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Sales of Spartan Chassis take huge drop in RV market
July 24, 2009

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Sales at Spartan Chassis, the largest subsidiary and operating unit of Spartan, Motors, Inc., decreased 42.3 percent year-over year to $104.4 million for the current quarter. Spartan Chassis represented 84.0 percent of Spartan Motors' total consolidated sales in the 2009 second quarter. Spartan Chassis' net quarterly earnings declined 45.7 percent year-over-year, in line with the decline in sales.

Spartan Chassis' sales to the Class A diesel motorhome market declined 92.3 percent year-over-year in the quarter, while backlog for RV chassis decreased 46.2 percent year-over-year to $6.7 million as of June 30, 2009.

"The current outlook for motorhomes remains tough, though we have seen a slight increase in demand for motorhome chassis in recent months and have increased our production accordingly," said John Sztykiel, president and CEO of Spartan Motors. "Spartan continues to position itself for the eventual recovery in the RV industry through product development and innovations to gain market share. More than a half million people continue to enjoy their RVs each day, an indication of how ingrained the RV lifestyle has become in our culture."

Sales of fire truck chassis in the current quarter increased 50.7 percent compared to the same period in 2008, and backlog for fire truck chassis as of the close of the quarter was $84.8 million, a 11.7 percent year-over-year increase. Driving the growth were customer purchase decisions ahead of the 2010 engine emission standards change to engines, municipal spending budget cycles and continued brand preferences for Spartan Chassis by customers and fire departments.

"For fire truck chassis, as well as for all of emergency-rescue products, we continue to hold a positive outlook and expect consistent results through the second half of 2009 and into 2010," said Sztykiel.

Other product sales, which includes specialty chassis for mine-resistant defense vehicles, and SPA business, decreased 49.2 percent year-over-year in the second quarter of 2009, reflecting the completion of several large orders for defense customers in the second half of 2008. Other products backlog was $23.0 million as of June 30, 2009, compared to $188.7 million at the end of the 2008 second quarter.

Spartan Chassis parent company Spartan Motors reported second quarter net earnings of $5.4 million, or $0.16 per diluted share, on net sales of $124.3 million, compared with net earnings of $10.4 million, or $0.32 per diluted share, on net sales of $196.5 million in the same quarter of 2008. The reduction in revenue was due to lower sales to the defense and RV industries, partially offset by increased sales of emergency-rescue products and service, parts and assemblies.

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