Brunswick Corporation (NYSE:BC) Q1 2018 Earnings Conference Call - Preliminary Transcript

Apr 26, 2018 • 11:00 am ET

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Brunswick Corporation (NYSE:BC) Q1 2018 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good morning and welcome to Brunswick Company's 2018 First Quarter Earnings Conference Call. All participants will be in a listen-only mode until the question-and-answer period. Today's meeting will be recorded. If you have any objections, you may disconnect at this time.

I'd now like to introduce Ryan Gwillim, Vice President-Investor Relations.

Executive
Ryan M. Gwillim

Good morning and thank you for joining us. On the call this morning are Mark Schwabero, Brunswick's Chairman and CEO; and Bill Metzger, CFO.

Before we begin with our prepared remarks, I would like to remind everyone that during this call, our comments will include certain forward-looking statements about future results. Please keep in mind that our actual results could differ materially from these expectations. For the details of the factors to consider, please refer to our recent SEC filings and today's press release. All of these documents are available on our website at brunswick.com.

During our presentation, we'll be referring to certain non-GAAP financial information. Reconciliations of GAAP to non-GAAP financial measures are provided in the reconciliation sections of the consolidated financial statements accompanying today's results.

As a reminder, on December 5 of last year, we announced our intention to sell our Sea Ray businesses, including the Meridian brand. Starting with the fourth quarter of 2017, we are reporting the historical and future results of these businesses as discontinued operations. Therefore, for all periods presented in this release, all figures and outlook statements incorporate this change and reflect continuing operations only, unless otherwise noted.

I would now like to turn the call over to Mark.

Executive
Mark D. Schwabero

Thank you, Ryan, and good morning, everyone. Our first quarter performance was an excellent start to what we believe will be another year of successful execution of our strategy and the creation of shareholder value. Our marine businesses continue to benefit from strong demand for outboard boats and engines, successful new products, and our strategy to grow the parts and accessories businesses. As a result, our marine businesses had revenue growth of 8% in the quarter, with a very strong increase in operating earnings versus our first quarter of 2017.

At this point in the marine season, our current outlook for the global marine market remains in line with our initial expectations. While unfavorable weather conditions in certain markets, including the Northeast and Midwest regions of the US and Europe, have contributed to a slightly lower start to boating activity and the marine retail selling season.

Based upon feedback from our boat shows, dealer sentiments, reaction to new product offerings across the industry, the favorable replacement cycle dynamics and positive global macroeconomic conditions, we remain confident in our view of the industry for 2018. We continue to focus on product leadership as evidenced by Mercury's launch of the 175 horsepower to 225 horsepower V6 outboard engines, the first in a series of major outboard engine launches planned for 2018. These products, which will begin shipping in the second quarter, along with other award-winning, new products within our other marine categories, respond to the customers'