In a call with financial analysts recently, following the release of Brunswick Corp.’s third-quarter earnings, CEO David Foulkes was asked to rank the company’s guidance for 2020, giving a number between 1 and 10.
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“I would say that I’m very excited about the progress that we have made setting out for 2020, both on the inventory side, on some tailwinds on retail,” Foulkes said. “So, I’m very, very confident – let’s say 15 this time.”
Despite lower third-quarter sales in both its Boat Group and Marine Engine divisions, Foulkes said Brunswick has poised itself for growth next year, even if the marine market is flat or slightly down compared to 2019.
On the call, Brunswick executives said the growth will come through the expansion of 150-plus-hp Mercury outboards, a streamlining and consolidation of Boat Group operations that could yield double-digit profit margins as high as 20 percent, and the recent reducing of new-boat and sub-150-hp outboard inventories to dealers.
Foulkes told the analysts that he expects the growth to come without changes to its plans for expanding capacity at Mercury and Sea Ray. “And we have not adjusted any of our product development plans,” he said.
Brunswick CFO William Metzger said he expects to see “organic growth opportunities without any help from the market” next year in three areas. “It's growth in outboards as we bring new capacity online for the 175- to 300-hp engine family,” said Metzger. “We would expect to see more normal growth in the P&A business as weather normalizes next year. And we would expect to see a pop in wholesale.