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Cavco Sees Earnings More Than Double For 1Q

Cavco Industries Inc. today (Aug. 2) announced financial results for the first quarter ended June 29, 2013, of fiscal year 2014.

Net revenue for the first quarter of fiscal 2014 totaled $134.0 million, up 12.8% from $118.8 million for the first quarter of fiscal year 2013. Net income for the fiscal 2014 first quarter was $3.9 million compared to $1.6 million reported in the same quarter one year ago.

Net income attributable to Cavco stockholders for the fiscal 2014 first quarter was $1.8 million, compared to net income of $0.9 million reported in the same quarter of the prior year. Net income per share based on basic and diluted weighted average shares outstanding for the quarter ended June 29, 2013, was $0.26, versus $0.12 for the quarter ended June 30, 2012.

Subsequent to the end of the first fiscal 2014 quarter and as previously disclosed, Cavco completed the purchase of all noncontrolling interests in Fleetwood Homes Inc., a jointly-owned corporation formed in 2009 by the company and Third Avenue Value Fund. Fleetwood Homes Inc., a Cavco subsidiary, owns Fleetwood Homes, Palm Harbor Homes, CountryPlace Mortgage and Standard Casualty Co. As consideration for the 50% interest that it did not already own, the company agreed to pay $91.4 million in Cavco common stock. The resulting issuance of 1,867,370 shares increased the company’s total number of common shares outstanding to 8,837,324.

Historically, 50% of the financial results of these businesses have been recorded as attributable to Cavco’s common stockholders in the company’s consolidated financial statements. As of July 22, 2013, Cavco owns 100% of these businesses and is therefore entitled to all of the associated earnings from that date forward.

Commenting on the quarter, Joseph Stegmayer, chairman, president and CEO, said, “Positive quarterly sales and earnings growth reported for the first quarter of fiscal year 2014 was reflective of a somewhat healthier business environment and improved production efficiencies. The number of homes sold increased approximately 5% from the same quarter last year.”

Regarding the transaction, Stegmayer added, “This purchase establishes full ownership of all company operations by Cavco’s shareholders. We were gratified to have received supportive shareholder response to the transaction by way of favorable proxy voting turnout and results. We expect that the potential for earnings and equity accretion from the purchase will prove beneficial to our shareholders and the company going forward. Cavco is appreciative of the opportunity to have worked with Third Avenue Management through this transaction and value their continued investment in our company as a holder of Cavco common stock.”

Cavco’s management will hold a conference call to review these results today at noon  EDT. Interested parties can access a live webcast of the conference call on the Internet at www.cavco.com under the Investor Relations link. An archive of the webcast and presentation will be available for 90 days at www.cavco.com under the Investor Relations link.

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