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What changed in BRUNSWICK CORP's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of BRUNSWICK CORP's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+223 added−286 removedSource: 10-K (2025-02-14) vs 10-K (2024-02-16)

Top changes in BRUNSWICK CORP's 2024 10-K

223 paragraphs added · 286 removed · 182 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

42 edited+20 added−32 removed27 unchanged
Biggest changeImplementing processes and systems that meet SMS criteria is designed to result in less frequent and less severe work-related incidents and injuries. 9 Tab l e of Content s The Company's recordable and lost-time incident rates from 2021 to 2023, recorded as of December 31, are as follows: Our global recordable incident rate is considerably lower than the benchmarks of the U.S.
Biggest changeImplementing processes and systems that meet our SMS criteria is designed to result in less frequent and less severe work-related incidents and injuries, while meeting or exceeding applicable regulatory requirements. 8 Table of Contents The Company's recordable and lost-time incident rates* from 2022 to 2024, recorded as of December 31, are as follows: *Recordable Rate is the rate of injuries involving treatment beyond first aid per 100 employees; Lost Time Incident Rate is the rate of injuries per 100 employees in which an employee was not able to work at least one day.
We are dedicated to industry leadership, to being the best and most trusted partner to our many customers, and to building synergies and ecosystems that enable us to challenge convention and define the future. Incorporated in Delaware on December 31, 1907, Brunswick has traded on the New York Stock Exchange for nearly 100 years.
We are dedicated to industry leadership, to being the best and most trusted partner to our many customers, and to building synergies and ecosystems that enable us to challenge convention and define the future. Incorporated in Delaware on December 31, 1907, Brunswick has traded on the New York Stock Exchange for 100 years.
Business Acceleration also operates a variety of other businesses including dealer and retailer financing; retail extended warranty and insurance businesses; Boateka, a certified pre-owned boat platform; and other marine services businesses. Financing Services Through our Brunswick Financial Services Corporation subsidiary, we own a 49 percent interest in a joint venture, Brunswick Acceptance Company, LLC (BAC).
Business Acceleration also operates a variety of other businesses including dealer and retail financing; retail extended warranty and insurance businesses; Boateka, a certified pre-owned boat platform; and other marine services businesses. Financing Services Through our Brunswick Financial Services Corporation subsidiary, we own a 49 percent interest in a joint venture, Brunswick Acceptance Company, LLC (BAC).
The Boat segment manages Brunswick's boat brands, evaluates and optimizes the Boat segment's boat portfolio, promotes recreational boating services and activities to enhance the consumer experience and dealer profitability, including through its Business Acceleration initiatives, and speeds the introduction of new technologies into boat manufacturing and design processes.
The Boat segment manages Brunswick's boat brands, evaluates and optimizes the Boat segment's boat portfolio and strategy, promotes recreational boating services and activities to enhance the consumer experience and dealer profitability, including through its Business Acceleration initiatives, and speeds the introduction of new technologies into boat manufacturing and design processes.
Our strategy is focused on: • Understanding and addressing the changing needs and behaviors of global boating participants; • Investing in innovative, global product leadership and leveraging our leading brands to meet consumer needs; • Delivering distinctive, elevated ownership and shared-access experiences that expand boating participation; • Being the partner of choice to our customers by offering integrated technical and business solutions; • Engaging consumers with the richest, most intuitive digital experiences; • Leading the industry in Autonomy, Connectivity, Electrification, and Shared Access (ACES) strategies, with an expanding set of commercially available products in each category; • Unlocking unique and profound enterprise synergies; • Investing in increasing global business resiliency; • Being an acknowledged marine industry leader in sustainability; and • Being an employer of choice through our clear purpose and culture of inclusiveness.
Our strategy is focused on: • Understanding and addressing the changing needs and behaviors of global boating participants; • Investing in innovative, global product leadership and leveraging our leading brands to meet consumer needs; • Providing customers industry leading quality and customer support; • Delivering distinctive, elevated ownership and shared-access experiences that expand boating participation; • Being the partner of choice to our customers by offering integrated technical and business solutions; • Engaging consumers with the richest, most intuitive digital experiences; • Leading the industry in Autonomy, Connectivity, Electrification, and Shared Access (ACES) strategies, with an expanding set of commercially available products in each category; • Unlocking unique and profound enterprise synergies; • Investing in increasing global business resiliency; • Being an acknowledged marine industry leader in sustainability; and • Being an employer of choice through our clear purpose and culture of inclusiveness.
The prices for these raw materials, parts, and components fluctuate depending on market conditions and inflation. In 2023, our operations continued to experience intermittent supply chain uncertainty and disruptions. Our global procurement operations constantly strive to obtain adequate supplies, better leverage purchasing power across our divisions, and improve cost efficiencies.
The prices for these raw materials, parts, and components fluctuate depending on market conditions and inflation. In 2024, our operations continued to experience intermittent supply chain uncertainty and disruptions. Our global procurement operations constantly strive to obtain adequate supplies, better leverage purchasing power across our divisions, and improve cost efficiencies.
In addition, we operate a leading boat dealer in the Southeastern U.S. with four locations selling boats and parts and accessories. Technology and Innovation We believe Brunswick is uniquely positioned to continue defining the future of the global marine industry.
In addition, we operate a leading boat dealer in the Southeastern U.S. with four locations selling boats and parts and accessories. Technology and Innovation We believe Brunswick is uniquely positioned to continue to define the future of the global marine industry.
We also indirectly compete with businesses that offer alternative leisure products or activities. The following summarizes our competitive position in each segment: Propulsion. The marine engine market is highly competitive among several major international companies, such as outboard engine manufacturers based in Japan and several smaller companies.
We also indirectly compete with businesses that offer alternative leisure products or activities. The following summarizes our competitive position in each segment: Propulsion. The marine engine market is highly competitive among several major international companies, including outboard engine manufacturers based in Japan and several smaller companies.
Boat non-U.S. sales comprised approximately 22 percent of our non-U.S. sales in 2023. Raw Materials and Supplies We purchase a wide variety of raw materials from our supplier base, including commodities such as aluminum, copper, resins, oil, and steel, as well as product parts and components, such as boat windshields.
Boat non-U.S. sales comprised approximately 18 percent of our non-U.S. sales in 2024. Raw Materials and Supplies We purchase a wide variety of raw materials from our supplier base, including commodities such as aluminum, copper, resins, oil, and steel, as well as product parts and components, such as boat windshields.
White River Marine Group, LLC, Brunswick's Engine P&A distribution businesses and Brunswick Boat Group are significant customers. Boat Segment The Boat segment consists of the Brunswick Boat Group (Boat Group), which manufactures and distributes recreational boats, and Business Acceleration.
White Riv er Marine Group, LLC, Brunswick's Engine P&A distribution businesses, and Brunswick Boat Group are significant customers. Boat Segment The Boat segment consists of the Brunswick Boat Group (Boat Group), which manufactures and distributes recreational boats, and Business Acceleration.
We mitigate commodity price risk on certain raw material purchases by entering into fixed priced contracts or derivatives to reduce our exposure related to changes in commodity prices. 5 Tab l e of Content s Intellectual Property We own intellectual property, including patents, trademarks, and trade secrets, related to our current and future products and production methods, in the U.S. and certain other countries.
We mitigate commodity price risk on certain raw material purchases by entering into fixed priced contracts or derivatives to reduce our exposure related to changes in commodity prices. 5 Table of Contents Intellectual Property We own intellectual property, including patents, trademarks, and trade secrets, related to our current and future products and production methods, in the U.S. and certain other countries.
Refer to Note 5 – Segment Information in the Notes to Consolidated Financial Statements for additional information regarding our segments. Propulsion Segment The Propulsion segment, which we believe is a world leader in the manufacturing and sale of recreational marine engines and propulsion systems, had net sales of $2,763.8 million in 2023.
Refer to Note 5 – Segment Information in the Notes to Consolidated Financial Statements for additional information regarding our segments. Propulsion Segment The Propulsion segment, which we believe is a world leader in the manufacturing and sale of recreational marine engines and propulsion systems, had net sales of $2,074.2 million in 2024.
Refer to Note 8 – Financing Joint Venture in the Notes to Consolidated Financial Statements for more information about our financial services offered through BAC. 3 Tab l e of Content s Many dealers secure floor plan financing from BAC, and, to a lesser extent, from other third party financing companies, enabling them to stock product in advance of the peak selling season and providing stable channels for our products.
Refer to Note 8 – Financing Joint Venture in the Notes to Consolidated Financial Statements for more information about our financial services offered through BAC. 3 Table of Contents Many dealers secure floor plan financing from BAC, and, to a lesser extent, from other third party financing companies, enabling them to stock product in advance of the peak selling season and providing stable channels for our products.
We maintain five employee resource groups (ERGs): Women on Water, Brunswick Black Professionals Network, Asians and Pacific Islanders in Marine, Organization for Hispanic/Latinos for Leadership and Advancement, and Brunswick Veterans Network. These ERGs are self-organized, Company-supported groups focused on cultivating a sense of belonging and inclusion at Brunswick.
We maintain five employee resource groups (ERGs): Women on Water, Brunswick Black Professionals Network, Asians and Pacific Islanders in Marine, Organization for Hispanic/Latinos for Leadership and Advancement, and Brunswick Veterans Network. These ERGs are self-organized and open to all employees, focused on cultivating a sense of belonging and inclusion at Brunswick.
International Operations Non-U.S. sales are set forth in Note 2 – Revenue Recognition and Note 5 – Segment Information in the Notes to Consolidated Financial Statements and are also included in the table below, which details our non-U.S. sales by region: (in millions) 2023 2022 2021 Europe $ 837.3 $ 904.4 $ 796.2 Canada 373.0 458.2 411.7 Asia-Pacific 410.0 466.0 439.0 Rest-of-World 331.3 284.4 237.4 Total $ 1,951.6 $ 2,113.0 $ 1,884.3 Total International Sales as a Percentage of Net Sales 30 % 31 % 32 % We transact a portion of our sales in non-U.S. markets in local currencies, while a meaningful portion of our product costs are denominated in U.S. dollars as a result of our U.S. manufacturing operations.
International Operations Non-U.S. sales are set forth in Note 2 – Revenue Recognition and Note 5 – Segment Information in the Notes to Consolidated Financial Statements and are also included in the table below, which details our non-U.S. sales by region: (in millions) 2024 2023 2022 Europe $ 744.4 $ 837.3 $ 904.4 Canada 275.2 373.0 458.2 Asia-Pacific 357.1 410.0 466.0 Rest-of-World 312.8 331.3 284.4 Total $ 1,689.5 $ 1,951.6 $ 2,113.0 Total International Sales as a Percentage of Net Sales 32 % 30 % 31 % We transact a portion of our sales in non-U.S. markets in local currencies, while a meaningful portion of our product costs are denominated in U.S. dollars as a result of our U.S. manufacturing operations.
We strive to offer our employees career-specific tools, skilled apprenticeship programs, and robust on-the-job training opportunities. Our technical career tracks provide development for engineers and technology personnel who will shape our future ACES initiatives. We also incentivize innovation through a long-established inventor recognition award program.
We recognize the challenges of competing for top talent, particularly in technical fields, and strive to offer our employees career-specific tools, skilled apprenticeship programs, and robust on-the-job training opportunities. Our technical career tracks provide development for engineers and technology personnel who will shape our future ACES initiatives. We also incentivize innovation through a long-established inventor recognition award program.
Business Acceleration businesses accounted fo r 8 percent of Boat seg ment net sales in 2023. Business Acceleration's Freedom Boat Club (FBC) is the world's largest boat club network. FBC operates in more than 400 locations across the U.S., Canada, Australia, and Europe, and has nearly 60,000 memberships.
Business Acceleration businesses accounted fo r 13 percent of Boat seg ment net sales in 2024. Business Acceleration's Freedom Boat Club is the world's largest boat club network. Freedom Boat Club operates in more than 400 locations across the U.S., Canada, Australia, New Zealand, and Europe, and has approximately 60,000 memberships.
FBC members pay an upfront initiation fee and ongoing monthly dues in exchange for gaining shared access to their local club’s diverse fleet of boats and reciprocal privileges at all other FBC locations.
M embers pay an upfront initiation fee and ongoing monthly dues in exchange for gaining shared access to their local club’s diverse fleet of boats and reciprocal privileges at all other Freedom Boat Club locations.
We believe that the Boat segment, which had net sales of $1,989.4 million during 2023, is a world leader in the manufacture and sale of pleasure boats.
We believe that the Boat segment, which had net sales of $1,553.5 million during 2024, is a world leader in the manufacture and sale of pleasure boats.
As a result, the strengthening or weakening of the U.S. dollar affects the financial results of our non-U.S. operations. Propulsion non-U.S. sales comprised approximately 43 percent of our non-U.S. sales in 2023. Engine P&A non-U.S. sales comprised approximately 18 percent of our non-U.S. sales in 2023. Navico Group non-U.S. sales comprised approximately 17 percent of our non-U.S. sales in 2023.
As a result, the strengthening or weakening of the U.S. dollar affects the financial results of our non-U.S. operations. Propulsion non-U.S. sales comprised approximately 44 percent of our non-U.S. sales in 2024. Engine P&A non-U.S. sales comprised approximately 21 percent of our non-U.S. sales in 2024. Navico Group non-U.S. sales comprised approximately 19 percent of our non-U.S. sales in 2024.
Our integrated business strategy is supported by a balanced capital strategy that includes critical investments in new products and technology to further our market leadership position, organic growth initiatives, and our ACES and technology strategies while also managing debt levels and maturities, maintaining strong cash and liquidity positions, and continuing to return capital to shareholders through share repurchases and dividends.
Our integrated business strategy is supported by a balanced capital strategy that includes critical investments in new products and technology to further our market leadership position, organic growth initiatives, and our ACES and technology strategies, while also managing debt levels and maturities, maintaining strong cash and liquidity positions, and continuing to return capital to shareholders through dividends and moderate share repurchases. 1 Table of Contents Key brands associated with each of our segments are listed below.
We are continuously and consistently innovating the future of recreational boating through growing service, connectivity, and alternative participation capabilities and businesses. To support our goal, we have established cross-functional and cross-business investments and initiatives, and hire leaders with strong technology experience.
We are continuously and consistently innovating the future of recreational boating through frequent releases of new products, features, and functions; delivering intuitive and seamless solutions; and growing service, connectivity, autonomy, and alternative participation capabilities and businesses. To support our goal, we have established cross-functional and cross-business investments and initiatives, and hire leaders with strong technology experience.
As of December 31, 2023, we own more than: • 1,100 active U.S. patents; • 450 pending U.S. patent applications; • 650 active foreign patents; • 270 pending foreign patent applications; • 370 U.S. registered trademarks; and • 1,800 foreign registered trademarks.
As of December 31, 2024, we own more than: • 1,100 active U.S. patents; • 530 pending U.S. patent applications; • 700 active foreign patents; • 230 pending foreign patent applications; • 370 U.S. registered trademarks; and • 1,800 foreign registered trademarks.
Employee Learning and Development We support career advancement and create a rewarding environment for employees to learn, grow, and perform at their best.
Learning and Development We support career advancement and create a rewarding environment for employees to learn, grow, and perform at their best. We provide opportunities for continuous learning and development, skill building, mentoring, and tuition reimbursement.
Navico Group products include marine electronics, sensors, and control systems, digital control and monitoring systems, instruments, fish finders, sonar, radar, trolling motors, fuel systems, batteries, power management, and electrical systems. Navico Group sells its products to aftermarket distributors and retailers as well as original equipment manufacturers.
Navico Group products include cartography, marine electronics (including sensors, sonar, radar, control and monitoring systems, fish finders, and multifunction displays), trolling motors, batteries, power management and conversion, electrical systems, and other functional components such as water, fuel, lighting, and HVAC solutions. Navico Group sells its products to aftermarket distributors and retailers as well as original equipment manufacturers.
Our Dealers typically carry one or more product categories and are independent companies or proprietors that range in size from small, family-owned businesses to a large, publicly traded corporation with substantial revenues and multiple locations. Some Dealers sell our products exclusively, while a majority also carry competitor and complementary products.
We have over 19,000 active Dealers serving our business segments worldwide. Our Dealers typically carry one or more product categories and are independent companies or proprietors that range in size from small, family-owned businesses to a large, publicly traded corporation with substantial revenues and multiple locations.
We partner with o ur Dealer network to im prove quality, service, distribution, and delivery of parts and accessories to enhance the boating customer's experience.
Some Dealers sell our products exclusively, while a majority also carry competitor and complementary products. We partner with o ur Dealer network to im prove quality, service, distribution, and delivery of parts and accessories to enhance the boating customer's experience.
Brunswick’s SEC Filings are also available on the SEC’s website at http://www.sec.gov. 11 Tab l e of Content s
Brunswick’s SEC Filings are also available on the SEC’s website at http://www.sec.gov. 10 Table of Contents
Please see our annual Sustainability Report (which is not incorporated by reference herein), available on our website, for additional information about our human capital management programs.
We expect our business partners and suppliers to comply with local labor and employment laws wherever they operate. Please see our Sustainability Report (which is not incorporated by reference herein), available on our website, for additional information about our human capital management programs.
Engine P&A sells products such as engine parts and consumables including oils and lubricants, electrical products, boat parts and systems, and also includes our marine parts and accessories distribution businesses. 2 Tab l e of Content s Engine P&A products are designed for and sold mostly to aftermarket retailers, dealers, distributors, and original equipment manufacturers (including Brunswick Boat segment brands) for both marine and non-marine markets.
Engine P&A products are designed for and sold mostly to aftermarket retailers, dealers, distributors, and original equipment manufacturers (including Brunswick Boat segment brands) for both marine and non-marine markets.
Bureau of Labor Statistics for similar businesses and operations. Additionally, we reported no fatalities in 2023. Compensation and Benefits Our compensation philosophy is to encourage performance that creates sustainable, long-term shareholder value; motivates achievement of financial and strategic goals; attracts, retains, and motivates talent; and reinforces our pay-for-performance culture.
Compensation and Benefits Our compensation philosophy is to encourage performance that creates sustainable, long-term shareholder value; motivates achievement of financial and strategic goals; attracts, retains, and motivates talent; and reinforces our pay-for-performance culture. We are committed, and strive to ensure, that employees are paid equitably for their work, regardless of their race or gender.
The Engine P&A distribution businesses are leading distributors of Brunswick and third party marine parts and accessories throughout North America, Europe, and Asia-Pacific, offering same-day or next-day delivery service to a broad array of marine service facilities.
The Engine P&A distribution businesses are leading distributors of Brunswick and third party marine parts and accessories throughout North America, Europe, and Asia-Pacific, offering same-day or next-day delivery service to a broad array of marine service facilities. 2 Table of Contents Navico Group Segment The Navico Group segment, which had net sales of $800.2 million in 2024, designs, develops, manufactures, and markets products and systems for the marine, RV, specialty vehicle, mobile and industrial markets, as well as aftermarket channels.
We are committed, and strive to ensure, that employees are paid equitably for their work, regardless of their race or gender. We offer market-competitive salaries and wages including incentive bonus opportunities for managers and senior individual contributors, an equity incentive program for director-level positions and above, and a discretionary retirement contribution dependent on the Company’s performance.
We offer market-competitive salaries and wages including incentive bonus opportunities for managers and senior individual contributors, an equity incentive program for director-level positions and above, and a discretionary retirement contribution dependent on the Company’s performance. We also provide a range of benefits (varying by country) that includes paid time off, healthcare coverage, wellness initiatives, and financial savings and protection programs.
In addition to floor plan financing, Business Acceleration recently announced the launch of Brunswick Finance, a digital retail finance solution that simplifies the purchase process by leveraging a fully integrated technology platform offering end-to-end integration across the boat buying ecosystem, from applying for pre-qualification to underwriting, finalizing agreements and e-signing for loans.
In addition to floor plan financing, Business Acceleration provides a digital retail finance solution, Brunswick Finance, that simplifies the purchase process from applying for pre-qualification to underwriting, finalizing agreements, and e-signing for loans. Distribution We utilize independent distributors, dealers, and retailers (Dealers) for the majority of our boat sales, sales of parts and accessories, and some sales of marine engines.
Additionally, Mercury Marine received Green Masters status from the Wisconsin Sustainable Business Council for the 13th consecutive year. For more information on our sustainability strategy, programming, data, and goals, we refer you to our annual Sustainability Report (which is not incorporated by reference herein), available on our website at https://www.brunswick.com/corporate-responsibility/sustainability.
Additionally, Brunswick was recognized among Newsweek’s America's Most Responsible Companies and Most Trustworthy Companies in America, as well as Forbes' inaugural list of Most Trusted Companies in America. For more information on our sustainability strategy, programming, data, and goals, we refer you to our annual Sustainability Report (which is not incorporated by reference herein), available on our website at https://www.brunswick.com/corporate-responsibility/sustainability.
These environmental sustainability efforts are integrated into our business strategy and operations. 6 Tab l e of Content s Some of our recent sustainability projects and accomplishments include: Product Management Energy Management Waste Reduction Water Reduction Conservation Mercury Marine expanded the Avator™ electric outboard motor line to include the 20e and 35e, and announced plans for the 75e and 110e.
These environmental sustainability efforts are integrated into our business strategy and operations. 6 Table of Contents During 2024, Mercury Marine again expanded the Avator™ electric outboard motor line to include the 75e and 110e models.
Mercury designs and sells four-stroke outboard engine models ranging from 2.5 to 600 horsepower; Mercury Marine and Mercury Racing manufacture inboard and sterndrive engine models ranging from 115 to 1,550 horsepower. Mercury Marine also manufactures two-stroke, non-DFI (direct fuel injection) engines for certain markets outside the United States and Avator™ electric propulsion systems in models ranging from 7.5e to 110e.
Mercury Marine also manufactures two-stroke, non-DFI (direct fuel injection) engines for certain markets outside the United States and Avator™ electric propulsion systems in models ranging from 7.5e to 110e. In 2023, Brunswick acquired Fliteboard Pty Ltd (Fliteboard), a leader in eFoiling technology, to further enhance our electrification and shared-access strategies.
Any failure to comply with applicable environmental laws, regulations, and contractual obligations could result in fines, suspension of production, the need to alter manufacturing processes, and legal liability, and could negatively affect our competitive position. 7 Tab l e of Content s For further information, refer to Section 1A, Risk Factors, for a discussion of risks related to environmental compliance and to Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements for a description of certain environmental proceedings.
For further information, refer to Section 1A, Risk Factors, for a discussion of risks related to environmental compliance and to Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements for a description of certain environmental proceedings.
Human Capital Resources B runswick is dedicated to creating an inspiring and inclusive work environment that attracts, develops, and retains top talent. This environment unlocks our employees’ potential to continue transforming the marine industry. Employee Information As of December 31, 2023, we employed approximately 17,300 employees, 96 percent of whom were full-time.
Human Capital Resources Brunswick is dedicated to creating an inspiring and inclusive work environment that attracts, develops, and retains top talent. We designed our Employee Value Proposition (EVP) to reflect the shared values that allow our employees to continue to transform the marine industry.
Employee Engagement During 2023, Brunswick again completed a global employee engagement survey, in which approximately 85 percent of employees participated, an increase of three percentage points compared to 2022. Insights from the survey will be used to develop action plans at the manager, facility, division, and corporate level to further enhance employee satisfaction and positive connections to Brunswick.
Insights from the survey will be used to develop action plans at the manager, facility, division, and corporate level to further enhance employee satisfaction and positive connections to Brunswick. 9 Table of Contents We view inclusion and belonging as strategic business initiatives.
Part of employee development includes annual performance feedback and management for all employees, for which we have a standard process that includes opportunities for employee engagement at every stage. We also maintain succession plans that foster internal promotion to key positions. We believe our strong compliance culture plays a central role in our success.
Our employee development activities include a standard annual performance feedback and management process that engages employees at every stage to continue their professional growth. We also prioritize succession planning to foster internal promotion to key positions, ensuring a strong pipeline of talent to meet future business needs.
Our employee base is approximately 65 percent hourly and 35 percent salaried. Temporary and contingent employees (including interns and co-ops) and contractors accounted for approximately 2,300 additional workers. Approximately 2,500 of our U.S. employees belong to labor unions and approximately 1,000 additional employees are members of international unions or work councils.
Employee Information As of December 31, 2024 , we employed approximately 15,000 employees, 95 percent of whom were full-time. Our employee base is approximately 60 percent hourly and 40 percent salaried. Temporary and contingent employees (including interns and co-ops) and contractors accounted for approximately 1,800 additional workers.
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Effective January 1, 2023, the Company changed its management reporting and updated its reportable segments to Propulsion, Engine Parts and Accessories (Engine P&A), Navico Group and Boat to align with our internal operating structure, described further below. 1 Tab l e of Content s Key brands associated with each of our segments are listed below.
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Mercury designs and sells four-stroke outboard engine models ranging from 2.5 to 600 horsepower; Mercury Marine and Mercury Racing manufacture gas and diesel inboard and sterndrive engine models ranging from 115 to 1,550 horsepower.
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In 2023, Brunswick acquired Fliteboard Pty Ltd (Fliteboard), a leader in eFoiling technology, to further enhance our electrification and shared-access strategies. Fliteboard is operated as part of the Propulsion segment. Engine P&A Segment The Engine P&A segment had net sales of $1,199.8 million in 2023.
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Engine P&A Segment The Engine P&A segment had net sales of $1,160.8 million in 2024. Engine P&A sells products such as engine parts and consumables including oils and lubricants, electrical products, boat parts and systems, and also includes our marine parts and accessories distribution businesses.
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Navico Group Segment The Navico Group segment, which had net sales of $914.7 million in 2023, designs, develops, manufactures, and markets products and systems for the marine, RV, specialty vehicle, mobile and industrial markets, as well as aftermarket channels.
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In 2024, Brunswick broadened our ACES strategy through the addition of Boating Intelligence, with the intention to use artificial intelligence to deliver simpler, safer, smarter, and more sustainable products, refocusing our Boating Intelligence Design Lab at the University of Illinois Urbana-Champaign on these initiatives.
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Distribution We utilize independent distributors, dealers, and retailers (Dealers) for the majority of our boat sales, sales of parts and accessories, and some sales of marine engines. We have over 19,000 active Dealers serving our business segments worldwide.
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Brunswick is in the final stages of development and validation of our autonomous docking technology system, with an expected commercial release in 2025. In 2024 we launched over 100 products.
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We continue to develop solutions to further improve boater experiences both by advancing the efficiency and capabilities of our core product lines and through our ACES strategy. We continue to develop and refine future innovative projects through our team at the i-Jet Innovation Lab at the University of Illinois Urbana-Champaign.
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Some highlights include Mercury Marine's new joystick piloting system for single-engine outboards and the Boat Group's launch of the 2024 Harris Crowne, a full keel-up redesign with significant enhancements to the model. Harris Boats also announced the launch of the Cruiser e-210, the brand’s first all-electric pontoon, powered by Mercury’ s innovative and award-winning Avator 35e Outboard.
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In 2023, Mercury Marine unveiled its Avator 7.5e electric outboard at the Consumer Electronics Show in Las Vegas and has since introduced Avator electric propulsion systems up to 110e.
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Freedom Boat Club launched the Apple iOS version of its new member app.
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Mercury Marine also entered into an agreement with Jing-Jin Electric (JJE), an electrified propulsion leader in components, assemblies, and systems for global automotive applications, to collaborate on Mercury's portfolio of electric propulsion solutions. Our Boat Group introduced the new Veer boat brand, intended to support electric propulsion, and Navan by Quicksilver, which combines innovative technology with superior performance.
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Navico Group’s Simrad brand launched the NSX ULTRAWIDE, the world’s first fully-featured ultrawide marine display; Lowrance and Simrad introduced Recon™, an electric-steer trolling motor featuring a unique joystick remote and GPS positioning capability; and Lowrance launched Eagle Eye™, with what we believe is the world’s most accessible all-in-one live sonar solution. 4 Table of Contents Brunswick won numerous awards in 2024 for our groundbreaking products, including: • Multiple NMMA Innovation Awards at the 2024 Miami International Boat Show, including for the Boston Whaler 365 Conquest, Boston Whaler 210 Vantage, and the Mercury Racing 500R outboard engine. • The selection of the all-new Harris Crowne 250 as an NMMA Innovation Award winner in the pontoon category at the Minneapolis boat show. • Boating Magazine's selection of Mercury Racing's 500R outboard as a Boating Marine Power Innovation Award winner. • For the second consecutive year, 11 Boating Industry Magazine Top Product Awards for products across our portfolio. • An IBEX Innovation Award for the newly launched Lenco Pro Control boat stabilization system, and an Honorable Mention for Mercury Marine's Precision Joystick Piloting system.
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Navico Group introduced three new Mastervolt brand larger capacity, lithium-ion deep-cycle supply batteries to provide enhanced power storage capacity in a lighter weight and smaller footprint.
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Other sustainability projects and accomplishments recently completed in Brunswick facility operations include: Energy Management Waste Reduction Water Reduction Mercury Marine completed three solar installations at facilities in Australia and China. Mercury Marine’s European headquarters in Belgium has achieved a certified 95.9% waste diversion rate. Boat Group's Venture facility in Portugal implemented a reuse system for water used in testing protocols.
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Navico Group's Whale brand launched Heat Air, a lightweight, space-efficient, propane-based, heating solution for recreational vehicles. 4 Tab l e of Content s Brunswick won numerous awards in 2023 for our groundbreaking products, including: • National Marine Manufacturers Association (NMMA) and Boating Writers International (BWI) honored our Veer boat brand with a 2023 Minneapolis Innovation Award in the fishing boat category. • Multiple NMMA Innovation Awards at the 2023 Miami International Boat Show, including for the Fathom e-Power System, Lowrance HDS Pro with Active Imaging HD and ActiveTarget 2, and the Sea Ray SLX 260 Outboard. • A record 11 Boating Industry Magazine 2023 Top Product Awards to products across our portfolio.
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Boat Group’s Venture facility in Portugal converted its diesel heating system to a lower carbon emitting natural gas system. Land 'N' Sea Canada attained 90% waste to landfill reduction at all three of its distribution facilities. Boat Group’s Reynosa, Mexico facility further reduced its water consumption by finding additional uses for wastewater sent through an osmosis recovery system.
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Boat Group’s Reynosa, Mexico facility operationalized a solar installation and Mercury Marine announced two small-scale solar installations in Australia. Land 'N' Sea attained 90% waste to landfill reduction at all 13 of its distribution facilities. Mercury's Suzhou, China manufacturing facility converted to a powder paint system, which is expected to reduce water consumption by 8 million gallons per year.
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Mercury Marine’s Plant 4 in Fond du Lac, Wisconsin implemented weekend equipment shutdowns to avoid electricity use of equipment in idle. Navico Group attained a 90% waste-to-landfill reduction at its Ensenada, Mexico facility.
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Lowrance partnered with OzFish, an Australian project to attract new shellfish growth, improve water cleanliness, and increase fish populations. Mercury Marine acquired Fliteboard, a battery-powered e-foil personal watercraft, further bolstering its commitment to electrification. Mercury Marine’s Brownsburg distribution facility received LEED (Leadership in Energy and Environmental Design) Silver certification.
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Mercury Marine's facility in Juarez, Mexico installed a water recycling system which filters water from a cleaning process to be reused multiple times, reducing both water consumption and wastewater. Several Mercury Marine and Boat Group manufacturing facilities completed compressed air audits and implemented identified improvements for electricity reduction.
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Navico Group attained its first 90% waste-to-landfill reduction at its Lowell, MI facility. System improvements at Mercury Marine’s Fond du Lac campus are expected to reduce use of 6 million gallons of water per year. Simrad partnered on fish tagging programs led by Gray Fishtag Research and the Scientific Angler Tagging Tour.
Added
The BLA distribution facility in Queensland, Australia began a waste reduction effort and attained an 85% waste diversion rate. Mercury Marine’s facility in Juarez, Mexico completed an upgrade to 100% LED lighting. In recognition of its sustainability efforts, Brunswick was again listed among USA Today's America's Climate Leaders and Newsweek’s America’s Greenest Companies.
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RELiON launched the RB36V40, a 36V 40Ah marine lithium battery with 20% more energy capacity than its series equivalent. Boat Group introduced a new energy audit program and completed audits at seven primary manufacturing locations. Boat Group’s New York Mills, MN facility converted to a reusable racking system for windshields.
Added
Mercury Marine received the Wisconsin Manufacturers and Commerce 2024 Business Friend of the Environment Award for Environmental Innovation and received Green Masters status from the Wisconsin Sustainable Business Council for the 14th consecutive year.
Removed
Boat Group’s Reynosa, Mexico facility introduced an osmosis wastewater recovery system to reduce water consumption by an estimated 10% per year. Teams of Brunswick employees around the world completed more than 40 conservation-related community service events. Boat Group’s new Navan by Quicksilver features a twin step hull which reduces drag, making the boats faster and more fuel efficient.
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The EVP is built around five key behaviors: • Innovative: Encourages creativity and problem-solving • Driven: Focuses on achieving goals and continuous improvement • Exceptional: Strives for excellence in all endeavors • Authentic: Promotes genuine care and respect for one another • United: Emphasizes collaboration and teamwork 7 Table of Contents We thoughtfully incorporate the EVP into various aspects of our business, and the EVP serves as a cultural anchor behind our purpose and strategy.
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LED lighting upgrades completed at 12 manufacturing facilities. Boat Group's Tellico, TN facility began a recycling program for wood pallets and plastic parts skeletons. The Brunswick Foundation made grants to eight organizations dedicated to marine conservation.
Added
Approximately 1,800 of our U.S. employees belong to labor unions and approximately 1,000 additional employees are members of international unions or work councils. We believe that the relationships among our employees, the unions or work councils, and the Company remain stable. Health and Safety Employee health and safety are top priorities.
Removed
In recognition of its sustainability efforts, Brunswick was listed among Newsweek’s America's Most Responsible Companies for 2023 for the fourth consecutive year, Sustainalytics' “Industry Top Rated” for 2023, Newsweek's inaugural list of America's Greenest Companies and USA Today and Statista's inaugural Climate Leaders List, which recognizes companies' efforts to reduce Scope 1 and Scope 2 greenhouse gas emissions.
Added
Our global recordable incident rate is considerably lower than the benchmarks of the U.S. Bureau of Labor Statistics for similar businesses and operations. Additionally, we reported no occupational fatalities in 2024.
Removed
W e anticipate that increased global regulation relating to climate change, such as climate disclosure requirements or product emissions limitations, will require us to comply or potentially face market access limitations or other penalties, including fines. Our manufacturing operations and products are subject to numerous and increasingly strict federal, state, local, and foreign environmental laws and regulations.
Added
Engagement, Inclusion, and Belonging During 2024, Brunswick again completed a global employee engagement survey, in which approximately 77 percent of employees participated.
Removed
As we evolve our product electrification strategy, we are subject to other regulations and requirements relating to the transportation, storage, handling, and use of batteries and the components used in battery manufacturing.
Added
Each ERG strives to support employees by deepening engagement, unifying and connecting communities, and fostering individual growth. Ethics and Human Rights We believe our strong compliance culture plays a central role in our success. The Integrity Playbook , Brunswick’s code of conduct, serves as the foundation of our Ethics Program.
Removed
Our products are subject to increasingly stringent regulations regarding chemical and material composition, and we are subject to extended producer responsibility laws and regulations requiring manufacturers to be responsible for collection, recovery, and recycling of wastes from certain products.
Added
In 2024, 98 percent of our active global salaried population completed our annual code of conduct training. In addition, we maintain a global ethics hotline for anyone to ask questions or raise concerns, including anonymously, and we forbid retaliation for good faith reports.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

49 edited+8 added−9 removed123 unchanged
Biggest changeWe must carefully manage these capital improvement projects, expansions, efficiency enhancements, and any consolidation or decrease in capacity utilization to ensure the projects meet cost targets, comply with applicable environmental, safety, and other regulations, uphold high-quality workmanship, and meet our business goals.
Biggest changeWe must carefully manage these capital improvement projects, expansions, efficiency enhancements, and any consolidation or decrease in capacity utilization to ensure the projects meet cost targets, comply with applicable environmental, safety, and other regulations, uphold high-quality workmanship, and meet our business goals. 12 Table of Contents Decreasing or ceasing production at a facility, moving production to a different plant, or expanding capacity at an existing facility all involve risks, including difficulties initiating production within the cost and timeframe estimated, supplying product to customers when expected, integrating new products, and attracting and retaining skilled workers.
Our provision for income taxes and cash tax liability may be adversely impacted by changes in tax laws and interpretations in the U.S. or in other countries in which we operate. The Inflation Reduction Act of 2022 (IRA) included various tax provisions, including a 15% minimum tax on global adjusted financial statement income.
Our provision for income taxes and cash tax liability may be adversely impacted by changes in tax laws and interpretations in the U.S. or in other countries in which we operate. The Inflation Reduction Act of 2022 (IRA) included various tax provisions, including a 15 percent minimum tax on global adjusted financial statement income.
If economic conditions deteriorate, we anticipate that dealer failures or voluntary market exits would increase, especially if overall retail demand materially declines. Dealer or distributor inability to secure adequate access to capital could adversely affect our sales. Our dealers require adequate liquidity to finance their operations, including purchasing our products.
If economic conditions deteriorate, we anticipate that dealer failures or voluntary market exits would increase, especially if overall retail demand materially further declines. Dealer or distributor inability to secure adequate access to capital could adversely affect our sales. Our dealers require adequate liquidity to finance their operations, including purchasing our products.
Catastrophic events, including natural and environmental disasters, acts of terrorism, or civil unrest, could have a negative effect on our operations and financial results. Hurricanes, floods, earthquakes, storms, and catastrophic natural or environmental disasters, as well as acts of terrorism or civil unrest, could disrupt our distribution channel, operations, or supply chain and decrease consumer demand.
Catastrophic events, including natural and environmental disasters, acts of terrorism, or civil unrest, could have a negative effect on our operations and financial results. Hurricanes, floods, earthquakes, storms, wildfires, and catastrophic natural or environmental disasters, as well as acts of terrorism or civil unrest, could disrupt our distribution channel, operations, or supply chain and decrease consumer demand.
These risks are exacerbated in the case of single-source suppliers, and the exclusive supplier of a key component could potentially exert significant bargaining power over price, quality, warranty claims, or other terms. We experienced supply shortages and increases in costs to certain materials in 2023.
These risks are exacerbated in the case of single-source suppliers, and the exclusive supplier of a key component could potentially exert significant bargaining power over price, quality, warranty claims, or other terms. We experienced supply shortages and increases in costs to certain materials in 2024.
However, we remain subject to risks, including: • the steps we take to protect our proprietary technology may be inadequate to prevent misappropriation of our technology; • third parties may independently develop similar technology; • agreements containing protections may be breached or terminated; • we may not have adequate remedies for breaches; • existing patent, trademark, copyright, and trade secret laws may afford limited protection; • a third party could copy or otherwise obtain and use our products or technology without authorization; or • we may be required to litigate to enforce our intellectual property rights, and we may not be successful. 21 Tab l e of Content s Policing unauthorized use of our intellectual property is difficult, particularly outside the U.S., and litigating intellectual property claims may result in substantial cost and divert management’s attention.
However, we remain subject to risks, including: • the steps we take to protect our proprietary technology may be inadequate to prevent misappropriation of our technology; • third parties may independently develop similar technology; • agreements containing protections may be breached or terminated; • we may not have adequate remedies for breaches; • existing patent, trademark, copyright, and trade secret laws may afford limited protection; • a third party could copy or otherwise obtain and use our products or technology without authorization; or • we may be required to litigate to enforce our intellectual property rights, and we may not be successful. 20 Table of Contents Policing unauthorized use of our intellectual property is difficult, particularly outside the U.S., and litigating intellectual property claims may result in substantial cost and divert management’s attention.
For example, we provided certain affected individuals credit monitoring as a result of the June IT Security Incident.
For example, we provided certain affected individuals credit monitoring as a result of the IT security incident in June 2023.
RISKS RELATED TO CYBERSECURITY AND TECHNOLOGY Our business operations could be negatively impacted by an outage or breach of our information technology systems, operational technology systems, or a cybersecurity event. We manage our global business operations through a variety of information technology (IT) and operational technology systems which we continually enhance to increase efficiency and security.
RISKS RELATED TO CYBERSECURITY AND TECHNOLOGY Our business operations could be negatively impacted by a system outage caused by a breach of our information technology systems or operational technology systems. We manage our global business operations through a variety of information technology (IT) and operational technology systems which we continually enhance to increase efficiency and security.
Entities affiliated with Wells Fargo & Company, including BAC, our 49 percent owned joint venture, finance a significant portion of our boat and engine sales to dealers through floor plan financing to marine dealers. 18 Tab l e of Content s Many factors continue to influence the availability and terms of financing that our dealer floor plan financing providers offer, including: • their ability to access certain capital markets, such as the securitization and the commercial paper markets, and to fund their operations in a cost effective manner; • the performance of their overall credit portfolios; • their willingness to accept the risks associated with lending to marine dealers; • the overall creditworthiness of those dealers; and • the overall aging and level of pipeline inventories.
Entities affiliated with Wells Fargo & Company, including BAC, our 49 percent owned joint venture, finance a significant portion of our boat and engine sales to dealers through floor plan financing to marine dealers. 17 Table of Contents Many factors continue to influence the availability and terms of financing that our dealer floor plan financing providers offer, including: • their ability to access certain capital markets, such as the securitization and the commercial paper markets, and to fund their operations in a cost effective manner; • the performance of their overall credit portfolios; • their willingness to accept the risks associated with lending to marine dealers; • the overall creditworthiness of those dealers; and • the overall aging and level of pipeline inventories.
If credit conditions worsen and adversely affect the ability of customers to finance potential purchases at acceptable terms and interest rates, it could result in a decrease in sales or delay improvement in sales. 12 Tab l e of Content s Adverse capital market conditions could have a negative impact on our financial results.
If credit conditions worsen and adversely affect the ability of customers to finance potential purchases at acceptable terms and interest rates, it could result in a decrease in sales or delay improvement in sales. Adverse capital market conditions could have a negative impact on our financial results.
In 2023, we repurchased $275.0 million of shares , and we plan to continue share repurchases in 2024 and b eyond. The amount and timing of share repurchases are based on a variety of factors.
In 2024, we repurchased $200.0 million of shares , and we plan to continue share repurchases in 2025 and b eyond. The amount and timing of share repurchases are based on a variety of factors.
Additionally, plant consolidation or expansion can result in manufacturing inefficiencies, additional expenses, including higher wages or severance costs, and cost inefficiencies, which could negatively impact financial results. 13 Tab l e of Content s Loss of key customers could harm our business.
Additionally, plant consolidation or expansion can result in manufacturing inefficiencies, additional expenses, including higher wages or severance costs, and cost inefficiencies, which could negatively impact financial results. Loss of key customers could harm our business.
Conversely, we may make decisions to decrease production at existing facilities or reduce our manufacturing footprint in accordance with our business strategy.
Conversely, in an uncertain economic environment, we may make decisions to decrease production at existing facilities or reduce our manufacturing footprint in accordance with our business strategy.
If we fail to timely and successfully integrate acquired businesses into existing operations, we may see higher costs, lost sales, or otherwise diminished earnings and financial results. 17 Tab l e of Content s There can be no assurance that strategic divestitures or restructurings will provide business benefits.
If we fail to timely and successfully integrate acquired businesses into existing operations, we may see higher costs, lost sales, or otherwise diminished earnings and financial results. 16 Table of Contents There can be no assurance that strategic divestitures or restructurings will provide business benefits.
This or future events could negatively affect our relationships with customers or trading partners, lead to potential claims against us, and damage our image and reputation. 20 Tab l e of Content s We rely on third parties for computing, storage, processing, and similar services.
This or future events could negatively affect our relationships with customers or trading partners, lead to potential claims against us, and damage our image and reputation. 19 Table of Contents We rely on third parties for computing, storage, processing, and similar services.
If our interests are not aligned, it could negatively impact our sales or financial results. 16 Tab l e of Content s RISKS RELATED TO OUR STRATEGIC PLANS Failure to execute our strategic plan and growth initiatives could have a material adverse effect on our business and financial condition.
If our interests are not aligned, it could negatively impact our sales or financial results. 15 Table of Contents RISKS RELATED TO OUR STRATEGIC PLANS Failure to execute our strategic plan and growth initiatives could have a material adverse effect on our business and financial condition.
Over the past several years, we have made strategic capital investments in capacity expansion activities to successfully capture growth opportunities and enhance product offerings, including expansions at our Fond du Lac, Wisconsin and Ensenada, Mexico facilities. We also continue to implement manufacturing efficiency enhancements that are important to our success.
Over the past several years, we have made strategic capital investments in capacity expansion activities to successfully capture growth opportunities and enhance product offerings, and we also continue to implement manufacturing efficiency enhancements that are important to our success.
Compliance with these rules and regulations, and compliance with any changes to current regulations, could increase the cost of our operations. 23 Tab l e of Content s Changes in income tax laws or enforcement could have a material adverse impact on our financial results.
Compliance with these rules and regulations, and compliance with any changes to current regulations, could increase the cost of our operations. 22 Table of Contents Changes in income tax laws or enforcement could have a material adverse impact on our financial results.
Economic uncertainty caused by rising interest rates, inflation, international conflicts, and the macroeconomic environment may lead to unfavorable business outcomes.
Economic uncertainty caused by international conflicts, the risk of inflation, and the macroeconomic environment may lead to unfavorable business outcomes.
As we evolve our product electrification strategy, we are potentially subject to emerging regulations and requirements under the proposed European Union Battery Directive or other similar regulations. These requirements, if adopted, could increase our costs, potentially reducing consumer demand for our products.
As we evolve our product electrification strategy, we are potentially subject to emerging regulations and requirements under the proposed European Union Battery Directive or other similar regulations regarding transportation, storage, handling, and use of batteries and the components used in battery manufacturing. These requirements, if adopted, could increase our costs, potentially reducing consumer demand for our products.
An impairment in the carrying value of goodwill, trade names, and other long-lived assets could negatively affect our consolidated results of operations and net worth.
RISKS RELATED TO OUR REGULATORY, ACCOUNTING, LEGAL, AND TAX ENVIRONMENT An impairment in the carrying value of goodwill, trade names, and other long-lived assets could negatively affect our consolidated results of operations and net worth.
We use an estimate of the related undiscounted cash flow over the remaining life of the asset in measuring whether the asset is recoverable. As of December 31, 2023, the balance of total g oodwill and indefinite lived intangible assets was $1,342.2 million , which represents approximatel y 22 percent of total assets.
We use an estimate of the related undiscounted cash flow over the remaining life of the asset in measuring whether the asset is recoverable. As of December 31, 2024, the balance of total goodwill and indefinite lived intangible assets was $1,270.3 million, which represents approximately 22 percent of total assets.
Inability to fund operations can force dealers to cease business, and we may be unable to obtain alternate distribution in the vacated market. An inability to obtain alternate distribution could unfavorably affect our net sales through reduced market presence.
In particular, reduced cash flow from decreases in sales and tightening credit markets could impair dealers' ability to fund operations. Inability to fund operations can force dealers to cease business, and we may be unable to obtain alternate distribution in the vacated market. An inability to obtain alternate distribution could unfavorably affect our net sales through reduced market presence.
In addition, an uncorrected defect or supplier's variation in a raw material, part, or component, either unknown to us or incompatible with our manufacturing process, could jeopardize our ability to manufacture products. 14 Tab l e of Content s Some additional supply risks that could disrupt our operations, impair our ability to deliver products to customers, and negatively affect our financial results include: • financial pressures on our suppliers due to a weakening economy or unfavorable conditions in other end markets; • supplier manufacturing constraints and investment requirements; • deterioration of our relationships with suppliers; • events such as natural disasters, power outages, or labor strikes; • disruption at major global ports and shipping hubs; or • an outbreak of disease or facility closures due to COVID-19 or a similar public health threat.
Some additional supply risks that could disrupt our operations, impair our ability to deliver products to customers, and negatively affect our financial results include: • financial pressures on our suppliers due to a weakening economy or unfavorable conditions in other end markets; • supplier manufacturing constraints and investment requirements; • deterioration of our relationships with suppliers; • events such as natural disasters, power outages, or labor strikes; • disruption at major global ports and shipping hubs; or • an outbreak of disease or facility closures due to a public health threat.
Our sales could be adversely affected if financing terms change unfavorably or if BAC were to be terminated. This could require dealers to find alternative sources of financing, including our direct financing to dealers, which could require additional capital to fund the associated receivables. Inventory reductions by major dealers, retailers, and independent boat builders could adversely affect our financial results.
Our sales could be adversely affected if financing terms change unfavorably or if BAC were to be terminated. This could require dealers to find alternative sources of financing, including our direct financing to dealers, which could require additional capital to fund the associated receivables.
We could be uniquely affected by weather-related catastrophic events, the severity of which may increase as a result of climate change, due to the location of certain of our boat facilities in coastal Florida, the size of the manufacturing operation in Fond du Lac, Wisconsin, and Freedom Boat Club locations on waterfronts.
We could be uniquely affected by weather-related catastrophic events, the severity of which may increase as a result of climate change, due to the location of certain of our boat facilities in coastal Florida, the size of the manufacturing operation in Fond du Lac, Wisconsin, and Freedom Boat Club locations on waterfronts. 14 Table of Contents Our ability to remain competitive depends on successfully introducing new products, experiences, and services that meet customer expectations.
The impact of such events could include employee illness, quarantines, cancellation of events and travel, business and school shutdowns, reduction in economic activity, and supply chain interruptions, which could cause significant disruptions to global economies and financial markets. In addition, these events could result in future significant volatility in demand, positively or negatively, for one or more of our products.
The impact of such events could include employee illness, quarantines, cancellation of events and travel, business and school shutdowns, reduction in economic activity, and supply chain interruptions, which could cause significant disruptions to global economies and financial markets.
In addition, our cash flow and loss experience could be adversely affected if repurchased inventory is not successfully distributed to other dealers in a timely manner, or if the recovery rate on the resale of the product declines. The finance companies could require changes in repurchase or recourse terms that would result in an increase in our contractual contingent obligations.
In addition, our cash flow and loss experience could be adversely affected if repurchased inventory is not successfully distributed to other dealers in a timely manner, or if the recovery rate on the resale of the product declines.
If demand for our products declines or if new product introductions are expected to replace existing products, our dealers, retailers, and other distributors could decide to reduce the number of units they hold.
Inventory reductions by major dealers, retailers, and independent boat builders driven by weaker demand for our products could adversely affect our financial results. If demand for our products declines or if new product introductions are expected to replace existing products, our dealers, retailers, and other distributors could decide to reduce the number of units they hold.
Such changes have the potential to adversely impact the U.S. economy, our industry, our suppliers, and global demand for our products and, as a result, could have a material adverse effect on our business, financial condition, and results of operations.
Such changes have the potential to adversely impact the U.S. economy, our industry, our suppliers, and global demand for our products and, as a result, could have a material adverse effect on our business, financial condition, and results of operations. 11 Table of Contents Fiscal and monetary policy changes may negatively impact worldwide economic and credit conditions and adversely affect our industries, businesses, and financial condition.
Our ability to remain competitive depends on successfully introducing new products, experiences, and services that meet customer expectations. We believe that our customers look for and expect quality, innovation, and advanced features when evaluating and making purchasing decisions about products and services in the marketplace.
We believe that our customers look for and expect quality, innovation, and advanced features when evaluating and making purchasing decisions about products and services in the marketplace.
Similarly, if a critical supplier were to close its operations, cease manufacturing, or otherwise fail to deliver an essential component necessary to our manufacturing operations, that could detrimentally affect our ability to manufacture and sell our products, resulting in an interruption in business operations and/or a loss of sales.
Similarly, if a critical supplier were to close its operations, cease manufacturing, or otherwise fail to deliver an essential component necessary to our manufacturing operations, that could detrimentally affect our ability to manufacture and sell our products, resulting in an interruption in business operations and/or a loss of sales. 13 Table of Contents In addition, some components used in our manufacturing processes, including certain engine components, furniture, upholstery, and boat windshields, are available from a sole supplier or a limited number of suppliers.
In addition, impairment charges could indicate a reduction in business value which could limit our ability to obtain adequate financing in the future. 22 Tab l e of Content s We manufacture and sell products that create exposure to potential claims and litigation.
In addition, impairment charges could indicate a reduction in business value which could limit our ability to obtain adequate financing in the future. We manufacture and sell products that create exposure to potential claims and litigation. Our manufacturing operations and the products we produce could result in product quality, warranty, personal injury, property damage, and other claims.
We continue to be subject to meaningful tariffs, such as China Section 301 investigation tariffs, and there is no assurance that we will be granted exclusions in the future.
Changes in laws and policies governing trade could adversely affect our business and trigger retaliatory actions by affected countries. We continue to be subject to meaningful tariffs, such as China Section 301 investigation tariffs, and there is no assurance that we will be granted exclusions in the future.
Compliance with environmental, health, safety, zoning, and other laws and regulations may increase costs and reduce demand for our products. We are subject to federal, state, local, and foreign laws and regulations, including product safety, environmental, health and safety, and other regulations.
We are subject to federal, state, local, and foreign laws and regulations, including product safety, environmental, health and safety, and other regulations.
Maintaining a reliable network of dealers is essential to our success. We face competition from other manufacturers in attracting and retaining distributors and independent boat dealers. A significant deterioration in the number or effectiveness of our dealers and distributors could have a material adverse effect on our financial results.
Maintaining a reliable network of dealers is essential to our success. We face competition from other manufacturers in attracting and retaining distributors and independent boat dealers. In addition, dealers or distributors could decide to reduce their level of inventory of our products.
Consumers may pursue other recreational activities if our products are not readily available, consumers may purchase from competitors, or our fixed costs may grow, all of which could adversely impact our results of operations. We have a fixed cost base that can affect our profitability if demand decreases.
Consumers may purchase from competitors or pursue other recreational activities if our products are not readily available, or our fixed costs may grow, all of which could adversely impact our results of operations. Actual or potential public health emergencies, epidemics, or pandemics could have a material adverse effect on our business, results of operations, or financial condition.
It may be difficult to find a replacement supplier for a limited or sole source raw material, part, or component without significant delay or on commercially reasonable terms.
It may be difficult to find a replacement supplier for a limited or sole source raw material, part, or component without significant delay or on commercially reasonable terms. In addition, an uncorrected defect or supplier's variation in a raw material, part, or component, either unknown to us or incompatible with our manufacturing process, could jeopardize our ability to manufacture products.
Although these factors have existed for several years, we do not believe they have had a material adverse effect on our competitive position. Fiscal and monetary policy changes may negatively impact worldwide economic and credit conditions and adversely affect our industries, businesses, and financial condition.
Although these factors have existed for several years, we do not believe they have had a material adverse effect on our competitive position to date. Changes to trade policy, tariffs, and import/export regulations may have a material adverse effect on our business, financial condition, and results of operations.
However, our profitability is dependent, in part, on our ability to absorb fixed costs over an increasing number of products sold and shipped. Decreased demand or the need to reduce inventories can lower our production levels and impact our ability to absorb fixed costs, consequently materially affecting our results.
Decreased demand or the need to reduce inventories can lower our production levels and impact our ability to absorb fixed costs, consequently materially affecting our results. Our ability to meet demand in a rapidly changing environment may adversely affect our results of operations.
We may be unable to successfully implement the growth strategies if our franchisees do not participate in the implementation of those strategies or if we are unable to attract a sufficient number of qualified franchisees. 19 Tab l e of Content s While our franchisees are required to comply with our franchise and related agreements, our franchisees are independent and manage their boat clubs as independent businesses, responsible for all day-to-day operations of their boat clubs.
We may be unable to successfully implement our growth strategies if our franchisees do not participate in the implementation of those strategies or if we are unable to attract a sufficient number of qualified franchisees.
Impact on our operations could also be material, affecting employee absenteeism rates, facility closures, or adverse effects on customers or suppliers. These impacts could have a negative effect on our business, financial condition, and results of operations. Some of our operations are conducted by joint ventures that are not operated solely for our benefit.
In addition, these events could result in future significant volatility in demand, positively or negatively, for one or more of our products and have a negative effect on our business, financial condition, and results of operations. Some of our operations are conducted by joint ventures that are not operated solely for our benefit.
The franchise business model of Freedom Boat Club presents risks. Our franchisees are an integral part of our Freedom Boat Club business and its growth strategies.
The finance companies could require changes in repurchase or recourse terms that would result in an increase in our contractual contingent obligations. 18 Table of Contents The franchise business model of Freedom Boat Club presents risks. Our franchisees are an integral part of Freedom Boat Club business and its growth strategies.
These risks could adversely affect our business and operating results.
These risks could adversely affect our business and operating results. Item 1B. Unresolved Staff Comments None. 23 Table of Contents
The fixed cost levels of operating production facilities can put pressure on profit margins when sales and production decline. We have maintained discipline over our fixed cost base, and improvements in gross margin can help mitigate the risks related to a fixed cost base.
We have maintained discipline over our fixed cost base, and improvements in gross margin can help mitigate the risks related to a fixed cost base. However, our profitability is dependent, in part, on our ability to absorb fixed costs over an increasing number of products sold and shipped.
Our manufacturing operations and the products we produce could result in product quality, warranty, personal injury, property damage, and other issues, thereby increasing the risk of litigation and potential liability as well as regulatory fines. To manage this risk, we have established a global, enterprise-wide program charged with the responsibility for reviewing, addressing, and reporting on product integrity issues.
The adoption of new technologies, such as artificial intelligence or autonomous products, may result in new or enhanced regulations, litigation or liability. To manage these risks, we have established a global, enterprise-wide program charged with the responsibility for reviewing, addressing, and reporting on product integrity issues.
Furthermore, we must continue to meet or exceed customers' expectations regarding product quality, experiences, and after-sales service or our operating results could suffer. 15 Tab l e of Content s Our ability to meet demand in a rapidly changing environment may adversely affect our results of operations.
Furthermore, we must continue to meet or exceed customers' expectations regarding product quality, experiences, and after-sales service or our operating results could suffer. We have a fixed cost base that can affect our profitability if demand decreases. The fixed cost levels of operating production facilities can put pressure on profit margins when sales and production decline.
Our reputation may be adversely affected by such claims, whether or not successful, including potential negative publicity about our products. We record accruals for known potential liabilities, but there is the possibility that actual losses may exceed these accruals and therefore negatively impact earnings.
We record accruals for known potential liabilities, but there is the possibility that actual losses may exceed these accruals and therefore negatively impact earnings. 21 Table of Contents Compliance with environmental, health, safety, zoning, and other laws and regulations may increase costs and reduce demand for our products.
Although at present we believe dealer health to be generally favorable, weakening demand for marine products could hurt our dealers’ financial performance. In particular, reduced cash flow from decreases in sales and tightening credit markets could impair dealers' ability to fund operations.
A significant deterioration in the number or effectiveness of our dealers and distributors, and their inventory levels of our products, could have a material adverse effect on our financial results. Although at present we believe dealer health to be generally favorable, continued weakening demand for marine products could hurt our dealers’ financial performance.
Removed
Moving production to a different plant, expanding capacity at an existing facility, and decreasing or ceasing production at a facility involves risks, including difficulties initiating production within the cost and timeframe estimated, supplying product to customers when expected, integrating new products, and attracting and retaining skilled workers.
Added
In addition, given the new administration's orders and policies yet to be determined, we will likely be subject to significant additional future tariffs related to goods from China, Mexico, Canada, or other jurisdictions, for which there may be no available exclusions, or for which we are not granted exclusions.
Removed
In addition, some components used in our manufacturing processes, including certain engine components, furniture, upholstery, and boat windshields, are available from a sole supplier or a limited number of suppliers.
Added
Competitors may adopt new technologies and technological advancements, such as using artificial intelligence and machine learning to pursue new products, services, and approaches more quickly, successfully and effectively.
Removed
Actual or potential public health emergencies, epidemics, or pandemics, such as COVID-19, could have a material adverse effect on our business, results of operations, or financial condition.
Added
In the future, customers may have fewer hybrid or flexible work opportunities, which could reduce their available recreational time or willingness to purchase our products. These factors and recent economic headwinds could weaken demand for marine products and result in sustained lower dealer stocking levels.
Removed
The COVID-19 pandemic resulted in disruption, uncertainty, and volatility in the global financial and credit markets, and similar future events could do the same. Such volatility could impact our access to capital resources and liquidity in the future, including making credit difficult to obtain or only available on less favorable terms.
Added
While our franchisees are required to comply with franchise and related agreements, our franchisees are independent and manage their boat clubs as independent businesses, responsible for day-to-day operations of their boat clubs.
Removed
RISKS RELATED TO OUR REGULATORY, ACCOUNTING, LEGAL, AND TAX ENVIRONMENT Changes to trade policy, tariffs, and import/export regulations may have a material adverse effect on our business, financial condition, and results of operations. Changes in laws and policies governing trade could adversely affect our business and trigger retaliatory actions by affected countries.
Added
Our reputation may be adversely affected by such claims, whether or not successful, including potential negative publicity about our products, and such claims could divert the efforts of our personnel, even if we are successful in defending them.
Removed
During the year ended December 31, 2023, the Company recorded $16.6 million of intangible asset impairment charges recognized in Restructuring, exit and impairment charges in the Consolidated Statements of Operations, including a $13.0 million impairment of the Navico trade name as a result of declines in forecasted revenues primarily driven by macroeconomic factors and a decline in market conditions.
Added
W e anticipate that increased global regulation relating to climate change, such as climate disclosure requirements, will require us to comply or potentially face market access limitations or other penalties, including fines.
Removed
Further, as part of our required fourth quarter goodwill impairment testing, the estimated fair value of the Navico Group reporting unit was approximately 10 percent in excess of its carrying value, which included goodwill of $599.7 million. Fair value determinations require considerable judgment and are sensitive to changes in underlying assumptions and factors.
Added
Our products are subject to increasingly stringent regulations regarding chemical and material composition, and we are subject to extended producer responsibility laws and regulations requiring manufacturers to be responsible for collection, recovery, and recycling of wastes from certain products.
Removed
As a result, there can be no assurance that the estimates and assumptions made for purposes of the impairment tests will prove to be an accurate prediction of the future.
Added
These requirements could increase our costs or could result in fines, suspension of production, the need to alter manufacturing processes, and legal liability, and could negatively affect our competitive position.
Removed
To the extent future operating results differ from those in our current forecasts, or if the assumptions underlying the discount rates change, it is possible that further impairment charges could be recorded.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

6 edited+4 added−10 removed3 unchanged
Biggest changeThe Audit and Finance Committee (the Committee) is primarily responsible for oversight of Brunswick’s information technology and information security/cybersecurity programs. The Committee is composed of directors with expertise in technology, audit, finance, and compliance, equipping them to effectively oversee the program.
Biggest changeWe also make cybersecurity education and awareness materials available to our suppliers. Brunswick’s Board of Directors (the Board) and its committees are actively engaged in managing cybersecurity risk and overseeing our information security programs. The Audit and Finance Committee (the Committee) is primarily responsible for oversight of our information technology and information security/cybersecurity programs.
To date, Brunswick has not identified any other cyber event or risks from cybersecurity threats that could be considered material, individually or in the aggregate. Notwithstanding our vigilant cybersecurity program, we may not be successful in preventing or mitigating a cybersecurity incident that could have a material adverse effect on us.
In 2024, Brunswick did not identify any cyber events or risks from cybersecurity threats that could be considered material, individually or in the aggregate. Notwithstanding our program, we may not be successful in preventing or mitigating a cybersecurity incident that could have a material adverse effect on us.
For further information, refer to Section 1A, Risk Factors, for a discussion of risks related to cybersecurity and technology. 26 Tab l e of Content s
For further information, refer to Section 1A, Risk Factors for a discussion of risks related to cybersecurity and technology. 24 Table of Contents
The Chief Information Officer (CIO) and/or Chief Information Security Officer (CISO) update the Committee at each of its regularly scheduled meetings. These reports include updates on the Company’s cybersecurity programs and key performance indicators; assessment of the program; emerging risks; policies, procedures, and training; and risk mitigation strategies.
The Committee is composed of directors with expertise in technology, audit, finance, and compliance, equipping them to effectively oversee the program. The CISO updates the Committee at each of its regularly scheduled meetings. These reports include updates on our information security/cybersecurity programs and key performance indicators, assessment of the program, emerging risks, policies, procedures, training, and risk mitigation strategies.
We also actively engage with key vendors, industry participants, and law enforcement communities as part of our continuing efforts to evaluate and improve our program. Internally, our employees are a key part of our program.
We actively engage with key vendors, industry participants, and law enforcement communities as part of our continuing efforts to evaluate and improve our program. Internally, our employees are a key part of our program: Brunswick enables a culture in which security is everyone’s responsibility. Employees are trained through various methods throughout the year, including annual security training.
We conduct information security assessments before onboarding and upon detection of an increase in risk profile. In addition, we require providers to meet appropriate security requirements, controls and responsibilities and include additional security and privacy addenda to our contracts where applicable. We also make available cybersecurity education and awareness materials to our suppliers.
Our regular interactions with third party vendors and suppliers pose a potential cybersecurity risk that could adversely impact our business or employees. We conduct information security assessments before onboarding. In addition, we require providers to meet appropriate security requirements, controls, and responsibilities, and include additional security and privacy addenda to our contracts where applicable.
Removed
Our mature cybersecurity program has been strategically designed to assess, identify, and manage these cyber risks, protect the organization, respond to, and recover from cybersecurity incidents. Brunswick’s Board of Directors (the Board) and its committees are actively engaged in managing cybersecurity risk and overseeing our information security programs.
Added
Brunswick’s cybersecurity risk management program is managed by a dedicated cybersecurity team. The team is led by the Chief Information Security Officer (CISO), who reports directly to the Chief Executive Officer (CEO) and the Chief Information Officer (CIO), and has over 20 years of experience in information security, cybersecurity, and IT risk management.
Removed
The underlying controls of our cyber risk management program are based on recognized best practices and standards for cybersecurity and information technology, including the National Institute of Standards and Technology (NIST) Cybersecurity Framework (CSF).
Added
Brunswick’s CISO holds a BBA, majoring in Accounting and Management Information Systems, and an MBA in Strategy and General Management. The CISO is supported by a leadership team with backgrounds in cybersecurity, risk management, and other related capabilities. Brunswick’s cybersecurity risk management program leverages the National Institute of Standards and Technology (NIST) framework as guidance for the program.
Removed
A dedicated Office of the CISO, which reports to the CIO, is responsible for developing enterprise-wide cybersecurity strategy, architecture, policies, processes, and controls, and is directly responsible for our cybersecurity program. Our cybersecurity team members have extensive information technology and program management experience.
Added
The team regularly assesses the threat landscape to manage risks through a layered cybersecurity strategy based on prevention, detection, and containment, including processes for escalating information about threats or cyber incidents to management and the Board of Directors.
Removed
The CIO and/or CISO personnel regularly inform the Chief Executive Officer (CEO) and other members of senior management about the program, best practices, current cybersecurity threats, the risk landscape, and mitigation approaches.
Added
We have other policies and procedures that directly or indirectly relate to cybersecurity, including those related to remote access monitoring, encryption, antivirus protection, multifactor authentication, confidential information, and the use of the internet, email, and wireless devices. The Company also engages third parties in connection with the assessment of our cybersecurity risk management processes against the NIST framework.
Removed
We use various tools and methodologies to identify, manage, and test for cybersecurity risk on a regular cadence both at the enterprise level and using third party service providers.
Removed
These third parties include cybersecurity managed security service providers (MSSPs), consultants, advisors, and auditors, who we engage to evaluate our controls, whether through penetration testing, independent audits, or consulting on best practices to address new threats or challenges.
Removed
All employees are required to complete cybersecurity training at least once every year, and employees in certain roles must complete additional, specialized cybersecurity training on a regular basis. Our regular interactions with third party vendors and suppliers also pose a cybersecurity risk that could adversely impact our business or employees.
Removed
The Office of the CISO continually works to enhance our robust enterprise security structure with the ultimate goal of preventing cybersecurity incidents to the extent feasible, while simultaneously increasing our system resilience in an effort to minimize the business impact should an incident occur. We have an established playbook to promptly detect, assess, and respond to cyber incidents.
Removed
Depending on the nature and severity of an incident, this process provides for escalating notification to functional leaders, senior management, our CEO, and the Board. 25 Tab l e of Content s On June 13, 2023, Brunswick disclosed an IT security incident that impacted some systems and global facilities.
Removed
We activated our response protocols, including pausing operations in some locations, engaging leading security experts, and coordinating with relevant law enforcement agencies. Normal global business operations resumed over the course of nine days following the incident. We estimate the incident resulted in lost revenue of approximately $80 million to $85 million and operating earnings of $35 million to $40 million.

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed2 unchanged
Biggest changeOur principal properties are as follows: Segment Location Primary Use Ownership Mettawa, IL (US) Corporate headquarters Leased Propulsion and Engine P&A Fond du Lac, WI (US) Manufacturing and office Owned Propulsion and Engine P&A Melbourne, Australia Distribution and office Leased Propulsion, Engine P&A and Boat Petit-Rechain, Belgium Distribution and office Owned Propulsion and Engine P&A Suzhou, China Manufacturing, distribution, office Owned/Leased Propulsion, Engine P&A, Navico Group and Boat Auckland, New Zealand Manufacturing, light assembly, engineering, distribution, office Leased Propulsion and Engine P&A Juarez, Mexico Light assembly and distribution Owned/Leased Engine P&A Brisbane, Australia Distribution Leased Engine P&A Brownsburg, IN (US) Distribution Leased Engine P&A Heerenveen, Netherlands Distribution Leased Navico Group Lowell, MI (US) Manufacturing and office Leased Navico Group Menomonee Falls, WI (US) Light assembly, distribution, office Leased Navico Group Stuart, FL (US) Manufacturing and distribution Owned Navico Group Ensenada, Mexico Manufacturing and distribution Owned Navico Group Amsterdam, Netherlands Engineering, distribution, office Leased Boat Edgewater, FL (US) Manufacturing Owned Boat Palm Coast, FL (US) Manufacturing Owned Boat Merritt Island, FL (US) Manufacturing Owned Boat Venice, FL (US) Office Leased Boat Fort Wayne, IN (US) Manufacturing Owned Boat New York Mills, MN (US) Manufacturing Owned Boat Lebanon, MO (US) Manufacturing Owned Boat Knoxville, TN (US) Office Leased Boat Vonore, TN (US) Manufacturing Owned Boat Princeville, Quebec, Canada Manufacturing Owned Boat Reynosa, Mexico Manufacturing Owned Boat Vila Nova de Cerveira, Portugal Manufacturing Owned
Biggest changeOur principal properties are as follows: Segment Location Primary Use Ownership All Segments Mettawa, IL (US) Corporate headquarters Leased Propulsion and Engine P&A Fond du Lac, WI (US) Manufacturing and office Owned Propulsion and Engine P&A Melbourne, Australia Distribution and office Leased Propulsion, Engine P&A and Boat Petit-Rechain, Belgium Distribution and office Owned Propulsion and Engine P&A Suzhou, China Manufacturing, distribution, office Owned/Leased Propulsion, Engine P&A, Navico Group and Boat Auckland, New Zealand Manufacturing, light assembly, engineering, distribution, office Leased Propulsion and Engine P&A Juarez, Mexico Light assembly and distribution Owned/Leased Engine P&A Brisbane, Australia Distribution Leased Engine P&A Brownsburg, IN (US) Distribution Leased Engine P&A Heerenveen, Netherlands Distribution Leased Navico Group Lowell, MI (US) Manufacturing and office Leased Navico Group Menomonee Falls, WI (US) Light assembly, distribution, office Leased Navico Group Stuart, FL (US) Manufacturing and distribution Owned Navico Group Ensenada, Mexico Manufacturing and distribution Owned Navico Group Amsterdam, Netherlands Engineering, distribution, office Leased Boat Edgewater, FL (US) Manufacturing Owned Boat Palm Coast, FL (US) Manufacturing Owned Boat Merritt Island, FL (US) Manufacturing Owned Boat Venice, FL (US) Office Leased Boat Fort Wayne, IN (US) Manufacturing Owned Boat New York Mills, MN (US) Manufacturing Owned Boat Lebanon, MO (US) Manufacturing Owned Boat Knoxville, TN (US) Office Leased Boat Vonore, TN (US) Manufacturing Owned Boat Princeville, Quebec, Canada Manufacturing Owned Boat Reynosa, Mexico Manufacturing Owned Boat Vila Nova de Cerveira, Portugal Manufacturing Owned

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

10 edited+1 added−4 removed5 unchanged
Biggest changeDekker served as Brunswick's Associate General Counsel, with responsibilities for litigation, employment, and compliance matters, from the start of his employment with Brunswick in 2010. Aine L. Denari has served as Executive Vice President and President – Brunswick Boat Group since October 2020. Prior to joining Brunswick, Ms.
Biggest changeDekker has served as Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer since 2014. Prior to his appointment, Mr. Dekker served as Brunswick's Associate General Counsel, with responsibilities for litigation, employment, and compliance matters, from the start of his employment with Brunswick in 2010. Aine L.
Denari worked at ZF AG as Senior Vice President and General Manager, Global Electronics ADAS (Advanced Driver Assistance Systems) from December 2017 to October 2020, as Senior Vice President, Planning and Business Development from 2015 to 2017, and as Vice President, Business Development and Product Planning from 2014 to 2017. Ms.
Denari worked at ZF AG as Senior Vice President and General Manager, Global Electronics ADAS (Advanced Driver Assistance Systems) from 2017 to 2020, as Senior Vice President, Planning and Business Development from 2015 to 2017, and as Vice President, Business Development and Product Planning from 2014 to 2017. Ms.
She previously held the role of Chief Human Resources Officer from 2016 to 2021. Ms. Preisser has served in a variety of roles of increasing responsibility since she started with Brunswick in 2004. Jill M. Wrobel was named Executive Vice President and Chief Human Resources Officer in December 2021. Ms.
She held the role of Chief Human Resources Officer from 2016 to 2021. Ms. Preisser has served in a variety of roles of increasing responsibility since she started with Brunswick in 2004. 26 Table of Contents Jill M. Wrobel was named Executive Vice President and Chief Human Resources Officer in December 2021. Ms.
Altman Senior Vice President and Controller 2019 52 The executive officers named above have been appointed to serve until their successors are chosen and qualified or until the executive officer's earlier resignation or removal. David M. Foulkes was named Chief Executive Officer of Brunswick in 2019.
Wrobel Executive Vice President and Chief Human Resources Officer 2021 44 Randall S. Altman Senior Vice President and Controller 2019 53 The executive officers named above have been appointed to serve until their successors are chosen and qualified or until the executive officer's earlier resignation or removal. David M. Foulkes was named Chief Executive Officer of Brunswick in 2019.
Previously, he served as Vice President – Finance and Treasurer from June 2019 to June 2020, and Vice President – Investor Relations from 2017 to 2019. Mr. Gwillim served as Associate General Counsel - International from 2015 to 2017 and held positions of increasing responsibility within the Legal Department since his Brunswick employment began in 2011. John G.
Previously, he served as Vice President – Finance and Treasurer from 2019 to 2020, and Vice President – Investor Relations from 2017 to 2019. Mr. Gwillim held positions of increasing responsibility within the Brunswick Legal Department since his employment began in 2011. John G. Buelow was named Executive Vice President and President – Mercury Marine in February 2023.
Buelow was named Executive Vice President and President – Mercury Marine in February 2023. He previously served as Vice President of Global Operations, Mercury Marine, from June 2018 to February 2023, and as Vice President Category Management, Mercury Marine, from 2016 to 2018. Prior to 2016, Mr.
He previously served as Vice President of Global Operations, Mercury Marine, from June 2018 to February 2023, and as Vice President Category Management, Mercury Marine, from 2016 to 2018. Prior to 2016, Mr. Buelow served in a variety of positions of increasing responsibility at Mercury Marine since he was hired in 2004. Christopher F.
Altman has held a series of roles of increasing responsibility within Brunswick since he joined Brunswick in 2003. 29 Tab l e of Content s PART II
Altman has held a series of roles of increasing responsibility within Brunswick since he joined Brunswick in 2003. 27 Table of Contents PART II
Item 4. Mine Safety Disclosures Not applicable. 27 Tab l e of Content s Information About Our Executive Officers Brunswick's Executive Officers are listed in the following table: Officer Name Present Position First Became an Executive Officer Age David M. Foulkes Chief Executive Officer 2019 62 Ryan M.
Item 4. Mine Safety Disclosures Not applicable. 25 Table of Contents Information About Our Executive Officers Brunswick's Executive Officers are listed in the following table: Officer Name Present Position First Became an Executive Officer Age David M. Foulkes Chief Executive Officer 2019 63 Ryan M. Gwillim Executive Vice President and Chief Financial and Strategy Officer 2020 45 John G.
Denari previously served in a variety of executive positions within the automotive industry, and in leadership positions at major global consulting firms. Brett A. Dibkey has served as Executive Vice President and President – Navico Group since July 2022 and previously served as Executive Vice President and President – Advanced Systems Group from 2020 to 2022. Mr.
Denari previously served in a variety of executive positions within the automotive industry, and in leadership positions at major global consulting firms. Brenna D. Preisser has served in her role as Executive Vice President and President – Brunswick Boat Group since August 2024. She previously served as Executive Vice President and President – Business Acceleration since 2020.
Gwillim Executive Vice President and Chief Financial and Strategy Officer 2020 44 John G. Buelow Executive Vice President and President — Mercury Marine 2023 53 Christopher F. Dekker Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer 2014 55 Aine L. Denari Executive Vice President and President — Brunswick Boat Group 2020 51 Brett A.
Buelow Executive Vice President and President — Mercury Marine 2023 54 Christopher F. Dekker Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer 2014 56 Aine L. Denari Executive Vice President and President — Navico Group and Chief Technology Officer 2020 52 Brenna D. Preisser Executive Vice President and President — Brunswick Boat Group 2016 47 Jill M.
Removed
Dibkey Executive Vice President and President — Navico Group 2020 51 Brenna D. Preisser Executive Vice President and President — Business Acceleration 2016 46 Jill M. Wrobel Executive Vice President and Chief Human Resources Officer 2021 43 Randall S.
Added
Denari was named Executive Vice President and President – Navico Group and Chief Technology Officer in August 2024. She had served as Executive Vice President and President – Brunswick Boat Group since October 2020. Prior to joining Brunswick, Ms.
Removed
Buelow served in a variety of positions of increasing responsibility at Mercury Marine since he was hired in 2004. Christopher F. Dekker has served as Executive Vice President, General Counsel, Secretary, and Chief Compliance Officer since 2014. Prior to his appointment, Mr.
Removed
Dibkey joined Brunswick following 12 years at Whirlpool Corporation, a multinational manufacturer and marketer of home appliances, where he served as Vice President and General Manager, Business Units, Brand Marketing, eCommerce, and IoT from January 2017 to December 2019, Vice President and General Manager, Integrated Business Units from 2012 to 2020, and General Manager, Dishwasher Category and New Business Development from 2007 to 2012.
Removed
Prior to his career at Whirlpool, Mr. Dibkey worked in a variety of business development and strategic planning roles for Pfizer and Crowe Horwath, LLP. 28 Tab l e of Content s Brenna D. Preisser has served in her role as Executive Vice President and President – Business Acceleration since 2020.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+0 added−0 removed3 unchanged
Biggest changeOn January 30, 2024, our Board of Directors approved a $500.0 million increase to our share repurchase authorization. 30 Tab l e of Content s During the three months ended December 31, 2023, we repurchased the following shares of common stock: Period Total Number of Shares Purchased Weighted Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Amount of Dollars that May Yet Be Used to Purchase Shares Under the Program October 1 to October 28 134,197 $ 74.52 134,197 October 29 to November 25 394,467 70.88 394,467 November 26 to December 31 197,118 86.45 197,118 Total 725,782 75.78 725,782 $ 121,468,669 Item 6.
Biggest changeDuring 2024, we repurchased $200.0 million of stock and as of December 31, 2024, the remaining authorization under the share repurchase program was $421.5 million. 28 Table of Contents During the three months ended December 31, 2024, we repurchased the following shares of common stock: Period Total Number of Shares Purchased Weighted Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Program Maximum Amount of Dollars that May Yet Be Used to Purchase Shares Under the Program September 29 to October 26 121,746 $ 82.14 121,746 October 27 to November 23 — — — November 24 to December 31 — — — Total 121,746 82.14 121,746 $ 421,468,944 Item 6.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Brunswick's common stock is traded on the New York and Chicago Stock Exchanges under the symbol "BC". As of February 14, 2024, there were 6,418 shareholders of record of our common stock.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Brunswick's common stock is traded on the New York and Chicago Stock Exchanges under the symbol "BC". As of February 10, 2025, there were 6,114 shareholders of record of our common stock.
Performance Graph Comparison of Cumulative Total Shareholder Return among Brunswick, S&P 400 Index and S&P 400 Global Industry Classification Standard (GICS) Consumer Discretionary Index 2018 2019 2020 2021 2022 2023 Brunswick 100.00 131.24 169.24 224.46 165.54 225.78 S&P 400 GICS Consumer Discretionary Index 100.00 81.92 103.17 171.32 135.32 169.26 S&P 400 Index 100.00 89.02 112.50 156.48 136.29 160.05 The basis of comparison is a $100 investment made on December 31, 2018 in each of: (i) Brunswick, (ii) the S&P 400 GICS Consumer Discretionary Index and (iii) the S&P 400 Index.
Performance Graph Comparison of Cumulative Total Shareholder Return among Brunswick, S&P 400 Index and S&P 400 Global Industry Classification Standard (GICS) Consumer Discretionary Index 2019 2020 2021 2022 2023 2024 Brunswick 100.00 128.96 171.03 126.14 172.04 117.40 S&P 400 GICS Consumer Discretionary Index 100.00 125.94 209.13 165.18 206.61 224.22 S&P 400 Index 100.00 125.87 175.79 153.10 179.79 202.67 The basis of comparison is a $100 investment made on December 31, 2019 in each of: (i) Brunswick, (ii) the S&P 400 GICS Consumer Discretionary Index and (iii) the S&P 400 Index.
Issuer Purchases of Equity Securities On July 19, 2022, our Board of Directors approved a $500.0 million increase to our share repurchase authorization. In 2023, we repurchased $275.0 million of stock under this authorization and as of December 31, 2023, the remaining authorization was $121.5 million.
Issuer Purchases of Equity Securities On both July 19, 2022 and January 30, 2024, our Board of Directors approved $500.0 million increases to our outstanding share repurchase authorization.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

66 edited+7 added−49 removed36 unchanged
Biggest changeThe table below summarizes the impact of changes in currency exchange rates and also the impact of acquisitions on our net sales: Net Sales 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 GAAP Currency Impact Acquisitions Impact GAAP Currency Impact Acquisitions Impact Propulsion $ 2,763.8 $ 2,824.0 $ 2,504.7 (2.1)% (0.2)% 0.4% 12.7% (2.4)% —% Engine P&A 1,199.8 1,310.2 1,371.7 (8.4)% (0.4)% —% (4.5)% (1.9)% —% Navico Group 914.7 1,069.3 688.3 (14.5)% —% —% 55.4% (3.0)% 55.0% Boat 1,989.4 2,119.4 1,703.1 (6.1)% (0.1)% 1.0% 24.4% (1.7)% 3.0% Segment Eliminations (466.3) (510.7) (421.6) (8.7)% (0.2)% —% 21.1% (1.0)% 3.8% Total $ 6,401.4 $ 6,812.2 $ 5,846.2 (6.0)% (0.1)% 0.4% 16.5% (2.2)% 7.1% 32 Tab l e of Content s Results of Operations Consolidated The following table sets forth certain amounts, ratios and relationships calculated from the Consolidated Statements of Operations for 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions, except per share data) 2023 2022 2021 $ % $ % Net sales $ 6,401.4 $ 6,812.2 $ 5,846.2 $ (410.8) (6.0)% $ 966.0 16.5% Gross margin (A) 1,787.0 1,947.2 1,666.0 (160.2) (8.2)% 281.2 16.9% Restructuring, exit and impairment charges 54.7 25.1 0.8 29.6 NM 24.3 NM Operating earnings 734.9 947.8 812.9 (212.9) (22.5)% 134.9 16.6% Loss on early extinguishment of debt — (0.1) (4.2) 0.1 NM 4.1 (97.6)% Transaction financing charges — — (4.0) — NM 4.0 NM Net earnings from continuing operations 432.6 681.3 595.4 (248.7) (36.5)% 85.9 14.4% Diluted earnings per share from continuing operations $ 6.13 $ 9.06 $ 7.59 $ (2.93) (32.3)% $ 1.47 19.4% Expressed as a percentage of Net sales: Gross margin (A) 27.9 % 28.6 % 28.5 % (70) bps 10 bps Selling, general and administrative expense 12.7 % 11.3 % 11.9 % 140 bps (60) bps Research and development expense 2.9 % 3.0 % 2.6 % (10) bps 40 bps Operating margin 11.5 % 13.9 % 13.9 % (240) bps — bps NM = not meaningful bps = basis points (A) Gross margin is defined as Net sales less Cost of sales as presented in the Consolidated Statements of Operations.
Biggest changeThe table below summarizes the impact of changes in currency exchange rates and also the impact of acquisitions on our net sales: Net Sales 2024 vs. 2023 (in millions) 2024 2023 GAAP Currency Impact Acquisitions Impact Propulsion $ 2,074.2 $ 2,763.8 (25.0)% (0.4)% 1.2% Engine P&A 1,160.8 1,199.8 (3.3)% (0.3)% —% Navico Group 800.2 914.7 (12.5)% 0.1% —% Boat 1,553.5 1,989.4 (21.9)% —% 0.6% Segment Eliminations (351.6) (466.3) (24.6)% —% —% Total $ 5,237.1 $ 6,401.4 (18.2)% (0.2)% 0.7% 30 Table of Contents Results of Operations Consolidated The following table sets forth certain amounts, ratios and relationships calculated from the Consolidated Statements of Operations for 2024 and 2023: 2024 vs. 2023 (in millions, except per share data) 2024 2023 $ % Net sales $ 5,237.1 $ 6,401.4 $ (1,164.3) (18.2)% Gross margin (A) 1,350.8 1,787.0 (436.2) (24.4)% Restructuring, exit and impairment charges 121.7 54.7 67.0 NM Operating earnings 311.6 734.9 (423.3) (57.6)% Loss on early extinguishment of debt (12.7) — (12.7) NM Net earnings from continuing operations 149.3 432.6 (283.3) (65.5)% Diluted earnings per common share from continuing operations $ 2.21 $ 6.13 $ (3.92) (63.9)% Expressed as a percentage of Net sales: Gross margin (A) 25.8 % 27.9 % (210) bps Selling, general and administrative expense 14.3 % 12.7 % 160 bps Research and development expense 3.2 % 2.9 % 30 bps Restructuring, exit and impairment charges 2.3 % 0.9 % 140 bps Operating margin 5.9 % 11.5 % (560) bps NM = not meaningful bps = basis points (A) Gross margin is defined as Net sales less Cost of sales as presented in the Consolidated Statements of Operations.
To determine this information, net sales transacted in currencies other than U.S. dollars have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period.
To determine this information, net sales transacted in currencies other than the U.S. dollar have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period.
The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 23 percent of our annual net sales are transacted in a currency other than the U.S. dollar.
The percentage change in net sales expressed on a constant currency basis better reflects the changes in the underlying business trends, excluding the impact of translation arising from foreign currency exchange rate fluctuations. Approximately 25 percent of our annual net sales are transacted in a currency other than the U.S. dollar.
We recognize revenue related to the sale of extended warranty contracts that extend the coverage period beyond the standard warranty period over the life of the extended warranty period. Revenue is measured as the amount of consideration expected to be entitled to in exchange for transferring goods or providing services.
We recognize revenue related to the sale of extended warranty contracts that extend the coverage period beyond the standard warranty period over the life of the extended warranty period. 39 Table of Contents Revenue is measured as the amount of consideration expected to be entitled to in exchange for transferring goods or providing services.
Financial Services Refer to Note 8 – Financing Joint Venture in the Notes to Consolidated Financial Statements for more information about our financial services. Off-Balance Sheet Arrangements Guarantees. We have reserves to cover potential losses associated with guarantees and repurchase obligations based on historical experience and current facts and circumstances.
Financial Services Refer to Note 8 – Financing Joint Venture in the Notes to Consolidated Financial Statements for more information about our financial services. 38 Table of Contents Off-Balance Sheet Arrangements Guarantees. We have reserves to cover potential losses associated with guarantees and repurchase obligations based on historical experience and current facts and circumstances.
See Note 10 – Income Taxes in the Notes to Consolidated Financial Statements for a reconciliation of our effective tax rate and statutory Federal income tax rate. Due to the factors described in the preceding paragraphs, operating earnings, net earnings from continuing operations and diluted earnings per common share from continuing operations increased during 2022.
See Note 10 – Income Taxes in the Notes to Consolidated Financial Statements for a reconciliation of our effective tax rate and statutory Federal income tax rate. Due to the factors described in the preceding paragraphs, Operating earnings, Net earnings from continuing operations, and Diluted earnings per common share from continuing operations decreased during 2024.
Management believes that this financial measure and the information it provides are useful to investors because it permits investors to view our performance using the same metric that we use to gauge progress in achieving our goals.
We believe that this financial measure and the information it provides are useful to investors because it permits investors to view our performance using the same metric that we use to gauge progress in achieving our goals.
See Note 3 – Restructuring, Exit and Impairment Activities in the Notes to Consolidated Financial Statements for further details. We recognized equity (loss) earnings of $(11.4) million and $4.0 million in 2023 and 2022, respectively. The primary driver of the loss in 2023 is the impairment charge taken related to our investment in TN-BC Holdings LLC.
See Note 3 – Restructuring, Exit and Impairment Activities in the Notes to Consolidated Financial Statements for further details. We recognized Equity earnings (loss) of $8.6 million and $(11.4) million in 2024 and 2023, respectively. The primary driver of the loss in 2023 is the impairment charge taken related to our investment in TN-BC Holdings LLC.
International sales decreased 12 percent year-over-year on a GAAP and on a constant currency basis.
International sales decreased 5 percent year-over-year on a GAAP and constant currency basis.
(D) Amounts primarily represent long-term deferred compensation plans. (E) Other long-term liabilities primarily includes long-term warranty contracts, future projected payments related to our nonqualified pension plans and deferred revenue. 43 Tab l e of Content s Legal Proceedings See Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements.
(D) Amounts primarily represent long-term deferred compensation plans. (E) Other long-term liabilities primarily includes long-term warranty contracts, future projected payments related to our nonqualified pension plans and deferred revenue. Legal Proceedings See Note 11 – Commitments and Contingencies in the Notes to Consolidated Financial Statements.
Please refer to Note 1 – Significant Accounting Policies in the Notes to the Consolidated Financial Statements for further details. 31 Tab l e of Content s Change in Reportable Segments Effective January 1, 2023, the Company changed its management reporting and updated its reportable segments to Propulsion, Engine Parts and Accessories (Engine P&A), Navico Group and Boat to align with its internal operating structure.
Please refer to Note 1 – Significant Accounting Policies in the Notes to the Consolidated Financial Statements for further details. Change in Reportable Segments Effective January 1, 2023, the Company changed its management reporting and updated its reportable segments to Propulsion, Engine Parts and Accessories (Engine P&A), Navico Group and Boat to align with its internal operating structure.
We believe that the non-GAAP financial measure "Total liquidity" is also useful to investors because it is an indication of our available highly liquid assets and immediate sources of financing. Cash, cash equivalents and marketable securities totaled $468.6 million as of December 31, 2023, a decrease of $131.5 million from $600.1 million as of December 31, 2022.
We believe that the non-GAAP financial measure "Total liquidity" is also useful to investors because it is an indication of our available highly liquid assets and immediate sources of financing. Cash, cash equivalents and marketable securities totaled $269.8 million as of December 31, 2024, a decrease of $198.8 million from $468.6 million as of December 31, 2023.
Cash Flow, Liquidity and Capital Resources The following table sets forth an analysis of free cash flow for the years ended December 31, 2023, 2022 and 2021: (in millions) 2023 2022 2021 Net cash provided by operating activities of continuing operations $ 745.2 $ 580.4 $ 586.2 Net cash (used for) provided by: Plus: Capital expenditures (289.3) (388.3) (267.1) Plus: Proceeds from the sale of property, plant and equipment 14.8 11.3 7.2 Plus: Effect of exchange rate changes on cash and cash equivalents 2.7 (11.9) (5.5) Total free cash flow from continuing operations (A) $ 473.4 $ 191.5 $ 320.8 (A) We define "Free cash flow" as cash flow from operating and investing activities of continuing operations (excluding cash provided by or used for acquisitions, investments, purchases or sales/maturities of marketable securities and other investing activities, net of tax) and the effect of exchange rate changes on cash and cash equivalents.
Cash Flow, Liquidity and Capital Resources The following table sets forth an analysis of free cash flow for the years ended December 31, 2024 and 2023: (in millions) 2024 2023 Net cash provided by operating activities of continuing operations $ 449.5 $ 745.2 Net cash (used for) provided by: Plus: Capital expenditures (167.4) (289.3) Plus: Proceeds from the sale of property, plant and equipment 15.0 14.8 Plus: Effect of exchange rate changes on cash and cash equivalents (12.8) 2.7 Total free cash flow (A) $ 284.3 $ 473.4 (A) We define "Free cash flow" as cash flow from operating and investing activities of continuing operations (excluding cash provided by or used for acquisitions, investments, purchases or sales/maturities of marketable securities and other investing activities, net of tax) and the effect of exchange rate changes on cash and cash equivalents.
Total debt as of December 31, 2023 and December 31, 2022 was $2,430.4 million and $2,509.0 million, respectively. Our debt-to-capitalization ratio decreased to 54 percent as of December 31, 2023 from 55 percent as of December 31, 2022. There were no borrowings under the Revolving Credit Agreement (Credit Facility) during 2023.
Total debt as of December 31, 2024 and December 31, 2023 was $2,340.6 million and $2,430.4 million, respectively. Our debt-to-capitalization ratio was 55 percent and 54 percent as of December 31, 2024 and December 31, 2023, respectively. There were no borrowings under the Revolving Credit Agreement (Credit Facility) during 2024.
In performing this qualitative analysis, we consider various factors, including the effect of market or industry changes and the reporting units' actual results compared with projected results.
In performing this qualitative analysis, we consider various factors, including the effect of market or industry changes and the reporting units' actual results compared with projected results. We exercise judgment when evaluating the impact of market and industry changes and when comparing actual results to projected results.
International sales decreased 4 percent year-over-year on a GAAP basis and 3 percent on a constant currency basis.
International sales decreased 15 percent year-over-year on a GAAP basis and 14 percent on a constant currency basis.
International sales increased 6 percent year-over-year on a GAAP basis and 13 percent on a constant currency basis.
International sales increased slightly year-over-year on a GAAP basis and increased 1 percent on a constant currency basis.
The components of the Engine P&A segment's net sales change were as follows: Percent change in net sales compared to the prior year 2022 Volume (11.7) % Product Mix and Price 9.1 % Currency (1.9) % (4.5) % International sales were 30 percent of the Engine P&A segment's net sales in 2022 .
The components of the Engine P&A segment's net sales change were as follows: Percent change in net sales compared to the prior year 2024 Volume (3.9) % Product Mix and Price 0.9 % Currency (0.3) % (3.3) % International sales were 30 percent of the Engine P&A segment's net sales in 2024.
We evaluate potential acquisitions, divestitures and joint ventures in the ordinary course of business. 2023 Cash Flow Net cash provided by operating activities of continuing operations in 2023 totaled $745.2 million versus $580.4 million in 2022. The increase is primarily due to a decrease in working capital usage, partially offset by lower net earnings.
We evaluate potential acquisitions, divestitures and joint ventures in the ordinary course of business. 2024 Cash Flow Net cash provided by operating activities of continuing operations in 2024 totaled $449.5 million versus $745.2 million in 2023. The decrease is primarily due to lower net earnings.
Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments.
Working capital is defined as Accounts and notes receivable, Inventories and Prepaid expenses and other, net of Accounts payable and Accrued expenses as presented in the Consolidated Balance Sheets, excluding the impact of acquisitions and non-cash adjustments. Net inventory decreased $112.8 million primarily due to lower planned production.
The key uncertainties in these calculations are the assumptions used in determining the reporting unit’s forecasted future performance, including revenue growth and operating margins, as well as the perceived risk associated with those forecasts in determining the Discount Rate, along with selecting representative market multiples. We did not record any goodwill impairments in 2023, 2022 or 2021. Other Intangible Assets.
The key uncertainties in these calculations are the assumptions used in determining the reporting unit’s forecasted future performance, including revenue growth and operating margins, as well as the perceived risk associated with those forecasts in determining the Discount Rate, along with selecting representative market multiples.
The components of the Navico Group segment's net sales change were as follows: Percent change in net sales compared to the prior year 2023 Volume (14.4) % IT Security Incident (1.2) % Product Mix and Price 1.1 % (14.5) % International sales were 37 percent of the Navico Group segment's net sales in 2023.
The components of the Navico Group segment's net sales change were as follows: Percent change in net sales compared to the prior year 2024 Volume (12.4) % Product Mix and Price (0.2) % Currency 0.1 % (12.5) % International sales were 41 percent of the Navico Group segment's net sales in 2024.
Liquidity and Capital Resources We view our highly liquid assets as of December 31, 2023 and 2022 as: (in millions) 2023 2022 Cash and cash equivalents $ 467.8 $ 595.6 Short-term investments in marketable securities 0.8 4.5 Total cash, cash equivalents and marketable securities $ 468.6 $ 600.1 The following table sets forth an analysis of Total liquidity as of December 31, 2023 and 2022: (in millions) 2023 2022 Cash, cash equivalents and marketable securities $ 468.6 $ 600.1 Amounts available under lending facilities (A) 741.9 747.2 Total liquidity (B) $ 1,210.5 $ 1,347.3 (A) See Note 14 – Debt in the Notes to Consolidated Financial Statements for further details on our lending facilities.
Refer to Note 14 – Debt in the Notes to Consolidated Financial Statements for further details on our debt activity during the year ended December 31, 2024. 37 Table of Contents Liquidity and Capital Resources We view our highly liquid assets as of December 31, 2024 and 2023 as: (in millions) 2024 2023 Cash and cash equivalents, at cost, which approximates fair value $ 269.0 $ 467.8 Short-term investments in marketable securities 0.8 0.8 Total cash, cash equivalents and marketable securities $ 269.8 $ 468.6 The following table sets forth an analysis of Total liquidity as of December 31, 2024 and 2023: (in millions) 2024 2023 Cash, cash equivalents and marketable securities $ 269.8 $ 468.6 Amounts available under lending facilities (A) 997.0 741.9 Total liquidity (B) $ 1,266.8 $ 1,210.5 (A) See Note 14 – Debt in the Notes to Consolidated Financial Statements for further details on our lending facilities.
Fair value under the guideline public company method is determined for each reporting unit by applying market multiples for comparable public companies to the unit’s current and forecasted financial results. We exercise judgment when determining the comparable public companies and market multiples.
If actual results differ from the forecast, our results of operations could be materially adversely affected. Fair value under the guideline public company method is determined for each reporting unit by applying market multiples for comparable public companies to the unit’s current and forecasted financial results. We exercise judgment when determining the comparable public companies and market multiples.
For example, the discussion of our cash flows includes an analysis of free cash flows and total liquidity; the discussion of our net sales includes net sales on a constant currency basis; the discussion of our net sales includes net sales excluding acquisitions; and the discussion of our earnings includes a presentation of operating earnings and operating margin excluding restructuring, exit and impairment charges, purchase accounting amortization, acquisition, integration and IT-related costs, IT security incident costs, Sport Yacht & Yachts, reclassification of held-for-sale items, gain on sale of assets, TN-BC Holdings LLC joint venture impairment, loss on early extinguishment of debt, special tax items, and other applicable charges and of diluted earnings per common share, as adjusted.
For example, the discussion of our cash flows includes an analysis of free cash flows and total liquidity; the discussion of our net sales includes net sales on a constant currency basis; the discussion of our net sales includes net sales excluding acquisitions; and the discussion of our earnings includes a presentation of operating earnings and operating margin excluding restructuring, exit and impairment charges, purchase accounting amortization, acquisition, integration, and IT related costs, IT security incident costs and other applicable charges and of diluted earnings per common share, as adjusted.
See Note 10 – Income Taxes in Notes to Consolidated Financial Statements for further details. 46 Tab l e of Content s Recent Accounting Pronouncements See Note 1 – Significant Accounting Policies in the Notes to Consolidated Financial Statements for the recent accounting pronouncements that have been adopted during the year ended December 31, 2023, or will be adopted in future periods.
Recent Accounting Pronouncements See Note 1 – Significant Accounting Policies in the Notes to Consolidated Financial Statements for the recent accounting pronouncements that have been adopted during the year ended December 31, 2024, or will be adopted in future periods.
The components of the Propulsion segment's net sales change were as follows: Percent change in net sales compared to the prior year 2023 Volume (14.1) % Product Mix and Price 13.4 % IT Security Incident (1.6) % Acquisitions 0.4 % Currency (0.2) % (2.1) % International sal es w ere 32 percent of the Propulsion segment's net sales in 2023.
The components of the Propulsion segment's net sales change were as follows: Percent change in net sales compared to the prior year 2024 Volume (29.4) % Product Mix and Price 3.6 % Acquisitions 1.2 % Currency (0.4) % (25.0) % International sales were 36 percent of the Propulsion segment's net sales in 2024.
Matters Affecting Comparability Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales.
Refer to Note 4 – Acquisitions in the Notes to the Consolidated Financial Statements for further information. Matters Affecting Comparability Changes in Foreign Currency Rates. Percentage changes in net sales expressed in constant currency reflect the impact that changes in currency exchange rates had on comparisons of net sales.
These covenants also pertain to termination provisions included in our wholesale financing joint-venture arrangements with Wells Fargo Commercial Distribution Finance. Based on our anticipated earnings generation throughout the year, we expect to maintain sufficient cushion against the existing debt covenants. As of December 31, 2023, we were in compliance with the financial covenants in the Credit Facility and CP Program.
Based on our anticipated earnings generation throughout the year, we expect to maintain sufficient cushion against the existing debt covenants. As of December 31, 2024, we were in compliance with the financial covenants in the Credit Facility and CP Program.
Intangible assets that are subject to amortization are evaluated for impairment using a process similar to that used to evaluate long-lived assets described below. Intangible assets not subject to amortization are assessed for impairment at least annually and whenever events or changes in circumstances indicate that it is more likely than not that an asset may be impaired.
Intangible assets not subject to amortization are assessed for impairment at least annually and whenever events or changes in circumstances indicate that it is more likely than not that an asset may be impaired. The impairment test for indefinite-lived intangible assets consists of a comparison of the fair value of the intangible asset with its carrying amount.
Refer to Note 1 – Significant Accounting Policies in the Notes to Consolidated Financial Statements for further information. We recognized $7.6 million and $(6.1) million in 2023 and 2022, respectively, in Other income (expense), net. Other income (expense), net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other postretirement benefit costs.
Refer to Note 1 – Significant Accounting Policies in the Notes to Consolidated Financial Statements for further information. We recognized $9.0 million and $7.6 million in 2024 and 2023, respectively, in Other income (expense), net.
If the carrying value of the reporting unit exceeds its fair value, a goodwill impairment is recorded equal to the carrying value of the reporting unit less its fair value, not to exceed the carrying value of goodwill. We calculate the fair value of our reporting units considering both the income approach and the guideline public company method.
If the carrying value of the reporting unit exceeds its fair value, a goodwill impairment is recorded equal to the carrying value of the reporting unit less its fair value, not to exceed the carrying value of goodwill.
The key uncertainties in the RFR and MPEEM calculations, as applicable, are: the selection of an appropriate royalty rate, assumptions used in developing internal revenue growth and expense forecasts, assumed customer attrition rates, as well as the perceived risk associated with those forecasts in determining the Discount Rate and risk premium. 45 Tab l e of Content s The costs of amortizable intangible assets are recognized over their expected useful lives, typically between three and fifteen years, using the straight-line method.
The key uncertainties in the RFR and MPEEM calculations, as applicable, are: the selection of an appropriate royalty rate, assumptions used in developing internal revenue growth and expense forecasts, assumed customer attrition rates, as well as the perceived risk associated with those forecasts in determining the Discount Rate and risk premium.
Diluted earnings per common share from continuing operations benefited from common stock repurchases in both years. Segments We have four reportable segments: Propulsion, Engine P&A, Navico Group, and Boat.
Diluted earnings per common share from continuing operations benefited from common stock repurchases in both years. 32 Table of Contents Segments We have four reportable segments: Propulsion, Engine P&A, Navico Group, and Boat. Refer to Note 5 – Segment Information in the Notes to Consolidated Financial Statements for details on the segment operations.
Available borrowing capacity under the Credit Facility as of December 31, 2023 totaled $741.9 million, net of $8.1 million of letters of credit outstanding.
There were no borrowings under the Credit Facility during 2023. Available borrowing capacity under the Credit Facility as of December 31, 2023 totaled $741.9 million, net of $8.1 million of letters of credit outstanding. During 2023, the maximum amount utilized under our CP Program was $125.0 million.
The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for 2023, 2022 and 2021: Operating Earnings Diluted Earnings (Loss) Per Share (in millions, except per share data) 2023 2022 2021 2023 2022 2021 GAAP $ 734.9 $ 947.8 $ 812.9 $ 6.13 $ 9.06 $ 7.59 Restructuring, exit and impairment charges 54.7 25.1 0.8 0.61 0.25 0.01 Purchase accounting amortization 57.5 65.0 45.7 0.64 0.65 0.46 Acquisition, integration, and IT related costs 12.1 10.8 24.3 0.14 0.11 0.27 IT security incident costs 10.1 — — 0.12 — — Sport Yacht & Yachts — — 3.8 — — 0.04 Palm Coast reclassified from held-for-sale — — 0.8 — — 0.01 Gain on sale of assets — — (1.5) — — (0.01) TN-BC Holdings LLC joint venture impairment — — — 0.21 — — Loss on early extinguishment of debt — — — — — 0.04 Special tax items — — — 0.95 (0.04) (0.13) As Adjusted $ 869.3 $ 1,048.7 $ 886.8 $ 8.80 $ 10.03 $ 8.28 GAAP operating margin 11.5 % 13.9 % 13.9 % Adjusted operating margin 13.6 % 15.4 % 15.2 % 33 Tab l e of Content s 2023 vs. 2022 Net sales decreased 6.0 percent during 2023 when compared with 2022.
The following is a reconciliation of our non-GAAP measures, adjusted operating earnings and adjusted diluted earnings per common share from continuing operations for 2024 and 2023: Operating Earnings Diluted Earnings Per Share (in millions, except per share data) 2024 2023 2024 2023 GAAP $ 311.6 $ 734.9 $ 2.21 $ 6.13 Restructuring, exit and impairment charges 121.7 54.7 1.41 0.61 Purchase accounting amortization 58.5 57.5 0.68 0.64 Acquisition, integration, and IT related costs 3.6 12.1 0.04 0.14 IT security incident costs — 10.1 — 0.12 Special tax items (A) — — 0.19 0.95 Loss on early extinguishment of debt — — 0.15 — Release of dissolved entity foreign currency translation — — 0.01 — TN-BC Holdings LLC joint venture impairment — — — 0.21 Gain on sale of business — — (0.12) — As Adjusted $ 495.4 $ 869.3 $ 4.57 $ 8.80 GAAP operating margin 5.9 % 11.5 % Adjusted operating margin 9.5 % 13.6 % (A) Special tax items during the year ended December 31, 2024 primarily relate to the discrete income tax expense recorded associated with an increase in the state valuation allowance. 31 Table of Contents 2024 vs. 2023 Net sales decreased 18.2 percent during 2024 when compared with 2023.
Net interest expense increased in 2023 compared with 2022 due to an increase in average daily debt outstanding, which was influenced by debt issuances. Refer to Note 14 – Debt in the Notes to Consolidated Financial Statements. We recognized an income tax provision of $196.3 million and $172.3 million in 2023 and 2022, respectively.
Net interest expense increased in 2024 compared with 2023 due to an increase in average daily debt outstanding, which was influenced by the timing of debt issuances. We also recognized a loss on early extinguishment of debt related to the redemption of our 2027 Notes. Refer to Note 14 – Debt in the Notes to Consolidated Financial Statements.
We exercise judgment when determining the level of risk associated with achieving the forecasted future cash flows. These estimates are subject to uncertainty as actual results may differ from our forecast. If actual results differ from the forecast, our results of operations could be materially adversely affected.
We exercise judgment when forecasting future cash flows including the performance of the underlying market in which the reporting unit operates as well as the impact of specific initiatives. We exercise judgment when determining the level of risk associated with achieving the forecasted future cash flows. These estimates are subject to uncertainty as actual results may differ from our forecast.
Our primary other intangible assets are customer relationships, trade names, and developed technology acquired in business combinations. Intangible assets are initially valued using a methodology commensurate with the intended use of the asset. Customer relationships, trade names, and developed technology are valued using the income approach.
Intangible assets are initially valued using a methodology commensurate with the intended use of the asset. Customer relationships, trade names, and developed technology are valued using the income approach. The fair value of customer relationships is measured using the multi-period excess earnings method (MPEEM).
The Discount Rate is developed using market observable inputs, as well as considering whether or not there is a measure of risk related to the specific reporting unit’s forecasted performance. We exercise judgment when forecasting future cash flows including the performance of the underlying market in which the reporting unit operates as well as the impact of specific initiatives.
Internally forecasted future cash flows, which we believe reasonably approximates market participant assumptions, are discounted using a weighted average cost of capital (Discount Rate) developed for each reporting unit. The Discount Rate is developed using market observable inputs, as well as considering whether or not there is a measure of risk related to the specific reporting unit’s forecasted performance.
Engine P&A Segment The following table sets forth the Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 $ % $ % Net sales $ 1,199.8 $ 1,310.2 $ 1,371.7 $ (110.4) (8.4) % $ (61.5) (4.5) % GAAP operating earnings $ 217.4 $ 268.0 $ 282.4 $ (50.6) (18.9) % $ (14.4) (5.1) % Restructuring, exit and impairment charges 3.3 — — 3.3 NM — NM Acquisition, integration, and IT related costs 0.6 — — 0.6 NM — NM IT security incident costs 0.5 — — 0.5 NM — NM Adjusted operating earnings $ 221.8 $ 268.0 $ 282.4 $ (46.2) (17.2) % $ (14.4) (5.1) % GAAP operating margin 18.1 % 20.5 % 20.6 % (240) bps (10) bps Adjusted operating margin 18.5 % 20.5 % 20.6 % (200) bps (10) bps NM = not meaningful bps = basis points 2023 vs. 2022 Engine P&A segment's net sales decreased $110.4 million or 8.4 percent in 2023 versus the prior year due to lower sales in both of the Products and Distribution businesses.
Propulsion segment's operating earnings decreased versus the prior year, primarily due to the impact of lower sales and lower absorption from declines in production, partially offset by cost control measures. 33 Table of Contents Engine P&A Segment The following table sets forth Engine P&A segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2024 and 2023: 2024 vs. 2023 (in millions) 2024 2023 $ % Net sales $ 1,160.8 $ 1,199.8 $ (39.0) (3.3) % GAAP operating earnings $ 219.9 $ 217.4 $ 2.5 1.1 % Restructuring, exit and impairment charges 4.8 3.3 1.5 45.5 % Acquisition, integration, and IT related costs — 0.6 (0.6) NM IT security incident costs — 0.5 (0.5) NM Adjusted operating earnings $ 224.7 $ 221.8 $ 2.9 1.3 % GAAP operating margin 18.9 % 18.1 % 80 bps Adjusted operating margin 19.4 % 18.5 % 90 bps NM = not meaningful bps = basis points 2024 vs. 2023 Engine P&A segment's net sales decreased in 2024 versus the prior year as a result of softer market conditions.
Contractual Obligations The following table sets forth a summary of our contractual cash obligations as of December 31, 2023: Payments due by period (in millions) Total Less than 1 year 1-3 years 3-5 years More than 5 years Contractual Obligations Debt (A) $ 2,462.9 $ 455.4 $ 4.4 $ 163.1 $ 1,840.0 Interest payments on long-term debt 1,650.3 98.5 189.4 177.1 1,185.3 Operating leases (B) 223.1 37.2 51.2 37.0 97.7 Purchase obligations (C) 76.4 76.2 0.2 — — Deferred management compensation (D) 27.3 5.0 6.0 6.0 10.3 Other long-term liabilities (E) 146.8 5.8 66.3 47.5 27.2 Total contractual obligations $ 4,586.8 $ 678.1 $ 317.5 $ 430.7 $ 3,160.5 (A) See Note 14 – Debt in the Notes to Consolidated Financial Statements for additional information on our debt.
Contractual Obligations The following table sets forth a summary of our contractual cash obligations as of December 31, 2024: Payments due by period (in millions) Total Less than 1 year 1-3 years 3-5 years More than 5 years Contractual Obligations Debt (A) $ 2,374.0 $ 246.4 $ 8.5 $ 404.1 $ 1,715.0 Interest payments on long-term debt 1,418.9 86.7 297.3 244.1 790.8 Operating leases (B) 232.4 35.5 57.6 41.0 98.3 Purchase obligations (C) 103.3 102.4 0.6 0.3 — Deferred management compensation (D) 31.8 5.0 6.0 6.0 14.8 Other long-term liabilities (E) 159.8 3.8 80.3 54.5 21.2 Total contractual obligations $ 4,320.2 $ 479.8 $ 450.3 $ 750.0 $ 2,640.1 (A) See Note 14 – Debt in the Notes to Consolidated Financial Statements for additional information on our debt.
For further information, refer to Note 5 – Segment Information in the Notes to the Consolidated Financial Statements. Acquisitions During the fourth quarter of 2023, we acquired additional Freedom Boat Club franchise operations and territory rights as well as certain marine assets in the Southeast United States for net cash consideration of $16.0 million.
During the fourth quarter of 2023, we acquired additional Freedom Boat Club franchise operations and territory rights as well as certain marine assets in the Southeast United States for net cash consideration of $16.0 million. On September 1, 2023, the Company acquired all of the issued and outstanding shares of Fliteboard Pty Ltd for $88.3 million net cash consideration.
The components of the consolidated net sales change were as follows: Percent change in net sales compared to the prior year 2023 Volume (13.2) % Product Mix and Price 8.1 % IT Security Incident (1.2) % Acquisitions 0.4 % Currency (0.1) % (6.0) % Sales in 2023 were below the prior year as higher discounts in select segments coupled with the impact of cautious wholesale ordering patterns by dealers, OEMs and retailers in the second half of the year were partially offset by successful new product momentum, positive mix and pricing.
The components of the consolidated net sales change were as follows: Percent change in net sales compared to the prior year 2024 Volume (21.9) % Product Mix and Price 3.2 % Acquisitions 0.7 % Currency (0.2) % (18.2) % Sales in 2024 were below the prior year as the impact of lower wholesale ordering patterns by dealers, OEMs and retailers, coupled with higher discounts in select segments, and unfavorable changes in foreign currency exchange rates, were only partially offset by annual price increases and well received new products.
We exercise judgment when evaluating the impact of market and industry changes and when comparing actual results to projected results. 44 Tab l e of Content s If the fair value of a reporting unit does not meet the "more likely than not" criteria discussed above, we perform a quantitative assessment which begins by measuring the fair value of the reporting unit.
If the fair value of a reporting unit does not meet the "more likely than not" criteria discussed above, we perform a quantitative assessment which begins by measuring the fair value of the reporting unit.
The Company did not record any impairment charges during the year ended December 31, 2021. Refer to Note 4 – Acquisitions and Note 9 – Goodwill and Other Intangibles in the Notes to Consolidated Financial Statements for more information. Long-Lived Assets.
Refer to Note 4 – Acquisitions and Note 9 – Goodwill and Other Intangibles in the Notes to Consolidated Financial Statements for more information.
Corporate/Other The following table sets forth Corporate/Other results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 $ % $ % GAAP operating loss $ (138.0) $ (124.1) $ (114.9) $ (13.9) 11.2 % $ (9.2) 8.0 % Restructuring, exit and impairment charges 7.7 17.4 — (9.7) (55.7) % 17.4 NM IT security incident costs 4.7 — — 4.7 NM — NM Acquisition, integration, and IT related costs 1.7 0.5 0.2 1.2 NM 0.3 NM Adjusted operating loss $ (123.9) $ (106.2) $ (114.7) $ (17.7) 16.7 % $ 8.5 (7.4) % NM = not meaningful 40 Tab l e of Content s Corporate operating expenses increased by $13.9 million in 2023 compared with 2022 due to spending on enterprise growth initiatives, the IT security incident and unfavorable mark-to-market adjustments for deferred compensation arrangements.
Corporate/Other The following table sets forth Corporate/Other results and a reconciliation to our non-GAAP measure of adjusted operating loss for the years ended December 31, 2024 and 2023: 2024 vs. 2023 (in millions) 2024 2023 $ % GAAP operating loss $ (113.6) $ (138.0) $ 24.4 (17.7) % Restructuring, exit and impairment charges 2.4 7.7 (5.3) (68.8) % IT security incident costs — 4.7 (4.7) NM Acquisition, integration, and IT related costs — 1.7 (1.7) NM Adjusted operating loss $ (111.2) $ (123.9) $ 12.7 (10.3) % NM = not meaningful 36 Table of Contents Corporate operating loss decreased compared with 2023 driven by lower variable compensation costs along with the impact of both the IT security incident and restructuring charges in the prior year.
Refer to Note 5 – Segment Information in the Notes to Consolidated Financial Statements for details on the segment operations. 35 Tab l e of Content s Propulsion Segment The following table sets forth the Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 $ % $ % Net sales $ 2,763.8 $ 2,824.0 $ 2,504.7 $ (60.2) (2.1) % $ 319.3 12.7 % GAAP operating earnings $ 494.7 $ 522.9 $ 449.7 (28.2) (5.4) % 73.2 16.3 % Restructuring, exit and impairment charges 2.7 — — 2.7 NM — NM IT security incident costs 3.4 — — 3.4 NM — NM Acquisition, integration, and IT related costs 2.5 — — 2.5 NM — NM Purchase accounting amortization 0.9 — — 0.9 NM — NM Adjusted operating earnings $ 504.2 $ 522.9 $ 449.7 (18.7) (3.6) % 73.2 16.3 % GAAP operating margin 17.9 % 18.5 % 18.0 % (60) bps 50 bps Adjusted operating margin 18.2 % 18.5 % 18.0 % (30) bps 50 bps NM = not meaningful bps = basis points 2023 vs. 2022 Propulsion segment's net sales decreased $60.2 million or 2.1 percent in 2023 versus prior year due to cautious OEM ordering patterns in the second half of the year, partially offset by continued market share gains in outboard engines, positive mix and pricing as well as the acquisition of Fliteboard.
Propulsion Segment The following table sets forth Propulsion segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2024 and 2023: 2024 vs. 2023 (in millions) 2024 2023 $ % Net sales $ 2,074.2 $ 2,763.8 $ (689.6) (25.0) % GAAP operating earnings $ 242.6 $ 494.7 $ (252.1) (51.0) % Restructuring, exit and impairment charges 9.6 2.7 6.9 NM IT security incident costs — 3.4 (3.4) NM Acquisition, integration, and IT related costs 1.5 2.5 (1.0) (40.0) % Purchase accounting amortization 1.5 0.9 0.6 66.7 % Adjusted operating earnings $ 255.2 $ 504.2 $ (249.0) (49.4) % GAAP operating margin 11.7 % 17.9 % (620) bps Adjusted operating margin 12.3 % 18.2 % (590) bps NM = not meaningful bps = basis points 2024 vs. 2023 Propulsion segment's net sales decreased in 2024 versus prior year due to softer market conditions resulting in lower OEM production rates and engine orders and unfavorable changes in foreign currency exchange rates, partially offset by the impact of annual pricing and market share gains in outboard engines.
The decrease is primarily due to increased working capital, partially offset by higher net earnings. The primary drivers of Net cash provided by operating activities of continuing operations in 2022 were net earnings, net of non-cash items, partially offset by increases in working capital. Accounts and notes receivable increased $74.6 million primarily due to increased sales.
The primary drivers of Net cash provided by operating activities of continuing operations in 2024 were net earnings, net of non-cash items, partially offset by working capital.
The components of the Boat segment's net sales change were as follows: Percent change in net sales compared to the prior year 2022 Volume 12.6 % Product Mix and Price 10.5 % Acquisitions 3.0 % Currency (1.7) % 24.4 % International s ales were 24 percent of the Boat segment's net sales in 2022, and increased 13 percent on a GAAP basis and 19 percent on a constant currency basis.
Percent change in net sales compared to the prior year 2024 Volume (21.6) % Product Mix and Price (0.9) % Acquisitions 0.6 % Currency — % (21.9) % International sales were 20 percent of the Boat segment's net sales in 2024. International sales decreased 31 percent year-over-year on a GAAP basis and 30 percent on a constant currency basis.
During 2023, we recorded restructuring, exit and impairment charges of $54.7 million compared with $25.1 million in 2022. The Company estimates the restructuring actions executed in 2023 will result in approximately $45 million of annualized cost savings. The future cost savings related to restructuring actions executed in 2022 are not expected to be material to our Consolidated Financial Statements.
Research and development expense decreased during 2024 versus 2023. During 2024, we recorded restructuring, exit and impairment charges of $121.7 million compared with $54.7 million in 2023. The Company estimates the restructuring actions executed in 2024 will result in approximately $24.0 million of annualized cost savings.
During the second quarter of 2022, we acquired certain Freedom Boat Club franchise operations and territory rights as well as certain marine assets in the Southeast United States for net cash consideration of $93.9 million. Refer to Note 4 – Acquisitions in the Notes to the Consolidated Financial Statements for further information.
For further information, refer to Note 5 – Segment Information in the Notes to the Consolidated Financial Statements. Acquisitions On September 12, 2024, we acquired additional Freedom Boat Club franchise operations and territories in Southeast Florida for net cash consideration of $31.2 million. Refer to Note 4 – Acquisitions in the Notes to the Consolidated Financial Statements for further information.
Gross margin percentage decreased 70 basis points in 2023 when compared with 2022 driven by higher manufacturing costs including material and labor inflation (260 bps), depreciation (60 bps), absorption (35 bps), the IT security incident (30 bps), and unfavorable foreign currency exchange-rate fluctuations (25 bps), offset by sales-related drivers (330 bps) and acquisitions (10 bps).
Gross margin decreased 210 basis points in 2024 when compared with 2023 driven by lower absorption from decreased production levels (90 bps), material and labor inflation (60 bps), sales-related drivers (60 bps), and foreign currency exchange-rate fluctuations (20 bps), partially offset by acquisitions (20 bps).
Net cash used for investing activities of continuing operations was $443.2 million, which included $388.3 million of capital expenditures, $93.8 million of cash paid for acquisitions, net of cash acquired, and $60.1 million of purchases of marketable securities, partially offset by $56.4 million of sales or maturities of marketable securities and $42.5 million of cross-currency swap settlements.
Net cash used for investing activities was $168.9 million, which included $167.4 million of capital expenditures, $80.9 million of purchases of marketable securities and $31.8 million of cash paid for acquisitions, net of cash acquired, partially offset by $82.1 million of sales or maturities of marketable securities and $15.0 million of proceeds from sales of property, plant and equipment.
Boat Segment The following table sets forth the Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 $ % $ % Net sales $ 1,989.4 $ 2,119.4 $ 1,703.1 $ (130.0) (6.1) % $ 416.3 24.4 % GAAP operating earnings $ 155.6 $ 212.8 $ 142.3 $ (57.2) (26.9) % $ 70.5 49.5 % Restructuring, exit and impairment charges 10.5 — 0.1 10.5 NM (0.1) NM Acquisition, integration, and IT related costs 5.2 0.6 6.3 4.6 NM (5.7) (90.5) % Purchase accounting amortization 3.6 3.1 1.6 0.5 16.1 % 1.5 93.8 % IT security incident costs 1.0 — — 1.0 NM — NM Sport Yacht & Yachts — — 3.8 — NM (3.8) NM Palm Coast reclassified from held-for-sale — — 0.8 — NM (0.8) NM Adjusted operating earnings $ 175.9 $ 216.5 $ 154.9 $ (40.6) (18.8) % $ 61.6 39.8 % GAAP operating margin 7.8 % 10.0 % 8.4 % (220) bps 160 bps Adjusted operating margin 8.8 % 10.2 % 9.1 % (140) bps 110 bps NM = not meaningful bps = basis points 39 Tab l e of Content s 2023 vs. 2022 Boat segment's net sale s decreased $130.0 million or 6.1 percent versus 2022 due to decreased sales volumes to dealers, partially offset by favorable product mix and pricing.
Navico Group segment's operating earnings decreased versus the prior year due to intangible asset impairment charges and the impact from lower sales, partially offset by cost control measures. 35 Table of Contents Boat Segment The following table sets forth Boat segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2024 and 2023: 2024 vs. 2023 (in millions) 2024 2023 $ % Net sales $ 1,553.5 $ 1,989.4 $ (435.9) (21.9) % GAAP operating earnings $ 63.3 $ 155.6 $ (92.3) (59.3) % Restructuring, exit and impairment charges 6.3 10.5 (4.2) (40.0) % Acquisition, integration, and IT related costs 0.4 5.2 (4.8) (92.3) % Purchase accounting amortization 4.0 3.6 0.4 11.1 % IT security incident costs — 1.0 (1.0) NM Adjusted operating earnings $ 74.0 $ 175.9 $ (101.9) (57.9) % GAAP operating margin 4.1 % 7.8 % (370) bps Adjusted operating margin 4.8 % 8.8 % (400) bps NM = not meaningful bps = basis points 2024 vs. 2023 Boat segment's net sale s decreased in 2024 versus the prior year resulting from lower wholesale orders, as dealers continue to manage pipeline levels, along with higher levels of selective discounting, partially offset by the favorable impact of modest model-year pricing.
Available borrowing capacity under the Credit Facility as of December 31, 2022 totaled $747.2 million, net of $2.8 million of letters of credit outstanding. During 2022, the maximum amount utilized under our CP Program was $300.0 million. The level of borrowing capacity under our Credit Facility and CP Program is limited by both a leverage and interest coverage test.
Available borrowing capacity under the Credit Facility as of December 31, 2024 totaled $997.0 million, net of $3.0 million of letters of credit outstanding. During 2024, the maximum amount utilized under our unsecured commercial paper program (CP Program) was $280.0 million and as of December 31, 2024, the Company had $115.0 million of borrowings outstanding under the CP Program.
The effective tax rate, which is calculated as the income tax provision as a percentage of earnings before income taxes, was 31.2 percent and 20.2 percent for 2023 and 2022, respectively. See Note 10 – Income Taxes in the Notes to Consolidated Financial Statements for a reconciliation of our effective tax rate and statutory Federal income tax rate.
The effective tax rate, which is calculated as the income tax provision as a percentage of earnings before income taxes, was 26.6 percent and 31.2 percent for 2024 and 2023, respectively. We have also evaluated the effects of Pillar Two legislation and concluded that the tax effects are not material to the financial statements.
Navico Group Segment The following table sets forth the Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2023, 2022 and 2021: 2023 vs. 2022 2022 vs. 2021 (in millions) 2023 2022 2021 $ % $ % Net sales $ 914.7 $ 1,069.3 $ 688.3 $ (154.6) (14.5) % $ 381.0 55.4 % GAAP operating earnings $ 5.2 $ 68.2 $ 53.4 $ (63.0) (92.4) % $ 14.8 27.7 % Restructuring, exit and impairment charges 30.5 7.7 0.7 22.8 NM 7.0 NM Purchase accounting amortization 53.0 61.9 44.1 (8.9) (14.4) % 17.8 40.4 % Acquisition, integration, and IT related costs 2.1 9.7 17.8 (7.6) (78.4) % (8.1) (45.5) % IT security incident costs 0.5 — — 0.5 NM — NM Gain on sale of assets — — (1.5) — NM 1.5 NM Adjusted operating earnings $ 91.3 $ 147.5 $ 114.5 $ (56.2) (38.1) % $ 33.0 28.8 % GAAP operating margin 0.6 % 6.4 % 7.8 % (580) bps (140) bps Adjusted operating margin 10.0 % 13.8 % 16.6 % (380) bps (280) bps NM = not meaningful bps = basis points 2023 vs. 2022 Navico Group segment's net sales decreased by $154.6 million or 14.5 percent in 2023 versus the prior year due to lower sales resulting from softer marine OEM orders and the continued weak RV manufacturing environment.
Engine P&A segment's operating earnings increased versus the prior year, as the impact of the operational efficiencies resulting from the completed transition to the Brownsburg, Indiana distribution center, annual pricing, and lower operating expenses more than offset lower volumes and higher material inflation. 34 Table of Contents Navico Group Segment The following table sets forth Navico Group segment results and a reconciliation to our non-GAAP measure of adjusted operating earnings for the years ended December 31, 2024 and 2023: 2024 vs. 2023 (in millions) 2024 2023 $ % Net sales $ 800.2 $ 914.7 $ (114.5) (12.5) % GAAP operating (loss) earnings $ (100.6) $ 5.2 $ (105.8) NM Restructuring, exit and impairment charges 98.6 30.5 68.1 NM Purchase accounting amortization 53.0 53.0 — NM Acquisition, integration, and IT related costs 1.7 2.1 (0.4) (19.0) % IT security incident costs — 0.5 (0.5) NM Adjusted operating earnings $ 52.7 $ 91.3 $ (38.6) (42.3) % GAAP operating margin (12.6) % 0.6 % NM Adjusted operating margin 6.6 % 10.0 % (340) bps NM = not meaningful bps = basis points 2024 vs. 2023 Navico Group segment's net sales decreased in 2024 versus the prior year due to reduced sales to marine OEMs resulting from lower boat production levels to match retail ordering patterns and a weak RV manufacturing environment, partially offset by strong new product momentum.
We believe that we have adequate sources of liquidity to meet our short-term and long-term needs. 2024 Capital Strategy We anticipate executing a balanced capital strategy in 2024, leveraging our strong cash position and liquidity. We anticipate being active with share repurchases with spend in excess of $200 million in 2024.
We believe that we have adequate sources of liquidity to meet our short-term and long-term needs. 2025 Capital Strategy We anticipate executing a thoughtful capital strategy in 2025 with planned debt reductions of $125 million, capital expenditures at levels similar to 2024 of $160 million, and a minimum of $80 million of share repurchases, which could increase in the event cash generation outpaces initial expectations.
Selling, general and administrative expenses as a percentage of net sales increased 140 basis points during 2023 when compared with the same prior year period, due to lower sales (70 bps), increased relative spending on technology initiatives and the IT security incident (20 bps), sales and marketing (20 bps), operating expenses associated with current year acquisitions (20 bps) and amortization (10 bps).
Selling, general and administrative expenses as a percentage of net sales increased 160 basis points during 2024 when compared with the same prior year period, due to lower sales (280 bps), partially offset by cost control measures across the enterprise, including lower employee compensation costs associated with headcount reductions and lower variable compensation (120 bps).
Our capital spending was focused on investments in capacity expansion, new products and technology. Net cash provided by financing activities was $110.8 million and primarily related to proceeds of issuances of long-term debt, partially offset by common stock repurchases, payments of long-term debt including current maturities, and cash dividends paid to common shareholders.
Net cash used for financing activities was $442.7 million, which included $613.2 million of payments of long-term debt including current maturities, $200.0 million of common stock repurchases, $112.3 million of cash dividends paid to common shareholders, and $87.4 million of payments of short-term debt, partially offset by $396.9 million of proceeds from issuances of long-term debt and $201.1 million of proceeds from issuances of short-term debt.
IT Security Incident As previously announced on June 13, 2023, the Company experienced an IT security incident that impacted some of its systems and global facilities.
"Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2023 Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 16, 2024. 29 Table of Contents IT Security Incident In June 2023, the Company experienced an IT security incident that impacted some of its systems and global facilities.
The income approach calculates the fair value of the reporting unit using a discounted cash flow approach utilizing a Gordon Growth model. Internally forecasted future cash flows, which we believe reasonably approximates market participant assumptions, are discounted using a weighted average cost of capital (Discount Rate) developed for each reporting unit.
We calculate the fair value of our reporting units considering both the income approach and the guideline public company method, a form of the market approach. The income approach calculates the fair value of the reporting unit using a discounted cash flow approach utilizing a Gordon Growth model.
The primary drivers of Net cash provided by operating activities of continuing operations in 2023 were net earnings, net of non-cash items, partially offset by working capital usage. Accounts and notes receivable decreased $54.5 million primarily due to lower sales and timing of collections. Accounts payable decreased $86.1 million, primarily due to lower purchasing resulting from reduced production.
Accounts and notes receivable decreased $45.0 million primarily due to lower sales and timing of collections. Accounts payable decreased $144.2 million, primarily due to lower purchasing resulting from reduced production. Accrued expenses decreased $104.0 million, primarily driven by a reduction in accrued variable compensation.
The impairment test for indefinite-lived intangible assets consists of a comparison of the fair value of the intangible asset with its carrying amount. An impairment loss is recognized for the amount by which the carrying value exceeds the fair value of the asset.
An impairment loss is recognized for the amount by which the carrying value exceeds the fair value of the asset. The Company recorded impairment charges of $5.0 million during the year ended December 31, 2024 related to the Navico trade name.
Other income (expense), net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other postretirement benefit costs. Net interest expense increased in 2022 compared with 2021 due to an increase in average daily debt outstanding, which was influenced by debt issuances. Refer to Note 14 – Debt in the Notes to Consolidated Financial Statements.
Other income (expense), net primarily includes remeasurement gains and losses resulting from changes in foreign currency rates and other postretirement benefit costs as well as the gain on sale of one of our businesses in 2024.
Removed
On September 1, 2023, the Company acquired all of the issued and outstanding shares of Fliteboard Pty Ltd for $87.6 million net cash consideration. Refer to Note 4 – Acquisitions in the Notes to the Consolidated Financial Statements for further information.
Added
For a discussion of Brunswick's consolidated results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022, refer to Part II, Item 7.
Removed
On October 4, 2021, we completed the acquisition of Navico for $1.094 billion net cash consideration. Navico was a privately held global company based in Egersund, Norway, and is a global leader in marine electronics and sensors, including multi-function displays, fish finders, autopilots, sonar, radar, and cartography.
Added
We recognized an income tax provision of $54.0 million and $196.3 million in 2024 and 2023, respectively. The decrease is primarily due to lower pretax income and the prior year intercompany sale of certain intellectual property rights.
Removed
We also completed the acquisitions of substantially all the net assets of RELiON Battery, LLC, SemahTronix, LLC, Fanautic Club, and certain Freedom Boat Club franchise operations and territory rights in the United States during 2021 for net cash consideration of $66.1 million. Refer to Note 4 – Acquisitions in the Notes to the Consolidated Financial Statements for further information.
Added
Boat segment operating earnings decreased versus the prior year due the impact of the net sales declines and lower absorption from reduced production, partially offset by pricing and cost control measures.
Removed
The increase is primarily due to the discrete income tax expense recorded in connection with the intercompany sales of intellectual property rights in the first and third quart ers of 2023.
Added
Our capital spending was focused on investments in new products and technologies.
Removed
Due to the factors described in the preceding paragraphs, operating earnings, net earnings from continuing operations, and diluted earnings per common share from continuing operations decreased during 2023.
Added
The level of borrowing capacity under our Credit Facility and CP Program is limited by both a leverage and interest coverage test. These covenants also pertain to termination provisions included in our wholesale financing joint-venture arrangements with Wells Fargo Commercial Distribution Finance.
Removed
Diluted earnings per common share from continuing operations benefited from common stock repurchases in both years. 34 Tab l e of Content s 2022 vs. 2021 Net sales increased 16.5 percent during 2022 when compared with 2021.
Added
We recorded an $80.0 million impairment of the Navico Group reporting unit's goodwill during the year ended December 31, 2024. We did not record any goodwill impairments in 2023 or 2022. 40 Table of Contents Other Intangible Assets. Our primary other intangible assets are customer relationships, trade names, and developed technology acquired in business combinations.
Removed
The components of the consolidated net sales change were as follows: Percent change in net sales compared to the prior year 2022 Product Mix and Price 9.9 % Acquisitions 7.1 % Volume 1.7 % Currency (2.2) % 16.5 % Sales in each segment benefited from steady demand, new product performance, and pricing implemented throughout the year, partially offset by unfavorable changes in foreign currency exchange rates.
Added
The costs of amortizable intangible assets are recognized over their expected useful lives, typically between three and fifteen years, using the straight-line method. Intangible assets that are subject to amortization are evaluated for impairment using a process similar to that used to evaluate long-lived assets.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+1 added−0 removed5 unchanged
Biggest changeWe use foreign currency forward and option contracts to manage foreign exchange rate exposure related to anticipated transactions, and assets and liabilities that are subject to risk from foreign currency rate changes. Our principal currency exposures mainly relate to the Euro, Canadian dollar, Australian dollar, and the Brazilian Real.
Biggest changeWe do not use financial instruments for trading or speculative purposes. 41 Table of Contents We use foreign currency forward and option contracts to manage foreign exchange rate exposure related to anticipated transactions, and assets and liabilities that are subject to risk from foreign currency rate changes.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risk from changes in foreign currency exchange rates, commodity prices and interest rates. We enter into various hedging transactions to mitigate certain risks in accordance with guidelines established by our management. We do not use financial instruments for trading or speculative purposes.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risk from changes in foreign currency exchange rates, commodity prices and interest rates. We enter into various hedging transactions to mitigate certain risks in accordance with guidelines established by our management.
The estimated reduction in fair market value that we would incur on our derivative financial instruments from a 10 percent adverse change in quoted foreign currency rates are $91.7 million and $71.6 million for the years 2023 and 2022, respectively.
The estimated reduction in fair market value that we would incur on our derivative financial instruments from a 10 percent adverse change in quoted foreign currency rates are $69.3 million and $91.7 million for the years 2024 and 2023, respectively. Item 8. Financial Statements and Supplementary Data See Index to Financial Statements and Financial Statement Schedule on page 52 .
We hedge certain anticipated transactions with financial instruments whose maturity date, along with the realized gain or loss, occurs on or near the execution of the anticipated transaction.
Our principal currency exposures mainly relate to the Euro, Canadian dollar, Australian dollar, and the Brazilian Real. We hedge certain anticipated transactions with financial instruments whose maturity date, along with the realized gain or loss, occurs on or near the execution of the anticipated transaction.
Added
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None.

Other BC 10-K year-over-year comparisons