Winnebago Industries Inc. reported sales grew 34.8 percent in the first quarter ended November 28 and 22.0 percent excluding the acquisition of Newmar. Net earnings more than tripled.

First Quarter Fiscal 2021 Results
Revenues for the Fiscal 2021 first quarter ended November 28, 2020, were $793.1 million, an increase of 34.8 percent compared to $588.5 million for the Fiscal 2020 period, which included three weeks of Newmar performance. Fiscal 2021 first-quarter revenues excluding Newmar were $674.4 million, reflecting an increase of 22.0 percent when excluding revenues from Newmar in the same period of Fiscal 2020, driven by a strong end consumer demand.

Gross profit was $137.0 million, an increase of 74.3 percent compared to $78.6 million for the Fiscal 2020 period. Gross profit margin increased 390 basis points in the quarter to 17.3 percent, driven by operating leverage, motorhome segment productivity initiatives and lower discounts and allowances, partially offset by the dilutive impact of mix related to the Newmar acquisition.

Operating income was $85.0 million for the quarter, an increase of 255.8 percent compared to $23.9 million for the first quarter of last year.

Fiscal 2021 first-quarter net income was $57.4 million, an increase of 308.2 percent compared to $14.1 million in the prior-year quarter. Reported earnings per diluted share were $1.70 compared to reported earnings per diluted share of $0.44 in the same period last year. Adjusted earnings per diluted share were $1.69, an increase of 131.5 percent compared to adjusted earnings per diluted share of $0.73 in the same period last year.

Adjusted EBITDA was $89.3 million for the quarter, compared to $42.0 million last year, an increase of 112.4 percent.

President and CEO Michael Happe commented, “Winnebago Industries’ first-quarter results underscore the strength of our unmatched portfolio of leading brands and continued demand from the end consumer for our high quality, innovative outdoor products. The momentum we are seeing across our segments allowed us to capture the full value of our products in the marketplace, while continuing to gain market share. Our strong profit performance — including significant margin expansion —reflects the hard work and focus of our world-class Winnebago Industries team, which has maintained a commitment to operational excellence and safely manufacturing our products with a steadfast dedication to quality. We especially remain focused on continuing to deliver for our dealer partners, working hard to replenish their inventories, while ensuring strong financial performance and flexibility for both parties during these dynamic times. Interest in the outdoors is not waning and in fact, appears to be strengthening heading into the calendar year 2021, and Winnebago Industries is positioned well to maximize value for our employees, end customers, dealers, and shareholders.”

Towable
Revenues for the Towable segment were $454.9 million for the first quarter, up 33.3 percent over the prior year, primarily driven by the strong continued end consumer demand for its Grand Design and Winnebago product lines. Segment Adjusted EBITDA was $63.1 million, up 76.5 percent over the prior-year period. Adjusted EBITDA margin of 13.9 percent increased 340 basis points, primarily due to lower discounts and allowances and operating leverage during the quarter. Backlog increased to 29,659 units, an increase of 313.4 percent over the prior-year period, as dealer inventories have experienced a significant reduction amidst heightened levels of consumer retail demand since the summer of 2020.

Motorhome
Revenues for the Motorhome segment were $322.4 million for the first quarter, up 42.7 percent from the prior year, driven by the addition of Newmar and strong Winnebago Class B products. Excluding Newmar, segment revenues were $203.6 million, an increase of 7.0 percent over the prior-year period. Segment Adjusted EBITDA was $30.3 million, up 225.2 percent from the prior year. Adjusted EBITDA margin of 9.4 percent increased 530 basis points driven by pricing actions, including lower discounts and allowances, productivity initiatives and operating leverage. Backlog increased to 13,217 units, an increase of 402.4 percent over the prior-year period, as dealer inventories have experienced a significant reduction amidst heightened levels of consumer retail demand in the last six months.

Balance Sheet and Cash Flow
As of November 28, 2020, the company had total outstanding debt of $516.5 million ($600.0 million of debt, net of convertible note discount of $70.9 million, and net of debt issuance costs of $12.5 million) and working capital of $475.0 million. Cash flow from operations was an outflow of $2.7 million in the first quarter of Fiscal 2021, as inventory levels have increased in response to very strong dealer orders and heightened backlog position.

Quarterly Cash Dividend
On December 16, 2020, the Company’s board of directors approved a quarterly cash dividend of $0.12 per share payable on January 27, 2021, to common stockholders of record at the close of business on January 13, 2021.

Happe continued, “During the first quarter we unveiled a refreshed Winnebago Industries enterprise brand, that reflects our status as a fast-growing company with a portfolio of premium outdoor brands. While proud of our iconic flagship Winnebago-brand RVs, the parent organization, Winnebago Industries, also reflects our pride in having the Grand Design, Newmar, and Chris-Craft businesses as part of our family and the aspiration that all our employees and end customers share together to “Be Great, Outdoors”. Our recently published 2020 Corporate Responsibility report reinforces our six core cultural values and outlines the actions we have taken to enhance sustainability and support the communities in which our stakeholders live, work, and play. I am exceptionally proud of our team’s efforts in not only delivering fantastic results, but also driving positive change within our organization and neighborhoods. Throughout the remainder of Fiscal Year 2021, Winnebago Industries will be focused on building upon our market momentum, and doing good in the social arena as well. We are confident that the favorable industry dynamics in the RV and marine markets and the unique appeal of our innovative products will continue to drive market share gains and strong financial results.”

Photo courtesy Winnebago Industries