UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2021

Commission File No. 1-16263

MARINE PRODUCTS CORPORATION

(exact name of registrant as specified in its charter)

Delaware	58-2572419
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

2801 Buford Highway, Suite 300, Atlanta, Georgia 30329

(Address of principal executive offices) (zip code)

Registrant’s telephone number, including area code -- (404) 321-7910

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:		Trading Symbol(s)		Name of each exchange on which registered:
Common stock, par value $0.10		MPX		New York Stock Exchange

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. Yes ⌧ 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). Yes ⌧ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	⌧
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging Growth Company	☐

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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

As of July 23, 2021, Marine Products Corporation had 33,993,854 shares of common stock outstanding.

Table of Contents

Marine Products Corporation

Table of Contents

		Page No.
Part I. Financial Information

Item 1.	Financial Statements (Unaudited)

	Consolidated Balance Sheets – As of June 30, 2021 and December 31, 2020	3

	Consolidated Statements of Operations – for the three and six months ended June 30, 2021 and 2020	4

	Consolidated Statements of Comprehensive Income – for the three and six months ended June 30, 2021 and 2020	5

	Consolidated Statements of Stockholders’ Equity – for the six months ended June 30, 2021 and 2020	6

	Consolidated Statements of Cash Flows – for the six months ended June 30, 2021 and 2020	7

	Notes to Consolidated Financial Statements	8 - 15

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16 - 22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23

Item 4.	Controls and Procedures	23

Part II. Other Information

Item 1.	Legal Proceedings	24

Item 1A.	Risk Factors	24

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	24

Item 3.	Defaults upon Senior Securities	24

Item 4.	Mine Safety Disclosures	24

Item 5.	Other Information	24

Item 6.	Exhibits	25

Signatures		26

Table of Contents

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2021 AND DECEMBER 31, 2020

(In thousands)

(Unaudited)


	June 30,		December 31,
	2021		2020
ASSETS			(Note 1)
Cash and cash equivalents	$	28,609	$	31,573
Accounts receivable, net of allowance for doubtful accounts of $12 in 2021 and $16 in 2020		7,941		4,706
Inventories		57,109		42,310
Income taxes receivable		303		—
Prepaid expenses and other current assets		2,455		1,947
Total current assets		96,417		80,536
Property, plant and equipment, net of accumulated depreciation of $30,963 in 2021 and $30,066 in 2020		14,582		14,938
Goodwill		3,308		3,308
Other intangibles, net		465		465
Deferred income taxes		4,192		4,075
Other assets		17,293		16,100
Total assets	$	136,257	$	119,422

LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable	$	12,796	$	6,079
Accrued expenses and other liabilities		17,268		15,583
Total current liabilities		30,064		21,662
Pension liabilities		14,443		12,524
Other long-term liabilities		714		717
Total liabilities		45,221		34,903
Common stock		3,399		3,387
Capital in excess of par value		—		—
Retained earnings		89,556		83,079
Accumulated other comprehensive loss		(1,919)		(1,947)
Total stockholders’ equity		91,036		84,519
Total liabilities and stockholders’ equity	$	136,257	$	119,422

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(In thousands except per share data)

(Unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Net sales	$	67,259	$	40,818	$	145,634	$	99,937
Cost of goods sold		52,651		32,987		112,564		79,999
Gross profit		14,608		7,831		33,070		19,938
Selling, general and administrative expenses		7,245		5,757		15,682		13,010
Operating income		7,363		2,074		17,388		6,928
Interest income		10		15		18		76
Income before income taxes		7,373		2,089		17,406		7,004
Income tax provision		1,579		382		3,515		1,089
Net income	$	5,794	$	1,707	$	13,891	$	5,915
Earnings per share
Basic	$	0.17	$	0.05	$	0.41	$	0.17
Diluted	$	0.17	$	0.05	$	0.41	$	0.17
Dividends paid per share	$	0.12	$	0.08	$	0.22	$	0.20

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2021 AND 2020

(In thousands)

(Unaudited)


	Three months ended June 30,				Six months ended June 30,
	2021		2020		2021		2020
Net income	$	5,794	$	1,707	$	13,891	$	5,915
Other comprehensive income, net of taxes:
Pension adjustment		14		19		28		138
Comprehensive income	$	5,808	$	1,726	$	13,919	$	6,053

The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

MARINE PRODUCTS CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2021

(In thousands)

(Unaudited)


								Accumulated
				Capital in				Other
	Common Stock			Excess of		Retained		Comprehensive
	Shares	Amount		Par Value		Earnings		Income (Loss)		Total
Balance, December 31, 2020	33,869	$	3,387	$	—	$	83,079	$	(1,947)	$	84,519
Stock issued for stock incentive plans, net	189		18		535		—		—		553
Stock purchased and retired	(64)		(6)		(535)		(509)		—		(1,050)
Net income	—		—		—		8,097		—		8,097
Pension adjustment, net of taxes	—		—		—		—		14		14
Dividends paid	—		—		—		(3,398)		—		(3,398)
Balance, March 31, 2021	33,994	$	3,399	$	—	$	87,269	$	(1,933)	$	88,735
Stock issued for stock incentive plans, net	—		—		571		—		—		571
Stock purchased and retired	—		—		(571)		570		—		(1)
Net income	—		—		—		5,794		—		5,794
Pension adjustment, net of taxes	—		—		—		—		14		14
Dividends paid	—		—		—		(4,077)		—		(4,077)
Balance, June 30, 2021	33,994	$	3,399	$	—	$	89,556	$	(1,919)	$	91,036

FOR THE SIX MONTHS ENDED JUNE 30, 2020

(In thousands)

(Unaudited)


								Accumulated
				Capital in				Other
	Common Stock			Excess of		Retained		Comprehensive
	Shares	Amount		Par Value		Earnings		Income (Loss)		Total
Balance, December 31, 2019	33,870	$	3,387	$	—	$	76,573	$	(2,748)	$	77,212
Stock issued for stock incentive plans, net	175		18		558		—		—		576
Stock purchased and retired	(73)		(8)		(558)		(489)		—		(1,055)
Net income	—		—		—		4,208		—		4,208
Pension adjustment, net of taxes	—		—		—		—		119		119

SEC Form 10-Q filed by Marine Products Corporation