Flowers Foods (FLO) Raymond James & Associates’ 46th Annual Institutional Investors Conference 2025 summary

Market environment and demand trends

• Marine industry demand remains soft, with new boat sales declining for four consecutive years and unit sales now below a 20-year average.

• Buyers are more unwilling than unable to purchase, often extending ownership cycles rather than trading in.

• Mixed results at recent boat shows, with some flat or positive outcomes but no clear signal of a strong rebound.

• Macroeconomic clarity and consumer confidence are more influential on demand than interest rates for affluent buyers.

• Tariffs and input costs are not expected to significantly impact boat pricing for model year '25; minor increases in fittings and accessories are anticipated.

Inventory, pricing, and promotional activity

• Inventory was reduced by 10% year over year in Q1, with expectations to maintain or slightly improve this by fiscal year-end.

• Inventory aging is at normal levels, with most carryover boats being newer models.

• Promotional activity has been above average for 12–18 months, supported by manufacturers, but is expected to normalize as inventories improve.

• Strategic pricing and inventory management have helped gain market share, even as margins declined due to promotional efforts.

Product mix, trade cycles, and used market

• Customers continue to prefer larger, more content-rich boats, with regional de-contenting only modestly successful.

• Trade cycles remain in the three to five-year range, with no significant increase in early exits or late model used boat influx.

• Used boat market has not seen a surge in late model trades; many buyers are more committed due to lifestyle changes like waterfront home purchases.