Malibu Boats, Inc. (MBUU) Earnings Call Transcript & Summary

Good morning, and welcome to the Malibu Boats Conference Call. [Operator Instructions] Please be advised that reproduction of this call in whole or in part is not permitted without written authorization of Malibu Boats. And as a reminder, today's call is being recorded. On the call today from management are Mr. Steve Menneto, Chief Executive Officer; and Mr. David Black, Chief Financial Officer. I will now turn the call over to Mr. Black to get us started. Please go ahead, sir.

Thank you, and good morning, everyone. Joining me on today's call to discuss the acquisition of Saxdor is our CEO, Steve Menneto. A question-and-answer session will follow our prepared remarks. A press release covering the transaction was issued earlier this morning, and a copy of that press release as well as the supplemental presentation to this transaction can be found in the Investor Relations section of the company's website. I also want to remind everyone that the management's remarks on this call may contain certain forward-looking statements, including predictions, expectations, estimates and other information that may be considered forward-looking and that actual results could differ materially from those projected on today's call. You should not place undue reliance on these forward-looking statements, which speak only as of today, and the company undertakes no obligation to update them for any new information or future events. Factors that might affect future results are discussed in the press release covering the transaction, which contains information regarding our presentation of non-GAAP measures and our filings with the SEC, and we encourage you to review the press release and our SEC filings for a more detailed description of each of these risk factors. I will now turn the call over to Steve.

Good morning, everyone, and thank you for joining us. Today marks a monumental milestone for MBI as we announced the acquisition of Saxdor Yachts, a strategic transaction that accelerates our build, innovate and grow strategy in a meaningful way. Our ambition is clear: to build the world's leading global recreational boating company, and today's announcement is a meaningful step toward that goal. Before I dive into the details, let me frame why this moment is so significant. At our Investor Day in September, we laid out our bold vision for Malibu's future, one focused on becoming a global marine solution provider, not just simply a North American boat manufacturer, but an organization that serves customers across the full life cycle through our brands, our components business, our financing platform and our service infrastructure. Saxdor is the first major step toward that global vision, and it's a great one. It meets the framework we laid out at our Investor Day and positions us to continue building from here while allowing us to maintain our commitment of returning capital to shareholders. Guided by our build, innovate and grow framework, we set a high bar for acquisitions and Saxdor Yachts clears it with industry-leading growth and a highly accretive margin profile. What Saxdor's Founder and Chief Designer, Sakari Mattila, and his team have built over the past 5 years is remarkable. The products are world-class. The innovation engine is unlike anything else in our industry, and the bold brand resonates with a very attractive consumer demographic, one that is younger, affluent and adventure-orientated, who want performance, high-quality design and functional luxury at a competitive value. Let me walk you through why this acquisition is so strategic for Malibu. First, Saxdor is one of the world's fastest-growing boat brands, disrupting the $2.5 billion adventure dayboat category, which we believe is one of the most dynamic segments in global recreational boating, growing at a 15% CAGR according to the data from SSI. This is a segment where we didn't have a presence, and now we are entering it with a category leader. And this isn't a brand that's just riding a rising tide. Saxdor is redefining the category and dramatically outpacing the market and its segment. In the most recent calendar year 2025, Saxdor achieved year-over-year growth of approximately 65% with revenue of more than $210 million. In the U.S. alone, Saxdor's registrations have grown 378% over the last 2 years versus approximately 15% for the broader adventure dayboat category. They've produced and delivered over 2,000 boats worldwide since founding in 2019 and are now producing more than 500 units annually across facilities in Finland and Poland. To achieve that growth and scale globally in the 5 short years is unprecedented in our industry. The adventure dayboat segment represents exactly the kind of white space opportunity we've been talking about. It's an exciting, rapidly growing category that attracts a consumer looking for versatility in how they experience their boats. Up to 40% of Saxdor's customers are first-time boat buyers, 48% are under the age of 44. Average household income is approximately $375,000. These are affluent consumers who are new to boating and are choosing Saxdor as their entry point into the lifestyle. Because these buyers are young and early in their boating life cycle, they represent a long runway for deepening customer relationships through service and subsequent purchases across our broader portfolio. The compounding effect of the value is really attractive. These are customers we weren't reaching through our existing portfolio, and now we have a direct path to them. And think about where these customers are concentrated. North America is home to 2/3 of the world's high net worth adults and is the fastest-growing major wealth market globally. Yet it represents just 1/3 of Saxdor's geographical revenue mix today. That gap represents a significant growth opportunity for Saxdor, which we believe we can accelerate and capture. And Saxdor has cracked the code on reaching these consumers. Their brand positioning is built around 3 pillars: exceptional design, performance and price. And their team has delivered a premium product that feels aspirational while maintaining competitive price points, thus creating a unique value proposition for this attractive consumer demographic. Second, this acquisition expands and enhances our MBI portfolio in a way we've been working toward for some time. Saxdor fills the strategic gap between Cobalt's luxury sterndrive positioning and Pursuit's offshore capability. Think about it this way. We now have a comprehensive offering from wake sports with Malibu and Axis to luxury runabouts with Cobalt to adventure boats with Saxdor to offshore fishing with Pursuit, Cobia and our Maverick Boat Group brands. Each brand has its own identity, its own consumer, its own use case. But together, they give us unmatched breadth across the segments and the consumer demographics that matter most in recreational boating. And importantly, Saxdor doesn't cannibalize any of our existing brands. The adventure dayboat buyer is typically not cross-shopping a Cobalt or a Pursuit. These are different use cases, different water conditions, different purchase motivations. Cobalt is about luxury on the water. Pursuit is about serious offshore capability. Saxdor is about versatile design forward coastal exploration, day cruising, island hopping, social boating. It's additive in the truest sense and extends our consumer reach into saltwater lifestyle use cases in international markets where our legacy brands have had limited penetration to date. Third, this transaction creates a global distribution platform that neither company could build on its own. Let me walk you through both sides of that. Starting internationally, Saxdor distributes through a dedicated network of over 100 dealers across 5 continents in more than 50 countries. Europe represents approximately 50% of their revenue today. For context, Europe is less than 5% of our current business. We've talked at prior Investor Days about our ambition to become a truly global marine company, but we didn't have the infrastructure to do it. Now we do. Saxdor gives us the established dealer relationships, brand credibility and manufacturing footprint in the European market. And over time, we see a clear path to introduce Cobalt and Pursuit in markets where those brands have had virtually no presence. That's an opportunity we're very excited about. Turning to North America. Since its U.S. launch in 2022, Saxdor has built a meaningful momentum here, but North America only represents approximately 1/3 of their business today. We see a long runway for growth given the favorable demographic backdrop and this consumers' demonstrated propensity to invest in experiences. We'll be thoughtful and disciplined about how we approach that expansion. We want to protect the brand's premium positioning and ensure our dealer partners are set up for success. From an operational perspective, we see multiple value creation opportunities through what we call the MBI Advantage. We'll drive incremental value and operating efficiencies through procurement scale. Remember, we've been building our centralized sourcing capabilities and category management expertise and Saxdor's significant annual spend across propulsion, marine electronics, harnesses and raw materials creates immediate opportunities to leverage that infrastructure. We'll expand vertical integration through marine components, where the addition of Saxdor's volume strengthens the rationale for continued investments in capabilities like fiberglass parts, electrical, upholstery and harnesses. And importantly, we have an opportunity to meaningfully increase our North American manufacturing utilization. Our facility in Fort Pierce today operates at approximately 65% utilization across 530,000 square feet. We believe we can produce well north of 100 Saxdor units annually in that facility, leveraging existing capacity, existing labor and existing infrastructure with no significant incremental capital investment. That does 3 things for us. It improves our fixed cost absorption. It reduces Saxdor's exposure to the complexity of tariff policies, transatlantic shipping costs and currency fluctuation. And over time, it positions us to serve North American customers with shorter lead times and a more responsive supply chain. Meanwhile, Saxdor's European facilities in Finland and Poland will benefit from a rebalancing of our combined global manufacturing network, creating incremental capacity in their home markets and allowing for continued growth of the European and international markets. Beyond manufacturing and procurement, over time, we also expect to extend MBI acceptance and our dealer service capabilities to Saxdor's growing customer base. This is an important part of our thesis. Every lever we add beyond boat building makes the combined organizations more diversified, more durable across market cycles and more valuable on a per customer basis. That's the holistic marine solutions model we've been building towards. The innovation story here is equally compelling. Saxdor has pioneered modular boat design that allows for customization at scale, something we've been working toward across our portfolio. Their twin-step lightweight hull design optimizes for coastal durability while delivering best-in-class speed and fuel efficiency and their design philosophy of functional luxury aligns perfectly with where we see the market heading. Young, high net worth consumers want boats that look amazing, but are also incredibly versatile in how they can be used. Beyond the product itself, Saxdor is a digital-first organization and has developed an AI-powered customer experience platform that guides buyers from a virtual showroom through purchase, delivery and ongoing ownership. They recently became the first boat builder outside the U.S. to integrate the Fathom e-power system, an intelligent lithium-ion auxiliary power management solution built into the Mercury outboard engines. And their pace of product development is among the fastest in the industry, 8 model platforms in 5 years with additional models already in the pipeline. That combination of design, innovation and technology leadership is something we believe can benefit our broader organization over time. Supporting this effort is the Saxdor operating team that is expected to maintain their brand identity and operational autonomy as a subsidiary of MBI. Sakari Mattila, who has founded 5 boat brands over a nearly 5-decade career and is recognized as a pioneer of the adventure dayboat category, and the existing management and operating teams are joining Malibu to ensure continuity and continue driving the brand's innovation and growth agenda. This is a lean entrepreneurial group of professionals that fits well within our decentralized brand structure and retaining them was a priority throughout this process. I want to emphasize something important. This transaction demonstrates our disciplined approach to capital allocation. We're building for the long term while continuing to return capital to our shareholders. Those priorities are not mutually exclusive. We've structured this deal in a way that allows us to accelerate our global growth strategy while maintaining our commitment to shareholders through our recently expanded $70 million share repurchase program. With Saxdor, we are taking a major step towards our vision of becoming a global marine solutions provider, one with the brands, the manufacturing scale, the solutions platform and now the international reach to serve customers across their full life cycle. We believe we are creating a more resilient model that generates value across market cycles, not just when the tide is rising. We've said consistently that we're positioning this company for when the market returns to mid-cycle levels. And having Saxdor in the portfolio as that recovery takes shape means we capture growth not just from the broader market, but from new segments, new geographies and a younger consumer franchise that can compound for decades. With that, let me turn it over to David, and he'll walk you through the financial details.

Thanks, Steve. We acquired Saxdor Yachts for approximately EUR 150 million or USD 175 million, paid through a combination of EUR 110 million in cash and newly issued shares of Malibu common stock having approximately value of EUR 40 million. That represents an unsynergized valuation of approximately 7.2x Saxdor's adjusted EBITDA for the 12 months ended March 2026, which is a multiple we believe reflects our investment discipline given the growth profile of this business and where we are in the cycle. Additionally, Saxdor shareholders may earn up to EUR 72 million or USD 84 million in additional consideration tied to the operating and financial growth targets across calendar years 2026, 2027 and 2028. The earn-out structure aligns incentives, ensures the team that builds the business remains focused on its continued growth and profitability. From a financial perspective, as Steve mentioned, this transaction fits the framework laid out in our September Investor Day. Saxdor's growth engine is extremely attractive. Revenue grew approximately 65% in calendar 2025 and the business is expected to generate revenue of USD 225 million to USD 235 million and adjusted EBITDA margins of 10% to 11% for the 12 months ended March 31, 2026. To put that into perspective, the adventure dayboat segment grew roughly 15% over the same period despite the broader boating industry experiencing cyclical softness. Europe represents 50% of their revenue with North America at 33% and the balance from other international markets where they are building presence. That geographical diversity is a meaningful addition to our revenue mix and provides multiple vectors for growth independent of any market cycle. Saxdor's expanding profit margins will be immediately accretive to our adjusted EBITDA margin profile and will accelerate the long-term margin expansion trajectory we have outlined for investors. The transaction is expected to be also highly accretive to EPS in the first full year of ownership ending June 30, 2027. In terms of outlook, we are reaffirming our existing fiscal third quarter guidance as well as our full year fiscal 2026 guidance for the legacy MBI business. Importantly, these expectations do not reflect any assumption for M&A activity, including today's announcement. While we aren't in a position to provide specific forward guidance for the Saxdor business at this time, we can tell you that Saxdor has a powerful product pipeline that we aim to build upon, which we expect to support the strong double-digit growth rates in the near term and outperform the recent category growth rate of 15% that we spoke to today. We also expect Saxdor's operating margins to expand further as the business continues to scale and we implement our MBI Advantage operating framework. We look forward to providing you with additional details during our next quarterly update in May. Our balance sheet remains strong. Pro forma leverage stands at approximately 1.5x net debt to LTM December 2025 adjusted EBITDA, well below our stated maximum target of 2.5x. And we believe the strong cash flow profile of the combined company preserves flexibility for future opportunities, and we continue to return capital to our shareholders. Our $70 million share repurchase program, which we expanded in December 2025, remains fully in effect. As a reminder, we repurchased approximately $20.8 million in shares during the fiscal second quarter alone. In summary, we expect this deal to be highly accretive to EPS in year 1 while keeping leverage conservative and continuing our commitment to returning capital. And longer term, Saxdor broadens our customer reach and gives us multiple operational levers to drive value. We're confident this transaction fits the financial framework we've communicated and supports meaningful long-term shareholder value. Before we open the call up for questions, given the timing and nature of today's call, we ask that you limit your questions to the transaction and its strategic and financial implications. We'll address any questions related to our stand-alone quarterly performance on the next scheduled earnings call. With that, operator, please open the call up for questions.

[Operator Instructions] Our first question today will come from Craig Kennison of Baird.

I wanted to, I guess, understand the manufacturing footprint and the implications for tariffs. I think you're primarily building these boats in Europe. But to the extent you have success in the U.S. and want to ship those products here, what is the tariff regime that we should contemplate? And then to what extent could you build these boats in the United States if it were to grow?

Craig, I'll take the manufacturing. David, you can talk about tariffs. They build currently in Elk, Poland and in Larsmo, Finland. So -- and they're shipping into the U.S. from there. So as we said in our prepared remarks, we can -- we have the capacity to build those here in Fort Pierce. Our manufacturing teams have reviewed that. It's a boat that we can build. And that would help us tremendously, like we said, in servicing the market, servicing our main dealer here. And we're looking forward to being able to do that in the future as we work out with the logistics and planning for that. As far as tariffs go, David, you can handle that.

Yes. And maybe just adding to that, having manufacturing on both sides of the Atlantic gives us real flexibility regardless of what happens with trade policy. And so as we think about this on a go-forward basis, European production could serve the European and international markets. And that's a natural hedge. Over time, I think this dual continent manufacturing footprint reduces our exposure to any single trade policy regime. And as we think about tariffs, the current tariff environment is already contemplated in our underwriting and integration planning. So this isn't a super surprise, and it's something we've explicitly planned for.

That's very helpful. And then if I look at Malibu adjusted EBIT margin historically, it's been in that high teens range, even above 20% for several years before this correction phase. Does this transaction have that potential as well? Is there any cyclical juice in the margin here?

Yes. Craig, I'll take that one. So their current margin profile benefits from a lean and efficient operating model, but we do expect their EBITDA margin for the next 12 months to be in the range of 10% to 11%. But going forward, we expect their margins will continue to expand as further business continues to scale and they introduce new and larger boat models. So we think that there is a runway to a higher margin profile. We're just not ready to kind of talk about that on a forward-looking basis yet.

Our next question today will come from Gregory Miller of Truist Securities.

I'd like to ask about the labor model, the labor availability for the plants in Finland and Poland and just if you could compare that against the United States.

Sure. In both locations, marine building is actually a very prominent type of work in those cities and the greater areas there. So there are skilled labors here that work on the Saxdor business as well as other brands in the marine space. So there is available labor. It's well-trained labor, similar to what you see in Eastern Tennessee. So we like that. It mirrors what we're used to seeing in our own legacy business. It has a similar characteristics as that, Greg.

And I'd like to ask about just the timing of the deal. How long has this been in the works, if you could say? Or has this been considered for some time? Have you looked at some of their competitors in the adventure boating space?

Yes. We -- like anything in our -- we've talked about at Investor Day and our M&A efforts, we have a -- we cast a wide net. We continue to work the funnel in our M&A structure. So we've been always looking at opportunities across the world to fulfill our strategy. This is one of them. So in terms of how long we've been doing it, it's what we do every day. And this is clearly one that rose to the top that made sense for our business, and we looked at as an accretive opportunity. So we're going to continue to do that post this deal. We're going to have the same discipline of our capital allocation structure, continue to monitor more M&A activity and make sure that we remain disciplined as we run that play. So we feel good about this one.

The next question today will come from Jaime Katz of Morningstar.

I hope you guys can give us a little bit of insight as to why you decided to partially finance this with equity rather than debt given where the share price is right now. And then as we think about what the shares look like at year-end, does the potential for share buybacks imply that you should have flattish shares outstanding at fiscal year-end?

Yes. I mean I think when we look at the mix of consideration, we feel like it was the good balance between kind of using our balance sheet and giving a little bit of upside, right, for those in the business that will stay with the operations. And as we talk about on a go-forward basis, we'll continue to consider share repurchases as part of our capital allocation priorities. And we -- at 1.5x from a leverage perspective, we'll have the capacity to do that. So not ready to talk about kind of share counts as we get into kind of year-end, but it is going to be one of our considerations as we continue to move forward there.

Okay. And then as you put this into your P&L, what segment are you guys putting this in? I'm just trying to think about how to model it the right way and what that means for ASPs? Because I think when you look at the 2,000 roughly boats that they make every year and the projected revenue, we're looking at $115,000 unit average. So I just want to make sure I'm modeling that out right.

Yes. I think as we think about segment reporting, [ Kraken ] will be just a month into our Q3 and 4 months into our Q4. So we're evaluating the right segment reporting structure. Most likely, it rolls into potentially one of our current segments. But either way, we'll be sure to provide transparency so that you understand kind of how this should be modeled on a go-forward basis.

The next question will come from [ Mike Albanese ] at [indiscernible].

Obviously, some nice growth rates here. I think 50% of the business in Europe. So I was wondering if you could just comment on some of the demand trends you're seeing specifically in the North American markets for this type of category, the Scandinavian stay boats. I think there's a couple of other brands out there that have kind of been greenfielded as of late. So I'm just curious what you're seeing in the North American market versus Europe where it's -- the demand has been, I don't know, around longer.

Yes. Mike, like we said, Saxdor has about 33% of their volume here in the States. They run through MarineMax, a really great dealer who's doing a lot for the brand there. Registration has been up 378% over the last 2 years in the U.S. So when you look at the growth it's having here, we're just getting up to speed, keep in mind that everything has to get shipped over. So that's where we think working with our dealer partners that we start manufacturing boats over here, we can accelerate some of that share gain and get that growth up to what they're seeing outside of the U.S. right now.

Our next question today will come from Anna Glaessgen of B. Riley.

I guess I'd like to touch on the expectation for U.S. expansion. I guess, to what extent do you expect to leverage the current dealer base that you have in the U.S. with your legacy brands? And is there anything structural that would prevent expansion into the majority of your existing dealer network?

Yes. We're going to go through and evaluate that as we go forward. We have a partner already, like I said, in MarineMax. We're working with them on, as we go forward, what's our plan, how are we going to structure it and so on. These are bigger boats. It's kind of similar to the saltwater business where you have to have -- dealers have to have the infrastructure to be able to handle bigger boats and so on. So we're going to take a little bit of time here to make sure that we map that out correctly. And basically, our first opportunity is working with MarineMax as we go forward and seeing how we can maximize the support they need to grow the brand and really drive share in the U.S. market.

Great. And then I'd love your perspective, they do really well with the first-time boat buyer. Maybe what is drawing -- attracting the first-time buyer to that category and that brand specifically? And as you think longer term about the replacement cycle, would you expect them to stay within the category or potentially cross shop to your other brands?

Yes. I think the thing that draws first-time buyers, as we said, is the design structures of the boat, the versatility of the boat. The Saxdor team has been talking about it's like a living room on water, which allows it to be a really fun, relaxing, versatile boat. I think that's what attracts a lot of the people, the styling and so forth. As we go -- as we start to expand offerings and our current MBI legacy business, we think we have a pretty nice mix to offer consumers across the board, be it Saxdor, Cobalt, Pursuit, all the other Malibus, all the other products that we sell, brands that we sell. I think it lends itself for the right opportunities to grow our business here in the U.S. as well as globally, and that's why we're pretty excited about it. But that design that Sakari really has driven allows us to also look at our current models that we have in our legacy brands and start to look at how do we design boats more versatilely, how do we design boats a little edgier and so on. So we'll see where our future goes, but we're pretty excited about it.

Our next question will come from Noah Zatzkin of KeyBanc.

I guess on the international front, you mentioned, I guess, capacity being opened up in Europe via making Saxdor's in the U.S. And then I think you also touched on the fact that about 5% of the legacy business is international. So could this be an opportunity to expand the legacy brands internationally? And I guess, relatedly, how are you thinking about your approach to international and the unlocks that this deal gives you?

Yes. As we said, Noah, we do think that's an opportunity for us in multiple ways. On the international side, like we said, if we can relieve a little stress in the factories right now in Poland and Finland, that allows us to continue to increase volume. Right now, they're constrained in that manner. So moving Saxdor over to the U.S., that will be extremely helpful and help us, like we said, in our plants when we're currently running at 65% down at Fort Pierce. So that's the obvious one. The next one we got to work on is how do we take our brands in the U.S. over to Europe, where does it make sense to build them in the future, what's the capacity need to build them in the future, what's all the brand work, sales work, dealer work that needs to happen for those brands. That's what we're excited about. The infrastructure is already there, and we have to just make sure that we land the right plan, execute sharply and really drive that growth internationally with our current legacy brands. So we're excited about that. That's going to take a lot of work, but it's a great opportunity for us to unlock volume globally for the Cobalts, Pursuits, Malibus and MBG brands. And a lot of work in front of us, but pretty excited about the opportunities.

Our next question today will come from Griffin Bryan of D.A. Davidson.

Can you provide a little bit more color on the additional earn-out consideration of $84 million over '26 through '28? What do those operating, financial targets look like? And how would that additional capital be paid out?

This is David. We negotiated the flexibility to pay a portion of the earn-outs in either shares or stock, but we would expect to use cash depending on the balance sheet capacity and capital allocation priorities. And so we feel like with the way that we structured this, it's designed to retain and incentivize the management that's created this great business. And so we would be -- and the one thing I want to be clear about is we would be very happy to make those future earn-out payments. This becomes an even better economic outcome for MBI and our shareholders if Saxdor is hitting those performance targets.

Got it. And then are there any synergies that you're seeing here related to SG&A costs specifically?

Yes. I think from a synergy perspective, we're not thinking of this in the context of taking cost out of the business. I think we're thinking more from kind of opportunities from a manufacturing and operational perspective. For example, Kraken spends about $100 million in, call it, propulsion and other raw materials goods. And as we've been talking about with our centralized sourcing strategic initiatives, we think that's a real opportunity as we go forward. We're not going to provide specific synergy targets today, but we think that those opportunities are real, and we look forward to talk about them in the future.

Our next question today will come from Gerrick Johnson of Seaport Research Partners.

Of the 65% growth this past fiscal year, what -- how much of that came from the U.S. market?

How much of that came from the U.S. market? They were up -- I don't know the exact percent, David, but right now, 1/3 of it, I would say, by natural numbers, Gerrick, because that's what the volume that they've been doing. They've also done a lot more of the latest boat offerings that they just came to market with, with the 400 and the 460. They have not gotten to the States yet. So we've seen more kind of -- so it plays out that 2/3 Europe, 1/3 U.S. in that growth rate because some of those boats also haven't gotten here yet. So we just announced the 400 GTS at Miami and then the 460 will be debuted at PBIBS. So those boats are yet to hit the market. So more to come in the growth in the U.S.

Okay. So the 65% growth was evenly split between international and U.S., I could think of it that way.

Correct. Yes.

Okay. Now if you were to transition manufacturing to the United States to Fort Pierce, how long would that take?

Haven't laid out the plans in that. But when we look at building normal line, that we've gone through, that's a big undertaking that's normally within a 12-month period. So give or take, as we learn this boat and so forth, those are the larger boats that would come across as well. We have that capacity and that capability. We know how to do that. So we got to work out all the details. But normally, when you put up a normal line, it's usually a 12-month getting it all right, getting it laid out, doing your prototype builds and so on. So we would go with what we're normally used to and see how we adjust from there with the new Saxdor boats.

Okay. And then distribution in the United States, are you exclusive to MarineMax?

As we stand right now, we are exclusive to MarineMax.

And how long does that last for?

I'm not sure what the contract is on that one there, but we're working with MarineMax on what opportunities they see and what they want to do and how do we work together and how do we support -- how does MBI support them. So more to come on that one.

Okay. I'm not sure if I'm the last on Q&A here, but I'm going to throw one more in there. First-time buyers with income over $300,000, I mean, realistically, how big is that market?

Globally, I think it's a growing market. For us, it's an opportunity. We just got to make sure that we're hitting all the geographies and maximizing that. So we continue to look at where we can penetrate those types of buyers. And what's nice about this opportunity is we no longer just have to focus on the U.S. We can focus on global growth and find those buyers and be able to market to them and drive the excitement with our boats into their lifestyle. So we're pretty excited about it and continue to work on it.

This will conclude our question-and-answer session and also conclude the Malibu Boats conference call. We thank you for attending today's presentation, and you may now disconnect your lines.