Winnebago Industries is reporting lower-than-anticipated profits for its first quarter. Winnebago CEO Randy Potts cites additional labor costs and delayed delivery of supplies to make the recreational vehicles as the reasons.
“A lot of the labor constraints were caused by the supply chain issues and that can be a little bit confusing,” Potts says. “If the issue is in the supply chain oftentimes that disrupts the production process and the resolution to that is to work more hours to correct those issues and when you work more hours, you create these labor constraints, so it’s a multi-faceted issue that we dealt with in the first quarter.”
The Forest City-based motorhome manufacturer reported a profit of profit of $9.9 million or 37 cents per share in its first quarter. That compared with profits of $11.1 million during the same period a year ago or 40 cents a share. Market analysts had expected the company to post a profit of 45 cents a share in this year’s first quarter. Potts says they need more employees than they currently have, so the current staff is working more overtime.
“So you manage that using a lot of different tools,” Potts says. “In this particular case, while we were short some employees, it was exacerbated by having these other issues that disrupted production.”
Despite falling short of expectations, Potts says it still was a good quarter and 2014 was a good year for Winnebago.
“We need to keep that trend going, so we’ll be looking for every possibility to make 2015 a successful year, too,” Potts says.
Sales of Winnebago motorhomes rose nearly one percent, to $224.4 million. Shipments of motorhomes to dealers grew 1.3 percent in the quarter, while shipments of towable units rose nearly 13 percent.
(Reporting by Robert Fisher, KLSS, Mason City)