Press Releases
Winnebago reports solid sales, pleases Wall Street
October 15, 2007

RV maker Winnebago Industries, Inc. reported last week that revenues for the fourth quarter and fiscal year ending August 25, 2007 were $237.7 million, an increase of 15.7 percent over the fourth quarter last year.

Net income for the fourth quarter was $14.8 million, compared to net income of $9.3 million for the fourth quarter of fiscal 2006, an increase of 59.3 percent. On a diluted per share basis, the company earned 49 cents a share for the fourth quarter of fiscal 2007, compared to 30 cents per diluted share for the fourth quarter last year.

The revenue increase for the quarter was primarily due to an increase in Class A motorhome unit deliveries, which were nearly 48 percent higher when compared to the same quarter last year. The mix of deliveries in the fourth quarter of 2006 was more heavily weighted to Class C product due to the introduction of the value-priced Winnebago Access and Itasca Impulse. Conversely, the new products introduced during fiscal 2007 have been primarily focused in the Class A product category and generally carry a higher average selling price.

Gross profit margin in the fourth quarter was positively impacted by the stronger mix of Class A motorhomes, and to a lesser extent, an increase in volume. In addition to the positive impact on net income from the increase in gross profit margin, net income also improved in the quarter due to reduced operating expenses. Selling expenses in the fourth quarter decreased over the prior year due to timing of the company's annual dealer event that was held in the third quarter of fiscal 2007 as opposed to being held in the fourth quarter in prior fiscal years.

Revenues for fiscal year 2007 were $870.2 million, an increase of 0.7 percent compared to $864.4 million for the previous year. Net income for fiscal 2007 was $41.6 million, compared to $44.7 million for 2006. On a diluted per share basis, the company earned $1.32 a share, compared to $1.37 a share for 2006.

"We experienced a shift to a higher mix of Class A products sold within the fourth quarter which resulted in both higher revenues and margins," said Winnebago Industries' Chairman and CEO Bruce Hertzke. "As part of our continued long-term strategy of returning profits to our shareholders, we also made significant repurchases of our common stock during the quarter.”

During the company’s fourth quarter ended August 25, 2007, Winnebago Industries repurchased 1,532,000 shares of common stock for an aggregate cost of approximately $44.1 million. In total, 2,160,000 shares, or 6.9 percent of outstanding shares as of August 26, 2006, were repurchased during fiscal 2007 for an aggregate cost of approximately $64.7 million. As of August 25, 2007, the company had $17.5 million remaining on the current share repurchase authorization.

"Retail motorhome sales levels continue to lag behind last year," said Winnebago Industries' President Bob Olson. "According to the most recent report from Statistical Surveys, Inc., a retail reporting service for the RV industry, retail sales of Class A and Class C motor homes combined for the month of August 2007 were down 11 percent and for the calendar year to date through August have declined 4.9 percent compared to the same periods last year. While we believe the Federal Reserve's recent decision to reduce interest rates is a positive step toward improving market conditions for motorhomes, it may take some time for this to translate into sustained growth of the retail motorhome market. In the meantime, we believe dealers will continue to keep their motorhome inventories low or further reduce them as they go into the slower fall and winter seasons."