The major components of the net unfavorable change in working capital were as follows: an unfavorable change of $3.3 million in inventories primarily due to the timing of shipments of finished boats and receipts of raw materials and key components; a $1.8 million unfavorable change in accounts payable due to the timing of payments; an unfavorable change in other accrued expenses; partially offset by a favorable change of $3.5 million in accounts receivable due to the timing of receipts in comparison to the prior year.
Cash used for investing activities for the three months ended March 31, 2020 was approximately $0.7 million compared to $6.6 million provided by investing activities for the same period in 2019. The unfavorable change in cash used for investing activities is primarily due to net sales of marketable securities during the first quarter of 2019 resulting from a change in investment strategy, partially offset by a decrease in capital expenditures during the current quarter in comparison to the same period in the prior year.
Cash used for financing activities for the three months ended March 31, 2020 decreased approximately $3.9 million compared to the three months ended March 31, 2019 primarily due to a decrease in open market share repurchases in 2020 compared to the prior year.
Financial Condition and Liquidity
The Company believes that the liquidity provided by existing cash, cash equivalents and marketable securities, its overall strong capitalization and cash generated by operations will provide sufficient capital to meet the Company’s requirements for at least the next twelve months. The Company’s decisions about the amount of cash to be used for investing and financing purposes are influenced by its capital position and the expected amount of cash to be provided by operations.
Cash Requirements
The Company currently expects that capital expenditures in 2020 will be approximately $3.4 million, of which $0.7 million has been spent through March 31, 2020.
The Company participates in a multiple employer Retirement Income Plan, sponsored by RPC, Inc. (“RPC”). The Company did not make a cash contribution to this plan in the first quarter of 2020 and does not expect to make any additional contributions for the remainder of 2020.
As of March 31, 2020, the Company has repurchased a total of 6,581,632 shares in the open market under the Company stock repurchase program, which began in 2002. There are 1,668,368 shares that remain available for repurchase under the current authorization. There were no shares repurchased under this program during the three months ended March 31, 2020.
On April 28, 2020, the Board of Directors declared a reduction in the quarterly cash dividend from $0.12 per share to $0.08 per share payable June 10, 2020 to common stockholders of record at the close of business May 11, 2020. In light of the uncertainty in the economy and our business by the impact of COVID-19, we believe this reduced dividend is prudent at this time. The Company expects to continue to pay cash dividends to common stockholders, subject to industry conditions and Marine Product’s earnings, financial condition, and other relevant factors.
OFF BALANCE SHEET ARRANGEMENTS
To assist dealers in obtaining financing for the purchase of its boats for inventory, the Company has entered into agreements with various third-party floor plan lenders whereby the Company guarantees varying amounts of debt for qualifying dealers on boats in inventory. The Company’s obligation under these guarantees becomes effective in the case of a default under the financing arrangement between the dealer and the third-party lender. The agreements provide for the return of all repossessed boats to the Company in a new and unused condition as defined, in exchange for the Company’s assumption of specified percentages of the debt obligation on those boats, up to certain contractually determined dollar limits which vary by lender. The Company had no material repurchases of dealer inventory during the three months ended March 31, 2020 and 2019.
Management continues to monitor the risk of defaults and resulting repurchase obligations based in part on information provided by the third-party floor plan lenders and will adjust the guarantee liability at the end of each reporting period based on information reasonably available at that time.