National R.V. Holdings Reports First Quarter 2004 Results Including Record Sales for 'Highline' Products
PERRIS, Calif., April 27 -- For the first quarter ended March 31, 2004, National R.V. Holdings, Inc. today reported net income of $0.7 million, or $0.06 per diluted share, compared with a net loss of $4.7 million, or $0.48 per diluted share, last year. Net sales for the quarter were $110.4 million, up 41% from $78.1 million last year. The Company also reported that sales for the first quarter of its Country Coach "Highline" products reached record levels for any quarter for Country Coach.
"Our focus in the first quarter, as it will be for the rest of 2004, had been to profitably increase production to match our demand. This focus resulted in our Country Coach division achieving record sales during the quarter," said Brad Albrechtsen, National R.V. Holdings' President and CEO. "Strong demand allowed us to ship higher numbers of both gas and diesel units compared to last quarter and the prior year. Our top line growth was consistent with our expectations," continued Albrechtsen.
"Margins continue to be helped by higher production levels and related efficiencies, as well as improvements in our workers compensation reserve," stated Albrechtsen. "However, heavy overtime, discounting on some older high-end units and slowing warranty improvements did not allow us to see the quarter-over-quarter gross profit margin percentage gains that we had expected."
Revenues in the quarter for National RV were $63.3 million, up 19% from $53.4 million for the first quarter last year. Revenues in the quarter for Country Coach were $46.7 million, up 85% from $25.2 million for the first quarter last year.
First quarter wholesale unit shipments of diesel motorhomes were 293, up 24% from 237 units last year. Quarterly shipments of gas motorhomes were 499, up 50% from 332 units last year. Quarterly shipments of towable products were 315, down 19% from 390 units last year.
Quarterly selling, general and administrative (SG&A) expenses were $6.2 million, up 17% from $5.3 million last year. As a percentage of sales, quarterly SG&A expenses were 5.6% versus 6.7% last year.
The Company reported that cash decreased by approximately $1.0 million during the first quarter of 2004, due primarily to an increase of $12.6 million in inventory and a $3.9 million increase in accounts receivable partially offset by a $12.8 million increase in accounts payable, $1.9 million of proceeds from the sale of real property in Florida and $0.7 million of net income.
"Total inventory increased by $12.6 million during the first quarter 2004. This increase resulted mainly from a $2.6 million increase in raw materials, a $1.4 million increase in chassis and an $8.9 million increase in work in process. Generally, inventory levels are reflective of our higher production rates. We expect inventory levels to remain relatively flat in the second quarter," said Chief Financial Officer Mark Andersen. "Annualized inventory turn rates continue to improve as our volumes increase, rising to 6.9 turns in the first quarter of 2004 from 4.5 turns in the first quarter of 2003."
National R.V. Holdings will host a live webcast to review first quarter results today, April 27, 2004, at 2 p.m. Eastern. A link to the conference call can be found on the Company's website at www.nrvh.com and will be archived and available for 90 days.
National R.V. Holdings, Inc. (the Company), through its two wholly-owned subsidiaries, National RV, Inc. (NRV) and Country Coach, Inc. (CCI), is one of the nation's leading producers of motorized and towable recreation vehicles. NRV is located in Perris, California where it produces Class A gas and diesel motorhomes under model names Dolphin, Islander, Sea Breeze, Tradewinds and Tropi-Cal, and travel trailers under model names Blaze'n and Rage'n. CCI is located in Junction City, Oregon where it produces high-end Class A diesel motorhomes under the model names Affinity, Allure, Inspire, Intrigue, Lexa and Magna, and bus conversions under the Country Coach Prevost brand.
This release and other statements by the Company contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements are inherently uncertain. Actual performance and results may differ materially from that projected or suggested herein due to certain risks and uncertainties including, without limitation, the cyclical nature of the recreational vehicle industry; seasonality and potential fluctuations in the Company's operating results; the Company's dependence on chassis suppliers; potential liabilities under dealer/lender repurchase agreements; competition; government regulation; warranty claims; product liability; and dependence on certain dealers and concentration of dealers in certain regions. Certain risks and uncertainties that could cause actual results to differ materially from that projected or suggested are set forth in the Company's filings with the Securities and Exchange Commission (SEC) and the Company's public announcements, copies of which are available from the SEC or from the Company upon request.
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months
Ended March 31,
2004 2003
Net sales $110,438 $78,101
Cost of goods sold 103,151 80,188
Gross profit (loss) 7,287 (2,087)
Selling expenses 3,621 3,130
General and administrative expenses 2,587 2,120
Operating income (loss) 1,079 (7,337)
Interest expense 62 167
Other income (48) (2)
Profit (loss) before income taxes 1,065 (7,502)
Provision (benefit) for income taxes 396 (2,776)
Net profit (loss) $669 $(4,726)
Profit (loss) per common share:
Basic $0.07 $(0.48)
Diluted $0.06 $(0.48)
Weighted average number of shares
Basic 10,190 9,832
Diluted 10,334 9,832
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
March 31, December 31,
2004 2003
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $1,090 $2,059
Restricted cash 250 250
Trade receivables, less allowance
for doubtful accounts ($89 and
$132, respectively) 24,886 20,978
Inventories 64,232 51,659
Deferred income taxes 7,955 7,955
Income taxes receivable -- --
Prepaid expenses 2,005 1,658
Total current assets 100,418 84,559
Property, plant and equipment, net 39,299 40,833
Long-term deferred income taxes 3,805 3,805
Other 1,157 1,252
$144,679 $130,449
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Line of credit $-- $--
Book overdraft -- --
Current portion of long-term debt 13 19
Accounts payable 26,879 14,101
Accrued expenses 21,540 20,770
Total current liabilities 48,432 34,890
Long-term accrued expenses 7,588 7,569
Long-term debt -- --
Total liabilities 56,020 42,459
Commitments and contingencies
Stockholders' equity:
Preferred stock - $.01 par value;
5,000 shares authorized, 4,000
issued and outstanding -- --
Common stock - $.01 par value;
25,000,000 shares authorized,
10,190,230 and 10,190,230 issued
and outstanding, respectively 102 102
Additional paid-in capital 36,463 36,463
Retained earnings 52,094 51,425
Total stockholders' equity 88,659 87,990
$144,679 $130,449
NATIONAL R.V. HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months
Ended March 31,
2004 2003
Cash flows from operating activities:
Net income (loss) $669 $(4,726)
Adjustments to reconcile net income
(loss) to net cash provided by
operating activities:
Depreciation 989 982
Gain on asset disposal (46) --
Changes in assets and
liabilities:
Increase in trade receivables (3,908) (19,432)
(Increase) decrease in
inventories (12,573) 8,264
Decrease in income taxes
receivable -- ( 2,449)
(Increase) decrease in prepaid
expenses (347) 741
Increase in book overdraft -- 2,980
Increase in accounts payable 12,778 10,775
Increase (decrease) in accrued
expenses 789 (204)
Increase in deferred income
taxes -- (370)
Net cash used in operating
activities (1,649) (3,439)
Cash flows from investing
activities:
Decrease in other assets 95 341
Proceeds from sale of assets 1,932 --
Purchases of property, plant and
equipment (1,341) (479)
Net cash provided by (used in)
investing activities 686 (138)
Cash flows from financing
activities:
Net advances under line of credit -- 3,578
Principal payments on long-term
debt (6) (5)
Proceeds from issuance of common
stock -- --
Net cash (used in) provided by
financing activities (6) 3,573
Net decrease in cash (969) (4)
Cash, beginning of period 2,059 14
Cash, end of period $1,090 $10