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The Recreation Vehicle Industry Association commissioned an Economic Impact Study on the RV industry, released on June 7, 2016. The study found that the RV industry contributes about $49.7 billion in economic output or 0.28 percent of the Gross Domestic Product. Through its production and distribution linkages, the industry impacts firms in 426 of the 440 sectors of the United States economy.

Nationwide, the industry is responsible for 216,170 jobs, both directly and inderectly, creating an economic impact of $37.5 billion. The full study results, along with each individual state and congressional district's economic impact is available on the website by clicking here .

Allison Transmission Reports 8 Percent Increase in First Quarter

Thu Apr 27, 2017

146669996060929.jpgINDIANAPOLIS - Allison Transmission Holdings Inc. has reported net sales for the first quarter of $499 million, an 8 percent increase from the same period in 2016. The increase in net sales was principally driven by higher demand in the Service Parts, Support Equipment and Other end market.

Net Income for the quarter was $83 million compared to $48 million for the same period in 2016. Adjusted EBITDA, a non-GAAP financial measure, for the quarter was $192 million, or 38.5 percent of net sales, compared to $162 million, or 35.1 percent of net sales, for the same period in 2016. Net Cash Provided by Operating Activities for the quarter was $111 million compared to $118 million for the same period in 2016. Adjusted Free Cash Flow, a non-GAAP financial measure, for the quarter was $103 million compared to $113 million for the same period in 2016.

"Allison's first quarter 2017 results exceeded the full year guidance ranges we provided to the market on Feb. 6 principally driven by stronger than anticipated demand for North America service parts," Allison Transmission Chairman and CEO Lawrence Dewey says. "Allison demonstrated solid operating margins and free cash flow while executing its well-defined approach to capital structure and allocation. During the first quarter, we settled $415 million of share repurchases and paid a dividend of $0.15 per share. Given first quarter 2017 results and current end market conditions we are updating our full year net sales guidance to an increase in the range of 7.5 to 10.5 percent."

North America On-Highway end market net sales were down 1 percent from the same period in 2016 principally driven by lower demand for Highway Series and Rugged Duty Series models partially offset by higher demand in Pupil Transport/Shuttle and Transit/Other Bus models and up 18 percent on a sequential basis principally driven by higher demand for Rugged Duty Series, Pupil Transport/Shuttle Series and Transit/Other Bus models.

North America Hybrid-Propulsion Systems for Transit Bus end market net sales were up 18 percent from the same period in 2016 principally driven by the timing of certain transit property orders and flat on a sequential basis.

North America Off-Highway end market net sales were down $4 million from the same period in 2016 and up $1 million on a sequential basis principally driven by the previously contemplated trailing impact of low energy prices.

Defense end market net sales were up 8 percent from the same period in 2016 and down 27 percent sequentially, in both cases principally driven by the intra-year movement in the timing of orders.

Outside North America On-Highway end market net sales were up 3 percent from the same period in 2016 principally driven by higher demand in India partially offset by lower demand in China and down 13 percent on a sequential basis principally driven by lower demand in Europe and China.

Outside North America Off-Highway end market net sales were up $3 million from the same period in 2016 principally driven by higher demand in the mining and energy sectors and up $2 million sequentially principally driven by higher demand in the mining sector.

Service Parts, Support Equipment and Other end market net sales were up 39 percent from the same period in 2016 and up 9 percent on a sequential basis principally driven by higher demand for North America service parts.

Gross profit for the quarter was $251 million, an increase of 17 percent from $215 million for the same period in 2016. Gross margin for the quarter was 50.3 percent, an increase of 380 basis points from a gross margin of 46.5 percent for the same period in 2016. The increase in gross profit from the same period in 2016 was principally driven by increased net sales, price increases on certain products and favorable manufacturing expense partially offset by higher incentive compensation expense, according to a press release.

Selling, general and administrative expenses for the quarter were $79 million, a decrease of $4 million from $83 million for the same period in 2016. The decrease was principally driven by favorable product warranty adjustments and 2016 stockholder activism expense partially offset by higher incentive compensation expense.

Engineering – research and development expenses for the quarter were $23 million, an increase of $2 million from $21 million for the same period in 2016. The increase was principally driven by higher incentive compensation expense.

Net income for the quarter was $83 million compared to $48 million for the same period in 2016. The increase was principally driven by increased gross profit, decreased interest expense and decreased selling, general and administrative expense partially offset by increased income tax expense.

First Quarter Non-GAAP Financial Measures

Adjusted EBITDA for the quarter was $192 million, or 38.5 percent of net sales, compared to $162 million, or 35.1 percent of net sales, for the same period in 2016. The increase was principally driven by increased net sales, price increases on certain products, favorable product warranty adjustments and favorable manufacturing expense partially offset by higher incentive compensation expense.

Adjusted Free Cash Flow for the quarter was $103 million compared to $113 million for the same period in 2016, a decrease of $10 million. The decrease was principally driven by increased accounts receivable commensurate with increased net sales and increased incentive compensation payments partially offset by increased gross profit and decreased cash interest expense.

Full Year 2017 Guidance Update

The updated full year 2017 guidance includes a year-over-year net sales increase in the range of 7.5 to 10.5 percent, an Adjusted EBITDA margin in the range of 34 to 36 percent, an Adjusted Free Cash Flow in the range of $415 to $455 million, capital expenditures in the range of $70 to $80 million, which includes maintenance spending of about $65 million, and cash income taxes in the range of $65 to $75 million.

Allison's full year 2017 net sales guidance reflects stronger demand for North America Off-Highway service parts and North America On-Highway products. The full year 2017 net sales outlook also assumes price increases on certain products and a modest recovery in the Global Off-Highway end markets.

Although Allison is not providing specific second quarter 2017 guidance, it does expect second quarter net sales to be up sequentially principally driven by increased demand in the Global On-Highway end markets.