Increased sales of towable recreational vehicles are boosting profits for Forest City-based Winnebago Industries.
The company’s total number of motor homes delivered increased 3 percent for the company’s fiscal fourth quarter while deliveries of towable campers jumped 58 percent and deliveries of mid-size models shot up 59 percent. For the quarter ending in August, Winnebago posted a profit of $13.1 up from $11.7 for the same period one year ago.
Winnebago CEO Michael Happe says the sales of the towables continue to gain momentum with every month and quarter. He says towables, wholesale deliveries and retail registrations, both improved more than 50 percent for the quarter. “Our product line continues to evolve positively, and we are focused on expanding our dealer network in terms of both quantity and quality of channel partners. We are especially seeing strong end customer demand for our travel-trailer lines, especially our “Mini” branded products.”
Happe says the number of motor home orders has increased substantially over the last two months. He says the towable backlog remains strong as of today, while the motorized backlog position has improved substantially with 50 percent more orders in hand today than at the end of August. Today’s financial report follows the announcement earlier this month that Winnebago will be acquiring Grand Design, an Indiana-based manufacturer of towable RVs.
Happe says the company’s excitement level continues to be high about the purchase. He says they’ll immediately enhance their product penetration with a sweep of some of the industry’s strongest towable floor plans. “Winnebago as a whole gains scale, possesses a broader catalog of product, and mitigates a bit of cyclicality pressure due to a much more balanced portfolio in terms of motor homes versus towable sales.”
Happe says they’ve spoken with many industry stakeholders about the Grand Design acquisition, and he says most all have validated that it appears to be a strong fit for both companies. He says from a brand perspective, they’ve added the hottest set of product labels in the towables category, and they’re gaining some of the best operators in the RV industry. “They will bring a tremendous amount of expertise, passion, and additional unique points of view to our key leadership team. They care for each other and their customers, similar to that of Winnebago.”
Fiscal year 2016 revenues slightly decreased compared to Fiscal 2015, down from $976.5 million to $975.2 million. Net income for the company though was over 4 million dollars higher for the year to $45.5 million, primarily due to lower raw material costs.
(Reporting by Bob Fisher, KRIB, Mason City)