Malibu Boats, Inc.

Malibu boats conference call to discuss second 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 if you require operator assistance please press star then zero. On the call today from management are Mr. Steve Minetto, Chief Executive Officer, and Mr. Bruce Beckman, Chief Financial Officer. I will now turn the call over to Mr. Beckman to get it started. Please go ahead.

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 second quarter of fiscal year 2025 financials. We will then open the call for questions. A press release covering the company's fiscal second 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 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 these 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, and thank you all for joining the call. Our second fiscal quarter results came in slightly higher than expected during what has been a traditionally slower time of year. However, the broader retail marine market trends remain more challenging than we initially forecasted for the full year. While the quarter benefited from a favorable mix in our Malibu access segment and strong ASP performance, indicators of demand are below our original assumptions. During the quarter, we continued to navigate this challenging market environment, which we attribute largely to the muted retail demand driven by sustained interest rate pressures coupled with lagging effects on consumer purchases stemming from the hurricane season. As a result, The market is tracking down low double digits year to date, which is below the mid single digit decline we had originally planned for. Retail softness is particularly evident in saltwater due to the lingering regional impacts in Florida. Overall, net sales in the quarter decreased by approximately 5.1% year over year due to our focus on maintaining modest production levels in line with lower channel inventories. Discipline production and lower channel inventories will continue to be our focus for the remainder of the fiscal year as we prioritize dealer health and brand strength. Shifting to the early season boat shows, as many of you all know, these events provide important insights into customers' willingness to purchase new feature-rich models, and we had the opportunity to showcase our 2025 lineup across our brands. Dealer enthusiasm for these introductions reaffirmed our confidence in our commitment to staying on the leading edge of innovation, which continues to set us apart. Results in the early season shows have been decent, but do not suggest a strong rebound in retail activity heading into the second half of the year. We will continue to watch closely as we head into the February Miami Boat Show for major signals within the saltwater segment and remain disciplined until we see firmer evidence of improvement in the market. Along with the early season shows, our Malibu Access year-end sales event, a tradition we've maintained for 15 years, wrapped up earlier in the quarter. We were encouraged by the higher overall retail sell-through and good participation compared to last year with moderating levels of promotional support required. This continues to underscore the strength of our brands and how they continue to resonate with customers in the current environment. However, it is important to note that while this activity is positive, many dealers focused on moving non-current units, a sign that inventory discipline remains top of mind across the channel. As we look ahead, we recognize that a sustained softening in the market, especially in saltwater, will likely continue in the second half of the fiscal year. While we do anticipate some seasonal lift, it is unlikely to lift the market enough to align with our original market assumption for a mid single digit decline for the year. Therefore, we are adjusting our outlook to reflect the reality of weaker retail trends with top line sales expected to be flat to down low single digits for the year and adjusted EBITDA margins to reflect approximately 10%. As I stated earlier, our focus remains on maintaining dealer health and not prematurely ramping production without a clear path. Meeting demand as it materializes and preserving our brand position in the long term will set us up for success as we continue to monitor the retail environment. Overall, I am confident in our team's ability to weather these market conditions with our emphasis on dealer health and commitment to innovation and positioning us to thrive when demand normalizes. I will now turn the call over to Bruce for further remarks on the quarter.