Winnebago Industries Reports Third Quarter and Nine Months Results
FOREST CITY, Iowa--June 16, 2005--Winnebago Industries, Inc. , the nation's leading motor home manufacturer, today reported net income for the third quarter of fiscal 2005 of $17.6 million, compared to net income of $17.7 million for the third quarter of fiscal 2004. On a diluted per share basis, the Company earned 52 cents for the third quarter of fiscal 2005, compared to 51 cents for the third quarter last year. Net income in the third quarter of fiscal 2004 included a charge for a legal settlement, net of income tax effect, of $4.6 million, or 13 cents per diluted share.Revenues for the third quarter ended May 28, 2005 were $255.0 million, a decrease of 17.8 percent compared to revenues of $310.2 million for the third quarter of fiscal 2004.
Net income for the first nine months of fiscal 2005 was $49.7 million, compared to $51.7 million for the first nine months of fiscal 2004. On a diluted per share basis, the Company earned $1.46 for the first nine months of fiscal 2005, compared to $1.48 for the first nine months of fiscal 2004.
Revenues for the first nine months of fiscal 2005 were $760.5 million, a decrease of 8.5 percent compared to $831.2 million for the first nine months of fiscal 2004.
"Third quarter results were negatively impacted by lower motor home deliveries, as well as lower production efficiencies caused by reduced factory production," said Winnebago Industries' Chairman and CEO Bruce Hertzke. "Motor home deliveries for the quarter were lower due to lower retail demand and an industry-wide oversupply of motor homes. As a result, we reduced our production level during the third quarter to better correspond to demand. Additionally, a higher level of discounts was needed to move 2005 motor homes into the distribution channel prior to the new model year."
The Company's sales order backlog was 1,523 units at May 28, 2005 compared to the backlog of 2,444 units at the third quarter of fiscal 2004. "As a result of a weaker backlog and industry-wide softness in the motor home market, we will continue to adjust our factory schedule as necessary to correspond to the demand for our products," said Hertzke.
"Winnebago Industries began production of the unique new Winnebago View and Itasca Navion Class C motor homes in March and began shipping them to dealers during the Company's third quarter," said Winnebago Industries' President and CFO Ed Barker. "The View and Navion are the only motor homes in the industry to be built on the Dodge Sprinter 10,200-pound cutaway chassis with a Mercedes diesel engine. We continue to increase the production rate of these new motor homes and are beginning to fill the dealer channel. Initial response from our dealers on the new View and Navion has been very positive and they have been retailing very quickly after reaching the dealers' lots."
Winnebago Industries is the top-selling motor home manufacturer in the United States. According to Statistical Surveys, Inc., an independent retail reporting service, Winnebago Industries leads the industry with 17.8 percent of the combined Class A and C retail market for the first four months of calendar 2005 compared to 18.4 percent for the same period last year.
During the third quarter ended May 2, 20058, 2005, Winnebago Industries completed the Company's ninth stock repurchase program with the repurchase of 807,721 shares for an aggregate price of approximately $25 million. On a fiscal year to date basis, Winnebago Industries has repurchased 860,321 shares for an aggregate price of approximately $27 million.
At a meeting held yesterday, Winnebago Industries' Board of Directors authorized a tenth stock repurchase program, authorizing the purchase of outstanding shares of Winnebago Industries' common stock for an aggregate price of up to $30 million.
Winnebago Industries today also announced that the Board of Directors increased its quarterly cash dividend by 29 percent. In the meeting held yesterday, the Board declared a quarterly cash dividend of nine cents a share, payable on October 3, 2005 to shareholders of record as of September 2, 2005, an increase of 29 percent from the previous dividend of seven cents a share.
About Winnebago Industries
Winnebago Industries, Inc. is the leading United States manufacturer of motor homes, self-contained recreation vehicles used primarily in leisure travel and outdoor recreation activities. The Company builds quality motor homes under the Winnebago and Itasca brand names with state-of-the-art computer-aided design and manufacturing systems on automotive-styled assembly lines. The Company's common stock is listed on the New York, Chicago and Pacific Stock Exchanges and traded under the symbol WGO. Options for the Company's common stock are traded on the Chicago Board Options Exchange. For access to Winnebago Industries' investor relations material, to add your name to an automatic email list for Company news releases or for information on a dollar-based stock investment service for the Company's stock, visit, http://www.winnebagoind.com/html/company/investorRelations.html.
Winnebago Industries, Inc.
Unaudited Consolidated Statements of Income
(In thousands, except per share amounts)
Quarter Ended Nine Months Ended
5/28/2005 5/29/2004 5/28/2005 5/29/2004
---------- ---------- ---------- ----------
Net revenues $255,022 $310,186 $760,514 $831,152
Cost of goods sold 219,828 264,167 655,995 710,639
---------- ---------- ---------- ----------
Gross profit 35,194 46,019 104,519 120,513
---------- ---------- ---------- ----------
Operating expenses
Selling 4,302 4,756 13,420 13,778
General and
administrative 4,537 13,187 15,892 24,964
---------- ---------- ---------- ----------
Total operating
expenses 8,839 17,943 29,312 38,742
---------- ---------- ---------- ----------
Operating income 26,355 28,076 75,207 81,771
Financial income 761 366 1,894 952
---------- ---------- ---------- ----------
Pre-tax income 27,116 28,442 77,101 82,723
Provision for taxes 9,536 10,738 27,406 31,072
---------- ---------- ---------- ----------
Net income $17,580 $17,704 $49,695 $51,651
========== ========== ========== ==========
Income per share(a)
Basic $0.53 $0.52 $1.48 $1.50
========== ========== ========== ==========
Diluted $0.52 $0.51 $1.46 $1.48
========== ========== ========== ==========
Number of shares used in
per share calculations(a)
Basic 33,289 33,963 35,528 34,396
========== ========== ========== ==========
Diluted 33,747 34,525 34,065 34,972
========== ========== ========== ==========
Certain prior period information has been reclassified to conform to
the current year presentation.
(a)Adjusted for 2-for-1 stock split on March 5, 2004
Winnebago Industries, Inc.
Unaudited Consolidated Condensed Balance Sheets
(In thousands)
May 28, 2005 Aug. 28, 2004
------------- -------------
ASSETS
Current assets
Cash and cash equivalents $10,302 $24,445
Short-term investments 104,027 51,100
Receivables 26,329 46,112
Inventories 130,318 130,733
Other 16,985 17,679
------------- -------------
Total current assets 287,961 270,069
Property and equipment, net 63,066 63,995
Deferred income taxes 25,060 25,166
Investment in life insurance 21,850 22,863
Other assets 13,943 12,463
------------- -------------
Total assets $411,880 $394,556
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $37,287 $46,659
Income taxes payable 5,733 4,334
Accrued expenses 59,621 54,285
------------- -------------
Total current liabilities 102,641 105,278
Post retirement health care and deferred
compensation benefits 87,486 87,403
Stockholders' equity 221,753 201,875
------------- -------------
Total liabilities and stockholders'
equity $411,880 $394,556
============= =============
Certain prior year information has been reclassified to conform to the
current year presentation.
Winnebago Industries, Inc.
Unaudited Condensed Consolidated Statement of Cash Flows
(Dollars in thousands)
Nine Months Ended
5/28/2005 5/29/2004
------------- -------------
Cash flows from operating activities:
Net income $49,695 $51,651
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 7,434 7,173
Tax benefit of stock options 790 2,328
Other 803 617
Change in assets and liabilities:
Decrease in receivables and other
assets 20,055 2,843
Decrease (increase) in inventories 415 (12,991)
Decrease (increase) in deferred income
taxes 561 (5,483)
(Decrease) increase in accounts
payable/accrued expenses (4,036) 14,820
Increase in income taxes payable 1,399 7,714
(Decrease) increase in postretirement
benefits (759) 10,222
------------- -------------
Net cash provided by operating activities 76,357 78,894
------------- -------------
Cash flows (used in) provided by investing
activities:
Purchases of property and equipment (6,666) (7,656)
Purchases of short-term investments (196,424) (123,281)
Proceeds from the sale of short-term
investments 143,497 132,016
Other (300) (137)
------------- -------------
Net cash (used in) provided by investing
activities (59,893) 942
------------- -------------
Cash flows used in financing activities
and capital transactions:
Payments for purchase of common stock (26,796) (74,268)
Payment of cash dividends (7,054) (5,217)
Proceeds from issuance of common and
treasury stock 3,243 4,524
------------- -------------
Net cash used in financing activities and
capital transactions (30,607) (74,961)
------------- -------------
Net (decrease) increase in cash and cash
equivalents (14,143) 4,875
Cash and cash equivalents-beginning of
period 24,445 9,272
------------- -------------
Cash and cash equivalents-end of period $10,302 $14,147
============= =============
Certain prior year information has been reclassified to conform to the
current year presentation.
Winnebago Industries, Inc.
Unaudited Motor Home Deliveries
Quarter Ended Nine Months Ended
5/28/2005 5/29/2004 5/28/2005 5/29/2004
---------- ---------- ---------- ----------
Unit deliveries
Class A gas 1,058 1,378 3,501 3,988
Class A diesel 561 900 1,707 2,145
Class C 1,088 1,166 2,878 3,295
---------- ---------- ---------- ----------
Total deliveries 2,707 3,444 8,086 9,428
Winnebago Industries, Inc.
Unaudited Backlog and Dealer Inventory
(Units)
As of
5/28/2005 5/29/2004
---------- ----------
Sales order backlog
Class A gas 566 1,100
Class A diesel 123 532
Class C 834 812
---------- ----------
Total backlog(a) 1,523 2,444
Total approximate revenue dollars (in thousands) $116,500 $214,400
Dealer inventory 5,209 5,173
(a)The Company includes in its backlog all accepted orders from
dealers shippable within the next six months. Orders in backlog can be
cancelled or postponed at the option of the purchaser at any time
without penalty and, therefore, backlog may not necessarily be an
accurate measure of future sales.
