Good morning and welcome to the Malibu Boats conference call to discuss second quarter fiscal year 2025 results. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time. 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. If you require operator assistance, please press star then zero. On the call today from management are Mr. Steve Menneto, Chief Executive Officer, and Mr. Bruce Beckman, Chief Financial Officer. I will now turn the call over to Mr. Beckman to get it started. Please go ahead. Thank you and good morning, everyone. Joining me on today's call is our CEO, Steve Menneto. On the call, Steve will provide commentary on the business, and I will discuss our second quarter of fiscal year 2025 financials. We will then open the call for questions. A press release covering the company's fiscal second quarter 2025 results was issued today, and a copy of that press release can be found in the investor relations section of the company's website. I also want to remind everyone that management's remarks on this call may contain certain forward-looking statements, including predictions, expectations, estimates, and other information that might 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 our filings with the SEC, and we encourage you to review our SEC filings for a more detailed description of these risk factors. Please also note that we will be referring to certain non-GAAP financial measures on today's call, such as Adjusted EBITDA, Adjusted EBITDA margin, Adjusted Fully Distributed Net Income, and Adjusted Fully Distributed Net Income per share. Reconciliations of these GAAP financial measures to non-GAAP financial measures are included in our earnings release. I will now turn the call over to Steve. Steve? Thank you, Bruce, and thank you all for joining the call. Our second fiscal quarter results came in slightly higher than expected during what has been a traditionally slower time of year. However, the broader retail marine market trends remain more challenging than we initially forecasted for the full year. While the quarter benefited from a favorable mix in our Malibu Axis segment and strong ASP performance, indicators of demand are below our original assumptions. During the quarter, we continued to navigate this challenging market environment, which we attribute largely to the muted retail demand driven by sustained interest rate pressures coupled with lagging effects on consumer purchases stemming from the hurricane season. As a result, the market is tracking down low double digits year to date, which is below the mid-single digit decline we had originally planned for. Retail softness is particularly evident in saltwater due to the lingering regional impacts in Florida. Overall, net sales in the quarter decreased by approximately 5.1% year-over-year due to our focus on maintaining modest production levels in line with lower channel inventories. Disciplined production and lower channel inventories will continue to be our focus for the remainder of the fiscal year as we prioritize dealer health and brand strength. Shifting to the early season boat shows, as many of you all know, these events provide important insights into customers' willingness to purchase new feature-rich models, and we had the opportunity to showcase our 2025 lineup across our brands. Dealer enthusiasm for these introductions reaffirmed our confidence in our commitment to staying on the leading edge of innovation, which continues to set us apart. Results in the early season shows have been decent but do not suggest a strong rebound in retail activity heading into the second half of the year. We will continue to watch closely as we head into the February Miami Boat Show for major signals within the saltwater segment and remain disciplined until we see firmer evidence of improvement in the market. Along with the early season shows, our Malibu Axis year-end sales event, a tradition we've maintained for 15 years, wrapped up earlier in the quarter. We were encouraged by the higher overall retail sell-through and good participation compared to last year, with moderating levels of promotional support required. This continues to underscore the strength of our brands and how they continue to resonate with customers in the current environment. However, it is important to note that while this activity is positive, many dealers focused on moving non-current units, a sign that inventory discipline remains top of mind across the channel. As we look ahead, we recognize that a sustained softening in the market, especially in saltwater, will likely continue in the second half of the fiscal year. While we do anticipate some seasonal lift, it is unlikely to lift the market enough to align with our original market assumption for a mid-single-digit decline for the year. Therefore, we are adjusting our outlook to reflect the reality of weaker retail trends, with top-line sales expected to be flat to down low-single-digits for the year and Adjusted EBITDA margins to reflect approximately 10%. As I stated earlier, our focus remains on maintaining dealer health and not prematurely ramping production without a clear path. Meeting demand as it materializes and preserving our brand position in the long term will set us up for success as we continue to monitor the retail environment. Overall, I am confident in our team's ability to weather these market conditions with our emphasis on dealer health and commitment to innovation and positioning us to thrive when demand normalizes. I will now turn the call over to Bruce for further remarks on the quarter. Thanks, Steve. Our results in the second quarter were slightly above our expectations. Net sales decreased 5.1% to $200.3 million, and unit volume decreased 11% to 1,222 units. The decrease in net sales was driven primarily by decreased unit volumes in the Malibu and Saltwater Fishing segments, resulting primarily from decreased wholesale shipments, partially offset by a favorable model mix in our Malibu and saltwater segments, and inflation-driven year-over-year price increases. The Malibu and Axis brands represented approximately 43% of unit sales, Saltwater Fishing represented 25.9%, and Cobalt made up the remaining 31.1%. Consolidated net sales per unit increased 6.6% to $163,900 per unit, primarily driven by a favorable model mix in the Malibu and saltwater segments and inflation-driven year-over-year price increases, partially offset by unfavorable segment mix. Gross profit decreased 0.2% to $37.4 million, and gross margin as a percent of sales was 18.7%. This represents an increase of 90 basis points compared to the prior year period. The increase in gross margin was driven by plant efficiencies and favorable model mix, more than offsetting volume deleverage, again demonstrating the resilience of our operations and our highly variable cost structure. Selling and marketing expenses increased 6.7% in the second quarter. The increase was driven primarily by an increase in certain personnel expenses and marketing events. As a percentage of sales, selling and marketing expenses increased versus the prior year by 30 basis points to 3%. General and administrative expenses increased 71.9%, or $11.1 million. This increase was driven primarily by an increase in legal fees and compensation-related expenses. As a percentage of sales, G&A expenses were 13.3%. GAAP net income for the quarter decreased 76.1% versus prior year to $2.4 million. Adjusted EBITDA for the quarter decreased 26.3% to $16.9 million, and adjusted EBITDA margin decreased to 8.4% from 10.9% in the prior year. Non-GAAP adjusted fully distributed net income per share decreased 45.6% to $0.31 per share. This is calculated using a normalized C Corp tax rate of 24.5% and a fully distributed weighted average share count of approximately 20.4 million shares. For a reconciliation of GAAP metrics to adjusted EBITDA and adjusted fully distributed net income per share, please see the tables in our earnings release. We continue to demonstrate the resilience of our business model, generating over $28 million in cash from operations in the quarter. Capital expenditures were $5.6 million, and we repurchased $10 million of stock in the quarter. In summary, our balance sheet continues to be strong, and we have ample liquidity to execute on our capital allocation priorities. Turning our attention to the full year, as Steve described, we continue to operate in a challenging retail environment with markets down double digits so far this year. We do not see a clear upward trend change that would enable us to maintain the market assumption of mid-single digit decline on which our original guidance was based. Given these dynamics, we are expecting the market to be down high single digits for the fiscal year, and we are adjusting our production levels accordingly to maintain the disciplined approach to managing dealer inventories. We continue to expect our dealers to remain focused on bringing inventory levels below historical ranges and continue to prioritize dealer health. With that said, we are updating our guidance. For the full fiscal year, we now expect sales to be flat to down low single digits year-over-year. Even with this modest revision in our full year guidance, we still expect to return to growth in the second half of the year as comparisons ease. As such, for Q3, we expect net sales to increase approximately 10% versus the prior year. We anticipate consolidated Adjusted EBITDA margin for the full fiscal year to be approximately 10%. For Q3, we expect Adjusted EBITDA margins of approximately 10%-12%. This will be the second consecutive year of calibrating channel inventory, and this will position our wholesale to track with retail when demand returns. We will keep a close eye on demand indicators and remain disciplined in our approach to production levels and dealer health, which will position us even stronger as the tide turns. Despite the near-term headwinds, our strong balance sheet, highly variable cost structure, and continued cash flow generation provide us with both stability and flexibility to help us weather tough market environments while continuing to execute on our capital allocation priorities. With that, I'd like to open up the call for questions. As a reminder, to ask a question, you will need to press star then one on your touch-tone telephone. If your question has been answered or you wish to withdraw your question, please press star then two. Please stand by while we compile the Q&A roster. The first question comes from Craig Kennison with Baird. Please go ahead. Hey, good morning. Thanks for taking my questions. I wanted to start with Florida. I just wonder if there's a way to unpack the implications of hurricane activity in Florida. What's your overall exposure to that market? And I'm sure in near term there were some negative implications, and I'm wondering if there's any signal of replacement demand longer term. Yeah, thanks, Craig. Florida, as you know, is trying to recover, and some of the challenges we have down there, of course, are still rearing their heads. So when we look at the overall market in saltwater, total market across the U.S. is down low double digits. Florida has accelerated more than that for us. We do more than 50% of our saltwater businesses in Florida. So you could see that with that accelerated downtrend beyond the overall U.S. market, that's impacting us pretty heavily with us having such a concentration of business there. And I don't know, Steve, if you have any visibility into how replacement demand unfolds. I'm sure consumers down there have a lot of different priorities when it comes to their recovery, and a boat is not maybe the first thing on their mind. But what are you looking for a signal that, hey, there's replacement demand on its way? Yeah, I think, Craig, just from trying to get any type of indicators down there, it's hard to predict, as you said it. We don't see it coming back where there's this wholesale within one quarter we get this replacement volume. We know right now if you're trying to rebuild your docks, right, it's six months to eight months out to get a new dock replacement. Roofs are going back in and all the improvements that you're trying to make on your home that got affected. So just looking at how long it takes to get a dock back in, you got to get your dock before you get your boat. You got to go through the insurance. So there is a lot of steps before we start seeing replacement volume. And so we just kind of figure replacement volume will kind of come back, not in one big sharp moment, but it will come back over time. Thanks. I'll get back in the queue. The next question comes from Joe Altobello with Raymond James. Please go ahead. Thanks. Hey, guys. Good morning. So I guess first question on the guidance, your guide still implies second-half revenue growth here, call it in the mid-20s. And I think it also implies a modest improvement in market trends. I know the compares do get easier, but I guess my short question is, how much visibility do you have in that second-half number? Hi, Joe. It's Bruce Beckman. I think we have pretty good visibility for the third quarter given where orders stand. I think the question always becomes, what happens in that fourth quarter, which will really be predicated on what happens in the underlying market. As you noted, we will return to growth in the second half of the year. A lot of that relates to just how much the comparisons ease versus prior year. I mean, last year, we really saw a deceleration in our business in the third and fourth quarters. And so there's certainly that is a major factor. And then from a retail perspective, the retail market, there's still quite a bit of the retail activity that remains in this time of the year. It's probably about 60% of our retail activity is yet to take place here in the second half of the year. So there will still be some adjustments, I'm sure, that we'll need to make as we see the retail numbers play out. Okay. Understood. And maybe just to kind of shift gears on G&A, you mentioned it was up fairly significantly, and I think you mentioned a couple of things, including compensation. Maybe sort of unpack that a little bit and talk about the key drivers there and how should we think about SG&A spending this year? Yeah. So first of all, what I would say is the second quarter comparison was a very difficult comparison. Q2 of last year was the low water mark for G&A last year. And so there was some of the change that was driven by that comparison. We've seen higher levels of legal spend activity. I mean, if you look at the footnotes in our Q, you'll see us describing the legal activity. Certainly, that's elevated from where we've been historically, and we're looking forward to having that behind us. And then this year, from a compensation cost standpoint, we have incentive compensation this year that wasn't in the comparison period. So that's probably a larger driver. We expect that spend to normalize as we move forward. There's a number of these items that we would say are one-time in nature, particularly the legal expense and some of our employee kind of transition expenses. So we would expect it to moderate in the second half and trend down over time, more in line with our historical norms. Okay. Great. Thank you. The next question comes from Noah Zatzkin with KeyBanc Capital Markets. Please go ahead. Hey, thanks for taking my question. Maybe just one on the kind of broader industry. How are dealers feeling right now sentiment-wise, and how are you feeling about kind of the health of your dealer base? Thanks. Sure. So, retail, how the dealer's feeling, just actually talking to a few dealers over the last few weeks, actually cautiously optimistic is kind of the right phrase. As Bruce stated, about 60% of the retail left to happen. So they're feeling relatively good about the market. We just had our year-end sales event and some of the boat shows. And couple those together, they've been able to clear out inventories. They've been able to get retail activity moving without having to really overspend promo in a market where some of our competitors are still clearing out their inventories and have accelerated promo. So they're feeling good there. And then they appreciate us managing inventories and keeping production, the disciplined approach to production to help them get into the selling season. So we're looking forward to it, and we'll see what happens and how it unfolds here over the next two quarters. Great. And maybe I hate to ask the tariff question. I think you guys have fairly minimal exposure, but just any thoughts around potential tariff impacts and how you'd be able to mitigate that or just anything to share there? Thanks. Yeah. So we've done a preliminary look. I mean, as you can appreciate, there's not a lot of clarity on exactly what's going to happen. But based on where we stand in our fiscal year, based on what we believe our exposure is to be and our best guess of what the tariffs might be, we don't expect it to be material this year. And if that changes and there's something more for us to share with you, we certainly will. And I'm sure it'll be part of our fiscal year 2026 conversation. Great. Thank you. The next question comes from Brandon Rolle with D.A. Davidson. Please go ahead. Good morning. Thank you for taking my questions. First, just on the boat shows, could you dive in a little more on kind of what you're seeing in terms of demand by segment, maybe which segments are seeing stronger demand versus others? Sure. All right. And we'll dive in a little bit. In the saltwater, we had a really good FLIBS, Fort Lauderdale show. That was really good. But then you see when you move to Atlanta, maybe we were a little bit mixed in Atlanta. So you see some mixed signals there, but really strong coming out of Florida there on the freshwater. At the same time, Atlanta was a really good show. We had a good show in Minneapolis and Chicago, very strong, and a little bit mixed in New York for freshwater as well. So we're seeing those types of signals when it all adds up. That's why we said it was decent. There's a lot of things to be excited about as we move through, and there's a lot of things that you're kind of scratching your head going, "Why did that not materialize into a better result?" So overall, boat show activities, I think, have given the dealers that cautious optimism for when they get into the selling season. There's some opportunities to work with. Okay, and just on the inventory front, how much longer do you think we'll be in somewhat of a destocking phase if your current retail expectations play out over the next six-to-nine months? Brandon, I think you'll see the dealer sentiment change when the retail market changes. I think until then, they're going to be hunkered down, concerned about their cash flow, and concerned about their exposure. That's part of making sure that we keep it healthy will enable us to be well-positioned when the market turns to be able to take off from there. Okay. And just finally, on the saltwater market, your commentary around weakness there, is that just for your saltwater products, or do you feel like it's the larger saltwater industry as a whole that's seeing the weakness here early on in 2025? It's the whole industry that we're seeing, Brandon. That was what we were talking about. Yeah. Okay. Thank you. The next question comes from Mike Albanese with Benchmark. Please go ahead. Yeah. Hey, good morning, guys. Appreciate it. Brandon just actually asked my last question around saltwater, but I have another question here on ASPs. You saw some growth there. I'm just wondering if you can kind of frame how much of that was really driven by product mix versus just the annual cadence of price increases and really trying to get an idea if we're back to maybe that more normalized 3%-5% or if we're getting close to it or any way you can kind of dive into that and frame it would be helpful. Yeah. What I would say is mix has been a big driver of our ASP performance within our respective segments and overall. Price increases have been very modest this year, low single-digit range. So it's really more mixed. We expect the mix to moderate as we go forward just because last year we really pulled back on production on the Malibu Axis segment, and saltwater was a greater share of our mix last year in the second half than we expected to be this year. So that has a higher ASP per unit, so that will likely influence the back half. Okay. And then, just as a follow-up to that, I mean, how are you feeling aside from product mix, but just going back to the cadence of price increases? You said being modest, but you also talked about or made some positive commentary around some of the promotional activity you're seeing in your product. I mean, is it fair to think that as that moderates, you'd be able to kind of get back to stepping up the price increases? Or I guess the broader question is, is consumer affordability that much of an issue where you have to keep it at that low single digit? I think really. Second half. Yeah. I mean, I think in the near term, it's really going to be more about promotional levels of support. We expect to see moderating levels of promotional support, certainly for ourselves, and I think the industry over time, as the industry works through its inventory challenges. When the inventories get down to kind of where they need to be, then I think you'll see some of that promotional discounting go away. Our price increases over our strategy really has been to minimize those as much as possible and really just pass along inflation, which I think is pretty consistent with how others in the industry play it. We have to be concerned about the affordability headwinds in this market. Certainly. Appreciate it, guys. Thank you. Yep. The next question comes from Jaime Katz with Morningstar. Please go ahead. Hi. Good morning. Two quick ones. First, any color on Cobalt? It was It was the only segment that had unit growth. Is it just the consumer that's changed, or was it just better inventoried maybe than some of the other segments before the quarter? I mean, Cobalt has continued to kind of be a strong performer. I mean, we've seen good market share performance in that brand. We have a very good dealer network in that part of our business, and they've continued to execute quite well. And we have some exciting new models in that product line. Okay. And then we haven't really touched on borrowing, the lending environment with your lending partners, and maybe the quality of the borrowers. So any additional color to add there? Thank you. You mean on the consumers and their ability to access credit to purchase boats? Is that what you mean? Yes, sir. Yeah. We haven't seen so interest rates have come down some, I would say, from where they were at peak, but they haven't really moved that much recently with the Fed moves. So consumer rates, I would say, remain stubbornly high, which is part of the reason why the market has yet to rebound, in our opinion. But no increase in defaults or anything like that that you're hearing about? Not that we're seeing. No. Excellent. Thank you. I'm not showing any further questions at this time. This concludes today's conference call. Thank you for participating. You may now disconnect.