MarineMax, Inc. (HZO) Q2 2024 Earnings Report, Transcript and Summary

Good morning, and welcome to MarineMax, Inc Fiscal 2024 Second Quarter Conference Call. Today's call is being recorded. [Operator Instructions] At this time, I would like to turn the call over to Scott Solomon of the company's Investor Relations firm Sharon Merrill Advisors. Please go ahead, sir.

Good morning, and thank you for joining us. Hosting today's call are Brett McGill, MarineMax's President and Chief Executive Officer, and Mike McLamb, the company's Chief Financial Officer. Brett will begin the call by discussing MarineMax's operating highlights. Mike will review the financial results. And then management will be happy to take your questions. The earnings release and supplemental presentation can be found at investor.marinemax.com. With that, I'll turn the call over to Mike.

Thank you, Scott. Good morning, everyone, and thank you for joining this call. I'd like to start by reminding you that certain of our comments are forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Any forward-looking statements speak only as of today. These statements involve risks and uncertainties that could cause actual results to differ materially from expectations. These risks include but are not limited to the impact of seasonality and weather, global economic conditions and the level of consumer spending, the company's ability to capitalize on opportunities or grow its market share, and numerous other factors identified in our Form 10-K and other filings with the Securities and Exchange Commission. Also on today's call, we will make comments referring to non-GAAP financial measures. We believe that the inclusion of these financial measures helps investors gain a meaningful understanding of the changes in the company's core operating results. These metrics can also help investors who wish to make comparisons between MarineMax and other companies on both a GAAP and a non-GAAP basis. A reconciliation of non-GAAP financial measures to the most directly comparable GAAP measures is available in today's earnings release. With that, let me turn the call over to Brett. Brett?

Thank you, Mike. Good morning, everyone, and thanks for joining us. Before we get into the specifics of the quarter, let me acknowledge the dedication and commitment of our team in what continues to be a challenging period for the marine industry and indeed for the outdoor recreation market in general. Across our retail dealerships, superyacht operations, marinas and manufacturing locations, our team has worked hard to deliver on our high standards for product and service excellence, ensuring customers experience all of the terrific benefits of the boating lifestyle. Moving to our March quarter. We posted solid revenue of more than $582 million, driven mainly by higher boat sales and positive contributions from the IGY portfolio and the other marinas in our network. Our gross margin, while historically high, came in a bit below where we expected. This was primarily driven by more aggressive promotional activity designed to create consumer urgency given the economic environment and increased seasonality. From an industry perspective, demand was weaker than we had anticipated, with U.S. powerboat registrations posting year-over-year decline through the first 3 months of the calendar year. That being said, our strategy around premium brands combined with our promotional initiatives and customer focus enabled us to drive positive same-store sales growth and modest unit growth in Q2. Although we were not able to close all of the revenue we had anticipated in the quarter, we performed well on the top line in comparison with the industry as a whole. We are continuing to receive increasing support from our manufacturing partners, both from the perspective of incentives and in moderating production levels in response to the retail environment. Our industry is cyclical, but we have a track record of emerging from these troughs even stronger than when we went into them, and I am confident that will continue to be the case. Despite the sluggishness of near term retail demand, interest in boating is robust as evidenced by online activity on our events and boat shows. The Miami International Boat Show in February and the West Palm Beach International Boat Show in March were both strong events for us, generating positive momentum as we move into the summer selling season. We continue to prioritize growth through the addition of strong businesses that fit our acquisition criteria. During the quarter, we completed the acquisition of Williams Tenders USA. This grants MarineMax distribution exclusivity in the United States and the Caribbean for the world's leading brand of rigid inflatable jet tenders for the luxury yacht market. This transaction is consistent with our strategy of investing in brands, products and services that improve the customer experience and increase our margin profile. In March, we also announced the expansion of our footprint in the Florida Keys with Native Marine, a Boston Whaler and Mercury Marine dealer in Islamorada. We're excited to provide the dealership's customers with our broad range of products and services, including maintenance, repairs, boating accessories, and events. Let me address 2 items that occurred since we spoke with you on our Q1 call in January. First, as previously disclosed, in March, we determined that the company had experienced a cybersecurity incident. I'm extremely proud of our technology team and the efficiency with which they handled the incident. Although the containment measures that we put in place resulted in some disruption to a portion of our business, we quickly initiated our incident response and business continuity protocols and took immediate steps to contain the incident. The training and preparedness of our team played a significant role in the effectiveness of the response. While our investigation into the incident continues, to date, there has been no material long-term impact on our operations. Secondly, last week we filed an 8-K regarding what we consider to be the unlawful taking of our Marina operations at Cabo San Lucas, Mexico. The Marina has been operated by a subsidiary of IGY for more than 20 years. Our IGY team was in the process of finalizing a new renewal agreement with Mexican officials when the Marina was taken without notice. In light of the ongoing situation, we can't comment beyond the information contained in the 8-K, except to say that we are pursuing the appropriate remedies. The Cabo Marina accounted for less than 4% of assets and 1% of revenue in fiscal 2023. Before I conclude, let me touch on some very important operational improvement plans we are working on. While we have taken steps in recent months to reduce expenses in the areas that do not directly impact our customer experience, we believe it's prudent to take additional actions to align our cost structure with the current environment and improve our operating leverage. We began taking more significant actions which cover a broad range of expense reductions. We continue to maintain a strong cash position and a healthy balance sheet, positioning our business well as industry conditions improve. And with that, I'll turn the call over to Mike for comments on our financial performance in the quarter. Mike?

Thank you, Brett. Brett noted the overall decline in boat registrations through the first calendar quarter of 2024. We had anticipated registrations coming in flat or perhaps up slightly as noted on prior calls given the rather easy year-over-year comparisons, which is in stark contrast to the nearly 16% decline in fiberglass boat registrations for the period. Having said that, our own data suggest that seasonality may be partly contributing to recent industry trends. As an example, in the first half of fiscal 2024, the sales mix between our Florida and non-Florida retail locations closely resembled the mix we experienced prior to 2020, indicating more seasonal patterns in northern markets. Overall, revenue grew 2% to more than $582 million, primarily reflecting a 2% increase in same-store sales. Our same-store sales growth was driven mostly by modest unit growth. Our manufacturing businesses of cruisers, yachts and Intrepid Powerboats experienced revenue declines as they adjusted production, like other manufacturers in the industry. Gross profit margin declined to 32.7%. While we did expect to decline around this magnitude, the final results were lower than expected given the discounting needed to drive sales. SG&A increased to $169 million in the quarter. Excluding transaction costs, changes in contingent consideration, weather events and other nonrecurring items in both periods, SG&A increased approximately $16 million or 11%. The increase in expenses is in a number of areas, including compensation, inventory, maintenance, marketing, insurance and other factors related to the current inflationary environment. Also, roughly $3 million of the increase was from entities we did not own last March quarter. These entities are also seasonally slowest in the winter quarters. However, as Brett noted, we're taking more aggressive steps to offset those increases and the scope of what we are considering is broad. The goal is to improve our SG&A operating leverage and ultimately improve our operating margin. Some of our actions will be near-term reductions while others will take more time. Because we are still working through our actions, we plan to talk in more detail about these initiatives on our third quarter call. Interest expense increased to $19.4 million as a result of higher rates and increased inventory. Floor plan interest in the quarter was close to $12 million compared to $6.5 million last year. On the bottom line, GAAP net income was $1.6 million or $0.07 per diluted share compared with net income of $30 million or $1.35 per diluted share last year. Adjusted net income was $4.1 million or $0.18 per diluted share compared with $27.4 million or $1.23 per diluted share last year. Adjusted EBITDA for the quarter was $29.6 million compared with $57.4 million last year, primarily reflecting lower gross margins, higher SG&A and higher floorplan interest expense. Moving on to the balance sheet. We ended the quarter with nearly $217 million in cash. Inventories of $933 million were up about 6% from calendar year-end, generally in line with historical trends, but a bit higher than we expected given some revenue that we were unable to close in the quarter. On a same-store basis, unit inventories are over 26% below 2019 levels. Turning to liabilities. Our short-term borrowings, which is our floorplan financing, were up largely due to increased inventories. Customer deposits were up modestly as expected from calendar year-end as we move into the seasonal selling period. Debt to EBITDA net of cash was a little over 1x at quarter-end as we continued to maintain a strong liquidity position. We have additional liquidity in the form of unlevered inventory and available lines of credit totaling close to $200 million. Turning to guidance. Based on our year-to-date results and expectations for the remainder of the year, we are adjusting our 2024 guidance. Our expectations are based on an incrementally improving second half of the year, with increased seasonality playing a role. Although we are now forecasting industry volume to be down on a unit basis for our fiscal year, we expect our volume to be up modestly for the period consistent with what we've experienced in the first half of the fiscal year. For the year, we anticipate same-store sales growth in the low- to mid-single digit range and gross margins remaining in the low 30s on a percentage basis. We expect SG&A expenses to be elevated above our 2023 level given our year-to-date performance, but with the year-over-year increase moderating in the back half as we implement additional cost reduction actions. Interest expense will be on a run rate basis, generally consistent with the first 2 quarters of this fiscal year. Based on those drivers, we now expect our adjusted net income per share to be in the range of $2.20 to $3.20 for fiscal 2024, with adjusted EBITDA to be in the range of $155 million to $190 million. We are using an annual expected tax rate of just over 27% and a share count of 23.1 million in our assumptions. The wide range on EPS versus EBITDA is because our noncash items like stock based comp and depreciation and amortization grow more meaningfully as a percentage. Looking at current trends, we commented a few times that we did not close all the business we expected in March. That does set up for a strong April. But we have a lot of work to do to get things wrapped up. And trends in general have picked up presumably in part due to seasonality. With that, I will turn the call back over to Brett for closing comments. Brett?

Thank you, Mike. Although our industry continues to experience near-term challenges, combined with the return to seasonality, we have outperformed the market and are focused on the strategic steps necessary to maintain our historically strong margin profile and the financial flexibility to deliver on our strategic priorities. With that, Mike and I'll be happy to answer your questions. Operator, please open the line for Q&A.

[Operator Instructions] Our first question is from Drew Crum with Stifel.

So Mike, you addressed the variance in terms of guidance for earnings and EBITDA. Can you talk about why the updated guidance range for those 2 metrics has widened versus 3 months ago? And then I have a follow up.

Yes. And a good question. As our earnings -- as our GAAP earnings are lowering, the noncash items don't lower. They stay virtually flat year-over-year, stock-based -- not year-over-year, but they stay virtually flat in the guidance. So depreciation and amortization and stock-based comp. So those 2 items are growing as a percentage of the overall earnings. So that's what's driving that.

Okay. Okay. Maybe shifting gears just on gross margin. You talked a little bit about this, but I want to get a sense as to the level of promo spend you're anticipating for the selling season. How you see that impacting gross margin over the balance of fiscal '24? And kind of related, do you believe boat margins have bottomed here?

Yes, Drew, I'll comment. This is Brett. Yes, I think that the promotional activity, the discounting, the extra level of actions at boat shows, I think we're going to see -- we're going to keep pressing the pedal and kind of see that same thing running into the selling season here. Obviously, keeping an eye on the products that we need to move. And some boats are still in high demand and maybe not much in inventory. So to take advantage of those opportunities. We do feel like -- we're feeling like the margins are -- have found their bottom. We want to continue to work with our manufacturers to get the right support from them, and they are all working towards that. But maybe a little more margin pressure on some units. But we feel like we found kind of the historical norm. Mike, do you want to comment on...

Yes. No -- yes, margins are back at historical levels in the industry at least based on what we're seeing. And Drew, just to be -- just to help you from our guidance perspective, last quarter we said low to mid-30s is where we expected our gross margin to settle. This quarter, we are saying low 30s. And it's a question of splitting hair, is -- what we just posted, is that low to mids or is that closer to lower? So you can call it closer to lower, which is why we kind of brought it down a little bit for the back half of the year.

Our next question is from the line of James Hardiman with Citi Group.

This is Sean Wagner on for James. Kind of piggybacking on that last question and that last answer, can you give us some color on how much the OEMs are contributing to the -- or helping you out with the promotional environment? Do you think that margins have bottomed? When do you kind of see the promotional environment subsiding? Or is this kind of here to stay?

From a promotional standpoint, we're always pressing hard with the manufacturers. We have our pulse, right, on the frontline of the retail. And so that's our job to get to them and say, "Hey, we're seeing some softness on this model. We need a little more help." And they're always responding. But sometimes the lag between what you see in retail and their ability. But they're all very cooperative. We're working hard. I'd say that they're at the right levels, maybe a little more and a little quicker as we enter the selling season here. And -- but margin comments, Mike, go ahead.

Yes. I would tell you just with the industry data. So I think we've been on record expecting the industry to have positive year-over-year comps. October, November, December, January, February, March, of those 6 months, only 1 has been positive, which was October, if I remember right. I mean, if that's the case, that's got to be making other dealers out there not feel all that good, probably putting pressure on their manufacturers to increase incentives. I would assume that while -- I think all manufacturers are doing -- they're all doing what they need to be doing. With the trend in March and the trends in the March quarter, they'll probably get a little more aggressive as we go into the summer selling season. They want dealers to be in a very good inventory position as we get in midpoint of the summer because they're thinking about model year 2025, which starts for most manufacturers July 1. And if dealers have too much inventory, they won't order as much products the manufacturers want them to order. So my guess is there could be some increased promotional activity given the recent industry data by a lot of manufacturers out there.

Okay. And kind of tacking on to that, in the segments that you guys are focused on, where do you see the most kind of -- across the industry the most, I guess, inventory overhang or need for support like that?

I'd comment from an industry perspective. I think it's been well documented around towboats in the industry and even pontoon boats in the industry. But I'd probably say just given the softness in the last 6 months, it's broader than that. I would tell you it's no longer a segment type discussion. The industry has experienced softer retail than I think most people expected. So the elevated inventory is across most categories in the industry. There's exceptions on a brand by brand basis for sure. There are some brands that we carry that are in phenomenal shape. There are some brands that we carry that we're working closely with the manufacturers on, on both promotional activity as well as on orders, so. The good news is -- this is a comment on our manufacturers, but I think it's also a comment across the industry that the manufacturers really all want to see a healthy industry and healthy inventory levels. I think they have goal congruency with the dealers. And I think they're probably a little surprised by the retail activity in the last 6 months also.

Next question is from the line of Joe Altobello with Raymond James.

I just want to go back to the promo environment. And I know it's been a while since we've seen a normal promotion season, if you will. But is this kind of normal? Is this what the industry looked like really before COVID? And it just feels a lot more aggressive given we've come off a period where there was very little promotion going on.

Yes, I think it's probably right, Joe. A little memory -- we always had programs at certain times of the year. We're seeing that same thing. It probably just feels like we haven't seen them in a few years. But I'd say this feels historically normal to us.

Got it. Okay. And then in terms of SG&A, you talked about the items that kind of drove that increase year-over-year. I guess, first, what surprised you on the SG&A front? And maybe second, where do you see -- and I know you're going to talk about some of the savings, I guess, on the next call. But where do you see the biggest opportunities on the SG&A front?

I guess if I'd say a surprise, I'd say the inflationary environment just continues to ripple through bigger than we were expecting, whether, again, it's property and casualty insurance renewals. Our health insurance continues to run hot. Other elements -- I hate to even mention something as small -- or like audit fees. I mean everything out there is -- everybody is feeling increased inflation still even at the service -- well, all those I just mentioned at the services level. And then I -- and your second point, Joe, was more on what we're doing in the future. Is that right?

Yes. The biggest opportunities, kind of high level.

You know what? I think we're going to be looking at, as I mentioned, payroll and payroll-related items, marketing spend and efficiency there, for sure location optimization, just all different aspects of the business, much broader than we had originally started looking at. Just -- and part of that is just the reality of where the industry is today. The industry softness is greater than we anticipated when we started this fiscal year.

Our next question is from the line of Fred Whiteman with Wolfe Research.

Just a follow-up on that last question. I mean, you've had to cut the outlook a few different times from a top line and an earnings perspective. When you look at sort of the retail environment coming in softer than expected, you've talked a few times about the margin pressure that you're seeing and expecting to continue. Like what gives you confidence at this point in the selling season that you've been conservative enough with the forward outlook of the forward assumptions?

I'll tell you, and number one, we don't like cutting guidance twice. Let's go on record to say that. I will reiterate again that the outlook that we had for the industry was much different than how the industry is trending. We expected a flat to up slightly unit industry through the first 6 months. We saw what happened in December in the December quarter, where it was down worse than we expected. We didn't think it would happen again in the March quarter. So you know what, Fred, you put in your best outlook, you put in your best assumptions, which I think we're doing that here again, you lower your numbers to where you think they're going to be achievable. Every company wants to have upside in the numbers. So you always strive to do that. The issue is ultimately in the industry you're playing in, where does it settle? And are we finding the right place for it to sell.

And Fred, I'll add that we have data that Mike alluded to or said it in his comments about the return to seasonality. It just kind of is taken -- I think that last year, we said there's a return to seasonality, but it's still continuing to shift that way, where the bulk of your business really starts hitting in that selling season. And that -- those data points help guide us for the next 2 quarters also.

That's fair. And there was a comment that things had picked up in April. I wasn't sure if that was a sequential comment to maybe reflecting more of that normal seasonality? Or is that a year-over-year comment? What exactly do you guys mean there?

Yes. I can comment on that. So if you go way back to last year, we did say that April was a little softer during the month of April and it was following the banking crisis. So we're up against a pretty easy comparison in April. And April data, it does -- as I mentioned, it doesn't like seasonality could be playing a bigger role with just the mix of business between Florida and non-Florida in the March quarter. And then looking at what's kind of getting active in April, it's obviously -- Florida is always pretty good for us, but the northern markets really seem to be coming alive. So April does seem poised to be a solid month for us. Obviously, we've got to get everything closed and drag it across the finish line next week. But -- and so that was a seasonal comment as much as anything, Fred.

Okay. And then just lastly, is there -- is the Williams' acquisition, is that -- I assume it's reflected in the new EPS guidance so I don't think it was last quarter. Is there a specific call out from an EPS perspective for that.

So thanks for bringing it up. It is in our guidance, and it is a fantastic company to merge. We're happy to get them on the team. In the size and scope of MarineMax anymore, there's not a lot of acquisitions that really just move the needle when it comes to revenue and EPS in a meaningful way to really call it out. It is accretive. It is a high-margin business. It's got a fantastic management team with a great product. So we're really happy to bring on board.

Okay. But specifically not enough to move the needle in.

It's adding to it. So the guidance reflects some contribution from them. It's just not a real big dollar amount from them.

Our next question is from the line of Mike Swartz with Truist Securities.

Maybe just a little color on inventory. And I think, Mike or Brett, you had mentioned that inventories may be a little more dependent on brand or category, but maybe at a high level, just give us a sense of where are your turns today? And maybe where do they need to be over the next 3 or 6 months before you feel a little more comfortable?

Yes. I actually don't have that data handy, but I'm fairly certain if you do the turns on our growing 12%, we're in the 2.4 to 2.5 range, something like that, where I think the industry historically would be about 1.8x. We were usually better than that. Our inventory itself is not in what I'd call bad shape at all. I mean we have some pockets of opportunities like probably most people do, but I think we've been more proactive at moving product. Our noncurrent percentages and all that are better than other dealers out there by a long shot that we've seen. And for us, we would love to see inventory -- we'd like to see our turns north of 3x. It's going to take a lot of work to get there over time. Before COVID, we would be 2.5%, sometimes a little bit higher than that. I don't know if that's answered your question, Mike, but it's --

We have some opportunities for share in inventory, but we've been also aggressive moving like we were in the March quarter too.

That's helpful. I appreciate that. And maybe there's been a lot of talk about the NOAA regulations on offshore speed. And maybe just if you want to go on record and give us maybe your quick thoughts about those regulations that proposed and any impact that might have on your business?

We haven't studied the direct impact on our exact stores and locations. Yet we're still trying to learn more about what it means and kind of relying on some industry information there. So we haven't studied it exactly for our stores and business. It potentially in some locations, it could be not very impactful at all because of the seasonality of where those restrictions are in those stores kind of the seasonality is okay. But it will have an impact on. I think when you're reading, there's a lot of commercial industry impact that's getting most of the media. I'm not at all trying to underestimate that it couldn't have a recreational impact, but for sure, on the commercial.

And the final rules are not out yet, Mike. I think you know that. But -- so we're -- I think the industry is waiting to see the final rules to really understand what the impact is. So it's something that we're all watching.

Our next question is from the line of Eric Wold with B. Riley Securities.

I guess I want to go back to kind of the guidance change. And I know, obviously, you don't like to change guidance. There's a lot of moving parts in there. But I just want to get a better sense of the key drivers. I know that, if I recall correctly, you were not assuming any rate cuts in the previous guidance in terms of drivers of demand and whatnot. So obviously, that hasn't changed. And if Q2 is -- the miss versus your expectations is more a reflection of increased seasonality or seasonality coming back into the market. You're seeing -- possibly aiming to that kind of on the reverse side in April. How much of the remaining cuts of the year -- I know it's probably all of these things. But can you kind of rank, is it increased concern kind of underlying kind of demand pressures in general, even if rates don't change? Is it increased competition from others? The need to drive more promotional activity to get people to cross the line? I'm sure it's all those play into it. But how do you kind of rank those if seasonality was kind of probably the bigger driver to the miss in Q2 versus what you would have thought going into it?

Yes. I would rank them as a tougher industry environment granted where there are signs that maybe seasonality is going to play a role here and help with the summer selling season. But we're assuming that we're going to be in a tougher retail environment, and we're going to keep kind of both feet on the gas pedal, including being more aggressive on margins. So number one, it's going to be the tougher environment combined with margins, is probably the biggest driver of the change in the back half, combined with -- we're -- we commented a couple of times we did expect additional revenue in the March quarter. The March quarter, we were up against a negative 13% comp. So we expected higher than 2% same-store sales growth. And so we had some revenue that didn't close, without getting into all the specifics of that. We -- our inventory is elevated a little bit, which means our interest expense is going to be a little elevated in the June quarter. Although it will start coming down as we get close to the end of the June quarter. And then a little bit higher interest also in the September quarter, as we said on the call. So it's really margin, a tougher environment and then interest, Eric, if that answers your question.

It does. And just a follow-up on inventories, obviously, ending the quarter higher because they just came in below. And you said that you're kind of -- the OEMs are being a little more accommodating, kind of adjusting production. Where do you -- if you ended September of last year $813 million of inventories, where do you expect inventories to end this September? Would you expect them to be higher than last fiscal year-end, lower, in line? And then kind of assuming we get into a better environment in fiscal '25 and demand improves, is this a good inventory level for a -- I'm talking about the inventory at the end of this current quarter, the kind of 800 and change at the end of the fiscal year. Is that a good inventory level for a low single-digit retail increase environment? Or would you need to move higher than that?

Inventories will move higher in dollars than they ended last summer. Last summer, inventories were building, but there were still some brands that had not gotten product out to a reasonable level compared to prior times because of supply chain issues or manufacturing issues or whatever it may be. So I would expect inventory levels to be higher. I don't recall our exact estimate of where it's going to be, but it's going to be higher. And then within that, the devil is always in the detail by brand and by segment and how do we work with the manufacturers on -- what do we think about 2025 and production and incentives. I think most people in the industry -- I know Brunswick has got a couple of slides on this, where they're looking at 2024 kind of being a low point. And then model year 2025, the industry begins to pick up from there, which makes a lot of sense. We just -- we got to get to that point to see that that's actually playing out that way.

Our next question is from the line of David MacGregor with Longbow Research.

This is Joe Nolan on for David. Most of my questions have been answered at this point, but I just wanted to ask whether, obviously, first quarter always has some sort of weather impact, but it seems maybe a little bit worse than a typical first quarter. So I was just wondering if you could talk a little bit about the cadence of sales through the quarter as we saw weather improve a bit.

Yes. I'd say weather did probably play a little bit of a role, believe it or not. I mean, we live here in Florida and Florida had a wet windy cold March quarter, a lot of folks up North don't feel sorry for us, but I usually bode a fair amount in the March quarter, and I was not out much at all. So and April weather is pretty -- shaping up pretty nicely here, which you can kind of see that in our comments about April being strong. Yes. So there probably is some play on weather that we're probably experiencing now, including here in the northern markets, too.

And then obviously, we're seeing the step-up in promotion. Can you just talk about the success level that you've seen with the promotions and driving retail activity, whether that's been maybe better or worse than you originally would have expected?

Yes. It's -- when we partner with a manufacturer, we put a full program together that's consumer facing and offers them more and creates urgency, we can help create more urgency. It's absolutely working. That's the key.

Ladies and gentlemen, I now hand the conference over to Mr. McGill for his closing comments. Please go ahead.

Well, we appreciate everybody joining the call this morning, and we look forward to updating you on our progress in the next quarterly call. Have a great day.

Thank you. The conference of MarineMax has now concluded. Thank you for your participation. You may now disconnect your lines.