Sunseeker remains bullish despite losses

Sunseeker International has reported revenues of £343.8m for the 17 months to December 31, 2013, with underlying earnings (EBITDA) of £6.3m. The results effectively amount to a £30m loss for the UK builder, which only two weeks ago announced that it would be streamlining its activities by cutting up to 300 jobs.

Talking exclusively to SB’s sister title IBI on the eve of filing its latest financials, group executive director Sunny Thakrar claimed that the results had been heavily impacted by one-off exceptional charges of £15.5m largely relating to accounting adjustments as a result of the boatbuilder’s acquisition by the Dalian Wanda group last year and a move to new international accounting standards.

The figures were also skewed, Thakrar told IBI, by the fact that the accounting period runs from August 2012 up until the end of last year, missing the first half of 2012, traditionally the most lucrative period for Northern Hemisphere builders, whilst including two winter seasons when costs for boatbuilders are at their highest.

Thakrar added that the business had also invested £15.4m in new model development and R&D in the period.

In its last filed accounts for fiscal 2012, prior to its acquisition by the Chinese conglomerate, Sunseeker reported an increase in turnover to £288.8m for the year, with EBITDA growing by 18% to £30.5m. In a like-for-like comparison with those figures – for the period from August 1, 2012 to July 31, 2013 – Thakrar told IBIthat profits would have been somewhere between £17m-£18m.

“The business remains in good shape for the future,” Thakrar said, highlighting the extensive model development programme currently underway including a new Manhattan 65, 75 Yacht, 86 Yacht, Superhawk 38, Superhawk 50 and 131 Yacht. The 115 will be getting a “drastic” overhaul to become the 116, whilst the second of its 155s is also progressing well, having just completed moulding stage.

“We’ve sold our first three 131 Yachts,” sales director Sean Robertson told IBI, adding that progress was also being made on its new flagship 168 Sport Yacht destined for a Middle Eastern owner.

There’s also a new Predator 57 in the pipe, due for launch at London in January. Sunseeker claims to have already sold 28 of the new model, 24 of those to retail clients.

According to Robertson, the goal is to bring to market 2-3 new models and refresh a further two models every year going forward. The Wanda Group has invested £45m over the last 12 months enhancing product development and Sunseeker’s dealer network.

The global market remains a challenge, but patchy recovery is slowly but surely solidifying and gaining in consistency says Robertson. “There are a lot less peaks and troughs now – it’s remaining more constant,” he says, adding that this year’s round of boat shows had been its most successful since 2008. “Over the last three or four years people would come and look, like what they saw, then go away and think about it. Now they are ordering and signing deals at shows again.”

The US market is recovering for the builder, but still needs some “caressing” according to Robertson, and for some years now Sunseeker has found rich pickings in Central and South America, notably in Mexico and Brazil. It recently opened an office in Colombia. Russian buyers are also continuing their love affair with the brand and remain a significant client base, despite tensions in Ukraine and growing sanctions. Sales in Asia and the Middle East remain dependably solid.

“The only places we’ve not seen a recovery,” says Thakrar, “is Italy and Scandinavia.”

As for China, Sunseeker is working closely with its parent company, helping them develop a marina, service and manufacturing facility in Qingdao. It is also helping in the development of a new boat, that both Thakrar and Robertson are keen to stress will not be a Sunseeker, but most likely a small 30-footer, specifically designed for the local market – probably a power catamaran. “There’s no intention to manufacture Sunseekers, old or new, in China. It’s about seeding and creating a market out there. Wanda knows the heritage of Sunseeker is paramount. It’s British and will remain British. Wanda is here for the long term and very much supports that British heritage and production in our current locations.”

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