Topeka, Ind.–based CrossRoads RV announced today (Feb. 22) that Doug Rheinheimer will join the management team as vice president of manufacturing.
According to a press release, Rheinheimer will plan, direct and set strategic direction for engineering, production and manufacturing for CrossRoads and sister company Redwood RV, both subsidiaries of Thor Industries Inc.
Previously, he served as vice president of manufacturing for Keystone RV Co., also a Thor company, helping build the firm from a small start-up to one of the largest RV manufacturer in the industry. Rheinheimer also served as a consultant for CrossRoads when they launched Redwood RV and its product lines in 2010.
“Doug’s leadership experience will be beneficial for CrossRoads employees, products, dealers and ultimately our performance,” said Don Emahiser, president. “He has been a strong contributor, backed by a proven track record of success in managing production operations.”
Editor’s Note: The investment firm of Robert W. Baird & Co. issued a client newsletter following this week’s release of the quarterly financial results for Thor Industries Inc., a leading RV manufacturer. Excerpts from the Baird newsletter follow.
Solid quarter consistent with Baird outlook. Thor reported solid preliminary sales and a healthy order backlog. Big picture, retail demand continues to improve, driving strong orders from confident dealers. Although inventory is expanding, Baird considers it balanced in light of better retail. At the margin, Baird noted relative strength in motorhomes and intense competitive pressure in towables. Baird remains optimistic about the recovery as negative equity evaporates, but would be selective on valuation.
Revenue upside. Preliminary sales for the January quarter improved 24% to $741 million, just shy of the $748 million forecast but above the $716 million consensus forecast. RV sales improved 27% to $636 million, slightly below Baird’s $648 million estimate.
• Towables. Towable revenue improved 18% to $522 million versus our $518 million estimate.
• Motorhomes. Motorhome sales improved 100% to $114 million versus our $130 million estimate.
• Specialty vehicles. Bus sales improved 10% to $105 million versus our $99 million forecast.
Solid backlog. Total backlog improved 27%, to $822 million, slightly above our $793 million forecast. The RV backlog improved 49% to $617 million, significantly exceeding Baird’s $554 million estimate.
• Towables. The towable backlog improved 25% to $375 million versus Baird’s $415 million estimate.
•Motorhomes. The motorhome backlog jumped +114% to $241 million, well above Baird’s $138 million estimate.
• Specialty vehicles. The bus backlog fell 12% to $205 million, well short of Baird’s $240 million estimate.
Strong early retail. Early RV shows have been promising, consistent with Baird’s view that consumers are spending in key discretionary categories as negative equity evaporates. Thor retail demand improved 7% in towables and 19% in motorhomes during the first month of the January quarter, according to industry data that likely will be revised higher.
Inventory remains top investor concern. Thor has been shipping more product to dealers in hopes of better retail results. Meanwhile, confident dealers are more than willing to oblige (the Baird Dealer Sentiment Index is near a record high). After a long destocking cycle that left the cupboards nearly bare, a recent restocking effect has inventory closer to balanced.
Thor Industries Inc. reported a 24.2% increase in sales for the company’s fiscal second quarter, ended Jan. 31.
Preliminary consolidated sales in the second quarter were $741.4 million compared with $597 million in the second quarter last year. RV sales were $636.1 million, up 27% from $501 million the previous year. Towable sales jumped 17.6% to $522.4 million from $444.2 million a year ago while motorized sales more than doubled to $113.7 million from $56.8 million. Bus sales were $105.3 million, up 9.7% from $96 million in the second quarter last year.
For the six months, sales totaled $1.62 billion, a 27.6% increase from $1.27 billion last year. RV sales gained 32.1% to $1.4 billion compared with $1.06 billion the year prior. Towable sales during the period rose 23% to $1.16 billion compared with $943.3 million last year and motorized sales increased to $235.9 million from $119.3 million. Bus sales were $219.5 million, up 5.9% from $207.3 million last year.
Cash, cash equivalents and investments on Jan. 31 were $107.2 million. Thor said the decrease in cash balances was due in large part to the payment of the $1.50 per share special dividend declared by the board and paid in December 2012.
Consolidated backlog on Jan. 31 was $822 million, up 27.1% from $646.9 million last year. RV backlog was $616.6 million, an increase of 49.4% from $412.8 million at the end of the second quarter of fiscal 2012. Towable RV backlog increased 25.2% to $375.4 million and motorized RV backlog more than doubled to $241.2 million Bus backlog was $205.4 million compared to $234.1 million at the end of the second quarter of fiscal 2012.
“Thor achieved solid gains in revenue for the second quarter as the momentum of our RV products introduced in the fall continued at Louisville in late November,” said said Peter B. Orthwein, Thor Chairman and CEO. “Indications from the early RV retail shows have been very positive, with increased traffic and higher sales levels, reflecting continued strength in our industry. Despite the improvements in RV sales, the overall environment in the towables market remains very competitive and elevated levels of incentives associated with orders placed at the fall Open House are reflected in our sales and our second-quarter operating results that we expect to report on March 7. In addition, the bus business continued to be characterized by aggressive competition during the second quarter.”
Topeka, Ind.-based towable builder CrossRoads RV announced the internal promotions of Kurt Alleshouse, Ray Huff and Brian Miller, according to a press release.
In his new position, Huff will oversee manufacturing of the Cruiser, Zinger, Elevation and Sunset production lines as well as CrossRoads’ lamination and complex facilities. “In Ray’s 10 years at CrossRoads, he has proven to be a forward-thinking, dependable individual. His extensive experience will continue to be an asset and contribute to the success of the company,” said Joel Devries, who was recently promoted to COO for the Thor Industries Inc. subsidiary.
As manufacturing manager, Alleshouse will supervise manufacturing of the Rushmore product line at CrossRoads along with the production and lamination facilities for sister company Redwood RV in Syracuse. “Kurt has been instrumental in the success of Redwood RV over the past two and a half years,” said Devries. “Kurt’s enthusiasm, coupled with 12 years experience in RV management, has been a great asset to our company and will be instrumental in the ongoing developments of manufacturing at both locations.”
With the promotion of Alleshouse, Miller will take over the role of plant manager at Redwood RV. Miller has over 19 years of experience in the industry and has been with Redwood since its conception in 2010. “With Brian’s leadership and wealth of experience he was a great fit for the position,” stated Alleshouse.
CrossRoads’ President Don Emahiser noted, “All of our recently promoted employees are very impressive in their own right and a very positive statement to the hiring, and, the mentoring we have been doing at CrossRoads. Whenever we have a supervisor position opening, it brings the talented and the creative employees to the front. I can say all three are exactly that.”
The Florida RV SuperShow drew heavy traffic last week as more than 50,000 consumers gathered at the Florida State Fairgrounds in Tampa to scope out the new 2013 models of recreational vehicles.
Investors Business Daily reported that the show, which ran Jan. 16-20, is a venue for dealers to sell the products on display from the manufacturers they represent.
Thor Industries Inc. had a strong presence in Tampa, where all its subsidiaries and brands were represented.
Thor President and COO Bob Martin gave an upbeat early read on the show, noting, “Attendance at the Tampa show is up from last year, early indications suggest that retail sales are strong, and our dealers remain upbeat,” Martin told Investors Business Daily Jan. 17. “These are all very positive signs for growth for Thor and our industry this year.”
The warm reception at the show is in keeping with the overall climate for the RV industry, which has seen demand heat up after cooling off in a big way during the recession.
The industry started to move on the comeback trail in 2010, and has been gaining speed ever since. RV wholesale shipments are estimated to have grown to 277,000 to 285,000 units in 2012, says Kevin Broom, a spokesman for the Recreation Vehicle Industry Association (RVIA). That would be up from 252,300 units in 2011. Forecasters call for a 4% to 5% rise in RV wholesale unit shipments in 2013, says Broom.
Thor, which makes the whole gamut of RVs, has been cashing in on the rebound. Sales have climbed by double digits in all but one of the past 13 quarters. And profits have risen by double digits for two straight quarters.
First-quarter fiscal 2013 sales popped 30% to $875.6 million, the highest level of sales growth in over two years. Profits climbed 41% to 58 cents a share.
Thor, which also is a major builder of commercial buses and ambulances, saw total RV sales rise 36% to $761.14 million from a year earlier. Its biggest piece of business is in towable RVs, which enjoyed a 28% pop in first-quarter sales to $639.2 million. Motorized RV sales surged 95% to $122.2 million.
First-quarter results were supported by dealer optimism and strong orders at its open house for dealers in Elkhart, Ind., in September, said Thor Chairman and CEO Peter Orthwein in a statement.
Thor Industries Inc. announced that it has named Dominic Romeo as senior vice president and CFO, effective Feb. 4. According to a press release, Romeo has extensive experience in a variety of senior financial functions, having served most recently as vice president and CFO of publicly traded IDEX Corporation, a $2 billion diversified international manufacturer. During his seven-year tenure, IDEX more than doubled both revenues and earnings.
Romeo began his career as an audit manager and CPA with PricewaterhouseCoopers in South Bend, Indiana. He went on to hold key positions with General Electric and AlliedSignal Inc., and later Honeywell where he served in a number of roles over his nine-year tenure, including vice president and CFO of Honeywell Aerospace, a $10 billion business. Romeo’s board affiliations include Federal Signal Corp. and GSI Group.
The company, which is relocating its corporate headquarters to Elkhart, Ind., also announced the promotion of Colleen Zuhl to vice president and corporate controller, effective Feb. 4. Zuhl has served as interim CFO since Oct. 15, having previously served as director of finance. In Zuhl’s new role, all of Thor’s corporate finance and accounting functions will report to her.
“We are excited to welcome Dominic Romeo to the Thor family,” commented Peter B. Orthwein, Thor Chairman and CEO. “Dom has a proven track record of success in several high-profile positions with companies in both the private and public sectors, and he brings the talent, skills and experience that will enable him to assume a leadership role at Thor, both in corporate finance and business strategy. He also has a long history of working effectively with senior operating executives, which will complement the Thor structure very well. I am certain that Dom will be successful in his new role as we welcome him back to northern Indiana.”
Commenting on his new appointment, Romeo noted his excitement to be moving back to the area, given his boyhood roots in northern Indiana where he still maintains a residence. Romeo will report directly to Orthwein.
Thor Industries Inc. today (Jan. 9) announced plans to move its corporate headquarters by spring from its long-time base in Jackson Center, Ohio, to a new location along the St. Joseph River in downtown Elkhart, Ind.
“Given our commitment to the RV industry, we want to be more accessible and active in the community where a large majority of RVs are produced and where more than 70% of our operations are located,” said Thor Chairman and CEO Peter B. Orthwein in a press release. “With so many of Thor’s operations located in Elkhart and neighboring LaGrange counties, it makes sense to have our corporate management and support services as close to as many of our operating subsidiaries as possible.”
As part of the move, Thor’s existing corporate services staff already located in Elkhart will be housed in the new corporate facility on Beardsley Avenue.
“Thor has had a Thor Support Services facility in Elkhart with 30 people for the last three years,” reports Thor President and COO Bob Martin. “We’ve had our human resources, accounting, legal and information technology functions operating out of that office, which is on the north side of Elkhart. We’ve outgrown the offices, so we decided to find a larger office space and have found a building in downtown Elkhart that has been empty for several years and that we’re currently refurbishing.”
Thor’s new headquarters, which will house a staff of 30 to 40, a relatively small number for an 8,800-employee company, was originally the corporate base of Coachmen Industries Inc.
“The building needed a lot of work,” Martin told RVBUSINESS.com. “We’re doing a total renovation. We’ve actually even changed the entrance locations. So, the building looks different. We wanted to put our own image or signature on it so that people don’t see it as the old Coachmen building. And as you go inside, it will be a totally different look and feel. But it’s a great downtown Elkhart location, and it’s great for the community. It draws more people downtown and gets me a lot closer to some of the divisions that are south of Elkhart as well as some of the suppliers, and it keeps us more centrally located.
“We’ll also have enough room to have a board room there so that board members can actually come from New York and elsewhere to board meetings in Elkhart,” said Martin. “It’s a great thing for our company to get our board and entire company more tied to the Elkhart community because 70% of our production is in northern Indiana in Elkhart and LaGrange counties. So it only makes sense for Thor to be here.”
As for the remaining corporate staff in Jackson Center, Martin says there’s really only a couple of employees who haven’t already moved to northern Indiana, and they’ll likely commute.
“The Thor family of companies represent the nation’s largest manufacturer of RVs and a major producer of buses and ambulances, and we’re delighted to have them in Elkhart,” added Elkhart Mayor Dick Moore. “Their presence in the downtown area will bring more investors and corporate activity to our economy, which is great for everyone.”
While it may not be time yet to celebrate the industry’s total resurgence from the Great Recession, this may well be a good moment to pause and appreciate the steady and accelerating (re)growth of the North American recreational vehicle arena after finishing 2012 with a flourish in terms of wholesale and retail sales.
Indeed, we’ve come a long way, baby, since the industry was perched on the leading edge of a global downturn and Elkhart, Indiana’s RV-building zone — with 20-plus-percent unemployment — became America’s recessionary poster child for the national press.
Now the old “first-in, first-out” theory appears to have again come into play with the Recreation Vehicle Industry Association (RVIA) reporting shipments bouncing from a recessionary low point of 165,700 units in 2009 to about 290,000 in 2012.
And while 2012’s output still falls well short of the modern high of 390,500 in 2006, the RV Business staff is recognizing two companies that have played pivotal roles in spearheading the industry’s comeback with stellar performances — Thor Industries Inc. and Forest River Inc., the industry’s unrivaled No. 1 and No. 2 market share leaders, respectively — as RVB’s Newsmakers of the Year for 2012.
Publicly held Thor, an 8,800-employee firm holding 34.8% of U.S. market share in terms of units retailed through October, reported a “blockbuster” first quarter of fiscal 2013 (ending Oct. 31) with sales up 30% to $875.6 million and net income up 38% to $31 million.
In its fiscal year ended July 31, Thor’s sales of RV’s, small and midsize buses and ambulances rose 12% to an all-time high of $3.1 billion on the strength of its varied subsidiaries: Keystone RV Co., Goshen, Ind., Thor Motor Coach Inc., Elkhart, Ind., Dutchmen Mfg. Inc., Goshen, Ind., CrossRoads RV/Redwood RV, Topeka and Syracuse, Ind., Heartland Recreational Vehicles LLC, Elkhart, Airstream Inc., Jackson Center, Ohio, and Thor’s Commercial Vehicle Group in Elkhart.
For Forest River — an 8,500-employee, Elkhart-based division of Berkshire Hathaway Inc. known for its aggressive approach to product development and dealer networking in both towable and motorized RVs as well as cargo trailers, shuttle buses, boats and other categories — the situation right now is similarly upbeat.
Forest River President and CEO Pete Liegl said his company has been running an impressive 27% ahead of 2011 through the first 10 months of 2012 enroute to posting its own all-time record revenues.
“This has been a super good year,” Liegl told RVBUSINESS.COM. “We had good sales. Profits are never as good as they should be, but it’s acceptable. As for the rest of the year, November numbers are good and December’s going to be good, too, in relation to last December. So, when all is said and done, we’ll be bumping 3 billion (dollars in total revenues). We’re probably not going to cross the finish line (exceeding 3 billion dollars in sales for 2012), but we’ll be down there in the red zone.”
At the same time, Forest River, which accounted for 31.8% of all U.S.-retailed RVs through October (according to Statistical Surveys Inc.) and has been growing faster than Thor in certain categories, is dramatically expanding its production capacity for 2013 to the extent that it is currently adding about a million square feet of capacity.
This, said Liegl, should benefit most all of the divisions operated by the company’s senior product-related management team, including Doug Gaeddert, Jeff Babcock, Don Gunden and Mike Terlep in RVs as well as David Wright in buses, Rex McKay in cargo trailers and commercial trucks and Tom McCutty in housing and boats.
Meanwhile, given the general landscape of the industry right now and some of the investor calls he’s been fielding lately, Thor Chairman and CEO Peter Orthwein thinks these kinds of record-breaking numbers are not just a short-term blip on the radar, but part of a more significant industrywide upswing.
“You know, we’re feeling our business is getting much stronger now,” Orthwein told RVB. “In addition to those increased revenues, our backlogs were very strong at the end of the first quarter and certainly in the motorhome segment our revenues nearly doubled. So, we’re feeling good.
“My feeling is that we’re at a turning point in the market right now,” he added, “especially on the motorized side, where the consumer has paid down his loan on his old motorhome and now has equity in that coach and can trade it in and buy a new one. And, by using that equity as a down payment and with today’s low interest rates, he can drive away with a new motorhome without appreciably increasing his monthly payment. So, we’re really at a turning point. Historically, the average consumer traded in his motorhome every four years.”
Thor President and COO Bob Martin said Thor’s fiscal health speaks well for the general well being of the rest of the industry and of the North American consumer’s continued fascination with this kind of camping lifestyle. Even in the global downturn, he pointed out, campgrounds were busy.
“We knew that people, even though they were holding off buying decisions, were going to come back,” said Martin. “As the wholesale and retail credit markets improved, the industry has slowly come back to health. We see a bright future for the industry. Coming out of a strong Open House and a very good Louisville, we see good things to come for next year.”
Other 2012 Newsmaker contenders included Marcus Lemonis, chairman of Camping World Inc. and its sister division, Good Sam Enterprises LLC; former Thor executives Ron Fenech, Bill Fenech and Don Clark and their new enterprise Grand Design RV Co.; Kampgrounds of America Inc. President & CEO Jim Rogers; Darryl Searer, the semi-retired chairman of Ultra-Fab Products Inc., and current president of the RV/MH Heritage Foundation’s Hall of Fame; Elkhart’s Annual Open House Week and Winnebago Industries Inc., Forest City, Iowa. See more details in the January/February issue of RVBusiness.
Bob Martin, president and COO of Thor Industries Inc., recently made a personal contribution of $5,000 toward the RV/MH Heritage Foundation’s “Burn the Bank Note” campaign.
According to a press release, Martin presented his check in December following Indiana Gov. Mitch Daniels’ visit to the RV/MH Hall of Fame and Museum when he presented his 2004 campaign motorhome to the museum which is on loan from the Indiana State Museum.
Thor sponsored the presentation of the event.
“The RV museum is a wonderful testament to the innovators and product innovations that have made the RV industry successful and resilient for over 100 years,” Martin said. “We are proud to support this beautiful display of vintage and historically significant RVs.”
Hall President Darryl Searer noted, “Bob’s personal donation is evidence that his commitment to the Hall’s success goes beyond Thor Industries’ continuing support. In addition to this contribution Bob was a driving force in Thor’s decision earlier this year to contribute $25,000 and another $25,000 from the Thompson Family Foundation Inc., a charitable foundation created by Wade F.B. Thompson, Thor co-founder.”
The “Burn the Bank Note” campaign’s goal is to raise $150,000 in voluntary contributions by April 30. If that goal is reached the Robert “Boots” Ingram family has offered a $50,000 challenge grant, and that would pay off the Hall’s bank note to 1st Source Bank.
Searer said that the bank loan to 1st Source Bank has gone from $840,000 in early 2012 to only about $200,000 now.
The RV/MH Heritage Foundation is a 501-c3 not-for-profit corporation and all donations are tax deductible. Gifts may be made by mail, in person at the Hall, by phone at (800) 378-8694, or through the Hall’s web site at www.rvmhhalloffame.org.”
Thor Industries Inc. announced that its Champion Bus Inc. subsidiary has purchased the bus operation assets of Federal Coach, Goshen, Ind., for $6.8 million in cash from Forest River Inc.
According to a news release, Champion plans to move the assets and begin production of Federal Coach buses at its Imlay City, Mich., production facility in early calendar 2013.
Federal Coach is a premier luxury bus manufacturer, producing a full line of shuttle, executive and limousine buses ranging in capacity from 12 to 44 passengers with annual sales of approximately $25 million. Thor’s Bus Group generated net sales of approximately $444.9 million in the fiscal year ended July 31.
“We are pleased to add the Federal Coach line of luxury buses to our family of brands,” said Andrew Imanse, Thor Bus Group President. “The addition of the Federal Coach line offers Thor’s Bus Group both potential operating synergies and access to important markets within the industry.
“The purchase of the Federal Coach assets, like the purchase of the assets of Krystal Infinity LLC, dba Krystal Enterprises, in September 2012, brings an upscale, high-end retail product that complements our existing product lines, including Champion’s Defender, Crusader and Challenger bus lines.”