Archive for » February 10th, 2015«

Rising economic tide lifts MarineMax, boating industry

After a perfect economic storm nearly swamped Clearwater’s MarineMax, the nation’s largest boat retailer is on the rebound — good news for a struggling recreational boat industry and a big thumbs-up for Florida’s improving business climate.

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The company’s stock price that sank as perilously low as $1.44 in early 2009 and struggled in single digits for most of the next half decade now shows signs of robust recovery.

MarineMax shares closed near $26 on Monday’s markets, a price range the 17-state, 54-store company has not seen in nine years.

“Not only does it have double-digit earnings growth prospects,” stock research firm Zacks said of MarineMax this past week, “but better days are ahead.”

“We are positioned to continue to benefit from the rising tide of the industry,” said MarineMax CEO Bill McGill of his company’s latest quarterly performance. “Clearly, the growth we produced is evidence of a broadening recovery, although we believe our growth has outpaced that of the overall industry.”

MarineMax has survived not only the nastiest recession since the 1920s, it also endured the aftermath of the 2010 gulf oil spill, which depressed boat sales from the gulf to as far north as the Carolinas. And it struggled through a spike in gas prices that only fed consumer fears that boating was an expensive indulgence in harder times.

Sales first soured in the early days of the recession with smaller and cheaper boats, then progressed to 30-foot mid-sized models before depressing the yacht market.

In the spring of 2008, McGill told the Tampa Bay Times he thought the fall of 2007 was as bad for boating as it would get. “It has actually gotten worse,” he said then.

And worse still by the summer of 2008. “Business is as bad as anybody in this industry has seen it since the energy crisis of the 1970s,” McGill said. By then, MarineMax’s 87 stores were losing sales at such a clip that McGill closed more than 30 locations.

In the most recent quarter ended Dec. 31, MarineMax store sales soared 45 percent on top of a 9 percent increase in the same period a year earlier. Revenue in the latest quarter grew over 44 percent to $158.1 million.

Sales of boat builder Brunswick Corp., maker of Sea Rays and Boston Whalers, make up 40 percent of MarineMax revenue. The company employs about 1,200.

Industry forecasts for 2015 by the National Marine Manufacturers Association are almost bullish. “An improved economy with GDP projected to grow 3 percent, an improving housing market, a stronger job market, increasing consumer confidence and a multiyear low on fuel prices have bolstered people’s financial outlook, which bodes well for new boat sales,” stated Thom Dammrich, NMMA president.

That works both ways in Florida. In a state where time spent on the water is a cultural icon, stronger boat sales help bolster all parts of the state economy.

Contact Robert Trigaux at rtrigaux@tampabay.com. Follow @venturetampabay.


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Tennessee operator plans $10 million in Small Boat Harbor upgrades

For decades, the Small Boat Harbor has suffered from neglect.

A new operator now promises to turn the storage facility into a popular destination that builds on the transformation underway along Buffalo’s waterfront.

The Small Boat Harbor will receive about $10 million in upgrades over the next five years in new docks, redesigned slips, electrical and water service, and a full-service restaurant, following the selection Monday of a Knoxville, Tenn.-based company to operate the Outer Harbor site.

A major investment has long been needed, but the work will come at a price – higher slip fees. The lease and operating agreement allows Safe Harbor Development to help recoup its capital investment – including potentially expensive dredging costs – by raising the fees.

“I am glad someone is getting a fresh look at our harbor, and that they are going to address these problems because they have existed for so long. We need a big fix, and I’m very excited,” said Karen Dwigun of Elma, who has used the Small Boat Harbor with her husband, Jerry, for more than 20 years. The docks are rusting from the bottom, she said, and other deteriorating conditions have worsened for years.

At the same time, Dwigun said she hoped that slip fee increases wouldn’t price anyone out. “People would really have to see it being turned into a first-class marina to accept them,” she said.

Under terms of the 25-year lease, which includes two 10-year renewal options, Safe Harbor will oversee the 1,037-slip marina, 8,000-square-foot restaurant and administration building, 214 parking spaces, bait shop and storage facilities.

The company will pay between $75,000 and $90,750 annually during the life of the lease, along with 5 percent of rent generated from the property, 2 percent of fuel sales and 1 percent from boat sales or services.

Safe Harbor can raise slip fees by an average of up to 7 percent per year for the first five years, and up to 5 percent per year thereafter.

Darby Campbell, Safe Harbor Development’s sole owner, said he wanted to invest in Buffalo after following from afar the amount of public and private development being poured into the waterfront.

“I’m on cloud nine thinking I was actually selected for this opportunity,” said Campbell, who hopes to turn the site into a year-round destination, with a better restaurant, live music and possibly a winter festival.

“What we want is to create an environment where people want to go, boaters and nonboaters. We want the public to use the waterfront, because water’s magic,” Campbell said. “I’ve never seen a better piece of water than what you have right here with the protected harbor.”

Campbell said he also plans to offer boat rentals.

Safe Harbor Development, chosen by Erie Canal Harbor Development Corp. on Monday over two other companies, will introduce year-round concrete slips and concrete docks beginning in 2016.

There also will be higher water pressure, electrical upgrades and better walkways and security, as well as more landscaping, benches, trails and changes to the restaurant.

“We’ll build a new one or work with the one that’s there,” Campbell said, “but right now, when you arrive at the marina, you see the backside of the restaurant, and that’ll change.”

Tucker Curtin, who operates Dug’s Dive restaurant, is under contract until January 2016. Campbell said he would speak with him at some point to discuss future plans.

Safe Harbor is Tennessee’s largest marina operator, along with restaurants, recreational vehicle parks and entertainment facilities. This is the company’s biggest project outside Tennessee.

The Small Boat Harbor, under the control of the Niagara Frontier Transportation Authority for decades, is now part of Buffalo Harbor State Park, created in September 2013 by Gov. Andrew M. Cuomo.

Parks Commissioner Rose H. Harvey, in a statement, said Safe Harbor Development received glowing references from other municipalities working with the company, and emerged as the candidate that offered “the boldest vision.”

email: msommer@buffnews.com


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