Fleetwood Reports Fourth Quarter and Fiscal Year Results
27 May 1998
Fleetwood Reports Record Fourth Quarter and Fiscal Year Results
RIVERSIDE, Calif., May 27 -- Fleetwood Enterprises, Inc.
, a leading producer of manufactured housing and the nation's
largest producer of recreational vehicles, today announced record results for
the fourth quarter and fiscal year ended April 26, 1998.
Fourth quarter earnings rose 34 percent to $28.3 million compared to $21.2
million in last year's final quarter. Fourth quarter earnings per share on a
diluted basis, after giving effect to the dilutive impact of convertible
preferred stock issued by the Company in February, increased 40 percent to 81
cents in fiscal 1998 from 58 cents in fiscal 1997.
Earnings from continuing operations reached an all-time high in fiscal
1998, rising 21 percent to $108.5 million compared to $90.1 million last year.
Diluted earnings per share from continuing operations improved an even greater
31 percent to $3.01 compared to $2.30 in the prior year, due to significant
share repurchases over the past two years. The current year per share amount
gives effect to the issuance of convertible preferred stock as mentioned
previously.
Current year earnings include a non-recurring gain of $10.4 million or 28
cents per share on a diluted basis recognized in the first quarter from a
significant reinsurance transaction involving the Company's captive insurance
operation. Earnings in the prior year totaled $124.8 million or $3.19 per
share on a diluted basis, and included a gain of $33.9 million or 87 cents per
share on the sale of the Company's discontinued RV finance operation.
Consolidated sales in the fourth quarter reached an all-time high of
$842.4 million, 13 percent ahead of last year's $746.4 million. The higher
fourth quarter volume reflects improved sales of both manufactured housing and
recreational vehicles. Sales for all of fiscal 1998 totaled $3.05 billion, a
six percent gain over last year's $2.87 billion. With both core businesses
achieving record volume in fiscal 1998, the $3 billion sales barrier was
broken for the first time.
Fleetwood President Nelson W. Potter commented on the favorable results
saying, "It is very gratifying to achieve record earnings and surpass the $3
billion sales mark in the same year. A rebound in manufactured housing
profits, record performances by our travel trailer and folding trailer
divisions and solid results from our supply subsidiaries gave rise to the
favorable earnings comparison. Fiscal 1998 was also an extraordinary year for
the Company in many other respects. We saw a change in leadership at the top,
a substantial share repurchase, a preferred stock offering and our entry into
the manufactured housing retail business.
Potter also said, "The fiscal 1998 financial results could have been even
better were it not for some transitional difficulties encountered with a major
product realignment in the motor home division. This initiative had a
noticeable effect on profitability in fiscal 1998, but we see substantial
benefits from this change going forward.
Manufactured housing revenues reached an all-time high of $375.5 million
in the fourth quarter, 10 percent ahead of the $339.9 million posted in last
year's final quarter. Stronger sales in the central and eastern regions more
than offset a decline in the western region. Housing revenues for the fiscal
year were up four percent to about $1.49 billion, surpassing the previous high
reached in fiscal 1996.
Recreational vehicle sales increased 15 percent in the fourth quarter to a
new high of $455.5 million. This compares with $394.8 million in the final
quarter of fiscal 1997. Motor home sales were up 13 percent to $270.2
million, primarily reflecting stronger sales of upscale Class A products.
Travel trailer revenues rose 19 percent to $154.0 million, and the folding
trailer division produced a 22 percent sales gain to $31.3 million.
Total RV sales for fiscal year 1998 rose nine percent to a new high of
$1.52 billion, up from $1.40 billion in fiscal 1997. The Company's motor home
division generated a six percent sales increase with healthy demand for
Fleetwood's popular Class A products driving sales to a record $904.6 million.
Towable products also fared well in fiscal 1998 as both travel trailer and
folding trailer divisions achieved record sales. Travel trailer revenues
increased 11 percent to $503.8 million and folding trailer sales jumped 27
percent to $109.8 million.
The Company's supply group contributed revenues of $11.4 million for the
fourth quarter and $44.8 million for all of fiscal 1998. This compares with
$11.8 million and $52.3 million, respectively, last year.
FLEETWOOD ENTERPRISES, INC.
Consolidated Summaries of Earnings
(Unaudited)
13 Weeks 13 Weeks 52 Weeks 52 Weeks
Ended Ended Ended Ended
(Amounts in thousands except per share data)
Apr. 26, Apr. 27, Apr. 26, Apr. 27,
1998 1997 1998 1997
Sales $842,404 $746,440 $3,050,567 $2,874,426
Income from continuing operations before
income taxes $44,079 $33,391 $174,949 $147,050
Provision for
income taxes (15,749) (12,222) (66,404) (56,998)
Income from continuing
operations 28,330 21,169 108,545 90,052
Income from discontinued operations:
Income from operations
of finance subsidiary -- -- -- 887
Gain on sale of finance
subsidiary -- -- -- 33,891
-- -- -- 34,778
Net income for basic
earnings per share $28,330 $21,169 $108,545 $124,830
Dividends on convertible preferred stock, net
of income taxes 2,499 -- 2,499 --
Net income for diluted
earnings per share $30,829 $21,169 $111,044 $124,830
Earnings per share:
Basic Diluted Basic Diluted Basic Diluted Basic Diluted
Continuing
operations $.88 $.81 $.59 $.58 $3.09 $3.01 $2.36 $2.30
Discontinued operations:
Income from operations of finance subsidiary
-- -- -- -- -- -- .02 .02
Gain on sale of finance subsidiary
-- -- -- -- -- -- .88 .87
$.88 $.81 $.59 $.58 $3.09 $3.01 $3.26 $3.19
Weighted average Common shares - basic
32,313 35,675 35,090 38,238
Weighted average Common shares - diluted
37,859 36,357 36,933 39,162
Fleetwood Enterprises, Inc.
Business Segment and Unit Shipment Information
(Dollars in thousands)
13 Weeks 13 Weeks 52 Weeks 52 Weeks
Ended Ended Ended Ended
April 26, April 27, April 26, April 27,
1998 1997 1998 1997
OPERATING REVENUES:
Manufactured housing $375,477 $339,850 $1,487,650 $1,426,940
Recreational vehicles 455,523 394,753 1,518,163 1,395,163
Supply operations 11,404 11,837 44,754 52,323
$842,404 $746,440 $3,050,567 $2,874,426
OPERATING INCOME:
Manufactured housing $16,598 $10,617 $75,896 $72,980
Recreational vehicles 29,233 24,686 76,809 77,641
Supply operations 4,148 1,089 15,437 2,170
Corporate and other (5,381) (3,703) (14,127) (13,232)
$44,598 $32,689 $154,015 $139,559
UNITS SHIPPED:
Manufactured housing 16,569 15,585 65,544 65,354
Recreational vehicles
Motor homes 4,009 3,886 13,525 14,345
Travel trailers 10,748 9,171 35,009 32,374
Folding trailers 5,750 5,366 20,960 18,524
20,507 18,423 69,494 65,243