Redwood RV Acquires Carriage Rights at Auction

On a snowy Indiana morning that was clouded with the past, the future emerged bright as Syracuse, Ind.-based Redwood RV, a division of Thor Industries Inc., purchased the brand names, trademarks and intellectual property of venerable RV manufacturer Carriage Inc. Tuesday (Feb. 21) during a court-ordered liquidation of Carriage assets.

Carriage, a luxury fifth-wheel manufacturer established in 1969, was ordered into liquidation following protracted discussions between company executives and its lenders, primarily PNC Bank out of Indianapolis. Ultimately, PNC filed suit Oct. 18 to take possession of Carriage, which reportedly owed the bank more than $5 million.

More than 700 bidders had reportedly registered with Ross, Ohio-based Myron Bowling Auctioneers Inc. for the one-day event. Bidding for the Carriage intangible assets was the high point of the event, which included everything from lots of axles to finished fifth-wheels.

“It’s a historic brand, it’s been around for more than 40 years, and we think there’s a place for historical brands in this industry,” said Don Emahiser, president of both Redwood RV and Topeka, Ind.-based CrossRoads RV. “And we think we’re a company that’s up to the challenge of continuing its legacy.”

Emahiser told RVBUSINESS.com that the Thor division had its eye on the Carriage brand since the former Millersburg, Ind., company had faltered last fall and it became evident that the intellectual property might become available.

“Once the company shut down, we knew the name would be available and, yes, there was an attraction there,” Emahiser noted. “But up until then, no, because Redwood’s been doing amazingly well.

“It’s (Carriage) a brand name we felt we could do something with — and if it became available, who better than us to carry on the tradition?

“But it wasn’t something we planned until Carriage went out of business.”

Emahiser said his own personal link to Carriage — he was president of the builder prior to moving to Thor two years ago and helping to establish Redwood — was an element in the decision to acquire the Carriage brand.

“Not only that,” he added, “but we have a lot of Carriage DNA throughout Redwood and CrossRoads. Likewise, the changes we have going on here have attracted people with Carriage in their background.

“We have, beyond myself, in other executive positions, group leaders, foremen, all the way down to entry-level spots. So we have a good amount of the carriage DNA here. When the brands became available to us it was almost a natural to try to make a play for them.”

According to Emahiser, there is no timetable or firm plans to announce when the Thor division will bring back the Carriage name, which was reportedly purchased for $100,000.

Major RV Stocks See Surge Despite Soft Market

A weak job market and rebounding gasoline prices make it an unlikely time for a renaissance in the recreational vehicle trade.

But, according to a report by Investors Business Daily, the industry’s top players are on a tear.

Thor Industries Inc. shares climbed in eight of the past nine weeks, posting a gain of about 50% since a Nov. 29 low. Winnebago Industries Inc. gained in nine of the past 11 weeks, and is up more than 65% from a Nov. 25 low.

Manufactured housing and park model builder Cavco Industries Inc.’s stock rose five of the past eight weeks, and has added more than 45% since Dec. 19 and more than 80% since Aug. 10. Drew Industries, an RV amd MH components supplier, spiked 8% Monday after a fat fourth-quarter earnings win.

On Feb. 2, Thor released preliminary results for its fiscal second quarter, pointing to 12% overall sales growth. The company gave no sales forecast, but analysts’ consensus estimate calls for a 140% EPS gain when the company reports March 5.

A statement from Chairman, CEO and President Peter Orthwein cited some positive trends.

“Sales momentum remains strong,” he said, adding that results from January trade shows indicated “rebounding consumer confidence, access to credit and low interest rates.”

Brett Jordan, an analyst with Avon Partners, said a large piece of Thor’s momentum owed to a promotion with GE Capital. Starting in mid-September, around Open House in Elkhart, Ind., GE and Thor combined to cover the interest on loans to dealers restocking their floor inventories.

“You could argue that there was a fair amount of unseasonable demand for their product since the dealers were being subsidized to take it,” Jordan said.

Jordan also sees a cyclical component to the stock’s gains. That would help explain why shares of Winnebago, which did not participate in the promotion, are also going great guns.

Craig Kennison, analyst with R.W. Baird & Co., says recreational vehicle stocks often act as an early economic indicator, and the gains could be tied to a changing stance among larger investors. Kennison said he’d been fielding calls from active investors “doing fresh work on the sector,” possibly linked to rising consumer-confidence data.

“More broadly, we’ve seen investors shift from a defensive profile to a more aggressive stance, which has helped the riskier side of the consumer space,” he wrote in a report.

 

Elkhart Open House Week’s Set for Sept. 18-20

North America’s two largest RV manufacturers, Thor Industries Inc. and Forest River Inc., jointly announced today (Feb. 10) that Elkhart County’s 5th Annual RV Open House Week will be held Sept. 18-20 throughout the northern Indiana RV-building center.

Both companies are planning to locate their product displays in the same locations as last year’s Open House, which drew more than 3,000 U.S. and Canadian dealer personnel to the streets, factories and open roadside lots of area Hoosier communities like Elkhart, Middlebury, Wakarusa and Shipshewana.

Thor’s six RV-building divisions are to be located on the grounds of the RV/MH Hall of Fame, while Forest River’s varied business units will be positioned in and around the grounds of Forest River’s Dynamax facility on C.R. 6 – about a mile apart from each other. Again this year, shuttle buses will ferry dealers back and forth between the two larger displays.

Having said that, the management teams of both companies apparently are looking for another good year of Open House festivities, a rare combination of serious business and social time that tends to cultivate sales as well as build relationships between dealers and manufacturers for the year ahead.

“For this year, we’re looking for more of the same – if not bigger,” says Bob Martin, the former Keystone RV president recently named president of Thor’s RV Group, headquartered in Jackson Center, Ohio. “Based on dealer reaction at Louisville, dealers that weren’t able to make the Open House last year had commented that this year they definitely would make it to the Open House. For us, it’s a great opportunity. We can simply show more product (versus a typical convention) and it’s a little bit more laid back atmosphere.”

Jeff Babcock, general manager for Elkhart-based Forest River, also sees some changes in the works with regard to a “tighter” layout for this year’s exhibitors that should make it easier for some of Forest River’s and Thor’s competitors to “set up camp” in more amenable locations. This would answer one of the chief drawbacks to the Open House for some of the exhibiting companies, who want better and more accessible locations.

“I think that this year is going to be even better than last year,” adds Babcock. “This thing’s taken on a life of its own. I think we’re going to have more participation from other manufacturers outside Indiana and Michigan. They’re going to come in. I know that I’ve talked to a land developer who plans on leasing out over a hundred acres and he thinks he can fill up that acreage.

“I mean, I think this thing’s going to be bigger than it ever has been before, but that just follows suit from the last four years,” he noted. “Every year this goes on, it just gets bigger and bigger, and we’re expecting this year’s Open House to be our best year yet.”

 

 

 

Thor’s Martin Outlines Industry’s Fall, Recovery

Bob Martin is “cautiously optimistic” about the future of the RV industry, according to a report in the Goshen News.

Martin, the recently named RV Group president for Thor Industries Inc., said as much during the monthly “Wake-Up, Goshen” Chamber of Commerce breakfast held Thursday (Feb. 9) morning at the Old Bag Factory. Martin was invited to speak at the event on his predictions for the future of the RV industry.

In beginning his talk, Martin first provided attendees with a quick timeline showing when the RV industry first hit a wall, and when it slowly began to climb upward once again.

“Back in 2003, 2004, 2005, the industry combined was in the mid-300,000 units, and these are retail sales,” Martin said. “So the industry was very high.”

Martin then showed how the industry began to drop precipitously beginning in late 2007 and continued its descent through 2008 and into 2009 before slowly beginning to inch its way back up in 2010.

“My employees at Keystone, they didn’t totally feel it, because our employment numbers went down from 3,000 to 2,000, and now they’re back up to 3,000. So for us, they haven’t been able to see this incredible downturn, because we picked back up within a year,” Martin said. “But it came at the expense of many other manufacturers. There are about 15 other manufacturers that went out of business during that period. People couldn’t get wholesale financing. They couldn’t get retail financing.”

According to the Goshen News, Martin said it is his opinion that the industry has now made it through the worst of the slump, and is slowly making its way back up, though at an admittedly modest pace.

“I feel it will be modest growth,” Martin said. “It won’t be these huge spikes, because in the years of the 300,000 units, it was the years of the housing bubble. And those days are gone. I think the industry will come back slowly and steadily, but it will be a more healthy industry.”

While shipments in the fall looked good due to the uptake in RV open houses throughout the industry, Martin warned that there are some factors that need to be watched that could affect future sales in the coming year.

Included among those factors to look out for is gasoline, he said, noting that current predictions indicate there will be a greater than 50-50 chance that we’ll see gas prices of $4 or more this year. Increased gas prices can increase cost of delivery of RVs to dealers, he said, and can impact the purchase and use of RVs by a public concerned with the cost of fuel.

Martin also noted that 2012 is a presidential election year, which can also have an impact on the industry.

“That can affect the business,” Martin said. “We’ll just have to see how that goes.”

On a brighter note, Martin pointed to increasingly positive signs in the credit, wholesale and retail arenas, as well as growing attendance numbers at recent RV retail shows.

“Overall, my outlook for the year is cautiously optimistic,” Martin said. “I don’t think it will ever boom back to where it was, but it could. But right now I feel great to be in the RV industry.”

 

Thor Reports Increased Sales for 2Q, 6 Months

Thor Industries Inc. reported today (Feb. 2) a 13% increase in sales for the Jackson Center, Ohio-based company’s fiscal second quarter.

Sales during the quarter totaled $596.4 million, including $500.6 million in RV revenue, representing a 15% increase from $437.1 million last year. Bus sales were $95.7 million, a 7% increase from $89.1 million last year.

For the six months, sales rose 12% to $1.27 billion from $1.1 billion the previous year. RV sales gained 13% to just over 1 billion compared with $943.7 million last year. Bus sales in the six months were $207 million, up 9% from $189.2 million the year prior.

Cash, cash equivalents and investments on Jan. 31 were $157 million, lower compared to the prior quarter primarily as a result of the repurchase of two million shares of Thor stock on Jan. 20 for $57 million. Consolidated backlog on Jan. 31 was $647 million compared to $689 million last year. RV backlog was $413 million in comparison with $467 million last year. Bus backlog was $234 million, up 5% from $222 million last year.

“Sales momentum remains strong for Thor, with good results seen in both our RV and bus businesses through the first half of the fiscal year,” said Peter B. Orthwein, Thor chairman, CEO and president. “Results from January retail RV shows have been positive, with good attendance and retail sales activity reported at most shows, reflecting rebounding consumer confidence, access to credit, and low interest rates. Internal tracking of Thor’s recent retail RV sales activity has also been encouraging. Discounting remains a factor in the competitive RV and bus markets, although Thor continues to be well positioned in each of its product categories to take advantage of improving market trends.”

 

Martin’s Mission: Maintain Thor’s Industry Edge

Yesterday’s (Jan. 31) news that Keystone RV Co. President Bob Martin, an 18-year industry veteran born and raised in the RV-building center of Elkhart, Ind., is stepping up Feb. 1 as RV group president of Thor Industries Inc. surely wasn’t a surprise to a lot of rank-and-file employees of Thor, the world’s largest RV manufacturer.

Nor was it probably a revelation to Thor’s competitors that Martin was named to the top job at publicly held Thor – a Jackson Center, Ohio, firm that posted $2.75 billion in fiscal 2011 sales. Those revenues are largely derived from six RV-building divisions, which, along with Keystone, include Airstream Inc., CrossRoads RV, Dutchmen Manufacturing Inc., Heartland Recreational Vehicles LLC and Thor Motor Coach.

As part of the latest transition, Matt Zimmerman, a 13-year Keystone vet now serving as vice president of sales for the Goshen, Ind., unit, succeeds Martin as Keystone’s president. David Chupp, Keystone’s vice president of finance, moves up to COO. Martin will report to Peter Orthwein, Thor’s chairman, president and COO.

Although he hasn’t been all that visible outside Thor’s camp either before or after Ron Fenech vacated the group presidency on Sept. 30, Martin, 42, is a highly regarded individual within the industry who, most will tell you, has made more friends than enemies in his career.

He’s a 1988 Elkhart Central High School grad, a married father of two who played four years of football on scholarship at Purdue University, graduating in 1993. Shortly thereafter, he went to work as a sales trainee at the former Coachmen Industries Inc. in nearby Middlebury, Ind., where his first boss was none other than Fenech.

Martin worked his way up the ranks at Coachmen and went to work in 1998 for Fenech at Keystone, and eventually became national sales manager for Cougar fifth-wheels. “So, that’s how I started,” he added. “I was the original product manager for Keystone. Our model is based on that now. We have product managers for every one of our products who serve as sales managers.”

Then came Keystone jobs as general manager, vice president of sales, COO and president a little over two years ago. “It’s just been an incredible run for me, watching the company grow from about $70 million when I first joined up to where it is today,” said Martin, adding that Keystone’s current financial status — separate from the other divisions — is not public information.

In the big picture, Martin maintains that Keystone and its 900 dealers are in good hands with plenty of youth on the sales management side. And he says he’s going to maintain an office at Thor’s Goshen campus for six months or so to help ease the transition before moving up to Thor’s regional Elkhart office.

“My mission is to continue to grow Thor, not to just maintain the status quo, but to enhance its status as the strongest RV manufacturer in the nation,” Martin told RVBUSINESS.com. “It will be a different role, as I help coordinate things with people. I’ll be a sounding board for the other presidents. I’m not coming in to change peoples’ worlds. I’m coming in to help where I can, realizing the benefit I’ve had in terms of experience at Keystone.”

Bottom line, Martin, like his predecessor, plans to maintain a consistently independent approach with regard to its divisions.

“Yes, that’s what has made Thor what it is,” he explained. “You have these individual companies that, quite frankly, compete. And that’s healthy. That pushes them all to be better and stronger, and I’ll be there just to help with the major items and coordinate things such as the open house. But we have great companies. We have great managers, and I just want to be there to support them and help them grow. And when things in this industry cycle up and down, I want to be there for support.”

 

Thor Names Bob Martin as RV Group President

Thor Industries Inc. announced Tuesday (Jan. 31) that Bob Martin will become RV Group president, effective Feb. 1. Martin replaces Ron Fenech, who retired on Sept. 30.

According to a news release, Thor’s six RV companies – Airstream Inc., CrossRoads RV, Dutchmen Manufacuring Inc., Heartland Recreational Vehicles LLC, Keystone RV Co. and Thor Motor Coach – will report to Martin. Martin will report to Peter Orthwein, Thor’s chairman, president and CEO.

Martin, an 18-year industry veteran and Elkhart, Ind., native, is currently president of Keystone RV, Thor’s largest subsidiary.

In other management moves, Matt Zimmerman, currently vice president of sales for Keystone, succeeds Martin as president. Zimmerman has been with Keystone 13 years in a variety of sales and management positions. In addition, David Chupp, currently vice president of finance for Keystone, has been named COO. Chupp joined Keystone in 2000.

“Bob, Matt, and David assume their new responsibilities with a history of success in their previous positions. These promotions will further strengthen Thor’s leading position in the RV industry,” said Orthwein.

“I am privileged to have this opportunity to be associated with all the great Thor companies,” said Martin. “As the largest RV manufacturer in the world, Thor Industries has much to offer our customers, RV owners and the community. I look forward to working with all of Thor’s RV companies in my new role to leverage the strength and capabilities of Thor Industries.”

Thor Ind. Repurchases 2 Million Shares of Stock

Thor Industries Inc. announced today (Jan. 20) that it has entered into a repurchase agreement, dated as of Jan. 18, to purchase 1 million shares of its common stock at a price of $28.50 per share from the estate of Wade F. B. Thompson in a private transaction.

The estate holds shares of common stock of Thor previously owned by the late Wade F. B. Thompson, Thor’s co-founder and former CEO. The repurchase transaction with the estate was evaluated and approved by members of Thor’s board of directors who are not affiliated with the estate. The transaction was consummated on Jan. 20.

Thor also announced today that it has entered into repurchase agreements with Catterton Partners VI L.P. and certain of its affiliates, each dated as of Jan. 18, to purchase an aggregate of 1 million shares of its common stock at a price of $28.50 per share from Catterton in a private transaction. The transaction with Catterton was also consummated on Jan. 20.

Thor used available cash to purchase the shares from the estate and Catterton. The number of shares repurchased by Thor represented 3.6% of Thor’s issued and outstanding common stock prior to the repurchase transactions. The closing price for Thor common stock on Jan. 18 was $29.34.

 

Thor Industries Board OK’s Quarterly Dividend

Thor Industries Inc. announced that its board approved the payment of a regular quarterly dividend of 15 cents per share at its Dec. 13 meeting.

The regular dividend will be paid on Jan. 13, 2012, to shareholders of record on Dec. 29, 2011.

Thor, based in Jackson Center, Ohio, is the world’s largest manufacturer of recreation vehicles and a major builder of commercial buses and ambulances.

Thor Reports 1Q Sales Bump, Profits Off Slightly

Jackson Center, Ohio-based Thor Industries Inc. reported improved sales and a dip in earnings for the company’s fiscal first quarter, ended Oct. 31.

Sales for the quarter were $673 million, up 11% from $606.7 million last year. Net income for the three-month period was $22.35 million compared with nearly $23.7 million the year prior. Basic earnings per share (E.P.S.) for the quarter were 41 cents versus 44 cents last year.

Total RV segment sales rose 11% to $561.6 million from $506.56 million the previous year.  Towable RV sales for the quarter were $499 million, up 18% from $422.4 million, while motorized sales totaled $62.55 million, down 26% from $84.1 million last year. Towable RV sales for both quarterly periods include Heartland RV LLC since its acquisition on September 16, 2010. Bus segment sales for the quarter, including buses and ambulances were up 11% from the previous year.

Total RV segment income before tax for the quarter was $33.9 million compared with $34 million last year. RV income before tax was down 2% for towables and up 29% for motorhomes.

“We are encouraged by our strong towable RV backlog driven by orders from our fall open house event, coupled with increased RV market retail sales and planned product improvements and introductions at this week’s RVIA Expo in Louisville, Ky. However, the RV market remains very competitive with promotional pricing,” said Peter B. Orthwein, Thor Chairman, CEO and president. “We are also seeing public transit agencies and private operators begin to replace their fleets, which provides opportunities for Thor’s bus segment.”

To view the complete report click here.

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