Good morning, and welcome to Malibu Boats' conference call to discuss the fourth quarter and full fiscal year 2025 results. On the call today from management are Mr. Steve Menneto, Chief Executive Officer, and Mr. Bruce Beckman, Chief Financial Officer. I'll now turn the conference call over to Mr. Beckman to get started. Please go ahead, sir.

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 an update on the new model year, and I will then discuss our fourth quarter and full year 2025 financials. We will then open the call for questions. A press release covering the company's fiscal fourth quarter and full year 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 or 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 these 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 and adjusted net income per share. Reconciliations of these GAAP financial measures to non-GAAP financial measures are included in our earnings release. Finally, during today's prepared remarks, comparisons are to Q4 of fiscal 2025, unless otherwise noted. I will now turn the call over to Steve.

Thanks, Bruce. Good morning, everyone. Fiscal year 2025 was a challenging period for the marine industry, shaped by a difficult retail environment and heightened tariff uncertainty. Despite these headwinds, I'm proud of our team's ability to navigate the landscape and deliver strong results for our customers and partners. We outpaced the market while remaining disciplined in protecting the health of our dealers, which remains a North Star for our organization. As a reminder, we led the charge, supporting our dealers' efforts to bring their inventory into alignment back in fiscal 2024. This set us up nicely for our outperformance of the market in fiscal year 2025, and we are well positioned to repeat that success in fiscal 2026. The organization is ready to execute despite a softer retail backdrop. At the same time, we continue investing in our people and kept our foot on the gas with innovation. We will be introducing 11 new model year '26 boats while maintaining our industry-leading commitment to quality and safety. I'm excited to share details on some of these new models with you in just a moment. In addition, we generated another strong year of free cash flow, producing $29 million. This consistent generation of free cash flow demonstrates both our discipline and the resilience of our business model regardless of the market conditions. As anticipated, we also reduced CapEx spending as we have the capacity in place to support the next upturn in retail demand when the market normalizes. And lastly, we executed on our capital allocation strategy, returning $36 million to shareholders through share repurchases. Turning to our dealers, as we noted in fiscal Q3, we expected dealers to continue trimming inventory. Elevated interest rates, ongoing macroeconomic uncertainty and the timing of trade policy changes weighed on consumer sentiment, which showed up in the softer industry retail data. Initial market data suggests that fiscal Q4 was the weakest quarter of the year, with the broader market down mid-teens percentage points. We remain committed to aligning wholesale with retail. Last year, when dealers faced higher inventory levels, we were one of the first in the industry to adjust production and increase promotional support. These proactive steps helped reduce noncurrent dealer inventory of our products, which allowed us to lower promotional spending in the back half of fiscal 2025. To be clear, we are still providing promotions to our network. The key distinction is that our promotions are now more normalized to a market consumer incentive rather than an aggressive inventory reduction. At our recent dealer meetings, we came away energized by the sentiment. Dealers appreciated our customer-first approach, ensuring products align with individual needs for a premier boating experience. We shared our new product lineup and the excitement building around it while also outlining plans to strengthen our role as a trusted dealer partner. This includes new tools to drive retail activity in the local markets and support long-term dealer success in fostering stronger relationships with our customers. We look forward to sharing more about these unique initiatives at our upcoming Investor Day next month. We have also made significant progress upgrading our dealer network. 2025 marked a turning point as we reset our Malibu and access network. With both liquidations behind us and new dealers in place, we are rebuilding our share in these affected markets and are proud of the quality and speed at which our new dealers have come online. While there is still work to do, onboarding has been smooth, and our new dealers are enthusiastic about providing industry-leading service and support to our customers in these important markets. Customer-centric innovation is central to our mission at MBI. As a market share leader, we are committed to delivering the most advanced boating technology and highest-quality products in the industry. Our model year '26 lineup sets a new standard in creativity, craftsmanship and performance, including 11 new models. Among the highlights are Cobia 245 center console and the 305 center console, which were unveiled at our National Dealer Meeting 3 weeks ago. These models are part of our strategy to upgrade the Cobia lineup, and we are excited to see that initial orders have exceeded expectations. Next, we have the Malibu 22 LSV and the newest evolution of our best-selling LSV series. Easy to tow, store and maneuver, the 22 LSV is the most complete compact wake boat ever built. We recently announced the Axis T250, the biggest, boldest and most powerful Axis in our history, with room for 18 to ride, relax and repeat. The T250 is an excellent option for value-focused buyers looking for outstanding quality at an affordable price point. And finally, the Pursuit S388, an evolution of one of our most popular models with more storage, premium upgrades and performance in a smart layout. We plan on unveiling 6 more new models across our portfolio in the coming months and will continue rolling out the all-new Monsoon engine with enhanced power, torque and efficiency. In addition to customer-centric innovation, our enterprise commitment to our communities remains paramount. Our mission is to deliver the ultimate on-the-water experience. And in doing so, we remain committed to safe boating and waterway health. We continue to educate customers on responsible boating and push the bounds of innovation with environmental impact in mind. Also, our long-standing history and involvement in MMMA and WSIA exemplifies our leadership role in the industry. And together with our industry advocates, we can take ownership in setting the standard for responsible and safe boating. Looking ahead, we are going to stay grounded in the realities of today's market, which is still feeling the effects of the broader macroeconomic uncertainties. With respect to the trade environment, tariffs will continue to create uncertainty in the general market. However, we anticipate a modest direct impact on our fiscal 2026 cost structure, estimated between 1.5% to 3% of cost of sales, assuming current tariff rates. We will remain proactive in mitigating impacts through our strategic supply chain management initiatives and leverage our robust vertically integrated U.S. manufacturing capabilities, all of which will balance the need for associated price increases. From a retail standpoint, we do expect to see gradual improvement in fiscal year 2026. We have not yet seen a clear inflection point that signals a return to growth for the overall industry. That is why we're going to remain disciplined, keeping our expectations aligned with what the market is telling us real-time and not get ahead of ourselves. Our dealer-first approach will continue to guide us, and our operational discipline will ensure we are in the right position when the market turns. We have the capacity in place, an exceptional team in the driver seat and a customer-centric product line that positions us to hit the throttle when the time comes. We are excited about the long-term opportunity ahead for MBI and for our industry. And as I mentioned, we look forward to sharing more at our Investor Day in September, where you will see how we are building on our strong foundation, innovating for the future and positioning ourselves to accelerate growth. We hope you can join us. With that, I'll turn it back to Bruce to discuss our financial results in more detail.

Thanks, Steve. In the fourth quarter, results were generally in line with our expectations. Net sales increased 30.4% to $207 million, and unit volume increased 16.8% to 1,221 boats. The increase in net sales was driven primarily by increased unit volumes in the Malibu segment, a favorable model mix across all segments and decreased promotional costs from elevated year-ago levels. The Malibu and Axis brands represented approximately 46.6% of unit sales. Cobalt represented 26.9% and Saltwater Fishing representing the remaining 26.5%. Consolidated net sales per unit increased 11.6% to $169,565 per unit, primarily driven by inflation-driven year-over-year price increases, decreased promotional costs and favorable model mix. Gross profit increased 162.1% to $32.7 million, and gross margin was 15.8%. This compares to a gross margin of 7.9% in the prior-year period. The increased gross margin was driven by decreased promotional costs across all segments and favorable model mix. Selling and marketing expenses increased 10.7% to $5.4 million. The increase was driven primarily by an increase in compensation and higher marketing activity. As a percentage of sales, selling and marketing expenses decreased 50 basis points to 2.6%. General and administrative expenses decreased 12.7% to $18.8 million. The decrease was driven primarily by a decrease in legal and professional fees and a one-time IT item in the comparable period. As a percentage of sales, G&A expenses were 9.1%. Q4 adjusted EBITDA increased to $19.7 million, and Q4 adjusted EBITDA margin increased 1,210 basis points to 9.5%. Q4 GAAP net income increased to $4.8 million. In an effort to evolve and simplify our financial metrics, we have replaced the adjusted fully distributed net income per share metric with adjusted net income per share. In the fourth quarter, adjusted net income per share increased by 205% to $0.42 per share. This is calculated using a normalized tax rate of 24.5% and a weighted average share count of approximately 19.3 million shares. For a reconciliation of adjusted EBITDA and adjusted earnings per share to GAAP metrics, please see the tables in our earnings release. Turning our attention to cash flow, we generated $14.3 million of free cash flow during Q4, inclusive of $7 million of capital expenditures. We repurchased $5.6 million of stock in the quarter. Now to recap our results for all of fiscal 2025, net sales decreased 2.6% to $807.6 million, and unit volume decreased 9% to 4,898 boats. Consolidated net sales per unit increased 7.1% to $164,876 per unit, driven by a favorable model mix and inflation-driven year-over-year price increases. Gross profit decreased 2% to $144.1 million. GAAP net income for the year was $15.2 million compared to a loss of $56.4 million in the prior year. And adjusted EBITDA decreased 9.1% to $74.8 million. Adjusted EBITDA margin decreased by 60 basis points to 9.3%. As you may have noticed this morning, we have provided additional segment-level detail in our press release and filings. For context, we have also moved several corporate expenses from the Malibu Access segment to the corporate expenses and other line item to better reflect our operating structure. A historical recast was also provided in the 10-K and will be filed later today. Adjusted EBITDA margin for the Malibu segment increased to 19.4% for fiscal year 2025 from 15.3% in fiscal 2024. For the same periods, adjusted EBITDA margin for the Saltwater Fishing segment decreased to 9.5% from 10.8% and adjusted EBITDA margin for the Cobalt segment decreased to 8.3% from 10.2%. For the year, non-GAAP adjusted earnings per share decreased 21.4% to $1.58 per share. This is calculated using a normalized tax rate of 24.5% and a weighted average share count of approximately 19.7 million shares. For the year, free cash flow was $28.9 million, inclusive of $27.9 million of CapEx and proactive raw material purchases in advance of increased tariff rates. We executed our capital allocation priorities by returning $35.9 million to shareholders through share repurchases, and we finished the year with $19 million of net cash on the balance sheet and over $300 million of untapped liquidity on our credit facility. Our balance sheet strength and ample liquidity gives us the confidence in our ability to support growth and innovation through every phase of the market cycle. As we enter the new year, as Steve mentioned earlier, we will take a pragmatic approach to our fiscal year 2026 guide. Market softness resulted in modestly higher-than-anticipated dealer inventory levels at year-end, and macro uncertainty remains a key headwind in tempering retail demand. While we envision an improvement from the market declines we experienced in Q4, we have yet to see the likely catalyst for material inflection in the market. As such, our guide today is anchored in the expectation that our markets will decline in the range of mid- to high single digits for the year. This will be characterized by a continuation of high single-digit to low double-digit decline through the first half of the year, with some improvement projected towards the back half. If the market proves to be more favorable, we are well positioned to serve stronger demand and exceed our pace of outperformance. Based on our current market outlook and operating plans, our expectations for the fiscal year 2026 are as follows: We anticipate year-over-year net sales to be flat to down mid-single-digit percentage points. For Q1, we expect net sales to be up high single digits. We expect consolidated adjusted EBITDA margins ranging from 8% to 9% for the fiscal year. For Q1, we expect adjusted EBITDA margins between 5% to 6%. This guidance incorporates the expected increased tariff costs and associated mitigations, including pricing. To conclude, in fiscal 2025, we executed our strategy, outpaced the market and delivered strong free cash flow despite a challenging external environment. We have demonstrated industry leadership and prioritizing the health of our dealer network and are strategically positioned to capitalize on higher demand when the market returns to growth. We expect 2026 to be another year of top line outperformance against the markets in which we compete, and our resilient business model will again enable us to generate strong free cash flow to fund our capital allocation priorities. We are excited about our company's future and look forward to sharing our plans for growth and value creation at our upcoming Investor Day.

Our first question today comes from Joe Altobello from Raymond James.

This is Martin on for Joe. I wanted to quickly touch on sort of inventory levels, which I believe you said were elevated at year end. Just trying to get an idea of how much is that we expect further destocking this year. And sort of is it across the board? Or is it mostly in the Saltwater and Cobalt segments?

Yes. What I would say is it's across the board, it's not in any one given segment. I think all the segments were affected by the macroeconomic uncertainty that we experienced. And it's not a, I would say, a large amount of excess inventory, it's more modest, it's in the 1 to 2 weeks range. But certainly something as we maintain our focus on dealer health and dealer inventories, is something that we are going to address in our fiscal '26 guidance.

Great. And I just want to really quickly touch on tariffs and how that might affect pricing. Will that just go directly into MSRP? Or could you be looking at a surcharge?

We haven't necessarily decided on exactly which mitigation and how exactly we're going to mitigate it. We're looking at multiple forms of mitigation from supply chain strategies, changing sourcing patterns and a number of potential mitigations in an attempt to minimize the need for price increases. But we have incorporated to get that increase in cost and into our guidance.

Our next question comes from Eric Wold from Texas Capital Securities.

I have a quick clarification question regarding your guidance, and then a follow-up. First, does your guidance take into account any interest rate cuts for the fiscal year? Also, should we expect to see some interest rate relief this fall as is now commonly expected? You mentioned that you're easing up on promotions and discounts. If there is some interest rate relief around the boat show, would you anticipate an increase in promotions to stimulate demand during this crucial boat show season, so customers don't miss out? Finally, based on your conversations with dealers, how much rate relief do you think payment buyers need right now to enhance affordability in your key segments?

Thank you for your question. Our guidance does not include any rate cuts. Regarding how our dealers are feeling and our promotional strategies, we are currently in a phase where consumer discounts are normalizing as we reduce inventory. We are focused on ensuring we capture every possible sale to increase our market share. We have introduced about 5 out of the 11 new models, and more are on the way, which should assist us during the boat show season. Additionally, if there are any rate cuts, that could give us a boost during this important time.

Yes, I agree with what Steve mentioned. There will likely be a delay between a Federal Reserve rate cut and the impact on consumer financing rates. We will benefit immediately from floor plan financing, which will assist both our dealers and us, but it may take some time for this to have a broader effect. We believe that lowering consumer rates will be a crucial factor in driving growth in this industry. We've noticed that payment buyers have reduced their activity and have not yet returned to the market. We are looking forward to the time when these buyers re-enter the market, as that will likely contribute to the industry's return to growth.

And our next question comes from Craig Kennison from Baird.

Wanted to understand the retail outlook that is embedded in your fiscal '26 guidance.

I think the easiest way, Craig, is to think about it is at this point, we're kind of seeing more of the same. There's nothing that says there's going to be this wild ride up yet that we're at the beginning of the next up cycle. So we've kind of looked at it and positioned it as more of the same. So it's still the focus on how do we gain share in a mid-single to upper single digit down market. So we're going to be focused on the new products, how do we work with our dealers to be better retailers and what we can do to support that. So that's kind of where we continue to see the market until we see some point that says, "Hey, this thing is going to turn for the better."

If you were to summarize it, Craig, we're kind of expecting next year to play out very similarly to the way this year played out. And if there's an inflection change in the market, we'll be ready to capitalize on that inflection change. But as of right now, it's probably more prudent to assume it's going to be similar to last year.

Got it. That's helpful. And so fiscal '25 included retail being down, but then also some destocking activity. Would you say you would also expect, again, you made the comment on retail, but then you would also reduce inventory in the channel?

Exactly, yes. And it would likely be a little bit more destocking than we had this year because again, we've got a little bit heavier coming into the year than we would have anticipated 3 months ago just because of how soft retail was in Q4.

Got it. That's helpful. And then just thinking about your dealer network, you've made some changes and upgrades. Does that have any impact on your stocking plans? Or is it fairly immaterial, given the size of your whole network?

I would say it's fairly immaterial, Craig.

Our next question comes from Noah Zatzkin from KeyBanc Capital Markets.

I guess first, just hoping you could kind of comment on the health of the dealer base, both for you guys and for the broader industry. And then in terms of inventory levels, like what's your sense of, from an industry perspective, how inventory levels are?

Yes. From the health of our dealer network, and I think we've said this on an ongoing basis, we check in with our floor plan supplier every month, we have our fingers on the pulse of what's going on. They're pretty healthy, no big issues. However, as Bruce stated, with the softer Q4, maybe 1 or 2 weeks heavier than inventory than we wanted. And as we kind of look at '26, we want to be prudent and making sure we continue to stay disciplined to watching our dealer health. So I think our MBI dealers are in good shape. Like any other manufacturer, we'll have a pocket here or there that we're always cleaning up regionally or so forth. So always got our eye on that. Industry-wise, I think the overall industry got better in inventory. I know some of our competitors are still working through, we were the first ones to kind of go. So there's still some folks working through their inventory challenges. But we're going to remain disciplined and continue to have that finger on the pulse to really support our dealers.

The other thing I would add to that is just the level of noncurrent in the system for us is in a healthy spot and better than what we understand the industry to be. So we feel good about that. And again, that's, I think, a result of the focus that we've put on dealer health.

Got it. Very helpful. And maybe just one more question about your approach to pricing. If I’m correct, you mentioned that the tariffs would add about 1.5 to 3 points to additional cost of goods sold. How are you considering offsets, if any, in your guidance regarding these extra costs? Also, it would be great if you could share any mitigation efforts or opportunities you might have.

So maybe the first thing I'll say is that some of the mitigation activity took place in last fiscal year, where we did some advanced purchases. We had roughly $10 million of additional working capital on the balance sheet at the end of the year that we wouldn't have had, had it not been for those advanced purchases. So that was, I would say, mitigation, number one. And then we have a number of supply chain efficiency initiatives underway, we always do. And those, we expect to help us. And then we likely will have some price increases that will be necessitated by these additional costs, and those have been factored into the guidance that we have provided.

And our next question comes from Jaime Katz from Morningstar.

I did notice there was some long-term debt on the balance sheet this morning. I'm not sure that is the change in how you guys are thinking about capitalizing the balance sheet or if there was something else I missed. But can you talk to that first?

No. There's no long-term change, Jaime. I mean we have a credit facility. And from time to time, we pull on that credit facility to be able to ensure that we have the working capital to run our business. We ended up in a good spot from a net cash position. I mean, we have $19 million of net cash. So still strong positive cash. And that's after returning $36 million to shareholders in the form of share repurchases. So no change in the strategy there.

Okay. And then I understand we're in this really difficult period. But could you give us or walk us through maybe a sensitivity analysis on how we get back to a double-digit EBITDA margin? What sort of sales growth would we need to get there? And has the promotional cadence changed as we have gone through the last 2 months, I guess? Or does that give us some hope that maybe there is some upside to the initial EBITDA margin we're looking at for the year ahead?

Well, maybe the first thing I'll say, Jaime, is that if we can get the market to stabilize, then we no longer have to destock to keep the dealers healthy from a weeks-on-hand standpoint. So we've been in the process of destocking now for the last 2 fiscal years. It would be great if we could get that in the rearview mirror, and that alone would allow us to post a revenue unit, stabilize our units and allow us to drive revenue and profit growth. So that would be the first thing. We have seen promotions, I would say, normalize, where you see the spike in promotional activity is when there is a high level of dealer inventories, noncurrents, and there's problems to be cleaned up. And that's not just for us, it's for the industry. And as Steve mentioned, the industry is getting healthier. So I think that will help the industry normalize those promotions going forward. And then, of course, I mean, we are undershipping as an industry kind of the long-term kind of replacement level of units for the industry. So this industry will bounce back. And when it does, we have the capacity and the team in place to be able to support that next upturn in the market. Steve...

Go ahead.

No, go ahead.

I was curious to, like as you go through this, I don't think there was anything mentioned about like CapEx spend this year and whether you guys are still constraining that or maybe constraining it more, given where we are?

Well, I mean, I think last year, we gave guidance of $30 million to $35 million, and we finished below that level in fiscal '25. So we have been very disciplined and prudent in those capital investment levels. And again, that's well below where we were in the prior year because we've completed our capacity expansions and we have that capacity in place. So I would say, this year, we're expecting similar levels to what we had last year, which is, again, a more normalized post-capacity expansion level of CapEx.

And ladies and gentlemen, with that being our final question, I would like to conclude today's conference call. Thank you for participating. You may now disconnect your lines.