10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)
☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2020

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-36290

MALIBU BOATS, INC.

(Exact Name of Registrant as specified in its charter)

Delaware	5075 Kimberly Way,	Loudon,	Tennessee	37774	46-4024640
(State or other jurisdiction of incorporation or organization)	(Address of principal executive offices, including zip code)				(I.R.S. Employer Identification No.)

(865)	458-5478
(Registrant’s telephone number, including area code)

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.01	MBUU	Nasdaq Global Select 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. 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, 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 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	☑

Class A Common Stock, par value $0.01, outstanding as of February 8, 2021:	20,761,182	shares
Class B Common Stock, par value $0.01, outstanding as of February 8, 2021:	11	shares

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION	1
Item 1.	Financial Statements	1
	Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)	1
	Condensed Consolidated Balance Sheets (Unaudited)	2
	Condensed Consolidated Statements of Stockholders' Equity (Unaudited)	3
	Condensed Consolidated Statements of Cash Flows (Unaudited)	5
	Notes to Unaudited Condensed Consolidated Financial Statements	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	41
Item 4.	Controls and Procedures	41
PART II	OTHER INFORMATION	42
Item 1.	Legal Proceedings	42
Item 1A.	Risk Factors	42
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 3.	Defaults Upon Senior Securities	43
Item 4.	Mine Safety Disclosures	43
Item 5.	Other Information	43
Item 6.	Exhibits	44
SIGNATURES		45

i

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements. All statements other than statements of historical facts contained in this Form 10-Q are forward-looking statements, including statements regarding the effects of the COVID-19 pandemic on us; demand for our products and expected industry trends, our business strategy and plans, our prospective products or products under development, our vertical integration initiatives, our acquisition strategy and management’s objectives for future operations. In particular, many of the statements under the heading “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” constitute forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue,” the negative of these terms, or by other similar expressions that convey uncertainty of future events or outcomes to identify these forward-looking statements. These statements are only predictions, involving known and unknown risks, uncertainties and other factors that may cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Such factors include, but are not limited to: the effects of the COVID-19 pandemic on us; general industry, economic and business conditions; significant fluctuations in our annual and quarterly financial results; unfavorable weather conditions, policies impacting access to waterways and shelter-in-place orders; our reliance on our network of independent dealers and increasing competition for dealers; the financial health of our dealers and their continued access to financing; our obligation to repurchase inventory of certain dealers; the success of our engine integration strategy; our reliance on certain suppliers for our engines and outboard motors; our reliance on third-party suppliers for raw materials and components and any interruption of our informal supply arrangements; our ability to meet our manufacturing workforce needs; exposure to workers' compensation claims and other workplace liabilities; our ability to grow our business through acquisitions and integrate such acquisitions to fully realize their expected benefits, including our recent acquisition of Maverick Boat Group; our growth strategy which may require us to secure significant additional capital; our large fixed cost base; intense competition within our industry; increased consumer preference for used boats or the supply of new boats by competitors in excess of demand; the successful introduction of new products; competition with other activities for consumers’ scarce leisure time; the continued strength of our brands; our ability to execute our manufacturing strategy successfully; our exposure to claims for product liability and warranty claims; our dependence on key personnel; our ability to protect our intellectual property; disruptions to our network and information systems; risks inherent in operating in foreign jurisdictions; rising concern regarding international tariffs; changes in currency exchange rates; an increase in energy and fuel costs; any failure to comply with laws and regulations including environmental and other regulatory requirements; a natural disaster, global pandemic or other disruption at our manufacturing facilities; increases in income tax rates or changes in income tax laws; covenants in our credit agreement governing our revolving credit facility and term loan which may limit our operating flexibility; our variable rate indebtedness which subjects us to interest rate risk; and any failure to maintain effective internal control over financial reporting or disclosure controls or procedures. We discuss many of these factors, risks and uncertainties in greater detail under the heading “Item 1A. Risk Factors” in our Form 10-K for the year ended June 30, 2020, filed with the Securities and Exchange Commission on August 31, 2020, as such disclosures may be amended, supplemented or superseded from time to time by other reports we file with the Securities and Exchange Commission, including subsequent annual reports on Form 10-K and quarterly reports on Form 10-Q.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Actual results may differ materially from those suggested by the forward-looking statements for various reasons. Except as required by law, we assume no obligation to update forward-looking statements for any reason after the date of this Form 10-Q to conform these statements to actual results or to changes in our expectations.

ii

Part I - Financial Information

Item 1. Financial Statements

MALIBU BOATS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)

(In thousands, except share and per share data)

	Three Months Ended  December 31,				Six Months Ended  December 31,
	2020		2019		2020		2019
Net sales	$	195,647	$	180,112	$	376,631	$	352,192
Cost of sales	146,158		140,244		281,401		272,323
Gross profit	49,489		39,868		95,230		79,869
Operating expenses:
Selling and marketing	4,001		4,666		7,613		9,732
General and administrative	15,036		10,078		26,690		20,746
Amortization	1,524		1,537		3,048		3,121
Operating income	28,928		23,587		57,879		46,270
Other (income) expense, net:
Other income, net	(12)		(9)		(22)		(19)
Interest expense	445		957		1,001		2,124
Other expense, net	433		948		979		2,105
Income before provision for income taxes	28,495		22,639		56,900		44,165
Provision for income taxes	6,348		5,041		12,715		9,885
Net income	22,147		17,598		44,185		34,280
Net income attributable to non-controlling interest	922		876		1,867		1,699
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Comprehensive income:
Net income	$	22,147	$	17,598	$	44,185	$	34,280
Other comprehensive income (loss):
Change in cumulative translation adjustment	1,422		615		2,052		(8)
Other comprehensive income (loss)	1,422		615		2,052		(8)
Comprehensive income	23,569		18,213		46,237		34,272
Less: comprehensive income attributable to non-controlling interest	981		907		1,953		1,699
Comprehensive income attributable to Malibu Boats, Inc.	$	22,588	$	17,306	$	44,284	$	32,573
Weighted average shares outstanding used in computing net income per share:
Basic	20,717,359		20,591,241		20,684,644		20,710,681
Diluted	20,972,902		20,701,473		20,946,800		20,816,830
Net income available to Class A Common Stock per share:
Basic	$	1.03	$	0.81	$	2.05	$	1.57
Diluted	$	1.01	$	0.81	$	2.02	$	1.57

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements (Unaudited).

1

MALIBU BOATS, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)

(In thousands, except share and per share data)

	December 31, 2020		June 30, 2020
Assets
Current assets
Cash	$	23,729	$	33,787
Trade receivables, net	14,361		13,767
Inventories, net	96,001		72,946
Prepaid expenses and other current assets	5,908		3,954
Total current assets	139,999		124,454
Property, plant and equipment, net	120,888		94,310
Goodwill	101,215		51,273
Other intangible assets, net	239,606		139,892
Deferred tax assets	50,618		52,935
Other assets	18,022		14,482
Total assets	$	670,348	$	477,346
Liabilities
Current liabilities
Current maturities of long-term obligations	$	1,250	$	—
Accounts payable	28,655		15,846
Accrued expenses	65,717		50,485
Income taxes and tax distribution payable	3,072		243
Payable pursuant to tax receivable agreement, current portion	3,589		3,589
Total current liabilities	102,283		70,163
Deferred tax liabilities	28,569		14
Other liabilities	21,036		16,727
Payable pursuant to tax receivable agreement, less current portion	46,619		46,076
Long-term debt	162,357		82,839
Total liabilities	360,864		215,819
Commitments and contingencies (See Note 16)
Stockholders' Equity
Class A Common Stock, par value $0.01 per share, 100,000,000 shares authorized; 20,753,463 shares issued and outstanding as of December 31, 2020; 20,595,969 issued and outstanding as of June 30, 2020	206		204
Class B Common Stock, par value $0.01 per share, 25,000,000 shares authorized; 12 shares issued and outstanding as of December 31, 2020; 15 shares issued and outstanding as of June 30, 2020	—		—
Preferred Stock, par value $0.01 per share; 25,000,000 shares authorized; no shares issued and outstanding as of December 31, 2020 and June 30, 2020	—		—
Additional paid in capital	106,771		103,797
Accumulated other comprehensive loss	(1,080)		(3,132)
Accumulated earnings	196,029		153,711
Total stockholders' equity attributable to Malibu Boats, Inc.	301,926		254,580
Non-controlling interest	7,558		6,947
Total stockholders’ equity	309,484		261,527
Total liabilities and stockholders' equity	$	670,348	$	477,346

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements (Unaudited).

2

MALIBU BOATS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders' Equity (Unaudited)

(In thousands, except number of Class B shares)

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Accumulated Other Comprehensive Loss		Accumulated Earnings		Non-controlling Interest in LLC		Total Stockholders' Equity
	Shares	Amount		Shares	Amount
Balance at June 30, 2020	20,596	$	204	15	$	—	$	103,797	$	(3,132)	$	153,711	$	6,947	$	261,527
Net income	—	—		—	—		—		—		21,093		945		22,038
Stock based compensation, net of withholding taxes on vested equity awards	(3)	—		—	—		658		—		—		—		658
Issuances of equity for services	—	—		—	—		59		—		—		—		59
Issuances of equity for exercise of stock options	9	—		—	—		300		—		—		—		300
Increase in payable pursuant to the tax receivable agreement	—	—		—	—		(330)		—		—		—		(330)
Increase in deferred tax asset from step-up in tax basis	—	—		—	—		480		—		—		—		480
Exchange of LLC Units for Class A Common Stock	28	—		(2)	—		264		—		—		(264)		—
Distributions to LLC Unit holders	—	—		—	—		—		—		—		(449)		(449)
Foreign currency translation adjustment	—	—		—	—		—		630		—		22		652
Balance at September 30, 2020	20,630	$	204	13	$	—	$	105,228	$	(2,502)	$	174,804	$	7,201	$	284,935
Net income	—	—		—	—		—		—		21,225		922		22,147
Stock based compensation, net of withholding taxes on vested equity awards	110	2		—	—		750		—		—		—		752
Issuances of equity for services	1	—		—	—		659		—		—		—		659
Increase in payable pursuant to the tax receivable agreement	—	—		—	—		(213)		—		—		—		(213)
Increase in deferred tax asset from step-up in tax basis	—	—		—	—		229		—		—		—		229
Exchange of LLC Units for Class A Common Stock	12	—		(1)	—		118		—		—		(118)		—
Distributions to LLC Unit holders	—	—		—	—		—		—		—		(495)		(495)
Foreign currency translation adjustment	—	—		—	—		—		1,422		—		48		1,470
Balance at December 31, 2020	20,753	$	206	12	$	—	$	106,771	$	(1,080)	$	196,029	$	7,558	$	309,484

3

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Accumulated Other Comprehensive Loss		Accumulated Earnings		Non-controlling Interest in LLC		Total Stockholders' Equity
	Shares	Amount		Shares	Amount
Balance at June 30, 2019	20,853	$	207	15	$	—	$	113,004	$	(2,828)	$	93,852	$	6,118	$	210,353
Net Income	—	—		—	—		—		—		15,859		823		16,682
Stock based compensation, net of withholding taxes on vested equity awards	(5)	—		—	—		435		—		—		—		435
Issuances of equity for services	—	—		—	—		80		—		—		—		80
Repurchase and retirement of common stock	(383)	(4)		—	—		(11,119)		—		—		—		(11,123)
Cumulative-effect transition adjustment for ASC 842	—	—		—	—		—		—		(1,703)		—		(1,703)
Distributions to LLC Unit Holders	—	—		—	—		—		—		—		(399)		(399)
Foreign currency translation adjustment	—	—		—	—		—		(623)		—		(25)		(648)
Balance at September 30, 2019	20,465	$	203	15	$	—	$	102,400	$	(3,451)	$	108,008	$	6,517	$	213,677
Net Income	—	—		—	—		—		—		16,722		876		17,598
Stock based compensation, net of withholding taxes on vested equity awards	116	1		—	—		236		—		—		—		237
Issuances of equity for services	2	—		—	—		655		—		—		—		655
Distributions to LLC Unit Holders	—	—		—	—		—		—		—		(446)		(446)
Foreign currency translation adjustment	—	—		—	—		—		615		—		25		640
Balance at December 31, 2019	20,583	$	204	15	$	—	$	103,291	$	(2,836)	$	124,730	$	6,972	$	232,361

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements (Unaudited).

4

MALIBU BOATS, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	Six Months Ended December 31,
	2020		2019
Operating activities:
Net income	$	44,185	$	34,280
Adjustments to reconcile net income to net cash provided by operating activities:
Non-cash compensation expense	2,611		1,490
Non-cash compensation to directors	421		415
Depreciation	7,085		6,102
Amortization	3,048		3,121
Deferred income taxes	3,051		2,794
Other items, net	568		1,034
Change in operating assets and liabilities (excluding effects of acquisition):
Trade receivables	2,702		12,125
Inventories	(14,692)		(9,022)
Prepaid expenses and other assets	(2,178)		(675)
Accounts payable	8,980		1,155
Income taxes payable	3,537		(1,234)
Accrued expenses	13,356		1,668
Other liabilities	(73)		(744)
Net cash provided by operating activities	72,601		52,509
Investing activities:
Purchases of property, plant and equipment	(11,525)		(19,313)
Payment for acquisition, net of cash acquired	(150,427)		—
Net cash used in investing activities	(161,952)		(19,313)
Financing activities:
Proceeds from long-term borrowings	25,000		—
Proceeds from revolving credit facility	65,000		—
Payments on revolving credit facility	(8,800)		(20,000)
Payment of deferred financing costs	(638)		—
Proceeds received from exercise of stock options	300		—
Cash paid for withholding taxes on vested restricted stock	(1,171)		(811)
Distributions to LLC Unit holders	(553)		(969)
Repurchase and retirement of common stock	—		(11,123)
Net cash provided by (used in) financing activities	79,138		(32,903)
Effect of exchange rate changes on cash	155		22
Changes in cash	(10,058)		315
Cash—Beginning of period	33,787		27,392
Cash—End of period	$	23,729	$	27,707
Supplemental cash flow information:
Cash paid for interest	$	787	$	2,133
Cash paid for income taxes	6,478		7,300

The accompanying notes are an integral part of the Condensed Consolidated Financial Statements (Unaudited).

5

MALIBU BOATS, INC. AND SUBSIDIARIES

Notes to Unaudited Condensed Consolidated Financial Statements

(Dollars in thousands, except per unit and per share data)

1. Organization, Basis of Presentation, and Summary of Significant Accounting Policies

Organization

Malibu Boats, Inc. (together with its subsidiaries, the “Company” or "Malibu"), a Delaware corporation formed on November 1, 2013, is the sole managing member of Malibu Boats Holdings, LLC, a Delaware limited liability company (the "LLC"). The Company operates and controls all of the LLC's business and affairs and, therefore, pursuant to Financial Accounting Standards Board ("FASB") Accounting Standards Codification (“ASC”) Topic 810, Consolidation, consolidates the financial results of the LLC and its subsidiaries, and records a non-controlling interest for the economic interest in the Company held by the non-controlling holders of units in the LLC ("LLC Units"). Malibu Boats Holdings, LLC was formed in 2006. The LLC, through its wholly owned subsidiary, Malibu Boats, LLC, (“Boats LLC”), is engaged in the design, engineering, manufacturing and marketing of innovative, high-quality, recreational powerboats that are sold through a world-wide network of independent dealers. On December 31, 2020, the Company acquired all of the outstanding stock of Maverick Boat Group, Inc. (“Maverick Boat Group”). As a result of the acquisition, the Company consolidates the financial results of the Maverick Boat Group. Maverick Boat Group designs and manufactures center console, dual console, flats and bay boats under four brands -- Cobia, Pathfinder, Maverick and Hewes brands. In addition to the Maverick Boat Group’s family of brands, the Company sells its boats under the Malibu, Axis, Cobalt and Pursuit brands. In connection with the acquisition of Maverick Boat Group, the Company revised its segment reporting to report its results of operations under three reportable segments -- Malibu, Cobalt and Saltwater Fishing.

COVID-19 Pandemic

The COVID-19 pandemic has impacted the Company’s operations and financial results since the third quarter of fiscal year 2020 and continues to impact the Company. The Company elected to suspend operations at all of its facilities on March 24, 2020. The shut-down continued into the fourth quarter 2020 with operations resuming between late April and early May, depending on the facility. As a result, the Company was not able to ship boats to its dealers during the period of shut-down, which negatively impacted its net sales for the second half of fiscal year 2020. In addition, the COVID-19 pandemic has impacted and may continue to impact the operations of the Company’s dealers and suppliers. The future impact of COVID-19 on the Company’s financial condition and results of operations will depend on a number of factors, including factors that we may not be able to forecast at this time.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim condensed financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and disclosures of results of operations, financial position and changes in cash flow in conformity with GAAP for complete financial statements. Such statements should be read in conjunction with the audited consolidated financial statements and notes thereto of Malibu Boats, Inc. and subsidiaries for the year ended June 30, 2020, included in the Company's Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Units and shares are presented as whole numbers while all dollar amounts are presented in thousands, unless otherwise noted.

Acquisition of Maverick Boat Group, Inc. and Related Financing

On December 31, 2020, MBG Holdco, Inc., a wholly-owned subsidiary of Boats, LLC, acquired all of the outstanding shares of Maverick Boat Group from its existing stockholders for a purchase price of $150,675. The purchase price was subject to customary adjustments for the amounts of cash, indebtedness and working capital in the business at the closing date and subject to adjustment for certain capital expenditures made by Maverick Boat Group prior to closing at the Company’s request. With two manufacturing facilities located in Fort Pierce, Florida, Maverick Boat Group designs and manufactures center console, dual console, flats and bay boats under four brand names Cobia, Pathfinder, Maverick, and Hewes. The Company paid the purchase price with cash on hand and $90,000 of borrowings under its credit facilities following an amendment to increase the amount available under its credit facilities as described below.

On December 30, 2020, Boats, LLC, as the borrower, entered into the Third Incremental Facility Amendment and Third Amendment (the “Third Amendment”) to its existing Second Amended and Restated Credit Agreement dated as of June 28,

6

2017, by and among Boats LLC, the LLC and certain subsidiaries of Boats LLC parties thereto, as guarantors, the lenders parties thereto and Truist Bank (successor by merger to SunTrust Bank), as administrative agent, swingline lender and issuing bank (as amended, the “Credit Agreement”). The Third Amendment added a $25,000 incremental term loan facility with a maturity date of July 1, 2024 and increased the borrowing capacity available under the revolving credit facility by $50,000 from $120,000 to $170,000. The $25,000 incremental term loans made pursuant to the Third Amendment is subject to quarterly amortization at a rate of 5.0% per annum through December 31, 2022 and at a rate of 7.5% per annum thereafter and accrues interest at the same rate as other loans under the Credit Agreement.

Refer to Notes 4, 10 and 17 for further information.

Segment Information

Effective December 31, 2020, the Company revised its segment reporting to account for its acquisition of Maverick Boat Group and conform to changes in its internal management reporting based on the Company’s boat manufacturing operations. The Company previously had three reportable segments, Malibu, Cobalt and Pursuit. The Company now aggregates Pursuit and Maverick Boat Group into one reportable segment as they have similar economic characteristics and qualitative factors. As a result the Company continues to have three reportable segments, Malibu, Cobalt and Saltwater Fishing. See Note 17.

Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements include the operations and accounts of the Company and all subsidiaries thereof. All intercompany balances and transactions have been eliminated upon consolidation.

Recent Accounting Pronouncements

In June 2016, the FASB issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and in November 2018 issued a subsequent amendment, ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 will replace today’s “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. ASU 2018-19 will affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope of this amendment that have the contractual right to receive cash. On July 1, 2020, the Company adopted this standard and the adoption did not have a material impact on the Company’s consolidated financial position, results of operations, equity or cash flows.

There are no other new accounting pronouncements that are expected to have a significant impact on the Company's consolidated financial statements and related disclosures.

2. Revenue Recognition

The following table disaggregates the Company's revenue by major product type and geography:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	105,687	$	46,932	$	39,423	$	192,042	$	199,681	$	90,337	$	75,826	$	365,844
Part and other sales	2,930		546		129		3,605		8,767		1,623		397		10,787
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Revenue by geography:
North America	$	98,242	$	45,196	$	36,841	$	180,279	$	194,160	$	89,149	$	72,591	$	355,900
International	10,375		2,282		2,711		15,368		14,288		2,811		3,632		20,731
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631

7

	Three Months Ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	94,350	$	48,579	$	33,715	$	176,644	$	176,433	$	97,879	$	69,521	$	343,833
Part and other sales	2,977		415		76		3,468		6,774		1,266		319		8,359
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Revenue by geography:
North America	$	89,643	$	46,822	$	33,114	$	169,579	$	168,560	$	95,580	$	65,365	$	329,505
International	7,684		2,172		677		10,533		14,647		3,565		4,475		22,687
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192

Boat and Trailer Sales

Consists of sales of boats and trailers to the Company's dealer network, net of sales returns, discounts, rebates and free flooring incentives. Boat and trailer sales also includes optional boat features. Sales returns consist of boats returned by dealers under our warranty program. Rebates, free flooring and discounts are incentives that the Company provides to its dealers based on sales of eligible products.

Parts and Other Sales

Consists primarily of parts and accessories sales, royalty income and clothing sales. Parts and accessories sales include replacement and aftermarket boat parts and accessories sold to the Company's dealer network. Royalty income is earned from license agreements with various boat manufacturers, including Nautique, Chaparral, Mastercraft, and Tige related to the use of the Company's intellectual property.

3. Non-controlling Interest

The non-controlling interest on the unaudited interim condensed consolidated statement of operations and comprehensive income represents the portion of earnings attributable to the economic interest in the Company's subsidiary, Malibu Boats Holdings, LLC, held by the non-controlling LLC Unit holders. Non-controlling interest on the unaudited interim condensed consolidated balance sheets represents the portion of net assets of the Company attributable to the non-controlling LLC Unit holders, based on the portion of the LLC Units owned by such Unit holders. The ownership of Malibu Boats Holdings, LLC is summarized as follows:

	As of December 31, 2020			As of June 30, 2020
	Units	Ownership %		Units	Ownership %
Non-controlling LLC Unit holders ownership in Malibu Boats Holdings, LLC	691,305	3.2	%	730,652	3.4	%
Malibu Boats, Inc. ownership in Malibu Boats Holdings, LLC	20,753,463	96.8		20,595,969	96.6
	21,444,768	100.0	%	21,326,621	100.0	%

Issuance of Additional LLC Units

Under the first amended and restated limited liability company agreement of the LLC, as amended (the "LLC Agreement"), the Company is required to cause the LLC to issue additional LLC Units to the Company when the Company issues additional shares of Class A Common Stock. Other than in connection with the issuance of Class A Common Stock in connection with an equity incentive program, the Company must contribute to the LLC net proceeds and property, if any, received by the Company with respect to the issuance of such additional shares of Class A Common Stock. The Company must cause the LLC to issue a number of LLC Units equal to the number of shares of Class A Common Stock issued such that, at all times, the number of LLC Units held by the Company equals the number of outstanding shares of Class A Common Stock. During the six months ended December 31, 2020, the Company caused the LLC to issue a total of 167,159 LLC Units to the Company in connection with (i) the Company's issuance of Class A Common Stock to a non-employee director for her services, (ii) the issuance of Class A Common Stock for the vesting of awards granted under the Malibu Boats, Inc. Long-Term Incentive Plan (the

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"Incentive Plan"), (iii) the issuance of restricted Class A Common Stock granted under the Incentive Plan (iv) the issuance of Class A Common Stock to LLC Unit holders in exchange of their LLC Units and (v) the issuance of Class A Common Stock for the exercise of options granted under the Incentive Plan. During the six months ended December 31, 2020, 9,665 LLC Units were canceled in connection with the vesting of share-based equity awards to satisfy employee tax withholding requirements and the retirement of 9,665 treasury shares in accordance with the LLC Agreement.

Distributions and Other Payments to Non-controlling Unit Holders

Distributions for Taxes

As a limited liability company (treated as a partnership for income tax purposes), Malibu Boats Holdings, LLC does not incur significant federal, state or local income taxes, as these taxes are primarily the obligations of its members. As authorized by the LLC Agreement, the LLC is required to distribute cash, to the extent that the LLC has cash available, on a pro rata basis, to its members to the extent necessary to cover the members’ tax liabilities, if any, with respect to their share of LLC earnings. The LLC makes such tax distributions to its members based on an estimated tax rate and projections of taxable income. If the actual taxable income of the LLC multiplied by the estimated tax rate exceeds the tax distributions made in a calendar year, the LLC may make true-up distributions to its members, if cash or borrowings are available for such purposes. As of December 31, 2020 and June 30, 2020, tax distributions payable to non-controlling LLC Unit holders were $495 and $104, respectively. During the six months ended December 31, 2020 and 2019, tax distributions paid to the non-controlling LLC Unit holders were $553 and $969, respectively.

Other Distributions

Pursuant to the LLC Agreement, the Company has the right to determine when distributions will be made to LLC members and the amount of any such distributions. If the Company authorizes a distribution, such distribution will be made to the members of the LLC (including the Company) pro rata in accordance with the percentages of their respective LLC units.

4. Acquisitions

On December 31, 2020, the Company completed its acquisition of all the outstanding stock of Maverick Boat Group. The aggregate purchase price for the transaction was $150,675, funded with cash and borrowings under the Company's credit facilities. The aggregate purchase price was subject to certain adjustments, including customary adjustments for the amount of cash, indebtedness and working capital in the business at the closing date and subject to adjustment for certain capital expenditures made by Maverick Boat Group prior to closing at the Company’s request. The Company accounted for the transaction in accordance with ASC Topic 805, Business Combinations.

The total consideration given to the stockholders of Maverick Boat Group has been allocated to the assets acquired and liabilities assumed based on preliminary estimates of fair value as of the date of the acquisition. The preliminary measurements of fair value were determined based upon estimates utilizing the assistance of third party valuation specialists, and are subject to change within the measurement period (up to one year from the acquisition date). The Company expects appraisals of tangible and intangible assets and working capital adjustments to be finalized during the second half of fiscal 2021.

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The following table summarizes the preliminary purchase price allocation based on the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:

Consideration:
Cash consideration paid	$	150,675
Recognized preliminary amounts of identifiable assets acquired and (liabilities assumed), at fair value:
Cash	$	248
Accounts receivable	3,204
Inventories	7,756
Other current assets	194
Property, plant and equipment	22,618
Identifiable intangible assets	102,600
Other assets	4,410
Current liabilities	(6,611)
Deferred tax liabilities	(28,528)
Other liabilities	(4,405)
Fair value of assets acquired and liabilities assumed	101,486
Goodwill	49,189
Total purchase price	$	150,675

The preliminary fair value estimates for the Company's identifiable intangible assets acquired as part of the acquisition are as follows:

	Estimates of Fair Value		Estimated Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	47,900	20
Total definite-lived intangibles	47,900
Indefinite-lived intangible:
Trade name	54,700
Total intangible assets	$	102,600

The preliminary value allocated to inventories reflects the estimated fair value of the acquired inventory based on the expected sales price of the inventory, less an estimated cost to complete and a reasonable profit margin. The fair value of the identifiable intangible assets were determined based on the following approaches:

Dealer Relationships - The value associated with Maverick Boat Group's dealer relationships is attributed to its long standing dealer distribution network. The estimate of fair value assigned to this asset was determined using the income approach, which requires an estimate or forecast of the expected future cash flows from the dealer relationships through the application of the multi-period excess earnings approach. The estimated remaining useful life of dealer relationships is approximately twenty years.

Trade Name - The value attributed to Maverick Boat Group's trade names was determined using a variation of the income approach called the relief from royalty method, which requires an estimate or forecast of the expected future cash flows. The trade name has an indefinite life.

The fair value of the definite-lived intangible assets are being amortized using the straight-line method to general and administrative expenses over their estimated useful lives. Indefinite-lived intangible assets are not amortized, but instead are evaluated for potential impairment on an annual basis in accordance with the provisions of ASC Topic 350, Intangibles—Goodwill and Other. The weighted average useful life of identifiable definite-lived intangible assets acquired was 20 years. Goodwill of $49,189 arising from the acquisition consists of expected synergies and cost savings as well as intangible assets that do not qualify for separate recognition.

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Acquisition-related costs of $2,577, which were incurred by the Company in the first six months of fiscal year 2021 related to the Maverick Boat Group acquisition, were expensed in the period incurred, and are included in general and administrative expenses in the consolidated statement of operations and comprehensive income for the six months ended December 31, 2020.

Pro Forma Financial Information (unaudited):

The following unaudited pro forma consolidated results of operations for the three and six months ended December 31, 2020 and 2019, assumes that the acquisition of Maverick Boat Group occurred as of July 1, 2019. The unaudited interim pro forma financial information combines historical results of Malibu and Maverick Boat Group, with adjustments for depreciation and amortization attributable to preliminary fair value estimates on acquired tangible and intangible assets for the respective periods. Non-recurring pro forma adjustments associated with the fair value step up of inventory were included in the reported pro forma cost of sales and earnings. The unaudited interim pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal year 2020 or the results that may occur in the future:

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Net sales	$	224,348	$	211,113	$	432,651	$	417,001
Net income	23,287		19,102		46,500		36,200
Net income attributable to Malibu Boats, Inc.	22,335		18,179		44,572		34,457
Basic earnings per share	$	1.08	$	0.88	$	2.16	$	1.66
Diluted earnings per share	$	1.06	$	0.88	$	2.13	$	1.66

5. Inventories

Inventories, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Raw materials	$	68,078	$	52,530
Work in progress	17,973		10,778
Finished goods	9,950		9,638
Total inventories	$	96,001	$	72,946

6. Property, Plant and Equipment

Property, plant and equipment, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Land	$	3,960	$	2,540
Building and leasehold improvements	73,437		54,318
Machinery and equipment	61,475		55,831
Furniture and fixtures	7,762		7,031
Construction in process	14,214		10,470
	160,848		130,190
Less: Accumulated depreciation	(39,960)		(35,880)
Property, plant and equipment, net	$	120,888	$	94,310

Depreciation expense was $3,599 and $3,005 for the three months ended December 31, 2020 and 2019, respectively, and $7,085 and $6,102 for the six months ended December 31, 2020 and 2019, respectively substantially all of which was recorded in cost of sales.

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7. Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill for the six months ended December 31, 2020 were as follows:

Goodwill as of June 30, 2020	$	51,273
Addition related to the acquisition of Maverick Boat Group	49,189
Effect of foreign currency changes on goodwill	753
Goodwill as of December 31, 2020	$	101,215

The components of other intangible assets were as follows:

	As of December 31, 2020		As of June 30, 2020		Estimated Useful Life (in years)	Weighted Average Remaining Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	159,459	$	111,293	8-20	18.1
Patent	3,986		3,986		12-15	11.5
Trade name	24,667		24,667		15	1.1
Non-compete agreement	54		48		10	3.8
Total	188,166		139,994
Less: Accumulated amortization	(66,760)		(63,602)
Total definite-lived intangible assets, net	121,406		76,392
Indefinite-lived intangible:
Trade name	118,200		63,500
Total other intangible assets, net	$	239,606	$	139,892

Amortization expense recognized on all amortizable intangibles was $1,524 and $1,537 for the three months ended December 31, 2020 and 2019, respectively, and $3,048 and $3,121 for the six months ended December 31, 2020 and 2019, respectively.

The estimated future amortization of definite-lived intangible assets is as follows:

Fiscal years ending June 30:		Amount
	Remainder of 2021	$	4,206
	2022	6,967
	2023	6,830
	2024	6,830
	2025	6,826
	2026 and thereafter	89,747
		$	121,406

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8. Accrued Expenses

Accrued expenses consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Warranties	$	31,046	$	27,500
Dealer incentives	11,685		7,777
Accrued compensation	11,826		9,885
Current operating lease liabilities	1,977		2,006
Accrued legal and professional fees	2,114		1,055
Customer deposits	5,194		1,059
Other accrued expenses	1,875		1,203
Total accrued expenses	$	65,717	$	50,485

9. Product Warranties

Malibu and Axis brand boats have a limited warranty for a period up to five years for both Malibu and Axis brand boats. The Company’s Cobalt brand boats have (1) a structural warranty of up to ten years which covers the hull, deck joints, bulkheads, floor, transom, stringers, and motor mount and (2) a five year bow-to-stern warranty on all components manufactured or purchased (excluding hull and deck structural components), including canvas and upholstery. Gelcoat is covered up to three years for Cobalt and one year for Malibu and Axis. Pursuit brand boats have (1) a limited warranty for a period of up to five years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of two years (excluding hull and deck structural components). Maverick, Pathfinder and Hewes brand boats have (1) a limited warranty for a period of up to five years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of one year (excluding hull and deck structural components). Cobia brand boats have (1) a limited warranty for a period of up to ten years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of three years (excluding hull and deck structural components). For each boat brand, there are certain materials, components or parts of the boat that are not covered by the Company’s warranty and certain components or parts that are separately warranted by the manufacturer or supplier (such as the engine). Engines that the Company manufactures for Malibu and Axis models have a limited warranty of up to five years or five-hundred hours.

The Company’s standard warranties require it or its dealers to repair or replace defective products during the warranty period at no cost to the consumer. The Company estimates warranty costs it expects to incur and records a liability for such costs at the time the product revenue is recognized. The Company utilizes historical claims trends and analytical tools to develop the estimate of its warranty obligation on a per boat basis, by brand and warranty year. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims and cost per claim. The Company assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Beginning in model year 2016, the Company increased the term of its limited warranty for Malibu brand boats from three years to five years and for Axis brand boats from two years to five years. Beginning in model year 2018, the Company increased the term of its bow-to-stern warranty for Cobalt brand boats from three years to five years. As a result of these changes, all of the Company’s Malibu, Axis and Cobalt brand boats with historical claims experience that are no longer covered under warranty had warranty terms shorter than the current warranty term of five years. Accordingly, the Company has little to no historical claims experience for warranty years four and five, and as such, these estimates give rise to a higher level of estimation uncertainty. Future warranty claims may differ from the Company’s estimate of the warranty liability, which could lead to changes in the Company’s warranty liability in future periods.

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Changes in the Company’s product warranty liability, which is included in accrued expenses on the unaudited interim condensed consolidated balance sheets, were as follows: 

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Beginning balance	$	29,077	$	25,034	$	27,500	$	23,820
Add: Warranty expense	4,791		5,196		9,646		9,102
Additions for acquisitions	883		—		883		—
Less: Warranty claims paid	(3,705)		(3,520)		(6,983)		(6,212)
Ending balance	$	31,046	$	26,710	$	31,046	$	26,710

10. Financing

Outstanding debt consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Term loan	$	100,000	$	75,000
Revolving credit loan	65,000		8,800
Less unamortized debt issuance costs	(1,393)		(961)
Total debt	163,607		82,839
Less current maturities	(1,250)		—
Long-term debt less current maturities	$	162,357	$	82,839

Long-Term Debt

As of December 31, 2020, the Company has a revolving credit facility with borrowing capacity of up to $170,000 and term loans with an aggregate principal amount of $100,000 outstanding. As of December 31, 2020, the Company had $65,000 outstanding under its revolving credit facility and $1,234 in outstanding letters of credit, with $103,766 available for borrowing. The revolving credit facility matures on July 1, 2024, the incremental term loan made on December 30, 2020 in a principal amount of $25,000 (the “Incremental Term Loan”) matures on July 1, 2024 and the remaining $75,000 of outstanding term loans (the “Existing Term Loans,” and together with the Incremental Term Loans, the “Term Loans”) mature on July 1, 2022.

On December 30, 2020, Boats LLC entered into the Third Amendment to its Credit Agreement. The Third Amendment added a $25,000 Incremental Term Loan facility with a maturity date of July 1, 2024 and increased the borrowing capacity of the revolving credit facility by $50,000 from $120,000 to $170,000. The Incremental Term Loan is subject to quarterly amortization at a rate of 5.0% per annum through December 31, 2022 and at a rate of 7.5% per annum through June 30, 2024 and accrues interest at the same interest rate applicable to other loans under the Credit Agreement as described below.

The obligations of Boats LLC under the Credit Agreement are guaranteed by the LLC, and, subject to certain exceptions, the present and future domestic subsidiaries of Boats LLC, and all such obligations are secured by substantially all of the assets of the LLC, Boats LLC and such subsidiary guarantors. Malibu Boats, Inc. is not a party to the Credit Agreement. Borrowings under the Credit Agreement bear interest at a rate equal to either, at the Company's option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.5%, or one-month LIBOR plus 1% (the “Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 1.25% to 2.25% with respect to LIBOR borrowings and 0.25% to 1.25% with respect to Base Rate borrowings. The applicable margin will be based upon the consolidated leverage ratio of the LLC and its subsidiaries calculated on a consolidated basis. As of December 31, 2020, the interest rate on the Company’s term loans and revolving credit facility was 1.39%. The Company is required to pay a commitment fee for any unused portion of the revolving credit facility which will range from 0.20% to 0.40% per annum, depending on the LLC’s and its subsidiaries’ consolidated leverage ratio.

The Credit Agreement permits prepayment of the Term Loans without any penalties. The Existing Term Loans require an amortization payment of approximately $3,000 on March 31, 2022 and the balance of the Existing Term Loans is due on the scheduled maturity date of July 1, 2022. The Incremental Term Loan of $25,000 is subject to quarterly amortization at a rate of 5.0% per year through December 31, 2022, resulting in $1,250 being reflected as current maturities of long-term obligations, 7.5% per year through June 30, 2024 and the balance of the Incremental Term Loan is due on the scheduled maturity date of

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July 1, 2024. The Credit Agreement also requires prepayments from the net cash proceeds received by Boats LLC or any guarantors from certain asset sales and recovery events, subject to certain reinvestment rights, and from excess cash flow, subject to the terms and conditions of the Credit Agreement.

The Credit Agreement contains certain customary representations and warranties, and notice requirements for the occurrence of specific events such as the occurrence of any event of default, or pending or threatened litigation. The Credit Agreement also requires compliance with certain customary financial covenants, including a minimum ratio of EBITDA to fixed charges and a maximum ratio of total debt to EBITDA. The Credit Agreement contains certain restrictive covenants, which, among other things, place limits on certain activities of the loan parties under the Credit Agreement, such as the incurrence of additional indebtedness and additional liens on property and limit the future payment of dividends or distributions. For example, the Credit Agreement generally prohibits the LLC, Boats LLC and the subsidiary guarantors from paying dividends or making distributions, including to the Company. The credit facility permits, however, (i) distributions based on a member’s allocated taxable income, (ii) distributions to fund payments that are required under the LLC’s tax receivable agreement, (iii) purchase of stock or stock options of the LLC from former officers, directors or employees of loan parties or payments pursuant to stock option and other benefit plans up to $3,000 in any fiscal year, and (iv) share repurchase payments up to $35,000 in any fiscal year subject to one year carry forward and compliance with other financial covenants. In addition, the LLC may make dividends and distributions of up to $10,000 in any fiscal year, subject to compliance with other financial covenants.

In connection with entering into the Credit Agreement, the Company capitalized $2,074 in deferred financing costs during fiscal 2017. In connection with Third Amendment the Company capitalized $638 in deferred financing costs during the six months ended December 31, 2020. These costs, in addition to the unamortized balance related to costs associated with the Company's previous credit facility of $671, are being amortized over the term of the Credit Agreement into interest expense using the effective interest method and presented as a direct offset to the total debt outstanding on the consolidated balance sheets.

The Company used proceeds from an offering on August 24, 2017 to repay $50,000 on its Existing Term Loans under the Credit Agreement and exercised its option to apply the prepayment to principal installments through December 31, 2021, and a portion of principal installments due on March 31, 2022. The $50,000 repayment resulted in a write off of deferred financing costs of $829 in fiscal year 2018, which was included in amortization expense on the consolidated statement of operations and comprehensive income.

Covenant Compliance

As of December 31, 2020, the Company was in compliance with the financial covenants contained in the Credit Agreement.

Interest Rate Swap

On July 1, 2015, the Company entered into a five year floating to fixed interest rate swap with an effective start date of July 1, 2015. The swap was based on a one-month LIBOR rate versus a 1.52% fixed rate on a notional value of $39,250, which under terms of the previously existing credit agreement, was equal to 50% of the outstanding balance of the term loan at the time of the swap arrangement. Under ASC Topic 815, Derivatives and Hedging, all derivative instruments are recorded on the unaudited interim condensed consolidated balance sheets at fair value as either short term or long term assets or liabilities based on their anticipated settlement date. The Company has elected not to designate its interest rate swap as a hedge for accounting purposes; therefore, changes in the fair value of the derivative instrument were being recognized in earnings in the Company's unaudited interim condensed consolidated statements of operations and comprehensive income. The swap matured on March 31, 2020. For the three and six months ended December 31, 2019, the Company recorded a loss of $20 and $58, respectively, for the change in fair value of the interest rate swap, which was included in interest expense in the unaudited interim condensed consolidated statements of operations and comprehensive income.

11. Leases

The Company leases certain manufacturing facilities, warehouses, office space, land, and equipment. The Company determines if a contract is a lease or contains an embedded lease at the inception of the agreement. The Company recorded right-of-use assets, included in other assets on the consolidated balance sheet, totaling $16,142 as of July 1, 2019. Leases with an initial term of 12 months or less are not recorded on the unaudited interim condensed consolidated balance sheet. The Company does not separate non-lease components from the lease components to which they relate, and instead accounts for each separate lease and non-lease component associated with that lease component as a single lease component for all underlying asset classes. The Company's lease liabilities do not include future lease payments related to options to extend or terminate lease agreements as it is not reasonably certain those options will be exercised.

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Other information concerning the Company's operating leases accounted for under ASC Topic 842, Leases is as follows (in thousands):

Classification		As of December 31, 2020		As of June 30, 2020
Assets
Right-of-use assets	Other assets	$	13,473	$	14,315
Liabilities
Current operating lease liabilities	Accrued expenses	$	1,977	$	2,006
Long-term operating lease liabilities	Other liabilities	13,162		14,013
Total lease liabilities		$	15,139	$	16,019

Classification		Three Months Ended December 31, 2020		Three months ended December 31, 2019		Six Months Ended December 31, 2020		Six Months Ended December 31, 2019
Operating lease costs (1)	Cost of sales	$	504	$	473	$	1,012	$	950
	Selling and marketing, and general and administrative	208		220		422		443
Sublease income	Other income, net	10		9		19		19
Cash paid for amounts included in the measurement of operating lease liabilities	Cash flows from operating activities	652		655		1,309		1,302

(1) Includes short-term leases, which are insignificant, and are not included in the lease liability.

The lease liability for operating leases that contain variable escalating rental payments with scheduled increases that are based on the lesser of a stated percentage increase or the cumulative increase in an index, are determined using the stated percentage increase.

The weighted average remaining lease term for the three months ended December 31, 2020 and 2019 was 6.93 years and 7.73 years, respectively. The weighted average discount rate determined based on the Company's incremental borrowing rate is 3.65%, as of December 31, 2020 and 2019.

Future annual minimum lease payments for the following fiscal years as of December 31, 2020 are as follows:

	Amount
Remainder of 2021	$	1,268
2022	2,433
2023	2,484
2024	2,608
2025	2,314
2026 and thereafter	6,015
Total	17,122
Less imputed interest	(1,983)
Present value of lease liabilities	$	15,139

12. Tax Receivable Agreement Liability

The Company has a tax receivable agreement with the pre-IPO owners of the LLC that provides for payment by the Company to the pre-IPO owners (or their permitted assignees) of 85% of the amount of the benefits, if any, that the Company is

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deemed to realize as a result of (i) increases in tax basis and (ii) certain other tax benefits related to the Company entering into the tax receivable agreement, including those attributable to payments under the tax receivable agreement. These contractual payment obligations are obligations of the Company and not of the LLC. The Company's tax receivable agreement liability was determined on an undiscounted basis in accordance with ASC Topic 450, Contingencies, since the contractual payment obligations were deemed to be probable and reasonably estimable. The tax receivable agreement further provides that, upon certain mergers, asset sales or other forms of business combinations or other changes of control, the Company (or its successor) would owe to the pre-IPO owners of the LLC a lump-sum payment equal to the present value of all forecasted future payments that would have otherwise been made under the tax receivable agreement that would be based on certain assumptions, including a deemed exchange of LLC Units and that the Company would have sufficient taxable income to fully utilize the deductions arising from the increased tax basis and other tax benefits related to entering into the tax receivable agreement. The Company also is entitled to terminate the tax receivable agreement, which, if terminated, would obligate the Company to make early termination payments to the pre-IPO owners of the LLC. In addition, a pre-IPO owner may elect to unilaterally terminate the tax receivable agreement with respect to such pre-IPO owner, which would obligate the Company to pay to such existing owner certain payments for tax benefits received through the taxable year of the election.

For purposes of the tax receivable agreement, the benefit deemed realized by the Company will be computed by comparing the actual income tax liability of the Company (calculated with certain assumptions) to the amount of such taxes that the Company would have been required to pay had there been no increase to the tax basis of the assets of the LLC as a result of the purchases or exchanges, and had the Company not entered into the tax receivable agreement.

The following table reflects the changes to the Company's tax receivable agreement liability:

	As of December 31, 2020		As of June 30, 2020
Payable pursuant to tax receivable agreement	$	49,665	$	53,754
Additions (reductions) to tax receivable agreement:
Exchange of LLC Units for Class A Common Stock	543		1,041
Adjustment for change in estimated tax rate	—		(1,672)
Payments under tax receivable agreement	—		(3,458)
	50,208		49,665
Less current portion under tax receivable agreement	(3,589)		(3,589)
Payable pursuant to tax receivable agreement, less current portion	$	46,619	$	46,076

When estimating the expected tax rate to use in order to determine the tax benefit expected to be recognized from the Company’s increased tax basis as a result of exchanges of LLC Units by the pre-IPO owners of the LLC, the Company continuously monitors changes in its overall tax posture, including changes resulting from new legislation and changes as a result of new jurisdictions in which the Company is subject to tax.

As of December 31, 2020 and June 30, 2020, the Company had deferred tax assets of $112,220 and $111,511, respectively, associated with basis differences in assets upon acquiring an interest in Malibu Boats Holdings, LLC and pursuant to making an election under Section 754 of the Internal Revenue Code of 1986 (the "Internal Revenue Code"), as amended. The aggregate tax receivable agreement liability represents 85% of the tax benefits that the Company expects to receive in connection with the Section 754 election. In accordance with the tax receivable agreement, the next annual payment is anticipated approximately 75 days after filing the federal tax return due by April 15, 2021.

13. Income Taxes

Malibu Boats, Inc. is taxed as a C corporation for U.S. income tax purposes and is therefore subject to both federal and state taxation at a corporate level. The LLC continues to operate in the United States as a partnership for U.S. federal income tax purposes.

Income taxes are computed in accordance with ASC Topic 740, Income Taxes, and reflect the net tax effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and the corresponding income tax amounts. The Company has deferred tax assets and liabilities and maintains valuation allowances where it is more likely than not that all or a portion of deferred tax assets will not be realized. To the extent the Company determines that it will not realize the benefit of some or all of its deferred tax assets, such deferred tax assets will be adjusted through the Company’s provision for income taxes in the period in which this determination is made.

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As of December 31, 2020 and June 30, 2020, the Company maintained a total valuation allowance of $14,693 and $14,582, respectively, against deferred tax assets related to state net operating losses and future amortization deductions (with respect to the Section 754 election) that are reported in the Tennessee corporate tax return without offsetting income, which is taxable at the LLC. This also includes a valuation allowance in the amount of $580 related to foreign tax credit carryforward that is not expected to be utilized in the future.

The Company’s consolidated interim effective tax rate is based upon expected annual income from operations, statutory tax rates and tax laws in the various jurisdictions in which the Company operates. Significant or unusual items, including those related to the change in U.S. tax law as well as other adjustments to accruals for tax uncertainties, are recognized in the quarter in which the related event occurs. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The CARES Act contains significant business tax provisions, including modifications to the rules limiting the deductibility of net operating losses (NOLs), expensing of qualified improvement property (QIP) and business interest in Internal Revenue Code Sections 172(a) and 163(j), respectively. The effects of the new legislation are recognized upon enactment. The Company did not recognize any significant impact to income tax expense for the six months ended December 31, 2020 relating to the CARES Act.

For the three months ended December 31, 2020 and 2019, the Company's effective tax rate was 22.3% and 22.3%, respectively. For the six months ended December 31, 2020 and 2019, the Company's effective tax rate was 22.3% and 22.4%, respectively. For the three and six months ended December 31, 2020 and 2019, the Company's effective tax rate exceeded the statutory federal income tax rate of 21% primarily due to the impact of U.S. state taxes. This increase in tax rate in both periods was partially offset by a windfall benefit generated by certain stock based compensation, and benefits from the foreign derived intangible income deduction, the research and development tax credit, and the impact of non-controlling interests in the LLC.

14. Stock-Based Compensation

The Company adopted a long term incentive plan which became effective on January 1, 2014, and reserves for issuance up to 1,700,000 shares of Malibu Boats, Inc. Class A Common Stock for the Company’s employees, consultants, members of its board of directors and other independent contractors at the discretion of the compensation committee. Incentive stock awards authorized under the Incentive Plan include unrestricted shares of Class A Common Stock, stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent awards and performance awards. As of December 31, 2020, 600,104 shares remain available for future issuance under the long term incentive plan.

On November 3, 2020, under the Incentive Plan, the Company granted approximately 33,000 restricted service based stock units and 25,000 restricted service based stock awards to key employees under the Incentive Plan. The grant date fair value of these awards was $3,145 based on a stock price of $54.47 per share on the date of grant. Approximately 58% of the awards vest ratably over three years and approximately 42% of the awards vest ratably over four years. Stock-based compensation expense attributable to the service based units and awards is amortized on a straight-line basis over the requisite service period.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 restricted stock awards with a performance condition. The number of shares that will ultimately be issued, if any, is based on the attainment of a specified amount of earnings during the fiscal year ending June 30, 2023. The maximum number of shares that can be issued if an elevated earnings target is met is approximately 28,000. The grant date fair value of the awards were estimated to be $1,002, based on a stock price of $54.47. Compensation costs associated with the performance awards are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 stock awards with a market condition. The number of shares that will ultimately be issued, if any, is based on a total shareholder return ("TSR") computation that involves comparing the movement in the Company's stock price to movement in a market index from the grant date through November 6, 2023. The maximum number of shares that can be issued if an elevated TSR target is met is approximately 37,000. The grant date fair value of the awards were estimated to be $1,293, which is estimated using a Monte Carlo simulation. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award grant and calculates the fair market value for the stock award. Compensation costs are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

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The following is a summary of the changes in the Company's stock options for the six months ended December 31, 2020:

	Shares	Weighted Average Exercise Price/Share
Total outstanding options as of June 30, 2020	173,348	$	32.61
Options granted	—	—
Options exercised	(9,625)	31.14
Outstanding options as of December 31, 2020	163,723	32.70
Exercisable as of December 31, 2020	82,744	$	31.46

The following is a summary of the changes in non-vested restricted stock units and restricted stock awards for the six months ended December 31, 2020:

	Number of Restricted Stock Units and Restricted Stock Awards Outstanding	Weighted Average Grant Date Fair Value
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of June 30, 2020	277,696	$	35.43
Granted	134,044	54.41
Vested	(90,154)	32.10
Forfeited	(1,592)	36.63
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of December 31, 2020	319,994	$	44.31

Stock compensation expense attributable to the Company's share-based equity awards was $1,800 and $813 for the three months ended December 31, 2020 and 2019, respectively, and $2,611 and $1,490 for the six months ended December 31, 2020 and 2019. Stock compensation expense attributed to share-based equity awards issued under the Incentive Plan is recognized on a straight-line basis over the terms of the respective awards and is included in general and administrative expense in the Company's unaudited interim condensed consolidated statement of operations and comprehensive income. Awards vesting during the three and six months ended December 31, 2020 include 10,826 and 11,951 fully vested restricted stock units issued to non-employee directors for their service as directors for the Company.

15. Net Earnings Per Share

Basic net income per share of Class A Common Stock is computed by dividing net income attributable to the Company's earnings by the weighted average number of shares of Class A Common Stock outstanding during the period. The weighted average number of shares of Class A Common Stock outstanding used in computing basic net income per share includes fully vested restricted stock units awarded to directors that are entitled to participate in distributions to common shareholders through receipt of additional units of equivalent value to the dividends paid to Class A Common Stock holders.

Diluted net income per share of Class A Common Stock is computed similarly to basic net income per share except the weighted average shares outstanding are increased to include additional shares from the assumed exercise of any common stock equivalents using the treasury method, if dilutive. The LLC Units and non-qualified stock options are considered common stock equivalents for this purpose. The number of additional shares of Class A Common Stock related to these common stock equivalents and stock options are calculated using the treasury stock method.

Stock awards with a performance condition that are based on the attainment of a specified amount of earnings are only included in the computation of diluted earnings per share to the extent that the performance condition would be achieved based on the current amount of earnings, and only if the effect would be dilutive.

Stock awards with a market condition that are based on the performance of the Company's stock price in relation to a market index over a specified time period are only included in the computation of diluted earnings per share to the extent that the shares would be issued based on the current market price of the Company's stock in relation to the market index, and only if the effect would be dilutive.

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Basic and diluted net income per share of Class A Common Stock has been computed as follows (in thousands, except share and per share amounts):

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Basic:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing basic net income per share:
Weighted-average Class A Common Stock	20,493,938		20,385,815		20,464,902		20,510,896
Weighted-average participating restricted stock units convertible into Class A Common Stock	223,421		205,426		219,742		199,785
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Basic net income per share	$	1.03	$	0.81	$	2.05	$	1.57
Diluted:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Restricted stock units granted to employees	153,918		81,661		159,058		81,394
Stock options granted to employees	42,361		4,404		43,834		588
Market performance awards granted to employees	59,264		24,167		59,264		24,167
Diluted weighted-average shares outstanding 1	20,972,902		20,701,473		20,946,800		20,816,830
Diluted net income per share	$	1.01	$	0.81	$	2.02	$	1.57

1 The Company excluded (i) 745,055 and 940,875 potentially dilutive shares from the calculation of diluted net income per share for the three months ended December 31, 2020 and 2019, respectively, and (ii) 733,805 and 1,042,509 potentially dilutive shares from the calculation of diluted net income per share for the six months ended December 31, 2020 and 2019, respectively, as these units would have been antidilutive.

The shares of Class B Common Stock do not share in the earnings or losses of Malibu Boats, Inc. and, therefore, not included in the calculation. Accordingly, basic and diluted net earnings per share of Class B Common Stock has not been presented.

16. Commitments and Contingencies

Repurchase Commitments

In connection with its dealers’ wholesale floor plan financing of boats, the Company has entered into repurchase agreements with various lending institutions. The reserve methodology used to record an estimated expense and loss reserve in each accounting period is based upon an analysis of likely repurchases based on current field inventory and likelihood of repurchase. Subsequent to the inception of the repurchase commitment, the Company evaluates the likelihood of repurchase and adjusts the estimated loss reserve accordingly. When a potential loss reserve is recorded it is presented in accrued liabilities in the accompanying unaudited interim condensed consolidated balance sheet. If the Company were obligated to repurchase a significant number of units under any repurchase agreement, its business, operating results and financial condition could be adversely affected. The total amount financed under the floor financing programs with repurchase obligations was $180,634 and $161,356 as of December 31, 2020 and June 30, 2020, respectively.

Repurchases and subsequent sales are recorded as a revenue transaction. The net difference between the repurchase price and the resale price is recorded against the loss reserve and presented in cost of sales in the accompanying unaudited interim condensed consolidated statements of operations and comprehensive income. During the three and six months ended December 31, 2020, there were no repurchases and as of December 31, 2020, the Company has not been notified about any probable repossessions. Therefore, the Company did not carry a reserve for repurchases as of December 31, 2020 consistent with June 30, 2020.

The Company has collateralized receivables financing arrangements with a third-party floor plan financing provider

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for European dealers. Under terms of these arrangements, the Company transfers the right to collect a trade receivable to the financing provider in exchange for cash but agrees to repurchase the receivable if the dealer defaults. Since the transfer of the receivable to the financing provider does not meet the conditions for a sale under ASC Topic 860, Transfers and Servicing, the Company continues to report the transferred trade receivable in other current assets with an offsetting balance recorded as a secured obligation in accrued expenses in the Company's unaudited condensed consolidated balance sheets. As of December 31, 2020 and June 30, 2020, the Company had financing receivables of $165 and $375, respectively, recorded in other current assets and accrued expenses related to these arrangements.

Contingencies

Product Liability

The Company is engaged in a business that exposes it to claims for product liability and warranty claims in the event the Company’s products actually or allegedly fail to perform as expected or the use of the Company’s products results, or is alleged to result, in property damage, personal injury or death. Although the Company maintains product and general liability insurance of the types and in the amounts that the Company believes are customary for the industry, the Company is not fully insured against all such potential claims. The Company may have the ability to refer claims to its suppliers and their insurers to pay the costs associated with any claims arising from the suppliers’ products. The Company’s insurance covers such claims that are not adequately covered by a supplier’s insurance and provides for excess secondary coverage above the limits provided by the Company’s suppliers.

The Company may experience legal claims in excess of its insurance coverage or claims that are not covered by insurance, either of which could adversely affect its business, financial condition and results of operations. Adverse determination of material product liability and warranty claims made against the Company could have a material adverse effect on its financial condition and harm its reputation. In addition, if any of the Company products are, or are alleged to be, defective, the Company may be required to participate in a recall of that product if the defect or alleged defect relates to safety. These and other claims that the Company faces could be costly to the Company and require substantial management attention. Refer to Note 9 for discussion of warranty claims. The Company insures against product liability claims and believes there are no material product liability claims as of December 31, 2020 that would not be covered by our insurance.

Legal Proceedings

On January 12, 2018, the Company filed suit against Skier’s Choice, Inc., or "Skier’s Choice," in the U.S. District Court for the Eastern District of Tennessee, seeking monetary and injunctive relief. The Company's complaint alleges Skier’s Choice’s infringement of three utility patents - U.S. Patent Nos. 9,260,161, 8,578,873, and 9,199,695 - related to wake surfing technology. Skier’s Choice denied liability arising from the causes of action alleged in the Company's complaint and filed counterclaims alleging invalidity of the asserted patents. On June 19, 2019, the Company filed a second action against Skier’s Choice in the U.S. District Court for the Eastern District of Tennessee, seeking monetary and injunctive relief.  The Company’s complaint alleges Skier’s Choice’s surf systems on its Moomba and Supra lines of boats infringe U.S. Patent No. 10,322,777, a patent related to wake surfing technology. Skier’s Choice denied liability arising from the causes of action alleged in the Company's complaint and filed counterclaims alleging invalidity of the asserted patents.  On June 27, 2019, Skier’s Choice filed a motion to consolidate these two actions, and to continue deadlines in the earlier case for nine months, which the Company opposed. On August 22, 2019, the motion for consolidation was referred by Judge Thomas Varlan to Magistrate Judge Bruce Guyton, and the two cases were stayed pending resolution of that motion. On November 27, 2019, Judge Guyton ordered the two cases to be consolidated.  On January 7, 2020, the consolidated cases were reassigned to Judge Jon McCalla.  On January 23, 2020, Judge McCalla issued a Scheduling Order, scheduling trial on the consolidated cases to begin on September 29, 2020. On July 23, 2020, the Company moved to dismiss its allegations of infringement of U.S. Patent No. 9,199,695, which Skier’s Choice opposed. On August 25, 2020, Judge McCalla issued a claim construction order and set a scheduling conference for August 27, 2020, for purposes of resetting the pretrial calendar and trial dates. On September 11, 2020, the Court issued a Scheduling Order resetting the trial for the consolidated cases to begin on January 25, 2021. On December 11, 2020, the Court issued an Order resetting the trial for the consolidated cases to begin on May 10, 2021. The Company intends to vigorously pursue this litigation to enforce its rights in its patented technology and believes that Skier’s Choice’s counterclaims are without merit.

17. Segment Information

Effective December 31, 2020, the Company revised its segment reporting to account for its acquisition of Maverick Boat Group and conform to changes in its internal management reporting based on the Company’s boat manufacturing operations. The Company previously had three reportable segments, Malibu, Cobalt and Pursuit. The Company now aggregates Pursuit and Maverick Boat Group into one reportable segment as they have similar economic characteristics and qualitative factors. As a result, the Company continues to have three reportable segments, Malibu, Cobalt and Saltwater Fishing. The Malibu segment

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participates in the manufacturing, distribution, marketing and sale of Malibu and Axis performance sports boats throughout the world. The Cobalt segment participates in the manufacturing, distribution, marketing and sale of Cobalt boats throughout the world. The Saltwater Fishing segment participates in the manufacturing, distribution, marketing and sale throughout the world of Pursuit boats and the Maverick Boat Group brand boats (Maverick, Cobia, Pathfinder and Hewes).

The following tables present financial information for the Company’s reportable segments for the three and six months ended December 31, 2020 and 2019, respectively, and the Company’s financial position at December 31, 2020 and June 30, 2020, respectively:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Income before provision for income taxes	$	17,572	$	5,189	$	5,734	$	28,495	$	35,127	$	9,965	$	11,808	$	56,900
	Three months ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Income before provision for income taxes	$	15,200	$	4,853	$	2,586	$	22,639	$	26,661	$	10,760	$	6,744	$	44,165

	As of December 31, 2020		As of June 30, 2020
Assets
Malibu	$	188,798	$	194,502
Cobalt	156,082		153,820
Saltwater Fishing	325,468		129,024
Total assets	$	670,348	$	477,346

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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

The following discussion and analysis should be read in conjunction with the unaudited interim condensed consolidated financial statements and notes thereto included herein.

Malibu Boats, Inc. is a Delaware corporation with its principal offices in Loudon, Tennessee. We use the terms “Malibu,” the “Company,” “we,” “us,” “our” or similar references to refer to Malibu Boats, Inc., its subsidiary, Malibu Boats Holdings, LLC, or the LLC, and its subsidiary Malibu Boats, LLC, or Boats, LLC and its consolidated subsidiaries, including Cobalt Boats, LLC, PB Holdco, LLC, through which we acquired the assets of Pursuit, and MBG Holdco, Inc., through which we acquired all of the outstanding stock of Maverick Boat Group, Inc. (“Maverick Boat Group”).

Overview

We are a leading designer, manufacturer and marketer of a diverse range of recreational powerboats, including performance sport boats, sterndrive and outboard boats. Our product portfolio of premium brands are used for a broad range of recreational boating activities including, among others, water sports, general recreational boating and fishing. Our passion for consistent innovation, which has led to propriety technology such as Surf Gate, has allowed us to expand the market for our products by introducing consumers to new and exciting recreational activities. We design products that appeal to an expanding range of recreational boaters and water sports enthusiasts whose passion for boating and water sports is a key component of their active lifestyle and provide consumers with a better customer-inspired experience. With performance, quality, value and multi-purpose features, our product portfolio has us well positioned to broaden our addressable market and achieve our goal of increasing our market share in the expanding recreational boating industry.

We currently sell our boats under eight brands—(Malibu; Axis; Cobalt; Pursuit; Maverick; Cobia; Pathfinder; and Hewes), and we report our results of operations under three reportable segments, (Malibu, Cobalt and Saltwater Fishing), as shown in the table below. We revised our segment reporting to report our results of operations under these three reportable segments in connection with our acquisition of Maverick Boat Group on December 31, 2020. See Note 17 to our unaudited interim condensed consolidated financial statements for more information about our reporting segments.

		% of Total Revenues
Segment	Brands	Six months ended December 31, 2020	Fiscal year ended June 30, 2020
Malibu	Malibu	55.4%	54.3%
	Axis
Cobalt	Cobalt	24.4%	26.8%
Saltwater Fishing	Pursuit	20.2%	18.9%
	Maverick
	Cobia
	Pathfinder
	Hewes

Our Malibu segment participates in the manufacturing, distribution, marketing and sale throughout the world of Malibu and Axis performance sports boats. Our flagship Malibu boats offer our latest innovations in performance, comfort and convenience, and are designed for consumers seeking a premium performance sport boat experience. We are the market leader in the United States in the performance sport boat category through our Malibu and Axis Wake Research boat brands. Our Axis boats appeal to consumers who desire a more affordable performance sport boat product but still demand high performance,

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functional simplicity and the option to upgrade key features. Retail prices of our Malibu and Axis boats typically range from $60,000 to $210,000.

Our Cobalt segment participates in the manufacturing, distribution, marketing and sale throughout the world of Cobalt boats. Our Cobalt boats consist of mid to large-sized luxury cruisers and bowriders that we believe offer the ultimate experience in comfort, performance and quality. We are the market leader in the United States in the 20’ - 40’ segment of the sterndrive boat category through our Cobalt brand. Retail prices for our Cobalt boats typically range from $60,000 to $450,000.

Our Saltwater Fishing segment participates in the manufacturing, distribution, marketing and sale throughout the world of Pursuit boats and the Maverick Boat Group family of boats (Maverick, Cobia, Pathfinder and Hewes). Our Pursuit boats expand our product offerings into the saltwater outboard fishing market and include center console, dual console and offshore models. As noted below, we recently acquired Maverick Boat Group and added Maverick, Cobia, Pathfinder and Hewes to our brands. Our Maverick family of boats are highly complementary to Pursuit, expanding our saltwater outboard offerings with a strong focus in length segments under 30 feet. We are among the market leaders in the fiberglass outboard fishing boat category with the brands in our Saltwater Fishing segment. Retail prices for our Saltwater Fishing boats typically range from $50,000 to $1,200,000.

We sell our boats through a dealer network that we believe is the strongest in the recreational powerboat category. As of December 31, 2020, our worldwide distribution channel consisted of over 400 dealer locations globally. Our dealer base is an important part of our consumers’ experience, our marketing efforts and our brands. We devote significant time and resources to find, develop and improve the performance of our dealers and believe our dealer network gives us a distinct competitive advantage.

On a consolidated basis, we achieved second quarter fiscal 2021 net sales, gross profit, net income and adjusted EBITDA of $195.6 million, $49.5 million, $22.1 million and $39.1 million, respectively, compared to $180.1 million, $39.9 million, $17.6 million and $30.7 million, respectively, for the second quarter of fiscal 2020. For the second quarter of fiscal 2021, net sales increased 8.6%, gross profit increased 24.1%, net income increased 25.8% and adjusted EBITDA increased 27.5% as compared to the second quarter of fiscal 2020. For the definition of adjusted EBITDA and a reconciliation to net income, see “GAAP Reconciliation of Non-GAAP Financial Measures.”

Acquisition of Maverick Boat Group, Inc. and Related Financing

On December 31, 2020, we acquired all of the outstanding shares of Maverick Boat Group from its existing stockholders for a purchase price of $150.7 million. The purchase price was subject to customary adjustments for the amounts of cash, indebtedness and working capital in the business at the closing date and subject to adjustment for certain capital expenditures made by Maverick Boat Group prior to closing at our request. With two manufacturing facilities located in Fort Pierce, Florida, Maverick Boat Group designs and manufactures center console, dual console, flats and bay boats under four brand names -- Cobia, Pathfinder, Maverick, and Hewes. We paid the purchase price with cash on hand and $90.0 million of borrowings under our credit facilities following an amendment to increase the amount available under the credit facilities as described below.

On December 30, 2020, our subsidiary, Boats, LLC, as the borrower, entered into the Third Incremental Facility Amendment and Third Amendment to its existing Second Amended and Restated Credit Agreement dated as of June 28, 2017 with Truist Bank, as the administrative agent, swingline lender and issuing bank. The third amendment added a $25.0 million incremental term loan facility with a maturity date of July 1, 2024 and increased the borrowing capacity available under the revolving credit facility by $50.0 million from $120.0 million to $170.0 million. The $25.0 million incremental term loan made pursuant to the third amendment is subject to quarterly amortization at a rate of 5.0% per year through December 31, 2022 and at a rate of 7.5% per year through June 30, 2024 and accrues interest at the same rate as other loans under the Credit Agreement. See “--Liquidity and Capital Resources--Loans and Commitments” below for more information.

Impact of the COVID-19 Pandemic

The COVID-19 pandemic has impacted our operations and financial results since the third quarter of fiscal year 2020 and continues to impact us. On March 24, 2020, we elected to suspend operations at all of our facilities. The shut-down continued into the fourth quarter of fiscal year 2020 with operations resuming between late April and early May, depending on the facility. As a result, we were not able to ship boats to our dealers during the period of shut-down, which negatively impacted our net sales for the second half of fiscal year 2020. In addition, we have been managing our production levels in anticipation of supply chain constraints, which we have begun to experience in recent weeks. While our net sales were negatively impacted during the second half of fiscal year 2020 because of lower production levels, retail sales improved during the summer months as consumers turned to boating as a form of outdoor, socially distanced recreation during the COVID-19 pandemic. The increase in retail sales during the summer months combined with our lower wholesale shipment levels during the second half of fiscal year 2020 resulted in lower inventory levels at our dealers as of December 31, 2020 compared to last year. We expect these

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lower inventory levels, while having the potential to impact retail sales in the near-term, will provide us strong order flow for our model year 2021 product, unless broader economic activity meaningfully contracts and negatively impacts customer demand.

In addition to our operations, the COVID-19 pandemic has impacted and continues to impact the operations of our dealers and suppliers. While some of our dealers and suppliers had to suspend their operations during the pandemic, many continued to operate and we are not aware of any of our dealers or suppliers that have closed permanently. Our suppliers have been impacted by COVID-19 and continue to ramp production to meet increased demand for their products. As mentioned, we have successfully managed our production levels to ensure that challenges related to parts procurement do not impact operations and and we have not experienced any significant shortages.

We believe we are well-positioned to withstand any further disruptions that may occur as result of the ongoing pandemic. We have approximately $23.7 million of cash on hand as of December 31, 2020 and approximately $103.8 million available for borrowing under our revolving credit facility as of December 31, 2020. Further, we have a flexible cost structure that allows us to more closely align our costs with wholesale shipments. The future impact of COVID-19 on our financial condition and results of operations, however, will depend on a number of factors, including factors that we may not be able to forecast at this time. In addition, a recent resurgence of COVID-19 in certain parts of the world, including the United States and parts of Europe, has resulted in the re-imposition of certain restrictions and may lead to more restrictions being implemented again to reduce the spread of COVID-19. These measures could result in further interruptions to our operations and potentially a decrease in consumer spending. See the risk factor “The COVID-19 pandemic is adversely affecting, and is expected to continue to adversely affect, our operations, and those of our dealers and suppliers, thereby adversely affecting our business, financial condition and results of operations.” under Part I. Item 1A. of our Form 10-K for the year ended June 30, 2020.

Outlook

Industry-wide marine retail registrations continue to recover from the years following the global financial crisis. According to Statistical Surveys, Inc., domestic retail registration volumes of performance sport boats, fiberglass sterndrive and fiberglass outboards increased at a compound annual growth rate of approximately 5.2% between 2011 and 2019, for the 50 reporting states. While retail growth in powerboats was negatively impacted by weak retail sales in March and April 2020 due to COVID-19, domestic retail demand growth for powerboats accelerated during calendar year 2020, in part because consumers have turned to boating as a form of outdoor, socially distanced recreation during the COVID-19 pandemic. These increases have been led by growth in our core market, performance sport boats, which produced a double-digit compound annual growth rate between 2011 and 2019 and is primarily served by our Malibu and Axis brands. Outboard boats and fiberglass sterndrive boats have seen their combined market grow at a 4.5% compound annual growth rate between 2011 and 2019. This combined growth has been driven primarily by the outboard market. We target the outboard market with our Pursuit, Cobia, Pathfinder, Maverick and Hewes brands, as well as our Cobalt brand, which is a new entrant to the outboard market, and we plan to meaningfully expand our share of the fiberglass outboard category in the future. We cater to the sterndrive market through our Cobalt brand. While the market for sterndrive propulsion, particularly in lower foot length products, has been challenged, Cobalt’s performance continues to be helped by the higher foot length product market it serves, which has grown and through gains in market share by Cobalt. Despite the impact of COVID-19 early in the year, the acceleration of demand growth during 2020 has been broad based across recreational powerboat categories. We believe the year-over-year domestic retail growth rates for 2020 in the performance sport boat, fiberglass outboard and sterndrive segments will approach 20%, 8% and 9%, respectively.

The combination of continued strong retail market activity through 2020 and the temporary suspension of our operations from March and into May 2020 depleted inventory levels at our dealers below prior year levels and we expect to see meaningful wholesale demand to restock our dealer inventories through fiscal year 2021 and beyond. While we expect lower dealer inventory levels will support fiscal year 2021 financial performance and believe that strength is likely to provide support through fiscal year 2022, numerous other variables have the potential to impact our volumes, both positively and negatively. For example, we believe the substantial decrease in the price of oil, continued strength of the U.S. dollar and recently implemented tariffs has resulted in reduced demand for our boats in certain markets. To date, growth in our domestic market has offset the significantly diminished demand from economies that are driven by the oil industry and international markets. Consumer confidence, expanded or eroded, is a variable that can also impact demand for our products in both directions. Other challenges that could impact demand for recreational powerboats include higher interest rates reducing retail consumer appetite for our product, the availability of credit to our dealers and retail consumers, fuel costs, a meaningful reduction in the value of global or domestic equity markets, the continued acceptance of our new products in the recreational boating market, our ability to compete in the competitive power boating industry, and the costs of labor and certain of our raw materials and key components.

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Since 2008, we have increased our market share among manufacturers of performance sport boats due to new product development, improved distribution, new models, and innovative features. As the market for our product has recovered, our competitors have become more aggressive in their product introductions, increased their distribution and launched surf systems competitive with our patented Surf Gate system. This competitive environment has continued throughout the past few years, with strong performance from Malibu and Axis in 2019 expanding our market share lead over our nearest competitors in the performance sport boats category. However, we believe decreased dealer inventory levels driven by strong retail growth in the second half of 2020 negatively impacted market share and our ability to continue to add inventory at our dealers is important to maintain and grow our market share across our brands. We believe our new product pipeline, strong dealer network and ability to increase production will position us to maintain and potentially expand our industry leading market position in performance sports boats. In addition, we continue to be the market share leader in both the premium and value-oriented product sub-categories for performance sports boats.

We also believe our track record of expanding our market share due to new product development, improved distribution, new models, and innovative features is directly transferable to our Cobalt, Pursuit and Maverick Boat Group acquisitions. While Cobalt, Pursuit and the Maverick brands are market leaders in certain areas, we believe our experience positions us to execute a strategy to drive enhanced share by expanding the Cobalt, Pursuit and Maverick product offerings with different foot lengths, different boat types and different propulsion technologies. Our new product development efforts at Cobalt, Pursuit and Maverick will take time and our ability to influence near-term model introductions is limited, but we have already begun to execute on this strategy. With respect to Cobalt, we introduced five new models of boats during the first half of fiscal year 2021 and we have included Splash and Stow and a new electronic flip down Swim Step for model year 2021 boats. For the Pursuit brand, our focus has been on expanding the award-winning Dual Console, Sport and Offshore product offerings that continue to combine innovative features and dependable performance in refined designs that accommodate a broad array of activities on the water, including the Electric Sliding Entertainment Center on the new S 378. Our newest acquisition, Maverick Boat Group, is in the very early stages of integration into the business and meaningful product and innovation changes will be developed for coming years. We believe enhancing new product development combined with diligent management of the Cobalt, Pursuit and Maverick dealer networks will position us to meaningfully improve our share of the sterndrive and outboard markets over time.

Factors Affecting Our Results of Operations

We believe that our results of operations and our growth prospects are affected by a number of factors, such as the economic environment and consumer demand for our products, our ability to develop new products and innovate, our product mix, our ability to manage manufacturing costs, including through our vertical integration efforts, sales cycles and inventory levels, the strength of our dealer network and our ability to offer dealer financing and incentives. We discuss each of these factors in more detail under the heading “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations--Factors Affecting Our Results of Operations” in our Form 10-K for the year ended June 30, 2020. While we do not have control of all factors affecting our results from operations, we work diligently to influence and manage those factors which we can impact to enhance our results of operations.

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Components of Results of Operations

Net Sales

We generate revenue from the sale of boats to our dealers. The substantial majority of our net sales are derived from the sale of boats, including optional features included at the time of the initial wholesale purchase of the boat. Net sales consists of the following:

•Gross sales from:

•Boat and trailer sales—consists of sales of boats and trailers to our dealer network. Nearly all of our boat sales include optional feature upgrades purchased by the consumer, which increase the average selling price of our boats; and

•Parts and other sales—consists of sales of replacement and aftermarket boat parts and accessories to our dealer network; and consists of royalty income earned from license agreements with various boat manufacturers, including Nautique, Chaparral, Mastercraft, and Tige related to the use of our intellectual property.

•Net sales are net of:

•Sales returns—consists primarily of contractual repurchases of boats either repossessed by the floor plan financing provider from the dealer or returned by the dealer under our warranty program; and

•Rebates, free flooring and discounts—consists of incentives, rebates and free flooring, we provide to our dealers based on sales of eligible products. For our Malibu and Axis models, if a domestic dealer meets its monthly or quarterly commitment volume, as well as other terms of the dealer performance program, the dealer is entitled to a specified rebate. For our Cobalt models, if a domestic dealer meets its quarterly commitment volume, as well as other terms of the dealer performance program, the dealer is entitled to a specified rebate. For our Pursuit models, if a dealer meets its quarterly or annual volume goals, the dealer is entitled to a specific rebate applied to their wholesale volume purchased from Pursuit. For Malibu and Cobalt models and select Saltwater Fishing models, our dealers that take delivery of current model year boats in the offseason, typically July through April in the U.S., are also entitled to have us pay the interest to floor the boat until the earlier of (1) the sale of the unit or (2) a date near the end of the current model year, which incentive we refer to as “free flooring.” From time to time, we may extend the flooring program to eligible models beyond the offseason period.

Cost of Sales

Our cost of sales includes all of the costs to manufacture our products, including raw materials, components, supplies, direct labor and factory overhead. For components and accessories manufactured by third-party vendors, such costs represent the amounts invoiced by the vendors. Shipping costs and depreciation expense related to manufacturing equipment and facilities are also included in cost of sales. Warranty costs associated with the repair or replacement of our boats under warranty are also included in cost of sales.

Operating Expenses

Our operating expenses include selling and marketing, and general and administrative costs. Each of these items includes personnel and related expenses, supplies, non-manufacturing overhead, third-party professional fees and various other operating expenses. Further, selling and marketing expenditures include the cost of advertising and various promotional sales incentive programs. General and administrative expenses include, among other things, salaries, benefits and other personnel related expenses for employees engaged in product development, engineering, finance, information technology, human resources and executive management. Other costs include outside legal and accounting fees, investor relations, risk management (insurance) and other administrative costs.

Other Expense, Net

Other expense, net consists of interest expense and other income or expense, net. Interest expense consists of interest charged under our outstanding debt, interest on our interest rate swap arrangement and change in the fair value of our interest rate swap we entered into on July 1, 2015, which matured on March 31, 2020, and amortization of deferred financing costs on our credit facilities.

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Income Taxes

Malibu Boats, Inc. is subject to U.S. federal and state income tax in multiple jurisdictions with respect to our allocable share of any net taxable income of the LLC. The LLC is a pass-through entity for federal purposes but incurs income tax in certain state jurisdictions.

Net Income Attributable to Non-controlling Interest

As of December 31, 2020 and 2019, we had a 96.8% and 96.1% controlling economic interest, respectively, and 100% voting interest in the LLC and, therefore, we consolidate the LLC's operating results for financial statement purposes. Net income attributable to non-controlling interest represents the portion of net income attributable to the non-controlling LLC members.

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Results of Operations

The table below sets forth our unaudited interim consolidated results of operations, expressed in thousands (except unit volume and net sales per unit) and as a percentage of net sales, for the periods presented. Our unaudited interim consolidated financial results for these periods are not necessarily indicative of the consolidated financial results that we will achieve in future periods. Certain totals for the table below will not sum to exactly 100% due to rounding.

	Three Months Ended December 31,								Six Months Ended December 31,
	2020				2019				2020				2019
	$		% Revenue		$		% Revenue		$		% Revenue		$		% Revenue
Net sales	195,647		100.0	%	180,112		100.0	%	376,631		100.0	%	352,192		100.0	%
Cost of sales	146,158		74.7		140,244		77.9		281,401		74.7		272,323		77.3
Gross profit	49,489		25.3		39,868		22.1		95,230		25.3		79,869		22.7
Operating expenses:
Selling and marketing	4,001		2.0		4,666		2.6		7,613		2.0		9,732		2.8
General and administrative	15,036		7.7		10,078		5.6		26,690		7.1		20,746		5.9
Amortization	1,524		0.8		1,537		0.9		3,048		0.8		3,121		0.9
Operating income	28,928		14.8		23,587		13.0		57,879		15.4		46,270		13.1
Other (income) expense, net:
Other income, net	(12)		—		(9)		—		(22)		—		(19)		—
Interest expense	445		0.2		957		0.5		1,001		0.3		2,124		0.6
Other expense, net	433		0.2		948		0.5		979		0.3		2,105		0.6
Income before provision for income taxes	28,495		14.6		22,639		12.5		56,900		15.1		44,165		12.5
Provision for income taxes	6,348		3.2		5,041		2.8		12,715		3.4		9,885		2.8
Net income	22,147		11.4		17,598		9.7		44,185		11.7		34,280		9.7
Net income attributable to non-controlling interest	922		0.5		876		0.5		1,867		0.5		1,699		0.5
Net income attributable to Malibu Boats, Inc.	21,225		10.9	%	16,722		9.2	%	42,318		11.2	%	32,581		9.2	%
	Three Months Ended December 31,								Six Months Ended December 31,
	2020				2019				2020				2019
	Unit Volumes		% Total		Unit Volumes		% Total		Unit Volumes		% Total		Unit Volumes		% Total
Volume by Segment
Malibu	1,101		63.2	%	1,101		61.0	%	2,132		63.1	%	2,115		59.9	%
Cobalt	489		28.1		561		31.1		947		28.1		1,131		32.0
Saltwater Fishing	152		8.7		142		7.9		298		8.8		285		8.1
Total units	1,742		100	%	1,804		100	%	3,377		100	%	3,531		100	%
Net sales per unit	$	112,312			$	99,840			$	111,528			$	99,743

Comparison of the Three Months Ended December 31, 2020 to the Three Months Ended December 31, 2019

Net Sales

Net sales for the three months ended December 31, 2020 increased $15.5 million, or 8.6%, to $195.6 million as compared to the three months ended December 31, 2019. The increase in net sales was driven primarily by a favorable model mix in our Malibu segment and increased unit volumes in our Saltwater Fishing segment. Our acquisition of Maverick Boat Group closed on the last day of the quarter and therefore did not impact our net sales for the three months ended December 31, 2020. Unit

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volume for the three months ended December 31, 2020, decreased 62 units, or 3.4%, to 1,742 units as compared to the three months ended December 31, 2019. Our unit volume decreased primarily due to continued lower production levels in our Cobalt segment.

Net sales attributable to our Malibu segment increased $11.3 million, or 11.6%, to $108.6 million for the three months ended December 31, 2020, compared to the three months ended December 31, 2019. Unit volumes attributable to our Malibu segment remained flat for the three months ended December 31, 2020, compared to the three months ended December 31, 2019. The increase in net sales was driven primarily by strong demand for our new, larger models and optional features.

Net sales attributable to our Cobalt segment decreased $1.5 million, or 3.1%, to $47.4 million for the three months ended December 31, 2020, compared to the three months ended December 31, 2019. Unit volumes attributable to Cobalt decreased 72 units for the three months ended December 31, 2020 compared to the three months ended December 31, 2019. Our unit volumes, and as a result our net sales, for our Cobalt segment decreased during the three months ended December 31, 2020 driven by our lower production levels for our Cobalt segment. The planned lower production rates were driven by our investment in the plant to optimize efficiency and expand capacity, the introduction of two new Cobalt models during the quarter, and challenges around labor and supply as a result of the pandemic. While we are ahead of our planned production levels, we do not expect unit volume in this segment will result in year-over-year gains until the second half of this fiscal year. The decrease in our unit volumes for Cobalt was partially offset by a favorable product mix of our Cobalt models impacting our net sales per unit.

Net sales attributable to our Saltwater Fishing segment increased $5.7 million, or 17.0%, to $39.6 million, for the three months ended December 31, 2020, compared to the three months ended December 31, 2019. The increase was driven primarily by sales of larger, more expensive models and unit volumes which increased ten units for the three months ended December 31, 2020 compared to the three months ended December 31, 2019.

Overall consolidated net sales per unit increased 12.5% to $112,312 per unit for the three months ended December 31, 2020, compared to the three months ended December 31, 2019. Net sales per unit for our Malibu segment increased 11.6% to $98,653 per unit for the three months ended December 31, 2020, compared to the three months ended December 31, 2019, driven by higher sales of new, more expensive models and optional features. Net sales per unit for our Cobalt segment increased 11.2% to $97,092 per unit for the three months ended December 31, 2020, compared to the three months ended December 31, 2019, driven by higher sales of larger, more expensive models. Net sales per unit for our Saltwater Fishing segment increased 9.3% to $260,211 per unit for the three months ended December 31, 2020 driven primarily by sales of larger, more expensive models.

Cost of Sales

Cost of sales for the three months ended December 31, 2020 increased $5.9 million, or 4.2%, to $146.2 million as compared to the three months ended December 31, 2019. The increase in cost of sales was driven by higher costs related to higher net sales in our Malibu and Saltwater Fishing segments. In the Malibu segment, higher per unit material and labor costs contributed $4.5 million to the increase in cost of sales and were driven by an increased mix of larger product that corresponded with higher per unit revenue. Within our Saltwater Fishing segment, higher volumes drove $2.0 million of increase in cost of sales which was also modestly impacted by higher per unit costs. Both the Malibu and Saltwater Fishing segment cost of sales increases were partially offset by a decrease in cost of sales at Cobalt that was driven by decreased volume, but offset by per unit cost of sales increases driven by a mix of larger, more expensive product.

Gross Profit

Gross profit for the three months ended December 31, 2020 increased $9.6 million, or 24.1%, to $49.5 million compared to the three months ended December 31, 2019. The increase in gross profit was driven primarily by higher sales revenue with a more favorable product mix partially offset by the increased cost of sales for the reasons noted above. Gross margin for the three months ended December 31, 2020 increased 320 basis points from 22.1% to 25.3%.

Operating Expenses

Selling and marketing expenses for the three months ended December 31, 2020 decreased $0.7 million, or 14.3% to $4.0 million compared to the three months ended December 31, 2019 primarily driven by decreased travel and promotional events due mostly to restrictions imposed by COVID-19. As a percentage of sales, selling and marketing expenses decreased 60 basis points compared to the same period in the prior fiscal year. General and administrative expenses for the three months ended December 31, 2020, increased $5.0 million, or 49.2%, to $15.0 million as compared to the three months ended December 31, 2019 driven primarily by acquisition related costs and higher legal expenses related to intellectual property litigation. As a percentage of sales, general and administrative expenses increased 210 basis points to 7.7% for the three months ended

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December 31, 2020 compared to the three months ended December 31, 2019. Amortization expense for the three months ended December 31, 2020 remained flat at $1.5 million compared to the three months ended December 31, 2019.

Other Expense, Net

Other expense, net for the three months ended December 31, 2020 decreased by $0.5 million, or 54.3% to expense of $0.4 million, compared to the three months ended December 31, 2019 primarily due to decreased interest expense. Interest expense decreased due to a lower interest rate and lower average outstanding debt during the three months ended December 31, 2020 compared to the three months ended December 31, 2019.

Provision for Income Taxes

Our provision for income taxes for the three months ended December 31, 2020, increased $1.3 million, or 25.9%, to $6.3 million compared to the three months ended December 31, 2019. The increase primarily resulted from increased pre-tax earnings. Our effective tax rate for both the three months ended December 31, 2020 and 2019, was 22.3% and exceeded the statutory federal income tax rate of 21% primarily due to the impact of U.S. state taxes. This increase in tax rate was partially offset by a windfall benefit generated by certain stock based compensation, the benefits of the foreign derived intangible income deduction, the research and development tax credit, and the impact of non-controlling interests in the LLC.

Non-controlling Interest

Non-controlling interest represents the ownership interests of the members of the LLC other than us and the amount recorded as non-controlling interest in our unaudited interim condensed consolidated statements of operations and comprehensive income is computed by multiplying pre-tax income for the applicable period, by the percentage ownership in the LLC not directly attributable to us. For the three months ended December 31, 2020 and 2019, the weighted average non-controlling interest attributable to ownership interests in the LLC not directly attributable to us was 3.3% and 3.9%, respectively.

Comparison of the Six Months Ended December 31, 2020 to the Six Months Ended December 31, 2019

Net Sales

Net sales for the six months ended December 31, 2020 increased $24.4 million, or 6.9%, to $376.6 million as compared to the six months ended December 31, 2019. The increase in net sales was driven primarily by a favorable model mix in our Malibu segment and increased unit volumes in our Malibu and Saltwater Fishing segments. Our acquisition of Maverick Boat Group closed on the last day of the quarter and therefore did not impact our net sales for the six months ended December 31, 2020. Unit volume for the six months ended December 31, 2020, decreased 154 units, or 4.4%, to 3,377 units as compared to the six months ended December 31, 2019. Our unit volume decreased primarily due to continued lower production levels in our Cobalt segment.

Net sales attributable to our Malibu segment increased $25.2 million, or 13.8%, to $208.4 million for the six months ended December 31, 2020, compared to the six months ended December 31, 2019. Unit volumes attributable to our Malibu segment increased 17 units for the six months ended December 31, 2020, compared to the six months ended December 31, 2019. The increase in net sales and unit volumes was driven primarily by strong demand for our new, larger models and optional features.

Net sales attributable to our Cobalt segment decreased $7.2 million, or 7.2%, to $92.0 million for the six months ended December 31, 2020, compared to the six months ended December 31, 2019. Unit volumes attributable to Cobalt decreased 184 units for the six months ended December 31, 2020 compared to the six months ended December 31, 2019. Our unit volumes, and as a result our net sales, for our Cobalt segment decreased during the six months ended December 31, 2020 driven by our lower production levels for our Cobalt segment at the end of fiscal year 2020. The planned lower production rates were driven by our investment in the plant to optimize efficiency and expand capacity, the introduction of five new Cobalt models during the six months ended December 31, 2020 and challenges around labor and supply as a result of the pandemic. While we are ahead of our planned production levels, we do not expect unit volume in this segment will result in year-over-year gains until the second half of this fiscal year. The decrease in our unit volumes for Cobalt was partially offset by a favorable product mix of our Cobalt models impacting our net sales per unit.

Net sales attributable to our Saltwater Fishing segment increased $6.4 million, or 9.1%, to $76.2 million, for the six months ended December 31, 2020, compared to the six months ended December 31, 2019. The increase was driven primarily by increase in sales of larger, more expensive models and unit volumes which increased 13 units for the six months ended December 31, 2020 compared to the six months ended December 31, 2019.

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Overall consolidated net sales per unit increased 11.8% to $111,528 per unit for the six months ended December 31, 2020, compared to the six months ended December 31, 2019. Net sales per unit for our Malibu segment increased 12.9% to $97,771 per unit for the six months ended December 31, 2020, compared to the six months ended December 31, 2019, driven by higher sales of new, more expensive models and optional features. Net sales per unit for our Cobalt segment increased 10.8% to $97,107 per unit for the six months ended December 31, 2020, compared to the six months ended December 31, 2019, driven by higher sales of larger, more expensive models. Net sales per unit for our Saltwater Fishing segment increased 4.4% to $255,782 per unit for the six months ended December 31, 2020 driven by sales of larger, more expensive models.

Cost of Sales

Cost of sales for the six months ended December 31, 2020 increased $9.1 million, or 3.3%, to $281.4 million as compared to the six months ended December 31, 2019. The increase in cost of sales was driven primarily by higher costs related to higher net sales in our Malibu segment. In the Malibu segment, higher per unit material and labor costs contributed $11.3 million to the increase in cost of sales and were driven by an increased mix of larger product that corresponded with higher per unit revenue. Within the Saltwater Fishing segment, higher volumes contributed to an increase in cost of sales. Both the Malibu and Saltwater Fishing segment cost of sales increases were partially offset by a decrease in cost of sales at Cobalt that was driven by decreased volume, but offset by per unit cost of sales increases driven by a mix of larger, more expensive product.

Gross Profit

Gross profit for the six months ended December 31, 2020 increased $15.4 million, or 19.2%, to $95.2 million compared to the six months ended December 31, 2019. The increase in gross profit was driven primarily by higher sales revenue with a more favorable product mix partially offset by the increased cost of sales for the reasons noted above. Gross margin for the six months ended December 31, 2020 increased 260 basis points from 22.7% to 25.3%.

Operating Expenses

Selling and marketing expenses for the six months ended December 31, 2020, decreased $2.1 million, or 21.8% to $7.6 million compared to the six months ended December 31, 2019 primarily driven by decreased travel and promotional events due mostly to restrictions imposed by COVID-19. As a percentage of sales, selling and marketing expenses decreased 80 basis points compared to the same period in the prior fiscal year. General and administrative expenses for the six months ended December 31, 2020, increased $5.9 million, or 28.7%, to $26.7 million as compared to the six months ended December 31, 2019 driven primarily by acquisition related costs and higher legal expenses related to intellectual property litigation. As a percentage of sales, general and administrative expenses increased 120 basis points to 7.1% for the six months ended December 31, 2020 compared to the six months ended December 31, 2019. Amortization expense for the six months ended December 31, 2020 decreased $0.1 million, or 2.3% to $3.0 million compared to the six months ended December 31, 2019.

Other Expense, Net

Other expense, net for the six months ended December 31, 2020 decreased by $1.1 million, or 53.5% to expense of $1.0 million, compared to the six months ended December 31, 2019 primarily due to decreased interest expense. Interest expense decreased due to a lower interest rate and lower average outstanding debt during the six months ended December 31, 2020 compared to the six months ended December 31, 2019.

Provision for Income Taxes

Our provision for income taxes for the six months ended December 31, 2020, increased $2.8 million, or 28.6%, to $12.7 million compared to the six months ended December 31, 2019. The increase primarily resulted from increased pre-tax earnings. For the six months ended December 31, 2020 and 2019, our effective tax rate of 22.3% and 22.4%, respectively, exceeded the statutory federal income tax rate of 21% primarily due to the impact of U.S. state taxes. This increase in tax rate was partially offset by the benefits of the foreign derived intangible income deduction, the research and development tax credit, and the impact of non-controlling interests in the LLC.

Non-controlling Interest

Non-controlling interest represents the ownership interests of the members of the LLC other than us and the amount recorded as non-controlling interest in our unaudited interim condensed consolidated statements of operations and comprehensive income is computed by multiplying pre-tax income for the applicable period, by the percentage ownership in the LLC not directly attributable to us. For the six months ended December 31, 2020 and 2019, the weighted average non-controlling interest attributable to ownership interests in the LLC not directly attributable to us was 3.3% and 3.9%, respectively.

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GAAP Reconciliation of Non-GAAP Financial Measures

Adjusted EBITDA

Adjusted EBITDA and adjusted EBITDA margin are non-GAAP financial measures that are used by management as well as by investors, commercial bankers, industry analysts and other users of our financial statements.

We define adjusted EBITDA as net income before interest expense, income taxes, depreciation, amortization and non-cash, non-recurring or non-operating expenses, including certain professional fees, acquisition and integration-related expenses, non-cash compensation expense and expenses related to interruption to our engine supply during the labor strike by United Auto Workers ("UAW") against General Motors. We define adjusted EBITDA margin as adjusted EBITDA divided by net sales. Adjusted EBITDA and adjusted EBITDA margin are not measures of net income as determined by GAAP. Management believes adjusted EBITDA and adjusted EBITDA margin allow investors to evaluate the company’s operating performance and compare our results of operations from period to period on a consistent basis by excluding items that management does not believe are indicative of our core operating performance. Management uses Adjusted EBITDA to assist in highlighting trends in our operating results without regard to our financing methods, capital structure and non-recurring or non-operating expenses. We exclude the items listed above from net income in arriving at adjusted EBITDA because these amounts can vary substantially from company to company within our industry depending upon accounting methods and book values of assets, capital structures, the methods by which assets were acquired and other factors. Adjusted EBITDA has limitations as an analytical tool and should not be considered as an alternative to, or more meaningful than, net income as determined in accordance with GAAP or as an indicator of our liquidity. Certain items excluded from adjusted EBITDA are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historical costs of depreciable assets. Our presentation of adjusted EBITDA and adjusted EBITDA margin should not be construed as an inference that our results will be unaffected by unusual or non-recurring items. Our computations of adjusted EBITDA and adjusted EBITDA margin may not be comparable to other similarly titled measures of other companies.

The following table sets forth a reconciliation of net income as determined in accordance with GAAP to adjusted EBITDA and adjusted EBITDA margin for the periods indicated (dollars in thousands):

	Three Months Ended December 31,						Six Months Ended December 31,
	2020			2019			2020			2019
Net income	$	22,147		$	17,598		$	44,185		$	34,280
Provision for income taxes	6,348			5,041			12,715			9,885
Interest expense	445			957			1,001			2,124
Depreciation	3,599			3,005			7,085			6,102
Amortization	1,524			1,537			3,048			3,121
Professional fees 1	673			41			2,238			376
Acquisition and integration related expenses 2	2,577			—			2,577			—
Stock-based compensation expense 3	1,800			813			2,611			1,490
UAW strike impact 4	—			1,687			—			1,687
Adjusted EBITDA	$	39,113		$	30,679		$	75,460		$	59,065
Adjusted EBITDA Margin	20.0		%	17.0		%	20.0		%	16.8		%

(1)	Represents legal and advisory fees related to our litigation with Skier's Choice, Inc. See Note 16 to our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.
(2)	For the three months and six months ended December 31, 2020, represents legal and advisory fees incurred in connection with our acquisition of Maverick Boat Group on December 31, 2020.
(3)	Represents equity-based incentives awarded to key employees under the Malibu Boats, Inc. Long-Term Incentive Plan and profit interests issued under the previously existing limited liability company agreement of the LLC. For more information, see Note 14 to our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.
(4)	For the three and six months ended December 31, 2019, represents costs incurred in connection with interruption to our engine supply during the UAW strike against General Motors. We purchase engines from General Motors LLC that we then prepare for marine use for our Malibu and Axis boats. During the UAW strike, General Motors suspended delivery of engine blocks to us and we incurred costs by entering into purchase agreements with two suppliers for additional engines to supplement our inventory of engine blocks for Malibu and Axis boats.

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Adjusted Fully Distributed Net Income

We define Adjusted Fully Distributed Net Income as net income attributable to Malibu Boats, Inc. (i) excluding income tax expense, (ii) excluding the effect of non-recurring or non-cash items, (iii) assuming the exchange of all LLC units into shares of Class A Common Stock, which results in the elimination of non-controlling interest in the LLC, and (iv) reflecting an adjustment for income tax expense on fully distributed net income before income taxes at our estimated effective income tax rate. Adjusted Fully Distributed Net Income is a non-GAAP financial measure because it represents net income attributable to Malibu Boats, Inc., before non-recurring or non-cash items and the effects of non-controlling interests in the LLC.

We use Adjusted Fully Distributed Net Income to facilitate a comparison of our operating performance on a consistent basis from period to period that, when viewed in combination with our results prepared in accordance with GAAP, provides a more complete understanding of factors and trends affecting our business than GAAP measures alone.

We believe Adjusted Fully Distributed Net Income assists our board of directors, management and investors in comparing our net income on a consistent basis from period to period because it removes non-cash or non-recurring items, and eliminates the variability of non-controlling interest as a result of member owner exchanges of LLC Units into shares of Class A Common Stock.

In addition, because Adjusted Fully Distributed Net Income is susceptible to varying calculations, the Adjusted Fully Distributed Net Income measures, as presented in this Quarterly Report, may differ from and may, therefore, not be comparable to similarly titled measures used by other companies.

The following table shows the reconciliation of the numerator and denominator for net income available to Class A Common Stock per share to Adjusted Fully Distributed Net Income per Share of Class A Common Stock for the periods presented (in thousands except share and per share data):

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Reconciliation of numerator for net income available to Class A Common Stock per share to Adjusted Fully Distributed Net Income per Share of Class A Common Stock:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Provision for income taxes	6,348		5,041		12,715		9,885
Professional fees 1	673		41		2,238		376
Acquisition and integration related expenses 2	3,651		1,074		4,724		2,147
Fair market value adjustment for interest rate swap 3	—		20		—		58
Stock-based compensation expense 4	1,800		813		2,611		1,490
UAW strike impact 5	—		1,687		—		1,687
Net income attributable to non-controlling interest 6	922		876		1,867		1,699
Fully distributed net income before income taxes	34,619		26,274		66,473		49,923
Income tax expense on fully distributed income before income taxes 7	8,170		6,174		15,688		11,732
Adjusted fully distributed net income	$	26,449	$	20,100	$	50,785	$	38,191

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	Three Months Ended December 31,		Six Months Ended December 31,
	2020	2019	2020	2019
Reconciliation of denominator for net income available to Class A Common Stock per share to Adjusted Fully Distributed Net Income per Share of Class A Common Stock:
Weighted average shares outstanding of Class A Common Stock used for basic net income per share:	20,717,359	20,591,241	20,684,644	20,710,681
Adjustments to weighted average shares of Class A Common Stock:
Weighted-average LLC units held by non-controlling unit holders 8	700,732	830,152	707,497	830,152
Weighted-average unvested restricted stock awards issued to management 9	209,544	133,185	194,296	129,850
Adjusted weighted average shares of Class A Common Stock outstanding used in computing Adjusted Fully Distributed Net Income per Share of Class A Common Stock:	21,627,635	21,554,578	21,586,437	21,670,683

The following table shows the reconciliation of net income available to Class A Common Stock per share to Adjusted Fully Distributed Net Income per Share of Class A Common Stock for the periods presented:

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Net income available to Class A Common Stock per share	$	1.03	$	0.81	$	2.05	$	1.57
Impact of adjustments:
Provision for income taxes	0.30		0.25		0.61		0.48
Professional fees 1	0.03		—		0.11		0.02
Acquisition and integration related expenses 2	0.18		0.05		0.23		0.10
Fair market value adjustment for interest rate swap 3	—		—		—		—
Stock-based compensation expense 4	0.09		0.04		0.13		0.07
UAW strike impact 5	—		0.08		—		0.08
Net income attributable to non-controlling interest 6	0.04		0.04		0.09		0.08
Fully distributed net income per share before income taxes	1.67		1.27		3.22		2.40
Impact of income tax expense on fully distributed income before income taxes 7	(0.39)		(0.30)		(0.75)		(0.57)
Impact of increased share count 10	(0.06)		(0.04)		(0.12)		(0.07)
Adjusted Fully Distributed Net Income per Share of Class A Common Stock	$	1.22	$	0.93	$	2.35	$	1.76

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(1)	Represents legal and advisory fees related to our litigation with Skier's Choice, Inc. See Note 16 to our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.
(2)	For the three and six months ended December 31, 2020, represents legal and advisory fees incurred in connection with the acquisition of Maverick Boat Group and amortization of intangibles acquired in connection with the acquisition of Pursuit and Cobalt. For the three and six months ended December 31, 2019, represents amortization of intangibles acquired in connection with the acquisition of Pursuit and Cobalt.
(3)	Represents the change in the fair value of our interest rate swap entered into on July 1, 2015. The swap matured on March 31, 2020.
(4)	Represents equity-based incentives awarded to certain of our employees under the Malibu Boats, Inc. Long-Term Incentive Plan and profit interests issued under the previously existing limited liability company agreement of the LLC. See Note 14 to our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.
(5)	For the three and six months ended December 31, 2019, represents costs incurred in connection with interruption to our engine supply during the UAW strike against General Motors. We purchase engines from General Motors LLC that we then prepare for marine use for our Malibu and Axis boats. During the UAW strike, General Motors suspended delivery of engine blocks to us and we incurred costs by entering into purchase agreements with two suppliers for additional engines to supplement our inventory of engine blocks for Malibu and Axis boats.
(6)	Reflects the elimination of the non-controlling interest in the LLC as if all LLC members had fully exchanged their LLC Units for shares of Class A Common Stock.
(7)	Reflects income tax expense at an estimated normalized annual effective income tax rate of 23.6% and 23.5% of income before income taxes for the three and six month periods ended December 31, 2020 and 2019, respectively, assuming the conversion of all LLC Units into shares of Class A Common Stock. The estimated normalized annual effective income tax rate for fiscal year 2021 is based on the federal statutory rate plus a blended state rate adjusted for the research and development tax credit, the foreign derived intangible income deduction, and foreign income taxes attributable to our Australian subsidiary.
(8)	Represents the weighted average shares outstanding of LLC Units held by non-controlling interests assuming they were exchanged into Class A Common Stock on a one-for-one basis.
(9)	Represents the weighted average unvested restricted stock awards included in outstanding shares during the applicable period that were convertible into Class A Common Stock and granted to members of management.
(10)	Reflects impact of increased share counts assuming the exchange of all weighted average shares outstanding of LLC Units into shares of Class A Common Stock and the conversion of all weighted average unvested restricted stock awards included in outstanding shares granted to members of management.

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Liquidity and Capital Resources

Our primary sources of funds are cash provided by operating activities and borrowings under our credit agreement. Our primary use of funds has been for capital investments, repayments under our debt arrangements, acquisitions, cash distributions

to members of the LLC and cash payments under our tax receivable agreement. The following table summarizes the cash flows from operating, investing and financing activities (dollars in thousands):

	Six Months Ended December 31,
	2020		2019
Total cash (used in) provided by:
Operating activities	$	72,601	$	52,509
Investing activities	(161,952)		(19,313)
Financing activities	79,138		(32,903)
Impact of currency exchange rates on cash balances	155		22
(Decrease) Increase in cash	$	(10,058)	$	315

Comparison of the Six Months Ended December 31, 2020 to the Six Months Ended December 31, 2019

Operating Activities

Net cash provided by operating activities was $72.6 million for the six months ended December 31, 2020, compared to $52.5 million for the six months ended December 31, 2019, an increase of $20.1 million. The increase in cash provided by operating activities primarily resulted from an increase of $11.7 million due to an increase in net income (after consideration of non-cash items included in net income, primarily related to depreciation, amortization, deferred tax assets and non-cash compensation) and a net increase in operating assets and liabilities of $8.4 million related to the timing of collections of accounts receivables, payments for accruals and payables, and purchases of inventory.

Investing Activities

Net cash used in investing activities was $162.0 million for the six months ended December 31, 2020, compared to $19.3 million for the six months ended December 31, 2019, an increase of $142.7 million. The increase in cash used for investing activities was primarily related to the acquisition of Maverick Boat Group on December 31, 2020 offset by a reduction in capital expenditures compared to the capital outlays for our expansion activities at our Pursuit and Cobalt plants in the six months ended December 31, 2019.

Financing Activities

Net cash provided by financing activities was $79.1 million for the six months ended December 31, 2020, compared to net cash used in financing activities of $32.9 million for the six months ended December 31, 2019, a change of $112.0 million. During the six months ended December 31, 2020, we received proceeds of $25.0 million from a new incremental term loan and $65.0 million from additional borrowings under our revolving credit facility to fund the acquisition of Maverick Boat Group. During the six months ended December 31, 2020, we also repaid $8.8 million of borrowings under our revolving credit facility, paid $1.2 million on taxes for shares withheld upon the vesting of restricted stock awards, paid $0.6 million in deferred financing costs, paid $0.1 million in distributions to LLC unit holders and received $0.3 million in proceeds from the exercise of stock options. During the six months ended December 31, 2019, we repurchased $11.1 million of our Class A Common Stock. We also repaid $20.0 million of borrowings under our revolving credit facility, paid $1.0 million in distributions to LLC unit holders and paid $0.8 million on taxes for shares withheld on upon the vesting of restricted stock awards.

Loans and Commitments

We amended our existing credit agreement on December 30, 2020 in connection with our acquisition of Maverick Boat Group. As a result of that amendment, we currently have a revolving credit facility with borrowing capacity of up to $170.0 million and $100.0 million aggregate principal amount of term loans outstanding. As of December 31, 2020, we had $65.0 million outstanding under our revolving credit facility and $1.2 million in outstanding letters of credit, with $103.8 million available for borrowing. Our revolving credit facility matures on July 1, 2024, the incremental term loan made on December 30, 2020 in a principal amount of $25.0 million (which we refer to as the incremental term loan) matures on July 1, 2024 and the remaining $75.0 million of term loans (which we refer to as the existing term loans, and together with the incremental term loan, the term loans) mature on July 1, 2022. The revolving credit facility and term loans are governed by a credit agreement with Boats LLC as the borrower and Truist Bank, as the administrative agent, swingline lender and issuing bank. The obligations of Boats LLC under the credit agreement are guaranteed by the LLC and, subject to certain exceptions, the present

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and future domestic subsidiaries of Boats LLC, and all such obligations are secured by substantially all of the assets of the LLC, Boats LLC and such subsidiary guarantors. Malibu Boats, Inc. is not a party to the credit agreement.

Borrowings under our credit agreement bear interest at a rate equal to either, at our option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.5%, or one-month LIBOR plus 1% (the “Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 1.25% to 2.25% with respect to LIBOR borrowings and 0.25% to 1.25% with respect to Base Rate borrowings. The applicable margin will be based upon the consolidated leverage ratio of the LLC and its subsidiaries calculated on a consolidated basis. As of December 31, 2020, the interest rate on our term loans and revolving credit facility was 1.39%. We are required to pay a commitment fee for the unused portion of the revolving credit facility, which will range from 0.20% to 0.40% per annum, depending on the LLC’s and its subsidiaries’ consolidated leverage ratio.

The credit agreement permits prepayment of the term loans without any penalties. The existing term loans require an amortization payment of approximately $3.0 million on March 31, 2022 and the balance of the existing term loans are due on the scheduled maturity date of July 1, 2022. The incremental term loan of $25.0 million is subject to quarterly amortization at a rate of 5.0% per year through December 31, 2022, 7.5% per year through June 30, 2024 and the balance of the incremental term loan is due on the scheduled maturity date of July 1, 2024. The credit agreement also requires prepayments from the net cash proceeds received by Boats LLC or any guarantors from certain asset sales and recovery events, subject to certain reinvestment rights, and from excess cash flow, subject to the terms and conditions of the credit agreement.

The credit agreement contains certain customary representations and warranties, and notice requirements for the occurrence of specific events such as the occurrence of any event of default, or pending or threatened litigation. The credit agreement also requires compliance with certain customary financial covenants, including a minimum ratio of EBITDA to fixed charges and a maximum ratio of total debt to EBITDA. The credit agreement contains certain restrictive covenants, which, among other things, place limits on certain activities of the loan parties under the credit agreement, such as the incurrence of additional indebtedness and additional liens on property and limit the future payment of dividends or distributions. For example, the credit agreement generally prohibits the LLC, Boats LLC and the subsidiary guarantors from paying dividends or making distributions, including to us. The credit facility permits, however, (i) distributions based on a member’s allocated taxable income, (ii) distributions to fund payments that are required under the LLC’s tax receivable agreement, (iii) purchase of stock or stock options of the LLC from former officers, directors or employees of loan parties or payments pursuant to stock option and other benefit plans up to $3.0 million in any fiscal year, and (iv) share repurchase payments up to $35.0 million in any fiscal year subject to one-year carry forward and compliance with other financial covenants. In addition, the LLC may make dividends and distributions of up to $10.0 million in any fiscal year, subject to compliance with other financial covenants.

Potential Impact of LIBOR Transition

The Chief Executive of the U.K. Financial Conduct Authority (the “FCA”), which regulates the London Interbank Offered Rate, or LIBOR, has announced that the FCA will no longer persuade or compel banks to submit rates for the calculation of LIBOR after 2021. However, for U.S dollar LIBOR, it now appears that the relevant date may be deferred to June 30, 2023 for certain tenors (including overnight and one, three, six and 12 months), at which time the LIBOR administrator has indicated that it intends to cease publication of U.S. dollar LIBOR. Despite this potential deferral, the LIBOR administrator has advised that no new contracts using U.S. dollar LIBOR should be entered into after December 31, 2021. These actions indicate that the continuation of U.S. LIBOR on the current basis cannot and will not be guaranteed after June 30, 2023. Moreover, it is possible that U.S. LIBOR will be discontinued or modified prior to June 30, 2023.

All of our $165.0 million of debt outstanding under our credit agreement as of December 31, 2020 bears interest at a floating rate that uses LIBOR as the applicable reference rate to calculate the interest. Our credit agreement provides that, if it is publicly announced that the administrator of LIBOR has ceased or will cease to provide LIBOR, if it is publicly announced by the applicable regulatory supervisor that LIBOR is no longer representative or if either the administrative agent or lenders holding 50% of the aggregate principal amount of our revolving commitments and term loans elect, we and the administrative agent may amend our credit agreement to replace LIBOR with an alternate benchmark rate. This alternative benchmark rate may include a forward-looking term rate that is based on the secured overnight financing rate, also known as SOFR, published by the Federal Reserve Bank of New York.

In addition, our tax receivable agreement provides that, if for any reason the LLC is not able to make a tax distribution in an amount that is sufficient to make any required payment under the tax receivable agreement or we otherwise lack sufficient funds, interest would accrue on any unpaid amounts at LIBOR plus 500 basis points until they are paid. Our tax receivable agreement, however, does not provide for an alternative reference rate to LIBOR and, while we do not currently anticipate failing to pay any amounts owed under our tax receivable agreement, it is unclear how we would determine interest on any such amounts should we fail to pay as required under our tax receivable agreement.

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If the rate used to calculate interest on our outstanding floating rate debt under our credit agreement that currently uses LIBOR were to increase by 1.0% either as a result of an increase in LIBOR or the result of the use of the alternative benchmark rate, we would expect to incur additional interest expense on such indebtedness as of December 31, 2020 of approximately $1.7 million on an annualized basis. While we do not expect the potential impact of any LIBOR transition to have a material effect on our financial results based on our currently outstanding debt, uncertainty as to the nature of potential changes to LIBOR, fallback provisions, alternative reference rates or other reforms could adversely impact our interest expense on our floating rate debt that currently uses LIBOR as the applicable reference rate. In addition, any alternative reference rates to LIBOR may result in interest that does not correlate over time with the payments that would have been made on our indebtedness if LIBOR was available in its current form. Further, the discontinuance or modification of LIBOR and uncertainty of an alternative reference rate may result in the increase in the cost of future indebtedness, which could have a material adverse effect on our financial condition, cash flow and results of operations. We intend to closely monitor the financial markets and the use of fallback provisions and alternative reference rates in anticipation of the discontinuance or modification of U.S. LIBOR by June 30, 2023.

Future Liquidity Needs and Capital Expenditures

Management believes that our existing cash, borrowing capacity under our revolving credit facility and cash flows from operations will be sufficient to fund our operations for the next 12 months. We estimate that approximately $3.6 million will be due under the tax receivable agreement within the next 12 months. In accordance with the tax receivable agreement, the next payment is anticipated to occur approximately 75 days after filing the federal tax return which is due on April 15, 2021.

Our future capital requirements will depend on many factors, including the general economic environment in which we operate and our ability to generate cash flow from operations, which are more uncertain as a result of the COVID-19 pandemic and its impact on the general economy. Our liquidity needs during this uncertain time will depend on multiple factors, including our ability to continue operations and production of boats, the COVID-19 pandemic’s effects on our dealers, suppliers and retail customers, the availability of sufficient amounts of financing, and our operating performance.

Stock Repurchase Program

On August 27, 2020, our Board of Directors authorized a stock repurchase program to allow for the repurchase of up to $50.0 million of our Class A Common Stock and the LLC's LLC Units (the “Repurchase Program”) for the period from September 2, 2020 to July 1, 2021. We intend to fund repurchases under the Repurchase Program from cash on hand. We did not repurchase any shares of our Class A Common Stock during the three and six months ended December 31, 2020. As of December 31, 2020, we may repurchase up to $50.0 million in shares of Class A Common Stock and LLC Units under the program.

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Contractual Obligations and Commitments

As of December 31, 2020, our continuing contractual obligations were as follows:

	Payments Due by Period
	Total		Less than 1 Year		1-3 Years		3-5 Years		More than 5 Years
Bank debt 1	$	165,000	$	1,250	$	77,656	$	86,094	$	—
Interest expense 2	5,926		2,330		2,992		604		—
Operating leases 3	17,122		2,488		5,001		4,746		4,887
Purchase obligations 4	153,318		153,318		—		—		—
Payments pursuant to tax receivable agreement 5	50,208		3,589		7,597		8,118		30,904
Total	$	391,574	$	162,975	$	93,246	$	99,562	$	35,791

(1)	Principal payments on our outstanding bank debt per terms of our credit agreement, which is comprised of a $100.0 million term loan and $170.0 million revolving credit facility, of which $65.0 million was outstanding as of December 31, 2020. Assumes no additional borrowings or repayments under our revolving credit facility prior to its maturity. The balance of outstanding term loans matures on July 1, 2022, the incremental term loan in a principal amount of $25.0 million matures on July 1, 2024 and the revolving credit facility matures on July 1, 2024.
(2)	Interest payments on our outstanding term loans under our credit agreement. Our term loan bears interest at variable rates. We have calculated future interest obligations based on the interest rate as of December 31, 2020.
(3)	Pursuant to the adoption of ASC Topic 842, Leases, as of July 1, 2019 our lease liability for all leases with terms greater than 12 months as represented on the balance sheet respective of maturity.
(4)	As part of the normal course of business, we enter into purchase orders from a variety of suppliers, primarily for raw materials, in order to manage our various operating needs. The orders are expected to be purchased throughout fiscal year 2021 and 2022.
(5)	Reflects amounts owed under our tax receivables agreement that we entered into with our pre-IPO owners at the time of our IPO. Under the tax receivables agreement, we pay the pre-IPO owners (or any permitted assignees) 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax or franchise tax that we actually realize, or in some circumstances are deemed to realize, as a result of an expected increase in our share of tax basis in LLC’s tangible and intangible assets, including increases attributable to payments made under the tax receivable agreement. These obligations will not be paid if we do not realize cash tax savings.

Off Balance Sheet Arrangements

In connection with our dealers’ wholesale floor plan financing of boats, we have entered into repurchase arrangements with various lending institutions. The repurchase commitment is on an individual unit basis with a term from the date it is financed by the lending institution through payment date by the dealer, generally not exceeding two and a half years. Such arrangements are customary in the industry and our exposure to loss under such arrangements is limited by the resale value of the inventory which is required to be repurchased. Refer to Note 16 of our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report for further information on repurchase commitments.

Seasonality

Our dealers experience seasonality in their business. Retail demand for boats is seasonal, with a significant majority of sales occurring during peak boating season, which coincides with our first and fourth fiscal quarters. In order to minimize the impact of this seasonality on our business, we manage our manufacturing processes and structure dealer incentives to tie our annual volume rebates program to consistent ordering patterns, encouraging dealers to purchase our products throughout the year. In this regard, we may offer free flooring incentives to dealers from the beginning of our model year through April 30 of each year. Further, in the event that a dealer does not consistently order units throughout the year, such dealer’s rebate is materially reduced. We may offer off-season retail promotions to our dealers in seasonally slow months, during and ahead of boat shows, to encourage retail demand.

Critical Accounting Policies

On December 31, 2020, we acquired all of the outstanding stock of Maverick Boat Group and allocated the fair value of purchase consideration to the tangible assets acquired, liabilities assumed and intangible assets acquired based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Our valuation procedures include consultation with an independent adviser. When determining the fair values of assets acquired and liabilities assumed, management makes significant estimates and

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assumptions, especially with respect to intangible assets. Critical estimates in valuing certain intangible assets include but are not limited to projected future cash flows, dealer attrition and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates and changes could be significant. We expect to finalize these amounts during the second half of fiscal 2021.

Other estimates associated with the accounting for acquisitions may change as additional information becomes available regarding the assets acquired and liabilities assumed, as more fully discussed in Note 4 of our unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report.

As of December 31, 2020, there were no other significant changes in the application of our critical accounting policies or estimation procedures from those presented in our Annual Report on Form 10-K for the fiscal year ended June 30, 2020.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Refer to our Annual Report on Form 10-K for the year ended June 30, 2020, for a complete discussion on the Company’s market risk. There have been no material changes in market risk from those disclosed in the Company's Form 10-K for the year ended June 30, 2020.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) of the Exchange Act) that are designed to ensure that information required to be disclosed by us in the reports that 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 our management, including our chief executive officer and chief financial officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

As of the end of the period covered by this Quarterly Report, we carried out an evaluation under the supervision and with the participation of our management, including our chief executive officer and chief financial officer, of the effectiveness of our disclosure controls and procedures. Based upon this evaluation, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of December 31, 2020.

Changes in Internal Control Over Financial Reporting

On December 31, 2020, we acquired all of the outstanding stock of Maverick Boat Group. Prior to the acquisition, Maverick Boat Group was a privately-held company and was not subject to the Sarbanes-Oxley Act of 2002, the rules and regulations of the SEC, or other corporate governance requirements applicable to public reporting companies. As part of our ongoing integration activities, we are continuing to incorporate our controls and procedures into Maverick Boat Group and to augment our company-wide controls to reflect the risks that may be inherent in acquisitions of privately-held companies.

Other than our integration of Maverick Boat Group, there have been no changes in our internal control over financial reporting during the quarter ended December 31, 2020 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

The discussion of legal matters under the section entitled "Legal Proceedings" is incorporated by reference from Note 16 of our unaudited interim condensed consolidated financial statements included elsewhere in this Quarterly Report.

Item 1A. Risk Factors

Other than the risk factors below related to our acquisition of Maverick Boat Group, during the quarter ended December 31, 2020, there were no material changes to the risk factors discussed in Part I, Item 1A. "Risk Factors” of our Annual Report on Form 10-K for the year ended June 30, 2020.

Our results after the acquisition of Maverick Boat Group may suffer if we do not effectively manage our expanded operations following the acquisition.

The size of our business has increased following our acquisition of Maverick Boat Group. Our future success depends, in part, upon our ability to manage this expanded business, which will pose substantial challenges for management, including challenges related to the management and monitoring of additional operations and associated increased costs and complexity. There can be no assurances we will be successful or that we will realize the benefits from our acquisition of Maverick Boat Group.

We have incurred and will continue to incur significant transaction expenses and acquisition-related integration costs in connection with the acquisition of Maverick Boat Group.

We incurred non-recurring, legal and advisory costs in connection with the acquisition of Maverick Boat Group and we anticipate that we will incur integration-related charges in connection with the integration of Maverick Boat Group. These transaction expenses and integration costs are charged as an expense in the period incurred. The significant transaction costs and integration costs could materially affect our results of operations in the period in which such charges are recorded. Although we believe that the elimination of duplicative costs, as well as the realization of other efficiencies related to the integration of the business, will offset incremental transaction and integration costs over time, this net benefit may not be achieved in the near term, or at all.

The Maverick Boat Group business may underperform relative to our expectations.

We will need to integrate the operations of Maverick Boat Group into our business. We may not be able to maintain the levels of revenue, earnings or operating efficiency that we and Maverick Boat Group have achieved or might achieve separately. The business and financial performance of Maverick Boat Group are subject to certain risks and uncertainties, including the risk of the loss of, or changes to, its relationships with its dealers and suppliers, increased product liability and warranty claims, and negative publicity or other events that could diminish the value of the Maverick Boat Group family of brands. We may be unable to achieve the same growth, revenues and profitability that Maverick Boat Group achieved in the past.

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

Unregistered Sales of Equity Securities

On December 15, 2020, in connection with the exchange of limited liability company interests of the LLC by a member of the LLC, the Company issued a total of 11,564 shares of its Class A Common Stock, par value $0.01 per share for nominal consideration to such member in reliance on the exemption under Section 4(a)(2) of the Securities Act.

Repurchase of Class A Common Stock

On August 27, 2020, our Board of Directors authorized a new stock repurchase program for the repurchase of up to $50.0 million of Class A Common Stock and the LLC Units for the period from September 2, 2020 to July 1, 2021. No shares have been repurchased under our New Repurchase Program during the quarter ended December 31, 2020. As of December 31, 2020, we may repurchase up to $50.0 million in shares of Class A Common Stock and LLC Units under the program.

In November 2020, the Company repurchased 1,965 and 4,761 shares of Class A Common Stock at $54.47 and $59.32 per share, respectively, from employees to satisfy tax withholding obligations incurred in connections with the vesting of restricted stock.

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Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Other Information

None.

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Item 6. Exhibits

Exhibit No.	Description
2.1	Stock Purchase Agreement dated December 31, 2020 among Malibu Boats, LLC, MBG Holdco, Inc., Maverick Boat Group, Inc., and the other parties named therein. 6
3.1	Certificate of Incorporation of Malibu Boats, Inc. 1
3.2	Bylaws of Malibu Boats, Inc. 1
3.3	Certificate of Formation of Malibu Boats Holdings, LLC 1
3.4	First Amended and Restated Limited Liability Company Agreement of Malibu Boats Holdings, LLC, dated as of February 5, 2014 2
3.4.1	First Amendment, dated as of February 5, 2014, to First Amended and Restated Limited Liability Company Agreement of Malibu Boats Holdings, LLC 3
3.4.2	Second Amendment, dated as of June 27, 2014, to First Amended and Restated Limited Liability Company Agreement of Malibu Boats Holdings, LLC 4
4.1	Description of Class A Common Stock 5
4.2	Form of Class A Common Stock Certificate 1
4.3	Form of Class B Common Stock Certificate 1
4.4	Exchange Agreement, dated as of February 5, 2014, by and among Malibu Boats, Inc. and Affiliates of Black Canyon Capital LLC and Horizon Holdings, LLC 2
4.5	Exchange Agreement, dated as of February 5, 2014, by and among Malibu Boats, Inc. and the Members of Malibu Boats Holdings, LLC 2
4.6	Tax Receivable Agreement, dated as of February 5, 2014, by and among Malibu Boats, Inc., Malibu Boats Holdings, LLC and the Other Members of Malibu Boats Holdings, LLC 2
10.1	Third Incremental Facility Amendment and Third Amendment dated as of December 30, 2020 to the Credit Agreement by and among Malibu Boats, LLC, Malibu Boats Holdings, LLC, the other guarantors party thereto, the lenders party thereto and Truist Bank (successor by merger to SunTrust Bank), as administrative agent, swingline lender and issuing bank. 6
31.1	Certificate of the Chief Executive Officer of Malibu Boats, Inc. pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certificate of the Chief Financial Officer of Malibu Boats, Inc. pursuant to Rule 13a-14 or 15d-14 of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification of the Chief Executive Officer and Chief Financial Officer of Malibu Boats, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101	The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2020 were formatted in Inline XBRL: (i) Condensed Consolidated Statements of Operations and Comprehensive Income (Loss), (ii) Condensed Consolidated Balance Sheets, (iii) Condensed Consolidated Statements of Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows, and (v) the Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags.
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2020, formatted in Inline XBRL (Included as Exhibit 101).

(1)    Filed as an exhibit to Amendment No. 1 to the Company’s registration statement on Form S-1 (Registration No. 333-192862) filed on January 8, 2014.

(2)    Filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-36290) filed on February 6, 2014.

(3)    Filed as an exhibit to the Company's Quarterly Report on Form 10-Q/A (File No. 001-36290) filed on May 13, 2014.

(4)    Filed as an exhibit to the Company's Current Report on Form 8-K (File No. 001-36290) filed on June 27, 2014.

(5)    Filed as an exhibit to the Company’s Annual Report on Form 10-K (File No. 001-36290) filed on August 29, 2019.

(6)    Filed as an exhibit to the Company’s Current Report on Form 8-K (File No. 001-36290) filed on January 5, 2021.

44

SIGNATURE

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.

February 9, 2021	MALIBU BOATS, INC.
	By:	/s/ Jack Springer
		Jack Springer, Chief Executive Officer
		(Principal Executive Officer)
	By:	/s/ Wayne Wilson
		Wayne Wilson, Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

45

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Jack Springer, certify that:

1 I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2020 of Malibu Boats, Inc.;

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: February 9, 2021

/s/ Jack Springer

Jack Springer

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a-14(a) OF THE SECURITIES EXCHANGE ACT OF 1934

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Wayne Wilson, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended December 31, 2020 of Malibu Boats, Inc.;

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: February 9, 2021

/s/ Wayne Wilson

Wayne Wilson

Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002*

In connection with the Quarterly Report of Malibu Boats, Inc. (“Malibu”) on Form 10-Q for the fiscal quarter ended December 31, 2020 (the “Report”), Jack Springer, chief executive officer, and Wayne Wilson, chief financial officer, each hereby certifies, 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 Malibu.

Dated: February 9, 2021

/s/ Jack Springer

Jack Springer

Chief Executive Officer

Dated: February 9, 2021

/s/ Wayne Wilson

Wayne Wilson

Chief Financial Officer

________________________

* A signed original of this written statement required by Section 906 has been provided to Malibu Boats, Inc. and will be retained by Malibu Boats, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover Page - shares	6 Months Ended
	Dec. 31, 2020	Feb. 08, 2021
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Dec. 31, 2020
Document Transition Report	false
Entity File Number	001-36290
Entity Registrant Name	MALIBU BOATS, INC.
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	5075 Kimberly Way,
Entity Address, City or Town	Loudon,
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	37774
Entity Tax Identification Number	46-4024640
City Area Code	(865)
Local Phone Number	458-5478
Title of 12(b) Security	Class A Common Stock, par value $0.01
Trading Symbol	MBUU
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Smaller Reporting Company	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001590976
Amendment Flag	false
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--06-30
Class A Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		20,761,182
Class B Common Stock
Document Information [Line Items]
Entity Common Stock, Shares Outstanding (in shares)		11

XML

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Income Statement [Abstract]
Net sales	$ 195,647	$ 180,112	$ 376,631	$ 352,192
Cost of sales	146,158	140,244	281,401	272,323
Gross profit	49,489	39,868	95,230	79,869
Operating expenses:
Selling and marketing	4,001	4,666	7,613	9,732
General and administrative	15,036	10,078	26,690	20,746
Amortization	1,524	1,537	3,048	3,121
Operating income	28,928	23,587	57,879	46,270
Other (income) expense, net:
Other income, net	(12)	(9)	(22)	(19)
Interest expense	445	957	1,001	2,124
Other expense, net	433	948	979	2,105
Income before provision for income taxes	28,495	22,639	56,900	44,165
Provision for income taxes	6,348	5,041	12,715	9,885
Net income	22,147	17,598	44,185	34,280
Net income attributable to non-controlling interest	922	876	1,867	1,699
Net income attributable to Malibu Boats, Inc.	21,225	16,722	42,318	32,581
Comprehensive income:
Net income	22,147	17,598	44,185	34,280
Other comprehensive income (loss):
Change in cumulative translation adjustment	1,422	615	2,052	(8)
Other comprehensive income (loss)	1,422	615	2,052	(8)
Comprehensive income	23,569	18,213	46,237	34,272
Less: comprehensive income attributable to non-controlling interest	981	907	1,953	1,699
Comprehensive income attributable to Malibu Boats, Inc.	$ 22,588	$ 17,306	$ 44,284	$ 32,573
Weighted average shares outstanding used in computing net income per share:
Basic (in shares)	20,717,359	20,591,241	20,684,644	20,710,681
Diluted (in shares)	20,972,902	20,701,473	20,946,800	20,816,830
Earnings Per Share [Abstract]
Basic (in dollars per share)	$ 1.03	$ 0.81	$ 2.05	$ 1.57
Diluted (in dollars per share)	$ 1.01	$ 0.81	$ 2.02	$ 1.57

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Current assets
Cash	$ 23,729	$ 33,787
Trade receivables, net	14,361	13,767
Inventories, net	96,001	72,946
Prepaid expenses and other current assets	5,908	3,954
Total current assets	139,999	124,454
Property, plant and equipment, net	120,888	94,310
Goodwill	101,215	51,273
Total intangible assets	239,606	139,892
Deferred tax assets	50,618	52,935
Other assets	18,022	14,482
Total assets	670,348	477,346
Current liabilities
Current maturities of long-term obligations	1,250	0
Accounts payable	28,655	15,846
Accrued expenses	65,717	50,485
Income taxes and tax distribution payable	3,072	243
Payable pursuant to tax receivable agreement, current portion	3,589	3,589
Total current liabilities	102,283	70,163
Deferred tax liabilities	28,569	14
Other liabilities	21,036	16,727
Payable pursuant to tax receivable agreement, less current portion	46,619	46,076
Long-term debt	162,357	82,839
Total liabilities	360,864	215,819
Commitments and contingencies
Stockholders' Equity
Preferred Stock, par value $0.01 per share; 25,000,000 shares authorized; no shares issued and outstanding as of December 31, 2020 and June 30, 2020	0	0
Additional paid in capital	106,771	103,797
Accumulated other comprehensive loss	(1,080)	(3,132)
Accumulated earnings	196,029	153,711
Total stockholders' equity attributable to Malibu Boats, Inc.	301,926	254,580
Non-controlling interest	7,558	6,947
Total stockholders’ equity	309,484	261,527
Total liabilities and stockholders' equity	670,348	477,346
Class A Common Stock
Stockholders' Equity
Common stock	206	204
Class B Common Stock
Stockholders' Equity
Common stock	$ 0	$ 0

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Dec. 31, 2020	Jun. 30, 2020
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	25,000,000	25,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Class A Common Stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, shares issued (in shares)	20,753,463	20,595,969
Common stock, shares, outstanding (in shares)	20,753,463	20,595,969
Class B Common Stock
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	25,000,000	25,000,000
Common stock, shares issued (in shares)	12	15
Common stock, shares, outstanding (in shares)	12	15

XML

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Additional Paid In Capital	Accumulated Other Comprehensive Loss	Accumulated Earnings	Accumulated Earnings Cumulative Effect, Period of Adoption, Adjustment	Non-controlling Interest in LLC	Class A Common Stock	Class A Common Stock Common Stock	Class B Common Stock	Class B Common Stock Common Stock
Beginning balance (in shares) at Jun. 30, 2019									20,853,000		15
Beginning balance at Jun. 30, 2019	$ 210,353	$ (1,703)	$ 113,004	$ (2,828)	$ 93,852	$ (1,703)	$ 6,118		$ 207		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	16,682				15,859		823
Stock based compensation, net of withholding taxes on vested equity awards (in shares)									(5,000)
Stock based compensation, net of withholding taxes on vested equity awards	435		435
Issuances of equity for services	80		80
Repurchase and retirement of common stock (in shares)									(383,000)
Repurchase and retirement of common stock	(11,123)		(11,119)						$ (4)
Distributions to LLC Unit holders	(399)						(399)
Foreign currency translation adjustment	(648)			(623)			(25)
Ending balance (in shares) at Sep. 30, 2019									20,465,000		15
Ending balance at Sep. 30, 2019	213,677		102,400	(3,451)	108,008		6,517		$ 203		$ 0
Beginning balance (in shares) at Jun. 30, 2019									20,853,000		15
Beginning balance at Jun. 30, 2019	210,353	$ (1,703)	113,004	(2,828)	93,852	$ (1,703)	6,118		$ 207		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	34,280
Ending balance (in shares) at Dec. 31, 2019									20,583,000		15
Ending balance at Dec. 31, 2019	232,361		103,291	(2,836)	124,730		6,972		$ 204		$ 0
Beginning balance (in shares) at Sep. 30, 2019									20,465,000		15
Beginning balance at Sep. 30, 2019	213,677		102,400	(3,451)	108,008		6,517		$ 203		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	17,598				16,722		876
Stock based compensation, net of withholding taxes on vested equity awards (in shares)									116,000
Stock based compensation, net of withholding taxes on vested equity awards	237		236						$ 1
Issuance of equity for services (in shares)									2,000
Issuances of equity for services	655		655
Distributions to LLC Unit holders	(446)						(446)
Foreign currency translation adjustment	640			615			25
Ending balance (in shares) at Dec. 31, 2019									20,583,000		15
Ending balance at Dec. 31, 2019	232,361		103,291	(2,836)	124,730		6,972		$ 204		$ 0
Beginning balance (in shares) at Jun. 30, 2020								20,595,969	20,596,000	15	15
Beginning balance at Jun. 30, 2020	261,527		103,797	(3,132)	153,711		6,947		$ 204		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	22,038				21,093		945
Stock based compensation, net of withholding taxes on vested equity awards (in shares)									(3,000)
Stock based compensation, net of withholding taxes on vested equity awards	658		658
Issuances of equity for services	59		59
Issuances of equity for exercise of stock options (in shares)									9,000
Issuances of equity for exercise of stock options	300		300
Increase in payable pursuant to the tax receivable agreement	(330)		(330)
Increase in deferred tax asset from step-up in tax basis	480		480
Exchange of LLC Units for Class A Common Stock (in shares)									28,000		(2)
Exchange of LLC Units for Class A Common Stock	0		264				(264)
Distributions to LLC Unit holders	(449)						(449)
Foreign currency translation adjustment	652			630			22
Ending balance (in shares) at Sep. 30, 2020									20,630,000		13
Ending balance at Sep. 30, 2020	284,935		105,228	(2,502)	174,804		7,201		$ 204		$ 0
Beginning balance (in shares) at Jun. 30, 2020								20,595,969	20,596,000	15	15
Beginning balance at Jun. 30, 2020	261,527		103,797	(3,132)	153,711		6,947		$ 204		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 44,185
Issuances of equity for exercise of stock options (in shares)	9,625
Ending balance (in shares) at Dec. 31, 2020								20,753,463	20,753,000	12	12
Ending balance at Dec. 31, 2020	$ 309,484		106,771	(1,080)	196,029		7,558		$ 206		$ 0
Beginning balance (in shares) at Sep. 30, 2020									20,630,000		13
Beginning balance at Sep. 30, 2020	284,935		105,228	(2,502)	174,804		7,201		$ 204		$ 0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	22,147				21,225		922
Stock based compensation, net of withholding taxes on vested equity awards (in shares)									110,000
Stock based compensation, net of withholding taxes on vested equity awards	752		750						$ 2
Issuance of equity for services (in shares)									1,000
Issuances of equity for services	659		659
Increase in payable pursuant to the tax receivable agreement	(213)		(213)
Increase in deferred tax asset from step-up in tax basis	229		229
Exchange of LLC Units for Class A Common Stock (in shares)									12,000		(1)
Exchange of LLC Units for Class A Common Stock	0		118				(118)
Distributions to LLC Unit holders	(495)						(495)
Foreign currency translation adjustment	1,470			1,422			48
Ending balance (in shares) at Dec. 31, 2020								20,753,463	20,753,000	12	12
Ending balance at Dec. 31, 2020	$ 309,484		$ 106,771	$ (1,080)	$ 196,029		$ 7,558		$ 206		$ 0

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Operating activities:
Net income	$ 44,185	$ 34,280
Adjustments to reconcile net income to net cash provided by operating activities:
Non-cash compensation expense	2,611	1,490
Non-cash compensation to directors	421	415
Depreciation	7,085	6,102
Amortization	3,048	3,121
Deferred income taxes	3,051	2,794
Other items, net	568	1,034
Change in operating assets and liabilities (excluding effects of acquisition):
Trade receivables	2,702	12,125
Inventories	(14,692)	(9,022)
Prepaid expenses and other assets	(2,178)	(675)
Accounts payable	8,980	1,155
Income taxes payable	3,537	(1,234)
Accrued expenses	13,356	1,668
Other liabilities	(73)	(744)
Net cash provided by operating activities	72,601	52,509
Investing activities:
Purchases of property, plant and equipment	(11,525)	(19,313)
Payment for acquisition, net of cash acquired	(150,427)	0
Net cash used in investing activities	(161,952)	(19,313)
Financing activities:
Proceeds from long-term borrowings	25,000	0
Proceeds from revolving credit facility	65,000	0
Payments on revolving credit facility	(8,800)	(20,000)
Payment of deferred financing costs	(638)	0
Proceeds received from exercise of stock options	300	0
Cash paid for withholding taxes on vested restricted stock	(1,171)	(811)
Distributions to LLC Unit holders	(553)	(969)
Repurchase and retirement of common stock	0	(11,123)
Net cash provided by (used in) financing activities	79,138	(32,903)
Effect of exchange rate changes on cash	155	22
Changes in cash	(10,058)	315
Cash—Beginning of period	33,787	27,392
Cash—End of period	23,729	27,707
Supplemental cash flow information:
Cash paid for interest	787	2,133
Cash paid for income taxes	$ 6,478	$ 7,300

XML

Organization, Basis of Presentation, and Summary of Significant Accounting Policies

6 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization, Basis of Presentation, and Summary of Significant Accounting Policies

Organization, Basis of Presentation, and Summary of Significant Accounting Policies

Organization

Malibu Boats, Inc. (together with its subsidiaries, the “Company” or "Malibu"), a Delaware corporation formed on November 1, 2013, is the sole managing member of Malibu Boats Holdings, LLC, a Delaware limited liability company (the "LLC"). The Company operates and controls all of the LLC's business and affairs and, therefore, pursuant to Financial Accounting Standards Board ("FASB") Accounting Standards Codification (“ASC”) Topic 810, Consolidation, consolidates the financial results of the LLC and its subsidiaries, and records a non-controlling interest for the economic interest in the Company held by the non-controlling holders of units in the LLC ("LLC Units"). Malibu Boats Holdings, LLC was formed in 2006. The LLC, through its wholly owned subsidiary, Malibu Boats, LLC, (“Boats LLC”), is engaged in the design, engineering, manufacturing and marketing of innovative, high-quality, recreational powerboats that are sold through a world-wide network of independent dealers. On December 31, 2020, the Company acquired all of the outstanding stock of Maverick Boat Group, Inc. (“Maverick Boat Group”). As a result of the acquisition, the Company consolidates the financial results of the Maverick Boat Group. Maverick Boat Group designs and manufactures center console, dual console, flats and bay boats under four brands -- Cobia, Pathfinder, Maverick and Hewes brands. In addition to the Maverick Boat Group’s family of brands, the Company sells its boats under the Malibu, Axis, Cobalt and Pursuit brands. In connection with the acquisition of Maverick Boat Group, the Company revised its segment reporting to report its results of operations under three reportable segments -- Malibu, Cobalt and Saltwater Fishing.

COVID-19 Pandemic

The COVID-19 pandemic has impacted the Company’s operations and financial results since the third quarter of fiscal year 2020 and continues to impact the Company. The Company elected to suspend operations at all of its facilities on March 24, 2020. The shut-down continued into the fourth quarter 2020 with operations resuming between late April and early May, depending on the facility. As a result, the Company was not able to ship boats to its dealers during the period of shut-down, which negatively impacted its net sales for the second half of fiscal year 2020. In addition, the COVID-19 pandemic has impacted and may continue to impact the operations of the Company’s dealers and suppliers. The future impact of COVID-19 on the Company’s financial condition and results of operations will depend on a number of factors, including factors that we may not be able to forecast at this time.

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim condensed financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and disclosures of results of operations, financial position and changes in cash flow in conformity with GAAP for complete financial statements. Such statements should be read in conjunction with the audited consolidated financial statements and notes thereto of Malibu Boats, Inc. and subsidiaries for the year ended June 30, 2020, included in the Company's Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Units and shares are presented as whole numbers while all dollar amounts are presented in thousands, unless otherwise noted.

Acquisition of Maverick Boat Group, Inc. and Related Financing

On December 31, 2020, MBG Holdco, Inc., a wholly-owned subsidiary of Boats, LLC, acquired all of the outstanding shares of Maverick Boat Group from its existing stockholders for a purchase price of $150,675. The purchase price was subject to customary adjustments for the amounts of cash, indebtedness and working capital in the business at the closing date and subject to adjustment for certain capital expenditures made by Maverick Boat Group prior to closing at the Company’s request. With two manufacturing facilities located in Fort Pierce, Florida, Maverick Boat Group designs and manufactures center console, dual console, flats and bay boats under four brand names Cobia, Pathfinder, Maverick, and Hewes. The Company paid the purchase price with cash on hand and $90,000 of borrowings under its credit facilities following an amendment to increase the amount available under its credit facilities as described below.

On December 30, 2020, Boats, LLC, as the borrower, entered into the Third Incremental Facility Amendment and Third Amendment (the “Third Amendment”) to its existing Second Amended and Restated Credit Agreement dated as of June 28,

2017, by and among Boats LLC, the LLC and certain subsidiaries of Boats LLC parties thereto, as guarantors, the lenders parties thereto and Truist Bank (successor by merger to SunTrust Bank), as administrative agent, swingline lender and issuing bank (as amended, the “Credit Agreement”). The Third Amendment added a $25,000 incremental term loan facility with a maturity date of July 1, 2024 and increased the borrowing capacity available under the revolving credit facility by $50,000 from $120,000 to $170,000. The $25,000 incremental term loans made pursuant to the Third Amendment is subject to quarterly amortization at a rate of 5.0% per annum through December 31, 2022 and at a rate of 7.5% per annum thereafter and accrues interest at the same rate as other loans under the Credit Agreement.

Refer to Notes 4, 10 and 17 for further information.

Segment Information

Effective December 31, 2020, the Company revised its segment reporting to account for its acquisition of Maverick Boat Group and conform to changes in its internal management reporting based on the Company’s boat manufacturing operations. The Company previously had three reportable segments, Malibu, Cobalt and Pursuit. The Company now aggregates Pursuit and Maverick Boat Group into one reportable segment as they have similar economic characteristics and qualitative factors. As a result the Company continues to have three reportable segments, Malibu, Cobalt and Saltwater Fishing. See Note 17.

Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements include the operations and accounts of the Company and all subsidiaries thereof. All intercompany balances and transactions have been eliminated upon consolidation.

Recent Accounting Pronouncements

In June 2016, the FASB issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and in November 2018 issued a subsequent amendment, ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 will replace today’s “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. ASU 2018-19 will affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope of this amendment that have the contractual right to receive cash. On July 1, 2020, the Company adopted this standard and the adoption did not have a material impact on the Company’s consolidated financial position, results of operations, equity or cash flows.

There are no other new accounting pronouncements that are expected to have a significant impact on the Company's consolidated financial statements and related disclosures.

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Revenue Recognition

6 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

The following table disaggregates the Company's revenue by major product type and geography:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	105,687	$	46,932	$	39,423	$	192,042	$	199,681	$	90,337	$	75,826	$	365,844
Part and other sales	2,930		546		129		3,605		8,767		1,623		397		10,787
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Revenue by geography:
North America	$	98,242	$	45,196	$	36,841	$	180,279	$	194,160	$	89,149	$	72,591	$	355,900
International	10,375		2,282		2,711		15,368		14,288		2,811		3,632		20,731
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631

	Three Months Ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	94,350	$	48,579	$	33,715	$	176,644	$	176,433	$	97,879	$	69,521	$	343,833
Part and other sales	2,977		415		76		3,468		6,774		1,266		319		8,359
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Revenue by geography:
North America	$	89,643	$	46,822	$	33,114	$	169,579	$	168,560	$	95,580	$	65,365	$	329,505
International	7,684		2,172		677		10,533		14,647		3,565		4,475		22,687
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192

Boat and Trailer Sales

Consists of sales of boats and trailers to the Company's dealer network, net of sales returns, discounts, rebates and free flooring incentives. Boat and trailer sales also includes optional boat features. Sales returns consist of boats returned by dealers under our warranty program. Rebates, free flooring and discounts are incentives that the Company provides to its dealers based on sales of eligible products.

Parts and Other Sales

Consists primarily of parts and accessories sales, royalty income and clothing sales. Parts and accessories sales include replacement and aftermarket boat parts and accessories sold to the Company's dealer network. Royalty income is earned from license agreements with various boat manufacturers, including Nautique, Chaparral, Mastercraft, and Tige related to the use of the Company's intellectual property.

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Non-controlling Interest

6 Months Ended

Dec. 31, 2020

Noncontrolling Interest [Abstract]

Non-controlling Interest

Non-controlling Interest

The non-controlling interest on the unaudited interim condensed consolidated statement of operations and comprehensive income represents the portion of earnings attributable to the economic interest in the Company's subsidiary, Malibu Boats Holdings, LLC, held by the non-controlling LLC Unit holders. Non-controlling interest on the unaudited interim condensed consolidated balance sheets represents the portion of net assets of the Company attributable to the non-controlling LLC Unit holders, based on the portion of the LLC Units owned by such Unit holders. The ownership of Malibu Boats Holdings, LLC is summarized as follows:

	As of December 31, 2020			As of June 30, 2020
	Units	Ownership %		Units	Ownership %
Non-controlling LLC Unit holders ownership in Malibu Boats Holdings, LLC	691,305	3.2	%	730,652	3.4	%
Malibu Boats, Inc. ownership in Malibu Boats Holdings, LLC	20,753,463	96.8		20,595,969	96.6
	21,444,768	100.0	%	21,326,621	100.0	%

Issuance of Additional LLC Units

Under the first amended and restated limited liability company agreement of the LLC, as amended (the "LLC Agreement"), the Company is required to cause the LLC to issue additional LLC Units to the Company when the Company issues additional shares of Class A Common Stock. Other than in connection with the issuance of Class A Common Stock in connection with an equity incentive program, the Company must contribute to the LLC net proceeds and property, if any, received by the Company with respect to the issuance of such additional shares of Class A Common Stock. The Company must cause the LLC to issue a number of LLC Units equal to the number of shares of Class A Common Stock issued such that, at all times, the number of LLC Units held by the Company equals the number of outstanding shares of Class A Common Stock. During the six months ended December 31, 2020, the Company caused the LLC to issue a total of 167,159 LLC Units to the Company in connection with (i) the Company's issuance of Class A Common Stock to a non-employee director for her services, (ii) the issuance of Class A Common Stock for the vesting of awards granted under the Malibu Boats, Inc. Long-Term Incentive Plan (the

"Incentive Plan"), (iii) the issuance of restricted Class A Common Stock granted under the Incentive Plan (iv) the issuance of Class A Common Stock to LLC Unit holders in exchange of their LLC Units and (v) the issuance of Class A Common Stock for the exercise of options granted under the Incentive Plan. During the six months ended December 31, 2020, 9,665 LLC Units were canceled in connection with the vesting of share-based equity awards to satisfy employee tax withholding requirements and the retirement of 9,665 treasury shares in accordance with the LLC Agreement.

Distributions and Other Payments to Non-controlling Unit Holders

Distributions for Taxes

As a limited liability company (treated as a partnership for income tax purposes), Malibu Boats Holdings, LLC does not incur significant federal, state or local income taxes, as these taxes are primarily the obligations of its members. As authorized by the LLC Agreement, the LLC is required to distribute cash, to the extent that the LLC has cash available, on a pro rata basis, to its members to the extent necessary to cover the members’ tax liabilities, if any, with respect to their share of LLC earnings. The LLC makes such tax distributions to its members based on an estimated tax rate and projections of taxable income. If the actual taxable income of the LLC multiplied by the estimated tax rate exceeds the tax distributions made in a calendar year, the LLC may make true-up distributions to its members, if cash or borrowings are available for such purposes. As of December 31, 2020 and June 30, 2020, tax distributions payable to non-controlling LLC Unit holders were $495 and $104, respectively. During the six months ended December 31, 2020 and 2019, tax distributions paid to the non-controlling LLC Unit holders were $553 and $969, respectively.

Other Distributions

Pursuant to the LLC Agreement, the Company has the right to determine when distributions will be made to LLC members and the amount of any such distributions. If the Company authorizes a distribution, such distribution will be made to the members of the LLC (including the Company) pro rata in accordance with the percentages of their respective LLC units.

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Acquisitions

6 Months Ended

Dec. 31, 2020

Business Combinations [Abstract]

Acquisitions

Acquisitions

On December 31, 2020, the Company completed its acquisition of all the outstanding stock of Maverick Boat Group. The aggregate purchase price for the transaction was $150,675, funded with cash and borrowings under the Company's credit facilities. The aggregate purchase price was subject to certain adjustments, including customary adjustments for the amount of cash, indebtedness and working capital in the business at the closing date and subject to adjustment for certain capital expenditures made by Maverick Boat Group prior to closing at the Company’s request. The Company accounted for the transaction in accordance with ASC Topic 805, Business Combinations.

The total consideration given to the stockholders of Maverick Boat Group has been allocated to the assets acquired and liabilities assumed based on preliminary estimates of fair value as of the date of the acquisition. The preliminary measurements of fair value were determined based upon estimates utilizing the assistance of third party valuation specialists, and are subject to change within the measurement period (up to one year from the acquisition date). The Company expects appraisals of tangible and intangible assets and working capital adjustments to be finalized during the second half of fiscal 2021.

The following table summarizes the preliminary purchase price allocation based on the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:

Consideration:
Cash consideration paid	$	150,675
Recognized preliminary amounts of identifiable assets acquired and (liabilities assumed), at fair value:
Cash	$	248
Accounts receivable	3,204
Inventories	7,756
Other current assets	194
Property, plant and equipment	22,618
Identifiable intangible assets	102,600
Other assets	4,410
Current liabilities	(6,611)
Deferred tax liabilities	(28,528)
Other liabilities	(4,405)
Fair value of assets acquired and liabilities assumed	101,486
Goodwill	49,189
Total purchase price	$	150,675

The preliminary fair value estimates for the Company's identifiable intangible assets acquired as part of the acquisition are as follows:

	Estimates of Fair Value		Estimated Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	47,900	20
Total definite-lived intangibles	47,900
Indefinite-lived intangible:
Trade name	54,700
Total intangible assets	$	102,600

The preliminary value allocated to inventories reflects the estimated fair value of the acquired inventory based on the expected sales price of the inventory, less an estimated cost to complete and a reasonable profit margin. The fair value of the identifiable intangible assets were determined based on the following approaches:

Dealer Relationships - The value associated with Maverick Boat Group's dealer relationships is attributed to its long standing dealer distribution network. The estimate of fair value assigned to this asset was determined using the income approach, which requires an estimate or forecast of the expected future cash flows from the dealer relationships through the application of the multi-period excess earnings approach. The estimated remaining useful life of dealer relationships is approximately twenty years.

Trade Name - The value attributed to Maverick Boat Group's trade names was determined using a variation of the income approach called the relief from royalty method, which requires an estimate or forecast of the expected future cash flows. The trade name has an indefinite life.

The fair value of the definite-lived intangible assets are being amortized using the straight-line method to general and administrative expenses over their estimated useful lives. Indefinite-lived intangible assets are not amortized, but instead are evaluated for potential impairment on an annual basis in accordance with the provisions of ASC Topic 350, Intangibles—Goodwill and Other. The weighted average useful life of identifiable definite-lived intangible assets acquired was 20 years. Goodwill of $49,189 arising from the acquisition consists of expected synergies and cost savings as well as intangible assets that do not qualify for separate recognition.

Acquisition-related costs of $2,577, which were incurred by the Company in the first six months of fiscal year 2021 related to the Maverick Boat Group acquisition, were expensed in the period incurred, and are included in general and administrative expenses in the consolidated statement of operations and comprehensive income for the six months ended December 31, 2020.

Pro Forma Financial Information (unaudited):

The following unaudited pro forma consolidated results of operations for the three and six months ended December 31, 2020 and 2019, assumes that the acquisition of Maverick Boat Group occurred as of July 1, 2019. The unaudited interim pro forma financial information combines historical results of Malibu and Maverick Boat Group, with adjustments for depreciation and amortization attributable to preliminary fair value estimates on acquired tangible and intangible assets for the respective periods. Non-recurring pro forma adjustments associated with the fair value step up of inventory were included in the reported pro forma cost of sales and earnings. The unaudited interim pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal year 2020 or the results that may occur in the future:

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Net sales	$	224,348	$	211,113	$	432,651	$	417,001
Net income	23,287		19,102		46,500		36,200
Net income attributable to Malibu Boats, Inc.	22,335		18,179		44,572		34,457
Basic earnings per share	$	1.08	$	0.88	$	2.16	$	1.66
Diluted earnings per share	$	1.06	$	0.88	$	2.13	$	1.66

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Inventories

6 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Inventories

Inventories, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Raw materials	$	68,078	$	52,530
Work in progress	17,973		10,778
Finished goods	9,950		9,638
Total inventories	$	96,001	$	72,946

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Property, Plant and Equipment

6 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

Property, plant and equipment, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Land	$	3,960	$	2,540
Building and leasehold improvements	73,437		54,318
Machinery and equipment	61,475		55,831
Furniture and fixtures	7,762		7,031
Construction in process	14,214		10,470
	160,848		130,190
Less: Accumulated depreciation	(39,960)		(35,880)
Property, plant and equipment, net	$	120,888	$	94,310

Depreciation expense was $3,599 and $3,005 for the three months ended December 31, 2020 and 2019, respectively, and $7,085 and $6,102 for the six months ended December 31, 2020 and 2019, respectively substantially all of which was recorded in cost of sales.

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Goodwill and Other Intangible Assets

6 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill for the six months ended December 31, 2020 were as follows:

Goodwill as of June 30, 2020	$	51,273
Addition related to the acquisition of Maverick Boat Group	49,189
Effect of foreign currency changes on goodwill	753
Goodwill as of December 31, 2020	$	101,215

The components of other intangible assets were as follows:

	As of December 31, 2020		As of June 30, 2020		Estimated Useful Life (in years)	Weighted Average Remaining Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	159,459	$	111,293	8-20	18.1
Patent	3,986		3,986		12-15	11.5
Trade name	24,667		24,667		15	1.1
Non-compete agreement	54		48		10	3.8
Total	188,166		139,994
Less: Accumulated amortization	(66,760)		(63,602)
Total definite-lived intangible assets, net	121,406		76,392
Indefinite-lived intangible:
Trade name	118,200		63,500
Total other intangible assets, net	$	239,606	$	139,892

Amortization expense recognized on all amortizable intangibles was $1,524 and $1,537 for the three months ended December 31, 2020 and 2019, respectively, and $3,048 and $3,121 for the six months ended December 31, 2020 and 2019, respectively.

The estimated future amortization of definite-lived intangible assets is as follows:

Fiscal years ending June 30:		Amount
	Remainder of 2021	$	4,206
	2022	6,967
	2023	6,830
	2024	6,830
	2025	6,826
	2026 and thereafter	89,747
		$	121,406

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Accrued Expenses

6 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Accrued Expenses

Accrued Expenses

Accrued expenses consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Warranties	$	31,046	$	27,500
Dealer incentives	11,685		7,777
Accrued compensation	11,826		9,885
Current operating lease liabilities	1,977		2,006
Accrued legal and professional fees	2,114		1,055
Customer deposits	5,194		1,059
Other accrued expenses	1,875		1,203
Total accrued expenses	$	65,717	$	50,485

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Product Warranties

6 Months Ended

Dec. 31, 2020

Product Warranties Disclosures [Abstract]

Product Warranties

Product Warranties

Malibu and Axis brand boats have a limited warranty for a period up to five years for both Malibu and Axis brand boats. The Company’s Cobalt brand boats have (1) a structural warranty of up to ten years which covers the hull, deck joints, bulkheads, floor, transom, stringers, and motor mount and (2) a five year bow-to-stern warranty on all components manufactured or purchased (excluding hull and deck structural components), including canvas and upholstery. Gelcoat is covered up to three years for Cobalt and one year for Malibu and Axis. Pursuit brand boats have (1) a limited warranty for a period of up to five years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of two years (excluding hull and deck structural components). Maverick, Pathfinder and Hewes brand boats have (1) a limited warranty for a period of up to five years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of one year (excluding hull and deck structural components). Cobia brand boats have (1) a limited warranty for a period of up to ten years on structural components such as the hull, deck and defects in the gelcoat surface of the hull bottom and (2) a bow to stern warranty of three years (excluding hull and deck structural components). For each boat brand, there are certain materials, components or parts of the boat that are not covered by the Company’s warranty and certain components or parts that are separately warranted by the manufacturer or supplier (such as the engine). Engines that the Company manufactures for Malibu and Axis models have a limited warranty of up to five years or five-hundred hours.

The Company’s standard warranties require it or its dealers to repair or replace defective products during the warranty period at no cost to the consumer. The Company estimates warranty costs it expects to incur and records a liability for such costs at the time the product revenue is recognized. The Company utilizes historical claims trends and analytical tools to develop the estimate of its warranty obligation on a per boat basis, by brand and warranty year. Factors that affect the Company’s warranty liability include the number of units sold, historical and anticipated rates of warranty claims and cost per claim. The Company assesses the adequacy of its recorded warranty liabilities and adjusts the amounts as necessary. Beginning in model year 2016, the Company increased the term of its limited warranty for Malibu brand boats from three years to five years and for Axis brand boats from two years to five years. Beginning in model year 2018, the Company increased the term of its bow-to-stern warranty for Cobalt brand boats from three years to five years. As a result of these changes, all of the Company’s Malibu, Axis and Cobalt brand boats with historical claims experience that are no longer covered under warranty had warranty terms shorter than the current warranty term of five years. Accordingly, the Company has little to no historical claims experience for warranty years four and five, and as such, these estimates give rise to a higher level of estimation uncertainty. Future warranty claims may differ from the Company’s estimate of the warranty liability, which could lead to changes in the Company’s warranty liability in future periods.

Changes in the Company’s product warranty liability, which is included in accrued expenses on the unaudited interim condensed consolidated balance sheets, were as follows: 

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Beginning balance	$	29,077	$	25,034	$	27,500	$	23,820
Add: Warranty expense	4,791		5,196		9,646		9,102
Additions for acquisitions	883		—		883		—
Less: Warranty claims paid	(3,705)		(3,520)		(6,983)		(6,212)
Ending balance	$	31,046	$	26,710	$	31,046	$	26,710

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Financing

6 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Financing

Financing

Outstanding debt consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Term loan	$	100,000	$	75,000
Revolving credit loan	65,000		8,800
Less unamortized debt issuance costs	(1,393)		(961)
Total debt	163,607		82,839
Less current maturities	(1,250)		—
Long-term debt less current maturities	$	162,357	$	82,839

Long-Term Debt

As of December 31, 2020, the Company has a revolving credit facility with borrowing capacity of up to $170,000 and term loans with an aggregate principal amount of $100,000 outstanding. As of December 31, 2020, the Company had $65,000 outstanding under its revolving credit facility and $1,234 in outstanding letters of credit, with $103,766 available for borrowing. The revolving credit facility matures on July 1, 2024, the incremental term loan made on December 30, 2020 in a principal amount of $25,000 (the “Incremental Term Loan”) matures on July 1, 2024 and the remaining $75,000 of outstanding term loans (the “Existing Term Loans,” and together with the Incremental Term Loans, the “Term Loans”) mature on July 1, 2022.

On December 30, 2020, Boats LLC entered into the Third Amendment to its Credit Agreement. The Third Amendment added a $25,000 Incremental Term Loan facility with a maturity date of July 1, 2024 and increased the borrowing capacity of the revolving credit facility by $50,000 from $120,000 to $170,000. The Incremental Term Loan is subject to quarterly amortization at a rate of 5.0% per annum through December 31, 2022 and at a rate of 7.5% per annum through June 30, 2024 and accrues interest at the same interest rate applicable to other loans under the Credit Agreement as described below.

The obligations of Boats LLC under the Credit Agreement are guaranteed by the LLC, and, subject to certain exceptions, the present and future domestic subsidiaries of Boats LLC, and all such obligations are secured by substantially all of the assets of the LLC, Boats LLC and such subsidiary guarantors. Malibu Boats, Inc. is not a party to the Credit Agreement. Borrowings under the Credit Agreement bear interest at a rate equal to either, at the Company's option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.5%, or one-month LIBOR plus 1% (the “Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 1.25% to 2.25% with respect to LIBOR borrowings and 0.25% to 1.25% with respect to Base Rate borrowings. The applicable margin will be based upon the consolidated leverage ratio of the LLC and its subsidiaries calculated on a consolidated basis. As of December 31, 2020, the interest rate on the Company’s term loans and revolving credit facility was 1.39%. The Company is required to pay a commitment fee for any unused portion of the revolving credit facility which will range from 0.20% to 0.40% per annum, depending on the LLC’s and its subsidiaries’ consolidated leverage ratio.

The Credit Agreement permits prepayment of the Term Loans without any penalties. The Existing Term Loans require an amortization payment of approximately $3,000 on March 31, 2022 and the balance of the Existing Term Loans is due on the scheduled maturity date of July 1, 2022. The Incremental Term Loan of $25,000 is subject to quarterly amortization at a rate of 5.0% per year through December 31, 2022, resulting in $1,250 being reflected as current maturities of long-term obligations, 7.5% per year through June 30, 2024 and the balance of the Incremental Term Loan is due on the scheduled maturity date of

July 1, 2024. The Credit Agreement also requires prepayments from the net cash proceeds received by Boats LLC or any guarantors from certain asset sales and recovery events, subject to certain reinvestment rights, and from excess cash flow, subject to the terms and conditions of the Credit Agreement.

The Credit Agreement contains certain customary representations and warranties, and notice requirements for the occurrence of specific events such as the occurrence of any event of default, or pending or threatened litigation. The Credit Agreement also requires compliance with certain customary financial covenants, including a minimum ratio of EBITDA to fixed charges and a maximum ratio of total debt to EBITDA. The Credit Agreement contains certain restrictive covenants, which, among other things, place limits on certain activities of the loan parties under the Credit Agreement, such as the incurrence of additional indebtedness and additional liens on property and limit the future payment of dividends or distributions. For example, the Credit Agreement generally prohibits the LLC, Boats LLC and the subsidiary guarantors from paying dividends or making distributions, including to the Company. The credit facility permits, however, (i) distributions based on a member’s allocated taxable income, (ii) distributions to fund payments that are required under the LLC’s tax receivable agreement, (iii) purchase of stock or stock options of the LLC from former officers, directors or employees of loan parties or payments pursuant to stock option and other benefit plans up to $3,000 in any fiscal year, and (iv) share repurchase payments up to $35,000 in any fiscal year subject to one year carry forward and compliance with other financial covenants. In addition, the LLC may make dividends and distributions of up to $10,000 in any fiscal year, subject to compliance with other financial covenants.

In connection with entering into the Credit Agreement, the Company capitalized $2,074 in deferred financing costs during fiscal 2017. In connection with Third Amendment the Company capitalized $638 in deferred financing costs during the six months ended December 31, 2020. These costs, in addition to the unamortized balance related to costs associated with the Company's previous credit facility of $671, are being amortized over the term of the Credit Agreement into interest expense using the effective interest method and presented as a direct offset to the total debt outstanding on the consolidated balance sheets.

The Company used proceeds from an offering on August 24, 2017 to repay $50,000 on its Existing Term Loans under the Credit Agreement and exercised its option to apply the prepayment to principal installments through December 31, 2021, and a portion of principal installments due on March 31, 2022. The $50,000 repayment resulted in a write off of deferred financing costs of $829 in fiscal year 2018, which was included in amortization expense on the consolidated statement of operations and comprehensive income.

Covenant Compliance

As of December 31, 2020, the Company was in compliance with the financial covenants contained in the Credit Agreement.

Interest Rate Swap

On July 1, 2015, the Company entered into a five year floating to fixed interest rate swap with an effective start date of July 1, 2015. The swap was based on a one-month LIBOR rate versus a 1.52% fixed rate on a notional value of $39,250, which under terms of the previously existing credit agreement, was equal to 50% of the outstanding balance of the term loan at the time of the swap arrangement. Under ASC Topic 815, Derivatives and Hedging, all derivative instruments are recorded on the unaudited interim condensed consolidated balance sheets at fair value as either short term or long term assets or liabilities based on their anticipated settlement date. The Company has elected not to designate its interest rate swap as a hedge for accounting purposes; therefore, changes in the fair value of the derivative instrument were being recognized in earnings in the Company's unaudited interim condensed consolidated statements of operations and comprehensive income. The swap matured on March 31, 2020. For the three and six months ended December 31, 2019, the Company recorded a loss of $20 and $58, respectively, for the change in fair value of the interest rate swap, which was included in interest expense in the unaudited interim condensed consolidated statements of operations and comprehensive income.

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Leases

6 Months Ended

Dec. 31, 2020

Leases [Abstract]

Leases

LeasesThe Company leases certain manufacturing facilities, warehouses, office space, land, and equipment. The Company determines if a contract is a lease or contains an embedded lease at the inception of the agreement. The Company recorded right-of-use assets, included in other assets on the consolidated balance sheet, totaling $16,142 as of July 1, 2019. Leases with an initial term of 12 months or less are not recorded on the unaudited interim condensed consolidated balance sheet. The Company does not separate non-lease components from the lease components to which they relate, and instead accounts for each separate lease and non-lease component associated with that lease component as a single lease component for all underlying asset classes. The Company's lease liabilities do not include future lease payments related to options to extend or terminate lease agreements as it is not reasonably certain those options will be exercised.

Other information concerning the Company's operating leases accounted for under ASC Topic 842, Leases is as follows (in thousands):

Classification		As of December 31, 2020		As of June 30, 2020
Assets
Right-of-use assets	Other assets	$	13,473	$	14,315
Liabilities
Current operating lease liabilities	Accrued expenses	$	1,977	$	2,006
Long-term operating lease liabilities	Other liabilities	13,162		14,013
Total lease liabilities		$	15,139	$	16,019

Classification		Three Months Ended December 31, 2020		Three months ended December 31, 2019		Six Months Ended December 31, 2020		Six Months Ended December 31, 2019
Operating lease costs (1)	Cost of sales	$	504	$	473	$	1,012	$	950
	Selling and marketing, and general and administrative	208		220		422		443
Sublease income	Other income, net	10		9		19		19
Cash paid for amounts included in the measurement of operating lease liabilities	Cash flows from operating activities	652		655		1,309		1,302

(1) Includes short-term leases, which are insignificant, and are not included in the lease liability.

The lease liability for operating leases that contain variable escalating rental payments with scheduled increases that are based on the lesser of a stated percentage increase or the cumulative increase in an index, are determined using the stated percentage increase.

The weighted average remaining lease term for the three months ended December 31, 2020 and 2019 was 6.93 years and 7.73 years, respectively. The weighted average discount rate determined based on the Company's incremental borrowing rate is 3.65%, as of December 31, 2020 and 2019.

Future annual minimum lease payments for the following fiscal years as of December 31, 2020 are as follows:

	Amount
Remainder of 2021	$	1,268
2022	2,433
2023	2,484
2024	2,608
2025	2,314
2026 and thereafter	6,015
Total	17,122
Less imputed interest	(1,983)
Present value of lease liabilities	$	15,139

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Tax Receivable Agreement Liability

6 Months Ended

Dec. 31, 2020

Tax Receivable Agreement [Abstract]

Tax Receivable Agreement Liability

Tax Receivable Agreement LiabilityThe Company has a tax receivable agreement with the pre-IPO owners of the LLC that provides for payment by the Company to the pre-IPO owners (or their permitted assignees) of 85% of the amount of the benefits, if any, that the Company is

deemed to realize as a result of (i) increases in tax basis and (ii) certain other tax benefits related to the Company entering into the tax receivable agreement, including those attributable to payments under the tax receivable agreement. These contractual payment obligations are obligations of the Company and not of the LLC. The Company's tax receivable agreement liability was determined on an undiscounted basis in accordance with ASC Topic 450, Contingencies, since the contractual payment obligations were deemed to be probable and reasonably estimable. The tax receivable agreement further provides that, upon certain mergers, asset sales or other forms of business combinations or other changes of control, the Company (or its successor) would owe to the pre-IPO owners of the LLC a lump-sum payment equal to the present value of all forecasted future payments that would have otherwise been made under the tax receivable agreement that would be based on certain assumptions, including a deemed exchange of LLC Units and that the Company would have sufficient taxable income to fully utilize the deductions arising from the increased tax basis and other tax benefits related to entering into the tax receivable agreement. The Company also is entitled to terminate the tax receivable agreement, which, if terminated, would obligate the Company to make early termination payments to the pre-IPO owners of the LLC. In addition, a pre-IPO owner may elect to unilaterally terminate the tax receivable agreement with respect to such pre-IPO owner, which would obligate the Company to pay to such existing owner certain payments for tax benefits received through the taxable year of the election.

For purposes of the tax receivable agreement, the benefit deemed realized by the Company will be computed by comparing the actual income tax liability of the Company (calculated with certain assumptions) to the amount of such taxes that the Company would have been required to pay had there been no increase to the tax basis of the assets of the LLC as a result of the purchases or exchanges, and had the Company not entered into the tax receivable agreement.

The following table reflects the changes to the Company's tax receivable agreement liability:

	As of December 31, 2020		As of June 30, 2020
Payable pursuant to tax receivable agreement	$	49,665	$	53,754
Additions (reductions) to tax receivable agreement:
Exchange of LLC Units for Class A Common Stock	543		1,041
Adjustment for change in estimated tax rate	—		(1,672)
Payments under tax receivable agreement	—		(3,458)
	50,208		49,665
Less current portion under tax receivable agreement	(3,589)		(3,589)
Payable pursuant to tax receivable agreement, less current portion	$	46,619	$	46,076

When estimating the expected tax rate to use in order to determine the tax benefit expected to be recognized from the Company’s increased tax basis as a result of exchanges of LLC Units by the pre-IPO owners of the LLC, the Company continuously monitors changes in its overall tax posture, including changes resulting from new legislation and changes as a result of new jurisdictions in which the Company is subject to tax.

As of December 31, 2020 and June 30, 2020, the Company had deferred tax assets of $112,220 and $111,511, respectively, associated with basis differences in assets upon acquiring an interest in Malibu Boats Holdings, LLC and pursuant to making an election under Section 754 of the Internal Revenue Code of 1986 (the "Internal Revenue Code"), as amended. The aggregate tax receivable agreement liability represents 85% of the tax benefits that the Company expects to receive in connection with the Section 754 election. In accordance with the tax receivable agreement, the next annual payment is anticipated approximately 75 days after filing the federal tax return due by April 15, 2021

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Income Taxes

6 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Malibu Boats, Inc. is taxed as a C corporation for U.S. income tax purposes and is therefore subject to both federal and state taxation at a corporate level. The LLC continues to operate in the United States as a partnership for U.S. federal income tax purposes.

Income taxes are computed in accordance with ASC Topic 740, Income Taxes, and reflect the net tax effects of temporary differences between the financial reporting carrying amounts of assets and liabilities and the corresponding income tax amounts. The Company has deferred tax assets and liabilities and maintains valuation allowances where it is more likely than not that all or a portion of deferred tax assets will not be realized. To the extent the Company determines that it will not realize the benefit of some or all of its deferred tax assets, such deferred tax assets will be adjusted through the Company’s provision for income taxes in the period in which this determination is made.

As of December 31, 2020 and June 30, 2020, the Company maintained a total valuation allowance of $14,693 and $14,582, respectively, against deferred tax assets related to state net operating losses and future amortization deductions (with respect to the Section 754 election) that are reported in the Tennessee corporate tax return without offsetting income, which is taxable at the LLC. This also includes a valuation allowance in the amount of $580 related to foreign tax credit carryforward that is not expected to be utilized in the future.

The Company’s consolidated interim effective tax rate is based upon expected annual income from operations, statutory tax rates and tax laws in the various jurisdictions in which the Company operates. Significant or unusual items, including those related to the change in U.S. tax law as well as other adjustments to accruals for tax uncertainties, are recognized in the quarter in which the related event occurs. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was signed into law. The CARES Act contains significant business tax provisions, including modifications to the rules limiting the deductibility of net operating losses (NOLs), expensing of qualified improvement property (QIP) and business interest in Internal Revenue Code Sections 172(a) and 163(j), respectively. The effects of the new legislation are recognized upon enactment. The Company did not recognize any significant impact to income tax expense for the six months ended December 31, 2020 relating to the CARES Act.

For the three months ended December 31, 2020 and 2019, the Company's effective tax rate was 22.3% and 22.3%, respectively. For the six months ended December 31, 2020 and 2019, the Company's effective tax rate was 22.3% and 22.4%, respectively. For the three and six months ended December 31, 2020 and 2019, the Company's effective tax rate exceeded the statutory federal income tax rate of 21% primarily due to the impact of U.S. state taxes. This increase in tax rate in both periods was partially offset by a windfall benefit generated by certain stock based compensation, and benefits from the foreign derived intangible income deduction, the research and development tax credit, and the impact of non-controlling interests in the LLC.

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Stock-Based Compensation

6 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

Stock-Based Compensation

The Company adopted a long term incentive plan which became effective on January 1, 2014, and reserves for issuance up to 1,700,000 shares of Malibu Boats, Inc. Class A Common Stock for the Company’s employees, consultants, members of its board of directors and other independent contractors at the discretion of the compensation committee. Incentive stock awards authorized under the Incentive Plan include unrestricted shares of Class A Common Stock, stock options, stock appreciation rights, restricted stock, restricted stock units, dividend equivalent awards and performance awards. As of December 31, 2020, 600,104 shares remain available for future issuance under the long term incentive plan.

On November 3, 2020, under the Incentive Plan, the Company granted approximately 33,000 restricted service based stock units and 25,000 restricted service based stock awards to key employees under the Incentive Plan. The grant date fair value of these awards was $3,145 based on a stock price of $54.47 per share on the date of grant. Approximately 58% of the awards vest ratably over three years and approximately 42% of the awards vest ratably over four years. Stock-based compensation expense attributable to the service based units and awards is amortized on a straight-line basis over the requisite service period.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 restricted stock awards with a performance condition. The number of shares that will ultimately be issued, if any, is based on the attainment of a specified amount of earnings during the fiscal year ending June 30, 2023. The maximum number of shares that can be issued if an elevated earnings target is met is approximately 28,000. The grant date fair value of the awards were estimated to be $1,002, based on a stock price of $54.47. Compensation costs associated with the performance awards are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

On November 3, 2020, under the Incentive Plan, the Company granted to key employees a target amount of approximately 18,000 stock awards with a market condition. The number of shares that will ultimately be issued, if any, is based on a total shareholder return ("TSR") computation that involves comparing the movement in the Company's stock price to movement in a market index from the grant date through November 6, 2023. The maximum number of shares that can be issued if an elevated TSR target is met is approximately 37,000. The grant date fair value of the awards were estimated to be $1,293, which is estimated using a Monte Carlo simulation. The Monte Carlo simulation model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the award grant and calculates the fair market value for the stock award. Compensation costs are recognized over the requisite service period based on probability of achievement in accordance with ASC Topic 718, Compensation—Stock Compensation.

The following is a summary of the changes in the Company's stock options for the six months ended December 31, 2020:

	Shares	Weighted Average Exercise Price/Share
Total outstanding options as of June 30, 2020	173,348	$	32.61
Options granted	—	—
Options exercised	(9,625)	31.14
Outstanding options as of December 31, 2020	163,723	32.70
Exercisable as of December 31, 2020	82,744	$	31.46

The following is a summary of the changes in non-vested restricted stock units and restricted stock awards for the six months ended December 31, 2020:

	Number of Restricted Stock Units and Restricted Stock Awards Outstanding	Weighted Average Grant Date Fair Value
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of June 30, 2020	277,696	$	35.43
Granted	134,044	54.41
Vested	(90,154)	32.10
Forfeited	(1,592)	36.63
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of December 31, 2020	319,994	$	44.31

Stock compensation expense attributable to the Company's share-based equity awards was $1,800 and $813 for the three months ended December 31, 2020 and 2019, respectively, and $2,611 and $1,490 for the six months ended December 31, 2020 and 2019. Stock compensation expense attributed to share-based equity awards issued under the Incentive Plan is recognized on a straight-line basis over the terms of the respective awards and is included in general and administrative expense in the Company's unaudited interim condensed consolidated statement of operations and comprehensive income. Awards vesting during the three and six months ended December 31, 2020 include 10,826 and 11,951 fully vested restricted stock units issued to non-employee directors for their service as directors for the Company.

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Net Earnings Per Share

6 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Net Earnings Per Share

Net Earnings Per Share

Basic net income per share of Class A Common Stock is computed by dividing net income attributable to the Company's earnings by the weighted average number of shares of Class A Common Stock outstanding during the period. The weighted average number of shares of Class A Common Stock outstanding used in computing basic net income per share includes fully vested restricted stock units awarded to directors that are entitled to participate in distributions to common shareholders through receipt of additional units of equivalent value to the dividends paid to Class A Common Stock holders.

Diluted net income per share of Class A Common Stock is computed similarly to basic net income per share except the weighted average shares outstanding are increased to include additional shares from the assumed exercise of any common stock equivalents using the treasury method, if dilutive. The LLC Units and non-qualified stock options are considered common stock equivalents for this purpose. The number of additional shares of Class A Common Stock related to these common stock equivalents and stock options are calculated using the treasury stock method.

Stock awards with a performance condition that are based on the attainment of a specified amount of earnings are only included in the computation of diluted earnings per share to the extent that the performance condition would be achieved based on the current amount of earnings, and only if the effect would be dilutive.

Stock awards with a market condition that are based on the performance of the Company's stock price in relation to a market index over a specified time period are only included in the computation of diluted earnings per share to the extent that the shares would be issued based on the current market price of the Company's stock in relation to the market index, and only if the effect would be dilutive.

Basic and diluted net income per share of Class A Common Stock has been computed as follows (in thousands, except share and per share amounts):

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Basic:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing basic net income per share:
Weighted-average Class A Common Stock	20,493,938		20,385,815		20,464,902		20,510,896
Weighted-average participating restricted stock units convertible into Class A Common Stock	223,421		205,426		219,742		199,785
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Basic net income per share	$	1.03	$	0.81	$	2.05	$	1.57
Diluted:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Restricted stock units granted to employees	153,918		81,661		159,058		81,394
Stock options granted to employees	42,361		4,404		43,834		588
Market performance awards granted to employees	59,264		24,167		59,264		24,167
Diluted weighted-average shares outstanding 1	20,972,902		20,701,473		20,946,800		20,816,830
Diluted net income per share	$	1.01	$	0.81	$	2.02	$	1.57

1 The Company excluded (i) 745,055 and 940,875 potentially dilutive shares from the calculation of diluted net income per share for the three months ended December 31, 2020 and 2019, respectively, and (ii) 733,805 and 1,042,509 potentially dilutive shares from the calculation of diluted net income per share for the six months ended December 31, 2020 and 2019, respectively, as these units would have been antidilutive.

The shares of Class B Common Stock do not share in the earnings or losses of Malibu Boats, Inc. and, therefore, not included in the calculation. Accordingly, basic and diluted net earnings per share of Class B Common Stock has not been presented.

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Commitment and Contingencies

6 Months Ended

Dec. 31, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Repurchase Commitments

In connection with its dealers’ wholesale floor plan financing of boats, the Company has entered into repurchase agreements with various lending institutions. The reserve methodology used to record an estimated expense and loss reserve in each accounting period is based upon an analysis of likely repurchases based on current field inventory and likelihood of repurchase. Subsequent to the inception of the repurchase commitment, the Company evaluates the likelihood of repurchase and adjusts the estimated loss reserve accordingly. When a potential loss reserve is recorded it is presented in accrued liabilities in the accompanying unaudited interim condensed consolidated balance sheet. If the Company were obligated to repurchase a significant number of units under any repurchase agreement, its business, operating results and financial condition could be adversely affected. The total amount financed under the floor financing programs with repurchase obligations was $180,634 and $161,356 as of December 31, 2020 and June 30, 2020, respectively.

Repurchases and subsequent sales are recorded as a revenue transaction. The net difference between the repurchase price and the resale price is recorded against the loss reserve and presented in cost of sales in the accompanying unaudited interim condensed consolidated statements of operations and comprehensive income. During the three and six months ended December 31, 2020, there were no repurchases and as of December 31, 2020, the Company has not been notified about any probable repossessions. Therefore, the Company did not carry a reserve for repurchases as of December 31, 2020 consistent with June 30, 2020.

The Company has collateralized receivables financing arrangements with a third-party floor plan financing provider

for European dealers. Under terms of these arrangements, the Company transfers the right to collect a trade receivable to the financing provider in exchange for cash but agrees to repurchase the receivable if the dealer defaults. Since the transfer of the receivable to the financing provider does not meet the conditions for a sale under ASC Topic 860, Transfers and Servicing, the Company continues to report the transferred trade receivable in other current assets with an offsetting balance recorded as a secured obligation in accrued expenses in the Company's unaudited condensed consolidated balance sheets. As of December 31, 2020 and June 30, 2020, the Company had financing receivables of $165 and $375, respectively, recorded in other current assets and accrued expenses related to these arrangements.

Contingencies

Product Liability

The Company is engaged in a business that exposes it to claims for product liability and warranty claims in the event the Company’s products actually or allegedly fail to perform as expected or the use of the Company’s products results, or is alleged to result, in property damage, personal injury or death. Although the Company maintains product and general liability insurance of the types and in the amounts that the Company believes are customary for the industry, the Company is not fully insured against all such potential claims. The Company may have the ability to refer claims to its suppliers and their insurers to pay the costs associated with any claims arising from the suppliers’ products. The Company’s insurance covers such claims that are not adequately covered by a supplier’s insurance and provides for excess secondary coverage above the limits provided by the Company’s suppliers.

The Company may experience legal claims in excess of its insurance coverage or claims that are not covered by insurance, either of which could adversely affect its business, financial condition and results of operations. Adverse determination of material product liability and warranty claims made against the Company could have a material adverse effect on its financial condition and harm its reputation. In addition, if any of the Company products are, or are alleged to be, defective, the Company may be required to participate in a recall of that product if the defect or alleged defect relates to safety. These and other claims that the Company faces could be costly to the Company and require substantial management attention. Refer to Note 9 for discussion of warranty claims. The Company insures against product liability claims and believes there are no material product liability claims as of December 31, 2020 that would not be covered by our insurance.

Legal Proceedings

On January 12, 2018, the Company filed suit against Skier’s Choice, Inc., or "Skier’s Choice," in the U.S. District Court for the Eastern District of Tennessee, seeking monetary and injunctive relief. The Company's complaint alleges Skier’s Choice’s infringement of three utility patents - U.S. Patent Nos. 9,260,161, 8,578,873, and 9,199,695 - related to wake surfing technology. Skier’s Choice denied liability arising from the causes of action alleged in the Company's complaint and filed counterclaims alleging invalidity of the asserted patents. On June 19, 2019, the Company filed a second action against Skier’s Choice in the U.S. District Court for the Eastern District of Tennessee, seeking monetary and injunctive relief.  The Company’s complaint alleges Skier’s Choice’s surf systems on its Moomba and Supra lines of boats infringe U.S. Patent No. 10,322,777, a patent related to wake surfing technology. Skier’s Choice denied liability arising from the causes of action alleged in the Company's complaint and filed counterclaims alleging invalidity of the asserted patents.  On June 27, 2019, Skier’s Choice filed a motion to consolidate these two actions, and to continue deadlines in the earlier case for nine months, which the Company opposed. On August 22, 2019, the motion for consolidation was referred by Judge Thomas Varlan to Magistrate Judge Bruce Guyton, and the two cases were stayed pending resolution of that motion. On November 27, 2019, Judge Guyton ordered the two cases to be consolidated.  On January 7, 2020, the consolidated cases were reassigned to Judge Jon McCalla.  On January 23, 2020, Judge McCalla issued a Scheduling Order, scheduling trial on the consolidated cases to begin on September 29, 2020. On July 23, 2020, the Company moved to dismiss its allegations of infringement of U.S. Patent No. 9,199,695, which Skier’s Choice opposed. On August 25, 2020, Judge McCalla issued a claim construction order and set a scheduling conference for August 27, 2020, for purposes of resetting the pretrial calendar and trial dates. On September 11, 2020, the Court issued a Scheduling Order resetting the trial for the consolidated cases to begin on January 25, 2021. On December 11, 2020, the Court issued an Order resetting the trial for the consolidated cases to begin on May 10, 2021. The Company intends to vigorously pursue this litigation to enforce its rights in its patented technology and believes that Skier’s Choice’s counterclaims are without merit.

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Segment Information

6 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Segment Information

Segment Information Effective December 31, 2020, the Company revised its segment reporting to account for its acquisition of Maverick Boat Group and conform to changes in its internal management reporting based on the Company’s boat manufacturing operations. The Company previously had three reportable segments, Malibu, Cobalt and Pursuit. The Company now aggregates Pursuit and Maverick Boat Group into one reportable segment as they have similar economic characteristics and qualitative factors. As a result, the Company continues to have three reportable segments, Malibu, Cobalt and Saltwater Fishing. The Malibu segment

participates in the manufacturing, distribution, marketing and sale of Malibu and Axis performance sports boats throughout the world. The Cobalt segment participates in the manufacturing, distribution, marketing and sale of Cobalt boats throughout the world. The Saltwater Fishing segment participates in the manufacturing, distribution, marketing and sale throughout the world of Pursuit boats and the Maverick Boat Group brand boats (Maverick, Cobia, Pathfinder and Hewes).

The following tables present financial information for the Company’s reportable segments for the three and six months ended December 31, 2020 and 2019, respectively, and the Company’s financial position at December 31, 2020 and June 30, 2020, respectively:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Income before provision for income taxes	$	17,572	$	5,189	$	5,734	$	28,495	$	35,127	$	9,965	$	11,808	$	56,900
	Three months ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Income before provision for income taxes	$	15,200	$	4,853	$	2,586	$	22,639	$	26,661	$	10,760	$	6,744	$	44,165

	As of December 31, 2020		As of June 30, 2020
Assets
Malibu	$	188,798	$	194,502
Cobalt	156,082		153,820
Saltwater Fishing	325,468		129,024
Total assets	$	670,348	$	477,346

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Organization, Basis of Presentation, and Summary of Significant Accounting Policies (Policies)

6 Months Ended

Dec. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim condensed financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and disclosures of results of operations, financial position and changes in cash flow in conformity with GAAP for complete financial statements. Such statements should be read in conjunction with the audited consolidated financial statements and notes thereto of Malibu Boats, Inc. and subsidiaries for the year ended June 30, 2020, included in the Company's Annual Report on Form 10-K. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Units and shares are presented as whole numbers while all dollar amounts are presented in thousands, unless otherwise noted.

Segment Information

Segment InformationEffective December 31, 2020, the Company revised its segment reporting to account for its acquisition of Maverick Boat Group and conform to changes in its internal management reporting based on the Company’s boat manufacturing operations. The Company previously had three reportable segments, Malibu, Cobalt and Pursuit. The Company now aggregates Pursuit and Maverick Boat Group into one reportable segment as they have similar economic characteristics and qualitative factors. As a result the Company continues to have three reportable segments, Malibu, Cobalt and Saltwater Fishing.

Principles of Consolidation

Principles of Consolidation

The accompanying unaudited interim condensed consolidated financial statements include the operations and accounts of the Company and all subsidiaries thereof. All intercompany balances and transactions have been eliminated upon consolidation.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In June 2016, the FASB issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and in November 2018 issued a subsequent amendment, ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses. ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 will replace today’s “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. ASU 2018-19 will affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope of this amendment that have the contractual right to receive cash. On July 1, 2020, the Company adopted this standard and the adoption did not have a material impact on the Company’s consolidated financial position, results of operations, equity or cash flows.

There are no other new accounting pronouncements that are expected to have a significant impact on the Company's consolidated financial statements and related disclosures.

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Revenue Recognition (Tables)

6 Months Ended

Dec. 31, 2020

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue

The following table disaggregates the Company's revenue by major product type and geography:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	105,687	$	46,932	$	39,423	$	192,042	$	199,681	$	90,337	$	75,826	$	365,844
Part and other sales	2,930		546		129		3,605		8,767		1,623		397		10,787
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Revenue by geography:
North America	$	98,242	$	45,196	$	36,841	$	180,279	$	194,160	$	89,149	$	72,591	$	355,900
International	10,375		2,282		2,711		15,368		14,288		2,811		3,632		20,731
Total revenue	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631

	Three Months Ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Consolidated		Malibu		Cobalt		Saltwater Fishing		Consolidated
Revenue by product:
Boat and trailer sales	$	94,350	$	48,579	$	33,715	$	176,644	$	176,433	$	97,879	$	69,521	$	343,833
Part and other sales	2,977		415		76		3,468		6,774		1,266		319		8,359
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Revenue by geography:
North America	$	89,643	$	46,822	$	33,114	$	169,579	$	168,560	$	95,580	$	65,365	$	329,505
International	7,684		2,172		677		10,533		14,647		3,565		4,475		22,687
Total revenue	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192

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Non-controlling Interest (Tables)

6 Months Ended

Dec. 31, 2020

Noncontrolling Interest [Abstract]

Non-controlling Interest

The ownership of Malibu Boats Holdings, LLC is summarized as follows:

	As of December 31, 2020			As of June 30, 2020
	Units	Ownership %		Units	Ownership %
Non-controlling LLC Unit holders ownership in Malibu Boats Holdings, LLC	691,305	3.2	%	730,652	3.4	%
Malibu Boats, Inc. ownership in Malibu Boats Holdings, LLC	20,753,463	96.8		20,595,969	96.6
	21,444,768	100.0	%	21,326,621	100.0	%

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Acquisitions (Tables)

6 Months Ended

Dec. 31, 2020

Business Combinations [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table summarizes the preliminary purchase price allocation based on the estimated fair values of the assets acquired and liabilities assumed at the acquisition date:

Consideration:
Cash consideration paid	$	150,675
Recognized preliminary amounts of identifiable assets acquired and (liabilities assumed), at fair value:
Cash	$	248
Accounts receivable	3,204
Inventories	7,756
Other current assets	194
Property, plant and equipment	22,618
Identifiable intangible assets	102,600
Other assets	4,410
Current liabilities	(6,611)
Deferred tax liabilities	(28,528)
Other liabilities	(4,405)
Fair value of assets acquired and liabilities assumed	101,486
Goodwill	49,189
Total purchase price	$	150,675

Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination

The preliminary fair value estimates for the Company's identifiable intangible assets acquired as part of the acquisition are as follows:

	Estimates of Fair Value		Estimated Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	47,900	20
Total definite-lived intangibles	47,900
Indefinite-lived intangible:
Trade name	54,700
Total intangible assets	$	102,600

Business Acquisition, Pro Forma Information

The following unaudited pro forma consolidated results of operations for the three and six months ended December 31, 2020 and 2019, assumes that the acquisition of Maverick Boat Group occurred as of July 1, 2019. The unaudited interim pro forma financial information combines historical results of Malibu and Maverick Boat Group, with adjustments for depreciation and amortization attributable to preliminary fair value estimates on acquired tangible and intangible assets for the respective periods. Non-recurring pro forma adjustments associated with the fair value step up of inventory were included in the reported pro forma cost of sales and earnings. The unaudited interim pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal year 2020 or the results that may occur in the future:

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Net sales	$	224,348	$	211,113	$	432,651	$	417,001
Net income	23,287		19,102		46,500		36,200
Net income attributable to Malibu Boats, Inc.	22,335		18,179		44,572		34,457
Basic earnings per share	$	1.08	$	0.88	$	2.16	$	1.66
Diluted earnings per share	$	1.06	$	0.88	$	2.13	$	1.66

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Inventories (Tables)

6 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Inventories, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Raw materials	$	68,078	$	52,530
Work in progress	17,973		10,778
Finished goods	9,950		9,638
Total inventories	$	96,001	$	72,946

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Property, Plant and Equipment (Tables)

6 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment, net consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Land	$	3,960	$	2,540
Building and leasehold improvements	73,437		54,318
Machinery and equipment	61,475		55,831
Furniture and fixtures	7,762		7,031
Construction in process	14,214		10,470
	160,848		130,190
Less: Accumulated depreciation	(39,960)		(35,880)
Property, plant and equipment, net	$	120,888	$	94,310

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Changes in the carrying amount of goodwill for the six months ended December 31, 2020 were as follows:

Goodwill as of June 30, 2020	$	51,273
Addition related to the acquisition of Maverick Boat Group	49,189
Effect of foreign currency changes on goodwill	753
Goodwill as of December 31, 2020	$	101,215

Schedule of Acquired Finite-Lived Intangible Assets by Major Class

The components of other intangible assets were as follows:

	As of December 31, 2020		As of June 30, 2020		Estimated Useful Life (in years)	Weighted Average Remaining Useful Life (in years)
Definite-lived intangibles:
Dealer relationships	$	159,459	$	111,293	8-20	18.1
Patent	3,986		3,986		12-15	11.5
Trade name	24,667		24,667		15	1.1
Non-compete agreement	54		48		10	3.8
Total	188,166		139,994
Less: Accumulated amortization	(66,760)		(63,602)
Total definite-lived intangible assets, net	121,406		76,392
Indefinite-lived intangible:
Trade name	118,200		63,500
Total other intangible assets, net	$	239,606	$	139,892

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

The estimated future amortization of definite-lived intangible assets is as follows:

Fiscal years ending June 30:		Amount
	Remainder of 2021	$	4,206
	2022	6,967
	2023	6,830
	2024	6,830
	2025	6,826
	2026 and thereafter	89,747
		$	121,406

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Accrued Expenses (Tables)

6 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Schedule of Accrued Expenses

Accrued expenses consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Warranties	$	31,046	$	27,500
Dealer incentives	11,685		7,777
Accrued compensation	11,826		9,885
Current operating lease liabilities	1,977		2,006
Accrued legal and professional fees	2,114		1,055
Customer deposits	5,194		1,059
Other accrued expenses	1,875		1,203
Total accrued expenses	$	65,717	$	50,485

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Product Warranties (Tables)

6 Months Ended

Dec. 31, 2020

Product Warranties Disclosures [Abstract]

Product Warranties

Changes in the Company’s product warranty liability, which is included in accrued expenses on the unaudited interim condensed consolidated balance sheets, were as follows: 

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Beginning balance	$	29,077	$	25,034	$	27,500	$	23,820
Add: Warranty expense	4,791		5,196		9,646		9,102
Additions for acquisitions	883		—		883		—
Less: Warranty claims paid	(3,705)		(3,520)		(6,983)		(6,212)
Ending balance	$	31,046	$	26,710	$	31,046	$	26,710

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Financing (Tables)

6 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Schedule of Debt

Outstanding debt consisted of the following:

	As of December 31, 2020		As of June 30, 2020
Term loan	$	100,000	$	75,000
Revolving credit loan	65,000		8,800
Less unamortized debt issuance costs	(1,393)		(961)
Total debt	163,607		82,839
Less current maturities	(1,250)		—
Long-term debt less current maturities	$	162,357	$	82,839

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Leases (Tables)

6 Months Ended

Dec. 31, 2020

Leases [Abstract]

Schedule of Assets And Liabilities, Lessee

Other information concerning the Company's operating leases accounted for under ASC Topic 842, Leases is as follows (in thousands):

Classification		As of December 31, 2020		As of June 30, 2020
Assets
Right-of-use assets	Other assets	$	13,473	$	14,315
Liabilities
Current operating lease liabilities	Accrued expenses	$	1,977	$	2,006
Long-term operating lease liabilities	Other liabilities	13,162		14,013
Total lease liabilities		$	15,139	$	16,019

Lease, Cost

Classification		Three Months Ended December 31, 2020		Three months ended December 31, 2019		Six Months Ended December 31, 2020		Six Months Ended December 31, 2019
Operating lease costs (1)	Cost of sales	$	504	$	473	$	1,012	$	950
	Selling and marketing, and general and administrative	208		220		422		443
Sublease income	Other income, net	10		9		19		19
Cash paid for amounts included in the measurement of operating lease liabilities	Cash flows from operating activities	652		655		1,309		1,302

(1) Includes short-term leases, which are insignificant, and are not included in the lease liability.

Lessee, Operating Lease, Liability, Maturity

Future annual minimum lease payments for the following fiscal years as of December 31, 2020 are as follows:

	Amount
Remainder of 2021	$	1,268
2022	2,433
2023	2,484
2024	2,608
2025	2,314
2026 and thereafter	6,015
Total	17,122
Less imputed interest	(1,983)
Present value of lease liabilities	$	15,139

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Tax Receivable Agreement Liability (Tables)

6 Months Ended

Dec. 31, 2020

Tax Receivable Agreement [Abstract]

Tax Receivable Agreement Liability

The following table reflects the changes to the Company's tax receivable agreement liability:

	As of December 31, 2020		As of June 30, 2020
Payable pursuant to tax receivable agreement	$	49,665	$	53,754
Additions (reductions) to tax receivable agreement:
Exchange of LLC Units for Class A Common Stock	543		1,041
Adjustment for change in estimated tax rate	—		(1,672)
Payments under tax receivable agreement	—		(3,458)
	50,208		49,665
Less current portion under tax receivable agreement	(3,589)		(3,589)
Payable pursuant to tax receivable agreement, less current portion	$	46,619	$	46,076

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Stock-Based Compensation (Tables)

6 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Share-Based Compensation, Stock Options, Activity

The following is a summary of the changes in the Company's stock options for the six months ended December 31, 2020:

	Shares	Weighted Average Exercise Price/Share
Total outstanding options as of June 30, 2020	173,348	$	32.61
Options granted	—	—
Options exercised	(9,625)	31.14
Outstanding options as of December 31, 2020	163,723	32.70
Exercisable as of December 31, 2020	82,744	$	31.46

Schedule of Summary of the Changes in Non-vested Restricted

The following is a summary of the changes in non-vested restricted stock units and restricted stock awards for the six months ended December 31, 2020:

	Number of Restricted Stock Units and Restricted Stock Awards Outstanding	Weighted Average Grant Date Fair Value
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of June 30, 2020	277,696	$	35.43
Granted	134,044	54.41
Vested	(90,154)	32.10
Forfeited	(1,592)	36.63
Total Non-vested Restricted Stock Units and Restricted Stock Awards as of December 31, 2020	319,994	$	44.31

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Net Earnings Per Share (Tables)

6 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Income Per Share

Basic and diluted net income per share of Class A Common Stock has been computed as follows (in thousands, except share and per share amounts):

	Three Months Ended December 31,				Six Months Ended December 31,
	2020		2019		2020		2019
Basic:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing basic net income per share:
Weighted-average Class A Common Stock	20,493,938		20,385,815		20,464,902		20,510,896
Weighted-average participating restricted stock units convertible into Class A Common Stock	223,421		205,426		219,742		199,785
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Basic net income per share	$	1.03	$	0.81	$	2.05	$	1.57
Diluted:
Net income attributable to Malibu Boats, Inc.	$	21,225	$	16,722	$	42,318	$	32,581
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding	20,717,359		20,591,241		20,684,644		20,710,681
Restricted stock units granted to employees	153,918		81,661		159,058		81,394
Stock options granted to employees	42,361		4,404		43,834		588
Market performance awards granted to employees	59,264		24,167		59,264		24,167
Diluted weighted-average shares outstanding 1	20,972,902		20,701,473		20,946,800		20,816,830
Diluted net income per share	$	1.01	$	0.81	$	2.02	$	1.57

1 The Company excluded (i) 745,055 and 940,875 potentially dilutive shares from the calculation of diluted net income per share for the three months ended December 31, 2020 and 2019, respectively, and (ii) 733,805 and 1,042,509 potentially dilutive shares from the calculation of diluted net income per share for the six months ended December 31, 2020 and 2019, respectively, as these units would have been antidilutive.

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Segment Information (Tables)

6 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, By Segment

The following tables present financial information for the Company’s reportable segments for the three and six months ended December 31, 2020 and 2019, respectively, and the Company’s financial position at December 31, 2020 and June 30, 2020, respectively:

	Three Months Ended December 31, 2020								Six Months Ended December 31, 2020
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	108,617	$	47,478	$	39,552	$	195,647	$	208,448	$	91,960	$	76,223	$	376,631
Income before provision for income taxes	$	17,572	$	5,189	$	5,734	$	28,495	$	35,127	$	9,965	$	11,808	$	56,900
	Three months ended December 31, 2019								Six Months Ended December 31, 2019
	Malibu		Cobalt		Saltwater Fishing		Total		Malibu		Cobalt		Saltwater Fishing		Total
Net sales	$	97,327	$	48,994	$	33,791	$	180,112	$	183,207	$	99,145	$	69,840	$	352,192
Income before provision for income taxes	$	15,200	$	4,853	$	2,586	$	22,639	$	26,661	$	10,760	$	6,744	$	44,165

	As of December 31, 2020		As of June 30, 2020
Assets
Malibu	$	188,798	$	194,502
Cobalt	156,082		153,820
Saltwater Fishing	325,468		129,024
Total assets	$	670,348	$	477,346

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Organization, Basis of Presentation, and Summary of Significant Accounting Policies (Details)			6 Months Ended
	Dec. 31, 2020 USD ($) brand facility	Dec. 30, 2020 USD ($) segment	Dec. 31, 2020 USD ($) segment brand facility	Dec. 29, 2020 USD ($)	Jun. 30, 2020 USD ($)
Line of Credit Facility [Line Items]
Number of reportable segments | segment		3	3
Term loan	$ 100,000,000		$ 100,000,000		$ 75,000,000
Maverick Boat Group, Inc.
Line of Credit Facility [Line Items]
Number of brands acquired | brand	4		4
Total purchase price	$ 150,675,000
Number of manufacturing facilities | facility	2		2
Revolving Credit Facility
Line of Credit Facility [Line Items]
Proceeds from long-term borrowings	$ 90,000,000
Increase in maximum borrowing capacity		$ 50,000,000
Maximum borrowing capacity	$ 170,000,000	170,000,000	$ 170,000,000	$ 120,000,000
Incremental Term Loan | Secured Debt
Line of Credit Facility [Line Items]
Term loan		$ 25,000,000
Incremental Term Loan | Secured Debt | Interest Rate through December 31, 2022
Line of Credit Facility [Line Items]
Stated interest rate (as a percent)		5.00%
Incremental Term Loan | Secured Debt | Interest Rate from January 1, 2023 through June 30, 2024
Line of Credit Facility [Line Items]
Stated interest rate (as a percent)		7.50%
Incremental Term Loan | Revolving Credit Facility
Line of Credit Facility [Line Items]
Increase in maximum borrowing capacity		$ 50,000,000
Maverick Boat Group, Inc. and Pursuit
Line of Credit Facility [Line Items]
Number of reportable segments after aggregation | segment			1

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Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue [Line Items]
Net sales	$ 195,647	$ 180,112	$ 376,631	$ 352,192
North America
Disaggregation of Revenue [Line Items]
Net sales	180,279	169,579	355,900	329,505
International
Disaggregation of Revenue [Line Items]
Net sales	15,368	10,533	20,731	22,687
Boat and trailer sales
Disaggregation of Revenue [Line Items]
Net sales	192,042	176,644	365,844	343,833
Part and other sales
Disaggregation of Revenue [Line Items]
Net sales	3,605	3,468	10,787	8,359
Malibu
Disaggregation of Revenue [Line Items]
Net sales	108,617	97,327	208,448	183,207
Malibu | North America
Disaggregation of Revenue [Line Items]
Net sales	98,242	89,643	194,160	168,560
Malibu | International
Disaggregation of Revenue [Line Items]
Net sales	10,375	7,684	14,288	14,647
Malibu | Boat and trailer sales
Disaggregation of Revenue [Line Items]
Net sales	105,687	94,350	199,681	176,433
Malibu | Part and other sales
Disaggregation of Revenue [Line Items]
Net sales	2,930	2,977	8,767	6,774
Cobalt
Disaggregation of Revenue [Line Items]
Net sales	47,478	48,994	91,960	99,145
Cobalt | North America
Disaggregation of Revenue [Line Items]
Net sales	45,196	46,822	89,149	95,580
Cobalt | International
Disaggregation of Revenue [Line Items]
Net sales	2,282	2,172	2,811	3,565
Cobalt | Boat and trailer sales
Disaggregation of Revenue [Line Items]
Net sales	46,932	48,579	90,337	97,879
Cobalt | Part and other sales
Disaggregation of Revenue [Line Items]
Net sales	546	415	1,623	1,266
Saltwater Fishing
Disaggregation of Revenue [Line Items]
Net sales	39,552	33,791	76,223	69,840
Saltwater Fishing | North America
Disaggregation of Revenue [Line Items]
Net sales	36,841	33,114	72,591	65,365
Saltwater Fishing | International
Disaggregation of Revenue [Line Items]
Net sales	2,711	677	3,632	4,475
Saltwater Fishing | Boat and trailer sales
Disaggregation of Revenue [Line Items]
Net sales	39,423	33,715	75,826	69,521
Saltwater Fishing | Part and other sales
Disaggregation of Revenue [Line Items]
Net sales	$ 129	$ 76	$ 397	$ 319

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Non-controlling Interest - Ownership (Details) - shares	Dec. 31, 2020	Jun. 30, 2020
Class of Stock [Line Items]
Units (in shares)	21,444,768	21,326,621
Malibu Boats Holdings LLC
Class of Stock [Line Items]
Ownership %	100.00%	100.00%
Non-controlling Interest in LLC
Class of Stock [Line Items]
Units (in shares)	691,305	730,652
Non-controlling Interest in LLC | Malibu Boats Holdings LLC
Class of Stock [Line Items]
Ownership %	3.20%	3.40%
Parent
Class of Stock [Line Items]
Units (in shares)	20,753,463	20,595,969
Parent | Malibu Boats Holdings LLC
Class of Stock [Line Items]
Ownership %	96.80%	96.60%

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Non-controlling Interest - Narrative (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2020
Non-controlling Interest in LLC
Noncontrolling Interest [Line Items]
Tax distributions payable to non-controlling LLC Unit holders	$ 495		$ 104
Tax distributions paid to non-controlling LLC Unit holders	$ 553	$ 969
Class A Common Stock
Noncontrolling Interest [Line Items]
Issuance LLC Units (in shares)	167,159
Treasury Stock, Common
Noncontrolling Interest [Line Items]
Treasury stock, shares, retired (in shares)	9,665

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Acquisitions - Narrative (Details) - USD ($)		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2020	Jun. 30, 2020
Business Acquisition [Line Items]
Goodwill	$ 101,215,000	$ 101,215,000	$ 51,273,000
Maverick Boat Group, Inc.
Business Acquisition [Line Items]
Total purchase price	$ 150,675,000
Acquired finite-lived intangible assets, weighted average useful life (in years)	20 years
Goodwill	$ 49,189,000	49,189,000
Acquisition related costs		$ 2,577,000
Maverick Boat Group, Inc. | Dealer relationships
Business Acquisition [Line Items]
Acquired finite-lived intangible assets, weighted average useful life (in years)	20 years

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Acquisitions - Purchase Price Allocation by Assets Acquired and Liabilities Assumed (Details) - USD ($)	Dec. 31, 2020	Jun. 30, 2020
Business Acquisition [Line Items]
Goodwill	$ 101,215,000	$ 51,273,000
Maverick Boat Group, Inc.
Business Acquisition [Line Items]
Cash consideration paid	150,675,000
Cash	248,000
Accounts receivable	3,204,000
Inventories	7,756,000
Other current assets	194,000
Property, plant and equipment	22,618,000
Identifiable intangible assets	102,600,000
Other assets	4,410,000
Current liabilities	(6,611,000)
Deferred tax liabilities	(28,528,000)
Other liabilities	(4,405,000)
Fair value of assets acquired and liabilities assumed	101,486,000
Goodwill	49,189,000
Total purchase price	$ 150,675,000

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Acquisitions - Fair Value of Identifiable Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Business Acquisition [Line Items]
Total intangible assets	$ 239,606	$ 139,892
Maverick Boat Group, Inc.
Business Acquisition [Line Items]
Definite-lived intangibles	$ 47,900
Acquired finite-lived intangible assets, weighted average useful life (in years)	20 years
Total intangible assets	$ 102,600
Maverick Boat Group, Inc. | Trade name
Business Acquisition [Line Items]
Indefinite-lived intangible assets	54,700
Maverick Boat Group, Inc. | Dealer relationships
Business Acquisition [Line Items]
Definite-lived intangibles	$ 47,900
Acquired finite-lived intangible assets, weighted average useful life (in years)	20 years

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Acquisitions - Pro Forma Information (Details) - Maverick Boat Group, Inc. - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Net sales	$ 224,348	$ 211,113	$ 432,651	$ 417,001
Net income	23,287	19,102	46,500	36,200
Net income attributable to Malibu Boats, Inc.	$ 22,335	$ 18,179	$ 44,572	$ 34,457
Basic earnings per share (in USD per share)	$ 1.08	$ 0.88	$ 2.16	$ 1.66
Diluted earnings per share (in USD per share)	$ 1.06	$ 0.88	$ 2.13	$ 1.66

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Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Inventory Disclosure [Abstract]
Raw materials	$ 68,078	$ 52,530
Work in progress	17,973	10,778
Finished goods	9,950	9,638
Total inventories	$ 96,001	$ 72,946

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Property, Plant and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2020
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 160,848		$ 160,848		$ 130,190
Less: Accumulated depreciation	(39,960)		(39,960)		(35,880)
Property, plant and equipment, net	120,888		120,888		94,310
Depreciation expense	3,599	$ 3,005	7,085	$ 6,102
Land
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	3,960		3,960		2,540
Building and leasehold improvements
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	73,437		73,437		54,318
Machinery and equipment
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	61,475		61,475		55,831
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	7,762		7,762		7,031
Construction in process
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 14,214		$ 14,214		$ 10,470

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Goodwill and Other Intangible Assets - Carrying Amount of Goodwill (Details) $ in Thousands	6 Months Ended
	Dec. 31, 2020 USD ($)
Goodwill [Roll Forward]
Goodwill as of June 30, 2020	$ 51,273
Addition related to the acquisition of Maverick Boat Group	49,189
Effect of foreign currency changes on goodwill	753
Goodwill as of December 31, 2020	$ 101,215

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Goodwill and Other Intangible Assets - Other Intangible Assets (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2020	Jun. 30, 2020
Goodwill [Line Items]
Gross carrying amount	$ 188,166	$ 139,994
Less: Accumulated amortization	(66,760)	(63,602)
Total definite-lived intangible assets, net	121,406	76,392
Total other intangible assets, net	239,606	139,892
Trade name
Goodwill [Line Items]
Trade name	118,200	63,500
Dealer relationships
Goodwill [Line Items]
Gross carrying amount	$ 159,459	111,293
Weighted Average Remaining Useful Life (in years)	18 years 1 month 6 days
Dealer relationships | Minimum
Goodwill [Line Items]
Estimated Useful Life (in years)	8 years
Dealer relationships | Maximum
Goodwill [Line Items]
Estimated Useful Life (in years)	20 years
Patent
Goodwill [Line Items]
Gross carrying amount	$ 3,986	3,986
Weighted Average Remaining Useful Life (in years)	11 years 6 months
Patent | Minimum
Goodwill [Line Items]
Estimated Useful Life (in years)	12 years
Patent | Maximum
Goodwill [Line Items]
Estimated Useful Life (in years)	15 years
Trade name
Goodwill [Line Items]
Gross carrying amount	$ 24,667	24,667
Estimated Useful Life (in years)	15 years
Weighted Average Remaining Useful Life (in years)	1 year 1 month 6 days
Non-compete agreement
Goodwill [Line Items]
Gross carrying amount	$ 54	$ 48
Estimated Useful Life (in years)	10 years
Weighted Average Remaining Useful Life (in years)	3 years 9 months 18 days

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Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible assets	$ 1,524	$ 1,537	$ 3,048	$ 3,121

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Goodwill and Other Intangible Assets - Future Amortization (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2021	$ 4,206
2022	6,967
2023	6,830
2024	6,830
2025	6,826
2026 and thereafter	89,747
Total definite-lived intangible assets, net	$ 121,406	$ 76,392

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Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Payables and Accruals [Abstract]
Warranties	$ 31,046	$ 27,500
Dealer incentives	11,685	7,777
Accrued compensation	11,826	9,885
Current operating lease liabilities	1,977	2,006
Accrued legal and professional fees	2,114	1,055
Customer deposits	5,194	1,059
Other accrued expenses	1,875	1,203
Total accrued expenses	$ 65,717	$ 50,485

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Product Warranties (Details) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($) hour	Dec. 31, 2019 USD ($)	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2016	Jun. 30, 2015
Product Warranty Liability [Line Items]
Standard product warranty, hours (up to) | hour			500
Movement in Standard Product Warranty Accrual [Roll Forward]
Beginning balance	$ 29,077	$ 25,034	$ 27,500	$ 23,820
Add: Warranty expense	4,791	5,196	9,646	9,102
Additions for acquisitions	883	0	883	0
Less: Warranty claims paid	(3,705)	(3,520)	(6,983)	(6,212)
Ending balance	$ 31,046	$ 26,710	$ 31,046	$ 26,710
Malibu, Axis and Cobalt Brand Boats
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)			5 years
Malibu and Axis Brand Boats
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)			5 years
Gelcoat warranty, period (up to)			1 year
Malibu Brand Boats
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)							5 years	3 years
Axis Boats
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)							5 years	2 years
Cobalt
Product Warranty Liability [Line Items]
Structural warranty, period (up to)			10 years
Bow-to-stern warranty on all components			5 years		5 years	3 years
Gelcoat warranty, period (up to)			3 years
Maverick, Pathfinder, and Hewes Brand Boats
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)			5 years
Bow-to-stern warranty on all components			1 year
Saltwater Fishing
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)			5 years
Bow-to-stern warranty on all components			2 years
Cobia
Product Warranty Liability [Line Items]
Standard product warranty, period (up to)			10 years
Bow-to-stern warranty on all components			3 years

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Financing - Outstanding Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Debt Disclosure [Abstract]
Term loan	$ 100,000	$ 75,000
Revolving credit loan	65,000	8,800
Less unamortized debt issuance costs	(1,393)	(961)
Total debt	163,607	82,839
Less current maturities	(1,250)	0
Long-term debt	$ 162,357	$ 82,839

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Financing - Narrative (Details) - USD ($)					3 Months Ended	6 Months Ended		12 Months Ended
	Mar. 31, 2022	Dec. 30, 2020	Aug. 24, 2017	Jul. 01, 2015	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2018	Dec. 29, 2020	Jun. 30, 2020	Jun. 30, 2017
Line of Credit Facility [Line Items]
Long-term debt						$ 163,607,000				$ 82,839,000
Revolving credit loan						65,000,000				8,800,000
Term loan						100,000,000				75,000,000
Current maturities of long-term obligations						1,250,000				0
Debt issuance costs						1,393,000				$ 961,000
Repayments of debt						8,800,000	$ 20,000,000
Derivative, term of contract				5 years
Fixed quarterly interest rate (as a percent)				1.52%
Derivative notional amount				$ 39,250,000
Outstanding balance (equal to) (as a percent)				50.00%
Derivative, loss on derivative					$ 20,000		$ 58,000
Revolving Credit Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity		$ 170,000,000				170,000,000			$ 120,000,000
Increase in maximum borrowing capacity		50,000,000
Credit Agreement
Line of Credit Facility [Line Items]
Long-term debt						100,000,000
Outstanding letters of credit						1,234,000
Purchase of stock (up to)						3,000,000
Share repurchase (up to)						$ 35,000,000
Period of permitted share repurchases						1 year
Dividend and distributions (up to)						$ 10,000,000
Deferred finance costs											$ 2,074,000
Debt issuance costs						671,000
Credit Agreement | Long-term Debt
Line of Credit Facility [Line Items]
Repayments of debt			$ 50,000,000
Write off of deferred debt issuance cost								$ 829,000
Credit Agreement | Long-term Debt | Forecast
Line of Credit Facility [Line Items]
Debt instrument, periodic payment	$ 3,000,000
Credit Agreement | Revolving Credit Facility
Line of Credit Facility [Line Items]
Revolving credit loan						65,000,000
Available borrowing capacity						$ 103,766,000
Stated interest rate (as a percent)						1.39%
Credit Agreement | Revolving Credit Facility | Minimum
Line of Credit Facility [Line Items]
Line of credit facility, unused capacity, commitment fee rate (as a percent)						0.20%
Credit Agreement | Revolving Credit Facility | Maximum
Line of Credit Facility [Line Items]
Line of credit facility, unused capacity, commitment fee rate (as a percent)						0.40%
Credit Agreement | Revolving Credit Facility | Federal Funds
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						0.50%
Credit Agreement | Revolving Credit Facility | Base Rate
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						1.00%
Credit Agreement | Revolving Credit Facility | Base Rate | Minimum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						0.25%
Credit Agreement | Revolving Credit Facility | Base Rate | Maximum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						1.25%
Credit Agreement | Revolving Credit Facility | LIBOR | Minimum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						1.25%
Credit Agreement | Revolving Credit Facility | LIBOR | Maximum
Line of Credit Facility [Line Items]
Debt instrument, basis spread on variable rate (as a percent)						2.25%
Third Amendment
Line of Credit Facility [Line Items]
Deferred finance costs						$ 638,000
Incremental Term Loan | Secured Debt
Line of Credit Facility [Line Items]
Term loan		$ 25,000,000
Current maturities of long-term obligations						$ 1,250,000
Incremental Term Loan | Secured Debt | Interest Rate through December 31, 2022
Line of Credit Facility [Line Items]
Stated interest rate (as a percent)		5.00%
Incremental Term Loan | Secured Debt | Interest Rate from January 1, 2023 through June 30, 2024
Line of Credit Facility [Line Items]
Stated interest rate (as a percent)		7.50%
Incremental Term Loan | Revolving Credit Facility
Line of Credit Facility [Line Items]
Increase in maximum borrowing capacity		$ 50,000,000
Existing Term Loans | Secured Debt
Line of Credit Facility [Line Items]
Term loan		$ 75,000,000

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Leases - Narrative (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020	Dec. 31, 2019	Jul. 01, 2019
Leases [Abstract]
Operating lease, right-of-use asset	$ 13,473	$ 14,315		$ 16,142
Weighted average remaining lease term (in years)	6 years 11 months 4 days		7 years 8 months 23 days
Weighted average discount rate (as a percent)	3.65%		3.65%

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Leases - Schedule of Expense, Assets and Liabilities, Lessee (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2020	Jul. 01, 2019
Assets
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssetsNoncurrent		us-gaap:OtherAssetsNoncurrent		us-gaap:OtherAssetsNoncurrent
Right-of-use assets	$ 13,473		$ 13,473		$ 14,315	$ 16,142
Liabilities
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:AccruedLiabilitiesCurrent		us-gaap:AccruedLiabilitiesCurrent		us-gaap:AccruedLiabilitiesCurrent
Current operating lease liabilities	$ 1,977		$ 1,977		$ 2,006
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesNoncurrent		us-gaap:OtherLiabilitiesNoncurrent		us-gaap:OtherLiabilitiesNoncurrent
Long-term operating lease liabilities	$ 13,162		$ 13,162		$ 14,013
Total lease liabilities	15,139		15,139		$ 16,019
Cash paid for amounts included in the measurement of operating lease liabilities	652	$ 655	1,309	$ 1,302
Cost of sales
Liabilities
Operating lease costs	504	473	1,012	950
Selling and marketing, and general and administrative
Liabilities
Operating lease costs	208	220	422	443
Other income, net
Liabilities
Sublease income	$ 10	$ 9	$ 19	$ 19

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Leases - Schedule of Operating Lease Payments (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 30, 2020
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
Remainder of 2021	$ 1,268
2022	2,433
2023	2,484
2024	2,608
2025	2,314
2026 and thereafter	6,015
Total	17,122
Less imputed interest	(1,983)
Present value of lease liabilities	$ 15,139	$ 16,019

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Tax Receivable Agreement Liability - Narrative (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2020	Jun. 30, 2020
Tax Receivable Agreement [Abstract]
Tax receivable agreement, proportion of realized cash saving in tax to pass through (as a percent)	85.00%
Investment in subsidiaries	$ 112,220	$ 111,511
Period of next annual payment (in days)	75 days

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Tax Receivable Agreement Liability - Schedule of Tax Agreement Liability (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Dec. 31, 2020	Jun. 30, 2020	Dec. 31, 2020	Jun. 30, 2020
Tax Receivable Agreement [Roll Forward]
Payable pursuant to tax receivable agreement	$ 49,665	$ 53,754
Additions (reductions) to tax receivable agreement:
Payments under tax receivable agreement	0	(3,458)
Payable Pursuant To Tax Receivable Agreement	49,665	53,754	$ 50,208	$ 49,665
Less current portion under tax receivable agreement			(3,589)	(3,589)
Payable pursuant to tax receivable agreement, less current portion			$ 46,619	$ 46,076
Exchange of LLC Units for Class A Shares
Additions (reductions) to tax receivable agreement:
Exchange of LLC Units for Class A Common Stock	543	1,041
Adjustment to tax receivable agreement liability	$ 0	$ (1,672)

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Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2020
Income Tax Disclosure [Abstract]
Deferred tax assets, valuation allowance	$ 14,693		$ 14,693		$ 14,582
Tax credit carryforwards, foreign	$ 580		$ 580		$ 580
Effective tax rate (as a percent)	22.30%	22.30%	22.30%	22.40%

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Stock-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		6 Months Ended
	Nov. 03, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock compensation expense		$ 1,800	$ 813	$ 2,611	$ 1,490
Restricted Stock Units (RSUs) | Non-Employee Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vested (in shares)		10,826		11,951
Restricted Stock Units and Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)				134,044
Vested (in shares)				90,154
Long-Term Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares reserved for issuance in the Long-Term Incentive Plan (in shares)						1,700,000
Remaining shares available for future issuance (in shares)		600,104		600,104
Long-Term Incentive Plan | Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	33,000
Long-Term Incentive Plan | Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	25,000
Long-Term Incentive Plan | Restricted Stock Units and Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based, incentive stock awards, granted	$ 3,145
Share price (in USD per share)	$ 54.47
Long-Term Incentive Plan | Restricted Stock Units and Restricted Stock Awards | Period one
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock vesting percentage	58.00%
Restricted stock vesting period	3 years
Long-Term Incentive Plan | Restricted Stock Units and Restricted Stock Awards | Period two
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock vesting percentage	42.00%
Restricted stock vesting period	4 years
Long-Term Incentive Plan | Performance Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	18,000
Share-based, incentive stock awards, granted	$ 1,002
Share price (in USD per share)	$ 54.47
Maximum number of shares available for issue if performance target is met (in shares)	28,000
Long-Term Incentive Plan | Stock Awards With Market Condition
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Grants in period (in shares)	18,000
Share-based, incentive stock awards, granted	$ 1,293
Maximum number of shares available for issue if performance target is met (in shares)	37,000

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Stock-Based Compensation - Stock Options (Details)	6 Months Ended
	Dec. 31, 2020 $ / shares shares
Shares
Outstanding options at beginning of period (in shares) | shares	173,348
Options granted (in shares) | shares	0
Options exercised (in shares) | shares	(9,625)
Outstanding options at end of period (in shares) | shares	163,723
Weighted Average Exercise Price/Share
Outstanding options at beginning of period (in dollars per share) | $ / shares	$ 32.61
Options granted (in dollars per share) | $ / shares	0
Options exercised (in dollars per share) | $ / shares	31.14
Outstanding options at end of period (in dollars per share) | $ / shares	$ 32.70
Exercisable at end of period (in shares) | shares	82,744
Exercisable at end of period (in dollars per share) | $ / shares	$ 31.46

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Stock-Based Compensation - Summary of Changes in Non-vested Restricted Shares (Details) - Restricted Stock Units and Restricted Stock Awards	6 Months Ended
	Dec. 31, 2020 $ / shares shares
Number of Restricted Stock Units and Restricted Stock Awards Outstanding
Total Non-vested Restricted Stock Units and Restricted Stock Awards at beginning of period (in shares) | shares	277,696
Granted (in shares) | shares	134,044
Vested (in shares) | shares	(90,154)
Forfeited (in shares) | shares	(1,592)
Total Non-vested Restricted Stock Units and Restricted Stock Awards at end of period (in shares) | shares	319,994
Weighted Average Grant Date Fair Value
Total Non-vested Restricted Stock Units and Restricted Stock Awards at beginning of period (in dollars per share) | $ / shares	$ 35.43
Granted (in usd per share) | $ / shares	54.41
Vested (in usd per share) | $ / shares	32.10
Forfeited (in usd per share) | $ / shares	36.63
Total Non-vested Restricted Stock Units and Restricted Stock Awards at end of period (in dollars per share) | $ / shares	$ 44.31

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Net Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019
Basic:
Net income attributable to Malibu Boats, Inc.	$ 21,225	$ 16,722	$ 42,318	$ 32,581
Shares used in computing basic net income per share:
Basic weighted-average shares outstanding (in shares)	20,717,359	20,591,241	20,684,644	20,710,681
Basic net income per share (in dollars per share)	$ 1.03	$ 0.81	$ 2.05	$ 1.57
Diluted:
Net income attributable to Malibu Boats, Inc.	$ 21,225	$ 16,722	$ 42,318	$ 32,581
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding (in shares)	20,717,359	20,591,241	20,684,644	20,710,681
Diluted weighted-average shares outstanding (in shares)	20,972,902	20,701,473	20,946,800	20,816,830
Diluted net income per share (in dollars per share)	$ 1.01	$ 0.81	$ 2.02	$ 1.57
Antidilutive securities excluded from computation of earnings per share, amount (in shares)	745,055	940,875	733,805	1,042,509
Class A Common Stock
Shares used in computing basic net income per share:
Basic weighted-average shares outstanding (in shares)	20,493,938	20,385,815	20,464,902	20,510,896
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding (in shares)	20,493,938	20,385,815	20,464,902	20,510,896
Restricted Stock Units (RSUs)
Shares used in computing diluted net income per share:
Awards granted to employees (in shares)	153,918	81,661	159,058	81,394
Employee Stock Option
Shares used in computing diluted net income per share:
Awards granted to employees (in shares)	42,361	4,404	43,834	588
Performance Awards
Shares used in computing diluted net income per share:
Awards granted to employees (in shares)	59,264	24,167	59,264	24,167
Fully Vested/Participating | Restricted Stock Units (RSUs)
Shares used in computing basic net income per share:
Basic weighted-average shares outstanding (in shares)	223,421	205,426	219,742	199,785
Shares used in computing diluted net income per share:
Basic weighted-average shares outstanding (in shares)	223,421	205,426	219,742	199,785

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Commitment and Contingencies (Details) $ in Thousands	Nov. 27, 2019 action	Aug. 22, 2019 action	Jul. 27, 2019 action	Jan. 12, 2018 patent	Dec. 31, 2020 USD ($)	Jun. 30, 2020 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Repurchase obligations					$ 180,634	$ 161,356
Financing receivables					$ 165	$ 375
Number of patents allegedly infringed upon | patent				3
Number of actions | action	2	2	2

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Segment Information (Details) $ in Thousands		3 Months Ended		6 Months Ended
	Dec. 30, 2020 segment	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2020 USD ($) segment	Dec. 31, 2019 USD ($)	Jun. 30, 2020 USD ($)
Segment Reporting Information [Line Items]
Net sales		$ 195,647	$ 180,112	$ 376,631	$ 352,192
Income before provision for income taxes		28,495	22,639	56,900	44,165
Assets		670,348		$ 670,348		$ 477,346
Number of reportable segments | segment	3			3
Maverick Boat Group, Inc. and Pursuit
Segment Reporting Information [Line Items]
Number of reportable segments after aggregation | segment				1
Malibu
Segment Reporting Information [Line Items]
Net sales		108,617	97,327	$ 208,448	183,207
Cobalt
Segment Reporting Information [Line Items]
Net sales		47,478	48,994	91,960	99,145
Saltwater Fishing
Segment Reporting Information [Line Items]
Net sales		39,552	33,791	76,223	69,840
Operating Segments | Malibu
Segment Reporting Information [Line Items]
Net sales		108,617	97,327	208,448	183,207
Income before provision for income taxes		17,572	15,200	35,127	26,661
Assets		188,798		188,798		194,502
Operating Segments | Cobalt
Segment Reporting Information [Line Items]
Net sales		47,478	48,994	91,960	99,145
Income before provision for income taxes		5,189	4,853	9,965	10,760
Assets		156,082		156,082		153,820
Operating Segments | Saltwater Fishing
Segment Reporting Information [Line Items]
Net sales		39,552	33,791	76,223	69,840
Income before provision for income taxes		5,734	$ 2,586	11,808	$ 6,744
Assets		$ 325,468		$ 325,468		$ 129,024

XML

Label	Element	Value
Accounting Standards Update [Extensible List]	us-gaap_AccountingStandardsUpdateExtensibleList	us-gaap:AccountingStandardsUpdate201602Member