64,483 | ||||||||||||||||||||||||
Distributions to members
|
- | - | - | - | - | (1 | ) | (3 | ) | (4 | ) | |||||||||||||||||||||
Shares issued in connection with a business combination
|
254 | 2 | - | - | 7,791 | - | - | 7,793 | ||||||||||||||||||||||||
Equity-based compensation
|
- | - | - | - | 2,461 | - | - | 2,461 | ||||||||||||||||||||||||
Balance at June 30, 2022
|
14,133 |
$ |
141 | 1,430 |
$ |
14 |
$ |
178,347 |
$ |
186,536 |
$ |
58,630 |
$ |
423,668 |
Class A Common Stock
|
Class B Common Stock
|
|||||||||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Additional Paid-in Capital
|
Retained Earnings
|
Non-
controlling Interest
|
Total
Stockholders'
Equity
|
|||||||||||||||||||||||||
Balance at September 30, 2020
|
10,392
|
$
|
104
|
4,583
|
$
|
46
|
$
|
105,947
|
$
|
16,757
|
$
|
50,433
|
$
|
173,287
|
||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
-
|
7,788
|
3,987
|
11,775
|
||||||||||||||||||||||||
Distributions to members
|
-
|
-
|
-
|
-
|
-
|
-
|
(1,319
|
)
|
(1,319
|
)
|
||||||||||||||||||||||
Effect of September offering, including underwriter exercise of option to purchase shares
|
387
|
4
|
(387
|
)
|
(4
|
)
|
4,146
|
-
|
(4,256
|
)
|
(110
|
)
|
||||||||||||||||||||
Exchange of B shares for A shares
|
88
|
1
|
(88
|
)
|
(1
|
)
|
916
|
-
|
(916
|
)
|
-
|
|||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
|
- | - | - | - | (228 | ) | - | - | (228 | ) | ||||||||||||||||||||||
Adjustment to adopt Topic 842
|
- | - | - | - | - | 1,073 | - | 1,073 | ||||||||||||||||||||||||
Equity-based compensation
|
-
|
-
|
-
|
-
|
1,078
|
-
|
-
|
1,078
|
||||||||||||||||||||||||
Balance at December 31, 2020
|
10,867
|
$
|
109
|
4,108
|
$
|
41
|
$
|
111,859
|
$
|
25,618
|
$
|
47,929
|
$
|
185,556
|
||||||||||||||||||
Net income
|
-
|
-
|
-
|
-
|
-
|
20,475
|
10,117
|
30,592
|
||||||||||||||||||||||||
Distributions to members
|
-
|
-
|
-
|
-
|
-
|
(61
|
)
|
(140
|
)
|
(201
|
)
|
|||||||||||||||||||||
Exchange of B shares for A shares
|
37
|
-
|
(37
|
)
|
-
|
558
|
-
|
(558
|
)
|
-
|
||||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
|
-
|
-
|
-
|
-
|
(6
|
)
|
-
|
-
|
(6
|
)
|
||||||||||||||||||||||
Shares issued upon vesting of equity-based awards, net of tax withholding
|
64
|
1
|
-
|
-
|
(450
|
)
|
-
|
-
|
(449
|
)
|
||||||||||||||||||||||
Equity-based compensation
|
-
|
-
|
-
|
-
|
1,127
|
-
|
-
|
1,127
|
||||||||||||||||||||||||
Balance at March 31, 2021 | 10,968 | $ | 110 | 4,071 | $ | 41 | $ | 113,088 | $ | 46,032 | $ | 57,348 | $ | 216,619 | ||||||||||||||||||
Net income
|
- | - | - | - | - | 34,503 | 17,054 | 51,557 | ||||||||||||||||||||||||
Distributions to members
|
- | - | - | - | - | (45 | ) | (2,206 | ) | (2,251 | ) | |||||||||||||||||||||
Dividends and distributions declared ($1.80per share and per unit, respectively)
|
- | - | - | - | - | (20,461 | ) | (7,328 | ) | (27,789 | ) | |||||||||||||||||||||
Exchange of B shares for A shares
|
694 | 7 | (694 | ) | (7 | ) | 11,214 | - | (11,214 | ) | - | |||||||||||||||||||||
Establishment of liabilities under tax receivable agreement and related changes to deferred tax assets associated with increases in tax basis
|
- | - | - | - | (1,805 | ) | - | - | (1,805 | ) | ||||||||||||||||||||||
Equity-based compensation
|
- | - | - | - | 1,146 | - | - | 1,146 | ||||||||||||||||||||||||
Balance at June 30, 2021
|
11,662 |
$ |
117 | 3,377 |
$ |
34 |
$ |
123,643 |
$ |
60,029 |
$ |
53,654 |
$ |
237,477 |
For the Nine Months Ended June 30
|
2022
|
2021 | ||||||
Cash flows from operating activities
|
||||||||
Net income
|
$
|
130,323
|
$
|
93,923
|
||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
10,816
|
3,816
|
||||||
Equity-based awards
|
7,274
|
3,351
|
||||||
Gain on asset disposals
|
(59
|
)
|
(196
|
)
|
||||
Non-cash interest expense
|
1,370
|
503
|
||||||
Deferred income tax provision
|
2,030
|
2,338
|
||||||
Loss on change in fair value of contingent consideration
|
11,022 | - | ||||||
(Increase) decrease in assets:
|
||||||||
Accounts receivable
|
(41,235
|
)
|
(19,031
|
)
|
||||
Inventories
|
(88,158
|
)
|
47,146
|
|||||
Prepaid expenses and other assets
|
(17,770
|
)
|
(16,767
|
)
|
||||
Deposits
|
(160
|
)
|
(152
|
)
|
||||
Increase (decrease) in liabilities:
|
||||||||
Accounts payable
|
33,624
|
11,124
|
||||||
Other payables and accrued expenses
|
8,096
|
5,662
|
||||||
Tax receivable agreement liability
|
313 | - | ||||||
Customer deposits
|
4,637
|
21,478
|
||||||
Net cash provided by operating activities
|
62,123
|
153,195
|
||||||
Cash flows from investing activities
|
||||||||
Purchases of property and equipment and construction in progress
|
(11,649
|
)
|
(7,802
|
)
|
||||
Proceeds from disposal of property and equipment
|
122
|
168
|
||||||
Cash used in acquisitions
|
(326,089
|
)
|
(83,486
|
)
|
||||
Net cash used in investing activities
|
(337,616
|
)
|
(91,120
|
)
|
||||
Cash flows from financing activities
|
||||||||
Net borrowings from floor plan
|
103,103
|
(27,455
|
)
|
|||||
Proceeds from long-term debt
|
240,000
|
30,000
|
||||||
Payments of long-term debt
|
(18,090
|
)
|
(7,237
|
)
|
||||
Payments of debt issuance costs
|
(4,057
|
)
|
(701
|
)
|
||||
Payments of September 2020 offering costs
|
-
|
(540
|
)
|
|||||
Payments of contingent consideration |
(133 | ) | - | |||||
Payments of tax withholdings for equity-based awards
|
(923
|
)
|
(449 | ) | ||||
Distributions to members
|
(6,457
|
)
|
(3,160
|
)
|
||||
Net cash provided by (used in) financing activities
|
313,443
|
(9,542
|
)
|
|||||
Net change in cash
|
37,950
|
52,533
|
||||||
Cash and restricted cash at beginning of period
|
73,949
|
68,153
|
||||||
Cash and restricted cash at end of period
|
$
|
111,899
|
$
|
120,686
|
||||
Supplemental cash flow disclosures
|
||||||||
Cash paid for interest
|
$
|
9,623
|
$
|
4,925
|
||||
Cash paid for income taxes
|
6,344
|
13,993
|
||||||
Noncash items
|
||||||||
Acquisition purchase price funded by seller notes payable
|
$
|
1,126
|
$
|
2,056
|
||||
Acquisition purchase price funded by contingent consideration
|
15,321
|
5,482
|
||||||
Acquisition purchase price funded by issuance of Class A common stock
|
6,834 | - | ||||||
Purchase of property and equipment funded by long-term debt
|
1,423
|
1,693
|
||||||
Initial operating lease right-of-use assets for adoption of Topic 842 |
- | 71,835 | ||||||
Right-of-use assets obtained in exchange for new operating lease liabilities | 46,378 | 17,224 | ||||||
Dividends and distributions payable
|
- | 27,789 | ||||||
Distributions to members payable
|
- | 610 |
1. |
Description of Company and Basis of Presentation
|
2. |
Summary of Significant Accounting Policies
|
($ in thousands)
|
Three Months Ended
June 30, 2022
|
Nine Months Ended June 30, 2022 |
||||||
Beginning contract liability
|
$
|
63,514
|
$
|
46,610
|
||||
Revenue recognized from contract liabilities included in the beginning balance
|
(35,337
|
)
|
(42,595
|
)
|
||||
Increases due to cash received, net of amounts recognized in revenue during the period
|
37,343
|
61,505
|
||||||
Ending contract liability
|
$
|
65,520
|
$
|
65,520
|
Three Months Ended
June 30, 2022
|
Three Months Ended
June 30, 2021
|
|||||||
Goods and services transferred at a point in time
|
95.0
|
%
|
94.4
|
%
|
||||
Goods and services transferred over time
|
5.0
|
%
|
5.6
|
%
|
||||
Total Revenue
|
100.0
|
%
|
100.0
|
%
|
Nine Months Ended
June 30, 2022
|
Nine Months Ended June 30, 2021 |
|||||||
Goods and services transferred at a point in time
|
94.6
|
%
|
94.1
|
%
|
||||
Goods and services transferred over time
|
5.4
|
%
|
5.9
|
%
|
||||
Total Revenue
|
100.0
|
%
|
100.0
|
%
|
3. |
New Accounting Pronouncements
|
4. |
Acquisitions
|
•
|
On October 1, 2021, Naples Boat Mart with one location in Florida
|
•
|
On November 30, 2021, T-H Marine, a leading provider of branded marine parts and accessories, with locations in Alabama, Florida, Illinois, Indiana, Oklahoma and Texas
|
•
|
On December 1, 2021, Norfolk Marine Company with one location in Virginia
|
•
|
On December 31, 2021, a majority interest in Quality Boats with three locations in Florida. The sellers retained a 20% economic interest in Quality Boats. The Company has the exclusive right, but not obligation, to acquire the remaining 20% interest at any time before January 1, 2027.
|
•
|
On February 1, 2022, JIF Marine, a leading supplier of stainless steel ladders, dock products and other accessories which is based in Tennessee
|
•
|
On March 1, 2022, YakGear, a leading supplier of kayak equipment, paddle sports accessories and boat mounting accessories which is based in Texas
|
•
|
On April 1, 2022, Denison Yachting, a leader in yacht and superyacht sales as well as ancillary yacht services, with 20retail locations in 7states
|
Summary of Assets Acquired and Liabilities Assumed
($ in thousands) |
T-H Marine |
Quality Boats |
Denison |
Other
Acquisitions
|
Total
Acquisitions
|
|||||||||||||||
Accounts receivable
|
$
|
8,955
|
$
|
-
|
$ | 654 |
$
|
1,122
|
$
|
10,731
|
||||||||||
Inventories
|
19,856
|
5,937
|
1,981 |
9,618
|
37,392
|
|||||||||||||||
Prepaid expenses
|
1,547
|
47
|
2,053 |
357
|
4,004
|
|||||||||||||||
Property and equipment
|
3,896
|
803
|
293 |
1,227
|
6,219
|
|||||||||||||||
Deposits
|
- | - | 126 | 13 | 139 | |||||||||||||||
Operating lease right-of-use assets
|
5,960
|
11,877
|
1,221 |
7,375
|
26,433
|
|||||||||||||||
Identifiable intangible assets
|
105,500
|
31,700
|
16,600 |
11,276
|
165,076
|
|||||||||||||||
Goodwill
|
51,694
|
78,682
|
29,144 |
14,594
|
174,114
|
|||||||||||||||
Accounts payable
|
(3,876
|
)
|
-
|
(80 | ) |
(471
|
)
|
(4,427
|
)
|
|||||||||||
Accrued expenses
|
(1,697
|
)
|
-
|
(252 | ) |
(553
|
)
|
(2,502
|
)
|
|||||||||||
Customer deposits
|
(394
|
)
|
(5,047
|
)
|
(5,524 | ) |
(3,307
|
)
|
(14,272
|
)
|
||||||||||
Operating lease liabilities
|
(5,960
|
)
|
(11,877
|
)
|
(1,221 | ) |
(7,375
|
)
|
(26,433
|
)
|
||||||||||
Aggregate acquisition date fair value
|
$
|
185,481
|
$
|
112,122
|
$ | 44,995 |
$
|
33,876
|
$
|
376,474
|
||||||||||
Consideration transferred
|
$
|
185,481
|
$
|
92,811
|
$ | 44,995 |
$
|
33,876
|
$
|
357,163
|
||||||||||
Fair value of non-controlling interests
|
-
|
19,311
|
- |
-
|
19,311
|
|||||||||||||||
Aggregate acquisition date fair value
|
$
|
185,481
|
$
|
112,122
|
$ | 44,995 |
$
|
33,876
|
$
|
376,474
|
Three Months Ended
June 30, 2021
|
||||
($ in thousands)
|
||||
(Unaudited)
|
||||
Pro forma revenue
|
$
|
526,136
|
||
Pro forma net income
|
$
|
66,648
|
Nine Months Ended
June 30, 2022
|
Nine Months Ended
June 30, 2021
|
|||||||
($ in thousands)
|
||||||||
(Unaudited)
|
||||||||
Pro forma revenue
|
$
|
1,431,881
|
$
|
1,297,780
|
||||
Pro forma net income
|
$
|
135,253
|
$
|
129,158
|
5. |
Inventories
|
($ in thousands)
|
June 30, 2022
|
September 30, 2021
|
||||||
New vessels
|
$
|
182,184
|
$
|
105,625
|
||||
Pre-owned vessels
|
37,443
|
22,906
|
||||||
Work in process, parts and accessories, net
|
49,803
|
15,349
|
||||||
$
|
269,430
|
$
|
143,880
|
6. |
Goodwill and Other Identifiable Intangible Assets
|
($ in thousands)
|
Goodwill
|
Trade Names
|
Design
Libraries
|
Customer Relationships
|
Total Identifiable Intangible Assets, net
|
|||||||||||||||
Unamortized
|
Unamortized
|
Amortized
|
Amortized
|
|||||||||||||||||
Net balance as of September 30, 2021
|
$
|
168,491
|
$
|
85,294
|
$
|
-
|
$
|
-
|
$
|
85,294
|
||||||||||
Acquisitions during the nine months ended June 30, 2022
|
174,114
|
83,171
|
14,050
|
67,855
|
165,076
|
|||||||||||||||
Accumulated amortization for the nine months ended June 30, 2022
|
-
|
-
|
(808
|
)
|
(3,903
|
)
|
(4,711
|
)
|
||||||||||||
Net balance as of June 30, 2022
|
$
|
342,605
|
$
|
168,465
|
$
|
13,242
|
$
|
63,952
|
$
|
245,659
|
2022 (excluding the nine months ended June 30, 2022)
|
$
|
2,048
|
||
2023
|
8,190
|
|||
2024
|
8,190
|
|||
2025
|
8,190
|
|||
2026
|
8,190
|
|||
Thereafter
|
42,386
|
|||
$
|
77,194
|
7. |
Notes Payable - Floor Plan
|
8. |
Long-term Debt and Line of Credit
|
($ in thousands)
|
June 30,
2022
|
September 30,
2021
|
||||||
Term note payable to Truist Bank, secured and bearing interest at 4.5% at June 30, 2022and 2.75% at September 30, 2021. The note requires quarterly principal payments, maturing with a full repayment on July 22, 2025
|
$
|
293,958
|
$
|
105,875
|
||||
Revolving note payable for an amount up to $50.0million to Truist Bank, secured and bearing interest at 4.5% at June 30, 2022. The note requires full repayment on July 22, 2025
|
40,000
|
-
|
||||||
Note payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 8.9% per annum. The notes require monthlyinstallment payments of principal and interest ranging from $100to $5,600through July 2028
|
3,853
|
3,248
|
||||||
Note payable to Tom George Yacht Sales, Inc., unsecured and bearing interest at 5.5% per annum. The note requires quarterly interest payments, with a balloon payment of principal due on December 1, 2023
|
2,056
|
2,056
|
||||||
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note requires quarterly interest payments, with a balloon payment of principal due on December 1, 2024
|
1,126
|
-
|
||||||
Note payable to Central Marine Services, Inc., unsecured and bearing interest at 5.5% per annum. The note was repaid in full
|
-
|
2,164
|
||||||
Note payable to Ocean Blue Yacht Sales, unsecured and bearing interest at 5.0% per annum. The note was repaid in full
|
-
|
1,920
|
||||||
Note payable to Slalom Shop, LLC, unsecured and bearing interest at 5.0% per annum. The note was repaid in full
|
-
|
1,271
|
||||||
Total debt outstanding
|
340,993
|
116,534
|
||||||
Less current portion (net of debt issuance costs)
|
(19,450
|
)
|
(11,366
|
)
|
||||
Less unamortized portion of debt issuance costs
|
(5,194
|
)
|
(2,094
|
)
|
||||
Long-term debt, net of current portion of unamortized debt issuance costs
|
$
|
316,349
|
$
|
103,074
|
9. |
Stockholders' and Members' Equity
|
Restricted Stock Unit Awards
|
||||||||
Number of
Units
|
Weighted Average
Grant Date Fair Value
($)
|
|||||||
Unvested at September 30, 2021
|
545,094
|
$
|
22.68
|
|||||
Awarded
|
173,697
|
39.95
|
||||||
Vested
|
(100,872
|
)
|
16.99
|
|||||
Forfeited
|
-
|
-
|
||||||
Unvested at June 30, 2022
|
617,919
|
$
|
28.46
|
Earnings per share:
|
Three Months Ended
June 30, 2022
|
Three Months Ended
June 30, 2021
|
||||||
Numerator:
|
||||||||
Net income attributable to OneWater Inc.
|
$
|
55,977
|
$
|
34,503
|
||||
Denominator:
|
||||||||
Weighted-average number of unrestricted outstanding common shares used to calculate basic net income per share
|
14,133
|
10,976
|
||||||
Effect of dilutive securities:
|
||||||||
Restricted stock units
|
379
|
365
|
||||||
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted earnings per share
|
14,512
|
11,341
|
||||||
Earnings per share of Class A common stock - basic
|
$
|
3.96
|
$
|
3.14
|
||||
Earnings per share of Class A common stock - diluted
|
$
|
3.86
|
$
|
3.04
|
Earnings per share:
|
Nine Months Ended
June 30, 2022
|
Nine Months Ended
June 30, 2021
|
||||||
Numerator:
|
||||||||
Net income attributable to OneWater Inc.
|
$
|
112,293
|
$
|
62,765
|
||||
Denominator:
|
||||||||
Weighted-average number of unrestricted outstanding common shares used to calculate basic net income per share
|
13,791
|
10,884
|
||||||
Effect of dilutive securities:
|
||||||||
Restricted stock units
|
414
|
259
|
||||||
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted earnings per share
|
14,205
|
11,143
|
||||||
Earnings per share of Class A common stock - basic
|
$
|
8.14
|
$
|
5.77
|
||||
Earnings per share of Class A common stock - diluted
|
$
|
7.90
|
$
|
5.63
|
Three Months Ended
June 30, 2022
|
Three Months Ended
June 30, 2021
|
|||||||
Class B common stock
|
1,430
|
4,063
|
||||||
Restricted Stock Units
|
256
|
201
|
||||||
1,686
|
4,264
|
Nine Months Ended
June 30, 2022
|
Nine Months Ended
June 30, 2021
|
|||||||
Class B common stock
|
1,560
|
4,124
|
||||||
Restricted Stock Units
|
233
|
221
|
||||||
1,793
|
4,345
|
10. |
Fair Value Measurements
|
June 30, 2022
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
($ in thousands)
|
||||||||||||||||
Liabilities:
|
||||||||||||||||
Contingent Consideration
|
$
|
-
|
$
|
-
|
$
|
38,282
|
$
|
38,282
|
September 30, 2021
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||
($ in thousands)
|
||||||||||||||||
Liabilities:
|
||||||||||||||||
Contingent Consideration
|
$
|
-
|
$
|
-
|
$
|
12,072
|
$
|
12,072
|
($ in thousands)
|
Three Months Ended June 30, 2022
|
|||
Balance as of March 31, 2022
|
$
|
35,243
|
||
Additions from acquisitions
|
-
|
|||
Settlement of contingent consideration
|
(79
|
)
|
||
Change in fair value, including accretion
|
3,118
|
|||
Balance as of June 30, 2022
|
$
|
38,282
|
($ in thousands)
|
Nine Months Ended June 30, 2022
|
|||
Balance as of September 30, 2021
|
$
|
12,072
|
||
Additions from acquisitions
|
15,321
|
|||
Settlement of contingent consideration
|
(133
|
)
|
||
Change in fair value, including accretion
|
11,022
|
|||
Balance as of June 30, 2022
|
$
|
38,282
|
11. |
Income Taxes
|
12. |
Contingencies and Commitments
|
13. |
Leases
|
14. |
Related Party Transactions
|
Item 2. |
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
|
• |
Effective October 1, 2021, we acquired Naples Boat Mart, a full-service marine retailer with one location in Florida.
|
|
• |
Effective November 30, 2021, we acquired T-H Marine, a leading provider of branded marine parts and accessories, with locations in Alabama, Florida, Illinois, Indiana, Oklahoma and Texas.
|
|
• |
Effective December 1, 2021, we acquired Norfolk Marine Company, a full-service marine retailer with one location in Virginia.
|
|
• |
Effective December 31, 2021, we acquired a majority interest in Quality Boats, a full-service marine retailer with three locations in Florida.
|
|
• |
Effective February 1, 2022, we acquired JIF Marine, a leading supplier of stainless steel ladders, dock products and other accessories which is based in Tennessee.
|
|
• |
Effective March 1, 2022, we acquired YakGear, a leading supplier of kayak equipment, paddle sport accessories and boat mounting accessories which is based in Texas.
|
|
• |
Effective April 1, 2022, Denison Yachting, a leader in yacht and superyacht sales as well as ancillary yacht services, with 20 retail locations.
|
|
• |
Effective December 1, 2020, we acquired Tom George Yacht Sales, Inc, a full-service marine retailer based in Florida with two locations.
|
|
• |
Effective December 31, 2020, we acquired Walker Marine Group, Inc., a full-service marine retailer based in Florida with five locations.
|
|
• |
Effective December 31, 2020, we acquired Roscioli Yachting Center, Inc., a full-service marina and yachting facility located in Florida, including the related real estate and in-water slips.
|
|
• |
Effective August 1, 2021, we acquired substantially all of the assets of Stone Harbor Marine, Inc., a full-service marine retailer based in New Jersey with one store.
|
|
• |
Effective September 1, 2021, we acquired substantially all of the assets of PartsVu, an online marketplace for OEM marine parts, electronics and accessories.
|
|
• |
OneWater Inc. is subject to U.S. federal, state and local income taxes as a corporation. Our accounting predecessor, OneWater LLC, was and is treated as a partnership for U.S. federal income tax purposes, and as such, was generally not subject to U.S. federal income tax at the entity level. Rather, the tax liability with respect to its taxable income is passed through to its members. Accordingly, the financial data attributable to our predecessor contains no provision for U.S. federal income taxes or income taxes in any state or locality. OneWater Inc. was subject to U.S. federal, state and local taxes at an estimated blended statutory rate of 24.4% of pre-tax earnings for the nine months ended June 30, 2022.
|
|
• |
As we further implement controls, processes and infrastructure applicable to companies with publicly traded equity securities, it is likely that we will incur additional SG&A expenses relative to historical periods. Our future results will depend on our ability to efficiently manage our combined operations and execute our business strategy.
|
For the Three Months Ended
June 30, 2022
|
For the Three Months Ended
June 30, 2021
|
|
||||||||||||||||||||||
Amount
|
% of Revenue
|
Amount
|
% of Revenue
|
$ Change
|
% Change
|
|||||||||||||||||||
($ in thousands)
|
||||||||||||||||||||||||
Revenues
|
||||||||||||||||||||||||
New boat
|
$
|
376,886
|
66.2
|
%
|
$
|
288,222
|
71.3
|
%
|
$
|
88,664
|
30.8
|
%
|
||||||||||||
Pre-owned boat
|
98,181
|
17.3
|
%
|
71,116
|
17.6
|
%
|
27,065
|
38.1
|
%
|
|||||||||||||||
Finance & insurance income
|
18,979
|
3.3
|
%
|
15,238
|
3.8
|
%
|
3,741
|
24.6
|
%
|
|||||||||||||||
Service, parts and other
|
74,854
|
13.2
|
%
|
29,631
|
7.3
|
%
|
45,223
|
152.6
|
%
|
|||||||||||||||
Total revenues
|
568,900
|
100.0
|
%
|
404,207
|
100.0
|
%
|
164,693
|
40.7
|
%
|
|||||||||||||||
Gross Profit
|
||||||||||||||||||||||||
New boat
|
102,342
|
18.0
|
%
|
77,081
|
19.1
|
%
|
25,261
|
32.8
|
%
|
|||||||||||||||
Pre-owned boat
|
29,432
|
5.2
|
%
|
18,550
|
4.6
|
%
|
10,882
|
58.7
|
%
|
|||||||||||||||
Finance & insurance
|
18,979
|
3.3
|
%
|
15,238
|
3.8
|
%
|
3,741
|
24.6
|
%
|
|||||||||||||||
Service, parts & other
|
33,186
|
5.8
|
%
|
16,083
|
4.0
|
%
|
17,103
|
106.3
|
%
|
|||||||||||||||
Total gross profit
|
183,939
|
32.3
|
%
|
126,952
|
31.4
|
%
|
56,987
|
44.9
|
%
|
|||||||||||||||
Selling, general and administrative expenses
|
87,867
|
15.4
|
%
|
60,476
|
15.0
|
%
|
27,391
|
45.3
|
%
|
|||||||||||||||
Depreciation and amortization
|
4,073
|
0.7
|
%
|
1,475
|
0.4
|
%
|
2,598
|
176.1
|
%
|
|||||||||||||||
Transaction costs
|
1,337
|
0.2
|
%
|
65
|
0.0
|
%
|
1,272
|
*
|
||||||||||||||||
Change in fair value of contingent consideration
|
3,118
|
0.5
|
%
|
-
|
0.0
|
%
|
3,118
|
100.0
|
%
|
|||||||||||||||
Income from operations
|
87,544
|
15.4
|
%
|
64,936
|
16.1
|
%
|
22,608
|
34.8
|
%
|
|||||||||||||||
Interest expense - floor plan
|
1,131
|
0.2
|
%
|
956
|
0.2
|
%
|
175
|
18.3
|
%
|
|||||||||||||||
Interest expense - other
|
3,311
|
0.6
|
%
|
1,083
|
0.3
|
%
|
2,228
|
205.7
|
%
|
|||||||||||||||
Other income, net
|
(166
|
)
|
0.0
|
%
|
(158
|
)
|
0.0
|
%
|
(8
|
)
|
5.1
|
%
|
||||||||||||
Income before income tax expense
|
83,268
|
14.6
|
%
|
63,055
|
15.6
|
%
|
20,213
|
32.1
|
%
|
|||||||||||||||
Income tax expense
|
18,785
|
3.3
|
%
|
11,498
|
2.8
|
%
|
7,287
|
63.4
|
%
|
|||||||||||||||
Net income
|
64,483
|
11.3
|
%
|
51,557
|
12.8
|
%
|
12,926
|
25.1
|
%
|
|||||||||||||||
Less: Net income attributable to non-controlling interest
|
(959
|
) |
-
|
(959
|
) |
100.0
|
%
|
|||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC
|
(7,547
|
) |
(17,054
|
) |
9,507
|
|
-55.7
|
%
|
||||||||||||||||
Net income attributable to One Water Marine Inc.
|
$
|
55,977
|
$
|
34,503
|
$
|
21,474
|
62.2
|
%
|
For the Nine Months Ended
June 30, 2022
|
For the Nine Months Ended
June 30, 2021
|
|
||||||||||||||||||||||
Amount
|
% of Revenue
|
Amount
|
% of Revenue
|
$ Change
|
% Change
|
|||||||||||||||||||
($ in thousands)
|
||||||||||||||||||||||||
Revenues
|
||||||||||||||||||||||||
New boat
|
$
|
903,104
|
67.0
|
%
|
$
|
679,704
|
71.7
|
%
|
$
|
223,400
|
32.9
|
%
|
||||||||||||
Pre-owned boat
|
227,484
|
16.9
|
%
|
165,778
|
17.5
|
%
|
61,706
|
37.2
|
%
|
|||||||||||||||
Finance & insurance income
|
43,234
|
3.2
|
%
|
32,990
|
3.5
|
%
|
10,244
|
31.1
|
%
|
|||||||||||||||
Service, parts and other
|
173,477
|
12.9
|
%
|
69,429
|
7.3
|
%
|
104,048
|
149.9
|
%
|
|||||||||||||||
Total revenues
|
1,347,299
|
100.0
|
%
|
947,901
|
100.0
|
%
|
399,398
|
42.1
|
%
|
|||||||||||||||
Gross Profit
|
||||||||||||||||||||||||
New boat
|
244,058
|
18.1
|
%
|
158,884
|
16.8
|
%
|
85,174
|
53.6
|
%
|
|||||||||||||||
Pre-owned boat
|
63,406
|
4.7
|
%
|
40,212
|
4.2
|
%
|
23,194
|
57.7
|
%
|
|||||||||||||||
Finance & insurance
|
43,234
|
3.2
|
%
|
32,990
|
3.5
|
%
|
10,244
|
31.1
|
%
|
|||||||||||||||
Service, parts & other
|
76,748
|
5.7
|
%
|
36,088
|
3.8
|
%
|
40,660
|
112.7
|
%
|
|||||||||||||||
Total gross profit
|
427,446
|
31.7
|
%
|
268,174
|
28.3
|
%
|
159,272
|
59.4
|
%
|
|||||||||||||||
Selling, general and administrative expenses
|
222,455
|
16.5
|
%
|
143,685
|
15.2
|
%
|
78,770
|
54.8
|
%
|
|||||||||||||||
Depreciation and amortization
|
10,549
|
0.8
|
%
|
3,816
|
0.4
|
%
|
6,733
|
176.4
|
%
|
|||||||||||||||
Transaction costs
|
5,158
|
0.4
|
%
|
633
|
0.1
|
%
|
4,525
|
714.8
|
%
|
|||||||||||||||
Change in fair value of contingent consideration
|
11,022
|
0.8
|
%
|
377
|
0.0
|
%
|
10,645
|
*
|
||||||||||||||||
Income from operations
|
178,262
|
13.2
|
%
|
119,663
|
12.6
|
%
|
58,599
|
49.0
|
%
|
|||||||||||||||
Interest expense - floor plan
|
3,056
|
0.2
|
%
|
2,206
|
0.2
|
%
|
850
|
38.5
|
%
|
|||||||||||||||
Interest expense - other
|
7,937
|
0.6
|
%
|
3,222
|
0.3
|
%
|
4,715
|
146.3
|
%
|
|||||||||||||||
Other expense (income), net
|
491
|
0.0
|
%
|
(247
|
)
|
0.0
|
%
|
738
|
*
|
|||||||||||||||
Income before income tax expense
|
166,778
|
12.4
|
%
|
114,482
|
12.1
|
%
|
52,296
|
45.7
|
%
|
|||||||||||||||
Income tax expense
|
36,455
|
2.7
|
%
|
20,559
|
2.2
|
%
|
15,896
|
77.3
|
%
|
|||||||||||||||
Net income
|
130,323
|
9.7
|
%
|
93,923
|
9.9
|
%
|
36,400
|
38.8
|
%
|
|||||||||||||||
Less: Net income attributable to non-controlling interest
|
(1,970
|
) |
-
|
(1,970
|
) |
100.0
|
%
|
|||||||||||||||||
Less: Net income attributable to non-controlling interests of One Water Marine Holdings, LLC
|
(16,060
|
) |
(31,158
|
) |
15,098
|
|
-48.5
|
%
|
||||||||||||||||
Net income attributable to One Water Marine Inc.
|
$
|
112,293
|
$
|
62,765
|
$
|
49,528
|
78.9
|
%
|
Three months ended June 30,
|
||||||||
Description
|
2022
|
2021
|
||||||
($ in thousands)
|
||||||||
Net income
|
$
|
64,483
|
$
|
51,557
|
||||
Interest expense - other
|
3,311
|
1,083
|
||||||
Income tax expense
|
18,785
|
11,498
|
||||||
Depreciation and amortization
|
4,274
|
1,475
|
||||||
Change in fair value of contingent consideration
|
3,118
|
-
|
||||||
Transaction costs
|
1,337
|
65
|
||||||
Other income, net
|
(166
|
)
|
(158
|
)
|
||||
Adjusted EBITDA
|
$
|
95,142
|
$
|
65,520
|
Nine months ended June 30,
|
||||||||
Description
|
2022
|
2021
|
||||||
($ in thousands)
|
||||||||
Net income
|
$
|
130,323
|
$
|
93,923
|
||||
Interest expense - other
|
7,937
|
3,222
|
||||||
Income tax expense
|
36,455
|
20,559
|
||||||
Depreciation and amortization
|
10,814
|
3,816
|
||||||
Change in fair value of contingent consideration
|
11,022
|
377
|
||||||
Transaction costs
|
5,158
|
633
|
||||||
Other expense (income), net
|
491
|
(247
|
)
|
|||||
Adjusted EBITDA
|
$
|
202,200
|
$
|
122,283
|
Nine Months ended June 30, |
||||||||||||
Description
|
2022
|
2021
|
Change
|
|||||||||
($ in thousands)
|
||||||||||||
Net cash provided by operating activities
|
$
|
62,123
|
$
|
153,195
|
$
|
(91,072
|
)
|
|||||
Net cash used in investing activities
|
(337,616
|
)
|
(91,120
|
)
|
(246,496
|
)
|
||||||
Net cash provided by (used in) financing activities
|
313,443
|
(9,542
|
)
|
322,985
|
||||||||
Net change in cash
|
$
|
37,950
|
$
|
52,533
|
$
|
(14,583
|
)
|
Item 3.
|
Quantitative and Qualitative Disclosure about Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1. |
Legal Proceedings
|
Item 1A.
|
Risk Factors
|
|
• |
providing that all vacancies, including newly created directorships, may, except as otherwise required by law or, if applicable, the rights of holders of a series of preferred stock, only be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum;
|
|
• |
permitting any action by stockholders to be taken only at an annual meeting or special meeting rather than by a written consent of the stockholders, subject to the rights of any series of preferred stock with respect to such rights;
|
|
• |
permitting special meetings of our stockholders to be called only by our Chief Executive Officer, the chairman of our board of directors and our board of directors pursuant to a resolution adopted by the affirmative vote of a majority of the total number of authorized directors whether or not there exist any vacancies in previously authorized directorships;
|
|
• |
subject to the rights of the holders of shares of any series of our preferred stock, requiring the affirmative vote of the holders of at least a majority in voting power of all then outstanding common stock entitled to vote generally in the election of directors, voting together as a single class, to remove any of all of the directors from office at any time;
|
|
• |
prohibiting cumulative voting in the election of directors;
|
|
• |
establishing advance notice provisions for stockholder proposals and nominations for elections to the board of directors to be acted upon at meetings of stockholders;
|
|
• |
providing that the board of directors is expressly authorized to adopt, or to alter or repeal our bylaws; and
|
|
• |
On February 23, 2022, following shareholder approval at our 2022 annual meeting, we revised our certificate of incorporation and bylaws to eliminate our staggered board of directors and supermajority voting provisions.
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Item 3. |
Defaults Upon Senior Securities
|
Item 4. |
Mine Safety Disclosures
|
Item 5. |
Other Information
|
Item 6.
|
Exhibits
|
Exhibit No.
|
Description
|
Agreement and Plan of Merger, by and among Ocean Bio-Chem, Inc., OneWater Marine Inc. and OBCMS, Inc., dated as of June 21, 2022 (incorporated by reference to Exhibit 2.1 to the Registrant's Current Report on Form 8-K, File Number 001-39213, filed with the Commission on June 22, 2022).
|
|
Second Amended and Restated Certificate of Incorporation of OneWater Marine Inc. (incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K, File No. 001-39213, filed with the Commission on February 24, 2022).
|
|
Second Amended and Restated Bylaws of OneWater Marine Inc. (incorporated by reference to Exhibit 3.2 to the Registrant's Current Report on Form 8-K, File No. 001-39213, filed with the Commission on February 24, 2022).
|
|
*10.1¥
|
Equity Purchase Agreement, by and between One Water Assets & Operations, LLC, Peter G. Dornau and Maureen Dornau, dated June 21, 2022.
|
*10.2¥
|
Real Estate Sales Contract, by and between One Water Assets & Operations, LLC and PEJE, Inc., dated June 21, 2022.
|
Support Agreement, by and among the Ocean Bio-Chem, OneWater Marine Inc. and Peter Dornau, dated as of June 21, 2022 (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K, File Number 001-39213, filed with the Commission on June 22, 2022).
|
|
Support Agreement, by and among the Ocean Bio-Chem, OneWater Marine Inc. and Gregor M. Dornau, dated as of June 21, 2022 (incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K, File Number 001-39213, filed with the Commission on June 22, 2022).
|
|
Support Agreement, by and among the Ocean Bio-Chem, OneWater Marine Inc. and Peter Dornau Family LLC, dated as of June 21, 2022 (incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K, File Number 001-39213, filed with the Commission on June 22, 2022).
|
|
*31.1
|
Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
|
*31.2
|
Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
|
**32.1
|
Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
|
**32.2
|
Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
|
101.INS(a)
|
Inline XBRL Instance Document.
|
101.SCH(a)
|
Inline XBRL Schema Document.
|
101.CAL(a)
|
Inline XBRL Calculation Linkbase Document.
|
101.DEF(a)
|
Inline XBRL Definition Linkbase Document.
|
101.LAB(a)
|
Inline XBRL Labels Linkbase Document.
|
101.PRE(a)
|
Inline XBRL Presentation Linkbase Document.
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
|
ONEWATER MARINE INC.
|
||
(Registrant)
|
||
|
||
By:
|
/s/ Philip Austin Singleton, Jr.
|
|
Philip Austin Singleton, Jr.
|
||
|
Chief Executive Officer |
By:
|
/s/ Jack Ezzell
|
|
Jack Ezzell
|
||
Chief Financial Officer
|
||
August 5, 2022
|