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Marine Products Corporation Announces a Correction of Previously Announced Unaudited Financial Results for the Fourth Quarter and 12 Months Ended December 31, 2013

ATLANTA, Feb. 28, 2014 /PRNewswire/ -- Marine Products Corporation (NYSE: MPX) today announced a correction of its previously announced unaudited financial results for the fourth quarter and year ended December 31, 2013 due to an error in accumulating and recording accounts payable. 

During the course of Marine Products Corporation's annual audit in preparation for the filing of its annual financial statements, the Company discovered this error, which impacted the Company's accounts payable and accrued liabilities as well as cost of goods sold and other income statement data included in its prior press release for the quarter and year ended December 31, 2013.  For this reason, investors are cautioned not to rely on the unaudited financial results for these periods as disclosed in the press release issued by Marine Products Corporation and discussed in its conference call on January 29, 2014.

The Company has determined that this error only affects the reported financial results for the quarter and year ended December 31, 2013, and not any prior quarterly or annual results.  In connection with this error, the Company's management is considering the adequacy of its internal control over financial reporting and will disclose its findings in its Form 10-K for the 12 months ended December 31, 2013.

For the quarter ended December 31, 2013, Marine Products generated net sales of $39,786,000, a 16.5 percent increase compared to $34,152,000 in the same period the prior year.  (The Company's January 29, 2014 press release previously reported $39,534,000 in net sales for the fourth quarter of 2013.) The increase in net sales was due to an increase in the number of units sold as well as the average selling price per boat, as well as higher parts and accessories sales. 

Gross profit for the quarter was $7,655,000, a 38.2 percent increase compared to gross profit of $5,538,000 in the prior year.  Gross profit as a percentage of net sales was 19.2 percent, compared to 16.2 percent of net sales in the prior year.  (The Company's January 29, 2014 press release previously reported gross profit of $8,207,000, or 20.8 percent of net sales for the fourth quarter of 2013.)  As a percentage of net sales, gross profit increased due to higher production volumes and a favorable model mix during the quarter.

Operating profit for the quarter increased by 134.6 percent to $2,756,000 compared to $1,175,000 in the fourth quarter of last year due to higher gross profit, partially offset by higher selling, general and administrative expenses.  (The Company's January 29, 2014 press release previously reported operating profit of $3,260,000 for the fourth quarter of 2013.)  Selling, general and administrative expenses increased by 12.3 percent to $4,899,000 in the fourth quarter of 2013 compared to $4,363,000 last year.  (The Company's January 29, 2014 press release previously reported selling, general and administrative expenses of $4,947,000 for the fourth quarter of 2013.)  These expenses increased due to expenses which vary with sales and profitability, such as incentive compensation and sales commissions.  As a percentage of net sales, these expenses decreased slightly during the fourth quarter of 2013 compared to the fourth quarter of 2012.  Interest income was $114,000 during the fourth quarter of 2013, a decline of 58.1 percent compared to $272,000 during the fourth quarter of 2012.

Net income for the quarter ended December 31, 2013 was $2,142,000, compared to net income of $1,064,000 for the fourth quarter of 2012.  (The Company's January 29, 2014 press release previously reported net income for the fourth quarter of 2013 of $2,408,000.)  Diluted earnings per share were $0.06 in the fourth quarter of 2013 compared to $0.03 in the fourth quarter of last year. Diluted earnings per share during the fourth quarter of 2013 were unchanged from the amount the Company previously reported in its January 29, 2014 press release.

Net sales for the twelve months ended December 31, 2013 were $168,293,000, a 13.0 percent increase compared to the prior year.  (The Company's January 29, 2014 press release previously reported $168,041,000 in net sales for 2013.)  Net income for the twelve months ended December 31, 2013 was $7,528,000, or $0.20 per diluted share, compared to net income of $6,979,000, or $0.19 per diluted share, in 2012.  (The Company's January 29, 2014 press release previously reported net income of $7,794,000, or $0.21 per diluted share for 2013.)

Based on its review, management believes that the unaudited financial results disclosed today will be consistent with those that will be reflected in its Form 10-K for the 12 months ended December 31, 2013.  Marine Products Corporation anticipates that its Form 10-K for this period will be filed by March 14, 2014.

Marine Products Corporation (NYSE: MPX) designs, manufactures and distributes premium-branded Chaparral sterndrive pleasure boats; and Robalo sport fishing boats, and continues to diversify its product line through product innovation and is prepared to consider strategic acquisition targets.  With premium brands, a solid capital structure, and a strong independent dealer network, Marine Products Corporation is prepared to capitalize on opportunities to increase its market share and to generate superior financial performance to build long-term shareholder value.  For more information on Marine Products Corporation visit our website at www.marineproductscorp.com.

Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include statements that look forward in time or express management's beliefs, expectations or hopes.  In particular, such statements include, without limitation, the belief that the financial results disclosed in its Form 10-K for the 12 months ended December 31, 2013 will be consistent with those disclosed in today's press release, that Marine Products Corporation will file its Form 10-K for the 12 months ended December 31, 2013 by March 14, 2014, that no additional accounting errors will be discovered which impact the results of any prior period, and that the Company is prepared to capitalize on opportunities to increase its market share and to generate superior financial performance to build long-term shareholder value.  Additional discussion of factors that could cause the actual results to differ materially from management's projections, forecasts, estimates and expectations is contained in Marine Products' Form 10-K, filed with the Securities and Exchange Commission for the year ending December 31, 2012.

For information contact:

BEN M. PALMER
Chief Financial Officer
(404) 321-7910
irdept@marineproductscorp.com

JIM LANDERS
Vice President, Corporate Finance
(404) 321-2162
jlanders@marineproductscorp.com

 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES


































CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data)











Periods ended December 31, (Unaudited)


Fourth Quarter







Twelve Months




2013



2012


% BETTER

(WORSE)




2013



2012


% BETTER

(WORSE)


Net Sales

$

39,786


$

34,152


16.5

%


$

168,293


$

148,950


13.0

%

Cost of Goods Sold


32,131



28,614


(12.3)




138,480



121,746


(13.7)


Gross Profit


7,655



5,538


38.2




29,813



27,204


9.6


Selling, General and Administrative Expenses


4,899



4,363


(12.3)




20,307



18,443


(10.1)


Operating Profit


2,756



1,175


134.6




9,506



8,761


8.5


Interest Income


114



272


(58.1)




524



960


(45.4)


Income Before Income Taxes


2,870



1,447


98.3




10,030



9,721


3.2


Income Tax Provision


728



383


(90.1)




2,502



2,742


8.8


Net Income

$

2,142


$

1,064


101.3

%


$

7,528


$

6,979


7.9

%





































EARNINGS PER SHARE


















Basic

$

0.06


$

0.03


100.0

%


$

0.20


$

0.19


5.3

%

Diluted

$

0.06


$

0.03


100.0

%


$

0.20


$

0.19


5.3

%



















AVERAGE SHARES OUTSTANDING


















Basic


36,827



36,680






36,820



36,656




Diluted


37,237



36,820






37,144



36,804




 

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES












CONSOLIDATED BALANCE  SHEETS






At December 31, (Unaudited)


(in thousands)



2013



2012

ASSETS






Cash and cash equivalents

$

5,114


$

1,648

Marketable securities


5,639



1,150

Accounts receivable, net


2,021



1,794

Inventories


28,859



28,159

Income taxes receivable


692



394

Deferred income taxes


1,096



1,283

Prepaid expenses and other current assets


1,839



1,607

  Total current assets


45,260



36,035

Property, plant and equipment, net


11,265



11,470

Goodwill 


3,308



3,308

Other intangibles, net


465



465

Marketable securities


30,949



35,773

Deferred income taxes


3,177



3,531

Other assets


8,129



6,733

  Total assets

$

102,553


$

97,315







LIABILITIES AND STOCKHOLDERS' EQUITY






Accounts payable

$

5,569


$

4,246

Accrued expenses and other liabilities


8,993



9,000

  Total current liabilities


14,562



13,246

Long-term pension liabilities


6,420



6,232

Other long-term liabilities


88



90

  Total liabilities


21,070



19,568

Common stock 


3,810



3,782

Capital in excess of par value


3,583



2,417

Retained earnings


74,943



73,120

Accumulated other comprehensive loss


(853)



(1,572)

  Total stockholders' equity


81,483



77,747

  Total liabilities and stockholders' equity 

$

102,553


$

97,315

 

SOURCE Marine Products Corporation

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