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What changed in MARINE PRODUCTS CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of MARINE PRODUCTS CORP's 2024 and 2025 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 2025 report.

+237 added−187 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in MARINE PRODUCTS CORP's 2025 10-K

237 paragraphs added · 187 removed · 146 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

60 edited+14 added−17 removed39 unchanged
Biggest changeWarranties for additional items are provided for periods of one to five years and are not transferable. Claim costs related to components are generally absorbed by the original component manufacturer. The manufacturers of the engines, generators, and navigation electronics included on our boats provide and administer their own warranties for various lengths of time.
Biggest changeProduct Warranty For our Chaparral and Robalo products, Marine Products provides a lifetime limited structural hull warranty and a transferable one-year limited warranty to the original owner. Warranties for additional items are provided for periods of one to five years and are not transferable. Claim costs related to components are generally absorbed by the original component manufacturer.
Outboard engines are purchased from Yamaha under a multi-year joint marketing agreement and from Mercury Marine under an annually negotiated purchase agreement. In the event of a sudden and extended interruption in the supply of engines from any of these suppliers, our sales and profitability could be negatively impacted. See Item 1A Risk Factors below. Customers & Distribution Dealer Network.
Outboard engines are purchased from Yamaha under a multi-year joint marketing agreement and Mercury Marine under an annually negotiated purchase agreement. In the event of a sudden and extended interruption in the supply of engines from any of these suppliers, our sales and profitability could be negatively impacted. See Item 1A Risk Factors below. Customers & Distribution Dealer Network.
The Company currently has an agreement with one of the floor plan lenders whereby the contractual repurchase limit is based on the highest of the following criteria: (i) a specified percentage of the amount of the average net receivables financed by the floor plan lender for our dealers, (ii) the total average net receivables financed by the floor plan lender for our two highest dealers for the three highest monthly receivables balances during the past twelve months, or (iii) $8.0 million, less repurchases during the prior 12 month period.
The Company currently has an agreement with one of the floor plan lenders whereby the contractual repurchase limit is based on the highest of the following criteria: (i) a specified percentage of the average net receivables financed by the floor plan lender for our dealers, (ii) the total average net receivables financed by the floor plan lender for our two highest dealers for the three highest monthly receivables balances during the past twelve months, or (iii) $8.0 million, less repurchases during the prior 12 month period.
Item 1. Business Marine Products manufactures fiberglass motorized boats distributed and marketed through its independent dealer network. Marine Products’ product offerings include Chaparral sterndrive and outboard pleasure boats and Robalo outboard sport fishing boats. Organization & Overview Marine Products is a Delaware corporation incorporated on August 31, 2000, in connection with a spin-off from RPC, Inc. (NYSE: RES) (“RPC”).
Item 1. Business Marine Products manufactures fiberglass motorized boats distributed and marketed through its independent dealer network. Marine Products’ product offerings include Chaparral sterndrive and outboard sport boats and Robalo outboard sport fishing boats. Organization & Overview Marine Products is a Delaware corporation incorporated on August 31, 2000, in connection with a spin-off from RPC, Inc. (NYSE: RES) (“RPC”).
Thus, the value of the inventory incurs a carrying costs, or interest cost, each month. Since the financial crisis in 2008, the U.S. market has enjoyed historically low interest rates, which have been a key support factor for the housing, auto, and other large/financed purchases, including large discretionary items like recreational vehicles and boats.
Thus, the value of the inventory incurs a carrying cost, or interest cost, each month. Since the financial crisis in 2008, the U.S. market has enjoyed historically low interest rates, which have been a key support factor for the housing, auto, and other large/financed purchases, including large discretionary items like recreational vehicles and boats.
In assessing MPX’s strategy, financial condition and operating performance, management generally reviews results and trends related to sales, plant utilization, pricing, cost structure, profitability, cash flows and the return on our invested capital. We also monitor industry-wide and general macro-economic factors that impact dealer order activity.
In assessing MPX’s strategy, financial condition and operating performance, management generally reviews results and trends related to sales, plant utilization, pricing, cost structure, profitability, cash flows and 12 ​ the return on our invested capital. We also monitor industry-wide and general macro-economic factors that impact dealer order activity.
Effective February 28, 2001, RPC accomplished the spin-off by contributing 100% of the issued and outstanding stock of Chaparral to Marine Products, a newly formed, wholly owned subsidiary of RPC, and then distributing the common stock of Marine Products to RPC stockholders. Marine Products designs, manufactures and sells recreational fiberglass powerboats in the sport boat and sport fishing boat markets.
Effective February 28, 2001, RPC accomplished the spin-off by contributing 100% of the issued and outstanding stock of Chaparral to Marine Products, a newly formed, wholly owned subsidiary of RPC, and then distributing the common stock of Marine Products to RPC stockholders. Marine Products designs, manufactures and sells recreational fiberglass powerboats in the pleasure boat and sport fishing boat markets.
The combination of low inventory levels and high demand through the first half of 2023 forced the Company to allocate its production to dealers to fulfill as many orders as possible and rebuild dealer inventories. Beginning in the second half of 2023, demand began softening and inventories were replenished, quickly resulting in excess channel inventory heading into 2024.
The combination of low inventory levels and high demand through the first half of 2023 forced the Company to allocate its production to dealers to fulfill as many orders as possible and rebuild 11 ​ dealer inventories. Beginning in the second half of 2023, demand began softening and inventories were replenished, quickly resulting in excess channel inventory heading into 2024.
The Occupational Safety and Health Administration (“OSHA”) standards limit the number of emissions to which an employee may be exposed without the need for respiratory protection or upgraded plant 12 ​ ventilation. Marine Products’ manufacturing facilities are regularly inspected by OSHA and by state and local inspection agencies and departments.
The Occupational Safety and Health Administration (“OSHA”) standards limit the number of emissions to which an employee may be exposed without the need for respiratory protection or upgraded plant ventilation. Marine Products’ manufacturing facilities are regularly inspected by OSHA and by state and local inspection agencies and departments.
During 2021 and 2022, however, 10 ​ extraordinarily high dealer and consumer post-pandemic demand combined with the Company’s production delays resulting from supply chain disruptions caused dealer inventories to fall to historic lows.
During 2021 and 2022, however, extraordinarily high dealer and consumer post-pandemic demand combined with the Company’s production delays resulting from supply chain disruptions caused dealer inventories to fall to historic lows.
Marketed with national fixed retail prices to experienced fishermen and families looking for both fishing and cruising features. ​ ​ ​ ​ ​ ​ ​ ​ 7 ​ Manufacturing Marine Products’ manufacturing facilities are located in Nashville, Georgia, in what management believes is the largest single-site sport boat production plant in the U.S.
Marketed with national fixed retail prices to experienced fishermen and families looking for both fishing and cruising features. ​ ​ ​ ​ ​ ​ ​ ​ ​ 8 ​ Manufacturing Marine Products’ manufacturing facilities are located in Nashville, Georgia, in what management believes is the largest single-site sport boat production plant in the U.S.
Of note, no single dealer nor any group of dealers owned by the same parent company accounted for 10% or more of net sales during 2024, 2023 or 2022. Most of our dealers also sell boat brands manufactured by other companies, including some that compete directly with our brands.
Of note, no single dealer nor any group of dealers owned by the same parent company accounted for 10% or more of net sales during 2025, 2024 or 2023. Most of our dealers also sell boat brands manufactured by other companies, including some that compete directly with our brands.
Approximately 69% of Marine Products’ domestic shipments are made pursuant to “floor plan financing” (or “FPF”) programs in which Marine Products’ subsidiaries participate on behalf of their dealers with major third-party financing institutions. The remaining dealers finance their boat inventory with smaller regional financial institutions or self-finance.
Approximately 76% of Marine Products’ domestic shipments are made pursuant to “floor plan financing” (or “FPF”) programs in which Marine Products’ subsidiaries participate on behalf of their dealers with major third-party financing institutions. The remaining dealers finance their boat inventory with smaller regional financial institutions or self-finance.
Subsequently, the rise in interest rates, economic uncertainty, and a slowdown in boat demand resulted in the dealer channel holding excess inventory, which has negatively impacted sales during 2024 (more detailed recent trends are discussed below in the Industry Overview & Key Themes section).
Subsequently, the rise in interest rates, economic uncertainty, and a slowdown in boat demand resulted in the dealer channel holding excess inventory, which negatively impacted sales during 2024 and 2025 (more detailed recent trends are discussed below in the Industry Overview & Key Themes section).
The step also functions as seating, creating a semi-submerged bench. Other areas that the Company has invested R&D resources include 3-D printers for parts development and production and virtual reality software to aid in the design of our boats.
The step also functions as seating, creating a semi-submerged bench. Other areas in which the Company has invested R&D resources include 3-D printers for parts development and production and virtual reality software to aid in the design of our boats.
In response to rapid inflation following the strong post-pandemic economic conditions, the Federal Reserve began quickly raising short-term borrowing rates in early 2022 from near-zero to over 5% by mid-2023, and have since modestly reduced rates into the mid-4% range. The rapid pace of interest increases had a negative impact on the marine industry.
In response to rapid inflation following the strong post-pandemic economic conditions, the Federal Reserve began quickly raising short-term borrowing rates in early 2022 from near-zero to over 5% by mid-2023, and have since modestly reduced rates into the mid- 3% range. The rapid pace of interest rate increases had a negative impact on the marine industry.
Marketing & Promotions/Incentives. As the Company does not sell directly to consumers, it relies on the dealer network to promote the brands and educate consumers about our boats’ features and performance. The Company invests time and resources to supporting our dealers’ promotional efforts and ensuring they are well-equipped to position our boats favorably in the marketplace with consumers.
As the Company does not sell directly to consumers, it relies on the dealer network to promote the brands and educate consumers about our boats’ features and performance. The Company invests time and resources to supporting our dealers’ promotional efforts and ensuring they are well-equipped to position our boats favorably in the marketplace with consumers.
For the 2025 model year (which commenced July 1, 2024), Marine Products offered its dealers several sales incentive programs based on dollar volume and timing of dealer purchases.
For the 2026 model year (which commenced July 1, 2025), Marine Products offered its dealers several sales incentive programs based on dollar volume and timing of dealer purchases.
The Company sells its products to a network of 202 domestic and 88 international independent authorized dealers. Marine Products’ mission is to enhance its customers’ boating experience by providing them with high quality, innovative powerboats. The Company’s two brands are Chaparral (sport boats) and Robalo (fishing boats): Chaparral was founded in 1965 in Ft. Lauderdale, Florida.
The Company sells its products to a network of 192 domestic and 84 international independent authorized dealers. Marine Products’ mission is to enhance its customers’ boating experience by providing them with high quality, innovative powerboats. The Company’s two brands are Chaparral (sport boats) and Robalo (fishing boats): Chaparral was founded in 1965 in Ft. Lauderdale, Florida.
Management believes over the past 18 months the marine industry, and the Company, have experienced reduced sales due to several factors: (1) the impact of several years of selling price increases to offset input cost inflation, (2) a period of rapidly rising interest rates that increased financing costs of boat ownership, consumer uncertainty around the U.S. economy and disposable income, and (3) a general oversupply of boat inventories in the retail channel relative to consumer and dealer demand.
Management believes that since that time the marine industry, and the Company, have experienced reduced sales due to several factors: (1) the impact of several years of selling price increases to offset input cost inflation, (2) a period of rapidly rising interest rates that increased financing costs of boat ownership, consumer uncertainty around the U.S. economy and disposable income, and (3) a general oversupply of boat inventories in the retail channel relative to consumer and dealer demand.
Availability of Filings Marine Products makes available free of charge on its website, MarineProductsCorp.com, the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports on the same day as they are filed with the Securities and Exchange Commission. 14 ​
Availability of Filings Marine Products makes available free of charge on its website, MarineProductsCorp.com, the annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports on the same day as they are filed with the SEC. 14 ​
The Explorer series features extra seating options. ​ ​ ​ ​ ​ ​ ​ Robalo – Cayman Bay Boats 6 20′-26′ ​ $57,000 - $233,000 Fiberglass outboard powered sport fishing boats for large freshwater lakes or coastal saltwater use. Marketed to experienced fishermen wanting inshore and offshore capabilities.
The Explorer series features extra seating options. ​ ​ ​ ​ ​ ​ ​ ​ Robalo – Cayman Bay Boats 6 20′-26′ ​ $57,500 - $245,500 Fiberglass outboard powered sport fishing boats for large freshwater lakes or coastal saltwater use. Marketed to experienced fishermen wanting inshore and offshore capabilities.
Human Capital The table below shows the number of employees at December 31, 2024 and 2023: ​ ​ ​ ​ ​ At December 31, 2024 2023 Employees 617 690 ​ The recreational boating industry is cyclical and therefore headcount is subject to change based on production levels which are a function of dealer and consumer demand.
Human Capital The table below shows the number of employees at December 31, 2025 and 2024: ​ ​ ​ ​ ​ At December 31, ​ ​ ​ 2025 ​ ​ ​ 2024 Employees 698 617 ​ The recreational boating industry is cyclical and therefore headcount is subject to change based on production levels which are a function of dealer and consumer demand.
Marketed as high value, luxury runabouts for family groups. ​ ​ ​ ​ ​ ​ ​ ​ ​ Chaparral – Surf Series 5 21′-30′ ​ $80,000 - $352,000 This model line features a forward-facing sterndrive engine. Fiberglass multipurpose bowriders, the Surf Series models are marketed to both experienced and value-conscious buyers.
Marketed as high value, luxury runabouts for family groups. ​ ​ ​ ​ ​ ​ ​ ​ ​ Chaparral – GTS - SURF (Formerly Surf Series) 5 21′-30′ ​ $80,000 - $375,500 This model line features a forward-facing sterndrive engine. Fiberglass multipurpose bowriders, the Surf Series models are marketed to both experienced and value-conscious buyers.
These boats are designed to enhance the wake of the boat to accommodate the popular sport of wake surfing. ​ ​ ​ ​ ​ ​ ​ Chaparral – OSX Sport Boats 4 26′-32′ ​ $145,000 - $487,000 Fiberglass, multipurpose sport boats with outboard power featuring plentiful seating and entertaining areas, cabin and bathroom accommodations, excellent performance, and luxury finishes. ​ ​ ​ ​ ​ ​ ​ ​ ​ Robalo – Center Consoles 12 16′-36′ ​ $36,000 - $688,000 Fiberglass outboard sport fishing boats for large freshwater lakes or saltwater use.
These boats are designed to enhance the wake of the boat to accommodate the popular sport of wake surfing. ​ ​ ​ ​ ​ ​ ​ ​ Chaparral – OSX Sport Boats 4 26′-32′ ​ $148,500 - $507,500 Fiberglass, multipurpose sport boats with outboard power featuring plentiful seating and entertaining areas, cabin and bathroom accommodations, excellent performance, and luxury finishes. ​ ​ ​ ​ ​ ​ ​ ​ ​ Robalo – Center Consoles 12 16′-36′ ​ $36,000 - $724,000 Fiberglass outboard sport fishing boats for large freshwater lakes or saltwater use.
All models marketed with a trailer at national fixed retail prices. ​ ​ ​ ​ ​ ​ ​ Robalo – Dual Consoles 3 20′-31′ ​ $64,000 - $372,000 Multi-purpose fiberglass outboard powered sport fishing boats for large freshwater lakes or saltwater use.
All models marketed with a trailer at national fixed retail prices. ​ ​ ​ ​ ​ ​ ​ ​ Robalo – Dual Consoles 4 20′-31′ ​ $64,500 - $411,500 Multi-purpose fiberglass outboard powered sport fishing boats for large freshwater lakes or saltwater use.
Not only did the interest rate used in calculating dealer carrying costs increase dramatically, the “borrowing base” increased as well due to the large prices increases in the preceding years; thus while the units of boats in dealer inventories increased, the impact was worsened because the outstanding balances on their floorplan financing had risen with the value of the boats purchased.
Not only did the interest rates used in calculating dealer carrying costs increase dramatically, the “borrowing base” increased as well due to the large boat model price increases in the preceding years; thus while the units of boats in dealer inventories increased, the impact was worsened because the outstanding balances on their floorplan financing arrangements had risen with the cost of the boats purchased.
Unlike large-scale automotive production, the lack of mass volume production, the customization required for each boat, and the high standard of craftsmanship to support our brands’ reputation lend themselves to a manual process with a highly skilled workforce.
Unlike large-scale automotive production, the lack of mass volume production, the customization required for each boat, and the high standard of craftsmanship to support our brands’ reputation lend themselves to a manual process with a highly skilled workforce. The Company prides itself on the experience and quality of our production staff.
The Company does not typically maintain a significant inventory of finished boats. In a typical ordering, production and delivery cycle, the Company monitors dealer inventory levels in order to inform its production scheduling to keep manufacturing in line with end-market demand, and to ensure that dealers are carrying the appropriate levels of inventory.
In a typical ordering, production and delivery cycle, the Company monitors dealer inventory levels in order to inform its production scheduling to keep manufacturing in line with end-market demand, and to ensure that dealers are carrying the appropriate levels of inventory.
We believe that dealer inventories of our boat models as of December 31, 2024 are sufficient to meet the current level of retail customer demand. The sales order backlog as of December 31, 2024 was 655 boats with estimated net sales of approximately $53.4 million. This represents an approximate 11.7 week backlog based on recent production levels.
We believe that dealer inventories of our boat models as of December 31, 2025 are sufficient to meet the current level of retail customer demand. The sales order backlog as of December 31, 2025 was 766 boats with estimated net sales of approximately $68.9 million. This represents an approximate 14.7 week backlog based on recent production levels.
The contractual agreements that we have with these qualified lenders contain the Company’s assumption of specified percentages of the debt obligation on repossessed boats, up to certain contractually determined dollar limits negotiated with the lender.
The contractual agreements that we have with these qualified lenders contain the Company’s assumption of specified percentages of the debt obligation on repossessed boats, up to certain contractually determined dollar limits negotiated with the lender. These arrangements are described in more detail below.
All marketed with national fixed retail prices. ​ ​ ​ ​ ​ ​ ​ Chaparral – SSX Sport Boats ​ 4 ​ 24′-30′ ​ $132,000 - $326,000 ​ Fiberglass sterndrive and outboard powered models that combine features of sport boats and bowriders.
All marketed with national fixed retail prices. ​ ​ ​ ​ ​ ​ ​ ​ Chaparral – SSX Sport Boats ​ 6 ​ 24′-30′ ​ $136,000 - $365,000 ​ Fiberglass sterndrive and outboard powered models that combine features of sport boats and bowriders.
Higher interest rates also impact our dealers, as their boat purchases are financed and they bear much of the carrying costs of holding inventories. Lastly, the Company incurs higher costs from rising interest rates because we often pay a portion of dealer floor plan interest costs as part of our dealer sales incentive programs.
Higher interest rates also impact many of our dealers, as their inventories are financed and they bear much of the carrying costs related to boats held in inventory. Lastly, the Company incurs higher costs from rising interest rates because we often pay a portion of dealer floor plan interest as part of our dealer sales incentive programs.
The Company believes that the 2022 and 2023 increases in interest rates (which is generally linked to higher inflation) have reduced retail demand for smaller boats, since purchasers of smaller boats are typically more sensitive to increases in the cost of boat ownership and typically finance their purchases.
The Company believes that increases in interest rates in recent years (which were generally linked to higher inflation) reduced retail demand for smaller boats, because purchasers of smaller boats are typically more sensitive to increases in the cost of boat ownership and typically finance their purchases.
Domestic sales are generated through our independent dealer network of approximately 202 U.S. dealers, of which 64 are Chaparral dealers, 47 are Robalo dealers and 91 dealers sell both brands. Marine Products also has 88 international dealers. As a percentage of our total net sales, international sales represented 5.6% in 2024, 5.9% in 2023 and 6.7% in 2022.
Domestic sales are generated through our independent dealer network of approximately 192 U.S. dealers, of which 56 are Chaparral dealers, 48 are Robalo dealers and 88 dealers sell both brands. Marine Products also has 84 international dealers. As a percentage of our total net sales, international sales represented 4.5% in 2025, 5.6% in 2024 and 5.9% in 2023.
The Company’s key human capital management objectives are focused on fostering talent in the following areas: Workplace Inclusion - The Company’s workforce reflects the diversity of the community in which it operates. Our dedicated team of employees work toward a common purpose.
The Company’s key human capital management objectives are focused on fostering talent in the following areas: Workplace Inclusion - The Company’s workforce reflects the diversity of the community in which it operates. Our dedicated team of employees work toward a common purpose. We provide employment in a small community which we have supported as the largest employer since 1976.
The territories served by our dealers are not exclusive to the dealer; however, Marine Products uses discretion in establishing relationships with new dealers in an effort to protect the mutual interests of the existing dealers and the Company.
The territories served by our dealers are not exclusive to the dealer; however, Marine Products uses discretion in establishing relationships with new dealers in an effort to protect the mutual interests of the existing dealers and the Company. Marine Products 9 ​ has six independent field sales representatives who manage relationships with existing dealers and develop new dealer relationships.
In support of new product development efforts, Marine Products incurred research and development costs of $762 thousand in 2024, $757 thousand in 2023, and $437 thousand in 2022.
In support of new product development efforts, Marine Products incurred research and development costs of $1.5 million in 2025, $762 thousand in 2024, and $757 thousand in 2023.
We also supplement local advertising, sales and marketing follow-up in boating magazines, and participation in selected regional, national, and international boat show exhibitions, as well as developing virtual marketing programs. Orders & Inventory. Marine Products’ sales orders are indicators of strong interest from its dealers. Historically, dealers have in most cases taken delivery of all their orders.
Historically, we have also supplemented local advertising, sales and marketing follow-up in boating magazines, and have participated in selected regional, national, and international boat show exhibitions, as well as having developed virtual marketing programs. Orders & Inventory. Marine Products’ sales orders are indicators of strong interest from its dealers.
The Company does not manufacture the engines installed in its boats. Engines are generally specified by the dealers at the time of ordering a boat, usually based on anticipated customer preferences or actual customer orders. Sterndrive engines are purchased from Mercury Marine and Volvo Penta, under annually negotiated purchase agreements.
Engines are generally specified by the dealers at the time of ordering a boat, usually based on anticipated customer preferences or actual customer orders. Sterndrive engines are purchased from Mercury Marine under an annually negotiated purchase agreement and from Volvo Penta on a purchase order basis.
Within this fragmented market, there are many categories of size and boat type, which can make market share data somewhat difficult to compare given the subjectivity of criteria and “market share” definition and parameters.
Within this fragmented market, there are many categories of size and boat type, which can make market share data somewhat difficult to compare given the subjectivity of criteria and “market share” definition and parameters. Our highly fragmented industry has intense competition for customers, dealers and boat show exhibition space.
The following table provides a brief description of our product lines and their particular market focus: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number ​ ​ ​ Approximate ​ ​ ​ Of ​ Overall ​ Retail ​ Product Line Models Length Price Range Description Chaparral – SSi Sport Boats ​ 7 ​ 20′-23′ ​ $48,500 - $105,000 ​ Fiberglass sterndrive and outboard powered sport boats marketed as high value runabout for smaller to larger groups.
The following table provides a brief description of our product lines and their particular market focus: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number ​ ​ ​ Approximate ​ ​ ​ of ​ Overall ​ Retail ​ Product Line ​ ​ ​ Models ​ ​ ​ Length ​ ​ ​ Price Range ​ ​ ​ Description Chaparral – SSi Sport Boats ​ 8 ​ 19′-23′ ​ $49,000 - $107,000 ​ Fiberglass sterndrive and outboard powered sport boats marketed as high value runabouts.
Proprietary Matters Marine Products owns several trademarks, trade names and patents that it believes are important to its business. Except for the Chaparral and Robalo trademarks, Marine Products is not dependent upon any single trademark or trade name or group of trademarks or trade names. The Chaparral and Robalo trademarks are currently registered in the United States.
Except for the Chaparral and Robalo trademarks, Marine Products is not dependent upon any single trademark or trade name or group of trademarks or trade names. The Chaparral and Robalo trademarks are currently registered in the United States.
Both Chaparral and Robalo have long expanded the range of their offerings through insightful, innovative product design and quality manufacturing processes in order to reach an increasingly discerning recreational boating market.
Research and Development Marine Products has been a leading innovator in the recreational boating industry offering exceptional quality and consumer value. Both Chaparral and Robalo have long expanded the range of their offerings through insightful, innovative product design and quality manufacturing processes in order to reach an increasingly discerning recreational boating market.
The sales order backlog as of December 31, 2023 was 1,243 boats with estimated net sales of approximately $92.3 million. This represented an approximate 20.7 week backlog based on production levels at that time.
The sales order backlog as of December 31, 2024 was 655 boats with estimated net sales of approximately $53.4 million. This represented an approximate 11.7 week backlog based on production levels at that time. Floor Plan Financing.
The increased cost of boat ownership and sentiment around higher interest rates potentially causing a recession (and the potential for lower rates in the future) are also believed to have negatively impacted consumer demand for boats. Competition The recreational boat manufacturing market remains highly fragmented, although some publicly traded companies own a diversified group of recreational boat brands.
The increased cost of boat ownership and sentiment around higher interest rates potentially causing a recession (and the potential for lower rates in the future) are also believed to have negatively impacted consumer demand for boats.
Marine Products has six independent field sales representatives who manage relationships with existing dealers and develop new dealer relationships. 8 ​ Management believes that the five largest states for boat sales at the present time are Florida, Texas, Michigan, North Carolina and Minnesota. The Company has dealers in each of these and many other states across the country.
Management believes that the five largest states for boat sales at the present time are Florida, Texas, Michigan, North Carolina and Minnesota. The Company has dealers in each of these and many other states across the country. Marketing & Promotions/Incentives.
Suppliers Marine Products’ three most significant cost components used in manufacturing its boats are engines, resins and fiberglass. Each are currently adequately supplied and available in the market, however the costs of these components and commodities (including copper and steel) can fluctuate in response to changes in global economic conditions.
Each are currently adequately supplied and available in the market, however the costs of these components and commodities (including copper and steel) can fluctuate in response to changes in global economic and political conditions. The Company does not manufacture the engines installed in its boats.
We provide 13 ​ competitive financial benefits such as a 401(k) retirement plan with a company match, and generally grant awards of restricted stock for certain of our salaried employees.
We have provided health insurance as well as competitive financial benefits such as a 401(k) retirement plan with a company match, and in the past we have granted awards of restricted stock and other equity awards for certain of our salaried employees.
As defined by the agreement, the repurchase limit for this lender was $19.6 million as of December 31, 2024. The Company has contractual repurchase agreements with additional lenders with an aggregate maximum repurchase obligation of $5.4 million, with various expiration and cancellation terms of less than one year.
Lastly, the Company has contractual repurchase agreements with other lenders with an aggregate maximum repurchase obligation of $1.5 million with various expiration and cancellation terms of less than one year, for an aggregate repurchase obligation with all floor plan financing institutions of $29.6 million as of December 31, 2025.
Robalo was founded in 1969 and was acquired by Marine Products in 2001, in conjunction with the spin-off from RPC as referenced above.
Robalo was founded in 1969 and was acquired by Marine Products in 2001, in conjunction with the spin-off from RPC as referenced above. At the time of the acquisition, Robalo was a struggling brand, which Marine Products has since grown to a leading fishing boat manufacturer.
However, the Company believes the cost of boat ownership has risen enough to impact retail demand. Therefore, it may be more difficult to raise prices in the future to compensate for increased costs of raw materials and components, which could impact the Company’s sales and profit margins.
Therefore, it may be more difficult to raise prices in the future to compensate for increased costs of raw materials and components, which could impact the Company’s sales and profit margins. In addition, the ongoing tariff developments and associated supply chain disruptions could result in a resumption in inflationary pressures.
Strategy The Company has historically aimed to grow its boat sales, net sales and market share by differentiating our product lines through industry-leading feature innovations and designs. To achieve these objectives, we plan to execute strategic investments, both organic and potential M&A, that we believe will increase our scale, enhance our product offering, and improve our profitability and cash flow.
Strategy The Company has historically aimed to grow its boat sales, net sales and market share by differentiating our product lines through industry-leading feature innovations and designs.
Annual review of the Code is required, and the Code prohibits unlawful or unethical activity, including discrimination, and directs our employees, officers, and directors to avoid actions that, even if not unlawful or unethical, might create an appearance of illegality or impropriety. In addition, the Company provides annual training for preventing, identifying, reporting and stopping any type of unlawful discrimination.
We have implemented and maintained a corporate compliance program to provide guidance for everyone associated with the Company, including its employees, officers and directors (the “Code”). The Code prohibits unlawful or unethical activity, including discrimination, and directs our employees, officers, and directors to avoid actions that, even if not unlawful or unethical, might create an appearance of illegality or impropriety.
At the time of the acquisition, Robalo was a struggling brand, which Marine Products has since grown to a leading fishing boat manufacturer. ​ 6 ​ Products Marine Products distinguishes itself by offering a wide range of products to the family recreational markets through its Chaparral brands and to the sport fishing market through its Robalo brands.
See also Item 1A. Risk Factors for a discussion of risks related to the Mergers. 7 ​ Products Marine Products distinguishes itself by offering a wide range of products to the family recreational markets through its Chaparral brands and to the sport fishing market through its Robalo brands.
Our highly fragmented industry has intense competition for customers, dealers and boat show exhibition space. There is significant competition both within geographic and product/category markets we currently serve and in new markets that we may enter. Marine Products’ brands compete with several large national or regional manufacturers that have substantial financial, marketing and other resources.
There is significant competition both within geographic and product/category markets we currently serve and in new markets that we may enter. Marine Products’ brands compete with large national, regional, and smaller manufacturers throughout the U.S. boat manufacturing industry, and particularly with those manufacturers that operate in the pleasure boats and outboard sport fishing boats categories in which we operate.
Compensation and Benefits - The Company focuses on attracting and retaining employees by providing compensation and benefit packages that are competitive in the market, taking into account the location and responsibilities of the job.
From time to time, the Company has rewarded employee tenure through various bonus programs for its hourly employees based on attendance and job performance. Compensation and Benefits - The Company has historically aimed to provide compensation and benefit packages that are competitive in the market, taking into account the location and responsibilities of the job.
Development and Training - The Company’s management team and all its employees are expected to exhibit and promote honest, ethical and respectful conduct in the workplace. We have implemented and maintained a corporate compliance program to provide guidance for everyone associated with the Company, including its employees, officers and directors (the “Code”).
Our company is strong in its values and relationships, and we regularly monitor compliance with applicable non-discrimination laws related to race, gender and other protected classes. Development and Training - The Company’s management team and all its employees are expected to exhibit and promote honest, ethical and respectful conduct in the workplace.
Safety - Marine Products monitors several safety measures and reports them to senior operational management on a regular basis. Management reviews safety incidents, and the Company works to remediate operational issues that may be potential causes of any frequent incidents. In addition, the Company awards safety bonuses to the drivers of its company-owned vehicles based on their driving records.
Management reviews safety incidents, and the Company works to remediate operational issues that may be potential causes of any frequent incidents. Proprietary Matters Marine Products owns several trademarks, trade names and patents that it believes are important to its business.
Employee Retention - Marine Products monitors voluntary employee turnover and reports these statistics to senior operational management. From time to time, the Company has rewarded employee tenure through various bonus programs for its hourly employees based on attendance and job performance.
In addition, the Company has provided annual training for preventing, identifying, reporting and stopping any type of unlawful discrimination. 13 ​ Employee Retention - Marine Products monitors voluntary employee turnover and reports these statistics to senior operational management.
Removed
The Company prides itself on the experience and quality of our production staff and believe low plant turnover is a key differentiator for Marine Products in the marketplace. Product Warranty For our Chaparral and Robalo products, Marine Products provides a lifetime limited structural hull warranty and a transferable one-year limited warranty to the original owner.
Added
Proposed Mergers with MasterCraft ​ On February 5, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among MasterCraft Boat Holdings, Inc., a Delaware corporation (“MasterCraft”), Titan Merger Sub 1, Inc., a Delaware corporation and a wholly owned, 6 ​ direct subsidiary of MasterCraft (“Merger Sub I”), and Titan Merger Sub 2, LLC, a Delaware limited liability company and a wholly owned, direct subsidiary of MasterCraft (“Merger Sub II”).
Removed
The Company will continue to monitor the number of boats in dealer inventories and adjust its production levels as it deems necessary to manage dealer inventory levels. Floor Plan Financing.
Added
The Merger Agreement, among other things, provides for the combination of MasterCraft and Marine Products in a stock-and-cash transaction whereby (i) Merger Sub I will merge with and into Marine Products (the "First Merger”), with Marine Products surviving the First Merger as a direct wholly owned subsidiary of MasterCraft, and (ii) immediately following the First Merger, Marine Products will merge into Merger Sub II (the "Second Merger” and, together with the First Merger, the "Mergers”), with Merger Sub II surviving the Second Merger as a wholly owned subsidiary of MasterCraft. ​ Under the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the First Merger (the “First Effective Time”), each share of Marine Products common stock, par value $0.10 per share, will be converted into the right to receive 0.232 shares (the “Stock Consideration”) of MasterCraft common stock and $2.43 in cash, without interest (the “Cash Consideration” and, together with the Stock Consideration, the “Merger Consideration”). ​ The completion of the Mergers is subject to customary closing conditions, including, but not limited to: (i) the approval of the Merger Agreement by the affirmative vote of the holders of a majority in voting power of the outstanding Marine Products common stock entitled to vote thereon, (ii) the approval of the issuance of shares of MasterCraft common stock to be issued in the First Merger by the affirmative vote of the holders of a majority in voting power of the outstanding MasterCraft common stock present in person or by proxy and entitled to vote thereon at a meeting of MasterCraft stockholders, (iii) the absence of any injunction or order by any court or other governmental entity restraining, enjoining, preventing or otherwise prohibiting the consummation of the Mergers, (iv) the shares of MasterCraft common stock to be issued in the First Merger being approved for listing on the Nasdaq, (v) the effectiveness of the registration statement on Form S-4 pursuant to which the shares of MasterCraft common stock to be issued in the First Merger will be registered with the U.S.
Removed
Accordingly, the aggregate repurchase obligation with all financing institutions was approximately $25.0 million as of December 31, 2024. In the event that a dealer defaults on a credit line, the qualified lender may then invoke the manufacturer’s repurchase obligation with respect to that dealer.
Added
Securities and Exchange Commission (the “SEC”), (vi) the expiration or termination of the waiting period (and any extension thereof) required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (the “HSR Act”), and (vii) the absence of a material adverse effect with respect to each of MasterCraft and Marine Products. ​ Further information regarding the Mergers is provided in our Current Report on Form 8-K filed with the SEC on February 5, 2026.
Removed
In that event, all repurchase agreements 9 ​ of all manufacturers supplying a defaulting dealer are generally invoked regardless of the boat or boats with respect to which the dealer has defaulted. Unlike Marine Products’ obligation to repurchase boats repossessed by qualified lenders, Marine Products is under no obligation to repurchase boats directly from dealers.
Added
The manufacturers of the engines, generators, and navigation electronics included on our boats provide and administer their own warranties for various lengths of time. Suppliers Marine Products’ three most significant cost components used in manufacturing its boats are engines, resins and fiberglass.
Removed
Marine Products does not sponsor financing programs to the retail consumer; any consumer financing promotions for a prospective boat purchaser would be the responsibility of the dealer.
Added
Historically, dealers have in most cases taken delivery of all their orders. The Company does not typically maintain a significant inventory of finished boats.
Removed
In 2024, the Company entered into a three-year floor plan financing agreement with a single third-party lender which will be phased in beginning in the first quarter of 2025 to replace a majority of the existing agreements with the current third-party lenders.
Added
Despite the higher repurchase commitments described below, we have agreed in the Merger Agreement to limit repurchases pursuant to floorplan financing arrangements to $500,000 individually or $1,000,000 in the aggregate during the time period between the execution of the Merger Agreement and the completion of the Mergers except as specifically approved by MasterCraft.
Removed
The agreement is substantially similar to the current arrangements with the existing third-party floor plan lenders and provides for certain additional incentives to the Company and qualifying dealers over the term of the agreement. Research and Development Marine Products has been a leading innovator in the recreational boating industry offering exceptional quality and consumer value.
Added
As defined by the agreement, the repurchase limit for this lender was $9.3 million as of December 31, 2025.
Removed
For illustrative purposes, the Company estimates overall its (and other leading companies’) U.S. market share by key categories and sizes as follows, according to Statistical Surveys, Inc. during the latest reported year ended September 30, 2024): ● The top five sterndrive model manufacturers of boats in lengths from 21 to 34 feet, which includes Marine Products’ Chaparral brand, have a combined market share of approximately 85%; Marine Products’ Chaparral brand was the second largest of these brands with a share of approximately 23% of this category. ● The top five outboard model manufacturers of boats in lengths from 18 to 36 feet, which includes Marine Products’ Robalo and Chaparral (outboard only) brands, have a combined market share of approximately 35%; Robalo is the fourth largest brand of outboard boats in the United States with a market share of 4.3%, and when combined with Chaparral outboards, the Company holds the fourth highest position in the outboard market of this size range, with a market share of approximately 6%.
Added
In addition, the Company has an 10 ​ agreement with a floorplan lender whereby the contractual repurchase limit is based on the highest of the following criteria: (i) a specified percentage of the average net receivables financed by the floor plan lender for our dealers, or (ii) $18.8 million through June 30, 2026, reducing to $3.0 million beginning July 1, 2026.
Removed
Such competitors include Brunswick Corporation, Sea Hunt Boats, Malibu Boats, Inc., Mastercraft Boat Holdings, Inc. and Regal Marine Industries, Inc. However, we believe that our corporate financial strength and infrastructure, 11 ​ combined with our design, production, and marketing capabilities and nationwide sales presence enable us to compete effectively against these companies.
Added
As defined by the agreement, the repurchase limit for this lender was $18.8 million as of December 31, 2025.
Removed
Our key strategies can be broken down into 3 categories: operating, growth and capital allocation.
Added
Competition The recreational boat manufacturing market remains highly fragmented, although several large national or regional manufacturers, including Brunswick Corporation, Sea Hunt Boats, Malibu Boats, Inc., MasterCraft Boat Holdings, Inc. and Regal Marine Industries, Inc. own a diversified group of recreational boat brands and have substantial financial, marketing and other resources.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

22 edited+46 added−6 removed49 unchanged
Biggest changeThe failure to integrate acquisitions successfully may divert management’s attention from Marine Products’ existing operations and may damage Marine Products’ relationships with its key dealers and suppliers. Increasing Expectations from Customers, Investors and Other Stakeholders Regarding Our Environmental, Social and Governance (ESG) Practices may Affect Our Business, may Create Additional Costs for Us, or Expose Us to Related Risks.
Biggest changeIncreasing Expectations from Customers, Investors and Other Stakeholders Regarding Our Environmental, Social and Governance (ESG) Practices may Affect Our Business, may Create Additional Costs for Us, or Expose Us to Related Risks. Many companies are receiving greater attention from stakeholders regarding their ESG practices, as well as their oversight of relevant ESG issues.
While such licensing requirements are not expected to be unduly restrictive, regulations may discourage potential first-time buyers, thereby reducing future sales. Risks Related to our Labor Force Marine Products’ Success Will Depend on its Key Personnel, and the Loss of any Key Personnel may Affect its Powerboat Sales.
While such licensing requirements are not expected to be unduly restrictive, regulations may discourage potential first-time buyers, thereby reducing future sales. 17 ​ Risks Related to our Labor Force Marine Products’ Success Will Depend on its Key Personnel, and the Loss of any Key Personnel may Affect its Powerboat Sales.
The failure to satisfy these and other regulatory requirements could cause Marine Products to incur fines or penalties or could increase the cost of operations. The adoption of additional laws, rules and regulations could also increase Marine Products’ costs. 17 ​ The U.S. Environmental Protection Agency (EPA) has adopted regulations affecting many marine propulsion engines.
The failure to satisfy these and other regulatory requirements could cause Marine Products to incur fines or penalties or could increase the cost of operations. The adoption of additional laws, rules and regulations could also increase Marine Products’ costs. The U.S. Environmental Protection Agency (EPA) has adopted regulations affecting many marine propulsion engines.
In addition, the availability of 19 ​ Marine Products common stock to the investing public is limited to the extent that shares are not sold by the executive officers, directors and their affiliates, which could negatively impact the trading price of Marine Products’ common stock, increase volatility and affect the ability of minority stockholders to sell their shares.
In addition, the availability of Marine Products common stock to the investing public is limited to the extent that shares are not sold by the executive officers, directors and their affiliates, which could negatively impact the trading price of Marine Products’ common stock, increase volatility and affect the ability of minority stockholders to sell their shares.
Increased focus on ESG and related decision-making may negatively impact us as customers, investors and other stakeholders may choose not to work with us or reallocate capital or decline to make an investment as a result of their assessment of our ESG practices.
Increased focus on ESG and related decision-making may negatively impact us as customers, investors and other stakeholders may choose not to work with us or reallocate capital or 16 ​ decline to make an investment as a result of their assessment of our ESG practices.
While dealer floor plan credit is currently available for many of our dealers during the 2025 model year, the Company’s sales and profitability could be adversely affected in the event of a decline in floor plan financing availability, or if financing terms change unfavorably. Interest Rates and Fuel Prices Affect Marine Products’ Sales.
While dealer floor plan credit is currently available for many of our dealers during the 2026 model year, the Company’s sales and profitability could be adversely affected in the event of a decline in floor plan financing availability, or if financing terms change unfavorably. Interest Rates and Fuel Prices Affect Marine Products’ Sales.
Marine Products’ success will depend to a significant extent on the continued service of key management personnel. The loss or interruption of the services of any senior management personnel or the inability to attract and retain other qualified management, sales, marketing and technical employees could disrupt Marine Products’ operations and cause a decrease in its sales and profit margins.
Marine Products’ success will depend to a significant extent on the continued service of key personnel. The loss or interruption of the services of any key personnel or the inability to attract and retain other qualified employees, sales, marketing and technical employees could disrupt Marine Products’ operations and cause a decrease in its sales and profit margins.
The Company has elected the “Controlled Corporation” exemption under Section 303A of the New York Stock Exchange (“NYSE”) Listed Company Manual. The Company is a “Controlled Corporation” because a group that includes Gary W. Rollins, Pamela R. Rollins, Amy R. Kreisler and Timothy C.
The Company has elected the “Controlled Corporation” exemption under Section 303A of the New York Stock Exchange (“NYSE”) Listed Company Manual. The Company is a “Controlled Corporation” because a group that includes Amy R. Kreisler and Timothy C.
In addition, depending upon a variety of factors, the Controlling Group may at any time engage in discussions with the Company and its affiliates, and other persons, including retained outside advisers, concerning the Company’s business, management, strategic alternatives and direction, and in their sole discretion, consider, formulate and implement various plans or proposals intended to enhance the value of their investment in the Company.
In addition, depending upon a variety of factors, in the event the Mergers are not completed for any reason, the Controlling Group may at any time engage in discussions with the Company and its affiliates, and other persons, including retained outside advisers, concerning the Company’s business, management, strategic alternatives and direction, and in their sole discretion, consider, formulate and implement various plans or proposals intended to enhance the value of their investment in the Company.
The Controlling Group may from time to time and at any time, in their sole discretion, acquire or cause to be acquired, additional equity or other instruments of the Company, its subsidiaries or affiliates, or derivative instruments the value of which is linked to Company securities, or dispose or cause to be disposed, such equity or other securities or instruments, in any amount that the Controlling Group may determine in their sole discretion, through open market transactions, privately negotiated transactions or otherwise.
In the event the Mergers are not completed for any reason, the Controlling Group may from time to time and at any time, in their sole discretion, acquire or cause to be acquired, additional equity or other instruments of the Company, its subsidiaries or affiliates, or derivative instruments the value of which is linked to Company securities, or dispose or cause to be disposed, such equity or other securities or instruments, in any amount that the Controlling Group may determine in their sole discretion, through open market transactions, privately negotiated transactions or otherwise.
The availability of Marine Products’ common stock to the investing public may be limited to those shares not held by the executive officers, directors and their affiliates, which could negatively impact Marine Products’ stock trading prices and affect the ability of minority stockholders to sell their shares.
Prior to the completion of the Mergers, and in the event the Mergers are not completed for any reason, the availability of Marine Products’ common stock to the investing public may be limited to those shares not held by the executive officers, directors and their affiliates, which could negatively impact Marine Products’ stock trading prices and affect the ability of minority stockholders to sell their shares.
There is no assurance that we will be able to increase the prices of our products and preserve our profitability in the event of future inflation and cost increases. Marine Products may be Unable to Identify, Complete or Successfully Integrate Acquisitions.
There is no assurance that we will be able to increase the prices of our products and preserve our profitability in the event of future inflation and cost increases.
These provisions may make a tender offer, change in control or takeover attempt that is opposed by Marine Products’ Board of Directors more difficult or expensive.
In the event the Mergers are not completed for any reason, these provisions may make a tender offer, change in control or takeover attempt that is opposed by Marine Products’ Board of Directors more difficult or expensive.
Marine Products’ inability to attract new dealers and retain those dealers, or its inability to increase sales with existing dealers, could substantially impair its ability to execute its business plans.
Marine Products’ inability to attract new dealers and retain those dealers, or its inability to increase sales with existing dealers, could substantially impair its ability to execute its business plans. Marine Products’ Financial Condition and Operating Results may be Adversely Affected by Boat Dealer Defaults.
Many companies are receiving greater attention from stakeholders regarding their ESG practices, as well as their oversight of relevant ESG issues. The various stakeholders are placing growing importance on our potential environmental and social issue risk exposure and the impact of our choices. This trend appears likely to continue.
The various stakeholders are placing growing importance on our potential environmental and social issue risk exposure and the impact of our choices. This trend appears likely to continue.
This concentration of ownership could also have the effect of delaying or preventing a third-party from acquiring control of Marine Products at a premium. Our Executive Officers, Directors and Their Affiliates Together Have a Substantial Ownership Interest, and the Availability of Marine Products’ Common Stock to the Investing Public may be Limited.
Our Executive Officers, Directors and Their Affiliates Together Have a Substantial Ownership Interest, and the Availability of Marine Products’ Common Stock to the Investing Public may be Limited.
Marine Products’ Financial Condition and Operating Results may be Adversely Affected by Boat Dealer Defaults. The Company’s products are sold through independent dealers, and the financial health of these dealers is critical to the Company’s continued success.
The Company’s products are sold through independent dealers, and the financial health of these dealers is critical to the Company’s continued success.
Provisions in Marine Products’ Certificate of Incorporation and Bylaws may Inhibit a Takeover of Marine Products.
Provisions in Marine Products’ Certificate of Incorporation and Bylaws may Inhibit a Takeover of Marine Products. Marine Products’ certificate of incorporation, bylaws and other documents contain certain provisions including advance notice requirements for stockholder proposals and director nominations.
Future sales by executive officers, directors and their affiliates of all or a substantial portion of their shares could also negatively affect the trading price of Marine Products’ common stock. ​ Item 1B. Unresolved Staff Comments None. ​
Future sales by executive officers, directors and their affiliates of all or a substantial portion of their shares could also negatively affect the trading price of Marine Products’ common stock. ​ Risks Related to the Mergers The number of shares of MasterCraft common stock issuable in the First Merger in respect of one share of our common stock is fixed and will not be adjusted.
Marine Products’ executive officers, directors and their affiliates hold directly or through indirect beneficial ownership, in the aggregate, approximately 70% of Marine Products’ outstanding shares of common stock as of February 14, 2024. As a result, these stockholders effectively control the operations of Marine Products, including the election of directors and approval of significant corporate transactions such as acquisitions.
As a result, these stockholders effectively control the operations of Marine Products, including the election of directors and approval of significant corporate transactions such as acquisitions.
Rollins, each of whom is a director of the Company, and certain companies under their control (the “Controlling Group”), controls in excess of fifty percent of the Company’s voting power. As a “Controlled Corporation,” the Company need not comply with certain NYSE rules including those requiring a majority of independent directors and independent nominating and compensation committees.
Rollins, each of whom is a director of the Company, certain of their family members, and certain companies under their and/or their family members’ control, controls in excess of fifty percent of the Company’s voting power.
These risks could have a material adverse effect on our business, consolidated results of operations and consolidated financial condition. ​ General Risks Marine Products’ Stock Price Has Been Volatile. Historically, the market price of common stock of companies engaged in the discretionary consumer products industry has been highly volatile.
Compliance with such regulations could require changes to the software, systems, or data processes we use, and non-compliance—whether by us or a third-party vendor—could expose us to penalties or reputational harm. General Risks Marine Products’ Stock Price Has Been Volatile. Historically, the market price of common stock of companies engaged in the discretionary consumer products industry has been highly volatile.
Removed
Although Marine Products’ management believes that the quality of its products and services in the recreational boating market should permit it to maintain its relationship with its dealers and its market position, there can be no assurance that Marine Products will be able to sustain its current sales levels.
Added
In addition, changed priorities in terms of governmental interpretation of discrimination and other laws could result in enforcement actions or other litigation regarding the Company’s ESG practices.
Removed
Marine Products intends to pursue acquisitions and form strategic alliances that will enable Marine Products to acquire complementary skills and capabilities, offer new products, expand its customer base, and obtain other competitive advantages.
Added
As a “Controlled Corporation,” the Company need not comply with certain NYSE rules including those requiring a majority of independent directors and independent nominating and compensation committees. Marine Products’ executive officers, directors and their affiliates hold directly or through indirect beneficial ownership, in the aggregate, approximately 75% of Marine Products’ outstanding shares of common stock as of February 13, 2026.
Removed
There can be no assurance, however, that Marine Products will be able to successfully identify suitable acquisition candidates or strategic partners, obtain financing on satisfactory terms, complete acquisitions or strategic alliances, integrate acquired operations into its existing operations, or expand into new markets.
Added
In the event that the Mergers are not completed for any reason, this concentration of ownership could also have the effect of delaying or preventing a third-party from acquiring control of Marine Products at a premium.
Removed
Once integrated, acquired operations may not achieve anticipated levels of sales or 16 ​ profitability, or otherwise perform as expected.
Added
These risks could have a material adverse effect on our business, consolidated results of operations and consolidated financial condition. ​ ​ 19 ​ Risks Related to Artificial Intelligence Increased usage of Artificial Intelligence (AI) and machine learning technologies could expose us to operational, safety, cybersecurity, legal and reputational risks and could adversely affect our ability to compete, our operating results and our cash flows.
Removed
Acquisitions also involve special risks, including risks associated with unanticipated problems, liabilities and contingencies, diversion of management resources, and possible adverse effects on earnings and earnings per share resulting from increased interest costs, the issuance of additional securities, and difficulties related to the integration of the acquired business.
Added
We do not currently rely on AI for core elements of our boat design, engineering, production, or customer support processes. However, vendors, suppliers, dealers, and technology partners may incorporate AI into the products, services, or systems we use.
Removed
Marine Products’ certificate of incorporation, bylaws and other documents contain provisions including advance notice requirements for stockholder proposals and director nominations, and staggered terms of office for the Board of Directors, unless the shareholders approve the proposed Charter amendment to declassify the Board at the upcoming shareholders meeting.
Added
If these third- party AI tools malfunction, produce unreliable outputs, or are integrated without sufficient controls, our operations could experience disruptions, delays, cost increases, quality issues, or cybersecurity vulnerabilities. Competitors may deploy AI-enabled tools more quickly or effectively than we do, improving their cost structure, responsiveness and utilization and increasing competitive pressure.
Added
Future AI-related regulations could also affect us even if our internal use remains limited. Governments may enact rules governing automated decision-making, data usage, safety testing, workforce impacts, or transparency requirements applicable to manufacturers or their supply chains.
Added
Because the market price of MasterCraft common stock may fluctuate, our stockholders cannot be sure of the market value of the stock consideration they will receive in exchange for their shares in connection with the proposed transaction.
Added
At the time the First Merger is completed, each issued and outstanding share of our common stock will be converted into the right to receive the Merger Consideration, which is comprised of the Stock Consideration and Cash Consideration.
Added
The exchange ratio is fixed and will not be adjusted to reflect stock price changes of either our common stock or MasterCraft common stock prior to the closing of the First Merger.
Added
Accordingly, the market value of the Stock Consideration that our stockholders will receive in First Merger will vary based on the price of MasterCraft common stock at the time our stockholders receive the Merger Consideration, and our stockholders cannot be sure of the market value of the share component of the Merger Consideration they will receive upon completion of First Merger.
Added
The market price of MasterCraft common stock is expected to fluctuate from the date hereof through and after the date the Mergers are completed, which could occur a considerable amount of time after the date hereof.
Added
Changes in the price of MasterCraft common stock may result from a variety of factors, including general market and economic conditions, changes in MasterCraft’s and our businesses, operations and prospects, changes in market assessments of the likelihood that the Mergers will be completed and/or the value that may be generated by the Mergers, changes with respect to expectations regarding the timing of the Mergers and regulatory considerations.
Added
Many of these factors are beyond our and MasterCraft’s control.
Added
In addition, the use of cash by MasterCraft in connection with the financing of the Cash Consideration may have an adverse impact on MasterCraft’s liquidity, limit MasterCraft’s flexibility in responding to other business opportunities and increase MasterCraft’s vulnerability to averse economic and industry conditions, each of which could adversely affect the market price of MasterCraft’s common stock prior to closing and that of the combined company following closing.
Added
Failure to complete the Mergers, or a delay in the completion of the Mergers, could negatively impact our business, results of operations, financial condition, and stock price. The Merger Agreement is subject to a number of conditions that must be fulfilled to complete the Mergers.
Added
Those conditions include, but are not limited to: (i) the approval of the Merger Agreement by the affirmative vote of the holders of a majority in voting power of the outstanding Company common stock entitled to vote thereon, (ii) the approval of the issuance of shares of MasterCraft 20 ​ common stock to be issued in the First Merger by the affirmative vote of the holders of a majority in voting power of the outstanding MasterCraft common stock present in person or by proxy and entitled to vote thereon at a meeting of MasterCraft stockholders, (iii) the absence of any injunction or order by any court or other governmental entity restraining, enjoining, preventing or otherwise prohibiting the consummation of the Mergers, (iv) the shares of MasterCraft common stock to be issued in the First Merger being approved for listing on the Nasdaq, (v) the effectiveness of the registration statement on Form S-4 pursuant to which the shares of MasterCraft common stock to be issued in the First Merger will be registered with the SEC, (vi) the expiration or termination of the waiting period (and any extension thereof) required under the HSR Act, and (vii) the absence of a material adverse effect with respect to each of MasterCraft and the Company.
Added
A number of the conditions are not within our control, and may prevent, delay, or otherwise materially adversely affect the completion of the Mergers.
Added
We cannot predict with certainty whether and when any of the required closing conditions will be satisfied or if another uncertainty may arise and cannot assure you that we will be able to timely consummate the Mergers as currently contemplated under the Merger Agreement or at all.
Added
Our business, results of operations, financial condition, or stock price could be adversely affected, potentially in a material way, by the failure to complete the Mergers, or by a delay in the completion of the Mergers, and we may suffer consequences that could adversely affect our business, results of operations, financial condition, and stock price, including the following: ● we may not realize any or all of the potential benefits of the Mergers, including any synergies that could result from combining our financial and business resources with those of MasterCraft; ● we could be required to pay a termination fee of $11.6 million if the Merger Agreement is terminated in certain circumstances; ● matters relating to the Mergers will require substantial commitments of time and resources by our management which would otherwise have been devoted to day-to-day operations and other opportunities that may have been beneficial to us as an independent company; ● we have incurred and will incur further substantial expenses in connection with the Mergers, including legal, financial advisory, accounting, consulting and other advisory fees, severance/employee benefit-related costs, public company filing fees and other regulatory fees, and other costs relating to the Mergers regardless of whether the Mergers are consummated; ● we may be subject to legal proceedings related to the potential delay of, or failure to consummate, the Mergers; ● we may experience disruptions to our business resulting from the announcement and pendency of the Mergers, including adverse changes in our relationships with, or loss of, our customers, business partners and employees, which may not be reversible and may continue or even intensify in the event the Mergers are delayed or not consummated; ● under the Merger Agreement, we are subject to certain restrictions on the conduct of our business prior to completing the Mergers, which restrictions could adversely affect our ability to conduct our business as we otherwise would have done if we were not subject to these restrictions; ● we may experience negative reactions to the Mergers from the financial markets, including negative impacts on the market price of our common stock; and ● if the Mergers are not consummated, we may suffer from negative publicity and a negative impression of us in the investment community and a failure to close the Mergers may have a negative impact on the market price of our common stock.
Added
Uncertainties associated with the Mergers may cause a loss of key employees at either of the Company or MasterCraft, which could adversely affect the future business and operations of the combined company following the Mergers. We depend on the experience and industry knowledge of our key employees to execute our business plans.
Added
The success of the combined company after the Mergers will depend in part on its ability to retain or attract key employees.
Added
During the pendency or following the completion of the Mergers, our current and prospective employees may experience uncertainty or have concerns regarding their roles within the combined company, the timing and completion of the Mergers or the operations of the combined company, any of which may have an adverse effect on our ability to retain or attract key personnel.
Added
If we are unable to retain key personnel, we or the combined company could face disruptions in our operations, loss of existing customers, loss of key information, expertise or know-how and unanticipated additional recruitment and training costs. In addition, the loss of key personnel could diminish the anticipated benefits of the Mergers.
Added
No assurance can be given that the combined company, following the Mergers, will be able to retain or attract key employees of the Company to the same extent that the Company has previously been able to retain or attract its own employees. 21 ​ Current holders of our common stock will have a significantly reduced ownership and voting interest in the combined company after the Mergers and will therefore have less voting influence over the combined company.
Added
As a result of the Mergers, each of our stockholders will become a holder of common stock of the combined company. Upon completion of the Mergers, current Company stockholders are expected to own approximately 33.5% and current MasterCraft stockholders are expected to own approximately 66.5% of the combined company on a fully diluted basis.
Added
As a result, the Company’s current stockholders will have less voting influence on the combined company and may have less influence on its management and policies than they now have over the Company. Litigation against us or MasterCraft, or the members of our or MasterCraft’s board of directors, could prevent or delay the completion of the Mergers.
Added
Our stockholders or MasterCraft’s stockholders have and may continue to file lawsuits against us, MasterCraft, and/or the board of directors of either company in connection with the Mergers. These legal proceedings could delay or prevent the Mergers from being completed in a timely manner.
Added
The existence of litigation related to the Mergers could affect the likelihood of obtaining the required regulatory and stockholder approvals. Moreover, any litigation could be time-consuming and expensive and could divert our and MasterCraft’s management’s attention away from their regular business and their focus on successful integration planning for the two companies.
Added
Any lawsuit adversely resolved against us, MasterCraft or members of our respective boards of directors could have a material adverse effect on each company’s business, financial condition and results of operations. The Merger Agreement limits our ability to pursue alternatives to the Mergers and may discourage other companies from trying to acquire us.
Added
The Merger Agreement contains “no shop” covenants that restrict our ability to, directly or indirectly, among other things, solicit alternative acquisition proposals, to furnish information to, and to participate in discussions or negotiations with, third parties regarding any alternative acquisition proposals, subject to a customary “fiduciary out” provision.
Added
These provisions, which include a $11.6 million termination fee payable under certain circumstances, may discourage a potential third-party acquirer that might have an interest in acquiring all or a significant part of the Company from considering or making such an acquisition proposal.
Added
The need for regulatory approvals may delay the date of completion of the Mergers or may diminish the benefits of the Mergers. The parties to the Merger Agreement are required to obtain the approvals of certain regulatory agencies before completing the Mergers. Satisfying any requirements of these regulatory agencies may delay the date of completion of the Mergers.
Added
The requisite regulatory approvals may not be received on a timely basis, or at all (in which case the Mergers could not be completed), or may contain conditions or restrictions on completion of the Mergers that cannot be satisfied.
Added
In addition, any conditions or restrictions imposed could have the effect of imposing additional costs on or limiting the revenues of the combined company following the Mergers, which might have an adverse effect on the combined company following the Mergers.
Added
Further, it is possible that, among other things, restrictions on the combined operations of the two companies, including divestitures, may be sought by governmental agencies as a condition to obtaining the required regulatory approvals. This may diminish the benefits of the Mergers to the combined company or otherwise have an adverse effect on the combined company following the Mergers.
Added
If the Mergers are consummated, the combined company may not perform as we or the market expects and may fail to realize the projected benefits and cost savings of the Mergers, which could adversely affect the value of MasterCraft common stock, which our current stockholders will own following the completion of the Mergers.
Added
The success of the Mergers will depend, in part, on MasterCraft’s ability to realize the anticipated benefits and cost savings from combining our and MasterCraft’s respective businesses, including operational and other synergies that we believe the combined company will be able to achieve.
Added
The anticipated benefits and cost savings of the Mergers may not be realized fully or at all, may take longer to realize than expected or could have other adverse effects that we do not currently foresee.
Added
Risks associated with the combined company following the Mergers include: ● the integration process will require significant time and focus from management following the Mergers and may, for the combined company, result in the loss of key employees, the disruption of ongoing businesses or inconsistencies in standards, controls, procedures, and policies; 22 ​ ● it is possible that key employees might decide not to remain with the combined company after the Mergers are completed, and the loss of key personnel could have a material adverse effect on the resulting entity’s results of operations, financial condition, and growth prospects; ● the results of operations of the combined company and the market price of the combined company’s common stock after the completion of the Mergers may be affected by factors different from those currently affecting the independent results of operations of each of the Company and MasterCraft; ● there could be potential unknown liabilities and unforeseen expenses associated with the Mergers that were not discovered in the course of performing due diligence; and ● the issuance of shares of the MasterCraft common stock in the Mergers could depress the market price for the combined company’s common stock.
Added
If the Mergers were to fail to qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”), the Company’s stockholders may be required to pay additional U.S. federal income taxes.
Added
The Mergers are intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and the Company and MasterCraft intend to report the Mergers consistent with such qualification.
Added
However, the closing is not conditioned upon the receipt of an opinion of counsel or a ruling from the Internal Revenue Service (“IRS”) that the Mergers will so qualify, and neither MasterCraft nor the Company intends to request a ruling from the IRS regarding the U.S. federal income tax consequences of the Mergers.
Added
Consequently, no assurance can be given that the Mergers will so qualify, that the IRS will not challenge such qualification, or that a court would not sustain such a challenge.
Added
If the Mergers were to fail to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, a holder of the Company’s common stock generally would recognize gain or loss for U.S. federal income tax purposes upon the exchange of the Company’s common stock for MasterCraft common stock in the Mergers.
Added
This would be in addition to income with respect to the Cash Consideration, which generally would constitute taxable income to a holder of the Company’s common stock in an amount equal to the lesser of the amount of such cash and the holder’s realized gain in its MasterCraft common stock if the Mergers qualified as a “reorganization” within the meaning of Section 368(a) of the Code. ​ Item 1B.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeTo help guide its overall program, the Company uses the Center for Internet Security (“CIS”) Controls framework to provide best practices for securing IT systems and data. We have implemented a majority of version 8.0 of the CIS Controls which supports a Zero Trust architecture. The Company has several security policies that are published and accessible to all employees.
Biggest changeTo help guide its overall program, Marine Products has adopted the Center for Internet Security (“CIS”) framework, which provides prioritized guidance to help defend systems and networks against the most prevalent cyber-attacks as well as support a Zero Trust architecture. The Company has several security policies that are published and accessible to all employees.
Cyber liability insurance also provides coverage in the event of a ransomware attack. Our cyber risk coverage includes assistance in the timely remediation of material cyberattacks and incidents.
Cyber liability insurance also provides 23 ​ coverage in the event of a ransomware attack. Our cyber risk coverage includes assistance in the timely remediation of material cyberattacks and incidents.
In addition, the Audit Committee receives reports summarizing threat detection and mitigation plans, audits of internal controls, training and certification, and other cyber priorities and initiatives, as well as timely updates from senior leaders on material incidents relating to information systems security, including cybersecurity incidents.
In addition, the Audit Committee receives reports summarizing threat detection and mitigation plans, audits of internal controls, training and certification, and other cyber priorities and initiatives, as well as timely updates from senior leaders on material incidents relating to information systems security, including cybersecurity incidents. The Audit Committee includes members with experience in risk management including cybersecurity.
The Committee meets periodically to discuss cybersecurity program updates and challenges, watch for potential threats from both external and internal sources, monitor compliance in existing or emerging business practices, and respond to stakeholder inquiries.
Role of Management Company management has established a Cybersecurity Governance Committee that is comprised of the Information Technology Manager and senior members of management. The Committee meets periodically to discuss cybersecurity program updates and challenges, watch for potential threats from both external and internal sources, monitor compliance in existing or emerging business practices, and respond to stakeholder inquiries.
Removed
The Audit Committee includes members with experience in risk management including cybersecurity. 20 ​ Role of Management Company management has established a Cybersecurity Governance Committee that is comprised of the Information Technology Manager and senior members of management.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeChaparral owns and maintains approximately 1,284,000 square feet of space utilized for manufacturing, research and development, warehouse, sales office and operations in Nashville, Georgia. In addition, the Company owns 83,000 square feet of manufacturing space in Valdosta, Georgia.
Biggest changeIf the Mergers are completed, this arrangement will be terminated prior to or as of the closing date. Chaparral owns and maintains approximately 1,285,200 square feet of space utilized for manufacturing, research and development, warehouse, sales office and operations in Nashville, Georgia. In addition, the Company owns 83,000 square feet of manufacturing space in Valdosta, Georgia.
Item 2. Properties Marine Products’ corporate offices are in Atlanta, Georgia. These offices are currently shared with RPC and are leased. The monthly rent paid is allocated between Marine Products and RPC. Under this arrangement, Marine Products pays approximately $4,500 per month in rent. Marine Products may cancel this arrangement at any time after giving a 30-day notice.
Item 2. Properties Marine Products’ corporate offices are in Atlanta, Georgia. These offices are currently shared with RPC and are leased. The monthly rent paid is allocated between Marine Products and RPC. Under this arrangement, Marine Products pays approximately $4,600 per month in rent. Marine Products may cancel this arrangement at any time after giving a 30-day notice.
Marine Products’ total square footage under roof is allocated as follows: manufacturing — 729,400, research and development — 68,500, warehousing — 446,900, office and other — 122,200. ​
Marine Products’ total square footage under roof is allocated as follows: manufacturing — 729,900, research and development — 68,500, warehousing — 446,900, office and other — 122,900. ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings Marine Products is involved in litigation from time to time in the ordinary course of its business. Marine Products does not believe that the ultimate outcome of such litigation will have a material adverse effect on its liquidity, financial condition or results of operations. ​ Item 4. Mine Safety Disclosures Not applicable. ​ PART II
Biggest changeIf plaintiffs are successful in obtaining an injunction prohibiting the parties from 24 ​ completing the Mergers on the agreed-upon terms, such an injunction may delay the completion of the Mergers or may prevent the Mergers from being completed altogether. ​ Except as noted above, Marine Products does not believe that the ultimate outcome of such litigation will have a material adverse effect on its liquidity, financial condition or results of operations. ​ Item 4.
Added
Item 3. Legal Proceedings Marine Products is involved in litigation from time to time in the ordinary course of its business. ​ In addition, stockholders have filed and may continue to file lawsuits challenging the Mergers, which may name us, MasterCraft, members of our Board, members of the MasterCraft board, or others as defendants.
Added
No assurance can be made as to the outcome of such lawsuits, including the amount of costs associated with defending claims or any other liabilities that may be incurred in connection with the litigation of any claims.
Added
Mine Safety Disclosures Not applicable. ​ PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe graph below assumes the value of $100.00 invested on December 31, 2019. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, Company/Index ​ 2019 ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Marine Products Corporation Common Stock ​ 100 ​ 104 ​ 92 ​ 91 ​ 92 ​ 83 Peer Group ​ 100 ​ 138 ​ 183 ​ 132 ​ 168 ​ 117 Russell 2000 Index ​ 100 ​ 120 ​ 138 ​ 110 ​ 128 ​ 143 ​ ​ Item 6.
Biggest changeThe Russell 2000 is used because the Company is a component of the Russell 2000, and because the Russell 2000 is a stock index representing small capitalization U.S. stocks. 25 ​ The graph below assumes the value of $100.00 invested on December 31, 2020. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, Company/Index ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 ​ 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Marine Products Corporation Common Stock ​ 100 ​ 89 ​ 87 ​ 88 ​ 80 ​ 81 Russell 2000 Index ​ 100 ​ 115 ​ 91 ​ 107 ​ 119 ​ 134 Peer Group ​ 100 ​ 132 ​ 95 ​ 122 ​ 85 ​ 91 ​ ​ Item 6.
The indices included in the following graph are the Russell 2000 Index (“Russell 2000”) and a peer group which includes companies that are considered peers of the Company (“Peer Group”). The companies included in the Peer Group have been weighted 21 ​ according to each respective issuer’s stock market capitalization at the end of each year.
The indices included in the following graph are the Russell 2000 Index (“Russell 2000”) and a peer group which includes companies that are considered peers of the Company (“Peer Group”). The companies included in the Peer Group have been weighted according to each respective issuer’s stock market capitalization at the end of each year.
The companies in the Peer Group are Brunswick Corporation, MarineMax, Inc., Malibu Boats, Inc. and Mastercraft Boat Holdings, Inc. The Company was a component of the Russell 2000 during 2024. The Russell 2000 is a stock index measuring the performance of the small-cap segment of the US equity universe.
The companies in the Peer Group are Brunswick Corporation, MarineMax, Inc., Malibu Boats, Inc. and MasterCraft Boat Holdings, Inc. The Company was a component of the Russell 2000 during 2025. The Russell 2000 is a stock index measuring the performance of the small-cap segment of the US equity universe.
There are 1,570,428 shares that remain available for repurchase as of December 31, 2024. The program does not have a predetermined expiration date.
The Company did not repurchase any shares under this program in 2025 and 2024. There are 1,570,428 shares that remain available for repurchase as of December 31, 2025. The program does not have a predetermined expiration date.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Marine Products’ common stock is listed for trading on the New York Stock Exchange under the symbol “MPX.” As of February 14, 2025, there were 34,961,460 shares of common stock outstanding and approximately 7,800 beneficial holders of our Company’s common stock.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Marine Products’ common stock is listed for trading on the New York Stock Exchange under the symbol “MPX.” As of February 13, 2026, there were 35,242,624 shares of common stock outstanding and approximately 383 record holders of our Company’s common stock per our transfer agent.
Issuer Purchases of Equity Securities The Company has a stock buyback program initially adopted in 2001 and subsequently amended in 2013 and 2019 that authorized the repurchase of 8,250,000 shares, in the aggregate, in the open market. The Company did not repurchase any shares under this program in 2024 and 2023.
The number of record holders of our common stock does not include Depository Trust Company participants or beneficial owners holding shares through nominee names. ​ Issuer Purchases of Equity Securities The Company has a stock buyback program initially adopted in 2001 and subsequently amended in 2013 and 2019 that authorized the repurchase of 8,250,000 shares, in the aggregate, in the open market.
The components of the index had a weighted average market capitalization in 2024 of $3.6 billion, and a median market capitalization of $987 million. The Russell 2000 is used because the Company is a component of the Russell 2000, and because the Russell 2000 is a stock index representing small capitalization U.S. stocks.
The components of the index had a weighted average market capitalization in 2025 of $4.6 billion, and a median market capitalization of $987 million.
Added
Pursuant to the Merger Agreement, the Company has agreed not to repurchase any shares of its common stock without MasterCraft’s permission during the time period between the execution of the Merger Agreement and the completion of the Mergers.

Item 7. Management's Discussion & Analysis

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

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Biggest changeThese measures should not be considered in isolation or as a substitute for performance or liquidity measures prepared in accordance with GAAP. ​ A non-GAAP financial measure is a numerical measure of financial performance, financial position or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. ​ The following are reconciliations of these non-GAAP measures with their most directly comparable GAAP measures. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Unaudited) ​ Years ended December 31, (in thousands) 2024 2023 2022 Reconciliation of Net Income to EBITDA ​ ​ ​ ​ Net income ​ $ 17,853 ​ $ 41,695 ​ $ 40,347 ​ Adjustments: ​ ​ ​ ​ ​ Add: Income tax provision ​ 3,289 ​ 10,367 ​ 11,787 ​ Add: Depreciation and amortization ​ ​ 2,786 ​ ​ 2,416 ​ ​ 1,905 ​ Less: Interest income, net ​ 2,876 ​ 2,860 ​ 338 ​ EBITDA ​ $ 21,052 ​ $ 51,618 ​ $ 53,701 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ $ 236,555 ​ $ 383,729 ​ $ 380,995 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income margin (1) ​ ​ 7.5 % ​ 10.9 % ​ 10.6 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ EBITDA margin (1) ​ ​ 8.9 % ​ 13.5 % ​ 14.1 % (1) Net income margin is calculated as net income divided by net sales.
Biggest changeThese measures should not be considered in isolation or as a substitute for performance or liquidity measures prepared in accordance with GAAP. ​ A non-GAAP financial measure is a numerical measure of financial performance, financial position or cash flows that either 1) excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of operations, balance sheet or statement of cash flows, or 2) includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. ​ The following are reconciliations of these non-GAAP measures with their most directly comparable GAAP measures. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Unaudited) ​ ​ Years ended December 31, ​ (in thousands) ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 ​ Reconciliation of Net Income to EBITDA ​ ​ ​ ​ ​ ​ ​ ​ Net income ​ ​ $ 11,383 ​ $ 17,853 ​ $ 41,695 ​ Adjustments: ​ ​ ​ ​ ​ ​ ​ ​ Add: Income tax provision ​ ​ 4,382 ​ 3,289 ​ 10,367 ​ Add: Depreciation and amortization ​ ​ ​ 3,138 ​ ​ 2,786 ​ ​ 2,416 ​ Less: Interest income, net ​ ​ 1,737 ​ 2,876 ​ 2,860 ​ EBITDA ​ ​ $ 17,166 ​ $ 21,052 ​ $ 51,618 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net sales ​ ​ $ 244,419 ​ $ 236,555 ​ $ 383,729 ​ Net income margin (1) ​ ​ ​ 4.7 % ​ 7.5 % ​ 10.9 % EBITDA margin (1) ​ ​ ​ 7.0 % ​ 8.9 % ​ 13.5 % (1) Net income margin is calculated as net income divided by net sales.
The Company currently has an agreement with one of the floor plan lenders whereby the contractual repurchase limit is based on the highest of the following criteria: (i) a specified percentage of the amount of the average net receivables financed by the floor plan lender for our dealers, (ii) the total average net receivables financed by the floor plan lender for our two highest dealers for the three highest monthly receivables balances during the past twelve months, or (iii) $8.0 million, less repurchases during the prior 12 month period.
The Company currently has an agreement with one of the floor plan lenders whereby the contractual repurchase limit is based on the highest of the following criteria: (i) a specified percentage of the average net receivables financed by the floor plan lender for our dealers, (ii) the total average net receivables financed by the floor plan lender for our two highest dealers for the three highest monthly receivables balances during the past twelve months, or (iii) $8.0 million, less repurchases during the prior 12 month period.
The facility includes (i) a $5 million sublimit for swingline loans, (ii) a $2.5 million aggregate sublimit for all letters of credit, and (iii) a committed accordion which can increase the aggregate commitments by the greater of $35 million and adjusted EBITDA (as calculated under the Credit Agreement) over the most recently completed twelve-month period.
The facility includes (i) a $5.0 million sublimit for swingline loans, (ii) a $2.5 million aggregate sublimit for all letters of credit, and (iii) a committed accordion which can increase the aggregate commitments by the greater of $35 million and adjusted EBITDA (as calculated under the Credit Agreement) over the most recently completed twelve-month period.
In addition, the Company offers at various times other time-specific or model-specific incentives. 28 ​ The factors that complicate estimating the cost of incentives are the ability to estimate incentive payments of the Company, the volume and timing of inventory financed by specific dealers, and the notification of boats sold subject to certain incentives.
In addition, the Company offers at various times other time-specific or model-specific incentives. The factors that complicate estimating the cost of incentives are the ability to estimate incentive payments of the Company, the volume and timing of inventory financed by specific dealers, and the notification of boats sold subject to certain incentives.
The agreements provide for the return of repossessed boats to the Company in new and unused condition, subject to normal wear and tear, in exchange for the Company’s assumption of the debt obligation on those boats, as contractually defined by each lender. The Company had no material repurchases of dealer inventory under contractual agreements during 2024 and 2023.
The agreements provide for the return of repossessed boats to the Company in new and unused condition, subject to normal wear and tear, in exchange for the Company’s assumption of the debt obligation on those boats, as contractually defined by each lender. The Company had no material repurchases of dealer inventory under contractual agreements during 2025 and 2024.
The Company believes that the liquidity provided by existing cash, cash equivalents, its overall strong capitalization and cash generated by operations will be sufficient to meet the Company’s requirements for at least the next twelve months.
Financial Condition and Liquidity The Company believes that the liquidity provided by existing cash, cash equivalents, its overall strong capitalization and cash generated by operations will be sufficient to meet the Company’s requirements for at least the next twelve months.
As of December 31, 2024, the Company believes the fair value of its guarantee liability is immaterial. See further information regarding repurchase obligations in the note titled Commitments and Contingencies in the Notes of the Consolidated Financial Statements.
As of December 31, 2025, the Company believes the fair value of its guarantee liability is immaterial. See further information regarding repurchase obligations in the note titled Commitments and Contingencies in the Notes of the Consolidated Financial Statements.
These arrangements are subject to maximum repurchase amounts and the associated risk is mitigated by the value of the boats repurchased. The Company had no material repurchases of dealer inventory in 2024 and 2023.
These arrangements are subject to maximum repurchase amounts and the associated risk is mitigated by the value of the boats repurchased. The Company had no material repurchases of dealer inventory in 2025 and 2024.
Warranty expense as a percentage of net sales was 1.5% in 2024, 1.5% in 2023 and 1.5% in 2022. A 0.10 percentage point increase in the estimated warranty expense as a percentage of net sales during 2024 would have increased selling, general and administrative expenses and reduced operating income by approximately $0.2 million.
Warranty expense as a percentage of net sales was 1.9% in 2025, 1.5% in 2024, and 1.5% in 2023. A 0.10 percentage point increase in the estimated warranty expense as a percentage of net sales during 2025 would have increased selling, general and administrative expenses and reduced operating income by approximately $0.2 million.
Settlement of the incentives generally occurs from three to twelve months after the sale. The Company regularly analyzes the historical incentive trends and adjusts recorded liabilities for changes in trends and terms of incentive programs. Total cost of incentives recorded in net sales as a percentage of gross sales was 9.2% in 2024, 7.3% in 2023, and 5.6% in 2022.
Settlement of the incentives generally occurs from three to twelve months after the sale. The Company regularly analyzes the historical incentive trends and adjusts recorded liabilities for changes in trends and terms of incentive programs. Total cost of incentives recorded in net sales as a percentage of gross sales was 9.1% in 2025, 9.2% in 2024 and 7.3% in 2023.
Subject to industry conditions and Marine 26 ​ Products’ earnings, financial condition, and other relevant factors, the Company expects to continue to pay regular quarterly cash dividends to common stockholders.
Subject to industry conditions and Marine Products’ earnings, financial condition, and other relevant factors, the Company expects to continue to pay regular quarterly cash dividends to common stockholders until closing of the Mergers.
The Company provides warranties against manufacturing defects for various components of the boats, primarily the fiberglass deck and hull, with warranty periods extending up to a lifetime. Warranty costs, if any, on other components of the boats are generally absorbed by the original component manufacturer.
The Company evaluates its warranty obligation for each product line on a model year basis. The Company provides warranties against manufacturing defects for various components of the boats, primarily the fiberglass deck and hull, with warranty periods extending up to a lifetime. Warranty costs, if any, on other components of the boats are generally absorbed by the original component manufacturer.
Similarly, free cash flow should be considered in addition to, rather than as a substitute for, GAAP presentation of net cash provided by operating, investing and financing activities, as a measure of our liquidity. ​ See section titled Non-GAAP Financial Measures for a reconciliation of EBITDA to net income and EBITDA margin to net income margin, the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of Free Cash Flow to Operating Cash Flow, the most directly comparable financial measure calculated and presented in accordance with GAAP. 23 ​ Results of Operations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended December 31, (in thousands, except per share and number of boats sold) ​ 2024 ​ 2023 ​ 2022 ​ Net sales ​ $ 236,555 ​ $ 383,729 ​ $ 380,995 ​ Cost of goods sold ​ ​ 191,057 ​ ​ 293,350 ​ ​ 287,278 ​ Selling, general and administrative expenses ​ ​ 27,376 ​ ​ 43,213 ​ ​ 41,921 ​ Gain on disposition of assets, net ​ ​ (144) ​ ​ (2,036) ​ ​ — ​ Interest income, net ​ ​ 2,876 ​ ​ 2,860 ​ ​ 338 ​ Income tax provision ​ ​ 3,289 ​ ​ 10,367 ​ ​ 11,787 ​ Net income ​ $ 17,853 ​ $ 41,695 ​ $ 40,347 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income margin ​ ​ 7.5 % ​ 10.9 % ​ 10.6 % Earnings per share ​ $ 0.50 ​ $ 1.21 ​ $ 1.18 ​ Cash flow from operating activities ​ $ 29,526 ​ $ 56,846 ​ $ 49,348 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total number of boats sold ​ 2,492 ​ 4,139 ​ 4,331 ​ Average gross selling price per boat ​ $ 85.7 ​ $ 82.4 ​ $ 76.8 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-GAAP financial measures: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ EBITDA ​ $ 21,052 ​ $ 51,618 ​ $ 53,701 ​ EBITDA margin ​ ​ 8.9 % ​ 13.5 % ​ 14.1 % Free cash flow ​ $ 24,930 ​ $ 46,672 ​ $ 46,848 ​ ​ Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Net Sales.
Similarly, free cash flow should be considered in addition to, rather than as a substitute for, GAAP presentation of net cash provided by operating, investing and financing activities, as a measure of our liquidity. ​ See section titled Non-GAAP Financial Measures for a reconciliation of EBITDA to net income and EBITDA margin to net income margin, the most directly comparable financial measures calculated and presented in accordance with GAAP and a reconciliation of Free Cash Flow to Operating Cash Flow, the most directly comparable financial measure calculated and presented in accordance with GAAP. 27 ​ Results of Operations ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended December 31, (in thousands, except per share and number of boats sold) ​ 2025 ​ 2024 ​ 2023 ​ Net sales ​ $ 244,419 ​ $ 236,555 ​ $ 383,729 ​ Cost of goods sold ​ ​ 197,644 ​ ​ 191,057 ​ ​ 293,350 ​ Selling, general and administrative expenses ​ ​ 32,747 ​ ​ 27,376 ​ ​ 43,213 ​ Gain on disposition of assets, net ​ ​ — ​ ​ (144) ​ ​ (2,036) ​ Interest income, net ​ ​ 1,737 ​ ​ 2,876 ​ ​ 2,860 ​ Income tax provision ​ ​ 4,382 ​ ​ 3,289 ​ ​ 10,367 ​ Net income ​ $ 11,383 ​ $ 17,853 ​ $ 41,695 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income margin ​ ​ 4.7 % ​ 7.5 % ​ 10.9 % Earnings per share ​ $ 0.32 ​ $ 0.50 ​ $ 1.21 ​ Net cash provided by operating activities ​ $ 16,464 ​ $ 29,526 ​ $ 56,846 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total number of boats sold ​ 2,354 ​ 2,492 ​ 4,139 ​ Average gross selling price per boat ​ $ 93.6 ​ $ 85.7 ​ $ 82.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-GAAP financial measures: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ EBITDA ​ $ 17,166 ​ $ 21,052 ​ $ 51,618 ​ EBITDA margin ​ ​ 7.0 % ​ 8.9 % ​ 13.5 % Free cash flow ​ $ 14,923 ​ $ 24,930 ​ $ 46,672 ​ ​ Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Net Sales.
For additional information with respect to MPC’s contractual obligations , see notes titled Notes Payable to Banks, Commitments and Contingencies, and Leases in the Notes to the Consolidated Financial Statements .
For additional information with respect to MPC’s contractual obligations , see notes titled Notes Payable to Banks, Commitments and Contingencies, and Leases in the Notes to the Consolidated Financial Statements . In addition, as described under “Item 1.
Net cash provided by operating activities and Free cash flow decreased in 2024 primarily due to lower net income partially offset by favorable working capital changes. Free cash flow was also positively impacted by a decrease in capital expenditures in 2024 compared to the prior year.
Net cash provided by operating activities and Free cash flow decreased in 2025 primarily due to lower net income coupled with unfavorable working capital changes. Free cash flow was also positively impacted by a decrease in capital expenditures in 2025 compared to the prior year.
EBITDA margin is calculated as EBITDA divided by net sales. 25 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Unaudited) ​ Years ended December 31, (in thousands) 2024 ​ 2023 2022 Reconciliation of Operating Cash Flow to Free Cash Flow ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ $ 29,526 ​ $ 56,846 ​ $ 49,348 ​ Capital expenditures ​ ​ (4,596) ​ ​ (10,174) ​ ​ (2,500) ​ Free cash flow ​ $ 24,930 ​ $ 46,672 ​ $ 46,848 ​ Liquidity and Capital Resources Cash and Cash Flows The Company’s cash and cash equivalents were $52.4 million at December 31, 2024, $72.0 million at December 31, 2023 and $43.2 million at December 31, 2022.
EBITDA margin is calculated as EBITDA divided by net sales. ​ 29 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Unaudited) ​ ​ Years ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (in thousands) ​ ​ ​ ​ 2025 ​ 2024 ​ ​ ​ 2023 Reconciliation of Operating Cash Flow to Free Cash Flow ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ​ ​ $ 16,464 ​ $ 29,526 ​ $ 56,846 Capital expenditures ​ ​ ​ (1,541) ​ ​ (4,596) ​ ​ (10,174) Free cash flow ​ ​ $ 14,923 ​ $ 24,930 ​ $ 46,672 Liquidity and Capital Resources Cash and Cash Flows The Company’s cash and cash equivalents were $43.5 million at December 31, 2025, $52.4 million at December 31, 2024 and $72.0 million at December 31, 2023.
Assets and liabilities that are valued using significant observable inputs in addition to quoted market prices are classified as Level 2. The Company currently has no assets or liabilities measured on a recurring basis that are valued using unobservable inputs and therefore no assets or liabilities measured on a recurring basis are classified as Level 3.
The Company currently has no assets or liabilities measured on a recurring basis that are valued using unobservable inputs and therefore no assets or liabilities measured on a recurring basis are classified as Level 3.
Marine Products’ net sales decreased by $147.2 million, or 38.4% ,to $236.6 million in 2024 compared to $383.7 million in 2023. The change in net sales in 2024 compared to the prior year was primarily due to a 40% decrease in unit sales volume partially offset by a positive price/mix change of 2%.
Marine Products’ net sales increased by $7.9 million, or 3.3% to $244.4 million in 2025 compared to $236.6 million in 2024. The change in net sales in 2025 compared to the prior year was primarily due to a positive price/mix change of 9%, partially offset by a 6% decrease in unit sales volume.
Net income decreased to $17.9 million in 2024, or $0.50 diluted earnings per share, from net income of $41.7 million in 2023, or $1.21 diluted earnings per share. Net income margin was 7.5% in 2024 compared to 10.9% in 2023.
Net income decreased to $11.4 million in 2025, or $0.32 diluted earnings per share, from net income of $17.9 million in 2024, or $0.50 diluted earnings per share. Net income margin was 4.7% in 2025 compared to 7.5% in 2024.
Critical Accounting Estimates The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require significant judgment by management in selecting the appropriate assumptions for calculating accounting estimates.
Related Party Transactions See the note titled Related Party Transactions in the Notes to the Consolidated Financial Statements for a description of certain related party transactions. 32 ​ Critical Accounting Estimates The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, which require significant judgment by management in selecting the appropriate assumptions for calculating accounting estimates.
Contractual Obligations The Company’s obligations and commitments that require future payments include our credit facility, certain non-cancelable operating leases, amounts related to the usage of corporate aircraft and other long-term liabilities.
See further information regarding repurchase obligations in the note titled Commitments and Contingencies in the Notes to the Consolidated Financial Statements. ​ Contractual Obligations The Company’s obligations and commitments that require future payments include our credit facility, certain non-cancelable operating leases, amounts related to the usage of corporate aircraft, and other long-term liabilities.
Interest Income, net. Interest income, net was unchanged at $2.9 million in both 2024 and 2023. Marine Products generated interest income from investments of excess cash in money market funds. Additionally, interest expense is recorded for the revolving credit facility, primarily related to fees on the unused portion of the facility. 24 ​ Income Tax Provision.
Interest income, net decreased to $1.7 million in 2025 from $2.9 million in 2024 due to lower cash balances and lower interest rates. Marine Products generated interest income from investments of excess cash in money market funds. Additionally, interest expense is recorded for the revolving credit facility, primarily related to fees on the unused portion of the facility.
The revolving credit facility includes a full and unconditional guarantee by the Company and its consolidated domestic subsidiaries and is subject to certain financial and other customary covenants. As of December 31, 2024, the Company had no outstanding borrowings under the revolving credit agreement.
The revolving credit facility includes a full and unconditional guarantee by the Company and its consolidated domestic subsidiaries and is subject to certain financial and other customary covenants.
The following table sets forth the historical cash flows for the twelve months ended December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended December 31, (in thousands) 2024 2023 2022 Net cash provided by operating activities ​ $ 29,526 ​ $ 56,846 ​ $ 49,348 Net cash used for investing activities ​ (4,433) ​ (7,871) ​ (2,500) Net cash used for financing activities ​ (44,666) ​ (20,194) ​ (17,779) ​ Cash provided by operating activities in 2024 decreased by $27.3 million compared to 2023, primarily due to the decrease in net income.
The following table sets forth the historical cash flows for the twelve months ended December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years ended December 31, (in thousands) ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ 2023 Net cash provided by operating activities ​ $ 16,464 ​ $ 29,526 ​ $ 56,846 Net cash used for investing activities ​ (4,681) ​ (4,433) ​ (7,871) Net cash used for financing activities ​ (20,650) ​ (44,666) ​ (20,194) ​ Cash provided by operating activities in 2025 decreased by $13.1 million compared to 2024, primarily due to the decrease in net income coupled with net unfavorable working capital adjustments.
Management believes sales comparisons to the prior year could begin to turn positive in the second half of 2025. How We Evaluate our Operations ​ We use Earnings per share, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), EBITDA margin and Free cash flow, non-GAAP financial measures, to evaluate and analyze the Company’s operating performance.
How We Evaluate our Operations ​ We use Earnings per share, Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA), EBITDA margin and Free cash flow, non-GAAP financial measures, to evaluate and analyze the Company’s operating performance.
Discussions of 2023 items and year-to-year comparisons of 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, which Item is incorporated herein by reference. 22 ​ Overview Consolidated net sales decreased 38.4% to $236.6 million in 2024 due primarily to a 40% decrease in unit sales to dealers partially offset by a positive price/mix of 2%.
Discussions of 2024 items and year-to-year comparisons of 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024, which Item is incorporated herein by reference.
Accordingly, the aggregate repurchase obligation with all financing institutions was approximately $25.0 million as of December 31, 2024. Although the Company has these agreements with financial institutions, in certain situations, the Company may decide for business reasons to repurchase boats in excess of these contractual amounts.
Although the Company has these agreements with financial institutions, in certain situations, the Company may decide for business reasons to repurchase boats in excess of these contractual amounts.
Our financial results during 2025 will depend on a number of factors, including economic trends, demand for discretionary products, the impact of interest rates on consumer financing options and dealer inventory carrying costs, the effectiveness of the Company’s incentive programs, the success of new model launches, and the Company’s ability to manage manufacturing costs in light of reduced production levels.
We have adjusted production levels to more closely align with expected demand; however, dealers remain cautious with their field inventory levels due to lower retail demand compared to recent years and higher financing costs. ​ Our financial results generally depend on a number of factors, including economic trends, demand for discretionary products, the impact of interest rates on consumer financing options and dealer inventory carrying costs, the effectiveness of the Company’s incentive programs, the success of new model launches, and the Company’s ability to manage manufacturing costs.
As defined by the agreement, the repurchase limit for this lender was $19.6 million as of December 31, 2024. The Company has contractual repurchase agreements with additional lenders with an aggregate maximum repurchase obligation of $5.4 million, with various expiration and cancellation terms of less than one year.
Lastly, the Company has contractual repurchase agreements with other lenders with an aggregate maximum repurchase obligation of $1.5 million with various expiration and cancellation terms of less than one year, for an aggregate repurchase obligation with all floor plan financing institutions of $29.6 million as of December 31, 2025.
The Company’s decisions about the amount of cash to be used for investing and financing purposes are influenced by its capital position and the expected amount of cash to be provided by operations. The Company also has a revolving line of credit facility to increase its flexibility for managing its investment in its working capital or for funding other purposes.
The Company also has a revolving line of credit facility, described below, to increase its flexibility for managing its investment in its working capital or for funding other purposes.
The Company is currently evaluating its funding options and timing to distribute participant balances. On January 28, 2025, the Board of Directors declared a regular quarterly cash dividend of $0.14 per common share payable March 10, 2025 to stockholders of record at the close of business on February 10, 2025.
The program by its terms does not have a predetermined expiration date. ​ On January 27, 2026, the Board of Directors declared a regular quarterly cash dividend of $0.14 per common share payable March 10, 2026 to stockholders of record at the close of business on February 10, 2026.
A 0.25 percentage point change in cost of incentives as a percentage of gross sales during 2024 would have increased or decreased net sales, gross margin and operating income by approximately $0.5 million.
A 0.25 percentage point change in cost of incentives as a percentage of gross sales during 2025 would have increased or decreased net sales, gross margin and operating income by approximately $0.5 million. 33 ​ Warranty costs The Company records as part of selling, general and administrative expenses an experience-based estimate of the future warranty costs to be incurred when sales are recognized.
The changes in the other components of working capital were consistent with the decrease in net sales and lower production levels as well as the timing of payments and receipts. ​ Cash used for investing activities in 2024 decreased $3.4 million in comparison to 2023 due to lower capital expenditures in 2024.
The changes in inventory and other components of working capital were consistent with increased production level in the fourth quarter of 2025, as well as the timing of payments. ​ Cash used for investing activities in 2025 increased $0.3 million in comparison to 2024 due to the distribution and proceeds from a benefit plan financing arrangement, partially offset by lower capital expenditures in 2025.
The Supplemental Executive Retirement Plan (“SERP”) investments are measured at net asset value, which is computed using inputs such as cost, discounted future cash flows, independent appraisals and market based comparable data or net asset values calculated by the investment fund which are not publicly available. 27 ​ Off Balance Sheet Arrangements To assist dealers in obtaining financing for the purchase of their boats for inventory, the Company has entered into agreements with various third-party floor plan lenders whereby the Company guarantees varying amounts of debt for qualifying dealers on boats in dealer inventory.
Prior to the dissolution of the Supplemental Executive Retirement Plan (“SERP”) in the fourth quarter of 2025, SERP investments were measured at net asset value, which was computed using inputs such as cost, discounted future cash flows, independent appraisals and market based comparable data or net asset values calculated by the investment fund which are not publicly available.
Working capital was a source of cash in 2024 due primarily to a net favorable change of $11.7 million in inventory, partially offset by a net unfavorable change in other components of working capital. The net favorable change in inventory during 2024 was due primarily to the decrease in production during 2024 in comparison to the prior year.
Working capital was a use of cash of $7.8 million in 2025 compared to a source of cash of $6.0 million in the prior year. In the current period, working capital was a use of cash due primarily to a net unfavorable change of $4.7 million in inventory, coupled with unfavorable changes in other components of working capital.
The decrease in the 2024 effective tax rate is primarily due to the stronger impact of favorable permanent and discrete adjustments on a decreased pretax income, coupled with increased tax credits, including credits related to the Company’s solar panel installation at its manufacturing site in Nashville, Georgia. Net income and diluted earnings per share.
In 28 ​ addition, the 2024 effective tax rate was unusually low because of the Investment Tax Credit related to the Company’s solar panel installation at its manufacturing site in Nashville, Georgia. Net income and diluted earnings per share.
Cash used for financing activities in 2024 increased $24.5 million compared to 2023 primarily due to higher dividends paid to common shareholders, including a special dividend of $0.70 per share ($24 million) paid during the second quarter of 2024. Cash Requirements Management expects that capital expenditures during 2025 will be approximately $3.2 million.
Cash used for financing activities in 2025 decreased $24.0 million compared to 2024 primarily due to a special dividend paid in the second quarter of 2024.
Fair Value Measurements The Company’s assets and liabilities measured at fair value are classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation. Assets and liabilities that are traded on an exchange with a quoted price are classified as Level 1.
Assets and liabilities that are traded on an exchange with a quoted price are classified as Level 1. Assets and liabilities that are valued using significant observable inputs in addition to quoted market prices are classified as Level 2.
Management expects year-over-year sales comparisons to be generally flat in the near-term, with potential for growth in the second half of 2025. In 2024, net sales outside of the United States accounted for 5.6% of net sales compared to 5.9% of net sales in the prior year. Cost of Goods Sold .
In 2025, net sales outside of the United States accounted for 4.5% of net sales compared to 5.6% of net sales in the prior year. Cost of Goods Sold . Cost of goods sold increased 3.4% in 2025 compared to 2024 due to higher materials expense and labor costs.
Outlook We believe that the strong retail demand for new recreational boats which began in 2020 with the onset of the COVID-19 pandemic has subsided and has now normalized. Higher selling prices for boats following rapid inflation and rising interest rates have also both contributed to higher costs of boat ownership, further curbing consumer demand.
Higher selling prices for boats following rapid inflation and higher interest rates in recent years have both contributed to higher costs of boat ownership, curbing consumer demand following several years of high post-pandemic sales.
The income tax provision decreased to $3.3 million in 2024 from $10.4 million in 2023. The effective tax rate reflects an income tax provision of 15.6% in 2024 compared to 19.9% in 2023.
Income Tax Provision. Income tax provision was $4.4 million in 2025 compared to $3.3 million in the prior year. The effective provision rate was 27.8% in 2025, compared to a 15.6% effective provision rate for the prior year.
While interest rates have begun to decrease, the Company believes it may take further interest rate relief to drive increased consumer appetite for new boat purchases. The Company is actively monitoring dealer inventories and order patterns for an uptick in demand, at which point we may increase production schedules.
As noted above, we also expect to incur substantial costs in connection with the Mergers. While interest rates began to decrease during 2024 and in 2025, the Company believes it may take further interest rate relief to drive increased consumer appetite for new boat purchases.
Management expects this reduction to continue to favorably impact operating cash flow in future periods. The Company has entered into agreements with third-party floor plan lenders where it has agreed, in the event of default by a qualifying dealer, to repurchase MPC boats repossessed from the dealer.
However, the Merger Agreement allows regular, quarterly dividends but limits them to a cap of $0.14 per Company common share during the time period between the execution of the Merger Agreement and the completion of the Mergers except as specifically approved by MasterCraft. ​ The Company has entered into agreements with third-party floor plan lenders where it has agreed, in the event of default by a qualifying dealer, to repurchase MPC boats repossessed from the dealer.
Gross profit decreased to $45.5 million in 2024, from $90.4 million in 2023. Operating income decreased to $18.3 million in 2024, from $49.2 million in the prior year. Net income decreased to $17.9 million in 2024, from $41.7 million in the prior year. Diluted earnings per share was $0.50 for 2024, down from $1.21 for 2023.
Sales growth trends improved through the year as our field inventory position improved. Gross profit increased to $46.8 million in 2025, from $45.5 million in 2024. Operating income decreased to $14.0 million in 2025, from $18.3 million in the prior year. Net income decreased to $11.4 million in 2025, from $17.9 million in the prior year.
The decline in 2024 was primarily due to lower revenues and gain of disposition of assets, net. ​ EBITDA and EBITDA margin. EBITDA was $21.1 million in 2024 compared to $51.6 million in 2023. EBITDA margin was 8.9% in 2024 compared to 13.5% in 2023. ​ Net cash provided by operating activities and Free cash flow.
EBITDA was primarily lower due to higher SG&A expenses outlined above and a $1.0 million credit related to a capital project recorded in the fourth quarter of 2024 that did not recur in 2025. ​ Net cash provided by operating activities and Free cash flow.
Selling, general and administrative expenses were 11.6% of net sales in 2024 compared to 11.3% in 2023. Gain on disposition of assets, net. Gain on disposition of assets, net for 2024 was $144 thousand compared to $2.0 million for 2023. In 2023, gains on disposition of assets included a $1.8 million gain related to a real estate transaction.
Selling, general and administrative expenses also include $0.5 million of transaction costs, incurred in the fourth quarter of 2025, related to the Mergers. Selling, general and administrative expenses were 13.4% of net sales in 2025 compared to 11.6% in 2024. Interest Income, net.
The Company has a stock buyback program initially adopted in 2001 and subsequently amended in 2013 and 2019 that authorized the aggregate repurchase of 8,250,000 shares in the open market. The Company did not repurchase any shares under this program in 2024 and 2023. There are 1,570,428 shares that remain available for repurchase as of December 31, 2024.
In addition, as described under “Item 1. Business – Proposed Mergers with MasterCraft,” the Merger Agreement could require us to pay a termination fee of $11.6 million, in cash, under certain specified circumstances. ​ The Company adopted a stock buyback program in 2001 that as subsequently amended authorized the aggregate repurchase of 8,250,000 shares in the open market.
Removed
These results reflected lower demand as our dealers sought to reduce inventories after strong demand immediately after Covid-19. While the Company made significant efforts in 2023 and 2024 to reduce costs and align production to a lower demand level, profit margins contracted due to increased promotional expenses and the negative impact of fixed costs coupled with the sales decline.
Added
Overview and Outlook On February 5, 2026, we entered into the Merger Agreement with MasterCraft, which marks an exciting new chapter for Chaparral and Robalo, and is a testament to the hard work and dedication of our employees.
Removed
We have adjusted production levels to more closely align with expected demand, however this reduction has resulted in reduced fixed cost absorption and negatively impacted our profit margins.
Added
We believe that MasterCraft will be a great steward of the combined business and an enthusiastic partner to our exceptional dealers and suppliers. In addition, the combination is structured to enable stockholders to continue to participate in the strength and upside potential of the combined 26 ​ company and benefit from a stronger institutional following.
Removed
Dealers continued to tightly manage their inventories in the face of elevated floor plan carrying costs and soft consumer demand. The Company’s quarterly sales decreases in the current year compared to the prior year became less pronounced as 2024 progressed.
Added
Details of the Mergers are further described in the Note titled Subsequent Events in the Notes to the Consolidated Financial Statements. Consolidated net sales increased 3% to $244.4 million in 2025 due primarily to a 9% increase in positive price/mix, partially offset by a 6% decrease in unit sales to dealers.
Removed
Cost of goods sold decreased 34.9% in 2024 compared to 2023 due to lower materials expense and labor costs.
Added
Diluted earnings per share was $0.32 for 2025, down from $0.50 for 2024. Interest rates have remained elevated, and any sustained decrease could be another catalyst for dealers and consumers to increase spending. The Company continues to focus on reducing costs and aligning production to the expected demand level.
Removed
As a percentage of net sales, cost of goods sold increased to 80.8% in 2024 compared to 76.4% in 2023 primarily due to lower sales volumes and associated manufacturing cost inefficiencies, as well as higher promotional expenses compared to the prior year. Production schedules and labor costs have been adjusted to more closely align with reduced demand.
Added
However, the impact of tariffs on prices of imported manufacturing materials and components could contribute to inflation and limit further interest rate reductions. The Company actively monitors dealer inventories and order patterns for changes in demand and adjusts production levels accordingly.
Removed
The Company intends to monitor order patterns and maintain these reduced production levels until more definitive signs of increased demand develop. Selling, General and Administrative Expenses . Selling, general and administrative expenses decreased by $15.8 million or 36.6% in 2024 compared to 2023.
Added
Sales growth trends improved through the year as our field inventory position improved, and we were better able to match retail demand with wholesale shipments. The Company’s field unit inventory at the end of the fourth quarter of 2025 was approximately 5% lower than the fourth quarter of 2024.
Removed
This decrease was primarily due to costs that vary with sales and profitability, such as incentive compensation, sales commissions and warranty expense, as well as a decrease in pension expense in comparison to the prior year. In 2023, selling, general and administrative expenses also included a non-cash pension settlement charge of $2.4 million.
Added
As a percentage of net sales, cost of goods sold increased to 80.9% in 2025 compared to 80.8% in 2024. Selling, General and Administrative Expenses . Selling, general and administrative expenses increased by $5.4 million or 19.6% in 2025 compared to 2024.
Removed
In addition, working capital was a source of cash of $6.0 million in 2024 compared to a source of cash of $13.7 million in the prior year.
Added
This increase was largely due to costs that typically vary with sales such as warranty cost adjustments, commissions and advertising along with R&D investments and a $1.0 million credit related to a capital project recorded in the fourth quarter of 2024 that did not recur in 2025.
Removed
Key capital investment projects in 2024 included the solar panel installation at the Company’s production site, and in 2023 included warehouse expansions and transportation equipment purchases.
Added
The increase in the effective tax rate in 2025 compared to the prior year is primarily due to unfavorable permanent adjustments, mainly driven by the liquidation of company-owned life insurance policies that were part of the dissolution of a non-qualified supplemental retirement income plan.
Removed
The Company participated in a multiple employer Retirement Income Plan (“Plan”), sponsored by RPC. During 2023, the Plan was fully terminated through a liquidation of the assets held in a trust.
Added
The decline in 2025 was primarily due to lower revenues, coupled with typical costs that vary with sales and higher R&D investments, as well as the lack of a favorable credit that occurred in the fourth quarter of 2025 but did not repeat in the fourth quarter of 2025. ​ EBITDA and EBITDA margin.
Removed
The program does not have a predetermined expiration date. In the fourth quarter of 2024, the Board of Directors approved the termination of the Supplemental Executive Retirement Plan (“SERP”). Pursuant to the Internal Revenue Service rules, participant balances will be distributed between 12 and 24 months after termination.
Added
EBITDA was $17.2 million in 2025 compared to $21.1 million in 2024. EBITDA margin was 7.0% in 2025 compared to 8.9% in 2024.
Removed
Effective October 1, 2023, the Company began recording short-term cash incentive compensation expense to certain non-executive employees in an annual amount equal to nine percent of pre-tax profit (PTP incentive), defined as pretax income before goodwill adjustments and certain allocated corporate expenses.
Added
The Company’s decisions about the amount of cash to be used for investing and financing purposes are influenced by its capital position and the expected amount of cash to be provided by operations and are currently subject to limitations imposed by the Merger Agreement during the time period between the execution of the Merger Agreement and the completion of the Mergers.
Removed
Through the third quarter of 2023, this PTP incentive was 16% in the aggregate per year and was subject to either a contractual arrangement or a discretionary determination. The PTP incentive under a contractual agreement with one employee, in the amount of seven percent per year, was discontinued as of September 30, 2023.
Added
However, the Merger Agreement generally caps the amount of indebtedness that the Company can incur outside the ordinary course of business at $1 million during the time period between the execution of the Merger Agreement and the completion of the Mergers except as specifically approved by MasterCraft .
Removed
See further information regarding repurchase obligations in the note titled Commitments and Contingencies in the Notes to the Consolidated Financial Statements. ​ In 2024, the Company entered into a three-year floor plan financing agreement with a single third-party lender which will be phased in beginning in the first quarter of 2025 to replace a majority of the existing agreements with the current third-party lenders.
Added
As of December 31, 2025, the Company had no outstanding borrowings under the revolving credit agreement. 30 ​ The Company has a shelf registration statement on Form S-3 filed with the Securities and Exchange Commission (SEC) that expires on May 5, 2028, which permits it to offer common stock, preferred stock, warrants, rights, depositary shares, purchase contracts and units containing two or more of the foregoing, in one or more offerings in an aggregate amount of up to $150 million.
Removed
The agreement is substantially similar to the current arrangements with the existing third-party floor plan lenders and provides for certain additional incentives to the Company and qualifying dealers over the term of the agreement.
Added
The Form S-3 is intended to provide us the flexibility to conduct registered sales of our securities, subject to market conditions and our future capital needs.
Removed
Related Party Transactions See the note titled Related Party Transactions in the Notes to the Consolidated Financial Statements for a description of certain related party transactions.
Added
However, the Company’s ability to issue securities is currently restricted by the Merger Agreement during the time period between the execution of the Merger Agreement and the completion of the Mergers except as specifically approved by MasterCraft. ​ In the third quarter of 2025, MPC implemented the provisions of Public Law 119-21, commonly referred to as the One Big, Beautiful Bill Act (“OBBBA”), which resulted in a lower tax obligation due to the 100% bonus depreciation on capital expenditures placed in service after January 19, 2025 and immediate expensing of all domestic research and development costs, that were previously amortized over five years.
Removed
Warranty costs The Company records as part of selling, general and administrative expenses an experience-based estimate of the future warranty costs to be incurred when sales are recognized. The Company evaluates its warranty obligation for each product line on a model year basis.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

2 edited+0 added−0 removed1 unchanged
Biggest changeMarine Products does not expect any material changes in market risk exposures or how those risks are managed. ​ ​ 29 ​
Biggest changeMarine Products does not expect any material changes in market risk exposures or how those risks are managed prior to the completion of the Mergers. ​ ​ 34 ​
As of December 31, 2024, there were no outstanding interest-bearing advances under our credit facility which bore interest at a floating rate. ​ Marine Products has no derivative financial instruments which could expose the Company to significant market risk. Marine Products maintains investments primarily in money market funds which are not subject to material interest rate risk exposure.
As of December 31, 2025, there were no outstanding interest-bearing advances under our credit facility which bore interest at a floating rate. ​ Marine Products has no derivative financial instruments which could expose the Company to significant market risk. Marine Products maintains investments primarily in money market funds which are not subject to material interest rate risk exposure.

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