1. Archive


Sales are down, but the forecast isn't entirely gloomy.

The boating industry is taking on water, and two of its kingpins say the drubbing isn't over.

Brunswick Corp. of Lake Forest, Ill., the country's largest recreational-boat manufacturer, warned Thursday that U.S. consumers may buy only 260,000 power boats this year, the fewest since at least 1965. Clearwater-based MarineMax Inc., the country's largest recreational-boat retailer, said it doesn't expect 2008 to be much better.

Both companies blamed their disappointing performance during the April-to-June quarter on external factors that discourage luxury consumption, including rising interest rates, gas prices and food costs. MarineMax, which earns close to half of its revenues within Florida, said its key problem is the state's weakened housing market.

"When consumers aren't confident in their outlook and their financial well-being, they're probably not going to be plunking down anywhere from $30,000 to half-a-million dollars on a boat," Kathryn Chieger, Brunswick's vice president of corporate and investor relations, said in an interview. "And if one of their major investments, a house, is losing value, that doesn't help."

In the space of a year, MarineMax's sunny outlook has dimmed. The company expects to earn 55 to 65 cents per share in 2007, far below its original forecast of $2.15 to $2.25. Ten of the 12 Wall Street analysts who monitor its stock rate it a "hold." Since mid May, chairman and CEO William McGill Jr. has reduced his personal stake by about 330,000 shares, or roughly 20 percent. Meanwhile, the company's stock is a favorite among short sellers, who bet that a stock's price will fall steeply.

Neither company will need to summon the Coast Guard for help any time soon. Brunswick, atop the food chain in a $39-billion-a-year industry, continues to draw power from a strong international division. MarineMax remains profitable and says it is taking advantage of the downturn by grabbing market share from smaller, weaker competitors. Both companies can draw comfort that while unit sales of boats may soon hit a four-decade low, Americans continue to buy ever bigger and pricier models.

In fact, on Thursday, a day when most U.S. and Tampa Bay area stocks fell -- including Brunswick's, which slipped 3 percent to $28.54 per share - MarineMax's rose 6 percent, to $19.61.

Scott Barancik can be reached at or (727) 893-8751.


MarineMax Inc.

Same-store sales fell nine percent during the quarter ended June 30 at the Clearwater-based company, the country's largest recreational-boat retailer. Of the company's earnings per share of 73 cents, 23 cents stemmed from the one-time sale of a corporate plane, a state tax award, and an insurance payout.

3rd Qtr Yr Ago

Revenue $380-mil $421-mil

Net Income $13.9-mil $17.5-mil

Per Share 73 cents 90 cents