Delaware | 58-2572419 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
Part I. Financial Information
|
Page
No. |
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Item 1.
|
Financial Statements (Unaudited)
|
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Consolidated Balance Sheets – As of September 30, 2014 and December 31, 2013
|
3
|
||
Consolidated Statements of Operations – for the three months and nine months ended September 30, 2014 and 2013
|
4
|
||
Consolidated Statements of Comprehensive Income – for the three months and nine months ended September 30, 2014 and 2013
|
5
|
||
Consolidated Statement of Stockholders’ Equity – for the nine months ended September 30, 2014
|
6
|
||
Consolidated Statements of Cash Flows – for the nine months ended September 30, 2014 and 2013
|
7
|
||
Notes to Consolidated Financial Statements
|
8-20
|
||
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
21-30
|
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
31
|
|
Item 4.
|
Controls and Procedures
|
31
|
|
Part II. Other Information
|
|||
Item 1.
|
Legal Proceedings
|
32
|
|
Item 1A.
|
Risk Factors
|
32
|
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
32
|
|
Item 3.
|
Defaults upon Senior Securities
|
32
|
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Item 4.
|
Mine Safety Disclosures
|
32
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|
Item 5.
|
Other Information
|
32
|
|
Item 6.
|
Exhibits
|
33
|
|
Signatures
|
34
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2 |
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
|
PART I. FINANCIAL INFORMATION
|
ITEM 1. FINANCIAL STATEMENTS
|
September 30,
|
December 31,
|
|||||||
2014
|
2013
|
|||||||
ASSETS
|
||||||||
Cash and cash equivalents
|
$ | 5,296 | $ | 5,114 | ||||
Marketable securities
|
12,024 | 5,639 | ||||||
Accounts receivable, net
|
3,515 | 2,021 | ||||||
Inventories
|
24,573 | 28,859 | ||||||
Income taxes receivable
|
332 | 692 | ||||||
Deferred income taxes
|
1,374 | 1,096 | ||||||
Prepaid expenses and other current assets
|
1,644 | 1,839 | ||||||
Total current assets
|
48,758 | 45,260 | ||||||
Property, plant and equipment, less accumulated
depreciation of $25,067 in 2014 and $24,567 in 2013
|
11,052 | 11,265 | ||||||
Goodwill
|
3,308 | 3,308 | ||||||
Other intangibles, net
|
465 | 465 | ||||||
Marketable securities
|
32,492 | 30,949 | ||||||
Deferred income taxes
|
3,347 | 3,177 | ||||||
Other assets
|
8,495 | 8,129 | ||||||
Total assets
|
$ | 107,917 | $ | 102,553 | ||||
LIABILITIES AND STOCKHOLDERS
’
EQUITY
|
||||||||
Accounts payable
|
$ | 5,939 | $ | 5,569 | ||||
Accrued expenses and other liabilities
|
10,369 | 8,993 | ||||||
Total current liabilities
|
16,308 | 14,562 | ||||||
Pension liabilities
|
6,518 | 6,420 | ||||||
Other long-term liabilities
|
83 | 88 | ||||||
Total liabilities
|
22,909 | 21,070 | ||||||
Common stock
|
3,817 | 3,810 | ||||||
Capital in excess of par value
|
3,638 | 3,583 | ||||||
Retained earnings
|
78,381 | 74,943 | ||||||
Accumulated other comprehensive loss
|
(828 | ) | (853 | ) | ||||
Total stockholders
’
equity
|
85,008 | 81,483 | ||||||
Total liabilities and stockholders
’
equity
|
$ | 107,917 | $ | 102,553 |
3 |
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
|
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Net sales
|
$ | 37,932 | $ | 41,989 | $ | 133,609 | $ | 128,507 | ||||||||
Cost of goods sold
|
30,965 | 34,258 | 108,372 | 106,349 | ||||||||||||
Gross profit
|
6,967 | 7,731 | 25,237 | 22,158 | ||||||||||||
Selling, general and administrative expenses
|
4,391 | 4,935 | 15,768 | 15,408 | ||||||||||||
Operating income
|
2,576 | 2,796 | 9,469 | 6,750 | ||||||||||||
Interest income
|
116 | 83 | 359 | 410 | ||||||||||||
Income before income taxes
|
2,692 | 2,879 | 9,828 | 7,160 | ||||||||||||
Income tax provision
|
810 | 877 | 2,955 | 1,774 | ||||||||||||
Net income
|
$ | 1,882 | $ | 2,002 | $ | 6,873 | $ | 5,386 | ||||||||
Earnings per share
|
||||||||||||||||
Basic
|
$ | 0.05 | $ | 0.05 | $ | 0.19 | $ | 0.15 | ||||||||
Diluted
|
$ | 0.05 | $ | 0.05 | $ | 0.18 | $ | 0.15 | ||||||||
Dividends paid per share
|
$ | 0.03 | $ | 0.03 | $ | 0.09 | $ | 0.09 | ||||||||
Weighted average shares outstanding
|
||||||||||||||||
Basic
|
36,904 | 36,827 | 36,950 | 36,779 | ||||||||||||
Diluted
|
37,190 | 37,180 | 37,236 | 37,058 |
4 |
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
|
|||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Net income
|
$ | 1,882 | $ | 2,002 | $ | 6,873 | $ | 5,386 | ||||||||
Other comprehensive income (loss), net of taxes:
|
||||||||||||||||
Pension adjustment
|
5 | 12 | 17 | 33 | ||||||||||||
Unrealized (loss) gain on securities,
|
||||||||||||||||
net of reclassification adjustments
|
(32 | ) | 77 | 8 | (103 | ) | ||||||||||
Comprehensive income
|
$ | 1,855 | $ | 2,091 | $ | 6,898 | $ | 5,316 |
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
|
Accumulated | ||||||||||||||||||||||||
Capital in | Other | |||||||||||||||||||||||
Common Stock
|
Excess of
|
Retained | Comprehensive | |||||||||||||||||||||
Shares
|
Amount
|
Par Value |
Earnings
|
Income (Loss)
|
Total
|
|||||||||||||||||||
Balance, December 31, 2013
|
38,095 | $ | 3,810 | $ | 3,583 | $ | 74,943 | $ | (853 | ) | $ | 81,483 | ||||||||||||
Stock issued for stock incentive
plans, net
|
273 | 27 | 1,345 | — | — | 1,372 | ||||||||||||||||||
Stock purchased and retired
|
(202 | ) | (20 | ) | (1,601 | ) | — | — | (1,621 | ) | ||||||||||||||
Net income
|
— | — | — | 6,873 | — | 6,873 | ||||||||||||||||||
Pension adjustment, net of taxes
|
— | — | — | — | 17 | 17 | ||||||||||||||||||
Unrealized gain on securities, net of taxes
and reclassification adjustments
|
— | — | — | — | 8 | 8 | ||||||||||||||||||
Dividends declared
|
— | — | — | (3,435 | ) | — | (3,435 | ) | ||||||||||||||||
Excess tax benefits for share-based
payments
|
— | — | 311 | — | — | 311 | ||||||||||||||||||
Balance, September 30, 2014
|
38,166 | $ | 3,817 | $ | 3,638 | $ | 78,381 | $ | (828 | ) | $ | 85,008 |
MARINE PRODUCTS CORPORATION AND SUBSIDIARIES
|
||||||
Nine months ended September 30,
|
||||||||
2014
|
2013
|
|||||||
OPERATING ACTIVITIES
|
||||||||
Net income
|
$ | 6,873 | $ | 5,386 | ||||
Adjustments to reconcile net income to net cash provided by
operating activities:
|
||||||||
Depreciation and amortization
|
536 | 545 | ||||||
Gain on sale of equipment and property
|
(17 | ) | (12 | ) | ||||
Stock-based compensation expense
|
1,372 | 1,273 | ||||||
Excess tax benefits for share-based payments
|
(311 | ) | (108 | ) | ||||
Deferred income tax benefit
|
(462 | ) | (271 | ) | ||||
(Increase) decrease in assets:
|
||||||||
Accounts receivable
|
(1,494 | ) | (2,178 | ) | ||||
Inventories
|
4,286 | 572 | ||||||
Prepaid expenses and other current assets
|
195 | 40 | ||||||
Income taxes receivable
|
360 | 394 | ||||||
Other non-current assets
|
(339 | ) | (271 | ) | ||||
Increase (decrease) in liabilities:
|
||||||||
Accounts payable
|
369 | 3,040 | ||||||
Income taxes payable
|
426 | 489 | ||||||
Accrued expenses and other liabilities
|
1,261 | 437 | ||||||
Other long-term liabilities
|
93 | 237 | ||||||
Net cash provided by operating activities
|
13,148 | 9,573 | ||||||
INVESTING ACTIVITIES
|
||||||||
Capital expenditures
|
(345 | ) | (244 | ) | ||||
Proceeds from sale of assets
|
39 | 12 | ||||||
Purchases of marketable securities
|
(15,324 | ) | (12,355 | ) | ||||
Sales of marketable securities
|
4,719 | 11,111 | ||||||
Maturities of marketable securities
|
2,690 | - | ||||||
Net cash used for investing activities
|
(8,221 | ) | (1,476 | ) | ||||
FINANCING ACTIVITIES
|
||||||||
Payment of dividends
|
(3,435 | ) | (3,423 | ) | ||||
Excess tax benefits for share-based payments
|
311 | 108 | ||||||
Cash paid for common stock purchased and retired
|
(1,621 | ) | (576 | ) | ||||
Net cash used for financing activities
|
(4,745 | ) | (3,891 | ) | ||||
Net increase in cash and cash equivalents
|
182 | 4,206 | ||||||
Cash and cash equivalents at beginning of period
|
5,114 | 1,648 | ||||||
Cash and cash equivalents at end of period
|
$ | 5,296 | $ | 5,854 | ||||
Supplemental information:
|
||||||||
Income tax payments, net
|
$ | 2,632 | $ | 1,165 |
7 |
1.
|
GENERAL
|
2.
|
RECENT ACCOUNTING PRONOUNCEMENTS
|
|
Recently Adopted Accounting Pronouncements:
|
●
|
Accounting Standards Update (ASU) 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists.
The amendments in this ASU requires an unrecognized tax benefit, or a portion of thereof, to be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carry-forward, a similar tax loss, or a tax credit carry-forward. The only exception would be if the deferred taxes related to these items are not available to settle any additional income taxes that would result from the disallowance of a tax position either by statute or at the entity’s choosing. In such cases, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The Company adopted these provisions in the first quarter of 2014 and adoption did not have a material impact on the Company’s consolidated financial statements.
|
8 |
Recently
Issued
Accounting Pronouncements Not Yet Adopted:
|
●
|
Accounting Standards Update No. 2014-15, Presentation of Financial Statements —Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.
The provisions in this ASU are intended to define management’s responsibility to evaluate whether there is substantial doubt about an organization’s ability to continue as a going concern and to provide related footnote disclosures. Currently, financial statements are prepared under the presumption that the reporting organization will continue to operate as a going concern, except in limited circumstances. This going concern basis of accounting is critical to financial reporting because it establishes the fundamental basis for measuring and classifying assets and liabilities. This ASU provides guidance regarding management’
s
responsibility to evaluate whether there is substantial doubt about the organization’s ability to continue as a going concern and the related footnote disclosures. The amendments are effective for the year ending December 31, 2016, and for interim periods beginning the first quarter of 2017, with early application permitted. The Company plans to adopt the provisions for the year ending December 31, 2016 and will provide such disclosures as required if there are conditions and events that raise substantial doubt about its ability to continue as a going concern. The Company currently does not expect the adoption to have a material impact on its consolidated financial statements.
|
●
|
Accounting Standards Update 2014-09, Revenue from Contracts with Customers (Topic 606).
This ASU affects any entity using U.S. GAAP that either enters into contracts with customers to transfer goods or services or enters into contracts for the transfer of nonfinancial assets unless those contracts are within the scope of other standards (e.g., insurance contracts or lease contracts). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply a five step process – (i) identifying the contract(s) with a customer, (ii) identifying the performance obligations in the contract, (iii) determining the transaction price, (iv) allocating the transaction price to the performance obligations in the contract and (v) recognizing revenue when (or as) the entity satisfies a performance obligation. The Company plans to adopt these provisions in the first quarter of 2017 and is currently evaluating the impact of these provisions on its financial statements. Early adoption is not permitted.
|
●
|
Accounting Standards Update 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity.
The amendments in the ASU require that only disposals representing a strategic shift in operations should be presented as discontinued operations. Those strategic shifts should have a major effect on the organization’s operations and financial results. Examples include a disposal of a major geographic area, a major line of business, or a major equity method investment. In addition, the new guidance requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The new guidance also requires disclosure of the pre-tax income attributable to a disposal of a significant part of an organization that does not qualify for discontinued operations reporting. The amendments in the ASU are effective in the first quarter of 2015 with early adoption permitted. The Company plans to adopt these provisions in the first quarter of 2015 and does not expect the adoption to have a material impact on the Company’s consolidated financial statements.
|
9 |
3.
|
EARNINGS PER SHARE
|
Three months ended
September 30
,
|
Nine months ended
September 30,
|
|||||||||||||||
(In thousands except per share data )
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Net income available for stockholders
|
$ | 1,882 | $ | 2,002 | $ | 6,873 | $ | 5,386 | ||||||||
Less: Dividends paid
|
(1,144 | ) | (1,140 | ) | (3,435 | ) | (3,423 | ) | ||||||||
Undistributed earnings
|
$ | 738 | $ | 862 | $ | 3,438 | $ | 1,963 | ||||||||
Basic shares outstanding:
|
||||||||||||||||
Common stock
|
35,642 | 35,556 | 35,710 | 35,516 | ||||||||||||
Restricted shares of common stock
|
1,262 | 1,271 | 1,240 | 1,263 | ||||||||||||
36,904 | 36,827 | 36,950 | 36,779 | |||||||||||||
Diluted shares outstanding:
|
||||||||||||||||
Common stock
|
35,642 | 35,556 | 35,710 | 35,516 | ||||||||||||
Dilutive effect of stock based awards
|
286 | 353 | 286 | 279 | ||||||||||||
35,928 | 35,909 | 35,996 | 35,795 | |||||||||||||
Restricted shares of common stock
|
1,262 | 1,271 | 1,240 | 1,263 | ||||||||||||
37,190 | 37,180 | 37,236 | 37,058 |
Three months ended September 30,
|
Nine months ended September 30,
|
||||
(in thousands)
|
2014
|
2013
|
2014
|
2013
|
|
Stock options
|
-
|
42
|
-
|
42
|
10 |
4.
|
STOCK-BASED COMPENSATION
|
(in thousands)
|
Three months ended
September 30,
|
Nine months ended
September 30,
|
||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Pre – tax cost
|
$ | 468 | $ | 429 | $ | 1,372 | $ | 1,273 | ||||||||
After tax cost
|
$ | 303 | $ | 276 | $ | 885 | $ | 821 |
Shares
|
Weighted Average
Exercise
Price
|
Weighted Average Remaining Contractual
Life in years
|
Aggregate
Intrinsic
Value
|
||||||||||
Outstanding at December 31, 2013
|
41,600 | $ | 12.47 | 0.33 | |||||||||
Granted
|
- | - | N/A | ||||||||||
Exercised
|
- | - | N/A | ||||||||||
Forfeited
|
- | - | N/A | ||||||||||
Expired
|
(41,600 | ) | 12.47 | N/A | |||||||||
Outstanding at September 30, 2014
|
0 | N/A | N/A |
N/A
|
11 |
Shares
|
Weighted Average
Grant-Date
Fair Value
|
|||||||
Non-vested shares at December 31, 2013
|
1,268,200 | $ | 6.01 | |||||
Granted
|
273,000 | $ | 7.90 | |||||
Vested
|
(276,100 | ) | $ | 5.76 | ||||
Forfeited
|
(3,550 | ) | $ | 6.09 | ||||
Non-vested shares at September 30, 2014
|
1,261,550 | $ | 6.47 |
5.
|
MARKETABLE SECURITIES
|
12 |
Three months ended
|
Nine months ended
|
|||||||||||||||
September 30,
|
September 30,
|
|||||||||||||||
(in thousands)
|
2014
|
2013
|
2014
|
2013
|
||||||||||||
Net realized gain (loss)
|
$ | 3 | $ | (24 | ) | $ | 5 | $ | 56 | |||||||
Reclassification of net realized gains from other comprehensive income
|
$ | 3 | $ | (24 | ) | $ | 5 | $ | 56 |
September 30, 2014
|
December 31, 2013
|
|||||||||||||||
Gross unrealized
|
Gross unrealized
|
|||||||||||||||
(in thousands)
|
Gains
|
(Losses)
|
Gains
|
(Losses)
|
||||||||||||
Municipal Obligations
|
$ | 235 | $ | (3 | ) | $ | 223 | $ | (16 | ) | ||||||
Corporate Obligations
|
6 | (12 | ) | 6 | - | |||||||||||
$ | 241 | $ | (15 | ) | $ | 229 | $ | (16 | ) |
September 30, 2014
|
December 31, 2013
|
|||||||||||||||||||||||
Type of Securities
|
Amortized
Cost Basis
|
Fair
Value
|
Net
Unrealized
Gains
(Losses)
|
Amortized
Cost Basis
|
Fair
Value
|
Net
Unrealized
Gains
|
||||||||||||||||||
(in thousands)
|
||||||||||||||||||||||||
Municipal Obligations
|
$ | 39,312 | $ | 39,544 | $ | 232 | $ | 35,925 | $ | 36,132 | $ | 207 | ||||||||||||
Corporate Obligations
|
4,978 | 4,972 | (6 | ) | 450 | 456 | 6 | |||||||||||||||||
Total
|
$ | 44,290 | $ | 44,516 | $ | 226 | $ | 36,375 | $ | 36,588 | $ | 213 |
13 |
6.
|
WARRANTY COSTS AND OTHER CONTINGENCIES
|
(in thousands)
|
2014
|
2013
|
||||||
Balance at beginning of period
|
$ | 3,410 | $ | 2,522 | ||||
Less: Payments made during the period
|
(1,039 | ) | (1,232 | ) | ||||
Add: Warranty provision for the period
|
1,918 | 1,903 | ||||||
Changes to warranty provision for prior periods
|
(66 | ) | 222 | |||||
Balance at September 30
|
$ | 4,223 | $ | 3,415 |
14 |
7. |
BUSINESS SEGMENT INFORMATION
|
|
The Company has only one reportable segment, its powerboat manufacturing business; therefore, the majority of segment-related disclosures are not relevant to the Company. In addition, the Company’s results of operations and its financial condition are not significantly reliant upon any single customer or product model.
|
8. |
INVENTORIES
|
(in thousands)
|
September 30,
2014
|
December 31,
2013
|
||||||
Raw materials and supplies
|
$ | 15,479 | $ | 15,901 | ||||
Work in process
|
5,638 | 7,435 | ||||||
Finished goods
|
3,456 | 5,523 | ||||||
Total inventories
|
$ | 24,573 | $ | 28,859 |
9. |
INCOME TAXES
|
15 |
10. |
EMPLOYEE BENEFIT PLANS
|
(in thousands)
|
Three months ended
September 30,
|
Nine months ended
September 30,
|
||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Interest cost
|
$ | 65 | $ | 59 | $ | 195 | $ | 176 | ||||||||
Expected return on plan assets
|
(103 | ) | (93 | ) | (307 | ) | (277 | ) | ||||||||
Amortization of net losses
|
9 | 17 | 27 | 51 | ||||||||||||
Net periodic benefit
|
$ | (29 | ) | $ | (17 | ) | $ | (85 | ) | $ | (50 | ) |
16 |
11. |
FAIR VALUE MEASUREMENTS
|
Fair Value Measurements at September 30, 2014 with:
|
||||||||||||
(in thousands
)
|
Quoted prices
in active markets for
identical
assets |
Significant
other observable inputs |
Significant unobservable inputs
|
|||||||||
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||
Assets:
|
||||||||||||
Trading securities
|
$ | - | $ | 6,486 | $ | - | ||||||
Available-for-sale securities:
|
||||||||||||
Municipal obligations
|
$ | - | $ | 39,544 | $ | - | ||||||
Corporate obligations
|
- | 4,972 | - | |||||||||
$ | - | $ | 44,516 | $ | - |
17 |
Fair Value Measurements at December 31, 2013 with:
|
||||||||||||
(in thousands
)
|
Quoted
prices in
active
markets for
identical
assets |
Significant
other
observable
inputs
|
Significant unobservable inputs
|
|||||||||
(Level 1)
|
(Level 2)
|
(Level 3)
|
||||||||||
Assets:
|
||||||||||||
Trading securities
|
$ | - | $ | 6,388 | $ | - | ||||||
Available-for-sale securities:
|
||||||||||||
Municipal obligations
|
$ | - | $ | 36,132 | $ | - | ||||||
Corporate obligations
|
- | 456 | - | |||||||||
$ | - | $ | 36,588 | $ | - |
18 |
12. |
ACCUMULATED OTHER COMPREHENSIVE LOSS
|
(in thousands)
|
Pension
Adjustment
|
Unrealized
Gain On
Securities
|
Total
|
|||||||||
Balance at December 31, 2013
|
$ | (990 | ) | $ | 137 | $ | (853 | ) | ||||
Change during the period ended September 30, 2014:
|
||||||||||||
Before-tax amount
|
_
|
5 | 5 | |||||||||
Tax provision
|
_
|
(2 | ) | (2 | ) | |||||||
Reclassification adjustment, net of taxes
|
||||||||||||
Amortization of net loss
(1)
|
17 | - | 18 | |||||||||
Net realized gain
(2)
|
- | 5 | 5 | |||||||||
Total activity for the period
|
17 | 8 | 25 | |||||||||
Balance at September 30, 2014
|
$ | (973 | ) | $ | 145 | $ | (828 | ) |
(1)
|
Reported as part of selling, general and administrative expenses.
|
(2)
|
Reported as part of interest income.
|
(in thousands)
|
Pension
Adjustment
|
Unrealized
Gain On
Securities
|
Total
|
|||||||||
Balance at December 31, 2012
|
$ | (1,771 | ) | $ | 199 | $ | (1,572 | ) | ||||
Change during the period
ended September 30, 2013:
|
||||||||||||
Before-tax amount
|
_
|
(216 | ) | (216 | ) | |||||||
Tax benefit
|
_
|
77 | 77 | |||||||||
Reclassification adjustment, net of taxes
|
||||||||||||
Amortization of net loss
(1)
|
33 | - | 33 | |||||||||
Net realized gain
(2)
|
- | 36 | 36 | |||||||||
Total activity for the period
|
33 | (103 | ) | (70 | ) | |||||||
Balance at September 30, 2013
|
$ | (1,738 | ) | $ | 96 | $ | (1,642 | ) |
(1)
|
Reported as part of selling, general and administrative expenses.
|
(2)
|
Reported as part of interest income.
|
19 |
13. |
SUBSEQUENT EVENT
|
On October 29, 2014, the Company announced that the Board of Directors declared a regular quarterly cash dividend on its common stock of $0.03 per share in addition to a special dividend of $0.04 per share both payable December 10, 2014 to stockholders of record at the close of business November 10, 2014.
|
20 |
21 |
22 |
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||||||||||
2014
|
2013
|
2014
|
2013
|
|||||||||||||
Total number of boats sold
|
801 | 879 | 2,703 | 2,730 | ||||||||||||
Average gross selling price per boat
(in thousands)
|
$ | 43.2 | $ | 44.6 | $ | 45.3 | $ | 43.7 | ||||||||
Net sales
(in thousands)
|
$ | 37,932 | $ | 41,989 | $ | 133,609 | $ | 128,507 | ||||||||
Percentage of cost of goods sold to net sales
|
81.6 | % | 81.6 | % | 81.1 | % | 82.8 | % | ||||||||
Gross profit margin percent
|
18.4 | % | 18.4 | % | 18.9 | % | 17.2 | % | ||||||||
Percentage of selling, general and administrative expenses to net sales
|
11.6 | % | 11.8 | % | 11.8 | % | 12.0 | % | ||||||||
Operating income
(in thousands)
|
$ | 2,576 | $ | 2,796 | $ | 9,469 | $ | 6,750 | ||||||||
Warranty expense
(in thousands)
|
$ | 307 | $ | 687 | $ | 1,852 | $ | 2,125 |
23 |
24 |
25 |
Nine months ended September 30,
|
||||||||
(
in thousands
)
|
2014
|
2013
|
||||||
Net cash provided by operating activities
|
$ | 13,148 | $ | 9,573 | ||||
Net cash used for investing activities
|
(8,221 | ) | (1,476 | ) | ||||
Net cash used for financing activities
|
$ | (4,745 | ) | $ | (3,891 | ) |
26 |
On October 29, 2014, the Board of Directors approved a $0.03 per share cash dividend in addition to a special dividend of $0.04 per common share, both payable December 10, 2014 to stockholders of record at the close of business November 10, 2014. The Company expects to continue to pay cash dividends to common stockholders, subject to the earnings and financial condition of the Company and other relevant factors.
27 |
28 |
29 |
30 |
31 |
32 |
ITEM 6.
|
Exhibits | |||
Exhibit Number | Description | |||
3.1(a)
|
Marine Products Corporation Articles of Incorporation (incorporated herein by reference to Exhibit 3.1 to the Registrant’s Registration Statement on Form 10 filed on February 13, 2001).
|
|||
3.1(b)
|
Certificate of Amendment of Certificate of Incorporation of Marine Products Corporation executed on September 8, 2005 (incorporated herein by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed September 9, 2005).
|
|||
3.2
|
Amended and Restated By-laws of Marine Products Corporation.
|
|||
4
|
Restated Form of Stock Certificate (incorporated herein by reference to Exhibit 4.1 to the Registrant’s Registration Statement on Form 10 filed on February 13, 2001).
|
|||
31.1 |
Section 302 certification for Chief Executive Officer
|
|||
31.2
|
Section 302 certification for Chief Financial Officer
|
|||
32.1
|
Section 906 certifications for Chief Executive Officer and Chief Financial Officer
|
|||
101.INS
|
XBRL Instance Document
|
|||
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
|||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|||
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
|||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
33 |
MARINE PRODUCTS CORPORATION
|
|||
/s/ Richard A. Hubbell | |||
Date: November 3, 2014
|
Richard A. Hubbell | ||
President and Chief Executive Officer | |||
(Principal Executive Officer) |
/s/ Ben M. Palmer | |||
Date: November 3, 2014
|
Ben M. Palmer | ||
Vice President, Chief Financial Officer and Treasurer | |||
(Principal Financial and Accounting Officer) |
34 |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
9 |
10 |
11 |
12 |
13 |
14 |
15 |
16 |
17 |
18 |
19 |
20 |
1.
|
I have reviewed this quarterly report on Form 10-Q of Marine Products Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Richard A. Hubbell
|
||
Date: November 3, 2014
|
Richard A. Hubbell
|
|
President and Chief Executive Officer
|
||
(Principal Executive Officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Marine Products Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Ben M. Palmer
|
||
Date: November 3, 2014
|
Ben M. Palmer
Vice President, Chief Financial Officer, and Treasurer
(Principal Financial and Accounting Officer)
|
Date: November 3, 2014
|
/s/ Richard A. Hubbell
|
|
Richard A. Hubbell
President and Chief Executive Officer
(Principal Executive Officer)
|
Date: November 3, 2014
|
/s/ Ben M. Palmer
|
|
Ben M. Palmer
Vice President, Chief Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
|