Company: ONEW
Filing Date: 2025-05-02
Form Type: 10-Q
Source: 0001772921-25-000025
Chunk: 197

Company: OneWater Marine Inc.
Filing Date: 2025-05-02
Form: 10-Q
Item: Part I, Item 2
Chunk 197
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 31, 2025, a change of 100 basis points in the underlying interest rate would cause a change in interest expense of approximately $3.1 million. This hypothetical change does not take into account a corresponding increase to the programs that we may receive from our manufacturers or management’s ability to curtail inventory and related floor plan balances, both of which would reduce the impact of the interest rate increase.

Our A&R Credit Facility exposes us to risks caused by fluctuations in interest rates. The interest rate on our A&R Credit Facility is calculated using Term SOFR (with a 0.00% floor) plus an applicable margin. Based on the $231.4 million outstanding balance that is not covered by interest rate swaps as of March 31, 2025, a change of 100 basis points in the underlying interest rate would cause a change in interest expense of approximately $2.3 million.

As part of our strategy to mitigate the exposure risk to fluctuations in interest rates for our Inventory Financing Facility and A&R Credit Facility, we may enter into various interest rate swap agreements. As of March 31, 2025, we had two interest rate swap agreements with a combined notional amount of $400.0 million. The swaps are designed to provide a hedge against the changes in variable cash flows regarding fluctuations in the SOFR and Term SOFR rates which are used in calculating interest payments. All of our interest rates swaps qualify for cash flow hedge accounting. The following table provides information regarding our interest rate swaps as of March 31, 2025:

Inception DateHedged RateNotional Value at Inception (in thousands)Maturity DateSeptember 2024SOFR$200,000 September 2027September 2024Term SOFR200,000 September 2027

Foreign Currency Risk 

We purchase certain of our new boat and parts inventories from foreign manufacturers and some of these transactions are denominated in a currency other than the U.S. dollar. Our business is subject to foreign exchange rate risk that may influence manufacturers’ ability to provide their products at competitive prices in the United States. From time to time we may enter into foreign currency forward contracts to hedge certain foreign currency exposures to lessen, but not completely eliminate, the effects of foreign currency fluctuations on our financial results. To the extent that we cannot recapture this volatility in prices charged to customers or if this volatility negatively impacts consumer demand for our products, this volatility could adversely affect our future operating results. 

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Item 4.