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Lippert Components Debuts Leveling System

May 14, 2010 by · 2 Comments 

Leveling_jacksLippert Components Inc., Goshen, Ind., a leading manufacturer of components for RVs, has introduced Level Up, a revolutionary six-point RV leveling system designed to quickly and safely level a coach with only the touch of a button, according to a news release. ”Campers exhaust a lot of time and energy into getting their coach level,” said Jason Lippert, Lippert and Kinro president and CEO. ”With Level Up, we are giving campers the ability to safely level their coach in less than thirty seconds so they can enjoy their vacation.”

Level Up achieves this feat utilizing the power and speed of Lippert’s jacks, which are on average 10 times faster than their electric counterparts. Level Up utilizes a one touch ”auto level” button that allows the camper to hit a button and let the system do its job in less than 30 seconds.

Level Up’s patented six-point leveling system incorporates a pair of front hydraulic landing gear and pairs of hydraulic leveling jacks before the front axle and behind the rear axle. It is the only leveling system on the market that is sensitive to the integrity of the frame.

The user cannot put the jacks in a lifting sequence that would twist the chassis causing damage to the coach. This is the biggest difference between Level Up and the traditional four-point systems that have been in the field for a while.

Currently, Lippert Components is working with several OEM’s to provide ”Level Up Ready” frames where the customer can add Level Up as an option at the time of purchase, or add it to their coach later.

”We feel there is a large population of campers that will see the upgrade to Level Up as a worthwhile investment,” Lippert said. Lippert Components is currently setting up a dealer network certified to install Level Up in addition to the Trail Airservice center in Goshen, Ind., that has been installing Level Up for the last year and a half.

To learn more, visit www.lippertcomponents.com

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Murray to Head Lippert/Kinro Sales Teams

May 6, 2010 by · Leave a Comment 

Andy Murray

Andy Murray

Lippert Components and Kinro, subsidiaries of Drew Industries Inc., announced today (May 6) that Andy Murray has been promoted to national director of sales.

Murray, a 15-year veteran of the RV industry, has served in various capacities at Lippert Components during the last seven years, steadily expanding his knowledge of the company’s products and becoming acutely aware of customer requirements, according to a news release.

“Andy has been a leader in implementing our unsurpassed culture of customer service,” said Jason D. Lippert, president and CEO of Lippert Components and Kinro. “He has a great understanding of our capabilities, and he knows how to use those capabilities to develop solutions for our customers. Andy’s devotion to serving our customers has greatly contributed to our growth and to the wide variety of new products we have introduced. He will continue to focus on product development and strategic planning for marketing and sale of Lippert and Kinro’s RV products.”

“In his new position, Andy will serve on the executive committees of Lippert Components and Kinro, adding to our management team his vision, energy, and strategic thinking,” added Lippert. “It is people like Andy that separate us from all other vendors, and we will make sure that he has all the resources needed to continue providing the best possible service to our customers.”

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Lippert Completes Acquisition of Schwintek Inc.

March 17, 2010 by · Leave a Comment 

Drew Industries Inc. reported Tuesday (March 16) that its wholly owned subsidiary, Lippert Components Inc., completed the previously announced acquisition of certain intellectual property and other assets from Cassopolis, Mich,-based Schwintek Inc.

The purchase included several products for which patents are pending, including an innovative wall slide-out mechanism, an aluminum cylinder for use in leveling devices for motorhomes and a new tent camper device, according to a news release.

The purchase price consists of $20 million paid at closing from available cash, plus an earn-out which is expected to aggregate $10 million to $15 million over the next three to five years, depending on future unit sales of these products in excess of pre-established hurdles. Mike Schwindaman and Mike Howard, the owners of Schwintek, entered into consulting, product development and non-competition agreements with Lippert Components.

“Our strong balance sheet and cash position enabled us to complete this acquisition without incurring debt,” said Fred Zinn, Drew president and CEO. “We still have adequate cash to continue to pursue expansion opportunities that we believe will yield favorable returns on our investment.”

“Largely through new product introductions and market share growth, we have more than tripled our content in the average travel trailer and fifth-wheel RV, from $670 in 2001 to $2,101 in 2009. These new products fit into our long-term plan to continue to increase our content in all types of RVs,” said Zinn. “Mike Schwindaman has a proven ability to design new products that are both extremely functional and efficient to manufacture.

The product development agreements with Schwindaman and Howard “greatly expand the R&D capabilities of Lippert Components, and provide a framework for our purchase of additional RV products they design over the next five years. They are already working on a ‘new concept’ leveling device for motorhomes that utilizes the aluminum cylinder we just purchased.”

“The new wall slide-out design is expected to gain substantial market share in both the motorhome and towable RV markets, because of its significant advantages over many other slide-out mechanisms,” said Jason Lippert, President and CEO of Drew’s subsidiaries, Lippert Components and Kinro Inc. “This wall slide-out mechanism is considerably lighter and more space efficient. It also minimizes the need for manual adjustments by the RV user, significantly reducing one of the biggest warranty issues for RV dealers. Schwintek and Lippert Components have been selling this wall slide-out for several months, and it has generated a high level of interest throughout the RV industry. Lippert Components will now be the exclusive supplier of this product. We are also exploring alternative applications for this design, for example, in our power TV lifts.”

“We will be manufacturing the products we acquired in our existing factories with very little additional overhead, which should allow us to be highly efficient,” said Lippert. “As a result, we expect this acquisition to be accretive to our earnings in the first year. Further, we expect to leverage our extensive marketing and distribution capabilities to continue to gain market share.”

About Drew

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Drew Industries Inc. Reports Q4 Sales Up 37%

February 16, 2010 by · Leave a Comment 

Drew Industries logoDrew Industries Inc., a leading supplier of components for recreational vehicles and manufactured homes, today (Feb. 16) reported net income for the fourth quarter ended Dec. 31 of $2.9 million.

Net income for the quarter was reduced as a result of charges related to plant closings and start-ups and employee relocation, according to a news release.

In the 2008 fourth quarter, the White Plains, N.Y.-based company reported a net loss of $9.2 million, including charges for goodwill impairment and executive retirement aggregating $4.9 million after taxes and charges for plant closings and severance aggregating $800,000 after taxes.

Net sales in the 2009 fourth quarter were $105 million, up 37% from the $77 million in the fourth quarter of 2008. This sales increase was largely the result of an 88% increase in industrywide wholesale shipments of travel trailers and fifth-wheel RVs, partially offset by a 27% decline in industry-wide production of manufactured homes.

“During 2008 and the first eight months of 2009, RV dealers and their lenders focused on reducing inventories, resulting in a decline of an estimated 70,000 units,” said Fred Zinn, Drew president and CEO. “In 2009 alone, dealer inventories of travel trailers and fifth-wheel RVs declined by an estimated 30,000 units, implying that retail demand significantly exceeded industrywide wholesale shipments. Over the past few months, it appears that dealer inventories have stopped declining, and as a result, production levels have increased. Evidence of improved industry conditions and Drew’s market share growth has certainly been seen in January 2010, as our net sales increased to $44 million, well more than double our January 2009 net sales.”

“We are extremely pleased to end 2009 on such a positive note, particularly after the very bleak landscape we faced in the RV industry just a year ago, when most of our customers were shut down for extensive periods of time, and industrywide production of RVs was running at the lowest level in decades” said Jason Lippert, president and CEO of Drew’s subsidiaries, Lippert Components and Kinro.

“While the RV industry has a long way to go to get back to where it was a few years ago, industry-wide production levels for travel trailers and fifth-wheel RVs have been well above year-earlier levels for five consecutive months,” Lippert said. “Our customers are running their factories five days a week, even in the seasonally slow winter months. Of course, increased retail demand for RVs is the key to a sustained recovery. In this regard, reports from January and February 2010 RV trade shows have been encouraging; however, we are eager to see how the RV consumer responds in the upcoming spring selling season.”

“While industrywide production of RVs has increased, production in the manufactured housing industry has continued to decline. In addition, we are likely to see further year-over-year declines in industrywide production of manufactured housing over the next several months, partially due to the scarcity of retail financing, and continued reductions in inventory on dealer lots,” said Zinn. “While we tend to focus on our accomplishments in the RV industry, we are extremely pleased that, despite the severe conditions in the manufactured housing industry, Drew continued to be profitable in this segment by carefully controlling costs.”

Costs of the company’s primary raw materials increased in the fourth quarter of 2009, which had a modest impact on fourth quarter results. “Steel and aluminum prices increased 10-30% in the second half of 2009, depending on the type,” said Scott Mereness, executive vice president and COO of Lippert Components and Kinro. “Over the past few months, steel and aluminum prices have leveled off, and some analysts are projecting that there will be no significant changes at least in the near term. We anticipate that these increases in the cost of steel and aluminum will have a modest impact on our future profit margins as compared to the 2009 fourth quarter.”

Full-Year Commentary

For the year, Drew reported a net loss of $24.1 million, due to the first quarter goodwill impairment charge of $29.4 million, net of taxes. Excluding the goodwill impairment charge, net income for 2009 was $5.2 million. During the year, the company also incurred expenses totaling $5.5 million, net of taxes, resulting from plant closings and start-ups, staff reductions and relocations, increased bad debts and obsolete inventory and tooling, largely due to the unprecedented conditions in the RV and manufactured housing industries.

For 2008, Drew reported net income of $11.7 million,  including $4.9 million of after-tax charges for impairment of goodwill and executive retirement. Excluding these charges, net income for the year was $16.6 million.

Net sales for the year ended Dec. 31, 2009 were $398 million, a 22% decline from the $511 million in 2008. This compares to a 25% decline in industrywide wholesale shipments of travel trailers and fifth-wheel RVs, and a 39% decline in industry-wide production of manufactured homes.

“Even before the sharp deterioration in the economy, we had made significant strides, including consolidating numerous manufacturing facilities and substantially reducing fixed costs,” said Zinn. “Throughout 2009, we continued to focus on both controlling costs and increasing our content per RV and manufactured home. We reduced fixed costs by $9 million in 2009 compared to 2008, and these cost reduction initiatives will generate further savings of about $3 million in 2010. We are also particularly pleased that our content per travel trailer and fifth-wheel RV increased nearly 9% in 2009.”

“Our efforts to identify and introduce new products were evident at the annual RV show held in Louisville in December, where we displayed numerous new and improved RV products that focused on consumer safety and convenience, including our Quick-Bite™ coupler, an improved suspension system, entry doors with alarm systems and keyless entry, a “new-look” line of windows, and an innovative new wall slide-out mechanism,” said Lippert. “In our manufactured housing segment, we recently introduced a new line of entry doors, and increased our efforts to expand our share of the market for replacement windows, doors and bath products.”

Drew’s RV Segment also manufactures specialty trailers for hauling boats, personal watercraft, snowmobiles and equipment.

In 2009, nearly 93% of the company’s RV segment net sales were components for travel trailer and fifth-wheel RVs, with the balance primarily comprised of components for motorhomes and specialty trailers. The RV segment represented 78% of the company’s consolidated net sales in the fourth quarter of 2009, up from 62% in the 2008 fourth quarter.

Drew’s RV segment reported operating profit of $7.2 million, on net sales of $82 million in the 2009 fourth quarter, compared to an operating loss of $3.1 million on net sales of $47 million in the comparable period in 2008. Segment operating profit in the 2009 fourth quarter was reduced by $1.3 million due to expenses related to facility closings and start-ups, and employee relocations.

“The increase in RV segment operating profit compared to last year was greater than we would typically expect on the $35 million increase in net sales, primarily because of fixed cost reductions and lower warranty costs,” said Joe Giordano, Drew CFO and treasurer. “In addition, operating results for the 2008 fourth quarter were adversely impacted by unusually high raw material costs and the sharp decline in sales, which adversely impacted production efficiencies.”

“RV segment net sales in the fourth quarter of 2009 increased 74% over the depressed levels in the 2008 fourth quarter,” continued Giordano. “This percentage increase was less than the 88% increase in industrywide wholesale shipments, in part because of the greater-than-usual lag between the time we shipped our products to the RV manufacturers in the 2008 fourth quarter and the time they sold the RVs to dealers, and in part because our marine trailer operation on the West Coast continues to be severely impacted by industry declines.”

For the full 2009 year, Drew’s RV segment reported net sales of $308 million, a decrease of 16% from 2008, compared to a 25% decline in industrywide wholesale shipments of travel trailers and fifth-wheel RVs. Excluding the impact of the acquisition in 2008, net sales by Drew’s RV segment declined 20%.

“Acquisitions, new product introductions and market share growth have enabled us to increase our product content for travel trailers and fifth-wheel RVs by 9%, to $2,066 per unit in 2009, compared to $1,902 per unit in 2008,” added Lippert.

RV segment operating profit was $20.0 million for the full year 2009, after giving effect to $5.3 million of expenses related to plant closings and start-ups, staff reductions and relocations, increased bad debts and obsolete inventory and tooling.

“The improvements experienced in the RV industry and our RV business over the past few months were a very welcome relief after the difficult conditions in the first half of 2009 and much of 2008,” noted Zinn. “Given our sales growth in January 2010 and efficient operations, we anticipate solid first quarter results in this segment.”


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Fire Damages Approach $100,000 at Lippert Plant

February 1, 2010 by · Leave a Comment 

Fire caused an estimated $100,000 to $150,000 damage late Friday (Jan. 29) at a Lippert Components plant in Goshen, Ind.

The Elkhart Township Fire Department responded to a blaze at the facility at 65781 Sourwood Drive shortly after 11 p.m., according to The Goshen News.

According to Fire Chief Steven Chupp, the fire started in an oven and spread to the south end of the plant, causing damage to a powdercoat machine as well as to a utility area. The department, with help from the Clinton Township, Benton Township and Goshen departments, took approximately an hour and a half to bring the fire under control.

There were employees working at the time, but all managed to escape.

“No one was injured, but there were a lot of cold feet and fingers,” Chupp said.

Chupp said his damage estimate could be higher depending on the electrical components and other equipment that may have also been damaged.

The fire was ruled an accident.

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Kinro to Begin Manufacturing in Pendleton, Ore.

August 4, 2009 by · Leave a Comment 

kinro2Kinro Manufacturing, a subsidiary of Drew Industries Inc., plans to begin  manufacturing windows and doors for recreational vehicles at a facility in Pendleton, Ore., according to the Mid Columbia Tri City Herald, Kennewick, Wash.

The company would bring up to 80 jobs to the community, said Tracy Bosen, the city’s economic development director.

The plant is expected to start in late September, Bosen said.

The plant previously was used to manufacture RV chassis by another Drew subsidiary, Lippert Components, Bosen said.

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Drew Industries Inc. Reports Second Quarter Profit

July 31, 2009 by · Leave a Comment 

drew-industries-logoDrew Industries Inc., White Plains, N.Y., Thursday (July 30) reported net income of $2.6 million for the second quarter ended June 30, compared to net income for the second quarter of 2008 of $9.2 million.

The net income decline was attributed to a $50 million decrease in net sales to $101 million, 33% below the $151 million reported in the 2008 second quarter. This decline in net sales resulted from a 44% drop in industry-wide wholesale shipments of travel trailers and fifth-wheels and an estimated 43% decrease in industry-wide production of manufactured homes, as compared to the 2008 second quarter.

“We are very pleased with the substantial improvement in our operating results during the second quarter,” said Fred Zinn, Drew president and CEO. “We continued to gain market share in many of our product categories, introduced several new products, and further strengthened our balance sheet. At the same time, our cost control programs have been expanded and are ahead of schedule.”

“Industry-wide shipments of travel trailers and fifth-wheel RVs for the month of June 2009 reached a seasonally adjusted annual rate of about 148,000 units, greater than any other month this year,” said Jason Lippert, president and CEO of Drew’s subsidiaries, Lippert Components and Kinro. “Industry production levels during the last several months have far exceeded our expectations, and we hope this is related to increased retail demand. Although we cannot predict whether this production level will be maintained, the RV industry is currently in a much better position than anyone expected a few months ago.

“Last year at this time many of our customers began to significantly cut back production schedules in response to lower demand from dealers. While there are uncertainties, it appears that many of our customers will continue to produce five days a week for the next couple of months. Beyond that it is difficult to anticipate demand, particularly during the winter months.”

The company also continues to reduce expenses through facility consolidations, staff reductions and synergies between its subsidiaries, Lippert Components and Kinro. Cost reduction measures benefited second quarter 2009 results by over $2 million compared to the same period in 2008, and are expected to benefit full year 2009 results by nearly $10 million.

New Products Introduced

“We continued to gain market share and introduce new products in the second quarter,” said Lippert. “New products included the debut of the Tow-N-Stow convertible storage unit, and the introduction of the innovative QuickBite coupler. We are currently considering several other new products, and we will take every prudent step to ensure that we increase our opportunity for growth, while maintaining outstanding customer service and product quality.”

Net loss for the current six-month period was $34.1 million. Excluding the first quarter 2009 goodwill impairment charge of $29.4 million, net of taxes, and $3 million, net of taxes, of extra expenses in the first quarter of 2009 related to plant consolidations, staff reductions, increased bad debts and obsolete inventory and tooling due to the unprecedented conditions in the RV and manufactured housing industries, the net loss for the current six-month period was $1.7 million.

Due to the seasonality of the RV and manufactured housing industries, the company’s results in the first and fourth quarters are typically the weakest, while second and third quarter results are traditionally stronger.

“The economy, while somewhat better than during the 2008-2009 winter, remains weak,” said Zinn. “In addition, many RV and manufactured housing dealers and consumers continue to have difficulty obtaining credit, which could make it tough for some dealers during the traditional seasonal slowdowns starting later this year. Therefore, our industries are likely to face additional challenges in the latter part of 2009 and the beginning of 2010. Further, our raw material costs continue to be volatile, declining modestly during the 2009 second quarter, but recently rising by 5-15%, depending upon the type of raw material.”

More than 90% of the company’s RV segment net sales are components for travel trailer and fifth-wheel RVs, with the balance comprised of components for motorhomes, and specialty trailers. The RV segment represented 78% of consolidated net sales in the second quarter of 2009.

Drew’s RV segment reported operating profit of $6.3 million, on net sales of $79 million in the 2009 second quarter, compared to operating profit of $13.0 million on net sales of $111 million in the comparable period in 2008. Excluding sales price changes and acquisitions, the “organic” decline in RV Segment net sales was $43 million, or 39%, due to the sharp decline in industry shipments.

For the first six months of 2009, the RV segment reported net sales of $131 million, a decrease of 44% from the same period in 2008. RV Segment operating profit was $1.7 million for the first six months of 2009, including $2.9 million of extra expenses in the first quarter of 2009 related to plant consolidations, staff reductions, increased bad debts and obsolete inventory and tooling. Excluding these extra expenses, the company’s RV segment had an operating profit of $4.6 million in the first six months of 2009.

“Through acquisitions, new product introductions and our position as an increasingly important supplier to leading RV manufacturers, we increased our product content for travel trailers and fifth-wheel RVs to $2,071 per unit for the last 12 months, compared to $1,891 per unit in the prior 12 month period,” said Lippert. “Our success over the years has been a direct result of our ability to gain market share, introduce new products and improve operational efficiency, as well as our financial strength. We are striving for continued success in each of these areas.”

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Lippert Sees Industry Upturn, But Will It Last?

April 24, 2009 by · Leave a Comment 

 

Jason Lippert

Jason Lippert

Jason Lippert, president and CEO of Lippert Components and Kinro, subsidiaries of Drew Industires Inc., sees evidences of an upturn in the RV industry.

“We’re glad to leave behind the very slow winter months, when many of our customers closed for extended periods,” said Lippert, whose observation was contained at the end of  a financial release filed today (April 24) by the parent company. In that quarter, Lippert and Kinro incurred approximately $4 million in extra expenses due to plant consolidations, staff reductions, higher bad debts and obsolete inventory and tooling, he noted.

“In recent weeks we have also experienced an increase in demand for our products, which has helped us improve production efficiencies,” he said. “While it’s too soon to know whether this will continue, it is encouraging to see our facilities producing more and have our employees working more consistent hours.”

He added that Drew is beginning “to realize the benefits of synergies between Lippert Components and Kinro – in terms of increased efficiencies, reduced costs, product development and coordinated sales efforts. We’re extremely proud of the way our management team and all our employees have responded to the very difficult economic conditions, and we are confident in their ability to position Drew to continue to outperform the industries we serve.”

In the release, Drew, based in White Plains, N.Y., stated that it expects operating results for the quarter ended March 31 to reflect a material, non-cash goodwill impairment charge. The company is in the process of finalizing the charge, but it is anticipated to include all or substantially all of the goodwill recorded on the company’s consolidated balance sheet, which totaled $45 million. If, subject to final review, the entire goodwill balance is written-off, the impairment charge would be approximately $29 million, net of taxes, or $1.36 per share.

“The impairment charge is non-cash, and will not affect our operations, liquidity, cash flows, or the company’s borrowing availability under its line of credit and shelf-loan facility,” said Fred Zinn, Drew’s president and CEO. “In the first quarter we generated significant cash flow, increasing our cash balances by $6 million, to more than $14 million at March 31. We also reduced total debt by over $2 million in the first quarter, to less than $7 million. We expect to continue to have strong cash flow over the coming quarters. After giving effect to the impairment charge, our stockholders’ equity will remain well over $200 million, and in this economy, maintaining a strong balance sheet will continue to be a primary focus of our entire management team.”

“The non-cash impairment charge is largely the result of uncertainties in the economy, and in the RV and manufactured housing industries,” said Joe Giordano, Drew CFO and treasurer. “Another key factor in the evaluation of goodwill is the discount rate used to determine the present value of projected cash flows. Since the end of 2008, the discount rate required for this calculation has increased substantially, contributing to the reduction in the fair value of our projected cash flows, which is one basis of our goodwill evaluation.”

Drew will report its full first quarter results on May 4.

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Lippert Components to Unveil Cargo Trailer

April 9, 2009 by · Leave a Comment 

lippert-trailer

 Goshen, Ind.-based Lippert Components Inc. will launch a new  consumer-use cargo trailer, the Tow-N-Stow, that converts and  stores itself as a  storage  unit, at the National Hardware Show  May 5-7 at the Las Vegas  Convention  Center. The unit’s  substructure is made up of steel and  composites that  reinforce  an outer shell consisting of a lightweight, durable  polymer made  from recycled product. The chassis employs a load-dampening torsion axle and steel substructure produced entirely in the U.S. at Lippert’s manufacturing plants. The unit provides nearly 50 cubic feet of lockable, watertight cargo or storage capacity. The Tow-N-Stow’s most innovative feature is its ability to convert from a cargo trailer into an upright, outdoor storage unit in less than one minute. Lippert has domestic and foreign patents pending and is beginning the manufacturing process of the Tow-N-Stow this month. The Tow-N-Stow will be available for retail distribution into home improvement and sporting goods markets. “Fuel costs and a softening economy provide Lippert Components with a  unique opportunity to offer a product that helps consumers maximize fuel  conservation with smaller automobiles,” said Jason Lippert, CEO of Lippert  Components, “which should be very advantageous for our customers. The  Tow-N-Stow lightweight consumer trailer will also utilize our existing  manufacturing capacity, making production very efficient.”

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