Malibu Boats, Inc.

Good morning and welcome to Malibu Boats conference call to discuss the first quarter fiscal year 2025 results. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session and instructions will follow at that time. Please be advised that reproduction of this call in whole or in part is not permitted without written authorization of Malibu Boats. And as a reminder, today's call is being recorded. On the call today from management are Mr. Steve Minetto, Chief Executive Officer, Mr. Bruce Beckman, Chief Financial Officer, and Mr. Richie Anderson, President. I will turn the call over to Mr. Beckman to get it started. Please go ahead, sir.

Thank you, and good morning, everyone. Joining me on today's call is our CEO, Steve Minetto. On the call, Steve will provide commentary on the business, and I will discuss our first quarter of fiscal year 2025 financials. We will then open the call for questions. A press release covering the company's fiscal first quarter 2025 results was issued today, and a copy of that press release can be found in the investor relations section of the company's website. I also want to remind everyone that management's remarks on this call may contain certain forward-looking statements, including predictions, expectations, estimates, and other information that might be considered forward-looking, and that actual results could differ materially from those projected on today's call. You should not place undue reliance on these forward-looking statements, which speak only as of today. and the company undertakes no obligation to update them for any new information or future events. Factors that might affect future results are discussed in our filings with the SEC, and we encourage you to review our SEC filings for a more detailed description of these risk factors. Please also note that we will be referring to certain non-GAAP financial measures on today's call. such as adjusted EBITDA, adjusted EBITDA margin, adjusted fully distributed net income, and adjusted fully distributed net income per share. Reconciliations of GAAP financial measures to non-GAAP financial measures are included in our earnings release. I will now turn the call over to Steve. Steve?

Thank you, Bruce. Thank you all for joining the call. Before we dive into the results, I would like to comment on the hardships caused by the two hurricanes. Our heart goes out to all those affected. At Malibu, the safety of our people, customers, dealers, and communities is always paramount. Our Fort Pierce facilities experienced some delays, but we have implemented measures to minimize any disruptions to production and distribution. However, some of our partners have asked to delay shipments for a short amount of time as they work through operational challenges. We have incorporated that into our plans and expect no impact on our outlook for the fiscal year. Turning to the first fiscal quarter, as expected, we navigated a challenging market environment driven by continued macroeconomic factors and slower retail demand. Net sales decreased by approximately 33% year-over-year as we maintained our focus on reducing channel inventories. While we are encouraged by the recent move in interest rates, we will need a sustained cycle of rate cuts to bring back payment buyers into the market. Retail demand remains challenging and will likely remain challenging until payment buyers return to the market. As stated, our key focus has been on maintaining disciplined control over dealer inventories by adjusting production levels. As expected, Few ones showed sequential improvements in inventory alignment compared to quarter four, positioning us well for the coming quarters. In addition, our margin performance in the first quarter also improved compared to prior quarter, which aligned with our expectations as promotional support returned to more normalized levels. This tailwind, coupled with our resilient business model highlighted by our variable cost structure, enables us to adapt quickly to changing market conditions and maintain financial stability. Adding to the stability of our business, we are bringing the Tommies Matters to closure. The trustee has liquidated nearly all of the remaining New Malibu and Access inventory. As mentioned in prior discussions, our newly authorized dealers are up and running, selling boats and providing great service to our customers. And following the legal settlement announced earlier this month, which covers all impacted locations, we are now turning our full attention to supporting our dealers in restoring and ultimately improving our market share in these important markets. Turning to our model year 25, we are excited to enter the boat show season, where we will showcase our newest models, including the recently launched all-new Malibu M230 and the Cobalt R31. The all-new M230 exemplifies our commitment to luxury and advanced functionality. This model features the state-of-the-art Malibu command center enhanced with the new Malibu operating system, which allows for seamless wave control and preset water sport options. Other notable design elements include the easy stash board locker and max relax sun deck catering to both casual users and serious water sport enthusiasts. We are also thrilled to introduce the all-new Cobalt R31, the latest addition to our Cobalt lineup. This luxury day boat is designed to embody the exceptional quality and innovative features that have become the hallmark of the Cobalt brand. We look forward to showcasing our lineup at the Fort Lauderdale International Boat Show. Early feedback from dealers has been very positive, reinforcing our confidence in our industry-leading innovation further solidifying our leadership in premium features and customer experience. Separately, as a testament to our industry-leading innovation, we are pleased to announce that our 2024 Malibu Wake Center 23 LSV has once again been recognized by Wake World Riders Choice Awards as Wake Surf and Wake Board Boat of the Year, marking the fifth consecutive year we have received this honor. This award reflects our consistent delivery of performance and quality that our customers have come to expect, reinforcing our leadership position in the Tobo segment. We can continue to see positive market share gains across our brands. On a trailing 12-month basis through June, Cobalt continues to gain share, led by our Stern Drive segment, gaining 200 basis points. Within Cobalt's 22 to 24-foot model segment, which are now being produced in our new Rowan County, Tennessee facility, we have gained over 250 basis points of share. And lastly, Pathfinder, which is represented by our bay boat segment, has gained 400 basis points of share. We continue to make great strides in our vertical integration initiatives. Recently, we completed the move of Malibu Electronics and are now fully producing wiring harnesses out of our new Rowan County facility. This fully integrated and consolidated footprint enhances our operational efficiency and positions us for the growth as market conditions recover. As we discussed two months ago, we have taken the necessary actions to reset the business. Therefore, we are maintaining our full-year guidance. Healer inventory levels are aligned with historical averages, allowing us to better align wholesale shipments with retail demand. Our capacity expansion projects are also complete. giving us the ability to increase shipments to the retail market return to growth sooner than anticipated. We expect to see sequential improvement throughout the year in the top and bottom lines as wholesale shipments pick up. As I continue to engage more deeply with the business, I am pleased to announce that we are planning to host an investor day in calendar year 2025. At this event, we will discuss our long-term strategy and outline our approach to sustained growth, operational excellence, and product innovation. I look forward to sharing more details soon and am excited about the future of our business. I will now turn the call over to Bruce for further remarks on the quarter.