Collingwood, Ontario, October 21, 2021 – The Limestone Boat Company Limited(“Limestone” or the “Company”) (TSXV: BOAT)– owner and builder of Aquasport Boats, Limestone® Boats and Boca Bay Boats – is pleased to provide an update on its recent corporate activities and operational initiatives.
“The marine industry continues to experience unprecedented demand and Limestone is uniquely positioned to become a growing force in the North American market. I am delighted to report that the company has delivered on a number of critical manufacturing, production, distribution and brand milestones, all essential in ensuring a strong corporate, operational, and financial foundation for Limestone and its future. Our team is focused on further establishing a firm supply chain and production cadence through end of this calendar year, and we aim to provide market guidance for the 2022 fiscal year in early January 2022,” stated Scott Hanson, CEO of Limestone.
Manufacturing and Production Output
Limestone’s White Bluff, Tennessee-based boatbuilding headquarters, which produces both the Aquasport Boats and Limestone® Boats product lines for the parent company, is currently producing four and a half boats per week. The company is projecting to complete approximately 100 total units through the end of this 2021 calendar year. As the Company looks towards 2022 and its first full calendar year of production (post May 2021 acquisition), the management team is planning to increase production output by another half boat per week. This would allow unit production output to increase to approximately 450 units for the full 2022 calendar year.
The team is confident in meeting the current production goals, and anticipates continued efforts in achieving the 2022 production milestone. The team’s ability to effectively manage supply chain disruptions has stemmed from its built-in ability to pivot weekly production as needed to align with any potential supply chain adjustments. Management continues to focus on improving plant efficiency with training and equipment, and provide the necessary positive work environment that promotes reduced absenteeism and attrition. To date, the company has overcome many labor disruptions that have been a direct result of ongoing COVID infection rates, and is well poised to further grow its labor force in conjunction with its increasing production efforts.
Order Book Backlog
Limestone’s efforts and commitment to improve its production processes and expand its skilled labor force are critical in meeting the order backlog that it is currently experiencing. Demand continues to outstrip supply in the boating industry, with Limestone brand awareness and popularity continuing to grow at a rapid pace.
Limestone is exceeding its projected capacity for both the 2022 and 2023 Model Year with its current order book backlog. Orders in hand and expressed through the 2022 Model Year exceed projected proforma capacity, standing at 478 units, with a 2022 Model Year Proforma Capacity of approximately 279 units. Expressed Orders for the 2023 Model Year are at 676 units to date, with 2023 Model Year Proforma Capacity of approximately 650 units. The Model Year commences in June of the preceding year and concludes in May of that year.
Distribution and Dealer Development
Beyond the boat order backlog, there is also a dealer development backlog that the company is experiencing. Fourteen new dealers have expressed considerable interest in taking on the Limestone® Boats and/or the Aquasport Boats lines when production becomes readily available in the 2022 and 2023 Model Years. These new dealers will open up additional market representation, further supporting the growth plan for the company. The Company currently distributes product through 50 dealer locations, spanning the Great Lakes, East Coast from Maine to Florida, and the Gulf Region.
The Limestone Boat Company and Vision Marine Electric Vehicle Partnership
Limestone continues to progress with its partner for the future of boating innovation, Vision Marine Technologies. Vision Marine is currently outfitting the Company’s first two Test Boats with Vision’s electric outboard E-motion 180 and anticipates conducting Sea Trials in early January in Tennessee to ensure that Limestone and Aquasport customers seeking big water performance and an environmentally friendly technology get the run times and cruising speeds that they’re seeking and the smooth, deep-V hull design ride they’ve come to expect from the 35-year old heritage boat company.
Limestone’s stated mandate is to establish a disruptive early mover electric footprint in the traditional boating sector. The partnership provides Limestone a technological advantage as the E-motion powertrain offers unprecedented power and torque in an electric outboard and will establish both Limestone and Vision Marine as leaders in the rapidly growing electric segment of the recreational boating industry.
Pending successful results from the Sea Trials, Limestone intends to debut EV outboard power options during the Company’s winter boat show tour.
New Model Development and Launches
The company continues to develop and revamp the entire Limestone® and Aquasport lineup, having introduced and launched two all-new models to the market since July 2021. In September, the company unveiled the all-new dual console L-290DC model under the Limestone® banner. In August, the company debuted its new center console Aquasport 3000CC, the flagship model for Aquasport, with orders and shipments commencing in the fall of 2021. In July, Limestone delivered its first production model, the L-200CC center console, and has been making bi-weekly shipments. Production and shipments of the revitalized L-290CD, L-250R and L-200R have been scheduled to commence in the 4th Quarter, with the L-270CD following in late Q1 2022.
Manufacturing Leadership Team Additions
Improving the production process and unit output to meet the order backlog the Company is experiencing has been critical to Limestone’s success. Equally important has been the Company’s prioritization to further develop and expand its Manufacturing Leadership Team at the company’s White Bluff boatbuilding headquarters. Four new leadership positions were recently filled, including three managerial positions, with the hiring of a controller, procurement manager, human resources (HR) manager, and production manager.
These crucial roles and the talented, field-experienced individuals added to fill them provide Limestone with the necessary skillsets to continue to execute on its strategic growth plan. Prior to the acquisition of the manufacturing facility and associated boat brands produced there, the company recognized that certain investments in new management and leadership positions would be required in order to establish the best working environment for its production team members, and to effectively position the company to meet the highest quality standards for personnel, craftsmanship, materials and throughput. These new leaders and their combined industry experience will help lead Limestone into the future by providing a solid foundation for sustainable and long-lasting growth.
Maximizing Product Cycle Times
The Limestone Boat Company continues to maximize production cycle times and its supply chain, ensuring it will achieve the necessary depth in brand lineup for its network of dealers. The Company continues to streamline its offering in the face of ongoing supply chain challenges to ensure predictability of production, quality throughput, and meeting its target revenue and margin goals.
Corporate Management Team Additions
In addition to the managerial roles established at Limestone’s Tennessee-based manufacturing facility, the company has also bolstered its corporate management team with the hire of new Director of Marketing, Keith McDevitt. McDevitt brings a strong history of managing luxury brands and dealer networks in the consumer durables space, adding yet another layer of expertise for the Limestone team.
“In the competitive boatbuilding environment, it’s important to establish and elevate your brands effectively and consistently – not only for the consumers, but also for those that represent and sell our products on a daily basis, our superior dealer network,” said Hanson. “Keith’s experience and leadership, alongside our marine-savvy brand management team and Agency partners, helps us set a course to attain solidified market share growth with our various model lines.”
Engagement of Market Maker
Limestone announces it has engaged the services of Independent Trading Group (“ITG”) to provide market-making services in accordance with TSX Venture Exchange (“TSXV”) policies. ITG will trade shares of the Company on the TSXV and all other trading venues with the objective of maintaining a reasonable market and improving the liquidity of the Company’s common shares. Under the agreement, ITG will receive compensation of CAD$5,000 per month, payable monthly in advance. The agreement is for an initial term of three months and will renew for additional one month terms unless terminated. The agreement may be terminated by either party with 30 days’ notice. There are no performance factors contained in the agreement and ITG will not receive shares or options as compensation. ITG and the Company are unrelated and unaffiliated entities and at the time of the agreement, neither ITG nor its principals have an interest, directly or indirectly, in the securities of the Company. The engagement is subject to regulatory approval.
ABOUT LIMESTONE BOAT COMPANY LIMITED:
The Limestone Boat Company – owner and builder of Aquasport Boats, Limestone® Boats and Boca Bay Boats – is publicly traded on the Toronto Venture Exchange under the ticker symbol BOAT. They are headquartered in Collingwood, Ontario with a 145,000 sq. ft. manufacturing facility in White Bluff, Tennessee. The company is backed by a large, skilled labor force and dealer partners throughout the United States and the Canadian Great Lakes Region.
Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this news release.
Cautionary Note Regarding Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking information. These statements relate to future events or future performance. The use of any of the words “anticipate”, “believe”, “could” “should”, “would”, “estimate”, “expect”, “forecast”, “indicate”, “intend”, “likely, “may”, “plan”, “potential”, “project”, “outlook”, “seek”, “target”, “trend” or “will” and similar expressions and statements relating to matters that are not historical facts are intended to identify forward-looking information and are based on the parties’ current belief or assumptions as to the outcome and timing of such future events. Actual future results may differ materially. In particular, there are no assurances that the transactions will be completed on the terms or timeframe indicated herein or at all. If these transactions are ultimately completed, the Company will be subject to a number of risks relating to integration and go-forward operations, certain of which are more particularly described in the Company’s public filings available on SEDAR including, without limitation, the filing statement filed by the Company on February 23, 2021, and the MD&A. The forward-looking information contained in this release is made as of the date hereof and the parties are not obligated to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, except as required by applicable securities laws. Because of the risks, uncertainties and assumptions contained herein, investors should not place undue reliance on forward looking information. The foregoing statements expressly qualify any forward-looking information contained herein.
Many factors could cause actual results, level of activity, performance or achievements or future
events or developments to differ materially from those expressed or implied by the forward-looking statements. All the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors in this press release. There can be no assurance that the actual results or developments will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company. Unless required by applicable securities law, the Company does not intend and does not assume any obligation to update these forward-looking statements.