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 .
Wed Dec 20, 2017
FOREST CITY, Iowa—Winnebago Industries Inc. announced that its motorized segment declined by 2 percent in the first quarter of fiscal 2018, while the towables segment increased by more than 50 percent. Total revenues for the first quarter increased by 83.5 percent.
Revenues for the fiscal 2018 first quarter, which ended Nov. 25 were $450 million, an increase of 83.5 percent compared to $245.3 million for the Fiscal 2017 period, which included three weeks of Grand Design RV performance. Gross profit was $62.8 million, an increase of 117.6 percent compared to $28.9 million for the Fiscal 2017 period. Gross profit margin increased 220 basis points in the quarter, driven by the continuation of accelerated growth in the more profitable Towable segment. Operating income was $31.2 million for the quarter, an improvement of 69.4 percent compared to $18.4 million in the first quarter of last year. Fiscal 2018 first quarter net income was $18 million, an increase of 53 percent compared to $11.7 million in the same period last year. Earnings per diluted share were $0.57, an increase of 36 percent compared to earnings per diluted share of $0.42 in the same period last year.
“We are on a mission here to restore our flagship brand and our company to market and financial leadership,” Winnebago President and CEO Michael Happe said in the company’s conference call on Wednesday. “It was an immense year of transition as we worked to plant seeds for the future. Our consolidated results both in market and financially are reflective of our net progress we’re making. We are a healthier, more profitable RV competitor with significantly more runway ahead of us.”
Towable revenues increased by $209.5 million over the prior year and the towable segment represents more than 57 percent of the company’s revenues, Happe says. One of the largest reasons of the large increase in towables was the acquisition of Grand Design RV, which passed its one-year anniversary in November.
“We couldn’t be more pleased of the integration of Grand Design into our corporate portfolio,” Happe says. “Grand Design continues to drive superlative performance and set the bar. The Grand Design business and brands achieved the Quality Circle Award in the dealer satisfacdtion survey and was at the very top of the industry scoring for this award. We are just as excited with our other towables business. Our growth outpaces the market with revenue increases over 50 percent and backlog that grows steadily. The profitability is heading in the right direction.”
The motorized revenues were $190.4 million, down 2.4 percent from the previous year’s first quarter. While units and shipments rose for the company, several other factors contributed in the drop in the revenues.
“Our performance in the motorized segment was disappointing,” Happe says. “Some of the primary challenges were rising material costs and the ongoing expenses of our Oregon facility. We are very focused on some foundational changes. We are focused on making more impactful product development and establishing a manufacturer base that is more geographically diverse. However, these changes are placing more near-term pressure on our bottom line as we reposition for the future. We believe we are seeing progress as some new, exciting products are hitting the street. We have been clear that the fiscal year 2018 is a key year for the motorized segment to find its legs financially and with our customers. Clearly, we have work to do here. Overall, the consolidated results represent a strong step forward in many ways.”
Winnebago has introduced several new RVs in 2017, including the Intent, Revel, Horizon and the Minnie Plus Fifth Wheel. Additionally, Grand Design will be introducing the Transcend Travel Trailer, which will go into production during the second quarter of 2018.
Happe referenced RVIA President Frank Hugelmeyer’s comments at the National RV Trade Show in Louisville, Kentucky and the projected numbers of shipments for 2017 and 2018.
“The North American RV industry continues to grow and reach historic shipment levels,” Happe says. “The association projected more than half a million RVs shipped in the United States alone, which represents the eighth consecutive year of recovery. While never completely certain, it appears that prospects for a ninth consecutive year of growth is not only possible, it’s probable. Winnebago has never been better positioned to take advantage of this growth. 2018 is off to great start. This is still a product business and Winnebago teams and brands are looking to set the pace of competition with these new products.”
Winnebago also spoke about the three active expansion projects underway in the conference call. The projects include the type A diesel facility in Junction City, Oregon. Secondly, it includes the construction project on the Grand Design campus which will add 40 percent more square footage space for lamination capacity and assembly line space for the new release of the Transcend. Finally, it will include an added facility for the Winnebago Towables project that will begin in early fiscal year 2019.