Massimo Group reports revenue jump for Q423

Massimo Group has reported its financial and operational results for the fourth quarter and fiscal year that ended December 31, 2023. Q4 highlights include closing a $5.85 million IPO listing on the Nasdaq market under the ticker symbol “MAMO.” The company also reports a revenue increase of 58.5% to $39.6 million from $25.0 million in Q4 2022.

“The fourth quarter of 2023 and early 2024 were highlighted by strong sales for our diversified and comprehensive product portfolio of powersports vehicles and pontoon boats, the launch of new models, and our debut as a public company on Nasdaq,” says David Shan, founder, chairman and CEO. “Sales of UTVs, ATVs, and electric bikes increased 32.4% to $103.3 million, and pontoon boats were up 37.9% to $11.7 million in 2024.”

Shan says sales of powersports vehicles were driven by higher volumes and lower sales returns, and pontoon boats were fueled by an increase in post-pandemic demand for the Massimo brand. “The increase in group sales was followed by significant margin improvement as the effects of the pandemic in 2022 subsided, including a decline in global container freight costs,” he adds.

“During the fourth quarter, while we focused on holiday order fulfillment, we also introduced exciting new products to the brand. Massimo Motor added two all-new models to its 2024 ATV lineup, geared toward riders who seek a high-quality vehicle at an affordable price. These ATVs are built with powerful 4-stroke engines, electronic fuel injection, and on-demand 4WD with locking differential and are now shipping to dealerships nationwide. We also launched an all-new 2024 1000 UTV with a 997cc, 4-stroke V-twin engine. We also continued marketing efforts to promote our brand at industry-leading events and expos around the country.”

In the marine segment, Massimo launched the all-new 2024 25-Foot Ultra Lounger Tritoon, available only in a tritoon configuration featuring three full-length tubes and a pair of 5-inch lifting strakes on all three tubes. The company’s new 30-foot double-decker Tritoon comes in various engine configurations. Shan says the new models are the result of consumer demands and trends, such as the Double Decker’s aluminum slide with a waterspout that comes factory-equipped.

“Operationally, the closing of our $5.85 million IPO and listing of our shares on the Nasdaq represents a significant milestone to support our growth. Being listed on a national exchange increases corporate visibility, improves liquidity, and raises awareness of Massimo in the financial markets. To support this growth, we hired Dave McMahon as a media advisor, bringing expertise of the powersports dealership landscape to contribute to the Massimo portfolio of brands and products, including Massimo Motor, Massimo Marine, and Massimo Electric.

Looking ahead, Shan says the support from its IPO will help the company advance initiatives to improve gross margins while continuing to grow revenue. “We expect to expand our footprint with new distribution centers in California and the Southeast of the U.S. to reduce the time and expense associated with delivering products, replacement parts, and accessories to customers, distributors, and retailers. We are working to expand and diversify our supplier base to drive down our product costs, reduce supply chain risks, and improve quality control. Combined with new investments in infrastructure at our 286,000-square-foot assembly facility in Texas to increase operating efficiencies, we believe we can further enhance margins. We also believe that these investments position us as we continue to expand and diversify our product line with new models and capabilities.”

Shan says the last several months were focused on building a foundation for the year ahead. “I look forward to continued execution in the months ahead as we strive to create long-term value for our shareholders,” he concludes.

Q4 2023 Financial Results

For the three months ended December 31, 2023, revenues increased by $14.6 million, or 58.5%, to $39.6 million, compared to $25.0 million in the prior year period. The fourth quarter increase in revenue was principally due to Massimo’s expansion at major chain stores and its dealer network, and the reduction of impacts felt from the COVID-19 pandemic on manufacturing and the supply chain from 2022.

Revenue from sales of UTVs, ATVs and electric bikes increased by $14.6 million, or 63.9%, from $22.9 million in the fourth quarter of 2022 to $37.5 million in the fourth quarter of 2023. The increase in revenue was attributable to a decrease in sales return. Starting from 2023, Massimo says it strategically reduced the sales return rate by changing customer type and adjusting its customer composition with different return policies that are gradually shifting sales from big box with liberal return policies, such as Costco, to big box with no or limited return policies such as Tractor Supply Co.

Revenue from sales of Pontoon Boats was flat, with $2.0 million and $2.0 million in the fourth quarter of 2022 and 2023, respectively.

Gross profit increased by $5.3 million, or 77.8%, from $6.8 million in the fourth quarter of 2022 to $12.1 million in the fourth quarter of 2023. Gross profit margin was 30.7% in the fourth quarter of 2023, as compared with 27.4% in the prior-year quarter. The increase in the gross profit margin was primarily attributable to higher net sales partly due to decreased returns, according to the company, as well as the lower cost of sales due to reduced freight costs in the fourth quarter of 2023 as compared to the previous year.

Cost of revenue on UTVs, ATVs, and electric bikes increased by $9.8 million, or 60.0%, from $16.5 million in the fourth quarter of 2022 to $26.3 million in 2023 and gross profit increased by $4.8 million, or 73.9%, from $6.4 million in the fourth quarter of 2022 to $11.2 million in 2023. Gross profit margin increased by 1.7%, from 28.1% in the fourth quarter of 2022 to 29.9% in fiscal 2023. The increased cost of revenue was in line with the increase in sales. The company notes the increase in gross profit margin was mainly due to a significant decline in global container freight since mid-2022.

The cost of revenue on Pontoon Boats decreased by $0.6 million, or 34.8%, from $1.7 million from the fourth quarter of 2022 to $1.1 million in the fourth quarter of 2023, and gross profit increased by $0.5 million, or 142.8%, from $0.4 million in the fourth quarter of 2022 to $0.9 million in the fourth quarter of 2023. Gross profit margin increased by 27.3%, from 18.5% in the fourth quarter of 2022 to 45.9% in the fourth quarter 2023.

Total operating expenses increased by 16.6% to $7.4 million for the fourth quarter of 2023, compared to $6.4 million in the prior year fourth quarter.

Fiscal Year 2023 Financial Results

Revenues increased by $28.5 million, or 32.9%, from $86.5 million in fiscal 2022 to $115.0 million in fiscal 2023. The increase in revenue was principally due to Massimo’s expansion at major chain stores and our dealer network.

Revenue from sales of UTVs, ATVs and electric bikes increased by $25.3 million, or 32.4%, from $78.0 million in fiscal 2022 to $103.3 million in fiscal 2023. The increase was primarily due to higher sales volume in fiscal 2023 compared with that in fiscal 2022 and a decrease in sales return.

Revenue from sales of Pontoon Boats increased by $3.2 million, or 37.9%, from $8.5 million in fiscal 2022 to $11.7 million in fiscal 2023. The company says the increase in revenue was primarily attributable to strong demand in the Pontoon Boat market after stock supply returned to normal levels after the COVID-19 pandemic and more resources were spent on advertising and promoting the Massimo Marine brand.

Massimo’s gross profit increased by $13.7 million, or 61.7%, from $22.2 million in fiscal 2022 to $35.9 million in fiscal 2023. The gross profit margin was 31.2% in fiscal 2023, compared with 25.7% in fiscal 2022. The increase of 5.5% in the gross profit margin was primarily attributable to higher net sales, partly due to decreased return and lower cost of sales.

For more information, visit massimomotor.com and massimomarine.com.