Press Releases
Winnebago RV announces big drop in profits
June 18, 2009

Winnebago Industries, Inc. today reported its financial results for the company's third quarter and first nine months of fiscal year 2009 ended May 30.

Revenues for the quarter were $50.8 million versus revenues of $139.7 million for the third quarter last fiscal year. The company reported an operating loss of $14.8 million for the quarter versus an operating loss of $6.9 million for the third quarter of fiscal 2008. Net loss for the third quarter was $8.6 million versus net income of $3.0 million for the third quarter of fiscal 2008. On a diluted per share basis, the company had a net loss of 29 cents a share for the third quarter of fiscal 2009 versus net income of 10 cents per share for the third quarter last fiscal year.

The third quarter was negatively impacted by lower motorhome deliveries, low absorption of fixed costs and higher production inefficiencies due to lower production volumes, significant increases of wholesale and retail promotions due to challenging market conditions, and a higher mix of lower priced Class C and B motorhome deliveries. There was a positive benefit to cost of goods sold, however, from the liquidation of last-in, first-out (LIFO) inventory values due to a significant reduction of inventory levels. This has the effect of decreasing the net loss by $2.1 million, or seven cents per diluted share.

Revenues for the first 39 weeks of fiscal 2009 were $152.1 million versus $519.1 million for the first 40 weeks of fiscal 2008. Operating loss was $50.3 million for the first 39 weeks of fiscal 2009 versus an operating income of $9.1 million for the first 40 weeks of fiscal 2008. Net loss for the first 39 weeks of fiscal 2009 was $28.5 million versus net income of $15.5 million for the first 40 weeks of fiscal 2008. On a diluted per share basis, the company had a net loss of 98 cents a share for the first 39 weeks of fiscal 2009 versus net income of 53 cents a share for the first 40 weeks of fiscal 2008.

ACCORDING TO STATISTICAL SURVEYS, the retail reporting service for the RV industry, Winnebago Industries gained market share in the combined Class A and C market with 18.4 percent calendar year to date through April 2009 as compared to 17.3 percent for the same period last year. Industry-wide, combined Class A and C motorhome retail sales have declined approximately 46 percent calendar year to date through April. The Recreation Vehicle Industry Association has reported wholesale motorhome shipments industry-wide to have decreased by approximately 78 percent calendar year to date through April.

"While industry motorhome shipments as reported were down 76.6 percent during the first two months of our third fiscal quarter, we were pleased that our shipments showed a less significant decline, at 61.9 percent for the quarter," said Winnebago Industries' Chairman, CEO and President Bob Olson. "We have seen modest improvement industry-wide during calendar 2009 in both retail sales and wholesale shipments, unfortunately, the improvement has not been of the magnitude that would imply a full recovery within the near term. As a result, we are continuing to reduce our cost structure as reflected by the recent announcement of the upcoming closure of our fiberglass manufacturing facility in Hampton, Iowa."

"Credit remains the biggest hurdle the industry faces," said Olson. "Floor plan lending institutions continue to emphasize reducing inventories and increasing turn rates for dealerships across the country. Dealer inventory of Winnebago Industries' products has been reduced by nearly 50 percent since a year ago and by approximately 20 percent since the end of our last fiscal quarter. While our sales order backlog is over 60 percent less than last year at this time, we are pleased that it has increased 14 percent since the end of our last fiscal quarter. We continue to believe we are in a strong financial position with sufficient cash, no long-term debt and with the benefit of a respected brand name known for its quality products."

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