Archive for » June 18th, 2013«

Report: Boat industry helps NH economy stay afloat

An industry report says some $321 million was spent on boats in the Granite State, and that spending leaves about the same amount of indirect economic activity in its wake


Those boats, parked in a driveway or tied to a pier, make a big splash in the state’s economy — a $760.7 million splash to be precise, if you count the ripple effect, according to a report released last week by the National Marine Manufacturers Association.

The industry’s “rising tide” (the words of the association’s press release) caused by the 77,500 boats in the state supported more than 6,000 jobs and 256 businesses in New Hampshire, according to the report. Nationally, the industry claims credit for 964,000 jobs and 35,000 businesses.

The association said people spend about $321 million on their boats in the Granite State, and that spending directly leaves about the same amount of indirect economic activity in its wake. Nationally, $83 billion in spending results in an economic value of $121 billion, according to the report. The industry anticipates sales will grow by 5 percent in 2013.

“New boat sales have historically been a barometer for the U.S. economy, and the steady sales increases we’re seeing are being reinforced by the slow uptick in consumer confidence, housing and spending,” said Thom Dammrich, president of the association.

This article appears in the June 28 2013 issue of New Hampshire Business Review

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Celebrating sails of the century

Celebrating sails of the century

By Ruth Meech

PIONEERS: The founding fathers of Weymouth Sailing Club

AN ACTION-PACKED summer lies ahead for Weymouth Sailing Club (WSC), which celebrates its centenary this year.

The popular harbourside club was inaugurated in 1913 as the Franklin Sailing Club and changed its name to the current one in 1920. There had been an amateur club in the town between 1882 and 1910 in the Corinthian Yacht Club, some members of which eventually joined the Franklin Club.

The founding fathers of WSC can be seen in the group photo taken in 1913.

The elderly gent with a white beard in the front row is John Rule, a professional boatman who ran boats on Weymouth beach with his son Percy.

Other boats were owned by HW Gill, Frederick Hillier and the eponymous Franklin Smith, a Nova-Scotian inventor from the Whitehead Torpedo factory and first Commodore of the club.

The first race was held on Wednesday, September 10, 1913 and the winner on handicapped time was Mr R Turner’s boat called Florence.

This year many commemorative centenary events are being planned over the coming months, starting on June 21 with a flotilla crossing to Cherbourg, whose yacht club is celebrating its 75th anniversary.

Other events include an inter-port sailing match with Parkstone on the Nothe Olympic course on July 28, competing for the 1926 Bussell Cup donated by local boat builder WL Bussell, one of the founding fathers of Weymouth Sailing Club.

There will also be a celebratory party and sail-past on September 7 and 8 and an exhibition of the club’s history, centring on a Falcon sailing dingy, between August 31 and September 8 in the club longhouse along Weymouth Harbour.

Further details of the club’s history will be appearing on these pages throughout the year and if any readers have images or memories they would like to share, please do get in touch.

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Don’t Miss The Golden Boat: Capitalize On The Latest Car Sales Resurgence


Car sales in the month of May have impressed analysts, customers and car manufacturers, as 2013 continues to show an impressive improvement in the American car industry. With the exception of Mitsubishi (MMTOF.PK), all of the major car manufacturers had positive year-to-year increases in the month of May. Ford (F), General Motors (GM) and Toyota (TM) are the biggest manufacturers of cars in the American market, all with a sizable amount of market share. It is only logical that we assess the potential of these companies on the stock market and find the appropriate option for automotive stock enthusiasts.

Source: Autodata

Tracking Financials

General Motors in particular has added new models to the Buick and Cadillac series, whose sales are up by 23% and 37%, respectively. GM is North America’s largest automaker and has a market capitalization of $47.1 billion. Over the last 3 years the company’s results have been less than optimal, as negative net-income growth underlines the re-structuring that the company had to take. As the company introduced new vehicles, 61% of the company’s product line will be turned over in the space of the next two years. Currently the company’s net margin is 4.2%, but I expect this to be much higher in the coming years as a fleet of new cars such as Silverado, Sierra and Malibu are introduced.

Data from Morningstar on 17 June, 2013

Ford, on the other hand, has a market capitalization of $60.4 billion and has announced it’s discontinuing car-manufacturing in Australia as the company suffered a $141 million after-tax loss for 2012-13. Unlike General Motors– whose sales of Chevrolet Volt have been catastrophically low– in the first five months of 2013, Ford has already surpassed its full-year hybrid sales record. In 2012, the company was plagued with a money sinkhole called Europe, where massive losses were incurred by the blue oval. After a 16% loss in year-to-year sales for last year, a similar trend is expected this year, too. Ford expects to cut its assembly capacity by 18% (355,000 units) and reduce the European workforce by 13%, which should save it $450-500 million annually. This should undoubtedly improve the company’s net margin further.

The company’s 1.95% dividend is a big incentive for investors when choosing between Ford and fellow American car maker GM. In the U.S, Ford has gained slightly more market share in 2013 and earned 60% more in corporate net income during the first quarter. The last time I wrote about Ford, its debt/equity was far less than the stated 5.1 in this table. Contrary to popular belief, this is a good thing as this is shows that Ford Finance has given out more loans than before – loans that will earn it interest revenue.

Toyota is the only non-American auto manufacturer I have included in this analysis because of the weaker yen, which has allowed Toyota to price its products competitively. Toyota has taken over the crown as Asia’s largest manufacturer in stock market value, while it already is the world’s largest auto maker. With a market capitalization of $202.4 billion, Toyota completely overshadows its U.S. rivals but fails to show similar dominance in the field of revenue growth and net income growth over the past 3 years. While it loses market share to Ford and General Motors in the U.S. market, Toyota has the advantage of having access to emerging markets, from where it aims to gain traction and fuel its growth for the coming years.

Dividend and Stock Performance

A very important source of revenue from stocks is the quarterly dividend. In the case of Ford, GM and Toyota, this is even more important as the largely varying market capitalizations can cloud the real dividends being offered by the yields. Furthermore, Ford and Toyota have an advantage over GM from the outset, since GM still does not provide dividends. Ford offers a yield of 1.95% at a payout ratio of 14.1%. Toyota’s yield of 1.17% is paid at a ratio of 52.3%, which is a very healthy amount.

Ford’s prudence is understandable with its roll-back, reinvestment costs in Europe and the aggressive product introduction in the North American market. Toyota, on the other hand, has decreased its dividend amount over the past three years due to the uncertainty and slowdown of the world economy. However, its stock has had a completely different outcome over the last few years, as the graph below illustrates.

The graph starts from 2011 when General Motors got its papers approved for a public stock offering. Since then, GM has finally reached and surpassed its opening price of $33.0. Its Toyota rival has seen its price appreciate by a staggering 64.81%, while Ford’s price has grown by 29.49%. As GM’s price crossed $33.0, it was announced that the company would rejoin Standard and Poor’s 500 Index.

Litmus Test

In the car industry, sales are pretty simple to gauge. They entirely depend upon the quality of the product which is being sold. This, of course, is realized over some time. After years of providing cars which were outperformed by its competitors, the American companies are finally “bringing their A game.” Toyota is losing its market share in the North American market fast and it is losing its market share to Ford and GM. Ford, in particular, has introduced four models in its new ‘super segment‘ to rival the decade old stronghold of Toyota. The company has added new product lines for Escape, Fusion, Focus and Fiesta to do the job.

For GM, Cadillac’s sales are growing faster than they have in almost 40 years. In China, GM sells more vehicles than it does in the U.S and in May, the company reported a 9.4% increase in the sales of Buicks. However, the slowing down of the Chinese economy might end up affecting the company adversely. All of this is bad news for the Japanese car manufacturer. The only good news that Toyota has to offer is the weaker yen, which will make its products more competitively priced.

Bottom Line

In my opinion, Ford has already passed the litmus test as it is gaining market share and introducing strong products in the North American market. Furthermore, streamlining and cutting costs in the international market will help it boost its margins. Buy Ford and go long.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. (More…)

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Report: Boating economy floats $655M to Boston

The National Marine Manufacturers Association (NMMA) announced that recreational boating in the United States has an annual economic value of $121 billion. Part of that money comes from a 10.7 percent increase in retail sales of new powerboats and a 29.2 percent increase on sailboats.

For the first time this year, the NMMA broke down the results of its study state by state. In Boston, the total economic impact of recreational boating is $655.6 million. The city hosts a total of 256 boating industry businesses with 5,321 workers.

As far as a favorite type of boat, 78 percent of the boats sold in Boston are powerboats. Overall, there are 48,007 recreational boats in the city. Powerboats represent 82 percent of the national boat market, and currently the NMMA is hoping for 5 percent increase during 2013.

As a whole the industry’s rising tide supports 964,000 jobs, 34,833 businesses, generates $40 billion in annual labor income and drives $83 billion in annual spending.

“New boat sales have historically been a barometer for the U.S. economy and the steady sales increases we’re seeing is being reinforced by the slow uptick in consumer confidence, housing and spending. As economic growth continues, we anticipate sustained steady growth through the remainder of 2013,” said Thom Dammrich, NMMA president, on the press release.

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