Gerrick Johnson

Gerrick Johnson inquired about the strong performance of Brunswick's propulsion segment, with outboard sales up 26% and the boat business up 11%, inferring significant expansion in sales to OEM customers. He asked for details on this growth, distinguishing between contributions from existing customers and new wins.

Answer

Chairman and CEO David Foulkes and CFO Ryan Gwillim explained that Mercury is gaining market share, particularly in Europe, and has secured multi-year (some 5-year) exclusive supply agreements with large and fast-growing OEMs. They emphasized Mercury's strategy of fortifying share through these agreements, driven by best-in-class products and technology. David Foulkes mentioned hiring 60 new Mercury engineers in 2025 and having five new outboard programs underway. Ryan Gwillim added that engine pipelines at both dealer networks and OEMs are at historical lean levels, with mid-20,000 engines taken out of U.S. pipelines in 2024 and another 10% in 2025, leading to strong OEM demand.

Gerrick Johnson asked for more details on the encouraging early boat shows (excluding Fort Lauderdale), specific regions, and segments. He also inquired about the impact of losing Sunday at the New York boat show on the second quarter and the effect of the government shutdown on consumer demand during the quarter.

Answer

CEO William Brett McGill stated that positive sentiment was observed across various markets and shows, indicating good momentum for the spring selling season. He noted that while losing a day at a show has effects, it often balances out. Both CEO William Brett McGill and CFO Michael McLamb agreed that news like a government shutdown creates a 'start-stop' effect on consumer demand due to uncertainty, likely having a negative impact.

Gerrick Johnson with Seaport Research Partners asked for deeper insights into the encouraging performance of recent boat shows (excluding Fort Lauderdale), seeking details on specific regions and segments, the impact of losing a day at the New York show, and the effect of the government shutdown on consumer behavior during the quarter.

Answer

CEO William Brett McGill stated that positive sentiment was observed across various boat shows in different markets, indicating good momentum for the spring selling season. He acknowledged that losing a day at the New York show has effects but usually balances out. Both executives agreed that external news like a government shutdown creates a "start-stop" effect on consumer demand, causing temporary slowdowns in buying trends.

Gerrick Johnson from Seaport Research asked if OneWater Marine experienced any adverse impact from the government shutdown during the quarter and whether there's evidence of the "monthly payment buyer" returning during the early boat show season.

Answer

Austin Singleton, Executive Chairman, and Jack Ezzell, CFO, confirmed no adverse impact from the government shutdown. Jack Ezzell, CFO, noted that over 60% of their premium customers finance purchases, which is consistent with historical trends. Anthony Aisquith, CEO, clarified that the "monthly payment buyer" typically seeks value products, a segment OneWater Marine does not heavily focus on.

Gerrick Johnson asked if the company experienced any adverse impact from the government shutdown during the quarter. He also questioned whether there was any evidence of the monthly payment buyer returning during the early season boat shows.

Answer

Austin Singleton, Executive Chairman, and Jack Ezzell, CFO, confirmed that there was no adverse impact from the government shutdown. Jack Ezzell, CFO, and Anthony Aisquith, CEO, explained that while a majority of their premium customers finance purchases (60%+), they are not typically 'payment buyers' in the sense of being highly price-sensitive. They noted that the low-end, price-sensitive consumers who are more focused on monthly payments tend to gravitate towards value products, which OneWater Marine does not sell in large volumes.