The Limestone Boat Company Announces Third Quarter 2021 Results

·11 min read

Limestone continues to execute on its sustainable, long-term growth plan to meet the unprecedented market demand for boats

COLLINGWOOD, ON, Nov. 29, 2021 /CNW/ - The Limestone Boat Company Limited ("Limestone" or the "Company") (TSXV: BOAT) – owner and builder of Aquasport Boats, Limestone® Boats and Boca Bay Boats – today reports its financial results for the three and nine months ended September 30, 2021 ("Q3" FY 2021). All dollar amounts are in Canadian dollars unless otherwise noted.

The Company's complete Financial Statements and Management Discussion and Analysis for the three and nine months ended September 30, 2021 are available at www.sedar.com or on the Company's website at www.limestoneboatcompany.com .

"Limestone remains well positioned in a marketplace that is still demanding as many boats as we can supply, despite ongoing global supply chain constraints," stated Limestone CEO, Scott Hanson. "Our recently announced private placement will provide us with the necessary capital required to further execute on our sustainable, long-term growth plan and allow us to deliver that product to a growing number of customers and dealers."

"Management's vertical integration strategy and subsequent acquisition of Ebbtide Holdings has certainly proven prescient. Control over our own production and manufacturing has enabled us to remain resilient and agile, providing a critical competitive advantage in the face of a tightening supply chain. Furthermore, strategic investments in our facilities, labor force, and R&D have provided a solid operational foundation, translating to an increased number of weekly units started. Work in progress continues to escalate, and we are recognizing improved efficiencies through the identification and removal of process bottlenecks, monetizing WIP backlogs in assembly, and managing any aforementioned supply chain disruptions."

Mr. Hanson concluded, "We are proud of how we have executed on our strategic initiatives and are confident that we will start to see the benefits in unit production, revenues and EBITDA in Q1 2022 given the steps taken since the acquisition with respect to human capital, leadership, finance, procurement, process and quality assurance."

Q3 2021 Fiscal Year Financial Highlights:

  • Reported a net loss of $8,731,165 for the nine months ended September 30, 2021, which included approximately $2.3 million of non-cash expenses, compared to a loss of $738,061 for the nine months ended September 30, 2020.

  • Reported a net loss of $3,196,226 for the three months ended September 30, 2021, which included approximately $356,000 of non-cash expenses, compared to a loss of $479,261 for the three months ended September 30, 2020.

  • The Company ended the quarter with cash of $740,545 compared to $130,181 for the year ended December 31, 2020.

  • Subsequent to the end of the third quarter, on November 23rd, 2021, The Company completed the first tranche of a Brokered Private Placement of units for $2.6 million in proceeds.

  • There are several risk factors facing the Company including but not limited to the impact of Covid-19 on the operations and ongoing supply chain disruption as more fully described in the Company's Management Discussion and Analysis for Q3 FY2021 (the "MD&A") available on the Company's profile on www.sedar.com or on the Company's website at www.limestoneboats.com.

Summary of Financial Information and Overall Performance:

Review of Statements of Comprehensive Income:

Review of Statements of Comprehensive Income (CNW Group/The Limestone Boat Company)
Review of Statements of Comprehensive Income (CNW Group/The Limestone Boat Company)

The Company's complete Financial Statements and Management Discussion and Analysis for the quarter ended September 30, 2021 are available at www.sedar.com or on the Company's website at www.limestoneboatcompany.com .

Peter Pigott, CFO of Limestone commented, "Limestone's third quarter results reflect a continued emphasis on building confidence with supply chain partners and establishing a foundation for scaled growth in both our production capabilities and a focus on building inventory. These investments will yield efficiencies in margins as we scale production in 2022 and beyond."

Q3 2021- Business Highlights:

  • Debut of New Brand Flagship Models
    The Company continues to develop and revamp the entire Limestone® and Aquasport lineup, having introduced and launched two all-new models to the market since July 2021. In September, the company unveiled the all-new dual console L-290DC model under the Limestone® banner. In August, the company debuted its new center console Aquasport 3000CC, the flagship model for Aquasport, with orders and shipments commencing in Q4 of 2022. In July, Limestone delivered its first production model, the L-200CC center console, and has been making bi-weekly shipments. Production and shipments of the revitalized L-290CD, L-250R and L-200R have been scheduled to commence throughout Q1 2022, with the L-270CD following in late Q1 2022.

  • Increase in Order Book Backlog
    Demand for Limestone and Aquasport models exceeds the Company's projected capacity for both the 2022 and 2023 Model Year based on its current order book backlog. Orders in hand and expressed through the 2022 Model Year stand at 478 units, with a 2022 Model Year Proforma Capacity of approximately 279 units. Expressed Orders for the 2023 Model Year are at 676 units to date, with 2023 Model Year Proforma Capacity of approximately 650 units. The Model Year commences in June of the preceding year and concludes in May of that year.

  • Improved Manufacturing and Production Output
    Limestone's White Bluff, Tennessee-based boatbuilding headquarters, TN Composites, which produces both the Aquasport Boats and Limestone® Boats product lines for the parent company, is currently producing four boats per week. The Company is projecting to complete approximately 75 total units through the end of this 2021 calendar year since its acquisition of the Ebbtide facility. As the Company looks towards 2022 and its first full calendar year of production (post May 2021 acquisition), the management team is planning to increase production output incrementally each month, at the rate of an additional one half boat per week, commencing in January 2022 as a result of facility and process improvements, additional leadership, and current supply chain cadence. Management expects to increase weekly production by December 2022 to approximately 12 boats per week, with the objective of increasing full calendar year 2022 production to approximately 425 units.

  • Efficient Management of Supply Chain Constraints
    In the third quarter, management focussed its efforts on plant expansion and integration, along with controlling its ability to pivot weekly production as needed to align with any potential supply chain adjustments required. By maximizing production cycle times and its supply chain, the Company is ensuring that it will achieve the necessary depth in brand lineup for its network of dealers. The Company continues to optimize its product offering in the face of ongoing supply chain challenges to ensure predictability of production, quality throughput, and achieving revenue targets and margin goals.

  • Continued Expansion of Distribution and Dealer Partnerships
    In conjunction with the boat order backlog in the third quarter, Limestone is also saw a growing number of dealers who have expressed considerable interest in representing the Limestone® Boats and Aquasport Boats lines when production becomes readily available for the 2022 and 2023 Model Years. These new dealers will open up additional markets, further supporting the growth plan for the Company. The Company currently distributes product through 31 dealers, representing 44 locations throughout the Northeastern United States, the US Gulf Coast, and the North American Great Lakes Region.

  • Electric Boat Partnership with Vision Marine
    Limestone continues to progress with its first-mover partner for the future of boating innovation, Vision Marine Technologies. In the third quarter, Vision Marine commenced outfitting the Company's first two Test Boats with Vision's electric outboard E-motion 180. Sea Trials are anticipated to begin in early January in Tennessee. Pending successful results from the Sea Trials, Limestone intends to debut EV outboard power options during the Company's winter boat show tour as consumer demand for zero emission, high-performance boats continues to gain momentum.

  • Additions to Corporate and Manufacturing Leadership Teams
    Besides the Company's investment in its manufacturing facility, Limestone has successfully built a talented workforce, a crucial component of the Company's ability to execute its sustainable, long-lasting strategic growth plan. Limestone has made important additions to its Corporate and Manufacturing Leadership Teams, hiring Director of Marketing Keith McDevitt, who brings a strong history of managing luxury brands and dealer networks in the consumer durables space, and talented, field-experienced individuals to fill critical new positions at its White Bluff boatbuilding headquarters, including a controller, procurement manager, human resources (HR) manager, and production manager.

Subsequent Events to Q3 2021:

  • The Limestone Boat Company Completes First Tranche of Brokered Private Placement of Units (November 25, 2021)
    The Company announced that it had completed the first tranche of its previously announced brokered private placement (the "Placement") of 10,851,334 units (the "Units") of the Company at a price of $0.24 per Unit (the "Issue Price") for gross proceeds of approximately $2.6 million. The Placement was led by Beacon Securities Limited, acting as agent (the "Agent").
    (Read Full News Release)

  • The Limestone Boat Company Adds Four National Dealers to Its Respective Brand Rosters (November 18, 2021)
    The Company continued to build out its dealer network across the United States, announcing it had added four National Dealers to its respective brand roster, with new dealers added in Jacksonville, FL, Tavernier, FL, East Haven, CT, and Sagamore Beach, MA. Limestone Boat Company's distribution network now totals 31 dealers, representing 44 locations throughout the US and Canada.
    (Read Full News Release)

  • Limestone Announces Brokered Private Placement of up to $4 Million of Units (November 11, 2021)
    The Company announced a brokered private placement, led by Beacon Securities Limited of up to 16.67 million units (the "Units") at a price of $0.24 per Unit, to raise gross proceeds of up to $4.0 million. Each Unit will consist of one common share of the Company and one half of one Common Share purchase warrant, entitling the holder to purchase one additional Common Share at a price of $0.32 per Common Share for a period of 24 months following the closing of the Offering.
    (Read Full News Release)

  • The Limestone Boat Company Provides Corporate and Operational Update (October 21, 2021)
    The Company provided a detailed update on its recent corporate activities and operational initiatives, adding further insight on a number of critical manufacturing, production, distribution and brand milestones, all essential in ensuring a strong corporate, operational, and financial foundation for Limestone and its future.
    (Read Full News Release)

ABOUT LIMESTONE BOAT COMPANY LIMITED

The Limestone Boat Company – owner and builder of Aquasport Boats, Limestone® Boats and Boca Bay Boats - is publicly traded on the Toronto Venture Exchange under the ticker symbol BOAT. They are headquartered in Collingwood, Ontario with a 145,000 sq. ft. manufacturing facility in White Bluff, Tennessee. The company is backed by a large, skilled labor force and dealer partners throughout the United States and the Canadian Great Lakes Region.

Neither the TSX Venture Exchange nor its Regulation Services Provider accepts responsibility for the adequacy or accuracy of this news release.

Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words "anticipate", "believe", "could" "should", "would", "estimate", "expect", "forecast", "indicate", "intend", "likely, "may", "plan", "potential", "project", "outlook", "seek", "target", "trend" or "will" and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the parties' current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. The Company is subject to a number of risks relating to integration and go-forward operations, certain of which are more particularly described in the Company's public filings available on SEDAR including, without limitation, the filing statement filed by the Company on February 23, 2021, and the MD&A. The forward-looking information contained in this release is made as of the date hereof and the parties are not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward looking information. The foregoing statements expressly qualify any forward-looking information contained herein.

Many factors could cause actual results, level of activity, performance or achievements or future events or developments to differ materially from those expressed or implied by the forward-looking statements. All the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors in this press release. There can be no assurance that the actual results or developments will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company. Unless required by applicable securities law, the Company does not intend and does not assume any obligation to update these forward-looking statements.

The Limestone Boat Company Logo (CNW Group/The Limestone Boat Company)
The Limestone Boat Company Logo (CNW Group/The Limestone Boat Company)

SOURCE The Limestone Boat Company

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