Winnebago Industries Inc. continues to ride the recovery of the RV industry in the U.S. and is poised to regain its position as the nation’s leading motorhome manufacturer.
That was one conclusion from a glowing conference call with investors today (Dec. 20) following release earlier in the day of the company’s fiscal 2013 first-quarter results for the period ending Dec. 1.
The Forest City, Iowa-based company reported revenues for the 14-week first quarter were $193.6 million, an increase of 46.8%, versus $131.8 million for the 13-week first quarter of fiscal 2012. Net income for the first quarter was $7.4 million, or 26 cents per share, versus $1.0 million, or 4 cents per share (a 550% increase), for the first quarter of fiscal 2012.
All aspects of the company’s production, save for fifth-wheels, were up from the corresponding quarter a year ago. Winnebago reported these unaudited delivery totals with increases in parentheses:
• Class A gas, 620 units, compared with 381 (62.7%).
• Class A diesel, 345 units, compared with 232 (48.7%).
• Class B, 90 units, compared with 79 (13.9%).
• Class C, 479 units, compared with 348 (37.6%).
• Travel trailers, 408 units, compared with 267 (52.8%).
• Fifth-wheels, 149 units, compared with 168 (down 11.3%).
Wall Street rewarded the upbeat report as company shares were up $1.96 or nearly 14% on trading of 366,000 shares by mid-morning. If investors liked the Q1 results, they could go “ga-ga” over Q2. Winnebago reported a 242.7% year-over-year hike in product backlog for the current quarter, led by the high-margin gas- and diesel-powered Class A motorhomes.
The company lists motorhome backlog valued at $226.5 million compared with $155.9 million a year ago, a 221% increase. Towable backlog totals $14 million, up 35.3% from $10.38 million a year ago.
Randy Potts, Winnebago president, chairman and CEO, reported growing acceptance by both dealers and retail consumers for Winnebago products and a larger market share across-the-board in declaring that Winnebago is “outpacing the industry.”
In particular, Potts reported “tremendous success” in the high-line Class A diesel products, including tag axle floorplans, following the company’s Open House in Elkhart County in September and at the National RV Trade Show in Louisville, Ky., last month. He also cited performance by new entry-level Class C units and the new Minnie Winnie towable which were shown at these events.
The company is still “working through operational issues that have challenged towable production” at the facility in Middlebury, Ind., which remains in the red, he said. However, he added, “We feel it’s on the right path.” The towable operation lost $1.4 million in the first quarter, which was a larger loss than a year ago.
In a far-ranging 45-minute discussion, company officials had these additional observations:
• Sarah Nielsen, vice president and CFO, noted that the company hired 160 additional workers in the quarter and continued to pay workers overtime in many areas of the company. She said the company is utilizing approximately 60% of its capacity in Iowa for motorhome operations and about 30% at its Middlebury facility for towable production. She sees both percentages rising in 2013 as the company ramps up production in both states.
• Winnebago reported its highest growth in profit margin since the first quarter of 2008, a reflection of fixed overhead absorption, Nielsen said. The retail environment is much different now than in the past few years, when the company had to offer discounts and promotional incentives to move product.
• During a discussion of order backlogs and lead times for wholesale deliveries, Potts said chassis availability plays a significant role. Potts said Winnebago is “working those folks very hard” at Ford Motor Co., which supplies the high-demand Class A gas chassis. He said the Ford Econoline or “chopped C’ chassis is readily available, as are chassis from Freightliner, while longer lead times exist for Mercedez-Benz chassis. In general, lead times for wholesale deliveries to dealers are six to eight weeks, “give or take,” he said.