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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________________________________________________
FORM 10-Q
________________________________________________________
þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2024
or
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________
Commission file number: 001-39213
OneWater Marine Inc.
(Exact name of registrant as specified in its charter)
Delaware83-4330138
(State or other jurisdiction of incorporation or organization)(IRS Employer Identification No.)
6275 Lanier Islands Parkway
Buford, Georgia
30518
(Address of principal executive offices)(Zip code)
(Registrant’s telephone number, including area code): (678) 541-6300
________________________________________________________
Securities registered pursuant to Section 12(b) of the Exchange Act:
Title of Each ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Class A common stock, par value $0.01 per shareONEWThe Nasdaq Global Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.x Yes o No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). x Yes o No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated fileroAccelerated filer x
Non-accelerated fileroSmaller reporting companyo
 Emerging growth companyo
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes x No
The registrant had 16,028,219 shares of Class A common stock, par value $0.01 per share, and 284,896 shares of Class B common stock, par value $0.01 per share, outstanding as of January 24, 2025.



ONEWATER MARINE INC.
FORM 10-Q
FOR THE QUARTER ENDED DECEMBER 31, 2024
TABLE OF CONTENTS
Page

2


CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
The information in this Quarterly Report on Form 10-Q includes “forward-looking statements.” All statements, other than statements of historical fact included in this Quarterly Report on Form 10-Q, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. When used in this Quarterly Report on Form 10-Q, the words “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on our current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under the headings “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business” included in our Annual Report on Form 10-K for the year ended September 30, 2024, filed with the U.S. Securities and Exchange Commission (the “SEC”) on December 10, 2024, and under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report on Form 10-Q. These forward-looking statements are based on management’s current belief, based on currently available information, as to the outcome and timing of future events.
Forward-looking statements may include statements about:
general economic conditions, including changes in employment levels, rates of inflation, consumer demand, preferences and confidence levels, fuel prices, levels of discretionary income, and consumer spending patterns;
economic conditions in certain geographic regions in which we primarily generate our revenue;
credit markets and the availability and cost of borrowed funds;
our business strategy, including acquisitions and Dealership same-store growth;
our ability to integrate acquisitions or conduct dispositions;
competition;
our ability to maintain our relationships with manufacturers, including meeting the requirements of our dealer agreements and receiving the benefits of certain manufacturer incentives;
changes in industry seasonality and changes in demand for our products and our ability to maintain acceptable pricing for our products and services, including financing, insurance and extended service contracts;
effects of an inflationary environment on the cost of the products we sell and personnel and other expenses that are incurred within our operations;
our ability to finance working capital and capital expenditures;
our operating cash flows, the availability of capital and our liquidity;
our future revenue, Dealership same-store sales, income, financial condition, and operating performance;
our ability to sustain and improve our utilization, revenue and margins;
seasonality and inclement weather such as hurricanes, tornadoes, other severe storms, fire and floods, generally and in certain geographic regions in which we primarily generate our revenue;
any potential tax savings we may realize as a result of our organizational structure;
our future operating results and profitability; and
plans, objectives, expectations and intentions contained in this Form 10-Q that are not historical.

3


We caution you that these forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. Should one or more of the risks or uncertainties occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements. These risks include, but are not limited to:
decline in demand for our products and services;
the seasonality and volatility of the boat industry;
general domestic and international political and regulatory conditions, including changes in tax or fiscal policy;
environmental conditions and real or perceived human health or safety risks;
our acquisition strategies and our ability to integrate additional marine retailers;
effects of industry-wide supply chain challenges and our ability to manage our inventory;
any global public health concerns, including, for example, our ability to safely operate our locations, access to inventory, and customer demand;
our ability to retain key personnel and the effects of labor shortages;
the inability to comply with the financial and other covenants and metrics in our credit facilities;
cash flow and access to capital;
the timing of development expenditures; and
the other risks described under “Risk Factors” and discussed elsewhere in our Annual Report on Form 10-K for the year ended September 30, 2024 and discussed elsewhere in this Quarterly Report on Form 10-Q.
All forward-looking statements, expressed or implied, included in this Quarterly Report on Form 10-Q are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.
Any forward-looking statement that we make in this Quarterly Report on Form 10-Q speaks only as of the date of such statement. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.

4


PART I – FINANCIAL INFORMATION
Item 1.    Condensed Consolidated Financial Statements (Unaudited)
ONEWATER MARINE INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except par value and share data)
(Unaudited)
December 31,
2024
September 30, 2024
ASSETS
CURRENT ASSETS:
Cash$22,711 $16,849 
Restricted cash13,847 10,488 
Accounts receivable, net56,912 73,269 
Inventories636,676 590,838 
Prepaid expenses and other current assets67,328 85,922 
Total current assets797,474 777,366 
Property and equipment, net91,499 93,224 
Operating lease right-of-use assets136,275 138,829 
Other long-term assets4,911 1,299 
Deferred tax assets, net41,154 37,278 
Intangible assets, net203,631 205,391 
Goodwill336,602 336,602 
Total assets$1,611,546 $1,589,989 
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable$29,266 $32,106 
Other payables and accrued expenses38,055 42,116 
Customer deposits53,454 63,955 
Notes payable – floor plan490,107 443,386 
Current portion of operating lease liabilities15,752 15,704 
Current portion of long-term debt, net15,672 7,874 
Current portion of tax receivable agreement liability2,578 2,578 
Total current liabilities644,884 607,719 
Other long-term liabilities9,105 12,563 
Tax receivable agreement liability38,019 38,019 
Long-term operating lease liabilities123,330 126,001 
Long-term debt, net412,590 414,934 
Total liabilities1,227,928 1,199,236 
COMMITMENTS AND CONTINGENCIES (Note 15)
STOCKHOLDERS’ EQUITY
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued and outstanding as of December 31, 2024 and September 30, 2024
  
Class A common stock, $0.01 par value, 40,000,000 shares authorized, 14,847,008 and 14,686,696 shares issued and outstanding as of December 31, 2024 and September 30, 2024, respectively
148 147 
Class B common stock, $0.01 par value, 10,000,000 shares authorized, 1,429,940 shares issued and outstanding as of December 31, 2024 and September 30, 2024
14 14 
Additional paid-in capital203,267 202,921 
Retained earnings147,654 159,625 
Accumulated other comprehensive income (loss)3,694 (1,897)
Total stockholders’ equity attributable to OneWater Marine Inc.354,777 360,810 
Equity attributable to non-controlling interests28,841 29,943 
Total stockholders’ equity383,618 390,753 
Total liabilities and stockholders’ equity$1,611,546 $1,589,989 

5


ONEWATER MARINE INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except per share data)
(Unaudited)
Three Months Ended
December 31,
20242023
Revenues:
New boat$247,997 $241,084 
Pre-owned boat56,798 53,283 
Finance & insurance income9,400 7,360 
Service, parts & other61,619 62,286 
Total revenues375,814 364,013 
Cost of sales:
New boat211,121 196,403 
Pre-owned boat45,582 41,346 
Service, parts & other35,057 34,821 
Total cost of sales291,760 272,570 
Selling, general and administrative expenses79,060 79,599 
Depreciation and amortization5,315 4,222 
Transaction costs559 579 
Change in fair value of contingent consideration242 572 
Restructuring and impairment851  
(Loss) income from operations(1,973)6,471 
Other expense (income):
Interest expense – floor plan7,026 7,812 
Interest expense – other8,988 9,152 
Other expense (income), net887 (247)
Total other expense, net16,901 16,717 
Net loss before income tax benefit(18,874)(10,246)
Income tax benefit(5,262)(2,276)
Net loss(13,612)(7,970)
Net (income) attributable to non-controlling interests  (119)
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC1,641 919 
Net loss attributable to OneWater Marine Inc.$(11,971)$(7,170)
Net loss per share of Class A common stock – basic$(0.81)$(0.49)
Net loss per share of Class A common stock – diluted$(0.81)$(0.49)
Basic weighted-average shares of Class A common stock outstanding14,83114,540
Diluted weighted-average shares of Class A common stock outstanding14,83114,540

6


ONEWATER MARINE INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands)
(Unaudited)
For the Three Months Ended
December 31,
20242023
Net loss$(13,612)$(7,970)
Other comprehensive income (loss):  
Foreign currency translation adjustment20 (9)
Change in fair value of interest rate swaps, net of reclassification adjustment7,289  
Income tax expense associated with other comprehensive income items(1,179) 
Comprehensive loss(7,482)(7,979)
Net (income) attributable to non-controlling interests (119)
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC1,641 919 
Foreign currency translation adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC(2)1 
Change in fair value of interest rate swaps, net of reclassification adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC(640) 
Income tax expense associated with other comprehensive income items attributable to non-controlling interest of One Water Marine Holdings, LLC103  
Comprehensive loss attributable to OneWater Marine Inc.$(6,380)$(7,178)

7


ONEWATER MARINE INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands)
(Unaudited)
Class A Common StockClass B Common Stock
SharesAmountSharesAmountAdditional Paid-in
Capital
Retained EarningsNon-controlling InterestAccumulated Other
Comprehensive Income
(Loss)
Total Stockholders’
Equity
Balance at September 30, 202414,687$147 1,430$14 $202,921 $159,625 $29,943 $(1,897)$390,753 
Net loss— — — — — (11,971)(1,641)— (13,612)
Shares issued upon vesting of equity-based awards, net of tax withholding160 1 — — (1,824)— — — (1,823)
Equity-based compensation— — — — 2,170 — — — 2,170 
Currency translation adjustment— — — — — — 2 18 20 
Change in fair value of interest rate swaps, net of reclassification adjustment and $1.2 million tax expense
— — — — — — 537 5,573 6,110 
Balance at December 31, 202414,847$148 1,430$14 $203,267 $147,654 $28,841 $3,694 $383,618 

Class A Common StockClass B Common Stock
SharesAmountSharesAmountAdditional Paid-in
Capital
Retained EarningsNon-controlling InterestAccumulated Other
Comprehensive Income
(Loss)
Total Stockholders’
Equity
Balance at September 30, 202314,420 $144 1,430 $14 $193,018 $165,432 $55,469 $1 $414,078 
Net loss— — — — — (7,170)(800)— (7,970)
Distributions to members— — — — —  (3,789)— (3,789)
Purchase of non-controlling interest— — — — 716 — (19,556)— (18,840)
Shares issued upon vesting of equity-based awards, net of tax withholding124 1 — — (1,553)— — — (1,552)
Equity-based compensation— — — — 2,392 — — — 2,392 
Currency translation adjustment— — — — — — (1)(8)(9)
Balance at December 31, 202314,544 $145 1,430 $14 $194,573 $158,262 $31,323 $(7)$384,310 
8


ONEWATER MARINE INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
For the Three Months Ended December 3120242023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss$(13,612)$(7,970)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization6,037 4,905 
Equity-based awards2,170 2,392 
Loss (gain) on asset disposals183 (34)
Non-cash interest expense933 484 
Deferred income tax provision(5,056)1,828 
Change in fair value of contingent consideration242 572 
(Gain) loss on equity investment (7)112 
(Increase) decrease in assets:
Accounts receivable16,357 20,240 
Inventories(45,798)(97,223)
Prepaid expenses and other current assets19,468 (12,388)
Other assets(880)(1,869)
Increase (decrease) in liabilities:
Accounts payable(2,840)(8,216)
Other payables and accrued expenses(4,137)(12,196)
Customer deposits(10,502)(671)
Net cash used in operating activities(37,442)(110,034)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment and construction in progress(2,603)(4,924)
Proceeds from disposal of property and equipment189 59 
Cash used for additions to intangible assets(362)(428)
Proceeds from disposal of a business 45,100 
Net cash (used in) provided by investing activities(2,776)39,807 
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings from floor plan46,721 73,791 
Proceeds from long-term debt8,890 20,000 
Payments on long-term debt(3,434)(38,457)
Payments of debt issuance costs(935)(74)
Payments of tax withholdings for equity-based awards(1,823)(1,552)
Distributions to members (3,789)
Purchase of non-controlling interest (18,840)
Net cash provided by financing activities49,419 31,079 
Effects of exchange rate changes on cash and restricted cash 20 (9)
Net change in cash and restricted cash9,221 (39,157)
Cash and restricted cash at beginning of period27,337 93,310 
Cash and restricted cash at end of period$36,558 $54,153 
Supplemental cash flow disclosures:
Cash paid for interest$15,329 $16,480 
Cash (received) paid for income taxes and income tax refunds(330)455 
Noncash items:
Purchase of property and equipment funded by long-term debt 82 
Right-of-use assets obtained in exchange for new operating lease liabilities1,985 1,931 
9


OneWater Marine Inc. and Subsidiaries
Notes to the Condensed Consolidated Financial Statements
(Unaudited)
1.    Description of Company and Basis of Presentation
Description of the Business
OneWater Marine Inc. (“OneWater Inc”) was incorporated in Delaware on April 3, 2019 and was a wholly-owned subsidiary of One Water Marine Holdings, LLC (“OneWater LLC”). Pursuant to a reorganization on February 11, 2020 into a holding company structure for the purpose of facilitating an initial public offering (the “IPO”) and related transactions in order to carry on the business of OneWater LLC and its subsidiaries (together with OneWater Inc, the “Company”), OneWater Inc is the holding company and its sole material asset is the equity interest in OneWater LLC. OneWater LLC was organized as a limited liability company under the law of the State of Delaware in 2014 and is the parent company of One Water Assets & Operations (“OWAO”), and its subsidiaries.
The Company is one of the largest recreational marine retailers in the United States. The Company engages primarily in the retail sale, brokerage, and service of new and pre-owned boats, motors, trailers, the sale of marine parts and accessories, and offers slip and storage accommodations in certain locations. The Company also arranges related boat financing, insurance, and extended service contracts for customers with third-party lenders and insurance companies. As of December 31, 2024, the Company operates a total of 96 retail locations, 10 distribution centers/warehouses and multiple online marketplaces in 19 states, several of which are in the top twenty states for marine retail expenditures.
Operating results are generally subject to seasonal variations. Demand for products is generally highest during the third and fourth quarters of the fiscal year and, accordingly, revenues are generally expected to be higher during these periods. General economic conditions, including rising interest rates and consumer spending patterns, can negatively impact the Company’s operating results. Unfavorable local, regional, national, or global economic developments, global public health concerns, or uncertainties could reduce consumer spending and adversely affect the Company’s business. Consumer spending on discretionary goods may also decline as a result of lower consumer confidence levels, even if prevailing economic conditions are otherwise favorable. Economic conditions in areas in which the Company operates, particularly in the Southeast, can have a major impact on the Company’s overall results of operations. Local influences such as corporate downsizing, inclement weather such as hurricanes, tornadoes and other storms, environmental conditions, and other events have and could adversely affect the Company’s operations in certain markets and in certain periods. Any extended period of adverse economic conditions or low consumer confidence is likely to have a negative effect on the Company’s business.
Sales of new boats from the Company’s top ten brands represent approximately 45.7% and 48.9% of total sales for the three months ended December 31, 2024 and 2023, respectively, making them major suppliers of the Company. Of this amount, Malibu Boats, Inc., including its brands Malibu, Axis, Cobalt, Pursuit, Maverick, Hewes, Cobia and Pathfinder accounted for 13.1% and 13.6% of our consolidated revenue for the three months ended December 31, 2024 and 2023, respectively. As is typical in the industry, the Company contracts with most manufacturers under renewable annual dealer agreements, each of which provides the right to sell various makes and models of boats within a given geographic region. Any change or termination of these agreements, for any reason, or changes in competitive, regulatory, or marketing practices, including rebate or incentive programs, could adversely affect results of operations. Pre-owned boats are usually trade-ins from retail customers who are purchasing a boat from the Company.
Principles of Consolidation
As the sole managing member of OneWater LLC, OneWater Inc operates and controls all of the businesses and affairs of OneWater LLC. Through OneWater LLC and its wholly-owned subsidiaries, as well as majority-owned subsidiaries over which the Company exercises control, OneWater Inc conducts its business. As a result, OneWater Inc consolidates the financial results of OneWater LLC and its subsidiaries and reports non-controlling interests related to the portion of units of OneWater LLC (the “OneWater LLC Units”) not owned by OneWater Inc, which will reduce net income (loss) attributable to OneWater Inc’s Class A stockholders. As of December 31, 2024, OneWater Inc owned 91.2% of the economic interest of OneWater LLC.
Commencing December 31, 2021, the Company owned 80% of the economic interest of Quality Assets and Operations, LLC, over which the Company exercised control and the minority interest in this subsidiary was recorded accordingly. On October 31, 2023, the Company acquired the remaining 20% of the economic interest and, as a result, as of December 31, 2024 owned 100% of Quality Assets and Operations, LLC. See Note 4 for additional information regarding the acquisition.
Basis of Financial Statement Preparation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements, which do not include all the information and notes required by such accounting principles for annual financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with OneWater Inc’s Annual Report on Form 10-K for the year ended September 30, 2024. All adjustments, consisting of only normal recurring adjustments considered by management to be necessary for fair presentation, have been reflected in these unaudited condensed consolidated financial statements.
10


All intercompany transactions have been eliminated in consolidation. The Company operates on a fiscal year basis with the first day of the fiscal year being October 1, and the last day of the fiscal year ending on September 30.
2.    Summary of Significant Accounting Policies
Cash
At times the amount of cash on deposit may exceed the federally insured limit of the bank. Deposit accounts at each of the institutions are insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC). At December 31, 2024 and September 30, 2024, the Company exceeded FDIC limits at various institutions. The Company has not experienced any losses in such accounts and believes there is little to no exposure to any significant credit risk. Total cash and restricted cash shown in the unaudited condensed consolidated statements of cash flows is comprised of the amounts reported in cash and restricted cash on the unaudited condensed consolidated balance sheets.
Restricted Cash
Restricted cash relates to amounts collected for brokerage sales, in certain states, which are held in escrow on behalf of the respective buyers and sellers for future purchases of boats.
Inventories
Inventories are stated at the lower of cost or net realizable value. The costs of inventories consist of amounts paid to acquire the inventory, net of vendor consideration received and purchase discounts, and, varying by inventory type, may include the cost of reconditioning, equipment addition, transportation, material, labor and manufacturing overhead. The cost of the new and pre-owned boat inventory is determined using the specific identification method. In assessing lower of cost or net realizable value, the Company considers the aging of the boats, historical sales of a brand and current market conditions. The cost of acquired, manufactured and assembled parts and accessories is determined using methods which vary by subsidiary and include the average cost method, standard costs (which approximate average costs) and first-in, first-out (“FIFO”).
Goodwill and Other Identifiable Intangible Assets
Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Other identifiable intangible assets primarily consist of trade names, developed technologies, and customer relationships related to the acquisitions the Company has completed. The Company has determined that trade names have an indefinite life, as there are no economic, contractual or other factors that limit their useful lives and they are expected to generate value as long as the trade name is utilized by the Company, and therefore, are not subject to amortization. Developed technologies and customer relationships are amortized over their estimated useful lives of ten years. Goodwill and indefinite-lived intangible assets are accounted for in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, ‘‘Intangibles – Goodwill and Other’’ (‘‘ASC 350’’), which provides that the excess of cost over the fair value of the net assets of businesses acquired, including other identifiable intangible assets, is recorded as goodwill.
In accordance with ASC 350, Goodwill and indefinite-lived intangible assets are tested for impairment at least annually, or more frequently when events or circumstances indicate that impairment might have occurred. ASC 350 also states for annual impairment tests that if an entity determines, based on an assessment of certain qualitative factors, that it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is greater than its carrying amount, then a quantitative impairment test is unnecessary. The Company performs its annual test in the fiscal fourth quarter.
In accordance with FASB ASC 360-10, "Property, Plant and Equipment – Impairment or Disposal of Long-Lived Assets" (“ASC 360”), the Company assesses the potential for impairment of its definite-lived intangible assets if facts and circumstances, such as declines in sales, earnings, cash flows or adverse changes in the business climate, suggest that they may be impaired. Definite-lived intangible assets include developed technologies and customer relationships which are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.
Sales Tax
The Company collects sales tax on all of the Company’s sales to nonexempt customers and remits the entire amount to the states that imposed the sales tax. The Company’s accounting policy is to exclude the tax collected and remitted to the states from revenues and cost of sales.
Revenue Recognition
Revenue is recognized from the sale of products and commissions earned on new and pre-owned boats (including used, brokerage, consignment and wholesale) when ownership is transferred to the customer, which is generally upon acceptance by or delivery to the customer. At the time of acceptance or delivery, the customer is able to direct the use of, and obtain substantially all of the benefits. We are the principal with respect to revenue from new, pre-owned and consignment sales and such revenue is recorded at the gross sales price. With respect to brokerage transactions, we are acting as an agent in the transaction, therefore the fee or commission is recorded on a net basis.
11


Revenue from parts and accessories sold directly to a customer (not on a repair order) is recognized when control of the item is transferred to the customer, which is typically upon shipment. Revenue from parts and service operations (boat maintenance and repairs) is recorded over time as services are performed. Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements. Each boat maintenance and repair service is a single performance obligation that includes both the parts and labor associated with the service. Payment for boat maintenance and repairs is typically due upon the completion of the service, which is generally completed within a period of one year or less from contract inception. The Company recorded contract assets in prepaid expenses and other current assets of $4.3 million and $4.2 million as of December 31, 2024 and September 30, 2024, respectively.
Certain parts and service transactions require the Company to perform shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery). They are considered fulfillment activities and are included in selling, general and administrative expenses.
Revenue from storage and marina operations is recognized on a straight-line basis over the term of the contract as services are completed. Revenue from arranging financing, insurance and extended warranty contracts to customers through various third-party financial institutions and insurance companies is recognized when the related boats are sold. We do not directly finance our customers’ boat, motor or trailer purchases. We are acting as an agent in the transaction, therefore the commissions are recorded on a net basis. Subject to our agreements and in the event of early cancellation, prepayment or default of such loans or insurance contracts by the customer, we may be assessed a chargeback for a portion of the commission paid by the third-party financial institutions and insurance companies. We reserve for these chargebacks based on our historical experience with repayments or defaults. Chargebacks were not material to the unaudited condensed consolidated financial statements for the three months ended December 31, 2024 and 2023.
Contract liabilities consist of deferred revenues from marina and storage operations and customer deposits and are classified in customer deposits in the Company’s unaudited condensed consolidated balance sheets. Deposits received from customers are recorded as a liability until the related sales orders have been fulfilled by us and control of the vessel is transferred to the customer. The activity in customer deposits for the three months ended December 31, 2024 and 2023 is as follows:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Beginning contract liability$63,955 $51,649 
Revenue recognized from contract liabilities included in the beginning balance(38,408)(31,378)
Increases due to cash received, net of amounts recognized in revenue during the period27,907 30,706 
Ending contract liability$53,454 $50,977 
The following table sets forth percentages on the timing of revenue recognition for the three months ended December 31, 2024 and 2023.
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Goods and services transferred at a point in time92.6 %92.7 %
Goods and services transferred over time7.4 %7.3 %
Total Revenue100.0 %100.0 %
Income Taxes
OneWater Inc is a corporation and as a result, is subject to U.S. federal, state and local income taxes. We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events included in the consolidated financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the book value and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period in which the enactment date occurs. We recognize deferred tax assets to the extent we believe these assets are more-likely-than-not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations.
OneWater LLC is treated as a partnership for U.S. federal income tax purposes and therefore does not pay U.S. federal income tax on its taxable income. Instead, the OneWater LLC members are liable for U.S. federal income tax on their respective shares of the Company’s taxable income reported on the members’ U.S. federal income tax returns.
12


When there are situations with uncertainty as to the timing of the deduction, the amount of the deduction, or the validity of the deduction, the Company adjusts the financial statements to reflect only those tax positions that are more-likely-than-not to be sustained. Positions that meet this criterion are measured using the largest benefit that is more than 50% likely to be realized. Interest and penalties related to income taxes are included in the benefit (provision) for income taxes in the consolidated statements of operations.
Vendor Consideration Received
Consideration received from vendors is accounted for in accordance with FASB Accounting Standards Codification 330, ‘‘Inventory’’ (‘‘ASC 330’’). Pursuant to ASC 330, manufacturer incentives based upon cumulative volume of sales and purchases are recorded as a reduction of inventory cost and related cost of sales when the amounts are probable and reasonably estimable.
Derivative and Hedging Instruments
The Company utilizes derivative financial instruments to manage its interest rate risk. The types of risks hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. The Company documents the management strategy and assess hedge effectiveness at inception and throughout the term of the hedging relationship. Derivatives are reported at fair value on the accompanying unaudited condensed consolidated balance sheets.
The changes in fair value on the hedges is reported as a component of accumulated other comprehensive income (loss) on the accompanying unaudited condensed consolidated balance sheets, and reclassified to either interest expense – floor plan or interest expense – other in the accompanying unaudited condensed consolidated statements of operations based on the nature of the hedged transaction in the period during which the hedged transaction affects earnings. Cash flows from hedging instruments, including cash receipts and payments, are classified on the unaudited condensed consolidated statements of cash flows in the same category as the cash flows resulting from the item being hedged.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed periodically, and the effects of any revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant estimates made in the accompanying unaudited condensed consolidated financial statements include, but are not limited to, those relating to inventory mark downs, certain assumptions related to intangible and long-lived assets and valuation of contingent consideration.
Segment Information
We report our operations through two reportable segments: Dealerships and Distribution. The Dealership segment engages in the sale of new and pre-owned boats, arranges financing and insurance products, performs repairs and maintenance services, offers marine related parts and accessories and offers slip and storage accommodations in certain locations. The Distribution segment engages in the manufacturing, assembly and distribution primarily of marine related products to distributors, big box retailers and online retailers through a network of warehouse and distribution centers. Each reporting segment has discrete financial information and is regularly reviewed by the Company’s chief operating decision maker (“CODM”) to assess performance and allocate resources. The Company has identified its Chief Executive Officer as its CODM.
3.    New Accounting Pronouncements
In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which is intended to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2023, and interim periods within annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2025 and in interim reports during fiscal year 2026.
In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which is intended to improve the transparency, effectiveness and comparability of income tax disclosures by requiring greater disaggregation of information and additional disclosures. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement in fiscal year 2026.
13


In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which is intended to improve financial reporting by requiring disclosure of additional information about specific expense categories in the notes to the financial statements. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2028 and in interim reports during the fiscal year 2029.
Other than as noted above, there are no new accounting pronouncements that are expected to have a material effect on our consolidated financial statements.
4.    Acquisitions
There were no acquisitions during the three months ended December 31, 2024.
During the three months ended December 31, 2023, the Company exercised its right to acquire the remaining 20% economic interest in Quality Assets and Operations, LLC for consideration totaling $18.8 million. Subsequent to the acquisition, the Company now owns 100% of the economic interest in Quality Assets and Operations, LLC.
5.    Accounts Receivable
Accounts receivable primarily consists of trade accounts receivable, contracts in transit and manufacturer receivables. Trade receivables include amounts due from customers on the sale of boats, parts, service, and storage. Contracts in transit represent anticipated funding from the loan agreement customers execute at the dealership when they purchase their new or pre-owned boat. These finance contracts are typically funded within 30 days. Amounts due from manufacturers represent receivables for various manufacturer incentive programs and parts and service work performed pursuant to the manufacturers’ warranties.
The allowance for credit losses is estimated based on past collection experience, current conditions and reasonable and supportable forecasts. The activity for charges and subsequent recoveries is immaterial.
Accounts receivable consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
Trade accounts receivable$20,627 $32,578 
Contracts in transit16,021 20,437 
Manufacturer receivable11,546 11,435 
Income tax receivable9,246 9,370 
Total accounts receivable57,440 73,820 
Less – allowance for credit losses(528)(551)
Total accounts receivable, net$56,912 $73,269 
6.    Inventories
Inventories consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
New vessels$481,060 $442,834 
Pre-owned vessels86,142 79,234 
Work in process, parts and accessories69,474 68,770 
Total inventories$636,676 $590,838 
14


7.    Goodwill and Intangible Assets
Our acquisitions have resulted in the recording of goodwill and other identifiable intangible assets. Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Intangible assets consist of internally developed software, domain names and other identifiable intangible assets, such as trade names, developed technologies, and customer relationships related to the acquisitions the Company has completed. The changes in goodwill and intangible assets are as follows:
GoodwillTrade NamesDeveloped TechnologiesCustomer RelationshipsDomain NamesInternally Developed
Software
Total
Intangible
Assets, net
($ in thousands)UnamortizedUnamortizedAmortizedAmortizedAmortizedAmortized
Net balance as of September 30, 2024$336,602 $149,921 $3,964 $46,403 $1,750 $3,353 $205,391 
Acquisitions and additions during the three months ended December 31, 2024     362 362 
Accumulated amortization for the three months ended December 31, 2024— — (135)(1,525)(159)(303)(2,122)
Net balance as of December 31, 2024$336,602 $149,921 $3,829 $44,878 $1,591 $3,412 $203,631 
Amortization expense was $2.1 million and $1.6 million for the three months ended December 31, 2024 and 2023, respectively, which includes amortization expense of $0.3 million and $0.2 million for the three months ended December 31, 2024 and 2023, respectively, for internally developed software, and is recorded in depreciation and amortization expense in the unaudited condensed consolidated statements of operations. For internally developed software acquisitions and additions during the three months ended December 31, 2024, the weighted average useful life is 4.3 years.
The following table summarizes the expected amortization expense for the fiscal years 2025 through 2029 and thereafter ($ in thousands):
2025 (excluding the three months ended December 31, 2024)$6,381 
20268,508 
20278,265 
20286,687 
20296,686 
Thereafter17,183 
$53,710 
As of December 31, 2024 and September 30, 2024, the carrying value of goodwill totaled approximately $336.6 million, of which $295.3 million was related to our Dealerships reporting segment and $41.3 million was related to our Distribution reporting segment.
8.    Notes Payable — Floor Plan
The Company maintains an ongoing wholesale marine products inventory financing program with a syndicate of banks. The program is administered by Wells Fargo Commercial Distribution Finance, LLC (“Wells Fargo”) as set forth in the Eighth Amended and Restated Inventory Financing Agreement entered into by the Company and certain of its subsidiaries with Wells Fargo and the other financial institutions party thereto on November 14, 2023 (as amended from time to time, the “Inventory Financing Facility”). On November 13, 2024, the Company and certain of its subsidiaries entered into the Consent, Waiver and Second Amendment to the Eighth Amended and Restated Inventory Financing Agreement with Wells Fargo and other lenders party thereto which, among other things, (i) modified certain definitions, terms and conditions, (ii) adjusted the minimum fixed charge coverage ratio, (iii) adjusted the maximum funded debt to EBITDA ratio, (iv) established a new minimum liquidity measure, (v) allowed for certain swap transactions to mitigate risk in the ordinary course of business, and (vi) reduced the maximum borrowing capacity from $650 million to $595 million. The Inventory Financing Facility expires on March 1, 2026. The outstanding balance of the facility was $490.1 million and $443.4 million, as of December 31, 2024 and September 30, 2024, respectively.
Interest on new boats and for rental units is calculated using the Adjusted 30-Day Average SOFR (as defined in the Inventory Financing Facility) (“SOFR”) plus an applicable margin of 2.75% to 5.00% depending on the age of the inventory. Interest on pre-owned boats is calculated at the new boat rate plus 0.25%. Wells Fargo will finance 100.0% of the vendor invoice price for new boats, engines, and trailers. As of December 31, 2024 the interest rate on the Inventory Financing Facility ranged from 7.39% to 9.64% for new inventory and 7.64% to 9.89% for pre-owned inventory. As of September 30, 2024 the interest rate on the Inventory Financing Facility ranged from 8.03% to 10.28% for new inventory and 8.28% to 10.53% for pre-owned inventory. Borrowing capacity available at December 31, 2024 and September 30, 2024 was $104.9 million and $206.6 million, respectively.
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The Inventory Financing Facility has certain financial and non-financial covenants as specified in the agreement. The financial covenants include requirements to comply with a maximum funded debt to EBITDA ratio, a minimum fixed charge coverage ratio and a minimum liquidity measure (as defined in the Inventory Financing Facility). In addition, certain non-financial covenants could restrict the Company’s ability to sell assets (excluding inventory in the normal course of business), engage in certain mergers and acquisitions, incur additional debt and pay cash dividends or distributions, among others. The Company was in compliance with all covenants for the reporting period ended December 31, 2024.
The collateral for the Inventory Financing Facility consists primarily of our inventory that is financed through the Inventory Financing Facility and related assets, including accounts receivable, bank accounts and proceeds of the foregoing, and excludes the collateral that underlies the term note payable to Truist Bank.
9.    Long-term Debt and Line of Credit
On August 9, 2022, the Company and certain of its subsidiaries entered into the Amended and Restated Credit Agreement (the “A&R Credit Facility”) with Truist Bank. The A&R Credit Facility provides for a $65.0 million revolving credit facility (the “A&R Revolving Facility”) that may be used for revolving credit loans (including up to $5.0 million in swingline loans and up to $5.0 million in letters of credit) and a $445.0 million term loan (the “A&R Term Loan”). Subject to certain conditions, the available amount under the revolving credit facility and term loans may be increased by $125.0 million in the aggregate. The A&R Credit Facility bears interest at a rate that is equal to Term SOFR plus an applicable margin ranging from 1.75% to 2.75% based on certain consolidated leverage ratio measures. On November 13, 2024 the Company and certain of its subsidiaries entered into Amendment No. 6 to the Amended and Restated Credit Agreement and Waiver and Amendment No. 1 to Pledge and Security Agreement with Truist Bank to, among other things, (i) modify certain definitions, terms and conditions, (ii) adjust the minimum fixed charge coverage ratio, (iii) adjust the maximum leverage ratio measures, (iv) adjust the minimum liquidity measure, and (v) modify the maturity date to be July 31, 2026, and in connection therewith, the repayment schedule. The A&R Revolving Facility matures on July 31, 2026. The A&R Term Loan is repayable in installments beginning December 31, 2022, with the remainder due on July 31, 2026.
The A&R Credit Facility is collateralized by certain real and personal property (including certain capital stock) of the Company and its subsidiaries. The collateral does not include inventory and certain other assets of the Company’s subsidiaries financed under the Inventory Financing Facility. The A&R Credit Facility is subject to certain financial covenants related to the maintenance of a minimum fixed charge coverage ratio, a maximum consolidated leverage ratio and a minimum liquidity measure. The A&R Credit Facility also contains non-financial covenants and restrictive provisions that, among other things, limit the ability of the Company to incur additional debt, transfer or dispose of all of its assets, make certain investments, loans or payments and engage in certain transactions with affiliates. The Company was in compliance with all covenants for the reporting period ended December 31, 2024.
Long-term debt consisted of the following at:
($ in thousands except monthly payment amounts)December 31, 2024September 30, 2024
Term note payable to Truist Bank, secured and bearing interest at 7.58% at December 31, 2024 and 7.85% at September 30, 2024. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on July 31, 2026
$375,469 $375,469 
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 7.89% at December 31, 2024 and 7.75% at September 30, 2024. The note requires full repayment on July 31, 2026
58,040 51,150 
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029
2,254 2,561 
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note was paid in full on December 1, 2024
 1,126 
Total debt outstanding435,763 430,306 
Less current portion (net of debt issuance costs)(15,672)(7,874)
Less unamortized portion of debt issuance costs(7,501)(7,498)
Long-term debt, net of current portion and unamortized debt issuance costs$412,590 $414,934 
As of December 31, 2024 and September 30, 2024, the Company had $1.6 million in letters of credit outstanding under the A&R Revolving Facility.
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10.    Derivative and Hedging Instruments
The Company is subject to interest rate risk as a result of the Inventory Financing Facility and A&R Credit Facility required interest payments. The Company has two interest rate swap agreements which are designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in the SOFR and Term SOFR rates which are used in calculating interest payments. The following table provides information on the attributes of each swap as of December 31, 2024:
Inception DateHedged RateNotional Value at Inception (in thousands)Maturity Date
September 2024SOFR$200,000 September 2027
September 2024Term SOFR$200,000 September 2027
The fair value of the cash flow swaps is calculated using an income approach. The income approach involves using the quoted price for economically equivalent inputs or valuation methodologies, assumptions and inputs, which in the case of projected future cash flows, discount such cash flows to a single net present value amount. The following table provides information regarding the fair value of the interest rate swap agreements and the impact on the unaudited condensed consolidated balance sheets at ($ in thousands):
Balance Sheet LocationDecember 31, 2024September 30, 2024
Prepaid expenses and other current assets$2,500 $1,560 
Other long-term assets2,723  
Other long-term liabilities (3,626)
Net asset (liability)$5,223 $(2,066)
The interest rate swaps qualify for cash flow hedge accounting treatment. The interest rate swaps are marked to market each reporting date and any unrealized gains or losses, and the related income tax effects, are included in accumulated other comprehensive income (loss) and reclassified into earnings in the same period during which the hedged transactions affect earnings. Information about the effect of the interest swap agreements in the accompanying unaudited condensed consolidated statements of operations and unaudited condensed consolidated statements of comprehensive income (loss), is as follows ($ in thousands):
For the three months ended December 31,Results Recognized in Accumulated Other Comprehensive Income (Loss) (effective Portion)Location of Results Reclassified from Accumulated Other Comprehensive Income (Loss) to EarningsResults Reclassified from Accumulated Other Comprehensive Income (Loss) to Earnings
2024$8,573 Interest expense – other and Interest expense – floor plan$1,284 
2023$ Interest expense – other and Interest expense – floor plan$ 
The following table sets forth the location and amount of gain or (loss) recognized in earnings on cash flow hedging relationships for the three months ended December 31, 2024 and 2023 ($ in thousands):
December 31, 2024December 31, 2023
Interest expense – otherInterest expense – floor planInterest expense – otherInterest expense – floor plan
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings$568 $716 $ $ 
As of December 31, 2024, the amount expected to be reclassified out of accumulated other comprehensive income (loss) into earnings during the next 12 months is gains of $2.6 million. The ultimate amount recognized will vary based on fluctuations of interest rates through the maturity dates.
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11.    Stockholders’ Equity
Equity-Based Compensation
We maintain the OneWater Marine Inc. Omnibus Incentive Plan (the “LTIP”) to incentivize individuals providing services to OneWater Inc and its subsidiaries and affiliates. The LTIP provides for the grant, from time to time, at the discretion of the board of directors of OneWater Marine Inc. (the “Board”) or a committee thereof, of (1) stock options, (2) stock appreciation rights, (3) restricted stock, (4) restricted stock units, (5) stock awards, (6) dividend equivalents, (7) other stock-based awards, (8) cash awards, (9) substitute awards and (10) performance awards. The total number of shares reserved for issuance under the LTIP that may be issued pursuant to incentive stock options (which generally are stock options that meet the requirements of Section 422 of the Code) is 1,627,695. The LTIP is and will continue to be administered by the Board, except to the extent the Board elects a committee of directors to administer the LTIP. Class A common stock subject to an award that expires or is cancelled, forfeited, exchanged, settled in cash or otherwise terminated without delivery of shares (including forfeiture of restricted stock awards) and shares withheld to pay the exercise price of, or to satisfy the withholding obligations with respect to, an award will again be available for delivery pursuant to other awards under the LTIP.
During the three months ended December 31, 2024, the Board approved the grant of 152,072 performance-based restricted stock units, which represents 100% of the target award. Performance-based restricted stock units provide an opportunity for the recipient to receive a number of shares of our common stock based on our performance goals. A performance-based restricted stock unit equals one share of common stock of the Company. The performance-based restricted stock units vest in three equal annual installments commencing on October 1, 2025. As of December 31, 2024, the Company estimated achievement of the performance targets at 100%.
During the three months ended December 31, 2024, the Board approved the grant of 211,978 time-based restricted stock units. Of this amount, 36,596 restricted stock units fully vest on October 1, 2025 and the remaining 175,382 restricted stock units vest in three equal annual installments commencing on October 1, 2025.
Compensation cost for time-based restricted stock units is based on the closing price of our common stock on the date immediately preceding the grant and is recognized on a graded basis over the applicable vesting periods. Compensation cost for performance share units is based on the closing price of our common stock on the date immediately preceding the grant and the ultimate performance level achieved and is recognized on a graded basis over the applicable vesting period. The Company recognized $2.0 million and $2.3 million of compensation expense for the three months ended December 31, 2024 and 2023, respectively, which includes $0.8 million and $0.9 million of compensation expense for the three months ended December 31, 2024 and 2023, respectively, for performance-based units.
The following table further summarizes activity related to restricted stock units for the three months ended December 31, 2024:
Restricted Stock Unit Awards
Number of Shares Weighted Average
Grant Date Fair Value
Unvested at September 30, 2024542,119$27.20 
Awarded364,05023.91 
Vested(238,352)27.54 
Forfeited  
Unvested at December 31, 2024667,817$25.29 
As of December 31, 2024, the total unrecognized compensation expense related to outstanding equity awards was $9.8 million, which the Company expects to recognize over a weighted-average period of 1.4 years.
We issue shares of our Class A common stock upon the vesting of performance-based restricted stock units and time-based restricted stock units. These shares are issued from our authorized and not outstanding common stock. In addition, in connection with the vesting of restricted stock units, we repurchase a portion of shares equal to the amount of employee income tax withholding. We recognize forfeitures of performance-based restricted stock units and time-based restricted stock units as the forfeitures occur.
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Net Loss Per Share
Basic and diluted net loss per share of Class A common stock is computed by dividing net income (loss) attributable to OneWater Inc by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potentially dilutive shares.
The following table sets forth the calculation of net loss per share for the three months ended December 31, 2024 and 2023 (in thousands, except per share data):
Net earnings per share:Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Numerator:  
Net loss attributable to OneWater Inc$(11,971)$(7,170)
  
Denominator:  
Weighted-average number of unrestricted outstanding common shares used to calculate basic net loss per share14,83114,540
Effect of dilutive securities:  
Restricted stock units
Employee stock purchase plan
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted net earnings per share14,83114,540
  
Net loss per share of Class A common stock – basic$(0.81)$(0.49)
Net loss per share of Class A common stock – diluted$(0.81)$(0.49)
On March 30, 2022, the Board approved a share repurchase program up to $50 million. No shares of Class A common stock were repurchased by the Company during the three months ended December 31, 2024. As of December 31, 2024 the Company has repurchased and retired 73,487 shares of Class A common stock under the repurchase program for a purchase price of approximately $1.9 million. As of December 31, 2024, approximately $48.1 million remained available for future purchase under the repurchase program. The repurchase program does not have a predetermined expiration date.
Shares of Class B common stock and unvested restricted stock units do not share in the income (losses) of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted net earnings per share of Class B common stock under the two-class method has not been presented.
The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted net earnings per share because the effect of including such potentially dilutive shares would have been antidilutive upon conversion (in thousands):
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Class B common stock1,4301,430
Restricted Stock Units105495
Employee Stock Purchase Plan926
1,5441,951
Employee Stock Purchase Plan
At the Company’s 2021 Annual Meeting of Stockholders (the “Annual Meeting”), held on February 23, 2021, the Company’s stockholders approved the OneWater Marine Inc. 2021 Employee Stock Purchase Plan (the “ESPP”), which was approved and adopted by the Board as of January 13, 2021 (the “Adoption Date”), subject to stockholder approval at the Annual Meeting. The effective date of the ESPP is February 23, 2021, and, unless earlier terminated, the ESPP will expire on the twentieth anniversary of the Adoption Date. The ESPP will be administered by the Board or by one or more committees to which the Board delegates such administration.
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The ESPP enables eligible employees to purchase shares of the Company’s Class A common stock at a discount through participation in discrete offering periods. The ESPP is intended to qualify as an employee stock purchase plan under section 423 of the Internal Revenue Code of 1986, as amended. Up to a maximum of 603,622 shares of the Company’s Class A common stock may be issued under the ESPP as of December 31, 2024, subject to certain adjustments as set forth in the ESPP. On the first day of each fiscal year during the term of the ESPP, beginning on October 1, and ending on (and including) September 30, the number of shares of Class A common stock that may be issued under the ESPP will increase by a number of shares equal to the least of (i) 1% of the outstanding shares on the Adoption Date, or (ii) such lesser number of shares (including zero) that the administrator determines for purposes of the annual increase for that fiscal year. The number of shares of Class A common stock that may be granted to any single participant in any single option period will be subject to certain limitations set forth in the plan.
The Company recorded equity-based compensation for the ESPP of $0.1 million during the three months ended December 31, 2024 and 2023. As of December 31, 2024 and September 30, 2024, the Company had current liabilities of $0.5 million and $0.3 million, respectively, for future purchases of shares under the ESPP. No shares were issued under the ESPP during the three months ended December 31, 2024 and 2023.
We used a Black-Scholes model to estimate the fair value of the options granted to purchase shares issued pursuant to the ESPP. Volatility is based on the historical volatility of our common stock. The risk-free rate for periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of grant.
The following are the assumptions used for the periods ended December 31, 2024 and 2023:
20242023
Dividend yield0.0 %0.0 %
Risk-free interest rate
5.4%
5.5 %
Volatility
55.0%
37.6 %
Expected lifeSix monthsSix months
Distributions
During the three months ended December 31, 2023, the Company made distributions to OneWater Unit Holders for certain permitted tax payments. The Company did not make distributions to OneWater Unit Holders during the three months ended December 31, 2024
12.    Fair Value Measurements
In determining fair value, the Company uses various valuation approaches including market, income and/or cost approaches. FASB standard ‘‘Fair Value Measurements’’ (Topic 820) establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs are those that reflect the Company’s expectation of the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:
Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Assets utilizing Level 1 inputs include marketable securities that are actively traded.
Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. Asset and liability measurements utilizing Level 3 inputs include those used in estimating fair value of non-financial assets and non-financial liabilities in purchase acquisitions, those used in assessing impairment of property and equipment and other intangibles, and those used in the reporting unit valuation in the annual goodwill impairment evaluation and contingent consideration.
The availability of observable inputs can vary and is affected by a wide variety of factors. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment required in determining fair value is greatest for assets and liabilities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed is determined based on the lowest level input that is significant to the fair value measurement. Fair value measurements can be volatile based on various factors that may or may not be within the Company’s control.
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The following tables summarize the Company’s financial assets and liabilities measured at fair value in the accompanying unaudited condensed consolidated balance sheets as of December 31, 2024 and September 30, 2024:
December 31, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets: 
Investment in Equity Securities$135 $ $ $135 
Derivative and hedging instruments 5,223  5,223 
Liabilities: 
Contingent Consideration  14,947 14,947 
September 30, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets:    
Investment in Equity Securities$128 $ $ $128 
Derivative and hedging instruments 1,560  1,560 
Liabilities:    
Contingent Consideration  15,161 15,161 
Derivative and hedging instruments 3,626  3,626 
There were no transfers between the valuation hierarchy Levels 1, 2, and 3 for the three months ended December 31, 2024.
We measure all equity investments that do not result in consolidation and are not accounted for under the equity method at fair value with the change in fair value included in other expense (income), net, in the unaudited condensed consolidated statements of operations. The fair value of equity investments is measured using quoted prices in its active markets. The investment in equity securities balance is recorded in other long-term assets in the unaudited condensed consolidated balance sheets.
The portion of unrealized losses (gains) recognized related to equity securities still held as of December 31, 2024 and 2023 consists of the following:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Net (gain) loss recognized during the period on equity securities$(7)$112 
Less net loss recognized during the period on equity securities sold during the period  
Unrealized (gain) loss recognized during the reporting period on equity securities still held at the reporting date$(7)$112 
We estimate the fair value of contingent consideration using a probability-weighted discounted cash flow model based on forecasted future earnings or other agreed upon metrics including the production of acquisition leads. The acquisition contingent consideration liability has been accounted for based on inputs that are unobservable and significant to the overall fair value measurement (Level 3). The contingent consideration balance is recorded in other payables and accrued expenses and other long-term liabilities in the unaudited condensed consolidated balance sheets. Changes in fair value and net present value of contingent consideration are recorded in change in fair value of contingent consideration in the unaudited condensed consolidated statements of operations. The fair value of contingent consideration is reassessed on a quarterly basis.
The following table sets forth the changes in fair value of our contingent consideration for the three months ended December 31, 2024:
($ in thousands)Three Months Ended December 31, 2024
Balance as of September 30, 2024$15,161 
Additions from acquisitions 
Settlement of contingent consideration(456)
Change in fair value, including accretion242 
Balance as of December 31, 2024$14,947 
We determine the carrying value of our cash and cash equivalents, accounts receivable, accounts payable, other payables and accrued expenses, floor plan notes payable, term note payable with Truist Bank, seller notes payable and company vehicle notes payable
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approximate their fair values because of the nature of their terms and current market rates of these instruments. Derivative and hedging instruments are recorded at fair value as discussed in Note 10.
13.    Restructuring and Impairment
During the three months ended December 31, 2024, the Company underwent various restructuring actions, primarily a reduction of headcount, closure of certain locations and inventory adjustments related to the cancellation of certain dealer agreements. As a result of the restructuring activities, the Company recognized $1.9 million of restructuring charges during the three months ended December 31, 2024, of which $0.9 million is recorded in restructuring and impairment and $1.0 million is recorded in new boat cost of sales in the unaudited consolidated statement of operations. Of the $1.9 million restructuring charges, $1.2 million and $0.7 million is reported in the Dealerships and Distribution reporting segments, respectively. No restructuring and impairment charges were recorded for the three months ended December 31, 2023.
14.    Income Taxes
The Company is a corporation and, as a result, is subject to U.S. federal, state and local income taxes. OneWater LLC is treated as a pass-through entity for U.S. federal tax purposes and in most state and local jurisdictions. As such, OneWater LLC’s members, including the Company, are liable for federal and state income taxes on their respective shares of OneWater LLC’s taxable income.
Our effective tax rates of 27.9% and 22.2% for the three months ending December 31, 2024 and 2023, respectively, differ from statutory rates primarily due to losses allocated to non-controlling interests and limitations on officer's compensation.
The Company had federal net operating loss carryforwards from underlying corporate entities of approximately $4.3 million resulting in a deferred tax asset of $0.9 million as of September 30, 2024. The U.S. federal net operating loss carryforwards have no expiration but can only be used to offset up to 80% of future taxable income annually. The Company has Alabama net operating loss carryforwards of $0.3 million which has no limitation in use and expire in the years 2037 to 2040. The Company projects to fully utilize the net operating losses in subsequent fiscal years.
The Company has an IRC Section 163(j) interest expense carryforward of approximately $3.7 million, resulting in a deferred tax asset of $0.9 million as of September 30, 2024. The IRC Section 163(j) interest expense carryforward has no expiration.
The Company recognizes deferred tax assets to the extent it believes these assets are more-likely-than-not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing temporary differences, projected future taxable income, tax planning strategies and recent results of operations. Based on our cumulative earnings history and forecasted future sources of taxable income, we believe that we will fully realize our deferred tax assets in the future. The Company has not recorded a valuation allowance.
As of December 31, 2024 and September 30, 2024, the Company has not recognized any uncertain tax positions, penalties, or interest as management has concluded that no such positions exist. The Company is subject to examination in the US Federal and certain state tax jurisdictions for the tax years beginning with the year ended December 31, 2020. In November 2024, the Company received notification that the Florida Department of Revenue intended to commence a corporate income tax audit of OneWater Inc for the tax years ended September 30, 2021, 2022 and 2023. The audit is ongoing and the outcome and timing of settlements of asserted income tax liabilities, if any, are uncertain.
Tax Receivable Agreement
In connection with the IPO, the Company entered into a tax receivable agreement (the “Tax Receivable Agreement”) with certain of the owners of OneWater LLC. As of December 31, 2024 and September 30, 2024, our undiscounted liability under the Tax Receivable Agreement was $40.6 million, representing 85% of the calculated net cash savings in U.S. federal, state and local income tax and franchise tax that OneWater Inc anticipates realizing in future years from the result of certain increases in tax basis and certain tax benefits attributable to imputed interest as a result of OneWater Inc’s acquisition of OneWater LLC Units pursuant to an exercise of the Redemption Right or the Call Right (each as defined in the amended and restated limited liability company agreement of OneWater LLC (the “OneWater LLC Agreement”)).
The projection of future taxable income involves significant judgment. Actual taxable income may differ from our estimates, which could significantly impact our ability to make payments under the Tax Receivable Agreement. We have determined it is more-likely-than-not that we will be able to utilize all of our deferred tax assets subject to the Tax Receivable Agreement; therefore, we have recorded a liability under the Tax Receivable Agreement related to the tax savings we may realize from certain increases in tax basis and certain tax benefits attributable to imputed interest as a result of OneWater Inc’s acquisition of OneWater LLC Units pursuant to an exercise of the Redemption Right or Call Right (each as defined in the OneWater LLC Agreement). If we determine the utilization of these deferred tax assets is not more-likely-than-not in the future, our estimate of amounts to be paid under the Tax Receivable Agreement would be reduced. In this scenario, the reduction of the liability under the Tax Receivable Agreement would result in a benefit to our consolidated statements of operations.
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15.    Contingencies and Commitments
Employment Agreements
The Company is party to employment agreements with certain executives, which provide for compensation, other benefits and severance payments under certain circumstances. The Company also has consulting and noncompete agreements in place with previous owners of acquired companies.
Claims and Litigation
The Company is involved in various legal proceedings as either the defendant or plaintiff. Due to their nature, such legal proceedings involve inherent uncertainties including, but not limited to, court rulings, negotiations between the affected parties and other actions. Management assesses the probability of losses or gains for such contingencies and accrues a liability and/or discloses the relevant circumstances as appropriate. In the opinion of management, it is not reasonably probable that the pending litigation, disputes or claims against the Company, as of December 31, 2024, will have a material adverse effect on its financial condition, results of operations or cash flows. However, the outcome of any matter cannot be predicted with certainty, and an unfavorable resolution of one or more matters presently known or arising in the future could have a material adverse effect on the Company’s financial condition, liquidity or results of operations.
Risk Management
The Company is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions and natural disasters for which the Company carries commercial insurance. There have been no significant reductions in coverage from the prior year and settlements have not exceeded coverage in the past years.
16.    Leases
The Company leases real estate and equipment under operating lease agreements. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. For leases with terms in excess of 12 months, we record a right-of-use (“ROU”) asset and lease liability based on the present value of lease payments over the lease term. We do not have any significant leases that have not yet commenced that create significant rights and obligations for us. The Company has elected the practical expedient not to separate lease and non-lease components for all leases that qualify.
Our real estate and equipment leases often require payment of maintenance, real estate taxes and insurance. These costs are generally variable and based on actual costs incurred by the lessor. These amounts are not included in the consideration of the contract when determining the ROU asset and lease liability but are reflected as variable lease payments.
Most leases include one or more options to renew, with renewal terms that can extend the lease from one to ten or more years. The exercise of the lease renewal option is typically at our sole discretion. If it is reasonably certain that we will exercise the option to renew, the period covered by the options are included in the lease term and are recognized as part of our ROU assets and lease liabilities. Certain leases include the option to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, which includes renewal options reasonably certain to be exercised.
Certain of our lease agreements include rental payments based on percentage of retail sales over contractual levels and others include rental payments adjusted periodically based on index rates. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
17.    Related Party Transactions
In accordance with agreements approved by the Board, we purchased inventory, in conjunction with our retail sale of the products, from certain entities affiliated with the Company. Total purchases incurred under these arrangements were $52.4 million and $49.8 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, certain entities affiliated with the Company receive fees for rent of commercial property. Total expenses incurred under these arrangements were $1.4 million and $0.7 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, the Company received fees from certain entities and individuals affiliated with the Company for goods and services. Total fees recorded under these arrangements were $2.1 million and less than $1.1 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, the Company made payments to certain entities and individuals affiliated with the Company for goods and services. Total payments recorded under these arrangements were $0.2 million for the three months ended December 31, 2024. No payments were recorded under these arrangements for the three months ended December 31, 2023.
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In connection with transactions noted above, the Company owed $4.9 million and $6.0 million as recorded within accounts payable as of December 31, 2024 and September 30, 2024, respectively. No amounts were recorded within accounts receivable as of December 31, 2024 and September 30, 2024.
In connection with the Tax Receivable Agreement, the Company owed $36.2 million as recorded within current portion of tax receivable agreement liability and tax receivable agreement liability on the unaudited condensed consolidated balance sheets at December 31, 2024 and September 30, 2024. See further discussion of our Tax Receivable Agreement in Note 14.
18.    Segment Information
We report our operations through two reportable segments: (1) Dealerships and (2) Distribution. See Note 2 for more information about our segments.
Reportable segment financial information for the three months ended December 31, 2024 and 2023 are as follows:
As of and for the Three Months Ended December 31, 2024
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$347,670 $28,189 $(45)$375,814 
Income (loss) from operations3,020 (4,981)(12)(1,973)
  
Depreciation and amortization3,489 2,548  6,037 
Transaction costs512 47  559 
Change in fair value of contingent consideration242   242 
Restructuring and impairment1,156 742  1,898 
  
Total assets1,391,436 220,120 (10)1,611,546 
As of and for the Three Months Ended December 31, 2023
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$331,607 $32,466 $(60)$364,013 
Income (loss) from operations6,943 (465)(7)6,471 
Depreciation and amortization2,902 2,003  4,905 
Transaction costs440 139  579 
Change in fair value of contingent consideration572   572 
Restructuring and impairment    
Total assets1,445,553 247,553 (33)1,693,073 
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Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Unless the context requires otherwise, references in this report to the “Company,” “we,” “us,” and “our” refer to OneWater Marine Inc. and its consolidated subsidiaries. The following discussion and analysis should be read in conjunction with the accompanying financial statements and related notes. The following discussion contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those factors discussed above in “Cautionary Statement Regarding Forward-Looking Statements” and described under the heading “Risk Factors” included in our Annual Report on Form 10-K for the year ended September 30, 2024, filed with the SEC on December 10, 2024, all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.
Overview
We believe that we are one of the largest and fastest-growing marine retailers in the United States with 96 dealerships, 10 distribution centers/warehouses and multiple online marketplaces as of December 31, 2024. Our dealer groups are located within highly attractive markets throughout the Southeast, Gulf Coast, Mid-Atlantic and Northeast, many of which are in the top twenty states for marine retail expenditures. We believe that we are a market leader by volume in sales of premium boats in many of the markets in which we operate. In addition to boat sales, we also generate sales from related products including finance & insurance and service, parts & other sales. The acquisitions of T-H Marine Supplies, LLC (“T-H Marine”) and Ocean Bio-Chem, LLC (f/k/a Ocean Bio-Chem, Inc. ("Ocean Bio-Chem")) significantly expanded our sales of marine parts and accessories. The combination of our significant scale, diverse inventory, access to premium boat brands, access to a broad array of parts and accessories, and meaningful brand equity enables us to provide a consistently professional experience as reflected in the number of our repeat customers and Dealership same-store sales growth.
We report our operations through two reportable segments: Dealerships and Distribution.
As of December 31, 2024, the Dealerships segment includes operations of 96 dealerships in 17 states including Florida, Texas, Alabama and Georgia, among others, and represents approximately 93% of revenues for the three months ended December 31, 2024. The Dealerships segment engages in the sale of new and pre-owned boats, arranges financing and insurance products, performs repairs and maintenance services, offers marine-related parts and accessories and offers slip and storage accommodations in certain locations. In fiscal year 2024, we sold over 9,500 new and pre-owned boats, many of which were sold to customers who had a trade-in or with whom we otherwise had established relationships. The combination of our significant scale, diverse inventory and revenue streams, access to premium boat brands and meaningful brand equity enables us to provide a consistently professional experience as reflected by the number of our repeat customers and Dealership same-store sales growth.
As of December 31, 2024, the Distribution segment includes the activity of three of our fully-owned businesses, Central Assets & Operations, LLC d/b/a PartsVu ("PartsVu"), Ocean Bio-Chem and its subsidiaries and T-H Marine and its subsidiaries, which together operate 10 distribution centers/warehouses in Alabama, Florida, Oklahoma, Indiana and Tennessee and represents approximately 7% of revenues for the three months ended December 31, 2024. The Distribution segment engages in the manufacturing, assembly and distribution of primarily marine-related products for sale to distributors, big box retailers, online retailers and direct to consumers. We offer a wide array of branded parts and accessories including jack plates, rigging parts, plumbing components, LED lighting, storage systems, and appearance, cleaning, and maintenance products for the marine and ancillary industries. All revenue for the Distribution segment is reported in service, parts & other in our consolidated statements of operations.
We were formed in 2014 as OneWater LLC through the combination of Singleton Marine and Legendary Marine, which created a marine retail platform that collectively owned and operated 19 dealerships. Since the combination in 2014, we have acquired a total of 81 additional dealerships, 12 distribution centers/warehouses and multiple online marketplaces through 34 acquisitions. Our current portfolio as of December 31, 2024 consists of multiple brands which are recognized on a local, regional or national basis. Because of this, we believe we are one of the largest and fastest-growing marine retailers in the United States based on number of dealerships and total boats sold. While we have opportunistically opened new dealerships in select markets, or launched additional parts and accessory products, we believe that it is generally more effective economically and operationally to acquire existing businesses with experienced staff and established reputations.
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The boat dealership market is highly fragmented and is comprised of approximately 4,000 dealerships nationwide. Most competing boat retailers are operated by local business owners who own three or fewer stores; however, we do have other large competitors. Despite our size, we comprise less than 4% of total industry sales. Our scale and business model allow us to leverage our extensive inventory to provide consumers with the ability to find a boat that matches their preferences (e.g., make, model, color, configuration and other options) and to deliver the boat within days while providing a personalized sales experience. In addition to boat sales, we also generate sales from related products including finance & insurance and service, parts & other sales. The addition of our Distribution segment has significantly expanded our sales of marine parts and accessories. Our strategic growth in this area is also expected to materially expand our addressable market in the parts and accessories business. We are able to operate with a comparatively higher degree of profitability than other independent retailers because we allocate support resources across our broader base, focus on high margin service, parts and accessories, utilize floor plan financing and provide core back-office functions on a scale that many independent retailers are unable to match. We seek to be the leading marine retailer by total market share within each boating market and within the product segments in which we participate. To the extent that we are not, we will evaluate acquiring other local retailers in order to increase our sales, to add additional brands or to provide us with additional high-quality personnel.
Trends and Other Factors Impacting Our Performance
Acquisitions
We are a highly acquisitive company. Since the combination of Singleton Marine and Legendary Marine in 2014, we have acquired 81 additional dealerships through 29 dealer group acquisitions. Our team remains focused on expanding our dealership growth in regions with strong boating cultures, enhancing the customer experience and generating value for our shareholders. In addition to dealership acquisitions, the Company has strategically acquired parts and accessories companies as part of our growth and diversification strategy. We have acquired 12 distribution centers and warehouses through the acquisition of 5 parts and accessories companies. We plan to continue to strategically evaluate and complete acquisitions moving forward.
We have an extensive acquisition track record within the retail marine industry and believe we have developed a reputation for treating sellers and their staff in an honest and fair manner. We typically retain the management team and name of the acquired group. We believe this practice preserves customer relationships and goodwill in the local marketplace. We believe our reputation and scale have positioned us as a buyer of choice for marine retailers who want to sell their businesses. Our strategy is to acquire dealerships at attractive EBITDA multiples and then grow same-store sales while benefiting from cost-reducing synergies. Historically, we have typically acquired dealerships for less than 4.0x EBITDA on a trailing twelve-month basis and believe that we will be able to continue to make attractive acquisitions within this range. With the expansion of our Distribution segment, we look to acquire parts and accessories manufacturing and distribution companies within a range of 5.0x – 10.0x EBITDA on a trailing twelve-month basis, depending on the size of the business.
General Economic Conditions
General economic conditions and consumer spending patterns can negatively impact our operating results. Unfavorable local, regional, national, or global economic developments or uncertainties, including the adverse economic effects of higher interest rates or inflation, supply chain constraints, or a prolonged economic downturn, could reduce consumer spending and adversely affect our business. Consumer spending on discretionary goods may also decline as a result of lower consumer confidence levels, higher interest rates or higher fuel costs, even if prevailing economic conditions are otherwise favorable. Economic conditions in areas in which we operate dealerships, particularly in the Southeast, can have a major impact on our overall results of operations. Local influences, such as corporate downsizing, inclement weather such as hurricanes, tornadoes, and other storms, environmental conditions, and global public health concerns and events have and could adversely affect our operations in certain markets and in certain periods. Any extended period of adverse economic conditions or low consumer confidence is likely to have a negative effect on our business.
Our business was significantly impacted during the recessionary period that began in 2007. This period of weakness in consumer spending and depressed economic conditions had a substantial negative effect on our operating results. In response to these conditions we reduced our inventory purchases, closed certain dealerships and reduced headcount. Additionally, in an effort to counteract the downturn, we increased our focus on pre-owned sales, parts and repair services, and finance & insurance services. As a result, we surpassed our pre-recession sales levels in less than 24 months. While we believe the measures we took significantly reduced the impact of the downturn on the business, we cannot guarantee similar results in the event of a future downturn. Additionally, we cannot predict the timing or length of unfavorable economic or industry conditions, including a downturn as a result of a global health crisis, rising interest rates, inflation, or the extent to which they could adversely affect our operating results.
Although past economic conditions have adversely affected our operating results, we believe we are capable of responding in a manner that allows us to substantially outperform the industry and gain market share. We believe our ability to capture such market share enables us to align our retail strategies with the desires of customers. We expect our core strengths, including retail and acquisition strategies, will allow us to capitalize on growth opportunities as they occur, despite market conditions.
Critical Accounting Estimates
There have been no material changes in our critical accounting policies and estimates from the information provided in the Company’s Annual Report for the fiscal year ended September 30, 2024.
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How We Evaluate Our Operations
Revenue
We have a diversified revenue profile that is comprised of new boat sales, pre-owned boat sales, finance & insurance products, repair and maintenance services, and parts and accessories sales. During different phases of the economic cycle, consumer behavior may shift away from new boats; however, we are well-positioned to generate revenue from pre-owned boats, repair and maintenance services, and parts and accessories, which have all historically increased during periods of economic uncertainty. We generate pre-owned sales from boats traded-in for new and pre-owned boats, boats purchased from customers, brokerage transactions, consignment sales and wholesale sales. We continue to focus on all aspects of our business including non-boat sales of finance & insurance products, repair and maintenance services, and parts and accessories. Although non-boat sales contributed approximately 18.9% and 19.1% to revenue in the three months ended December 31, 2024 and 2023, respectively, due to the higher gross margin on these product and service lines, non-boat sales contributed 42.8% and 38.1% to gross profit in the three months ended December 31, 2024 and 2023, respectively. We have also diversified our business across geographies, dealership types (e.g., fresh water and salt water), and product offerings (e.g., focus on parts and accessories businesses through our Distribution segment) in order to reduce the effects of seasonality and cyclicality of our business. In addition to seasonality, revenue and operating results may be significantly affected by quarter-to-quarter changes in economic conditions, manufacturer incentive programs, adverse weather conditions and other developments outside of our control.
Gross Profit
We calculate gross profit as revenue less cost of sales. Cost of sales consists of actual amounts paid for products, costs of services (primarily labor), transportation costs from manufacturers to our dealerships and vendor consideration. Gross profit excludes the majority of our depreciation and amortization, which is presented separately in our consolidated statements of operations.
Gross Profit Margin
Our overall gross profit margin varies with our revenue mix. Sales of new and pre-owned boats, which have comparable margins, generally result in a lower gross profit margin than our non-boat sales. As a result, when revenue from non-boat sales increases as a percentage of total revenue, we expect our overall gross profit margin to increase.
Selling, General and Administrative Expenses
Selling, general and administrative expenses consist primarily of base salaries and incentive-based compensation, advertising, rent, insurance, utilities, and other customary operating expenses. A portion of our cost structure is variable (such as sales commissions and incentive compensation), or controllable (such as advertising), which we believe allows us to adapt to changes in the retail environment over the long term. We typically evaluate our variable expenses, selling expenses and all other selling, general and administrative expenses in the aggregate as a percentage of total revenue.
Dealership Same-Store Sales
We assess the organic growth of our Dealership segment revenue on a same-store basis. We believe that our assessment on a same-store basis represents an important indicator of comparative financial results and provides relevant information to assess our performance. New and acquired dealerships become eligible for inclusion in the comparable dealership base at the end of the dealership’s thirteenth month of operations under our ownership and revenues are only included for identical months in the same-store base periods. Dealerships relocated within an existing market remain in the comparable dealership base for all periods. Additionally, amounts related to closed dealerships are excluded from each comparative base period. Because Dealership same-store sales may be defined differently by other companies in our industry, our definition of this measure may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
Adjusted EBITDA
We define Adjusted EBITDA as net income (loss) before interest expense – other, income tax (benefit) expense, depreciation and amortization and other (income) expense, further adjusted to eliminate the effects of items such as the change in fair value of contingent consideration, transaction costs, stock-based compensation and restructuring and impairment. See ‘‘—Comparison of Non-GAAP Financial Measures’’ for more information and a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP.
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Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share
We define Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. as net income (loss) attributable to OneWater Marine Inc. before transaction costs, intangible amortization, change in fair value of contingent consideration, restructuring and impairment and other (income) expense, all of which are then adjusted for an allocation to the non-controlling interest of OneWater LLC. Each of these adjustments are subsequently adjusted for income tax at an estimated effective tax rate. Management also reports Adjusted Diluted Earnings Per Share which presents all of the adjustments to net income (loss) attributable to OneWater Marine Inc. on a per share basis. See ‘‘—Comparison of Non-GAAP Financial Measures’’ for more information and a reconciliation of Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share to net income (loss) and net earnings (loss) per share, respectively, the most directly comparable financial measures calculated and presented in accordance with GAAP.
Summary of Acquisitions
Acquisitions
The comparability of our results of operations between the periods discussed below is naturally affected by the acquisitions we have completed during such periods. We are also continuously evaluating and pursuing acquisitions on an ongoing basis, and such acquisitions, if completed, will continue to impact the comparability of our financial results. While we expect continued growth and strategic acquisitions in the future, our acquisitions may have materially different characteristics than our historical results, and such differences in economics may impact the comparability of our future results of operations to our historical results.
Fiscal 2025 Year-to-date Acquisitions
There have been no acquisitions during fiscal year 2025.
Fiscal Year 2024 Acquisitions
Effective May 1, 2024, we acquired Garden State Yacht Sales, a full service marine retailer located in New Jersey
We refer to the fiscal year 2024 acquisition described above as the “2024 Acquisition.” The 2024 Acquisition is not reflected in our unaudited condensed consolidated statements of operations for the three months ended December 31, 2023.
On October 31, 2023, we exercised our right to acquire the remaining 20% economic interest in Quality Assets and Operations, LLC. Subsequent to the acquisition, the Company now owns 100% of the economic interest in Quality Assets and Operations, LLC.
Other Factors Affecting Comparability of Our Future Results of Operations to Our Historical Results of Operations
Our historical financial results discussed below may not be comparable to our future financial results. As we further implement controls, processes and infrastructure applicable to companies with publicly traded equity securities, including the integration of acquired companies, it is likely that we will incur additional selling, general, and administrative expenses relative to historical periods. Our future results will depend on our ability to efficiently manage our combined operations and execute our business strategy.
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Results of Operations
Three Months Ended December 31, 2024, Compared to Three Months Ended December 31, 2023
For the Three Months Ended December 31, 2024For the Three Months Ended December 31, 2023$ Change % Change
($ in thousands) Amount % of Revenue Amount % of Revenue
Revenues:
New boat$247,997 66.0 %$241,084 66.2 %$6,913 2.9 %
Pre-owned boat56,798 15.1 %53,283 14.6 %3,515 6.6 %
Finance & insurance income9,400 2.5 %7,360 2.0 %2,040 27.7 %
Service, parts & other61,619 16.4 %62,286 17.1 %(667)-1.1 %
Total revenues375,814 100.0 %364,013 100.0 %11,801 3.2 %
Gross Profit
New boat36,876 9.8 %44,681 12.3 %(7,805)-17.5 %
Pre-owned boat11,216 3.0 %11,937 3.3 %(721)-6.0 %
Finance & insurance9,400 2.5 %7,360 2.0 %2,040 27.7 %
Service, parts & other26,562 7.1 %27,465 7.5 %(903)-3.3 %
Total gross profit84,054 22.4 %91,443 25.1 %(7,389)-8.1 %
Selling, general and administrative expenses79,060 21.0 %79,599 21.9 %(539)-0.7 %
Depreciation and amortization5,315 1.4 %4,222 1.2 %1,093 25.9 %
Transaction costs559 0.1 %579 0.2 %(20)-3.5 %
Change in fair value of contingent consideration242 0.1 %572 0.2 %(330)-57.7 %
Restructuring and impairment851 0.2 %— — %851 100.0 %
(Loss) income from operations(1,973)-0.5 %6,471 1.8 %(8,444)-130.5 %
Interest expense – floor plan7,026 1.9 %7,812 2.1 %(786)-10.1 %
Interest expense – other8,988 2.4 %9,152 2.5 %(164)-1.8 %
Other expense (income), net887 0.2 %(247)-0.1 %1,134 -459.1 %
Net loss before income tax benefit(18,874)-5.0 %(10,246)-2.8 %(8,628)84.2 %
Income tax benefit(5,262)-1.4 %(2,276)-0.6 %(2,986)131.2 %
Net loss(13,612)-3.6 %(7,970)-2.2 %(5,642)70.8 %
Net (income) attributable to non-controlling interests — (119)
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC1,641 919 
Net loss attributable to OneWater Marine Inc.$(11,971)$(7,170)
Revenue
Overall, revenue increased by $11.8 million, or 3.2%, to $375.8 million for the three months ended December 31, 2024 from $364.0 million for the three months ended December 31, 2023. Revenue increased due to same-store sales growth of 4.2%, driven by an increase in unit sales for the three months ended December 31, 2024 compared to the three months ended December 31, 2023, as part of our strategic inventory management and operational execution. Overall the revenue increase was attributable to a $6.9 million increase in new boat sales, a $3.5 million increase in pre-owned boat sales and a $2.0 million increase in finance & insurance income for the three months ended December 31, 2024 compared to the three months ended December 31, 2023.
New Boat Sales
New boat sales increased by $6.9 million, or 2.9%, to $248.0 million for the three months ended December 31, 2024 from $241.1 million for the three months ended December 31, 2023. The increase was primarily attributable to the increase in the unit sales resulting from the continued strategic management of our inventory.
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Pre-owned Boat Sales
Pre-owned boat sales increased by $3.5 million, or 6.6%, to $56.8 million for the three months ended December 31, 2024 from $53.3 million for the three months ended December 31, 2023. We sell a wide range of brands and sizes of pre-owned boats under different types of sales arrangements (e.g., trade-ins, brokerage, consigned and wholesale), which causes periodic and seasonal fluctuations in the average sales price. The increase in pre-owned boat sales was primarily attributable to the increase in both units sold and average unit price.
Finance & Insurance Income
We generate revenue from arranging finance & insurance products, including financing, insurance and extended warranty contracts, to customers through various third-party financial institutions and insurance companies. Finance & insurance income increased by $2.0 million, or 27.7%, to $9.4 million for the three months ended December 31, 2024 from $7.4 million for the three months ended December 31, 2023. The increase was primarily due to the increase in new and pre-owned boat sales. We remain very focused on improving sales of finance & insurance products throughout our dealer network and implementing best practices at acquired dealer groups and existing dealerships. Finance & insurance income is recorded net of related fees, including fees charged back due to any early cancellation of loan or insurance contracts by a customer. Since finance & insurance income is fee-based, we do not incur any related cost of sale.
Service, Parts & Other Sales
Service, parts & other sales decreased by $0.7 million, or 1.1%, to $61.6 million for the three months ended December 31, 2024 from $62.3 million for the three months ended December 31, 2023. The decrease in service, parts & other sales is primarily due to a reduction in parts and accessories sold to OEMs as boat manufacturers continue to slow production. Revenues for the Distribution segment are reported in service, parts & other sales and totaled $28.2 million and $32.5 million for the three months ended December 31, 2024 and 2023, respectively.
Gross Profit
Overall, gross profit decreased by $7.4 million, or 8.1%, to $84.1 million for the three months ended December 31, 2024 from $91.4 million for the three months ended December 31, 2023. This decrease was primarily due to new and pre-owned boat pricing, including the impact of select brands the Company is exiting. Overall gross margin decreased 270 basis points to 22.4% for the three months ended December 31, 2024 from 25.1% for the three months ended December 31, 2023 due to the factors noted below.
New Boat Gross Profit
New boat gross profit decreased by $7.8 million, or 17.5%, to $36.9 million for the three months ended December 31, 2024 from $44.7 million for the three months ended December 31, 2023. This decrease was due to the decrease in new boat gross profit margins. New boat gross profit margin was 14.9% for the three months ended December 31, 2024 as compared to 18.5% in the three months ended December 31, 2023. The decrease was primarily due to new boat pricing, including the impact of select brands the Company is exiting.
Pre-owned Boat Gross Profit
Pre-owned boat gross profit decreased by $0.7 million, or 6.0%, to $11.2 million for the three months ended December 31, 2024 from $11.9 million for the three months ended December 31, 2023. This decrease was due to the decrease in pre-owned boat gross profit margins. Pre-owned boat gross profit margin was 19.7% and 22.4% for the three months ended December 31, 2024 and 2023, respectively. The decrease was primarily due to pricing efforts by the Company to manage inventory.
Finance & Insurance Gross Profit
Finance & insurance gross profit increased by $2.0 million, or 27.7% to $9.4 million for the three months ended December 31, 2024 from $7.4 million for the three months ended December 31, 2023. Finance & insurance income is fee-based revenue for which we do not recognize incremental cost of sales.
Service, Parts & Other Gross Profit
Service, parts & other gross profit decreased by $0.9 million, or 3.3%, to $26.6 million for the three months ended December 31, 2024 from $27.5 million for the three months ended December 31, 2023. The decrease in gross profit was primarily the result of the reduction in service, parts & other sales. Service, parts & other gross profit margin was 43.1% and 44.1% for the three months ended December 31, 2024 and 2023, respectively.
Selling, General and Administrative Expenses
Selling, general and administrative expenses decreased by $0.5 million, or 0.7%, to $79.1 million for the three months ended December 31, 2024 from $79.6 million for the three months ended December 31, 2023. This decrease was primarily due to the cost savings resulting from various restructuring activities. Selling, general and administrative expenses as a percentage of revenue decreased to 21.0% from 21.9% for the three months ended December 31, 2024 and 2023, respectively, and was driven by higher revenues.
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Depreciation and Amortization
Depreciation and amortization expense increased $1.1 million, or 25.9%, to $5.3 million for the three months ended December 31, 2024 compared to $4.2 million for the three months ended December 31, 2023. The increase in depreciation and amortization expense for the three months ended December 31, 2024 compared to the three months ended December 31, 2023 was primarily attributable to an increase in intangible assets and property and equipment to support operations.
Transaction Costs
Transaction costs remained flat at $0.6 million for the three months ended December 31, 2024 compared to $0.6 million for the three months ended December 31, 2023 which is attributable to similar acquisition activity for the three months ended December 31, 2024 and 2023.
Change in Fair Value of Contingent Consideration
During the three months ended December 31, 2024, we recognized a loss of $0.2 million related to accretion of contingent consideration liabilities.
(Loss) Income from Operations
(Loss) income from operations decreased $8.4 million, or 130.5%, to a $2.0 million loss for the three months ended December 31, 2024 compared to $6.5 million of income for the three months ended December 31, 2023. The decrease was primarily attributable to the $7.4 million decrease in gross profit and the $1.1 million increase in depreciation and amortization for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023, partially offset by a $0.5 million decrease in selling, general and administrative expenses during the same periods.
Interest Expense – Floor Plan
Interest expense – floor plan decreased $0.8 million, or 10.1%, to $7.0 million for the three months ended December 31, 2024 compared to $7.8 million for the three months ended December 31, 2023. Floor plan related interest expense decreased primarily due to an decrease in the average inventory for the three months ended December 31, 2024 compared to the three months ended December 31, 2023, as well as the impact of our interest rate swaps for the three months ended December 31, 2024.
Interest Expense – Other
Interest expense – other decreased by $0.2 million, or 1.8%, to $9.0 million for the three months ended December 31, 2024 compared to $9.2 million for the three months ended December 31, 2023. The decrease in interest expense – other was primarily related to the impact of our interest rate swaps for the three months ended December 31, 2024.
Other Expense (Income), Net
Other expense (income), net changed by $1.1 million, or 459.1%, to $0.9 million of expense for the three months ended December 31, 2024 compared to $0.2 million of income for the three months ended December 31, 2023. The change was primarily related to hurricane related expenses during the three months ended December 31, 2024.
Income Tax Benefit
Income tax benefit increased by $3.0 million, or 131.2%, to $5.3 million for the three months ended December 31, 2024 compared to $2.3 million for the three months ended December 31, 2023. The change was primarily attributable to the 84.2% increase in loss before income tax benefit for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Net loss
Net loss increased by $5.6 million to $13.6 million for the three months ended December 31, 2024 compared to $8.0 million for the three months ended December 31, 2023. The increase was primarily attributable to the $8.4 million decrease in income from operations, partially offset by the $3.0 million increase in income tax benefit for the three months ended December 31, 2024 compared to the three months ended December 31, 2023.
Comparison of Non-GAAP Financial Measures
Adjusted EBITDA
We view Adjusted EBITDA as an important indicator of performance. We define Adjusted EBITDA as net income (loss) before interest expense – other, income tax (benefit) expense, depreciation and amortization and other (income) expense, further adjusted to eliminate the effects of items such as the change in fair value of contingent consideration, restructuring and impairment, stock-based compensation and transaction costs.
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Our Board, management team and lenders use Adjusted EBITDA to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of our capital structure (such as varying levels of interest expense), asset base (such as depreciation and amortization) and other items (such as the change in fair value of contingent consideration, income tax (benefit) expense, restructuring and impairment, stock-based compensation and transaction costs) that impact the comparability of financial results from period to period. We present Adjusted EBITDA because we believe it provides useful information regarding the factors and trends affecting our business in addition to measures calculated under GAAP. Adjusted EBITDA is not a financial measure presented in accordance with GAAP. We believe that the presentation of this non-GAAP financial measure will provide useful information to investors and analysts in assessing our financial performance and results of operations across reporting periods by excluding items we do not believe are indicative of our core operating performance. Net income (loss) is the GAAP measure most directly comparable to Adjusted EBITDA. Our non-GAAP financial measure should not be considered as an alternative to the most directly comparable GAAP financial measure. You are encouraged to evaluate each of these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted EBITDA, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in such presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted EBITDA in the future, and any such modification may be material. Adjusted EBITDA has important limitations as an analytical tool and you should not consider Adjusted EBITDA in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted EBITDA may be defined differently by other companies in our industry, our definition of this non-GAAP financial measure may not be comparable to similarly titled measures of other companies, thereby diminishing its utility.
The following tables present a reconciliation of Adjusted EBITDA to our net income (loss), which is the most directly comparable GAAP measure for the periods presented.
Three Months Ended December 31, 2024, Compared to Three Months Ended December 31, 2023
Three Months Ended December 31,
($ in thousands)20242023
Net loss$(13,612)$(7,970)
Interest expense – other8,988 9,152 
Income tax benefit(5,262)(2,276)
Depreciation and amortization6,037 4,906 
Stock-based compensation2,170 2,392 
Change in fair value of contingent consideration242 572 
Transaction costs559 579 
Restructuring and impairment1,898 — 
Other expense (income), net887 (247)
Adjusted EBITDA$1,907 $7,108 
Adjusted EBITDA was $1.9 million for the three months ended December 31, 2024 compared to $7.1 million for the three months ended December 31, 2023. The decrease in Adjusted EBITDA resulted primarily from the decrease in gross profit, partially offset by the decrease in selling, general and administrative expenses and interest expense - floor plan for the three months ended December 31, 2024 compared to the three months ended December 31, 2023.
Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share
We view Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share as important indicators of performance. We define Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. as net income (loss) attributable to OneWater Marine Inc. before transaction costs, intangible amortization, change in fair value of contingent consideration, restructuring and impairment and other expense (income), all of which are then adjusted for an allocation to the non-controlling interest of OneWater LLC. Each of these adjustments are subsequently adjusted for income tax at an estimated effective tax rate. Management also reports Adjusted Diluted Earnings (Loss) Per Share which presents all of the adjustments to net income (loss) attributable to OneWater Marine Inc. noted above on a per share basis.
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Our Board, management team and lenders use Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share to assess our financial performance because it allows them to compare our operating performance on a consistent basis across periods by removing the effects of unusual or one time charges and other items (such as the change in fair value of contingent consideration, intangible amortization, restructuring and impairment and transaction costs) that impact the comparability of financial results from period to period. We present Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share because we believe they provide useful information regarding the factors and trends affecting our business in addition to measures calculated under GAAP. Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share are not financial measures presented in accordance with GAAP. We believe that the presentation of these non-GAAP financial measures will provide useful information to investors and analysts in assessing our financial performance and results of operations across reporting periods by excluding items we do not believe are indicative of our core operating performance. Net income (loss) attributable to OneWater Marine Inc. is the GAAP measure most directly comparable to Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and net earnings (loss) per share of Class A common stock - diluted is the GAAP measure most directly comparable to Adjusted Diluted Earnings (Loss) Per Share. Our non-GAAP financial measures should not be considered as an alternative to the most directly comparable GAAP financial measure. You are encouraged to evaluate each of these adjustments and the reasons we consider them appropriate for supplemental analysis. In evaluating Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in such presentation. Our presentation of Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. There can be no assurance that we will not modify the presentation of Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share in the future, and any such modification may be material. Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share have important limitations as analytical tools and you should not consider Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. or Adjusted Diluted Earnings (Loss) Per Share in isolation or as a substitute for analysis of our results as reported under GAAP. Because Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share may be defined differently by other companies in our industry, our definition of these non-GAAP financial measures may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.
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The following tables present a reconciliation of Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. to our net income (loss) attributable to OneWater Marine Inc. and Adjusted Diluted Earnings (Loss) Per Share to our net earnings (loss) per share of Class A common stock - diluted, which are the most directly comparable GAAP measures for the periods presented.
Three Months Ended December 31, 2024, Compared to Three Months Ended December 31, 2023.

Three Months Ended December 31,
Description20242023Change
($ in thousands)
Net loss attributable to OneWater Marine Inc.$(11,971)$(7,170)$(4,801)
Transaction costs559 579 (20)
Intangible amortization2,122 1,579 543 
Change in fair value of contingent consideration242 572 (330)
Restructuring and impairment1,898 — 1,898 
Other expense (income), net887 (247)1,134 
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC (1)(514)(223)(291)
Adjustments to income tax benefit (2)(1,195)(520)(675)
Adjusted net loss attributable to OneWater Marine Inc.(7,972)(5,430)(2,542)
Net loss per share of Class A common stock - diluted$(0.81)$(0.49)$(0.32)
Transaction costs0.04 0.04 — 
Intangible amortization0.14 0.11 0.03 
Change in fair value of contingent consideration0.02 0.04 (0.02)
Restructuring and impairment0.13 — 0.13 
Other expense (income), net0.06 (0.02)0.08 
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC (1)(0.04)(0.02)(0.02)
Adjustments to income tax benefit (2)(0.08)(0.04)(0.04)
Adjusted loss per share of Class A common stock - diluted$(0.54)$(0.38)$(0.16)
(1) Represents an allocation of the impact of reconciling items to our non-controlling interest.
(2) Represents an adjustment of all reconciling items at an estimated effective tax rate.
Adjusted Net Loss Attributable to OneWater Marine Inc. and Adjusted Diluted Loss Per Share were $8.0 million and $0.54, respectively, for the three months ended December 31, 2024 compared to Adjusted Net Loss Attributable to OneWater Marine Inc. and Adjusted Diluted Loss Per Share of $5.4 million and $0.38, respectively, for the three months ended December 31, 2023. The decrease in Adjusted Net Income (Loss) Attributable to OneWater Marine Inc. resulted from the decrease in gross profit, partially offset by the decreases in selling, general and administrative expenses and interest expense - floor plan for the three months ended December 31, 2024, each as compared to the three months ended December 31, 2023. The decrease in Adjusted Diluted Earnings (Loss) Per Share resulted from the decrease in Adjusted Net Income (Loss) Attributable to OneWater Marine Inc.
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Seasonality
Our business, along with the entire boating industry, is highly seasonal, and such seasonality varies by geographic market. With the exception of Florida, we generally realize significantly lower sales and higher levels of inventories, and related floor plan borrowings, in the quarterly periods ending December 31 and March 31. Revenue generated from our dealerships in Florida serves to offset generally lower winter revenue in our other states and enables us to maintain a more consistent revenue stream. The onset of the public boat and recreation shows in January stimulates boat sales and typically allows us to reduce our inventory levels and related floor plan borrowings throughout the remainder of the fiscal year. The impact of seasonality on our results of operations could be materially impacted based on the location of our acquisitions. For example, our operations could be substantially more seasonal if we acquire dealer groups that operate in colder regions of the United States. Our business is also subject to weather patterns, which may adversely affect our results of operations. For example, prolonged winter conditions, reduced rainfall levels or excessive rain, may limit access to boating locations or render boating dangerous or inconvenient, thereby curtailing customer demand for our products and services. In addition, unseasonably cool weather and prolonged winter conditions may lead to a shorter selling season in certain locations. Hurricanes, tornadoes, and other storms have and could result in disruptions of our operations or damage to our boat inventories and facilities, as has been the case when Florida, Texas, and other markets were affected by hurricanes. We believe our geographic diversity is likely to reduce the overall impact to us of adverse weather conditions in any one market area.
Liquidity and Capital Resources
Overview
OneWater Inc. is a holding company with no operations and is the sole managing member of OneWater LLC. OneWater Inc.’s principal asset consists of common units of OneWater LLC. Our earnings and cash flows and ability to meet our obligations under the A&R Credit Facility (as defined below), and any other debt obligations will depend on the cash flows resulting from the operations of our operating subsidiaries, and the payment of distributions by such subsidiaries. Our A&R Credit Facility and Inventory Financing Facility (described below) (together, the “Credit Facilities”) contain certain restrictions on distributions or transfers from our operating subsidiaries to their members or unitholders, as applicable, as described in the summaries below under “—Debt Agreements—A&R Credit Facility” and “—Inventory Financing Facility.” Accordingly, the operating results of our subsidiaries may not be sufficient for them to make distributions to us. As a result, our ability to make payments under the A&R Credit Facility and any other debt obligations or to declare dividends could be limited.
Our cash needs are primarily for growth through acquisitions and working capital to support our operations, including new and pre-owned boat and related parts inventories and off-season liquidity. We routinely monitor our cash flow to determine the amount of cash available to complete acquisitions. We monitor our inventories, inventory aging and current market trends to determine our current and future inventory and related floorplan financing needs. Based on current facts and circumstances, we believe we will have adequate cash flow from operations, borrowings under our Credit Facilities and proceeds from any future public or private issuances of debt or equity to fund our current operations, to make share repurchases and to fund essential capital expenditures and acquisitions for the next twelve months and beyond.
Cash needs for acquisitions have historically been financed with our Credit Facilities and cash generated from operations. Our ability to utilize the A&R Credit Facility to fund acquisitions depends upon Adjusted EBITDA and compliance with covenants of the A&R Credit Facility. Cash needs for inventory have historically been financed with our Inventory Financing Facility. Our ability to fund inventory purchases and operations depends on the collateral levels and our compliance with the covenants of the Inventory Financing Facility. For the reporting period ended December 31, 2024, we were in compliance with all covenants under the A&R Credit Facility and the Inventory Financing Facility.
We have no material off balance sheet arrangements.
Cash Flows
Analysis of Cash Flow Changes Between the Three Months Ended December 31, 2024 and 2023
The following table summarizes our cash flows for the periods indicated:
Three Months Ended December 31,
($ in thousands)20242023Change
Net cash used in operating activities$(37,442)$(110,034)$72,592 
Net cash (used in) provided by investing activities(2,776)39,807 (42,583)
Net cash provided by financing activities49,419 31,079 18,340 
Effect of exchange rate changes on cash and restricted cash20 (9)29 
Net change in cash$9,221 $(39,157)$48,378 
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Operating Activities. Net cash used in operating activities was $37.4 million for the three months ended December 31, 2024 compared to net cash used in operating activities of $110.0 million for the three months ended December 31, 2023. The $72.6 million decrease in cash used in operating activities was primarily attributable to a $51.4 million decrease in the change in inventory and a $31.9 million decrease in the change in prepaid expenses and other current assets, offset by a $9.8 million decrease in the change in customer deposits for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Investing Activities. Net cash used in investing activities was $2.8 million for the three months ended December 31, 2024 compared to net cash provided by investing activities of $39.8 million for the three months ended December 31, 2023. The $42.6 million increase in cash used in investing activities was primarily attributable to a $45.1 million decrease in proceeds from the disposal of a business, offset by a $2.3 million decrease in cash used in purchases of property and equipment for the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Financing Activities. Net cash provided by financing activities was $49.4 million for the three months ended December 31, 2024 compared to net cash provided by financing activities of $31.1 million for the three months ended December 31, 2023. The $18.3 million increase in financing cash flow was primarily attributable to the $18.8 million payment to purchase the non-controlling interest of Quality Assets & Operations, LLC during the three months ended December 31, 2023 and a $35.0 million decrease in payments on long-term debt, partially offset by an $11.1 million decrease in proceeds from long-term debt and a $27.1 million decrease in net borrowings from floor plan during the three months ended December 31, 2024 as compared to the three months ended December 31, 2023.
Share Repurchase Program
On March 30, 2022 the Board authorized a share repurchase program of up to $50 million of outstanding shares of Class A common stock. Repurchases under the share repurchase program may be made at any time or from time to time, without prior notice, in the open market or in privately negotiated transactions at prevailing market prices, or such other means as will comply with applicable state and federal securities laws and regulations, including the provisions of the Securities Exchange Act of 1934, including Rule 10b5-1 and, to the extent practicable or advisable, Rule 10b-18 thereunder, and consistent with the Company’s contractual limitations and other requirements. The Company made no share repurchases during the three months ended December 31, 2024. The Company has $48.1 million remaining under the share repurchase program.
Debt Agreements
A&R Credit Facility
On August 9, 2022 we entered into the Amended and Restated Credit Agreement (the “A&R Credit Facility”), with certain of our subsidiaries, Truist Bank and the other lenders party thereto. The A&R Credit Facility provides for, among other things, (i) a $65.0 million revolving credit facility (including up to $5.0 million in swingline loans and up to $5.0 million in letters of credit from time to time) and (ii) a $445.0 million term loan facility. Subject to certain conditions, the available amount under the Term Facility and the Revolving Facility may be increased by $125.0 million plus additional amounts subject to additional conditions (including satisfaction of a consolidated leverage ratio requirement) in the aggregate (with up to $50.0 million allocable to the Revolving Facility). On November 13, 2024 we entered into Amendment No. 6 to the Amended and Restated Credit Agreement and Waiver and Amendment No. 1 to Pledge and Security Agreement with Truist Bank to, among other things, (i) modify certain definitions, terms and conditions, (ii) adjust the minimum fixed charge coverage ratio, (iii) adjust the maximum leverage ratio measures, (iv) adjust the minimum liquidity measure, and (v) modify the maturity date to be July 31, 2026, and in connection therewith, the repayment schedule. The Revolving Facility matures on July 31, 2026. The Term Facility is repayable in installments beginning on December 31, 2022, with the remainder due on the earlier of (i) July 31, 2026 or (ii) the date on which the principal amount of all outstanding term loans have been declared or automatically have become due and payable pursuant to the terms of the A&R Credit Facility.
Borrowings under the A&R Credit Facility bear interest, at our option, at either (a) a base rate (the “Base Rate”) equal to the highest of (i) the prime rate (as announced by Truist Bank from time to time), (ii) the Federal Funds Rate, as in effect from time to time, plus 0.50%, (iii) Term SOFR (as defined in the A&R Credit Facility) for a one-month Interest Period (calculated on a daily basis after taking into account a floor equal to 0.00%) plus 1.00%, and (iv) 1.00%, in each case, plus an applicable margin ranging from 0.75% to 1.75%, or (b) Term SOFR, plus an applicable margin ranging from 0.75% to 1.75%. Interest on swingline loans shall bear interest at the Base Rate plus an applicable margin ranging from 1.75% to 2.75%. All applicable interest margins are based on certain consolidated leverage ratio measures.
The A&R Credit Facility is subject to certain financial covenants including the maintenance of a minimum fixed charge coverage ratio, a maximum consolidated leverage ratio and a minimum liquidity measure. The A&R Credit Facility also contains non-financial covenants and restrictive provisions that, among other things, limit the ability of the Loan Parties (as defined in the A&R Credit Facility) to incur additional debt, transfer or dispose of all of their respective assets, make certain investments, loans or restricted payments and engage in certain transactions with affiliates. The A&R Credit Facility also includes events of default, borrowing conditions, representations and warranties and provisions regarding indemnification and expense reimbursement. The Company was in compliance with all covenants for the reporting period ended December 31, 2024.
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Inventory Financing Facility
On November 14, 2023, we entered into the Eighth Amended and Restated Inventory Financing Agreement (as amended, restated, supplemented or otherwise modified, the “Inventory Financing Facility”) with certain of our subsidiaries, Wells Fargo Commercial Distribution Finance, LLC and the other lender parties thereto. On November 13, 2024, we entered into the Consent, Waiver and Second Amendment to the Eighth Amended and Restated Inventory Financing Agreement with Wells Fargo and other lenders party thereto which, (i) modified certain definitions, terms and conditions, (ii) adjusted the minimum fixed charge coverage ratio, (iii) adjusted the maximum funded debt to EBITDA ratio, (iv) established a new minimum liquidity measure, (v) allowed for certain swap transactions to mitigate risk in the ordinary course of business, and (vi) reduced the maximum borrowing capacity from $650 million to $595 million. Loans under the Inventory Financing Facility may be extended from time to time to enable the Company to purchase inventory from certain manufacturers. The Inventory Financing Facility expires on March 1, 2026.
Under the Inventory Financing Facility, interest on new boats and for rental units is calculated using the Adjusted 30-Day Average SOFR plus an applicable margin of 2.75% to 5.00% depending on the age of the inventory. Interest on pre-owned boats is calculated at the new boat rate plus 0.25%. Loans are extended from time to time to enable us to purchase inventory from certain manufacturers and to lease certain boats and related parts to customers. The applicable financial terms, curtailment schedule and maturity for each loan are set forth in separate program terms letters that are entered into from time to time. The collateral for the Inventory Financing Facility consists primarily of our inventory that was financed through the Inventory Financing Facility and related assets, including accounts receivable, bank accounts, and proceeds of the foregoing, and excludes the collateral that secures the A&R Credit Facility.
We are required to comply with certain financial and non-financial covenants under the Inventory Financing Facility, including certain provisions related to the Funded Debt to EBITDA Ratio, the Fixed Charge Coverage Ratio and the Liquidity measure (as defined in the Inventory Financing Facility). We are also subject to additional restrictive covenants, including restrictions on our ability to (i) use, sell, rent or otherwise dispose of any collateral securing the Inventory Financing Facility except for the sale of inventory in the ordinary course of business, (ii) incur certain liens, (iii) engage in any material transaction not in the ordinary course of business, (iv) change our business in any material manner or our organizational structure, other than as otherwise provided for in the Inventory Financing Facility, (v) engage in certain mergers or consolidations, (vi) acquire certain assets or ownership interests of any other person or entities, except for certain permitted acquisitions, (vii) guarantee or indemnify or otherwise become in any way liable with respect to certain obligations of any other person or entity, except as provided by the Inventory Financing Facility, (viii) redeem, retire, purchase or otherwise acquire, directly or indirectly, any of the equity of our acquired marine retailers (ix) make any change in any of our marine retailers’ capital structure or in any of their business objectives or operations which might in any way adversely affect the ability of such marine retailer to repay its obligations under the Inventory Financing Facility, (x) incur, create, assume, guarantee or otherwise become or remain liable with respect to certain indebtedness, and (xi) make certain payments of subordinated debt. OneWater LLC and certain of its subsidiaries are restricted from, among other things, making cash dividends or distributions without the prior written consent of Wells Fargo. Under the Inventory Financing Facility, among other exceptions, OneWater LLC may make distributions to its members for certain permitted tax payments subject to certain financial ratios, may make scheduled payments on certain subordinated debt, may make distributions to the Company for repurchases of the Company's common stock subject to certain financial ratios, and is permitted to make pro rata distributions to the OneWater Unit Holders, including OneWater Inc., in an amount sufficient to allow OneWater Inc. to pay its taxes and to make payments under the Tax Receivable Agreement. OneWater LLC’s subsidiaries are generally restricted from making loans or advances to OneWater LLC. Our Chief Executive Officer, Philip Austin Singleton, Jr., and our President and Chief Operating Officer, Anthony Aisquith, provide certain personal guarantees of the Inventory Financing Facility.
As of December 31, 2024 and September 30, 2024, our indebtedness associated with financing our inventory under the Inventory Financing Facility totaled $490.1 million and $443.4 million, respectively. Certain of our manufacturers enter into independent agreements with the lenders to the Inventory Financing Facility, which results in a lower effective interest rate charged to us for borrowings related to the products by such manufacturer. For the three months ended December 31, 2024 and the year ended September 30, 2024, the effective interest rate on the outstanding short-term borrowings under the Inventory Financing Facility was 5.8% and 6.6%, respectively. As of December 31, 2024 and September 30, 2024, our additional available borrowings under our Inventory Financing Facility were $104.9 million and $206.6 million, respectively, based upon the outstanding borrowings and the maximum facility amount. The aging of our inventory limits our borrowing capacity as defined curtailments reduce the allowable advance rate as our inventory ages. For the reporting period ended December 31, 2024, we were in compliance with all covenants under the Inventory Financing Facility.
Notes Payable
Acquisition Notes Payable. In connection with certain of our acquisitions of dealer groups, we have from time to time entered into notes payable agreements with the acquired entities to finance these acquisitions. As of December 31, 2024, we have no indebtedness associated with acquisition notes payable.
Commercial Vehicles Notes Payable. Since 2015, we have entered into multiple notes payable with various commercial lenders in connection with our acquisition of certain vehicles utilized in our retail operations. Such notes bear interest ranging from 0.0% to 10.8% per annum, require monthly payments of approximately $102,000, and mature on dates between January 2025 to April 2029. As of December 31, 2024, we had $2.3 million outstanding under the commercial vehicles notes payable.
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Tax Receivable Agreement
The Tax Receivable Agreement generally provides for the payment by OneWater Inc. to each TRA Holder of 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax (computed using the estimated impact of state and local taxes) that OneWater Inc. actually realizes (or is deemed to realize in certain circumstances) in periods after the IPO as a result of certain tax basis increases and certain tax benefits attributable to imputed interest. OneWater Inc. will retain the benefit of the remaining net cash savings.
As of December 31, 2024 and September 30, 2024, our liability under the Tax Receivable Agreement was $40.6 million. To the extent OneWater LLC has available cash and subject to the terms of any current or future debt or other agreements, the OneWater LLC Agreement will require OneWater LLC to make pro rata cash distributions to TRA Holders, including OneWater Inc., in an amount sufficient to allow OneWater Inc. to pay its taxes and to make payments under the Tax Receivable Agreement. We generally expect OneWater LLC to fund such distributions out of available cash. However, except in cases where OneWater Inc. elects to terminate the Tax Receivable Agreement early, the Tax Receivable Agreement is terminated early due to certain mergers or other changes of control or OneWater Inc. has available cash but fails to make payments when due; generally OneWater Inc. may elect to defer payments due under the Tax Receivable Agreement if it does not have available cash to satisfy its payment obligations under the Tax Receivable Agreement or if its contractual obligations limit its ability to make these payments. Any such deferred payments under the Tax Receivable Agreement generally will accrue interest. In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual benefits, if any, OneWater Inc. realizes in respect of the tax attributes subject to the Tax Receivable Agreement. In the case of such an acceleration, where applicable, we generally expect the accelerated payments due under the Tax Receivable Agreement to be funded out of the proceeds of the change of control transaction giving rise to such acceleration. OneWater Inc. intends to account for any amounts payable under the Tax Receivable Agreement in accordance with ASC Topic 450, Contingencies.
Recent Accounting Pronouncements
See Note 3 of the Notes to the Condensed Consolidated Financial Statements.
Item 3.    Quantitative and Qualitative Disclosure about Market Risk
Interest Rate Risk
Our Inventory Financing Facility exposes us to risks caused by fluctuations in interest rates. The interest rate on our Inventory Financing Facility for major unit inventory is calculated using SOFR plus an applicable margin. Based on the $290.1 million balance under the Inventory Financing Facility that is not covered by interest rate swaps as of December 31, 2024, a change of 100 basis points in the underlying interest rate would cause a change in interest expense of approximately $2.9 million. This hypothetical increase does not take into account a corresponding increase to the programs that we may receive from our manufacturers or management’s ability to curtail inventory and related floor plan balances, both of which would reduce the impact of the interest rate increase.
Our A&R Credit Facility exposes us to risks caused by fluctuations in interest rates. The interest rate on our A&R Credit Facility is calculated using Term SOFR (with a 0.00% floor) plus an applicable margin. Based on the $233.5 million outstanding balance that is not covered by interest rate swaps as of December 31, 2024, a change of 100 basis points in the underlying interest rate would cause a change in interest expense of approximately $2.3 million.
As part of our strategy to mitigate the exposure risk to fluctuations in interest rates for our Inventory Financing Facility and A&R Credit Facility, we may enter into various interest rate swap agreements. As of December 31, 2024, we had two interest rate swap agreements with a combined notional amount of $400.0 million. The swaps are designed to provide a hedge against the changes in variable cash flows regarding fluctuations in the SOFR and Term SOFR rates which are used in calculating interest payments. All of our interest rates swaps qualify for cash flow hedge accounting. The following table provides information regarding our interest rate swaps as of December 31, 2024:
Inception DateHedged RateNotional Value at Inception (in thousands)Maturity Date
September 2024SOFR$200,000 September 2027
September 2024Term SOFR200,000 September 2027
Foreign Currency Risk
We purchase certain of our new boat and parts inventories from foreign manufacturers and some of these transactions are denominated in a currency other than the U.S. dollar. Our business is subject to foreign exchange rate risk that may influence manufacturers’ ability to provide their products at competitive prices in the United States. From time to time we may enter into foreign currency forward contracts to hedge certain foreign currency exposures to lessen, but not completely eliminate, the effects of foreign currency fluctuations on our financial results. To the extent that we cannot recapture this volatility in prices charged to customers or if this volatility negatively impacts consumer demand for our products, this volatility could adversely affect our future operating results.
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Item 4.    Controls and Procedures
Disclosure Controls and Procedures
Under the supervision and with the participation of our management, including the Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of such date. No system of controls, no matter how well designed and operated, can provide absolute assurance that the objectives of the system of controls are met, and no evaluation of controls can provide absolute assurance that the system of controls has operated effectively in all cases. Our disclosure controls and procedures are designed to provide reasonable assurance that the objectives of disclosure controls and procedures are met and to ensure that information required to be disclosed in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f)) during the three months ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II – OTHER INFORMATION
Item 1.    Legal Proceedings
We are involved in various legal proceedings as either the defendant or plaintiff. Due to their nature, such legal proceedings involve inherent uncertainties including, but not limited to, court rulings, negotiations between the affected parties and other actions. Management assess the probability of losses or gains for such contingencies and accrues a liability and/or discloses the relevant circumstances as appropriate. In the opinion of management, it is not reasonably probable that the pending litigation, disputes or claims against the Company as of December 31, 2024, will have a material adverse effect on its financial condition, results of operations or cash flows. However, the outcome of any matter cannot be predicted with certainty, and an unfavorable resolution of one or more matters presently known or arising in the future could have a material adverse effect on the Company's financial condition, liquidity or results of operations.
Item 1A.    Risk Factors
In addition to the information set forth in this Quarterly Report on Form 10-Q, you should carefully consider the risk factors and other cautionary statements described under the heading “Risk Factors” included in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024, filed with the SEC on December 10, 2024, which could materially affect our businesses, financial condition, or future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, or future results. There have been no material changes in our risk factors from those described in our Annual Report on Form 10-K for the fiscal year ended September 30, 2024, filed with the SEC on December 10, 2024.
Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds
Issuer's Purchases of Equity Securities
On March 30, 2022, the Board authorized a share repurchase program of up to $50 million of outstanding shares of Class A common stock. Repurchases under the share repurchase program may be made at any time or from time to time, without prior notice, in the open market or in privately negotiated transactions at prevailing market prices, or such other means as will comply with applicable state and federal securities laws and regulations, including the provisions of the Securities Exchange Act of 1934, including, to the extent practicable or advisable, Rule 10b5-1 and Rule 10b-18 thereunder, and consistent with the Company’s contractual limitations and other requirements. The Company made no repurchases in the three months ended December 31, 2024. The Company has $48.1 million remaining under the share repurchase program.
Item 3.    Defaults Upon Senior Securities
None.
Item 4.    Mine Safety Disclosures
Not Applicable.
Item 5.    Other Information
None.
40


Item 6.    Exhibits
Exhibit No.Description
Amendment No. 6 to the Amended and Restated Credit Agreement and Waiver and Amendment No. 1 to Pledge and Security Agreement, dated as of November 13, 2024, by and among One Water Assets & Operations, LLC, One Water Marine Holdings, LLC, OneWater Marine Inc. and certain of its subsidiaries from time to time, the lenders from time to time party thereto, and Truist Bank as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, File No. 001-39213, filed with the Commission on November 13, 2024).
Consent, Waiver and Second Amendment to the Eighth Amended and Restated Inventory Financing Agreement, dated as of November 13, 2024, between Wells Fargo Commercial Distribution Finance, LLC as Agent for the several financial institutions that may from time to time become party thereto and Dealers that may from time to time become party thereto (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, File No. 001-39213, filed with the Commission on November 13, 2024).
Certification of the Chief Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a).
Certification of the Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a).
Certification of the Chief Executive Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
Certification of the Chief Financial Officer required by Rule 13a-14(b) or Rule 15d-14(b) and 18 U.S.C. 1350.
101.INS(a)Inline XBRL Instance Document.
101.SCH(a)Inline XBRL Schema Document.
101.CAL(a)Inline XBRL Calculation Linkbase Document.
101.DEF(a)Inline XBRL Definition Linkbase Document.
101.LAB(a)Inline XBRL Labels Linkbase Document.
101.PRE(a)Inline XBRL Presentation Linkbase Document.
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
*Filed herewith.
**Furnished herewith.
41


SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
ONEWATER MARINE INC.
(Registrant)
By:/s/ Philip Austin Singleton, Jr.
Philip Austin Singleton, Jr.
Chief Executive Officer
By:/s/ Jack Ezzell
Jack Ezzell
Chief Financial Officer
January 31, 2025
42

Exhibit 31.1
CERTIFICATION
PURSUANT TO EXCHANGE ACT RULE 13A-14(a) OR RULE 15D-14(a)
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Philip Austin Singleton, Jr., certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of OneWater Marine Inc. (the “registrant”) for the quarter ended December 31, 2024;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Dated: January 31, 2025
By:/s/ Philip Austin Singleton, Jr.
Philip Austin Singleton, Jr.
Chief Executive Officer
(Principal Executive Officer)

Exhibit 31.2
CERTIFICATION
PURSUANT TO EXCHANGE ACT RULE 13A-14(a) OR RULE 15D-14(a)
AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Jack Ezzell, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of OneWater Marine Inc. (the “registrant”) for the quarter ended December 31, 2024;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Dated: January 31, 2025
By:/s/ Jack Ezzell
Jack Ezzell
Chief Financial Officer
(Principal Financial Officer)

Exhibit 32.1
CERTIFICATION
PURSUANT TO 18 U.S.C. § 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of OneWater Marine Inc. (the “Company”) for the quarter ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Philip Austin Singleton, Jr., Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: January 31, 2025
By:/s/ Philip Austin Singleton, Jr.
Philip Austin Singleton, Jr.
Chief Executive Officer
(Principal Executive Officer)

Exhibit 32.2
CERTIFICATION
PURSUANT TO 18 U.S.C. § 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of OneWater Marine Inc. (the “Company”) for the quarter ended December 31, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Jack Ezzell, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
Dated: January 31, 2025
By:/s/ Jack Ezzell
Jack Ezzell
Chief Financial Officer
(Principal Financial Officer)

v3.24.4
Cover - shares
3 Months Ended
Dec. 31, 2024
Jan. 24, 2025
Document Information [Line Items]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Dec. 31, 2024  
Document Transition Report false  
Entity File Number 001-39213  
Entity Registrant Name OneWater Marine Inc.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 83-4330138  
Entity Address, Address Line One 6275 Lanier Islands Parkway  
Entity Address, City or Town Buford  
Entity Address, State or Province GA  
Entity Address, Postal Zip Code 30518  
City Area Code 678  
Local Phone Number 541-6300  
Title of 12(b) Security Class A common stock, par value $0.01 per share  
Trading Symbol ONEW  
Security Exchange Name NASDAQ  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Central Index Key 0001772921  
Current Fiscal Year End Date --09-30  
Document Fiscal Year Focus 2025  
Document Fiscal Period Focus Q1  
Amendment Flag false  
Class A Common Stock    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   16,028,219
Class B Common Stock    
Document Information [Line Items]    
Entity Common Stock, Shares Outstanding   284,896
v3.24.4
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
$ in Thousands
Dec. 31, 2024
Sep. 30, 2024
CURRENT ASSETS:    
Cash $ 22,711 $ 16,849
Restricted cash 13,847 10,488
Accounts receivable, net 56,912 73,269
Inventories 636,676 590,838
Prepaid expenses and other current assets 67,328 85,922
Total current assets 797,474 777,366
Property and equipment, net 91,499 93,224
Operating lease right-of-use assets 136,275 138,829
Other long-term assets 4,911 1,299
Deferred tax assets, net 41,154 37,278
Intangible assets, net 203,631 205,391
Goodwill 336,602 336,602
Total assets 1,611,546 1,589,989
CURRENT LIABILITIES:    
Accounts payable 29,266 32,106
Other payables and accrued expenses 38,055 42,116
Customer deposits 53,454 63,955
Notes payable – floor plan 490,107 443,386
Current portion of operating lease liabilities 15,752 15,704
Current portion of long-term debt, net 15,672 7,874
Current portion of tax receivable agreement liability 2,578 2,578
Total current liabilities 644,884 607,719
Other long-term liabilities 9,105 12,563
Tax receivable agreement liability 38,019 38,019
Long-term operating lease liabilities 123,330 126,001
Long-term debt, net 412,590 414,934
Total liabilities 1,227,928 1,199,236
Commitments and Contingencies
STOCKHOLDERS’ EQUITY    
Preferred stock, $0.01 par value, 1,000,000 shares authorized, none issued and outstanding as of December 31, 2024 and September 30, 2024 0 0
Additional paid-in capital 203,267 202,921
Retained earnings 147,654 159,625
Accumulated other comprehensive income (loss) 3,694 (1,897)
Total stockholders’ equity attributable to OneWater Marine Inc. 354,777 360,810
Equity attributable to non-controlling interests 28,841 29,943
Total stockholders’ equity 383,618 390,753
Total liabilities and stockholders’ equity 1,611,546 1,589,989
Class A Common Stock    
STOCKHOLDERS’ EQUITY    
Common stock value 148 147
Class B Common Stock    
STOCKHOLDERS’ EQUITY    
Common stock value $ 14 $ 14
v3.24.4
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
Dec. 31, 2024
Sep. 30, 2024
Preferred stock, par or stated value per share (in usd per shares) $ 0.01 $ 0.01
Preferred stock, shares authorized (in shares) 1,000,000 1,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Class A Common Stock    
Common stock, par or stated value per share (in usd per shares) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 40,000,000 40,000,000
Common stock, shares, issued (in shares) 14,847,008 14,686,696
Common stock, shares, outstanding (in shares) 14,847,008 14,686,696
Class B Common Stock    
Common stock, par or stated value per share (in usd per shares) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 10,000,000 10,000,000
Common stock, shares, issued (in shares) 1,429,940 1,429,940
Common stock, shares, outstanding (in shares) 1,429,940 1,429,940
v3.24.4
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Thousands, $ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Revenues:    
Total revenues $ 375,814 $ 364,013
Cost of sales:    
Total cost of sales 291,760 272,570
Selling, general and administrative expenses 79,060 79,599
Depreciation and amortization 5,315 4,222
Transaction costs 559 579
Change in fair value of contingent consideration 242 572
Restructuring and impairment 851 0
(Loss) income from operations (1,973) 6,471
Other expense (income):    
Interest expense – floor plan 7,026 7,812
Interest expense – other 8,988 9,152
Other expense (income), net 887 (247)
Total other expense, net 16,901 16,717
Net loss before income tax benefit (18,874) (10,246)
Income tax benefit (5,262) (2,276)
Net loss (13,612) (7,970)
Net (income) attributable to non-controlling interests 0 (119)
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC 1,641 919
Net loss attributable to OneWater Marine Inc. (11,971) (7,170)
New boat    
Revenues:    
Total revenues 247,997 241,084
Cost of sales:    
Total cost of sales 211,121 196,403
Pre-owned boat    
Revenues:    
Total revenues 56,798 53,283
Cost of sales:    
Total cost of sales 45,582 41,346
Finance & insurance income    
Revenues:    
Total revenues 9,400 7,360
Service, parts & other    
Revenues:    
Total revenues 61,619 62,286
Cost of sales:    
Total cost of sales $ 35,057 $ 34,821
Class A Common Stock    
Other expense (income):    
Net (loss) earnings per share of Class A common stock – basic (in usd per share) $ (0.81) $ (0.49)
Net (loss) earnings per share of Class A common stock - diluted (in usd per share) $ (0.81) $ (0.49)
Basic weighted-average shares of Class A common stock outstanding (in shares) 14,831 14,540
Diluted weighted-average shares of Class A common stock outstanding (in shares) 14,831 14,540
v3.24.4
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Statement of Comprehensive Income [Abstract]    
Net loss $ (13,612) $ (7,970)
Other comprehensive income (loss):    
Foreign currency translation adjustment 20 (9)
Change in fair value of interest rate swaps, net of reclassification adjustment 7,289 0
Income tax expense associated with other comprehensive income items (1,179) 0
Comprehensive loss (7,482) (7,979)
Net (income) attributable to non-controlling interests 0 (119)
Net loss attributable to non-controlling interests of One Water Marine Holdings, LLC 1,641 919
Foreign currency translation adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC (2) 1
Change in fair value of interest rate swaps, net of reclassification adjustment attributable to non-controlling interest of One Water Marine Holdings, LLC (640) 0
Income tax expense associated with other comprehensive income items attributable to non-controlling interest of One Water Marine Holdings, LLC 103 0
Comprehensive loss attributable to OneWater Marine Inc. $ (6,380) $ (7,178)
v3.24.4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($)
$ in Thousands
Total
Class A Common Stock
Class B Common Stock
Common Stock
Class A Common Stock
Common Stock
Class B Common Stock
Additional Paid-in Capital
Retained Earnings
Non-controlling Interest
Accumulated Other Comprehensive Income (Loss)
Beginning balance (in shares) at Sep. 30, 2023       14,420,000 1,430,000        
Beginning balance at Sep. 30, 2023 $ 414,078     $ 144 $ 14 $ 193,018 $ 165,432 $ 55,469 $ 1
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net loss (7,970)           (7,170) (800)  
Shares issued upon vesting of equity-based awards, net of tax withholding (in shares)       124,000          
Distributions to members (3,789)           0 (3,789)  
Purchase of non-controlling interest (18,840)         716   (19,556)  
Shares issued upon vesting of equity-based awards, net of tax withholding (1,552)     $ 1   (1,553)      
Equity-based compensation 2,392         2,392      
Currency translation adjustment (9)             (1) (8)
Ending balance (in shares) at Dec. 31, 2023       14,544,000 1,430,000        
Ending balance at Dec. 31, 2023 384,310     $ 145 $ 14 194,573 158,262 31,323 (7)
Beginning balance (in shares) at Sep. 30, 2024   14,686,696 1,429,940 14,687,000 1,430,000        
Beginning balance at Sep. 30, 2024 390,753     $ 147 $ 14 202,921 159,625 29,943 (1,897)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                  
Net loss (13,612)           (11,971) (1,641)  
Shares issued upon vesting of equity-based awards, net of tax withholding (in shares)       160,000          
Shares issued upon vesting of equity-based awards, net of tax withholding (1,823)     $ 1   (1,824)      
Equity-based compensation 2,170         2,170      
Currency translation adjustment 20             2 18
Change in fair value of interest rate swaps, net of reclassification adjustment and tax expense 6,110             537 5,573
Ending balance (in shares) at Dec. 31, 2024   14,847,008 1,429,940 14,847,000 1,430,000        
Ending balance at Dec. 31, 2024 $ 383,618     $ 148 $ 14 $ 203,267 $ 147,654 $ 28,841 $ 3,694
v3.24.4
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical)
$ in Thousands
3 Months Ended
Dec. 31, 2024
USD ($)
Statement of Stockholders' Equity [Abstract]  
Tax expense $ 1,200
v3.24.4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net loss $ (13,612) $ (7,970)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 6,037 4,905
Equity-based awards 2,170 2,392
Loss (gain) on asset disposals 183 (34)
Non-cash interest expense 933 484
Deferred income tax provision (5,056) 1,828
Change in fair value of contingent consideration 242 572
Net (gain) loss recognized during the period on equity securities (7) 112
(Increase) decrease in assets:    
Accounts receivable 16,357 20,240
Inventories (45,798) (97,223)
Prepaid expenses and other current assets 19,468 (12,388)
Other assets (880) (1,869)
Increase (decrease) in liabilities:    
Accounts payable (2,840) (8,216)
Other payables and accrued expenses (4,137) (12,196)
Customer deposits (10,502) (671)
Net cash used in operating activities (37,442) (110,034)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchases of property and equipment and construction in progress (2,603) (4,924)
Proceeds from disposal of property and equipment 189 59
Cash used for additions to intangible assets (362) (428)
Proceeds from disposal of a business 0 45,100
Net cash (used in) provided by investing activities (2,776) 39,807
CASH FLOWS FROM FINANCING ACTIVITIES:    
Net borrowings from floor plan 46,721 73,791
Proceeds from long-term debt 8,890 20,000
Payments on long-term debt (3,434) (38,457)
Payments of debt issuance costs (935) (74)
Payments of tax withholdings for equity-based awards (1,823) (1,552)
Distributions to members 0 (3,789)
Purchase of non-controlling interest 0 (18,840)
Net cash provided by financing activities 49,419 31,079
Effects of exchange rate changes on cash and restricted cash 20 (9)
Net change in cash and restricted cash 9,221 (39,157)
Cash and restricted cash at beginning of period 27,337 93,310
Cash and restricted cash at end of period 36,558 54,153
Supplemental cash flow disclosures:    
Cash paid for interest 15,329 16,480
Cash (received) paid for income taxes and income tax refunds (330) 455
Noncash items:    
Purchase of property and equipment funded by long-term debt 0 82
Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,985 $ 1,931
v3.24.4
Description of Company and Basis of Presentation
3 Months Ended
Dec. 31, 2024
Description of Company and Basis of Presentation [Abstract]  
Description of Company and Basis of Presentation Description of Company and Basis of Presentation
Description of the Business
OneWater Marine Inc. (“OneWater Inc”) was incorporated in Delaware on April 3, 2019 and was a wholly-owned subsidiary of One Water Marine Holdings, LLC (“OneWater LLC”). Pursuant to a reorganization on February 11, 2020 into a holding company structure for the purpose of facilitating an initial public offering (the “IPO”) and related transactions in order to carry on the business of OneWater LLC and its subsidiaries (together with OneWater Inc, the “Company”), OneWater Inc is the holding company and its sole material asset is the equity interest in OneWater LLC. OneWater LLC was organized as a limited liability company under the law of the State of Delaware in 2014 and is the parent company of One Water Assets & Operations (“OWAO”), and its subsidiaries.
The Company is one of the largest recreational marine retailers in the United States. The Company engages primarily in the retail sale, brokerage, and service of new and pre-owned boats, motors, trailers, the sale of marine parts and accessories, and offers slip and storage accommodations in certain locations. The Company also arranges related boat financing, insurance, and extended service contracts for customers with third-party lenders and insurance companies. As of December 31, 2024, the Company operates a total of 96 retail locations, 10 distribution centers/warehouses and multiple online marketplaces in 19 states, several of which are in the top twenty states for marine retail expenditures.
Operating results are generally subject to seasonal variations. Demand for products is generally highest during the third and fourth quarters of the fiscal year and, accordingly, revenues are generally expected to be higher during these periods. General economic conditions, including rising interest rates and consumer spending patterns, can negatively impact the Company’s operating results. Unfavorable local, regional, national, or global economic developments, global public health concerns, or uncertainties could reduce consumer spending and adversely affect the Company’s business. Consumer spending on discretionary goods may also decline as a result of lower consumer confidence levels, even if prevailing economic conditions are otherwise favorable. Economic conditions in areas in which the Company operates, particularly in the Southeast, can have a major impact on the Company’s overall results of operations. Local influences such as corporate downsizing, inclement weather such as hurricanes, tornadoes and other storms, environmental conditions, and other events have and could adversely affect the Company’s operations in certain markets and in certain periods. Any extended period of adverse economic conditions or low consumer confidence is likely to have a negative effect on the Company’s business.
Sales of new boats from the Company’s top ten brands represent approximately 45.7% and 48.9% of total sales for the three months ended December 31, 2024 and 2023, respectively, making them major suppliers of the Company. Of this amount, Malibu Boats, Inc., including its brands Malibu, Axis, Cobalt, Pursuit, Maverick, Hewes, Cobia and Pathfinder accounted for 13.1% and 13.6% of our consolidated revenue for the three months ended December 31, 2024 and 2023, respectively. As is typical in the industry, the Company contracts with most manufacturers under renewable annual dealer agreements, each of which provides the right to sell various makes and models of boats within a given geographic region. Any change or termination of these agreements, for any reason, or changes in competitive, regulatory, or marketing practices, including rebate or incentive programs, could adversely affect results of operations. Pre-owned boats are usually trade-ins from retail customers who are purchasing a boat from the Company.
Principles of Consolidation
As the sole managing member of OneWater LLC, OneWater Inc operates and controls all of the businesses and affairs of OneWater LLC. Through OneWater LLC and its wholly-owned subsidiaries, as well as majority-owned subsidiaries over which the Company exercises control, OneWater Inc conducts its business. As a result, OneWater Inc consolidates the financial results of OneWater LLC and its subsidiaries and reports non-controlling interests related to the portion of units of OneWater LLC (the “OneWater LLC Units”) not owned by OneWater Inc, which will reduce net income (loss) attributable to OneWater Inc’s Class A stockholders. As of December 31, 2024, OneWater Inc owned 91.2% of the economic interest of OneWater LLC.
Commencing December 31, 2021, the Company owned 80% of the economic interest of Quality Assets and Operations, LLC, over which the Company exercised control and the minority interest in this subsidiary was recorded accordingly. On October 31, 2023, the Company acquired the remaining 20% of the economic interest and, as a result, as of December 31, 2024 owned 100% of Quality Assets and Operations, LLC. See Note 4 for additional information regarding the acquisition.
Basis of Financial Statement Preparation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements, which do not include all the information and notes required by such accounting principles for annual financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with OneWater Inc’s Annual Report on Form 10-K for the year ended September 30, 2024. All adjustments, consisting of only normal recurring adjustments considered by management to be necessary for fair presentation, have been reflected in these unaudited condensed consolidated financial statements.
All intercompany transactions have been eliminated in consolidation. The Company operates on a fiscal year basis with the first day of the fiscal year being October 1, and the last day of the fiscal year ending on September 30.
v3.24.4
Summary of Significant Accounting Policies
3 Months Ended
Dec. 31, 2024
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies Summary of Significant Accounting Policies
Cash
At times the amount of cash on deposit may exceed the federally insured limit of the bank. Deposit accounts at each of the institutions are insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC). At December 31, 2024 and September 30, 2024, the Company exceeded FDIC limits at various institutions. The Company has not experienced any losses in such accounts and believes there is little to no exposure to any significant credit risk. Total cash and restricted cash shown in the unaudited condensed consolidated statements of cash flows is comprised of the amounts reported in cash and restricted cash on the unaudited condensed consolidated balance sheets.
Restricted Cash
Restricted cash relates to amounts collected for brokerage sales, in certain states, which are held in escrow on behalf of the respective buyers and sellers for future purchases of boats.
Inventories
Inventories are stated at the lower of cost or net realizable value. The costs of inventories consist of amounts paid to acquire the inventory, net of vendor consideration received and purchase discounts, and, varying by inventory type, may include the cost of reconditioning, equipment addition, transportation, material, labor and manufacturing overhead. The cost of the new and pre-owned boat inventory is determined using the specific identification method. In assessing lower of cost or net realizable value, the Company considers the aging of the boats, historical sales of a brand and current market conditions. The cost of acquired, manufactured and assembled parts and accessories is determined using methods which vary by subsidiary and include the average cost method, standard costs (which approximate average costs) and first-in, first-out (“FIFO”).
Goodwill and Other Identifiable Intangible Assets
Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Other identifiable intangible assets primarily consist of trade names, developed technologies, and customer relationships related to the acquisitions the Company has completed. The Company has determined that trade names have an indefinite life, as there are no economic, contractual or other factors that limit their useful lives and they are expected to generate value as long as the trade name is utilized by the Company, and therefore, are not subject to amortization. Developed technologies and customer relationships are amortized over their estimated useful lives of ten years. Goodwill and indefinite-lived intangible assets are accounted for in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, ‘‘Intangibles – Goodwill and Other’’ (‘‘ASC 350’’), which provides that the excess of cost over the fair value of the net assets of businesses acquired, including other identifiable intangible assets, is recorded as goodwill.
In accordance with ASC 350, Goodwill and indefinite-lived intangible assets are tested for impairment at least annually, or more frequently when events or circumstances indicate that impairment might have occurred. ASC 350 also states for annual impairment tests that if an entity determines, based on an assessment of certain qualitative factors, that it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is greater than its carrying amount, then a quantitative impairment test is unnecessary. The Company performs its annual test in the fiscal fourth quarter.
In accordance with FASB ASC 360-10, "Property, Plant and Equipment – Impairment or Disposal of Long-Lived Assets" (“ASC 360”), the Company assesses the potential for impairment of its definite-lived intangible assets if facts and circumstances, such as declines in sales, earnings, cash flows or adverse changes in the business climate, suggest that they may be impaired. Definite-lived intangible assets include developed technologies and customer relationships which are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.
Sales Tax
The Company collects sales tax on all of the Company’s sales to nonexempt customers and remits the entire amount to the states that imposed the sales tax. The Company’s accounting policy is to exclude the tax collected and remitted to the states from revenues and cost of sales.
Revenue Recognition
Revenue is recognized from the sale of products and commissions earned on new and pre-owned boats (including used, brokerage, consignment and wholesale) when ownership is transferred to the customer, which is generally upon acceptance by or delivery to the customer. At the time of acceptance or delivery, the customer is able to direct the use of, and obtain substantially all of the benefits. We are the principal with respect to revenue from new, pre-owned and consignment sales and such revenue is recorded at the gross sales price. With respect to brokerage transactions, we are acting as an agent in the transaction, therefore the fee or commission is recorded on a net basis.
Revenue from parts and accessories sold directly to a customer (not on a repair order) is recognized when control of the item is transferred to the customer, which is typically upon shipment. Revenue from parts and service operations (boat maintenance and repairs) is recorded over time as services are performed. Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements. Each boat maintenance and repair service is a single performance obligation that includes both the parts and labor associated with the service. Payment for boat maintenance and repairs is typically due upon the completion of the service, which is generally completed within a period of one year or less from contract inception. The Company recorded contract assets in prepaid expenses and other current assets of $4.3 million and $4.2 million as of December 31, 2024 and September 30, 2024, respectively.
Certain parts and service transactions require the Company to perform shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery). They are considered fulfillment activities and are included in selling, general and administrative expenses.
Revenue from storage and marina operations is recognized on a straight-line basis over the term of the contract as services are completed. Revenue from arranging financing, insurance and extended warranty contracts to customers through various third-party financial institutions and insurance companies is recognized when the related boats are sold. We do not directly finance our customers’ boat, motor or trailer purchases. We are acting as an agent in the transaction, therefore the commissions are recorded on a net basis. Subject to our agreements and in the event of early cancellation, prepayment or default of such loans or insurance contracts by the customer, we may be assessed a chargeback for a portion of the commission paid by the third-party financial institutions and insurance companies. We reserve for these chargebacks based on our historical experience with repayments or defaults. Chargebacks were not material to the unaudited condensed consolidated financial statements for the three months ended December 31, 2024 and 2023.
Contract liabilities consist of deferred revenues from marina and storage operations and customer deposits and are classified in customer deposits in the Company’s unaudited condensed consolidated balance sheets. Deposits received from customers are recorded as a liability until the related sales orders have been fulfilled by us and control of the vessel is transferred to the customer. The activity in customer deposits for the three months ended December 31, 2024 and 2023 is as follows:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Beginning contract liability$63,955 $51,649 
Revenue recognized from contract liabilities included in the beginning balance(38,408)(31,378)
Increases due to cash received, net of amounts recognized in revenue during the period27,907 30,706 
Ending contract liability$53,454 $50,977 
The following table sets forth percentages on the timing of revenue recognition for the three months ended December 31, 2024 and 2023.
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Goods and services transferred at a point in time92.6 %92.7 %
Goods and services transferred over time7.4 %7.3 %
Total Revenue100.0 %100.0 %
Income Taxes
OneWater Inc is a corporation and as a result, is subject to U.S. federal, state and local income taxes. We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events included in the consolidated financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the book value and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period in which the enactment date occurs. We recognize deferred tax assets to the extent we believe these assets are more-likely-than-not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations.
OneWater LLC is treated as a partnership for U.S. federal income tax purposes and therefore does not pay U.S. federal income tax on its taxable income. Instead, the OneWater LLC members are liable for U.S. federal income tax on their respective shares of the Company’s taxable income reported on the members’ U.S. federal income tax returns.
When there are situations with uncertainty as to the timing of the deduction, the amount of the deduction, or the validity of the deduction, the Company adjusts the financial statements to reflect only those tax positions that are more-likely-than-not to be sustained. Positions that meet this criterion are measured using the largest benefit that is more than 50% likely to be realized. Interest and penalties related to income taxes are included in the benefit (provision) for income taxes in the consolidated statements of operations.
Vendor Consideration Received
Consideration received from vendors is accounted for in accordance with FASB Accounting Standards Codification 330, ‘‘Inventory’’ (‘‘ASC 330’’). Pursuant to ASC 330, manufacturer incentives based upon cumulative volume of sales and purchases are recorded as a reduction of inventory cost and related cost of sales when the amounts are probable and reasonably estimable.
Derivative and Hedging Instruments
The Company utilizes derivative financial instruments to manage its interest rate risk. The types of risks hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. The Company documents the management strategy and assess hedge effectiveness at inception and throughout the term of the hedging relationship. Derivatives are reported at fair value on the accompanying unaudited condensed consolidated balance sheets.
The changes in fair value on the hedges is reported as a component of accumulated other comprehensive income (loss) on the accompanying unaudited condensed consolidated balance sheets, and reclassified to either interest expense – floor plan or interest expense – other in the accompanying unaudited condensed consolidated statements of operations based on the nature of the hedged transaction in the period during which the hedged transaction affects earnings. Cash flows from hedging instruments, including cash receipts and payments, are classified on the unaudited condensed consolidated statements of cash flows in the same category as the cash flows resulting from the item being hedged.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed periodically, and the effects of any revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant estimates made in the accompanying unaudited condensed consolidated financial statements include, but are not limited to, those relating to inventory mark downs, certain assumptions related to intangible and long-lived assets and valuation of contingent consideration.
Segment Information
We report our operations through two reportable segments: Dealerships and Distribution. The Dealership segment engages in the sale of new and pre-owned boats, arranges financing and insurance products, performs repairs and maintenance services, offers marine related parts and accessories and offers slip and storage accommodations in certain locations. The Distribution segment engages in the manufacturing, assembly and distribution primarily of marine related products to distributors, big box retailers and online retailers through a network of warehouse and distribution centers. Each reporting segment has discrete financial information and is regularly reviewed by the Company’s chief operating decision maker (“CODM”) to assess performance and allocate resources. The Company has identified its Chief Executive Officer as its CODM.
v3.24.4
New Accounting Pronouncements
3 Months Ended
Dec. 31, 2024
Accounting Standards Update and Change in Accounting Principle [Abstract]  
New Accounting Pronouncements New Accounting Pronouncements
In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which is intended to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2023, and interim periods within annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2025 and in interim reports during fiscal year 2026.
In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which is intended to improve the transparency, effectiveness and comparability of income tax disclosures by requiring greater disaggregation of information and additional disclosures. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement in fiscal year 2026.
In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which is intended to improve financial reporting by requiring disclosure of additional information about specific expense categories in the notes to the financial statements. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2028 and in interim reports during the fiscal year 2029.
Other than as noted above, there are no new accounting pronouncements that are expected to have a material effect on our consolidated financial statements.
v3.24.4
Acquisitions
3 Months Ended
Dec. 31, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]  
Acquisitions Acquisitions
There were no acquisitions during the three months ended December 31, 2024.
During the three months ended December 31, 2023, the Company exercised its right to acquire the remaining 20% economic interest in Quality Assets and Operations, LLC for consideration totaling $18.8 million. Subsequent to the acquisition, the Company now owns 100% of the economic interest in Quality Assets and Operations, LLC.
v3.24.4
Accounts Receivable
3 Months Ended
Dec. 31, 2024
Receivables [Abstract]  
Accounts Receivable Accounts Receivable
Accounts receivable primarily consists of trade accounts receivable, contracts in transit and manufacturer receivables. Trade receivables include amounts due from customers on the sale of boats, parts, service, and storage. Contracts in transit represent anticipated funding from the loan agreement customers execute at the dealership when they purchase their new or pre-owned boat. These finance contracts are typically funded within 30 days. Amounts due from manufacturers represent receivables for various manufacturer incentive programs and parts and service work performed pursuant to the manufacturers’ warranties.
The allowance for credit losses is estimated based on past collection experience, current conditions and reasonable and supportable forecasts. The activity for charges and subsequent recoveries is immaterial.
Accounts receivable consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
Trade accounts receivable$20,627 $32,578 
Contracts in transit16,021 20,437 
Manufacturer receivable11,546 11,435 
Income tax receivable9,246 9,370 
Total accounts receivable57,440 73,820 
Less – allowance for credit losses(528)(551)
Total accounts receivable, net$56,912 $73,269 
v3.24.4
Inventories
3 Months Ended
Dec. 31, 2024
Inventory Disclosure [Abstract]  
Inventories Inventories
Inventories consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
New vessels$481,060 $442,834 
Pre-owned vessels86,142 79,234 
Work in process, parts and accessories69,474 68,770 
Total inventories$636,676 $590,838 
v3.24.4
Goodwill and Intangible Assets
3 Months Ended
Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Goodwill and Intangible Assets
Our acquisitions have resulted in the recording of goodwill and other identifiable intangible assets. Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Intangible assets consist of internally developed software, domain names and other identifiable intangible assets, such as trade names, developed technologies, and customer relationships related to the acquisitions the Company has completed. The changes in goodwill and intangible assets are as follows:
GoodwillTrade NamesDeveloped TechnologiesCustomer RelationshipsDomain NamesInternally Developed
Software
Total
Intangible
Assets, net
($ in thousands)UnamortizedUnamortizedAmortizedAmortizedAmortizedAmortized
Net balance as of September 30, 2024$336,602 $149,921 $3,964 $46,403 $1,750 $3,353 $205,391 
Acquisitions and additions during the three months ended December 31, 2024— — — — — 362 362 
Accumulated amortization for the three months ended December 31, 2024— — (135)(1,525)(159)(303)(2,122)
Net balance as of December 31, 2024$336,602 $149,921 $3,829 $44,878 $1,591 $3,412 $203,631 
Amortization expense was $2.1 million and $1.6 million for the three months ended December 31, 2024 and 2023, respectively, which includes amortization expense of $0.3 million and $0.2 million for the three months ended December 31, 2024 and 2023, respectively, for internally developed software, and is recorded in depreciation and amortization expense in the unaudited condensed consolidated statements of operations. For internally developed software acquisitions and additions during the three months ended December 31, 2024, the weighted average useful life is 4.3 years.
The following table summarizes the expected amortization expense for the fiscal years 2025 through 2029 and thereafter ($ in thousands):
2025 (excluding the three months ended December 31, 2024)$6,381 
20268,508 
20278,265 
20286,687 
20296,686 
Thereafter17,183 
$53,710 
As of December 31, 2024 and September 30, 2024, the carrying value of goodwill totaled approximately $336.6 million, of which $295.3 million was related to our Dealerships reporting segment and $41.3 million was related to our Distribution reporting segment.
v3.24.4
Notes Payable - Floor Plan
3 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Notes Payable - Floor Plan Notes Payable — Floor Plan
The Company maintains an ongoing wholesale marine products inventory financing program with a syndicate of banks. The program is administered by Wells Fargo Commercial Distribution Finance, LLC (“Wells Fargo”) as set forth in the Eighth Amended and Restated Inventory Financing Agreement entered into by the Company and certain of its subsidiaries with Wells Fargo and the other financial institutions party thereto on November 14, 2023 (as amended from time to time, the “Inventory Financing Facility”). On November 13, 2024, the Company and certain of its subsidiaries entered into the Consent, Waiver and Second Amendment to the Eighth Amended and Restated Inventory Financing Agreement with Wells Fargo and other lenders party thereto which, among other things, (i) modified certain definitions, terms and conditions, (ii) adjusted the minimum fixed charge coverage ratio, (iii) adjusted the maximum funded debt to EBITDA ratio, (iv) established a new minimum liquidity measure, (v) allowed for certain swap transactions to mitigate risk in the ordinary course of business, and (vi) reduced the maximum borrowing capacity from $650 million to $595 million. The Inventory Financing Facility expires on March 1, 2026. The outstanding balance of the facility was $490.1 million and $443.4 million, as of December 31, 2024 and September 30, 2024, respectively.
Interest on new boats and for rental units is calculated using the Adjusted 30-Day Average SOFR (as defined in the Inventory Financing Facility) (“SOFR”) plus an applicable margin of 2.75% to 5.00% depending on the age of the inventory. Interest on pre-owned boats is calculated at the new boat rate plus 0.25%. Wells Fargo will finance 100.0% of the vendor invoice price for new boats, engines, and trailers. As of December 31, 2024 the interest rate on the Inventory Financing Facility ranged from 7.39% to 9.64% for new inventory and 7.64% to 9.89% for pre-owned inventory. As of September 30, 2024 the interest rate on the Inventory Financing Facility ranged from 8.03% to 10.28% for new inventory and 8.28% to 10.53% for pre-owned inventory. Borrowing capacity available at December 31, 2024 and September 30, 2024 was $104.9 million and $206.6 million, respectively.
The Inventory Financing Facility has certain financial and non-financial covenants as specified in the agreement. The financial covenants include requirements to comply with a maximum funded debt to EBITDA ratio, a minimum fixed charge coverage ratio and a minimum liquidity measure (as defined in the Inventory Financing Facility). In addition, certain non-financial covenants could restrict the Company’s ability to sell assets (excluding inventory in the normal course of business), engage in certain mergers and acquisitions, incur additional debt and pay cash dividends or distributions, among others. The Company was in compliance with all covenants for the reporting period ended December 31, 2024.
The collateral for the Inventory Financing Facility consists primarily of our inventory that is financed through the Inventory Financing Facility and related assets, including accounts receivable, bank accounts and proceeds of the foregoing, and excludes the collateral that underlies the term note payable to Truist Bank.
v3.24.4
Long-term Debt and Line of Credit
3 Months Ended
Dec. 31, 2024
Long-Term Debt, Unclassified [Abstract]  
Long-term Debt and Line of Credit Long-term Debt and Line of Credit
On August 9, 2022, the Company and certain of its subsidiaries entered into the Amended and Restated Credit Agreement (the “A&R Credit Facility”) with Truist Bank. The A&R Credit Facility provides for a $65.0 million revolving credit facility (the “A&R Revolving Facility”) that may be used for revolving credit loans (including up to $5.0 million in swingline loans and up to $5.0 million in letters of credit) and a $445.0 million term loan (the “A&R Term Loan”). Subject to certain conditions, the available amount under the revolving credit facility and term loans may be increased by $125.0 million in the aggregate. The A&R Credit Facility bears interest at a rate that is equal to Term SOFR plus an applicable margin ranging from 1.75% to 2.75% based on certain consolidated leverage ratio measures. On November 13, 2024 the Company and certain of its subsidiaries entered into Amendment No. 6 to the Amended and Restated Credit Agreement and Waiver and Amendment No. 1 to Pledge and Security Agreement with Truist Bank to, among other things, (i) modify certain definitions, terms and conditions, (ii) adjust the minimum fixed charge coverage ratio, (iii) adjust the maximum leverage ratio measures, (iv) adjust the minimum liquidity measure, and (v) modify the maturity date to be July 31, 2026, and in connection therewith, the repayment schedule. The A&R Revolving Facility matures on July 31, 2026. The A&R Term Loan is repayable in installments beginning December 31, 2022, with the remainder due on July 31, 2026.
The A&R Credit Facility is collateralized by certain real and personal property (including certain capital stock) of the Company and its subsidiaries. The collateral does not include inventory and certain other assets of the Company’s subsidiaries financed under the Inventory Financing Facility. The A&R Credit Facility is subject to certain financial covenants related to the maintenance of a minimum fixed charge coverage ratio, a maximum consolidated leverage ratio and a minimum liquidity measure. The A&R Credit Facility also contains non-financial covenants and restrictive provisions that, among other things, limit the ability of the Company to incur additional debt, transfer or dispose of all of its assets, make certain investments, loans or payments and engage in certain transactions with affiliates. The Company was in compliance with all covenants for the reporting period ended December 31, 2024.
Long-term debt consisted of the following at:
($ in thousands except monthly payment amounts)December 31, 2024September 30, 2024
Term note payable to Truist Bank, secured and bearing interest at 7.58% at December 31, 2024 and 7.85% at September 30, 2024. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on July 31, 2026
$375,469 $375,469 
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 7.89% at December 31, 2024 and 7.75% at September 30, 2024. The note requires full repayment on July 31, 2026
58,040 51,150 
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029
2,254 2,561 
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note was paid in full on December 1, 2024
— 1,126 
Total debt outstanding435,763 430,306 
Less current portion (net of debt issuance costs)(15,672)(7,874)
Less unamortized portion of debt issuance costs(7,501)(7,498)
Long-term debt, net of current portion and unamortized debt issuance costs$412,590 $414,934 
As of December 31, 2024 and September 30, 2024, the Company had $1.6 million in letters of credit outstanding under the A&R Revolving Facility.
v3.24.4
Derivative and Hedging Instruments
3 Months Ended
Dec. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Instruments and Hedging Activities Disclosure Derivative and Hedging Instruments
The Company is subject to interest rate risk as a result of the Inventory Financing Facility and A&R Credit Facility required interest payments. The Company has two interest rate swap agreements which are designed to provide a hedge against changes in variable rate cash flows regarding fluctuations in the SOFR and Term SOFR rates which are used in calculating interest payments. The following table provides information on the attributes of each swap as of December 31, 2024:
Inception DateHedged RateNotional Value at Inception (in thousands)Maturity Date
September 2024SOFR$200,000 September 2027
September 2024Term SOFR$200,000 September 2027
The fair value of the cash flow swaps is calculated using an income approach. The income approach involves using the quoted price for economically equivalent inputs or valuation methodologies, assumptions and inputs, which in the case of projected future cash flows, discount such cash flows to a single net present value amount. The following table provides information regarding the fair value of the interest rate swap agreements and the impact on the unaudited condensed consolidated balance sheets at ($ in thousands):
Balance Sheet LocationDecember 31, 2024September 30, 2024
Prepaid expenses and other current assets$2,500 $1,560 
Other long-term assets2,723 — 
Other long-term liabilities— (3,626)
Net asset (liability)$5,223 $(2,066)
The interest rate swaps qualify for cash flow hedge accounting treatment. The interest rate swaps are marked to market each reporting date and any unrealized gains or losses, and the related income tax effects, are included in accumulated other comprehensive income (loss) and reclassified into earnings in the same period during which the hedged transactions affect earnings. Information about the effect of the interest swap agreements in the accompanying unaudited condensed consolidated statements of operations and unaudited condensed consolidated statements of comprehensive income (loss), is as follows ($ in thousands):
For the three months ended December 31,Results Recognized in Accumulated Other Comprehensive Income (Loss) (effective Portion)Location of Results Reclassified from Accumulated Other Comprehensive Income (Loss) to EarningsResults Reclassified from Accumulated Other Comprehensive Income (Loss) to Earnings
2024$8,573 Interest expense – other and Interest expense – floor plan$1,284 
2023$— Interest expense – other and Interest expense – floor plan$— 
The following table sets forth the location and amount of gain or (loss) recognized in earnings on cash flow hedging relationships for the three months ended December 31, 2024 and 2023 ($ in thousands):
December 31, 2024December 31, 2023
Interest expense – otherInterest expense – floor planInterest expense – otherInterest expense – floor plan
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings$568 $716 $— $— 
As of December 31, 2024, the amount expected to be reclassified out of accumulated other comprehensive income (loss) into earnings during the next 12 months is gains of $2.6 million. The ultimate amount recognized will vary based on fluctuations of interest rates through the maturity dates.
v3.24.4
Stockholders’ Equity
3 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Stockholders’ Equity Stockholders’ Equity
Equity-Based Compensation
We maintain the OneWater Marine Inc. Omnibus Incentive Plan (the “LTIP”) to incentivize individuals providing services to OneWater Inc and its subsidiaries and affiliates. The LTIP provides for the grant, from time to time, at the discretion of the board of directors of OneWater Marine Inc. (the “Board”) or a committee thereof, of (1) stock options, (2) stock appreciation rights, (3) restricted stock, (4) restricted stock units, (5) stock awards, (6) dividend equivalents, (7) other stock-based awards, (8) cash awards, (9) substitute awards and (10) performance awards. The total number of shares reserved for issuance under the LTIP that may be issued pursuant to incentive stock options (which generally are stock options that meet the requirements of Section 422 of the Code) is 1,627,695. The LTIP is and will continue to be administered by the Board, except to the extent the Board elects a committee of directors to administer the LTIP. Class A common stock subject to an award that expires or is cancelled, forfeited, exchanged, settled in cash or otherwise terminated without delivery of shares (including forfeiture of restricted stock awards) and shares withheld to pay the exercise price of, or to satisfy the withholding obligations with respect to, an award will again be available for delivery pursuant to other awards under the LTIP.
During the three months ended December 31, 2024, the Board approved the grant of 152,072 performance-based restricted stock units, which represents 100% of the target award. Performance-based restricted stock units provide an opportunity for the recipient to receive a number of shares of our common stock based on our performance goals. A performance-based restricted stock unit equals one share of common stock of the Company. The performance-based restricted stock units vest in three equal annual installments commencing on October 1, 2025. As of December 31, 2024, the Company estimated achievement of the performance targets at 100%.
During the three months ended December 31, 2024, the Board approved the grant of 211,978 time-based restricted stock units. Of this amount, 36,596 restricted stock units fully vest on October 1, 2025 and the remaining 175,382 restricted stock units vest in three equal annual installments commencing on October 1, 2025.
Compensation cost for time-based restricted stock units is based on the closing price of our common stock on the date immediately preceding the grant and is recognized on a graded basis over the applicable vesting periods. Compensation cost for performance share units is based on the closing price of our common stock on the date immediately preceding the grant and the ultimate performance level achieved and is recognized on a graded basis over the applicable vesting period. The Company recognized $2.0 million and $2.3 million of compensation expense for the three months ended December 31, 2024 and 2023, respectively, which includes $0.8 million and $0.9 million of compensation expense for the three months ended December 31, 2024 and 2023, respectively, for performance-based units.
The following table further summarizes activity related to restricted stock units for the three months ended December 31, 2024:
Restricted Stock Unit Awards
Number of Shares Weighted Average
Grant Date Fair Value
Unvested at September 30, 2024542,119$27.20 
Awarded364,05023.91 
Vested(238,352)27.54 
Forfeited— — 
Unvested at December 31, 2024667,817$25.29 
As of December 31, 2024, the total unrecognized compensation expense related to outstanding equity awards was $9.8 million, which the Company expects to recognize over a weighted-average period of 1.4 years.
We issue shares of our Class A common stock upon the vesting of performance-based restricted stock units and time-based restricted stock units. These shares are issued from our authorized and not outstanding common stock. In addition, in connection with the vesting of restricted stock units, we repurchase a portion of shares equal to the amount of employee income tax withholding. We recognize forfeitures of performance-based restricted stock units and time-based restricted stock units as the forfeitures occur.
Net Loss Per Share
Basic and diluted net loss per share of Class A common stock is computed by dividing net income (loss) attributable to OneWater Inc by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted net loss per share is computed by giving effect to all potentially dilutive shares.
The following table sets forth the calculation of net loss per share for the three months ended December 31, 2024 and 2023 (in thousands, except per share data):
Net earnings per share:Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Numerator:  
Net loss attributable to OneWater Inc$(11,971)$(7,170)
  
Denominator:  
Weighted-average number of unrestricted outstanding common shares used to calculate basic net loss per share14,83114,540
Effect of dilutive securities:  
Restricted stock units
Employee stock purchase plan
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted net earnings per share14,83114,540
  
Net loss per share of Class A common stock – basic$(0.81)$(0.49)
Net loss per share of Class A common stock – diluted$(0.81)$(0.49)
On March 30, 2022, the Board approved a share repurchase program up to $50 million. No shares of Class A common stock were repurchased by the Company during the three months ended December 31, 2024. As of December 31, 2024 the Company has repurchased and retired 73,487 shares of Class A common stock under the repurchase program for a purchase price of approximately $1.9 million. As of December 31, 2024, approximately $48.1 million remained available for future purchase under the repurchase program. The repurchase program does not have a predetermined expiration date.
Shares of Class B common stock and unvested restricted stock units do not share in the income (losses) of the Company and are therefore not participating securities. As such, separate presentation of basic and diluted net earnings per share of Class B common stock under the two-class method has not been presented.
The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted net earnings per share because the effect of including such potentially dilutive shares would have been antidilutive upon conversion (in thousands):
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Class B common stock1,4301,430
Restricted Stock Units105495
Employee Stock Purchase Plan926
1,5441,951
Employee Stock Purchase Plan
At the Company’s 2021 Annual Meeting of Stockholders (the “Annual Meeting”), held on February 23, 2021, the Company’s stockholders approved the OneWater Marine Inc. 2021 Employee Stock Purchase Plan (the “ESPP”), which was approved and adopted by the Board as of January 13, 2021 (the “Adoption Date”), subject to stockholder approval at the Annual Meeting. The effective date of the ESPP is February 23, 2021, and, unless earlier terminated, the ESPP will expire on the twentieth anniversary of the Adoption Date. The ESPP will be administered by the Board or by one or more committees to which the Board delegates such administration.
The ESPP enables eligible employees to purchase shares of the Company’s Class A common stock at a discount through participation in discrete offering periods. The ESPP is intended to qualify as an employee stock purchase plan under section 423 of the Internal Revenue Code of 1986, as amended. Up to a maximum of 603,622 shares of the Company’s Class A common stock may be issued under the ESPP as of December 31, 2024, subject to certain adjustments as set forth in the ESPP. On the first day of each fiscal year during the term of the ESPP, beginning on October 1, and ending on (and including) September 30, the number of shares of Class A common stock that may be issued under the ESPP will increase by a number of shares equal to the least of (i) 1% of the outstanding shares on the Adoption Date, or (ii) such lesser number of shares (including zero) that the administrator determines for purposes of the annual increase for that fiscal year. The number of shares of Class A common stock that may be granted to any single participant in any single option period will be subject to certain limitations set forth in the plan.
The Company recorded equity-based compensation for the ESPP of $0.1 million during the three months ended December 31, 2024 and 2023. As of December 31, 2024 and September 30, 2024, the Company had current liabilities of $0.5 million and $0.3 million, respectively, for future purchases of shares under the ESPP. No shares were issued under the ESPP during the three months ended December 31, 2024 and 2023.
We used a Black-Scholes model to estimate the fair value of the options granted to purchase shares issued pursuant to the ESPP. Volatility is based on the historical volatility of our common stock. The risk-free rate for periods within the contractual term of the options is based on the U.S. Treasury yield curve in effect at the time of grant.
The following are the assumptions used for the periods ended December 31, 2024 and 2023:
20242023
Dividend yield0.0 %0.0 %
Risk-free interest rate
5.4%
5.5 %
Volatility
55.0%
37.6 %
Expected lifeSix monthsSix months
Distributions
During the three months ended December 31, 2023, the Company made distributions to OneWater Unit Holders for certain permitted tax payments. The Company did not make distributions to OneWater Unit Holders during the three months ended December 31, 2024
v3.24.4
Fair Value Measurements
3 Months Ended
Dec. 31, 2024
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
In determining fair value, the Company uses various valuation approaches including market, income and/or cost approaches. FASB standard ‘‘Fair Value Measurements’’ (Topic 820) establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from independent sources. Unobservable inputs are those that reflect the Company’s expectation of the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:
Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Assets utilizing Level 1 inputs include marketable securities that are actively traded.
Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.
Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. Asset and liability measurements utilizing Level 3 inputs include those used in estimating fair value of non-financial assets and non-financial liabilities in purchase acquisitions, those used in assessing impairment of property and equipment and other intangibles, and those used in the reporting unit valuation in the annual goodwill impairment evaluation and contingent consideration.
The availability of observable inputs can vary and is affected by a wide variety of factors. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment required in determining fair value is greatest for assets and liabilities categorized in Level 3. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is disclosed is determined based on the lowest level input that is significant to the fair value measurement. Fair value measurements can be volatile based on various factors that may or may not be within the Company’s control.
The following tables summarize the Company’s financial assets and liabilities measured at fair value in the accompanying unaudited condensed consolidated balance sheets as of December 31, 2024 and September 30, 2024:
December 31, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets: 
Investment in Equity Securities$135 $— $— $135 
Derivative and hedging instruments— 5,223 — 5,223 
Liabilities: 
Contingent Consideration— — 14,947 14,947 
September 30, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets:    
Investment in Equity Securities$128 $— $— $128 
Derivative and hedging instruments— 1,560 — 1,560 
Liabilities:    
Contingent Consideration— — 15,161 15,161 
Derivative and hedging instruments— 3,626 — 3,626 
There were no transfers between the valuation hierarchy Levels 1, 2, and 3 for the three months ended December 31, 2024.
We measure all equity investments that do not result in consolidation and are not accounted for under the equity method at fair value with the change in fair value included in other expense (income), net, in the unaudited condensed consolidated statements of operations. The fair value of equity investments is measured using quoted prices in its active markets. The investment in equity securities balance is recorded in other long-term assets in the unaudited condensed consolidated balance sheets.
The portion of unrealized losses (gains) recognized related to equity securities still held as of December 31, 2024 and 2023 consists of the following:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Net (gain) loss recognized during the period on equity securities$(7)$112 
Less net loss recognized during the period on equity securities sold during the period— — 
Unrealized (gain) loss recognized during the reporting period on equity securities still held at the reporting date$(7)$112 
We estimate the fair value of contingent consideration using a probability-weighted discounted cash flow model based on forecasted future earnings or other agreed upon metrics including the production of acquisition leads. The acquisition contingent consideration liability has been accounted for based on inputs that are unobservable and significant to the overall fair value measurement (Level 3). The contingent consideration balance is recorded in other payables and accrued expenses and other long-term liabilities in the unaudited condensed consolidated balance sheets. Changes in fair value and net present value of contingent consideration are recorded in change in fair value of contingent consideration in the unaudited condensed consolidated statements of operations. The fair value of contingent consideration is reassessed on a quarterly basis.
The following table sets forth the changes in fair value of our contingent consideration for the three months ended December 31, 2024:
($ in thousands)Three Months Ended December 31, 2024
Balance as of September 30, 2024$15,161 
Additions from acquisitions— 
Settlement of contingent consideration(456)
Change in fair value, including accretion242 
Balance as of December 31, 2024$14,947 
We determine the carrying value of our cash and cash equivalents, accounts receivable, accounts payable, other payables and accrued expenses, floor plan notes payable, term note payable with Truist Bank, seller notes payable and company vehicle notes payable
approximate their fair values because of the nature of their terms and current market rates of these instruments. Derivative and hedging instruments are recorded at fair value as discussed in Note 10.
v3.24.4
Restructuring and Impairment
3 Months Ended
Dec. 31, 2024
Restructuring and Related Activities [Abstract]  
Restructuring and Impairment Restructuring and Impairment
During the three months ended December 31, 2024, the Company underwent various restructuring actions, primarily a reduction of headcount, closure of certain locations and inventory adjustments related to the cancellation of certain dealer agreements. As a result of the restructuring activities, the Company recognized $1.9 million of restructuring charges during the three months ended December 31, 2024, of which $0.9 million is recorded in restructuring and impairment and $1.0 million is recorded in new boat cost of sales in the unaudited consolidated statement of operations. Of the $1.9 million restructuring charges, $1.2 million and $0.7 million is reported in the Dealerships and Distribution reporting segments, respectively. No restructuring and impairment charges were recorded for the three months ended December 31, 2023.
v3.24.4
Income Taxes
3 Months Ended
Dec. 31, 2024
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
The Company is a corporation and, as a result, is subject to U.S. federal, state and local income taxes. OneWater LLC is treated as a pass-through entity for U.S. federal tax purposes and in most state and local jurisdictions. As such, OneWater LLC’s members, including the Company, are liable for federal and state income taxes on their respective shares of OneWater LLC’s taxable income.
Our effective tax rates of 27.9% and 22.2% for the three months ending December 31, 2024 and 2023, respectively, differ from statutory rates primarily due to losses allocated to non-controlling interests and limitations on officer's compensation.
The Company had federal net operating loss carryforwards from underlying corporate entities of approximately $4.3 million resulting in a deferred tax asset of $0.9 million as of September 30, 2024. The U.S. federal net operating loss carryforwards have no expiration but can only be used to offset up to 80% of future taxable income annually. The Company has Alabama net operating loss carryforwards of $0.3 million which has no limitation in use and expire in the years 2037 to 2040. The Company projects to fully utilize the net operating losses in subsequent fiscal years.
The Company has an IRC Section 163(j) interest expense carryforward of approximately $3.7 million, resulting in a deferred tax asset of $0.9 million as of September 30, 2024. The IRC Section 163(j) interest expense carryforward has no expiration.
The Company recognizes deferred tax assets to the extent it believes these assets are more-likely-than-not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing temporary differences, projected future taxable income, tax planning strategies and recent results of operations. Based on our cumulative earnings history and forecasted future sources of taxable income, we believe that we will fully realize our deferred tax assets in the future. The Company has not recorded a valuation allowance.
As of December 31, 2024 and September 30, 2024, the Company has not recognized any uncertain tax positions, penalties, or interest as management has concluded that no such positions exist. The Company is subject to examination in the US Federal and certain state tax jurisdictions for the tax years beginning with the year ended December 31, 2020. In November 2024, the Company received notification that the Florida Department of Revenue intended to commence a corporate income tax audit of OneWater Inc for the tax years ended September 30, 2021, 2022 and 2023. The audit is ongoing and the outcome and timing of settlements of asserted income tax liabilities, if any, are uncertain.
Tax Receivable Agreement
In connection with the IPO, the Company entered into a tax receivable agreement (the “Tax Receivable Agreement”) with certain of the owners of OneWater LLC. As of December 31, 2024 and September 30, 2024, our undiscounted liability under the Tax Receivable Agreement was $40.6 million, representing 85% of the calculated net cash savings in U.S. federal, state and local income tax and franchise tax that OneWater Inc anticipates realizing in future years from the result of certain increases in tax basis and certain tax benefits attributable to imputed interest as a result of OneWater Inc’s acquisition of OneWater LLC Units pursuant to an exercise of the Redemption Right or the Call Right (each as defined in the amended and restated limited liability company agreement of OneWater LLC (the “OneWater LLC Agreement”)).
The projection of future taxable income involves significant judgment. Actual taxable income may differ from our estimates, which could significantly impact our ability to make payments under the Tax Receivable Agreement. We have determined it is more-likely-than-not that we will be able to utilize all of our deferred tax assets subject to the Tax Receivable Agreement; therefore, we have recorded a liability under the Tax Receivable Agreement related to the tax savings we may realize from certain increases in tax basis and certain tax benefits attributable to imputed interest as a result of OneWater Inc’s acquisition of OneWater LLC Units pursuant to an exercise of the Redemption Right or Call Right (each as defined in the OneWater LLC Agreement). If we determine the utilization of these deferred tax assets is not more-likely-than-not in the future, our estimate of amounts to be paid under the Tax Receivable Agreement would be reduced. In this scenario, the reduction of the liability under the Tax Receivable Agreement would result in a benefit to our consolidated statements of operations.
v3.24.4
Contingencies and Commitments
3 Months Ended
Dec. 31, 2024
Commitments and Contingencies Disclosure [Abstract]  
Contingencies and Commitments Contingencies and Commitments
Employment Agreements
The Company is party to employment agreements with certain executives, which provide for compensation, other benefits and severance payments under certain circumstances. The Company also has consulting and noncompete agreements in place with previous owners of acquired companies.
Claims and Litigation
The Company is involved in various legal proceedings as either the defendant or plaintiff. Due to their nature, such legal proceedings involve inherent uncertainties including, but not limited to, court rulings, negotiations between the affected parties and other actions. Management assesses the probability of losses or gains for such contingencies and accrues a liability and/or discloses the relevant circumstances as appropriate. In the opinion of management, it is not reasonably probable that the pending litigation, disputes or claims against the Company, as of December 31, 2024, will have a material adverse effect on its financial condition, results of operations or cash flows. However, the outcome of any matter cannot be predicted with certainty, and an unfavorable resolution of one or more matters presently known or arising in the future could have a material adverse effect on the Company’s financial condition, liquidity or results of operations.
Risk Management
The Company is exposed to various risks of loss related to torts; theft of, damage to, and destruction of assets; errors and omissions and natural disasters for which the Company carries commercial insurance. There have been no significant reductions in coverage from the prior year and settlements have not exceeded coverage in the past years.
v3.24.4
Leases
3 Months Ended
Dec. 31, 2024
Leases [Abstract]  
Leases Leases
The Company leases real estate and equipment under operating lease agreements. Leases with an initial term of 12 months or less are not recorded on the balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. For leases with terms in excess of 12 months, we record a right-of-use (“ROU”) asset and lease liability based on the present value of lease payments over the lease term. We do not have any significant leases that have not yet commenced that create significant rights and obligations for us. The Company has elected the practical expedient not to separate lease and non-lease components for all leases that qualify.
Our real estate and equipment leases often require payment of maintenance, real estate taxes and insurance. These costs are generally variable and based on actual costs incurred by the lessor. These amounts are not included in the consideration of the contract when determining the ROU asset and lease liability but are reflected as variable lease payments.
Most leases include one or more options to renew, with renewal terms that can extend the lease from one to ten or more years. The exercise of the lease renewal option is typically at our sole discretion. If it is reasonably certain that we will exercise the option to renew, the period covered by the options are included in the lease term and are recognized as part of our ROU assets and lease liabilities. Certain leases include the option to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term, which includes renewal options reasonably certain to be exercised.
Certain of our lease agreements include rental payments based on percentage of retail sales over contractual levels and others include rental payments adjusted periodically based on index rates. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.
v3.24.4
Related Party Transactions
3 Months Ended
Dec. 31, 2024
Related Party Transactions [Abstract]  
Related Party Transactions Related Party Transactions
In accordance with agreements approved by the Board, we purchased inventory, in conjunction with our retail sale of the products, from certain entities affiliated with the Company. Total purchases incurred under these arrangements were $52.4 million and $49.8 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, certain entities affiliated with the Company receive fees for rent of commercial property. Total expenses incurred under these arrangements were $1.4 million and $0.7 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, the Company received fees from certain entities and individuals affiliated with the Company for goods and services. Total fees recorded under these arrangements were $2.1 million and less than $1.1 million for the three months ended December 31, 2024 and 2023, respectively.
In accordance with agreements approved by the Board, the Company made payments to certain entities and individuals affiliated with the Company for goods and services. Total payments recorded under these arrangements were $0.2 million for the three months ended December 31, 2024. No payments were recorded under these arrangements for the three months ended December 31, 2023.
In connection with transactions noted above, the Company owed $4.9 million and $6.0 million as recorded within accounts payable as of December 31, 2024 and September 30, 2024, respectively. No amounts were recorded within accounts receivable as of December 31, 2024 and September 30, 2024.
In connection with the Tax Receivable Agreement, the Company owed $36.2 million as recorded within current portion of tax receivable agreement liability and tax receivable agreement liability on the unaudited condensed consolidated balance sheets at December 31, 2024 and September 30, 2024. See further discussion of our Tax Receivable Agreement in Note 14.
v3.24.4
Segment Information
3 Months Ended
Dec. 31, 2024
Segment Reporting [Abstract]  
Segment Information Segment Information
We report our operations through two reportable segments: (1) Dealerships and (2) Distribution. See Note 2 for more information about our segments.
Reportable segment financial information for the three months ended December 31, 2024 and 2023 are as follows:
As of and for the Three Months Ended December 31, 2024
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$347,670 $28,189 $(45)$375,814 
Income (loss) from operations3,020 (4,981)(12)(1,973)
  
Depreciation and amortization3,489 2,548 — 6,037 
Transaction costs512 47 — 559 
Change in fair value of contingent consideration242 — — 242 
Restructuring and impairment1,156 742 — 1,898 
  
Total assets1,391,436 220,120 (10)1,611,546 
As of and for the Three Months Ended December 31, 2023
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$331,607 $32,466 $(60)$364,013 
Income (loss) from operations6,943 (465)(7)6,471 
Depreciation and amortization2,902 2,003 — 4,905 
Transaction costs440 139 — 579 
Change in fair value of contingent consideration572 — — 572 
Restructuring and impairment— — — — 
Total assets1,445,553 247,553 (33)1,693,073 
v3.24.4
Pay vs Performance Disclosure - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Pay vs Performance Disclosure    
Net loss attributable to OneWater Inc $ (11,971) $ (7,170)
v3.24.4
Insider Trading Arrangements
3 Months Ended
Dec. 31, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.4
Description of Company and Basis of Presentation (Policies)
3 Months Ended
Dec. 31, 2024
Description of Company and Basis of Presentation [Abstract]  
Principles of Consolidation
Principles of Consolidation
As the sole managing member of OneWater LLC, OneWater Inc operates and controls all of the businesses and affairs of OneWater LLC. Through OneWater LLC and its wholly-owned subsidiaries, as well as majority-owned subsidiaries over which the Company exercises control, OneWater Inc conducts its business. As a result, OneWater Inc consolidates the financial results of OneWater LLC and its subsidiaries and reports non-controlling interests related to the portion of units of OneWater LLC (the “OneWater LLC Units”) not owned by OneWater Inc, which will reduce net income (loss) attributable to OneWater Inc’s Class A stockholders. As of December 31, 2024, OneWater Inc owned 91.2% of the economic interest of OneWater LLC.
Commencing December 31, 2021, the Company owned 80% of the economic interest of Quality Assets and Operations, LLC, over which the Company exercised control and the minority interest in this subsidiary was recorded accordingly. On October 31, 2023, the Company acquired the remaining 20% of the economic interest and, as a result, as of December 31, 2024 owned 100% of Quality Assets and Operations, LLC. See Note 4 for additional information regarding the acquisition.
Basis of Financial Statement Preparation
Basis of Financial Statement Preparation
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements, which do not include all the information and notes required by such accounting principles for annual financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with OneWater Inc’s Annual Report on Form 10-K for the year ended September 30, 2024. All adjustments, consisting of only normal recurring adjustments considered by management to be necessary for fair presentation, have been reflected in these unaudited condensed consolidated financial statements.
All intercompany transactions have been eliminated in consolidation. The Company operates on a fiscal year basis with the first day of the fiscal year being October 1, and the last day of the fiscal year ending on September 30.
Cash
Cash
At times the amount of cash on deposit may exceed the federally insured limit of the bank. Deposit accounts at each of the institutions are insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC). At December 31, 2024 and September 30, 2024, the Company exceeded FDIC limits at various institutions. The Company has not experienced any losses in such accounts and believes there is little to no exposure to any significant credit risk. Total cash and restricted cash shown in the unaudited condensed consolidated statements of cash flows is comprised of the amounts reported in cash and restricted cash on the unaudited condensed consolidated balance sheets.
Restricted Cash
Restricted Cash
Restricted cash relates to amounts collected for brokerage sales, in certain states, which are held in escrow on behalf of the respective buyers and sellers for future purchases of boats.
Inventories
Inventories
Inventories are stated at the lower of cost or net realizable value. The costs of inventories consist of amounts paid to acquire the inventory, net of vendor consideration received and purchase discounts, and, varying by inventory type, may include the cost of reconditioning, equipment addition, transportation, material, labor and manufacturing overhead. The cost of the new and pre-owned boat inventory is determined using the specific identification method. In assessing lower of cost or net realizable value, the Company considers the aging of the boats, historical sales of a brand and current market conditions. The cost of acquired, manufactured and assembled parts and accessories is determined using methods which vary by subsidiary and include the average cost method, standard costs (which approximate average costs) and first-in, first-out (“FIFO”).
Goodwill and Other Identifiable Intangible Assets
Goodwill and Other Identifiable Intangible Assets
Goodwill is an asset representing operational synergies and future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized. Other identifiable intangible assets primarily consist of trade names, developed technologies, and customer relationships related to the acquisitions the Company has completed. The Company has determined that trade names have an indefinite life, as there are no economic, contractual or other factors that limit their useful lives and they are expected to generate value as long as the trade name is utilized by the Company, and therefore, are not subject to amortization. Developed technologies and customer relationships are amortized over their estimated useful lives of ten years. Goodwill and indefinite-lived intangible assets are accounted for in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 350, ‘‘Intangibles – Goodwill and Other’’ (‘‘ASC 350’’), which provides that the excess of cost over the fair value of the net assets of businesses acquired, including other identifiable intangible assets, is recorded as goodwill.
In accordance with ASC 350, Goodwill and indefinite-lived intangible assets are tested for impairment at least annually, or more frequently when events or circumstances indicate that impairment might have occurred. ASC 350 also states for annual impairment tests that if an entity determines, based on an assessment of certain qualitative factors, that it is more likely than not that the fair value of a reporting unit or indefinite-lived intangible asset is greater than its carrying amount, then a quantitative impairment test is unnecessary. The Company performs its annual test in the fiscal fourth quarter.
In accordance with FASB ASC 360-10, "Property, Plant and Equipment – Impairment or Disposal of Long-Lived Assets" (“ASC 360”), the Company assesses the potential for impairment of its definite-lived intangible assets if facts and circumstances, such as declines in sales, earnings, cash flows or adverse changes in the business climate, suggest that they may be impaired. Definite-lived intangible assets include developed technologies and customer relationships which are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable.
Sales Tax
Sales Tax
The Company collects sales tax on all of the Company’s sales to nonexempt customers and remits the entire amount to the states that imposed the sales tax. The Company’s accounting policy is to exclude the tax collected and remitted to the states from revenues and cost of sales.
Revenue Recognition
Revenue Recognition
Revenue is recognized from the sale of products and commissions earned on new and pre-owned boats (including used, brokerage, consignment and wholesale) when ownership is transferred to the customer, which is generally upon acceptance by or delivery to the customer. At the time of acceptance or delivery, the customer is able to direct the use of, and obtain substantially all of the benefits. We are the principal with respect to revenue from new, pre-owned and consignment sales and such revenue is recorded at the gross sales price. With respect to brokerage transactions, we are acting as an agent in the transaction, therefore the fee or commission is recorded on a net basis.
Revenue from parts and accessories sold directly to a customer (not on a repair order) is recognized when control of the item is transferred to the customer, which is typically upon shipment. Revenue from parts and service operations (boat maintenance and repairs) is recorded over time as services are performed. Satisfaction of this performance obligation creates an asset with no alternative use for which an enforceable right to payment for performance to date exists within our contractual agreements. Each boat maintenance and repair service is a single performance obligation that includes both the parts and labor associated with the service. Payment for boat maintenance and repairs is typically due upon the completion of the service, which is generally completed within a period of one year or less from contract inception. The Company recorded contract assets in prepaid expenses and other current assets of $4.3 million and $4.2 million as of December 31, 2024 and September 30, 2024, respectively.
Certain parts and service transactions require the Company to perform shipping and handling activities after the transfer of control to the customer (e.g., when control transfers prior to delivery). They are considered fulfillment activities and are included in selling, general and administrative expenses.
Revenue from storage and marina operations is recognized on a straight-line basis over the term of the contract as services are completed. Revenue from arranging financing, insurance and extended warranty contracts to customers through various third-party financial institutions and insurance companies is recognized when the related boats are sold. We do not directly finance our customers’ boat, motor or trailer purchases. We are acting as an agent in the transaction, therefore the commissions are recorded on a net basis. Subject to our agreements and in the event of early cancellation, prepayment or default of such loans or insurance contracts by the customer, we may be assessed a chargeback for a portion of the commission paid by the third-party financial institutions and insurance companies. We reserve for these chargebacks based on our historical experience with repayments or defaults. Chargebacks were not material to the unaudited condensed consolidated financial statements for the three months ended December 31, 2024 and 2023.
Income Taxes
Income Taxes
OneWater Inc is a corporation and as a result, is subject to U.S. federal, state and local income taxes. We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events included in the consolidated financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the book value and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period in which the enactment date occurs. We recognize deferred tax assets to the extent we believe these assets are more-likely-than-not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations.
OneWater LLC is treated as a partnership for U.S. federal income tax purposes and therefore does not pay U.S. federal income tax on its taxable income. Instead, the OneWater LLC members are liable for U.S. federal income tax on their respective shares of the Company’s taxable income reported on the members’ U.S. federal income tax returns.
When there are situations with uncertainty as to the timing of the deduction, the amount of the deduction, or the validity of the deduction, the Company adjusts the financial statements to reflect only those tax positions that are more-likely-than-not to be sustained. Positions that meet this criterion are measured using the largest benefit that is more than 50% likely to be realized. Interest and penalties related to income taxes are included in the benefit (provision) for income taxes in the consolidated statements of operations.
Vendor Consideration Received
Vendor Consideration Received
Consideration received from vendors is accounted for in accordance with FASB Accounting Standards Codification 330, ‘‘Inventory’’ (‘‘ASC 330’’). Pursuant to ASC 330, manufacturer incentives based upon cumulative volume of sales and purchases are recorded as a reduction of inventory cost and related cost of sales when the amounts are probable and reasonably estimable.
Derivative and hedging instruments
Derivative and Hedging Instruments
The Company utilizes derivative financial instruments to manage its interest rate risk. The types of risks hedged are those relating to the variability of cash flows caused by fluctuations in interest rates. The Company documents the management strategy and assess hedge effectiveness at inception and throughout the term of the hedging relationship. Derivatives are reported at fair value on the accompanying unaudited condensed consolidated balance sheets.
The changes in fair value on the hedges is reported as a component of accumulated other comprehensive income (loss) on the accompanying unaudited condensed consolidated balance sheets, and reclassified to either interest expense – floor plan or interest expense – other in the accompanying unaudited condensed consolidated statements of operations based on the nature of the hedged transaction in the period during which the hedged transaction affects earnings. Cash flows from hedging instruments, including cash receipts and payments, are classified on the unaudited condensed consolidated statements of cash flows in the same category as the cash flows resulting from the item being hedged.
Use of Estimates
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenses during the periods presented. Actual results could differ materially from these estimates. Estimates and assumptions are reviewed periodically, and the effects of any revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Significant estimates made in the accompanying unaudited condensed consolidated financial statements include, but are not limited to, those relating to inventory mark downs, certain assumptions related to intangible and long-lived assets and valuation of contingent consideration.
Segment Information
Segment Information
We report our operations through two reportable segments: Dealerships and Distribution. The Dealership segment engages in the sale of new and pre-owned boats, arranges financing and insurance products, performs repairs and maintenance services, offers marine related parts and accessories and offers slip and storage accommodations in certain locations. The Distribution segment engages in the manufacturing, assembly and distribution primarily of marine related products to distributors, big box retailers and online retailers through a network of warehouse and distribution centers. Each reporting segment has discrete financial information and is regularly reviewed by the Company’s chief operating decision maker (“CODM”) to assess performance and allocate resources. The Company has identified its Chief Executive Officer as its CODM.
New Accounting Pronouncements New Accounting Pronouncements
In November 2023, the FASB issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures", which is intended to improve financial reporting by requiring disclosures of incremental segment information on an annual and interim basis. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2023, and interim periods within annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2025 and in interim reports during fiscal year 2026.
In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures", which is intended to improve the transparency, effectiveness and comparability of income tax disclosures by requiring greater disaggregation of information and additional disclosures. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2024. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement in fiscal year 2026.
In November 2024, the FASB issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses", which is intended to improve financial reporting by requiring disclosure of additional information about specific expense categories in the notes to the financial statements. The pronouncement is effective for a public company's annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact that this standard will have on the consolidated financial statements. The Company plans to adopt the pronouncement beginning in the annual report for fiscal year 2028 and in interim reports during the fiscal year 2029.
Other than as noted above, there are no new accounting pronouncements that are expected to have a material effect on our consolidated financial statements.
v3.24.4
Summary of Significant Accounting Policies (Tables)
3 Months Ended
Dec. 31, 2024
Accounting Policies [Abstract]  
Summary of Contract Liabilities The activity in customer deposits for the three months ended December 31, 2024 and 2023 is as follows:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Beginning contract liability$63,955 $51,649 
Revenue recognized from contract liabilities included in the beginning balance(38,408)(31,378)
Increases due to cash received, net of amounts recognized in revenue during the period27,907 30,706 
Ending contract liability$53,454 $50,977 
Summary of Percentages on Timing of Revenue Recognition
The following table sets forth percentages on the timing of revenue recognition for the three months ended December 31, 2024 and 2023.
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Goods and services transferred at a point in time92.6 %92.7 %
Goods and services transferred over time7.4 %7.3 %
Total Revenue100.0 %100.0 %
v3.24.4
Accounts Receivable (Tables)
3 Months Ended
Dec. 31, 2024
Receivables [Abstract]  
Summary of Accounts Receivable
Accounts receivable consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
Trade accounts receivable$20,627 $32,578 
Contracts in transit16,021 20,437 
Manufacturer receivable11,546 11,435 
Income tax receivable9,246 9,370 
Total accounts receivable57,440 73,820 
Less – allowance for credit losses(528)(551)
Total accounts receivable, net$56,912 $73,269 
v3.24.4
Inventories (Tables)
3 Months Ended
Dec. 31, 2024
Inventory Disclosure [Abstract]  
Summary of Inventories
Inventories consisted of the following:
($ in thousands)December 31, 2024September 30, 2024
New vessels$481,060 $442,834 
Pre-owned vessels86,142 79,234 
Work in process, parts and accessories69,474 68,770 
Total inventories$636,676 $590,838 
v3.24.4
Goodwill and Intangible Assets (Tables)
3 Months Ended
Dec. 31, 2024
Goodwill and Intangible Assets Disclosure [Abstract]  
Summary of Changes in Goodwill and Identifiable Intangible Assets The changes in goodwill and intangible assets are as follows:
GoodwillTrade NamesDeveloped TechnologiesCustomer RelationshipsDomain NamesInternally Developed
Software
Total
Intangible
Assets, net
($ in thousands)UnamortizedUnamortizedAmortizedAmortizedAmortizedAmortized
Net balance as of September 30, 2024$336,602 $149,921 $3,964 $46,403 $1,750 $3,353 $205,391 
Acquisitions and additions during the three months ended December 31, 2024— — — — — 362 362 
Accumulated amortization for the three months ended December 31, 2024— — (135)(1,525)(159)(303)(2,122)
Net balance as of December 31, 2024$336,602 $149,921 $3,829 $44,878 $1,591 $3,412 $203,631 
Summary of Expected Amortization Expense
The following table summarizes the expected amortization expense for the fiscal years 2025 through 2029 and thereafter ($ in thousands):
2025 (excluding the three months ended December 31, 2024)$6,381 
20268,508 
20278,265 
20286,687 
20296,686 
Thereafter17,183 
$53,710 
v3.24.4
Long-term Debt and Line of Credit (Tables)
3 Months Ended
Dec. 31, 2024
Long-Term Debt, Unclassified [Abstract]  
Summary of Long-term Debt and Line of Credit
Long-term debt consisted of the following at:
($ in thousands except monthly payment amounts)December 31, 2024September 30, 2024
Term note payable to Truist Bank, secured and bearing interest at 7.58% at December 31, 2024 and 7.85% at September 30, 2024. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on July 31, 2026
$375,469 $375,469 
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 7.89% at December 31, 2024 and 7.75% at September 30, 2024. The note requires full repayment on July 31, 2026
58,040 51,150 
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029
2,254 2,561 
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note was paid in full on December 1, 2024
— 1,126 
Total debt outstanding435,763 430,306 
Less current portion (net of debt issuance costs)(15,672)(7,874)
Less unamortized portion of debt issuance costs(7,501)(7,498)
Long-term debt, net of current portion and unamortized debt issuance costs$412,590 $414,934 
v3.24.4
Derivative and Hedging Instruments (Tables)
3 Months Ended
Dec. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Notional Amounts of Outstanding Derivative Positions The following table provides information on the attributes of each swap as of December 31, 2024:
Inception DateHedged RateNotional Value at Inception (in thousands)Maturity Date
September 2024SOFR$200,000 September 2027
September 2024Term SOFR$200,000 September 2027
Schedule of Interest Rate Derivatives The following table provides information regarding the fair value of the interest rate swap agreements and the impact on the unaudited condensed consolidated balance sheets at ($ in thousands):
Balance Sheet LocationDecember 31, 2024September 30, 2024
Prepaid expenses and other current assets$2,500 $1,560 
Other long-term assets2,723 — 
Other long-term liabilities— (3,626)
Net asset (liability)$5,223 $(2,066)
Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) Information about the effect of the interest swap agreements in the accompanying unaudited condensed consolidated statements of operations and unaudited condensed consolidated statements of comprehensive income (loss), is as follows ($ in thousands):
For the three months ended December 31,Results Recognized in Accumulated Other Comprehensive Income (Loss) (effective Portion)Location of Results Reclassified from Accumulated Other Comprehensive Income (Loss) to EarningsResults Reclassified from Accumulated Other Comprehensive Income (Loss) to Earnings
2024$8,573 Interest expense – other and Interest expense – floor plan$1,284 
2023$— Interest expense – other and Interest expense – floor plan$— 
Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location
The following table sets forth the location and amount of gain or (loss) recognized in earnings on cash flow hedging relationships for the three months ended December 31, 2024 and 2023 ($ in thousands):
December 31, 2024December 31, 2023
Interest expense – otherInterest expense – floor planInterest expense – otherInterest expense – floor plan
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings$568 $716 $— $— 
v3.24.4
Stockholders’ Equity (Tables)
3 Months Ended
Dec. 31, 2024
Equity [Abstract]  
Summary of Restricted Stock Units Activity
The following table further summarizes activity related to restricted stock units for the three months ended December 31, 2024:
Restricted Stock Unit Awards
Number of Shares Weighted Average
Grant Date Fair Value
Unvested at September 30, 2024542,119$27.20 
Awarded364,05023.91 
Vested(238,352)27.54 
Forfeited— — 
Unvested at December 31, 2024667,817$25.29 
Summary of Calculation of Net (Loss) Earnings Per Share
The following table sets forth the calculation of net loss per share for the three months ended December 31, 2024 and 2023 (in thousands, except per share data):
Net earnings per share:Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Numerator:  
Net loss attributable to OneWater Inc$(11,971)$(7,170)
  
Denominator:  
Weighted-average number of unrestricted outstanding common shares used to calculate basic net loss per share14,83114,540
Effect of dilutive securities:  
Restricted stock units
Employee stock purchase plan
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted net earnings per share14,83114,540
  
Net loss per share of Class A common stock – basic$(0.81)$(0.49)
Net loss per share of Class A common stock – diluted$(0.81)$(0.49)
Summary of Antidilutive Securities Excluded From Calculation
The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted net earnings per share because the effect of including such potentially dilutive shares would have been antidilutive upon conversion (in thousands):
Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Class B common stock1,4301,430
Restricted Stock Units105495
Employee Stock Purchase Plan926
1,5441,951
Summary of Weighted Average Assumptions
The following are the assumptions used for the periods ended December 31, 2024 and 2023:
20242023
Dividend yield0.0 %0.0 %
Risk-free interest rate
5.4%
5.5 %
Volatility
55.0%
37.6 %
Expected lifeSix monthsSix months
v3.24.4
Fair Value Measurements (Tables)
3 Months Ended
Dec. 31, 2024
Fair Value Disclosures [Abstract]  
Summary of Financial Assets and Liabilities Measured at Fair Value
The following tables summarize the Company’s financial assets and liabilities measured at fair value in the accompanying unaudited condensed consolidated balance sheets as of December 31, 2024 and September 30, 2024:
December 31, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets: 
Investment in Equity Securities$135 $— $— $135 
Derivative and hedging instruments— 5,223 — 5,223 
Liabilities: 
Contingent Consideration— — 14,947 14,947 
September 30, 2024
($ in thousands)Level 1Level 2Level 3Total
Assets:    
Investment in Equity Securities$128 $— $— $128 
Derivative and hedging instruments— 1,560 — 1,560 
Liabilities:    
Contingent Consideration— — 15,161 15,161 
Derivative and hedging instruments— 3,626 — 3,626 
Summary of Unrealized Gains (Losses) Recognized Related to Equity Securities
The portion of unrealized losses (gains) recognized related to equity securities still held as of December 31, 2024 and 2023 consists of the following:
($ in thousands)Three Months Ended December 31, 2024Three Months Ended December 31, 2023
Net (gain) loss recognized during the period on equity securities$(7)$112 
Less net loss recognized during the period on equity securities sold during the period— — 
Unrealized (gain) loss recognized during the reporting period on equity securities still held at the reporting date$(7)$112 
Summary of Changes in Fair Value of Contingent Consideration
The following table sets forth the changes in fair value of our contingent consideration for the three months ended December 31, 2024:
($ in thousands)Three Months Ended December 31, 2024
Balance as of September 30, 2024$15,161 
Additions from acquisitions— 
Settlement of contingent consideration(456)
Change in fair value, including accretion242 
Balance as of December 31, 2024$14,947 
v3.24.4
Segment Information (Tables)
3 Months Ended
Dec. 31, 2024
Segment Reporting [Abstract]  
Summary of Reportable Segment Financial Information
Reportable segment financial information for the three months ended December 31, 2024 and 2023 are as follows:
As of and for the Three Months Ended December 31, 2024
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$347,670 $28,189 $(45)$375,814 
Income (loss) from operations3,020 (4,981)(12)(1,973)
  
Depreciation and amortization3,489 2,548 — 6,037 
Transaction costs512 47 — 559 
Change in fair value of contingent consideration242 — — 242 
Restructuring and impairment1,156 742 — 1,898 
  
Total assets1,391,436 220,120 (10)1,611,546 
As of and for the Three Months Ended December 31, 2023
($ in thousands)DealershipsDistributionEliminationsTotal
Revenue$331,607 $32,466 $(60)$364,013 
Income (loss) from operations6,943 (465)(7)6,471 
Depreciation and amortization2,902 2,003 — 4,905 
Transaction costs440 139 — 579 
Change in fair value of contingent consideration572 — — 572 
Restructuring and impairment— — — — 
Total assets1,445,553 247,553 (33)1,693,073 
v3.24.4
Description of Company and Basis of Presentation (Details)
3 Months Ended
Dec. 31, 2024
center
brand
location
state
Dec. 31, 2023
Oct. 31, 2023
Dec. 31, 2022
Description of Company and Basis of Presentation [Line Items]        
Number of retail locations | location 96      
Number of distribution centers | center 10      
Number of states in which entity operates | state 19      
Number of top brands | brand 10      
Economic interest of quality assets and operations 100.00%     80.00%
Acquired economic interest of quality assets and operations     20.00%  
OneWater LLC        
Description of Company and Basis of Presentation [Line Items]        
Ownership interest in subsidiaries 91.20%      
Revenue Benchmark | Product Concentration Risk | Top Ten Brands        
Description of Company and Basis of Presentation [Line Items]        
Concentration risk, percentage 45.70% 48.90%    
Revenue Benchmark | Supplier Concentration Risk | Malibu Boats, Inc        
Description of Company and Basis of Presentation [Line Items]        
Concentration risk, percentage 13.10% 13.60%    
v3.24.4
Summary of Significant Accounting Policies - Narrative (Details)
$ in Millions
3 Months Ended
Dec. 31, 2024
USD ($)
segment
Sep. 30, 2024
USD ($)
Accounting Policies [Abstract]    
Property, plant and equipment, useful life 10 years  
Allowance for credit loss, current | $ $ 4.3 $ 4.2
Number of operating segments | segment 2  
v3.24.4
Summary of Significant Accounting Policies - Summary of Contract Liabilities (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Contract With Customer, Liability [Roll Forward]    
Beginning contract liability $ 63,955 $ 51,649
Revenue recognized from contract liabilities included in the beginning balance (38,408) (31,378)
Increases due to cash received, net of amounts recognized in revenue during the period 27,907 30,706
Ending contract liability $ 53,454 $ 50,977
v3.24.4
Summary of Significant Accounting Policies - Summary of Percentages on Timing of Revenue Recognition (Details) - Revenue from Contract with Customer Benchmark - Product Concentration Risk
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Disaggregation of Revenue [Line Items]    
Concentration risk, percentage 100.00% 100.00%
Goods and services transferred at a point in time    
Disaggregation of Revenue [Line Items]    
Concentration risk, percentage 92.60% 92.70%
Goods and services transferred over time    
Disaggregation of Revenue [Line Items]    
Concentration risk, percentage 7.40% 7.30%
v3.24.4
Acquisitions - Narrative (Details) - Quality Assets and Operations, LLC
$ in Millions
Dec. 31, 2023
USD ($)
Business Acquisition [Line Items]  
Company owns economic interest 20.00%
Economic interest percentage 100.00%
Consideration $ 18.8
v3.24.4
Accounts Receivable (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Sep. 30, 2024
Receivables [Abstract]    
Finance contracts maximum funding period 30 days  
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total accounts receivable $ 57,440 $ 73,820
Less – allowance for credit losses (528) (551)
Total accounts receivable, net 56,912 73,269
Trade accounts receivable    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total accounts receivable 20,627 32,578
Contracts in transit    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total accounts receivable 16,021 20,437
Manufacturer receivable    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total accounts receivable 11,546 11,435
Income tax receivable    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Total accounts receivable $ 9,246 $ 9,370
v3.24.4
Inventories (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Sep. 30, 2024
Inventory [Line Items]    
Total inventories $ 636,676 $ 590,838
New vessels    
Inventory [Line Items]    
Total inventories 481,060 442,834
Pre-owned vessels    
Inventory [Line Items]    
Total inventories 86,142 79,234
Work in process, parts and accessories    
Inventory [Line Items]    
Total inventories $ 69,474 $ 68,770
v3.24.4
Goodwill and Intangible Assets - Summary of Changes in Goodwill and Identifiable Intangible Assets (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Goodwill [Roll Forward]    
Net balance - beginning of period $ 336,602  
Acquisition 0  
Net balance - end of period 336,602  
Finite-Lived Intangible Assets [Roll Forward]    
Accumulated amortization (2,122) $ (1,600)
Net balance - end of period 53,710  
Intangible Assets Disclosure [Roll Forward]    
Net balance - beginning of period 205,391  
Acquisition 362  
Accumulated amortization (2,122) (1,600)
Net balance - end of period 203,631  
Trade Names    
Indefinite-Lived Intangible Assets [Roll Forward]    
Net balance - beginning of period 149,921  
Acquisitions 0  
Net balance - end of period 149,921  
Developed Technologies    
Finite-Lived Intangible Assets [Roll Forward]    
Net balance - beginning of period 3,964  
Acquisitions 0  
Accumulated amortization (135)  
Net balance - end of period 3,829  
Intangible Assets Disclosure [Roll Forward]    
Accumulated amortization (135)  
Customer Relationships    
Finite-Lived Intangible Assets [Roll Forward]    
Net balance - beginning of period 46,403  
Acquisitions 0  
Accumulated amortization (1,525)  
Net balance - end of period 44,878  
Intangible Assets Disclosure [Roll Forward]    
Accumulated amortization (1,525)  
Domain Names    
Finite-Lived Intangible Assets [Roll Forward]    
Net balance - beginning of period 1,750  
Acquisitions 0  
Accumulated amortization (159)  
Net balance - end of period 1,591  
Intangible Assets Disclosure [Roll Forward]    
Accumulated amortization (159)  
Internally Developed Software    
Finite-Lived Intangible Assets [Roll Forward]    
Net balance - beginning of period 3,353  
Acquisitions 362  
Accumulated amortization (303) (200)
Net balance - end of period 3,412  
Intangible Assets Disclosure [Roll Forward]    
Accumulated amortization $ (303) $ (200)
v3.24.4
Goodwill and Intangible Assets - Narrative (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Sep. 30, 2024
Indefinite-Lived Intangible Assets [Line Items]      
Amortization of intangible assets $ 2,122 $ 1,600  
Weighted average useful life 4 years 3 months 18 days    
Goodwill $ 336,602   $ 336,602
Dealerships      
Indefinite-Lived Intangible Assets [Line Items]      
Goodwill 295,300   295,300
Distribution      
Indefinite-Lived Intangible Assets [Line Items]      
Goodwill $ 41,300   $ 41,300
v3.24.4
Goodwill and Intangible Assets - Summary of Expected Amortization Expense (Details)
$ in Thousands
Dec. 31, 2024
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
2025 (excluding the three months ended December 31, 2024) $ 6,381
2026 8,508
2027 8,265
2028 6,687
2029 6,686
Thereafter 17,183
Total $ 53,710
v3.24.4
Notes Payable - Floor Plan (Details) - Inventory Financing Facility - USD ($)
$ in Millions
3 Months Ended
Dec. 31, 2024
Nov. 13, 2024
Sep. 30, 2024
Nov. 14, 2023
Line of Credit Facility [Abstract]        
Maximum borrowing capacity   $ 595.0   $ 650.0
Outstanding balance of facility $ 490.1   $ 443.4  
Line of credit facility, remaining borrowing capacity $ 104.9   $ 206.6  
Minimum | New Inventory        
Line of Credit Facility [Abstract]        
Credit facility, interest rate 7.39%   8.03%  
Minimum | Pre-owned Inventory        
Line of Credit Facility [Abstract]        
Credit facility, interest rate 7.64%   8.28%  
Maximum | New Inventory        
Line of Credit Facility [Abstract]        
Credit facility, interest rate 9.64%   10.28%  
Maximum | Pre-owned Inventory        
Line of Credit Facility [Abstract]        
Credit facility, interest rate 9.89%   10.53%  
Wells Fargo        
Line of Credit Facility [Abstract]        
Percentage of finance provided of vendor invoice price 100.00%      
SOFR        
Line of Credit Facility [Abstract]        
Debt instrument, term of variable rate 30 days      
SOFR | Minimum | New Boats        
Line of Credit Facility [Abstract]        
Debt instrument, variable interest rate 2.75%      
SOFR | Maximum | New Boats        
Line of Credit Facility [Abstract]        
Debt instrument, variable interest rate 5.00%      
Boat Rate | New Boats        
Line of Credit Facility [Abstract]        
Debt instrument, variable interest rate 0.25%      
v3.24.4
Long-term Debt and Line of Credit - Narrative (Details) - USD ($)
Aug. 09, 2022
Dec. 31, 2024
Sep. 30, 2024
A&R Term Loan      
Debt Instrument [Line Items]      
Maximum borrowing capacity $ 445,000,000.0    
Amended And Restated Revolving Credit Facility      
Debt Instrument [Line Items]      
Letters of Credit Outstanding, Amount   $ 1,600,000 $ 1,600,000
A&R Credit Facility      
Debt Instrument [Line Items]      
Maximum borrowing capacity 65,000,000.0    
Increase in revolving commitment $ 125,000,000.0    
A&R Credit Facility | Minimum      
Debt Instrument [Line Items]      
Debt instrument, variable interest rate 1.75%    
A&R Credit Facility | Maximum      
Debt Instrument [Line Items]      
Debt instrument, variable interest rate 2.75%    
A&R Credit Facility | Swingline Loans      
Debt Instrument [Line Items]      
Maximum borrowing capacity $ 5,000,000.0    
A&R Credit Facility | Letter of Credit      
Debt Instrument [Line Items]      
Maximum borrowing capacity $ 5,000,000.0    
v3.24.4
Long-term Debt and Line of Credit - Summary of Long-term Debt and Line of Credit (Details) - USD ($)
3 Months Ended
Dec. 31, 2024
Sep. 30, 2024
Debt Instrument [Line Items]    
Total debt outstanding $ 435,763,000 $ 430,306,000
Less current portion (net of debt issuance costs) (15,672,000) (7,874,000)
Less unamortized portion of debt issuance costs (7,501,000) (7,498,000)
Long-term debt, net of current portion and unamortized debt issuance costs 412,590,000 414,934,000
Term note payable to Truist Bank, secured and bearing interest at 7.58% at December 31, 2024 and 7.85% at September 30, 2024. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on July 31, 2026    
Debt Instrument [Line Items]    
Total debt outstanding $ 375,469,000 $ 375,469,000
Debt instrument, interest rate, stated percentage 7.58% 7.85%
Revolving note payable for an amount up to $65.0 million to Truist Bank, secured and bearing interest at 7.89% at December 31, 2024 and 7.75% at September 30, 2024. The note requires full repayment on July 31, 2026    
Debt Instrument [Line Items]    
Total debt outstanding $ 58,040,000 $ 51,150,000
Debt instrument, interest rate, stated percentage 7.89% 7.75%
Line of credit facility, maximum borrowing capacity $ 65,000,000.0  
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029    
Debt Instrument [Line Items]    
Total debt outstanding $ 2,254,000 $ 2,561,000
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029 | Minimum    
Debt Instrument [Line Items]    
Debt instrument, interest rate, stated percentage 0.00%  
Debt instrument, periodic payment $ 200,000  
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 10.8% per annum. The notes require monthly installment payments of principal and interest ranging from $200 to $3,100 through April 2029 | Maximum    
Debt Instrument [Line Items]    
Debt instrument, interest rate, stated percentage 10.80%  
Debt instrument, periodic payment $ 3,100,000  
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note was paid in full on December 1, 2024    
Debt Instrument [Line Items]    
Total debt outstanding $ 0 $ 1,126,000
Debt instrument, interest rate, stated percentage 4.00%  
v3.24.4
Derivative and Hedging Instruments - Narrative (Details)
$ in Millions
3 Months Ended
Dec. 31, 2024
USD ($)
derivative_instrument
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Number of derivative instruments | derivative_instrument 2
Amount expected to be reclassified out of accumulated other comprehensive (loss) income into earnings during the next 12 months | $ $ 2.6
v3.24.4
Derivative and Hedging Instruments - Notional Value (Details) - Interest Rate Swap - Term SOFR
$ in Thousands
Sep. 07, 2024
USD ($)
Derivative Instruments and Hedging Activities Disclosures [Line Items]  
Notional Value at Inception (in thousands) $ 200,000
Notional Value at Inception (in thousands) $ 200,000
v3.24.4
Derivative and Hedging Instruments - Balance Sheet Location (Details) - USD ($)
$ in Thousands
Dec. 31, 2024
Sep. 30, 2024
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Net asset (liability) $ 5,223 $ (2,066)
Prepaid expenses and other current assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Derivative assets 2,500 1,560
Other long-term assets    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Derivative assets 2,723 0
Other long-term liabilities    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Derivative liabilities $ 0 $ (3,626)
v3.24.4
Derivative and Hedging Instruments - Effect of the Interest Rate Swap Agreements (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Results Recognized in Accumulated Other Comprehensive Income (Loss) (effective Portion) $ 8,573 $ 0
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings 1,284 0
Floorplan Interest Expense    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings 716 0
Interest Expense    
Derivative Instruments and Hedging Activities Disclosures [Line Items]    
Amount of gain or (loss) reclassified from accumulated other comprehensive income (loss) to earnings $ 568 $ 0
v3.24.4
Stockholders’ Equity - Narrative (Details)
$ in Thousands
3 Months Ended 12 Months Ended 33 Months Ended
Oct. 02, 2024
intallment
shares
Oct. 01, 2024
shares
Oct. 02, 2023
intallment
Feb. 23, 2021
shares
Dec. 31, 2024
USD ($)
shares
Dec. 31, 2023
USD ($)
shares
Sep. 30, 2024
USD ($)
Dec. 31, 2024
USD ($)
shares
Mar. 30, 2022
USD ($)
Share-Based Payment Arrangement [Abstract]                  
Percentage of expected performance targets to be achieved target award         100.00%     100.00%  
Authorized amount | $                 $ 50,000
Stock repurchase program, remaining authorized repurchase amount | $         $ 48,100     $ 48,100  
Equity-based awards | $         2,170 $ 2,392      
Employee Stock                  
Share-Based Payment Arrangement [Abstract]                  
Equity-based awards | $         100 100      
Stock to be purchased under ESPP | $         $ 500   $ 300    
Performance Shares                  
Share-Based Payment Arrangement [Abstract]                  
Awarded (in shares) | shares         152,072        
Percentage of target award granted         100.00%        
Number of shares of common stock consisted in each unit (in shares) | shares         1        
Number of equal annual installments for vesting | intallment     3            
Share-based payment arrangement, expense | $         $ 800 900      
Time-Based Restricted Stock Units                  
Share-Based Payment Arrangement [Abstract]                  
Awarded (in shares) | shares 175,382 36,596     211,978        
Number of equal annual installments for vesting | intallment 3                
Restricted Stock Units                  
Share-Based Payment Arrangement [Abstract]                  
Awarded (in shares) | shares         364,050,000        
Share-based payment arrangement, expense | $         $ 2,000 $ 2,300      
Nonvested award | $         $ 9,800     $ 9,800  
Cost not yet recognized, period for recognition         1 year 4 months 24 days        
Employee Stock                  
Share-Based Payment Arrangement [Abstract]                  
Shares issued as part of employee stock purchase plan (in shares) | shares         0 0      
Class A Common Stock                  
Share-Based Payment Arrangement [Abstract]                  
Capital shares reserved for future issuance (in shares) | shares         1,627,695     1,627,695  
Repurchased shares (in shares) | shares         0        
Repurchased and retired shares (in shares) | shares               73,487  
Repurchase and retirement of shares amount | $               $ 1,900  
Percentage of outstanding shares, ESPP issuance       1.00%          
Class A Common Stock | Maximum                  
Share-Based Payment Arrangement [Abstract]                  
Shares issued as part of employee stock purchase plan (in shares) | shares       603,622          
v3.24.4
Stockholders’ Equity - Summary of Restricted Stock Units Activity (Details) - Restricted Stock Units
3 Months Ended
Dec. 31, 2024
$ / shares
shares
Number of Shares  
Beginning balance (in shares) | shares 542,119,000
Awarded (in shares) | shares 364,050,000
Vested (in shares) | shares (238,352,000)
Forfeited (in shares) | shares 0
Ending balance (in shares) | shares 667,817,000
Weighted Average Grant Date Fair Value  
Beginning balance (in usd per share) | $ / shares $ 27.20
Awarded (in usd per shares) | $ / shares 23.91
Vested (in usd per shares) | $ / shares 27.54
Forfeited (in usd per shares) | $ / shares 0
Ending balance (in usd per share) | $ / shares $ 25.29
v3.24.4
Stockholders’ Equity - Summary of Net (Loss) Earnings Per Share (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Numerator:    
Net loss attributable to OneWater Inc $ (11,971) $ (7,170)
Class A Common Stock    
Denominator:    
Weighted-average number of unrestricted outstanding common shares used to calculate basic net (loss) income per share (in shares) 14,831 14,540
Weighted Average Number of Shares Outstanding, Diluted, Adjustment [Abstract]    
Diluted weighted-average shares of Class A common stock outstanding used to calculate diluted net (loss) earnings per share (in shares) 14,831 14,540
Net (loss) earnings per share of Class A common stock – basic (in usd per share) $ (0.81) $ (0.49)
Net (loss) earnings per share of Class A common stock – diluted (in usd per share) $ (0.81) $ (0.49)
Class A Common Stock | Employee Stock    
Weighted Average Number of Shares Outstanding, Diluted, Adjustment [Abstract]    
Restricted stock unit and employee stock purchase plan (in shares) 0 0
Class A Common Stock | Restricted Stock Units    
Weighted Average Number of Shares Outstanding, Diluted, Adjustment [Abstract]    
Restricted stock unit and employee stock purchase plan (in shares) 0 0
v3.24.4
Stockholders’ Equity - Summary of Antidilutive Securities (Details) - shares
shares in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted average shares (in shares) 1,544 1,951
Restricted Stock Units    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted average shares (in shares) 105 495
Employee Stock    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted average shares (in shares) 9 26
Class B Common Stock    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of diluted weighted average shares (in shares) 1,430 1,430
v3.24.4
Stockholders’ Equity - Summary of Employee Stock Purchase Plan (Details)
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Equity [Abstract]    
Dividend yield 0.00% 0.00%
Risk-free interest rate 5.40% 5.50%
Volatility 55.00% 37.60%
Expected life 6 months 6 months
v3.24.4
Fair Value Measures - Summary of Financial Assets and Liabilities Measured at Fair Value (Details) - Reported Value Measurement - USD ($)
$ in Thousands
Dec. 31, 2024
Sep. 30, 2024
Assets:    
Investment in Equity Securities $ 135 $ 128
Liabilities:    
Contingent Consideration 14,947 15,161
Derivative and hedging instruments   3,626
Derivative assets 5,223 1,560
Level 1    
Assets:    
Investment in Equity Securities 135 128
Liabilities:    
Contingent Consideration 0 0
Derivative and hedging instruments   0
Derivative assets 0 0
Level 2    
Assets:    
Investment in Equity Securities 0 0
Liabilities:    
Contingent Consideration 0 0
Derivative and hedging instruments   3,626
Derivative assets 5,223 1,560
Level 3    
Assets:    
Investment in Equity Securities 0 0
Liabilities:    
Contingent Consideration 14,947 15,161
Derivative and hedging instruments   0
Derivative assets $ 0 $ 0
v3.24.4
Fair Value Measures - Summary of Unrealized Losses Recognized Related to Equity Securities (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Fair Value Disclosures [Abstract]    
Net (gain) loss recognized during the period on equity securities $ (7) $ 112
Less net loss recognized during the period on equity securities sold during the period 0 0
Unrealized (gain) loss recognized during the reporting period on equity securities still held at the reporting date $ (7) $ 112
v3.24.4
Fair Value Measures - Summary of Changes in Fair Value of Contingent Consideration (Details) - Liability
$ in Thousands
3 Months Ended
Dec. 31, 2024
USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]  
Beginning balance $ 15,161
Additions from acquisitions 0
Settlement of contingent consideration (456)
Change in fair value, including accretion 242
Ending balance $ 14,947
v3.24.4
Restructuring and Impairment (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Restructuring Cost and Reserve [Line Items]    
Restructuring and impairment $ 1,898 $ 0
Restructuring and Impairment    
Restructuring Cost and Reserve [Line Items]    
Restructuring and impairment 900  
New Boat Cost of Sales    
Restructuring Cost and Reserve [Line Items]    
Restructuring and impairment 1,000  
Dealerships    
Restructuring Cost and Reserve [Line Items]    
Restructuring and impairment 1,200  
Distribution    
Restructuring Cost and Reserve [Line Items]    
Restructuring and impairment $ 700  
v3.24.4
Income Taxes (Details) - USD ($)
$ in Millions
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Sep. 30, 2024
Operating Loss Carryforwards [Line Items]      
Effective income tax rate reconciliation (in percent) 27.90% 22.20%  
Tax receivable agreement liability $ 40.6   $ 40.6
Percentage of net cash savings 85.00%    
Deferred Tax Assets, Operating Loss Carryforwards, Domestic     0.9
Tax Credit Carryforward, Amount     3.7
Deferred Tax Asset, Interest Carryforward     0.9
Domestic Tax Jurisdiction      
Operating Loss Carryforwards [Line Items]      
Operating loss carryforwards     4.3
State and Local Jurisdiction      
Operating Loss Carryforwards [Line Items]      
Operating loss carryforwards     $ 0.3
v3.24.4
Leases (Details)
Dec. 31, 2024
Minimum  
Operating Leased Assets [Line Items]  
Lessor, operating lease, renewal term 1 year
Maximum  
Operating Leased Assets [Line Items]  
Lessor, operating lease, renewal term 10 years
v3.24.4
Related Party Transactions (Details) - USD ($)
$ in Thousands
3 Months Ended
Dec. 31, 2024
Dec. 31, 2023
Sep. 30, 2024
Related Party Transaction [Line Items]      
Total revenues $ 375,814 $ 364,013  
Accounts receivable, net 56,912   $ 73,269
Accounts payable 29,266   32,106
Tax receivable agreement liability 40,600   40,600
Affiliated Entities and Individuals      
Related Party Transaction [Line Items]      
Total revenues 2,100 1,100  
Costs and expenses, related party 200 0  
Affiliated Entity      
Related Party Transaction [Line Items]      
Purchase of inventories 52,400 49,800  
Expenses incurred 1,400 $ 700  
Accounts receivable, net 0   0
Accounts payable 4,900   6,000
Tax receivable agreement liability $ 36,200   $ 36,200
v3.24.4
Segment Information (Details)
$ in Thousands
3 Months Ended
Dec. 31, 2024
USD ($)
segment
Dec. 31, 2023
USD ($)
Sep. 30, 2024
USD ($)
Segment Information [Abstract]      
Number of reportable segments | segment 2    
Revenue $ 375,814 $ 364,013  
Income (loss) from operations (1,973) 6,471  
Depreciation and amortization 6,037 4,905  
Transaction costs 559 579  
Change in fair value of contingent consideration 242 572  
Restructuring and impairment 1,898 0  
Total assets 1,611,546 1,693,073 $ 1,589,989
Eliminations      
Segment Information [Abstract]      
Revenue (45) (60)  
Income (loss) from operations (12) (7)  
Depreciation and amortization 0 0  
Transaction costs 0 0  
Change in fair value of contingent consideration 0 0  
Restructuring and impairment 0 0  
Total assets (10) (33)  
Dealerships      
Segment Information [Abstract]      
Restructuring and impairment 1,200    
Dealerships | Operating Segments      
Segment Information [Abstract]      
Revenue 347,670 331,607  
Income (loss) from operations 3,020 6,943  
Depreciation and amortization 3,489 2,902  
Transaction costs 512 440  
Change in fair value of contingent consideration 242 572  
Restructuring and impairment 1,156 0  
Total assets 1,391,436 1,445,553  
Distribution      
Segment Information [Abstract]      
Restructuring and impairment 700    
Distribution | Operating Segments      
Segment Information [Abstract]      
Revenue 28,189 32,466  
Income (loss) from operations (4,981) (465)  
Depreciation and amortization 2,548 2,003  
Transaction costs 47 139  
Change in fair value of contingent consideration 0 0  
Restructuring and impairment 742 0  
Total assets $ 220,120 $ 247,553  

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