Elkhart, Ind.-based Thor Industries Inc. today (Aug. 5) announced record sales as well as an improved backlog for the fourth quarter and full year ended July 31.
Sales in the fourth quarter were $1.023 billion, up 15.2% from $888.2 million in the fourth quarter last year. RV revenue was $913.2 million, representing an 18.6% rise from $769.9 million a year ago. Towable sales were up 12.6% to $745.3 million while motorhome sales enjoyed a 55.8% jump to $167.9 million.
Bus sales were $110.1 million, down 6.9% compared to $118.3 million in the fourth quarter last year primarily as a result of the sale of SJC Industries on April 30.
For the full year, revenue grew 19.6% to $3.69 billion from just over $3 billion last year. RV sales grew 22.8% to $3.241 billion from $2.640 billion, including a 15.9% increase in towable sales to $2.650 billion and a 67.1% surge in motorized sales to $591.2 million. Bus sales were $448.8 million, up 0.9% from $444.9 million last year, including the results of SJC Industries for the first nine months of fiscal 2013 and 12 months of fiscal 2012.
RV backlog on July 31 was $441.5 million, up 31.7% from last year. Towable RV backlog increased 1.7% to $228.4 million and motorized RV backlog nearly doubled to $213.1 million.
With the decision to sell the bus business, which was announced on July 31, the financial results of the bus segment will be presented as discontinued operations for all periods presented in the upcoming annual report filed with the Securities and Exchange Commission (SEC), which the company expects to file in late September.
“Thor achieved record sales for fiscal 2013 as the continuing growth of the towable RV market was enhanced by the momentum in the motorized market. We are pleased with the strong fundamentals of the entire RV market and we are excited by the growth prospects in both towable and motorized RVs as we enter our new fiscal year,” said Bob Martin, Thor president and CEO. “In September we will be showcasing our newest RV models as we connect with our dealers at our Open House in Elkhart, which we expect will set a positive tone for the upcoming year.”
Thor Industries Inc., Jackson Center, Ohio, announced today (Oct. 15) that it is consolidating production at its General Coach Canada company from two manufacturing locations to one, according to a news release.
In the process, Thor is shuttering its Oliver, British Columbia, production facility and moving all General Coach RV and park model production to its other facility in Hensall, Ontario.
“While we regret the closure of our Oliver, British Columbia plant, our General Coach Canada dealer partners and consumers can be better served through a single point of manufacture in Ontario,” said Thor CEO Dicky Riegel.
Thor expects the wind-down of production in Oliver to be completed by the end of the calendar year. General Coach will work closely with all of its dealers to ensure that delivery of product and parts, service and warranty support are uninterrupted.
“This move will improve product design, quality and pricing for all General Coach dealers,” said Roger Faulkner, pesident of General Coach Canada. “We will be in contact with all of our dealer and campground partners in the coming days to discuss how this change will benefit their locations.”
The latest investment advisory from Robert W. Baird & Co. on the RV industry includes some encouraging information.
Commenting after the release this week of the third quarter financial results from Thor Industries Inc., the Baird advisers said the Thor results provide further evidence that the industry may be near the cyclical “bottom.”
“Thor beat expectations as aggressive cost cuts stemmed the effect of a 41% drop in sales,” Baird stated. “We see more challenges near term, but believe Thor is determined to post a profit this year and is poised to emerge stronger in the next cycle. Improving consumer confidence and easy comps provide potential for Thor and other survivors to post retail growth by the end of 2009.”
In its outlook, Baird added, “While shipments and retail sales remain down year-over-year, the rate of decline has improved. Dealers remain reluctant to accumulate inventory, but consumer confidence edged up – hinting at a retail bottom. While we note that some bankrupt manufacturers may reemerge, Thor has cut costs, accumulated cash and positioned itself as a lean survivor as the market recovers.”
The Baird report had these additional observations:
- Earnings per share ahead of consensus. Thor reported adjusted Q3 (April) earnings per share of $0.15 versus our $0.11 estimate (and $0.10 consensus). Results exclude an $0.11 charge to goodwill. Better RV margins (+$0.06) and lower corporate expenses (+$0.02) were partially offset by lower bus margin (-$0.04) and higher taxes (-$0.01). RV sales fell 48% to $312 million, as expected. Bus sales fell 3% to $103 million.
- Thor Credit. Thor recently announced the launch of Thor Credit, an initiative aimed at making retail credit more readily available. Thor’s balance sheet exposure is limited ($10 million investment) and we are convinced that the program could enhance Thor’s ability to gain market share. The company expects Thor Credit to underwrite roughly $150 million of retail loans in its first year. Thor has $298 million ($5.37/share) in cash & investments and no debt.
- Raising estimates. We are adjusting our Fiscal Year 2009 EPS estimate to $0.31 to primarily incorporate the Q3 upside and a lower tax rate in Q4. We also raised our Fiscal Year 2010 EPS estimate to $0.90 to incorporate a slightly better margin outlook.
Thor Industries Inc., Jackson Center, Ohio, today (May 28) announced a major realignment of management in its Damon Motor Coach and Four Winds International motorhome subsidiaries.
Four Winds President Jeff Kime has resigned to spend more time with his family, according to Thor. “Jeff’s leadership skills, talents and superb 19-year track record at Four Winds have made him the consummate Thor Industries president,” said Dicky Riegel, Thor chief operating officer. “We wish Jeff well.”
Thor also announced that, effective today, both Damon Motor Coach and Four Winds will report to Bill Fenech, who has been promoted to president & CEO of Thor Motorhomes. Fenech previously served as Damon president.
In addition, Dana Simon has been promoted to vice president and general manager of Four Winds, and Matt Thompson has been promoted to vice president and general manager of Damon. Each will report to Fenech.
“Damon and Four Winds remain separate companies producing unique products, even as many support functions have been brought together over the last several months,” said Riegel. “This new structure best serves Damon’s and Four Winds’ dealers and consumers with leading-edge products and services.”
Thor is the world’s largest manufacturer of recreation vehicles and a major builder of commercial buses.
Dutchmen Manufacturing Inc. has introduced the Denali SuperLite travel trailer and mid-profile fifth-wheel series, a lightweight version of its popular Denali towable line designed for towing behind mid-sized pickup trucks. Six of eight Denali SuperLite floorplans feature dry weights of 7,500 pounds or less, according to the company. The Goshen, Ind., Thor subsidiary was able to shave 800 pounds off of comparable units by employing a six-way welded aluminum cage superstructure with lightweight laminated floors and walls. An aerodynamic front profile also is intended to promote enhanced fuel economy. “The weight saving makes Denali SuperLite towable by most half-ton and one-ton trucks,” said Brent Stevens, vice president of marketing and sales. Four 26- to 31-foot travel trailer floorplans are equipped with up to two slideouts, while 26- and 27-foot fifth-wheels feature single living room slides. Solid wood cabinets, enclosed and heated underbellies and flat screen HD TVs are standard. MSRPs start at $21,500.
Richard Klein, a mechanical and aerospace engineer with more than 30 years of experience in vehicle dynamics, was among those addressing 82 representatives of 38 RV manufacturers and suppliers on the stability of trailer design during a March 5 seminar hosted by the Recreation Vehicle Industry Association (RVIA) at the RV/MH Hall of Fame in Elkhart, Ind. Klein reviewed decades-old, safety-related engineering data, according to Bruce Hopkins, RVIA vice president of standards and education. “It appears from listening to Dick Klein that there was engineering information out there for 30 years that is valid today that only a few people knew about,” said David Mihalick, Thor Industries Inc. corporate standards compliance manager. “The seminar got us back to hard engineering data.” In addition to Klein, seminar speakers included consultant Harley Holt, president of Harley Holt and Associates Inc., and David Kinder, a partner with the Texas-based Cox Smith, a law firm that has represented RV manufacturers in cases involving claims related to travel trailer stability and rollovers. “The seminar provided a number of recommendations for the manufacturers to look at,” Hopkins said. The event was sponsored by AL-KO Kober, Corp., Dexter Axle Co. and Norco Industries.
Fleetwood Enterprises Inc., the iconic Riverside, Calif.-based maker of recreational vehicles and manufactured housing that has ferried road-trippers and housed owners for 59 years, is continuing day-to-day operations after filing for Chapter 11 bankruptcy Tuesday (March 10).
As reported by the Press Enterprise, Riverside, part of its business will be shuttering its travel trailer division, affecting 667 employees nationwide including 12 at the company’s Rialto, Calif., service center. Other closures include plants in Pendleton and La Grande, Ore., impacting 415 workers, along with a facility in Edgerton, Ohio, that employed 175 employees people.
Fleetwood said that all current orders would be complete at the plants before they were closed down.
In addition, the company laid off another 65 Inland workers in corporate positions Monday. More than 600 workers remain in Riverside.
The company, which will now be concentrating on its motorhome and manufactured housing markets, still has 15 factories and 3,000 employees nationwide. That’s a far cry from its heyday in 1998 when 21,000 people in 62 factories built RVs, trailers and homes.
A Fortune 500 company for 28 years, the company boosted Riverside’s business image and made the Inland region a destination for other RV makers.
Now, bruised and battered by failed attempts to expand, ballooning debt and an economy in tatters, Fleetwood’s stock traded for a penny per share on Tuesday. The company hasn’t made an annual profit since April 2000.
Since then there has been a flurry of management changes, while the company winnowed its losses from $284 million to $1 million by 2008 after shuttering factories and cutting costs. By then, though, Fleetwood was faced with the country’s deep financial slump.
Buyers couldn’t get bank loans to purchase an RV and dealers couldn’t get financing to order new models from manufacturers.
Plus declining property values meant many buyers could no longer draw on their home’s value and use the cash to buy an RV.
“What we are seeing in the RV industry at this time I don’t believe any dealer or manufacturer anticipated,” said Mellanie Ingle, spokeswoman for Giant RV – one of the largest RV dealerships in California with locations in Colton, Corona, Montclair, Murrieta, Westminster and Indio. “Giant RV is confident Fleetwood will emerge from the Chapter 11 filing. Fleetwood is the foundation of the RV industry.”
The Press Enterprise reported that the company was delisted from the New York Stock Exchange in January. It dropped from 7 cents per share to a penny per share in over-the-counter trading on Tuesday.
There will be 609 employees in Riverside – 200 in corporate headquarters, 93 in its manufactured housing operation and 316 building motor homes – down from a peak of a few thousand in the late 1990s.
In 1998, the company was one of the largest makers of motorhomes and travel trailers, with about a 26.1% market share in RVs and 21.6% share of the travel trailer market.
In 2007, it accounted for just 7.6% of the RV market and 5.9% of all travel trailers sold, according to the company’s most recent annual report.
Joe Hixson, a spokesman for Fleetwood, said there are no immediate plans for more layoffs.
The company is seeking bank funding to keep operating, but “we have what we believe to be sufficient cash for the immediate term,” Hixson said.
Monaco Coach Corp. filed for bankruptcy this month. Perris-based National RV sought chapter 11 protection in late 2007. Weekend Warrior Trailers of Perris closed in September last year.
Christian Eddleman, an analyst with Argus Research, said that Fleetwood’s move was just one more in an industry in serious contraction. “It’s just a nightmare scenario for the RV industry that’s not getting better,” he said.
Eddleman has advised stockholders to sell since the last quarter of 2007. “It’s likely that the shareholders are wiped out,” he said.
As for buyers for Fleetwood’s RV and manufactured housing divisions, the marketplace for struggling RV-related companies doesn’t include a lot of suitors.
“It would have to be someone with deep pockets,” Eddleman said.
Thor Industries Inc., Fleetwood’s competitor with more cash on hand and less debt, could be a possible candidate, he said. He also pointed to Warren Buffett’s Berkshire Hathaway Inc., which bought Indiana-based RV company Forest River Inc. in July 2005. Forest River bought Coachmen Industries Inc. in January.
According to the Press Enterprise, Hixson would only say Fleetwood is “moving with a sense of urgency with discussions with our buyers,” without naming those interested.
Several employees at Fleetwood’s Riverside factory where motorhomes are painted say they’re not discouraged by Tuesday’s news.
“You’re never prepared for this kind of stuff, but you see it happening on the street all the time,” said Ralph Montes, a 63-year-old maintenance supervisor who has been with Fleetwood for 21 years. “We might have some bumps and bruises, but we’ll come out of this OK.”
Montes and Andy Villegas, who works with him, said as of noon Tuesday that no employees have been told their jobs are in jeopardy, and they praised Fleetwood’s past employment practices.
“It’s a great company. We’re going to come out of this whole,” said Villegas, 49, who has been with Fleetwood since 1980. “It has good people and good managers. That’s why I’ve been here so long.”
Villegas said he accepts that the company is struggling because people are less likely to buy luxury items during a recession.
But there were weak sales due to the early 1990s recession, and the company survived that, he said.
“The airline companies had their problems, and they came out of it,” he said. “They’re still flying.”