Boating Industry

July 2014

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LAUNCH 12 | Boating Industry | July 2014 www.BoatingIndustry.com MERCURY'S MARK SCHWABERO NAMED BRUNSWICK PRESIDENT, COO Brunswick Corp. announced Mark Schwabero, president of Mercury Marine, has been promoted to the newly created position of president and chief operating officer of Brunswick. In his new role, Schwabero will report to chairman and CEO Dusty McCoy. Schwabero, most recently president of Brunswick's Mercury Marine engine segment, will be succeeded by John C. Pfeifer, who had been vice president – global operations for Mercury Marine. These promotions are effective immediately. As part of this action and to further facilitate the company's long-term suc- cession process, Brunswick Boat Group President Andrew E. Graves will be leav- ing the company. Graves' direct reports — Jeff Behan, vice president — planning and business development; Boston Whaler President Huw Bower, Freshwater Group President Jeff Kinsey, and Recreation Boat Group President Tim Schiek — will now report to Schwabero. In his new position, Schwabero will be responsible for all of Brunswick's day-to-day operations, with the leadership of its four business segments — Engine, Boat, Fitness and Bowling & Billiards — reporting to him. "An important responsibility of our Board of Directors is to ensure that we have a deep and robust succession process. To- day's announcement reflects the quality of that process," McCoy said. "Mark is an accomplished executive who is intimately fa- miliar with Brunswick's markets, particularly those in the marine segment from which the company derives the majority of its sales and earnings. The role of chief operating officer positions Mark to better learn and actively manage Brunswick's overall operation, and each of its business segments and to develop and execute our strategic imperatives. "John Pfeifer is taking the helm of a Mercury Marine organiza- tion that is strong and vibrant and building upon the momentum of a number of recent new products and engine innovations," McCoy said. "John has been an integral member of Mercury's leadership team, helping to fashion an energized organization that is setting the pace in today's global marine marketplace. "In conclusion, the fact that we can adopt and staff such an organization structure totally from within our management ranks is testimony to the depth, talent and bench strength that we have fashioned through the years at Brunswick," McCoy continued. "We will miss Andy Graves, and we wish him the best and thank him for his contributions. He leaves behind a Boat Group that is better prepared and positioned to continue to prosper in this evolving and challenging marine market environment." performed very well and our new product introductions continued to create a lot of excitement with our dealers and customers. The proof was in our adjusted EBITDA margin, which increased to a third quar- ter record of 20 percent. This is the highest third quarter margin in the company's history and we continue to take a balanced approach to driving profitable growth." WEST MARINE Also echoing challenges from lingering cold weather, West Marine re- ported its net revenue decreased 0.8 percent to $113.3 million compared to last year for the quarter ending March 29. Despite the first quarter results, the company reaffirmed its 2014 full-year pre-tax guidance, with pre-tax income expected to be in the range of $16 million to $18.5 million, compared to pre-tax income of $15.3 million for 2013. West Marine's comparable store sales decreased by 1.7 percent dur- ing the quarter, and its pre-tax loss was $19.2 million, compared with a pre-tax loss of $16.3 million last year. "These weak results were partially offset by gains in wholesale sales, solid growth in the regions where spring weather has been more typi- cal and continued success of our growth strategies," said CEO Matt Hyde. "Despite the tough quarter, we remain optimistic with the posi- tive results from our strategies and will continue to invest in them as we reposition to be less dependent on weather influences." MARINEMAX In a presentation dominated by the negative effects of the winter sea- son, MarineMax announced a 16-percent drop in same-store sales and a net loss of $20 million during its second quarter fiscal 2014 results. Revenue was $136.6 million for the quarter ended March 31, 2014 compared with approximately $160 million for the comparable quar- ter last year. Same-store sales declined approximately 16 percent, pri- marily due to weather, following two consecutive March quarters of double-digit percentage same-store sales growth on a year-over-year basis. The company reported a net loss of less than $2 million, or $0.08 per share for the quarter compared to a net income of $344,000, or $0.01 per share, for the comparable quarter last year. Chairman, president and CEO Bill McGill, Jr., opened the call by saying "for sure, this turned out to be a lot more challenging quarter than we expected." MarineMax's revenue decreased 5 percent to $246.2 million for the six months ended March 31 compared with $259.1 million for the comparable period last year. Same-store sales decreased approximately 6 percent as compared to a 10-percent increase in the comparable pe- riod last year. The company's net loss for the six months ended March 31 was $5.3 million, or $0.22 per share, compared with a net loss of $3.8 million, or $0.17 per share, for the comparable period last year. Looking ahead to the next quarter, McGill predicted that a healthy inventory might aid the company if the previous quarter's pent-up demand translates into higher sales during the coming months. Continued from page 9 MARK SCHWABERO P08x12-BI14JUL-Launch.indd 12 5/28/14 11:33 AM

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