Winnebago Industries Reports Fiscal Results
FOREST CITY, Iowa--June 16, 2006--Winnebago Industries, Inc. , the nation's leading motor home manufacturer, today reported financial results for the Company's third quarter and first nine months ended May 27, 2006.Net income for the third quarter of fiscal 2006 was $13.2 million, compared to net income of $17.6 million for the same period last year. On a diluted per share basis, the Company earned 40 cents for the third quarter of fiscal 2006, compared to 52 cents for the same period last year. Included as a reduction to net income in the third quarter of fiscal 2006 was $807,000 or 2 cents per diluted share, of stock option expense due to the adoption of Statement of Financial Accounting Standards No. 123R, Share-Based Payment beginning August 28, 2005, which was not effective in the third quarter of last year.
Revenues for the third quarter ended May 27, 2006 were $220.3 million, a decrease of 13.6 percent compared to revenues of $255.0 million for the third quarter of fiscal 2005.
Net income for the first nine months of fiscal 2006 was $35.4 million, compared to $49.7 million for the same period last year. On a diluted per share basis, the Company earned $1.08 for the first nine months of fiscal 2006, compared to $1.46 for the same period last year. Included as a reduction to net income for the first nine months of fiscal 2006, was $3.1 million, or 9 cents per diluted share, of stock option expense.
Revenues for the first nine months of fiscal 2006 were $659.0 million, a decrease of 13.3 percent compared to $760.5 million for the same period last year.
"Results for the third quarter and first nine months of fiscal 2006 were negatively impacted by a continued shift in product mix towards lower priced motor homes as well as by lower motor home deliveries as a result of decreased industry demand," said Winnebago Industries' Chairman and CEO Bruce Hertzke. "We have seen continued weakness in retail demand for Class A products, partially offset by the increased retail demand of Class C products, driven in part by the success of our Winnebago View and Itasca Navion diesel Class C motor homes."
The Company's sales order backlog was 1,642 units at May 27, 2006, up from the backlog of 1,523 units at the end of the third quarter of fiscal 2005.
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 19.1 percent of the combined Class A and C retail market for the first four months of calendar 2006 compared to 17.4 percent for the same period last year.
"The success of our Class C products, particularly the new View and Navion, are helping us increase our market share," said Winnebago Industries' President Ed Barker. "With continued sensitivity to fuel prices nationwide, our View and Navion diesel motor homes, with fuel economy of 17-19 miles per gallon, have been extremely timely. During the third quarter, we also introduced the new 2007 Winnebago Access and Itasca Impulse value-priced, Class C motor homes to our dealers and they have also been well received. I believe we have the best Class C lineup in our Company's 48-year history and look forward to continued market share improvement throughout calendar 2006."
During the Company's third quarter ended May 27, 2006, Winnebago Industries repurchased 1,466,000 shares of common stock for $43.3 million. During the first nine months of fiscal 2006, the Company repurchased 1,758,000 shares of its stock for $51.6 million. On April 12, 2006 Winnebago Industries announced the completion of its $30 million stock repurchase plan and the authorization by the Board of Directors to repurchase additional common stock for an aggregate consideration of up to $50 million. Since April 12, Winnebago Industries has repurchased 751,000 shares of the Company's common stock for $21.6 million. As of May 27, 2006, the Company had $28.4 million remaining on the current share repurchase authorization.
About Winnebago Industries
Winnebago Industries, Inc. is the leading U.S. 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
5/27/2006 5/28/2005 5/27/2006 5/28/2005
---------- ---------- ---------- ----------
Net revenues $220,312 $255,022 $658,992 $760,514
Cost of goods sold 192,236 219,828 579,432 655,995
---------- ---------- ---------- ----------
Gross profit 28,076 35,194 79,560 104,519
---------- ---------- ---------- ----------
Operating expenses
Selling 4,536 4,302 13,714 13,420
General and
administrative 5,160 4,537 15,493 15,892
---------- ---------- ---------- ----------
Total operating
expenses 9,696 8,839 29,207 29,312
---------- ---------- ---------- ----------
Operating income 18,380 26,355 50,353 75,207
Financial income 1,418 761 3,654 1,894
---------- ---------- ---------- ----------
Income before income taxes 19,798 27,116 54,007 77,101
Provision for taxes 6,641 9,536 18,580 27,406
---------- ---------- ---------- ----------
Net income $13,157 $17,580 $35,427 $49,695
========== ========== ========== ==========
Income per share
Basic $0.41 $0.53 $1.09 $1.48
Diluted $0.40 $0.52 $1.08 $1.46
Weighted average common
Shares outstanding:
Basic 32,195 33,289 32,645 33,528
Diluted 32,496 33,747 32,937 34,065
Winnebago Industries, Inc.
Unaudited Consolidated Condensed Balance Sheets
(In thousands)
May 27, 2006 Aug. 27, 2005
------------ -------------
ASSETS
Current assets:
Cash and cash equivalents $15,419 $19,484
Short-term investments 125,000 93,100
Receivables, net 23,681 40,910
Inventories 88,199 120,655
Prepaid and other 15,250 13,943
------------ -------------
Total current assets 267,549 288,092
Property and equipment, net 58,520 63,853
Deferred income taxes 24,146 24,997
Investment in life insurance 20,741 22,066
Other assets 15,377 13,952
------------ -------------
Total assets $386,333 $412,960
============ =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $31,209 $37,229
Income taxes payable 9,256 4,458
Accrued expenses 43,052 48,936
------------ -------------
Total current liabilities 83,517 90,623
Postretirement health care and deferred
compensation benefits, net of current
portion 86,366 86,450
Stockholders' equity 216,450 235,887
------------ -------------
Total liabilities and stockholders'
equity $386,333 $412,960
============ =============
Winnebago Industries, Inc.
Unaudited Condensed Statement of Cash Flows
(Dollars in thousands)
Nine Months Ended
May 27, 2006 May 28, 2005
------------ ------------
Operating activities:
Net income $35,427 $49,695
Adjustments to reconcile net income to net
cash
provided by operating activities:
Depreciation 7,989 7,434
Stock-based compensation 3,964 99
Deferred income taxes 1,002 561
Deferred compensation and postretirement
expense 958 907
Excess tax benefit from stock-based
compensation (280) ---
Other (355) (162)
Change in operating assets and liabilities:
Receivable and other assets 16,030 20,055
Inventories 32,456 415
Accounts payable and accrued expenses (11,696) (4,036)
Income taxes payable 5,113 2,189
Postretirement and deferred compensation
benefits (826) (701)
------------ ------------
Net cash provided by operating activities 89,782 76,456
------------ ------------
Investing activities:
Purchases of short-term investments (150,475) (196,424)
Proceeds from the sale or maturity of
short-term investments 118,575 143,497
Purchases of property and equipment (3,193) (6,666)
Other 168 (300)
------------ ------------
Net cash used in investing activities (34,925) (59,893)
------------ ------------
Financing activities:
Payments for purchase of common stock (51,576) (26,796)
Payment of cash dividends (8,871) (7,054)
Proceeds from issuance of treasury stock 1,245 3,144
Excess tax benefit from stock-based
compensation 280 ---
------------ ------------
Net cash used in financing activities (58,922) (30,706)
------------ ------------
Net decrease in cash and cash equivalents (4,065) (14,143)
Cash and cash equivalents at beginning of
period 19,484 24,445
------------ ------------
Cash and cash equivalents at end of period $15,419 $10,302
============ ============
Certain prior period information has been reclassified to conform to
the current year presentation.
Winnebago Industries, Inc.
Unaudited Motor Home Deliveries
Quarter Ended Nine Months Ended
5/27/2006 5/28/2005 5/27/2006 5/28/2005
---------- ---------- ---------- ----------
Unit deliveries
Class A gas 782 1,058 2,341 3,501
Class A diesel 341 561 1,234 1,707
Class C 1,443 1,088 3,753 2,878
---------- ---------- ---------- ----------
Total deliveries 2,566 2,707 7,328 8,086
Winnebago Industries, Inc.
Unaudited Backlog and Dealer Inventory
(Units)
As of
5/27/2006 5/28/2005
---------- ----------
Sales order backlog
Class A gas 408 566
Class A diesel 148 123
Class C 1,086 834
---------- ----------
Total backlog(a) 1,642 1,523
Total approximate revenue dollars
(in thousands) $120,950 $116,500
Dealer inventory 4,881 5,209
(a) The Company includes in its backlog all accepted orders from
dealers to be shipped 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.