UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition
On March 9, 2021, THOR Industries, Inc. (the "Company") issued a press release announcing certain financial results for the second quarter ended January 31, 2021. A copy of the Company's press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein. The Company also posted an updated investor slide presentation and a list of investor questions and answers to the "Investors" section of its website. A copy of the Company's slide presentation and investor questions and answers are attached hereto as Exhibit 99.2 and 99.3, respectively, and are incorporated by reference herein.
Item 7.01 Regulation FD Disclosure
The slide presentation attached hereto as Exhibit 99.2, and incorporated by reference herein, also provides updated information on industry wholesale shipments and retail market share. The Company also posted an updated list of investor questions and answers to the "Investors" section of its website. A copy of the Company's investor questions and answers is attached hereto as Exhibit 99.3 and is incorporated by reference herein.
In accordance with general instruction B.2 to Form 8-K, the information set forth in Items 2.02 and 7.01 of this Form 8-K (including Exhibits 99.1, 99.2 and 99.3) shall be deemed "furnished" and not "filed" with the Securities and Exchange Commission for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and shall not be incorporated by reference into any filing thereunder or under the Securities Act of 1933, as amended.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits |
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Exhibit Number |
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99.1 |
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Copy of press release, dated March 9, 2021, issued by the Company |
99.2 |
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Copy of investor slide presentation, posted on the Company's website on March 9, 2021 |
99.3 |
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Copy of investor questions and answers posted on the Company's website on March 9, 2021 |
104 |
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Cover Page Interactive Date File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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Thor Industries, Inc. |
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Date: |
March 9,2021 |
By: |
/s/ Colleen Zuhl |
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Name: |
Colleen Zuhl |
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Title: |
Senior Vice President and Chief Financial Officer |
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Exhibit 99.1
Thor Industries Net Sales Up 36%, Gross Profit Margin Improved By 240 Basis Points And Earnings Per Share Up 358% For The Second Quarter Of Fiscal 2021
ELKHART, Ind., March 9, 2021 /PRNewswire/ -- THOR Industries, Inc. (NYSE: THO) today announced record results for the second fiscal quarter ended January 31, 2021.
"In our quarter ended January 31, 2021, we delivered record results for a fiscal second quarter, which is typically our lowest sales quarter. We generated sizeable growth in the key metrics of net sales, gross margin and earnings per share. Demand for our products continued to be extremely strong, as evidenced by the increase in our backlog, which set a record of $10.81 billion as of January 31, 2021," said Bob Martin, President and CEO of THOR Industries.
"We are aggressively working to meet this demand by selectively and strategically expanding production capacity at numerous plants by reconfiguring them or adding additional production lines and the requisite inventory while managing through temporary supply chain limitations. In addition, we have increased production levels across the vast majority of our plants. We are focused on balancing volume with quality output and being mindful not to over expand our production capabilities," added Martin.
Second-Quarter Financial Results
Second-quarter net sales were $2.73 billion, compared to $2.00 billion in the second quarter of fiscal 2020. This year's second quarter net sales include $1.37 billion for the North American Towable RV segment, $577.0 million for the North American Motorized RV segment and $733.5 million for the European RV segment.
Consolidated gross profit margin increased 240 basis points to 15.2% for the second quarter of fiscal 2021, compared to 12.8% in the corresponding period a year ago. The increase in the consolidated gross profit percentage was primarily due to the impact of the increase in net sales in the current-year period compared to the prior-year period and gross margin cost percentage improvements noted below, partially offset by the negative impact of $4.3 million related to the step-up in assigned value of recently acquired Tiffin Group inventory included in cost of products sold during the current-year period.
Net income attributable to THOR and diluted earnings per share for the second quarter of fiscal 2021 were $132.5 million and $2.38, respectively, compared to net income attributable to THOR and diluted earnings per share of $28.7 million and $0.52, respectively, in the prior-year period.
The Company's effective income tax rate for the second quarter of fiscal 2021 was 20.0% compared with 22.5% for the second quarter of fiscal 2020. The primary driver of the decrease in the effective tax rate between comparable periods was certain favorable foreign return-to-provision adjustments recorded in the three months ended January 31, 2021. The Company estimates its effective income tax rate for fiscal 2021 will be between 20% and 23% before consideration of any discrete tax items. The actual effective income tax rate will be dependent upon the mix of foreign and domestic pretax earnings and subject to the impact of foreign currency exchange rates.
Segment Results
North American Towable RVs
North American Motorized RVs
European RVs
"Our continued improvement in financial performance demonstrates our ability to effectively and efficiently ramp up production volumes in response to surging demand while managing our expenses to achieve improved margins and net income in an unusually complex operating environment," said Colleen Zuhl, THOR's Senior Vice President and Chief Financial Officer.
"Historically, our cash flow is seasonal, as we use cash to build inventory during our first and second fiscal quarters in preparation for the typical increase in demand for our products during the second half of the fiscal year. Net cash used by operating activities for the first half of fiscal 2021 was $88.6 million compared to cash provided by operating activities of $5.3 million in the first half of fiscal 2020. This year, at January 31, 2021, we have the added complexity of carrying additional chassis and other inventory due to new product introductions, increased production, and higher work-in-process levels due to ongoing supply chain constraints. We expect overall working capital levels to remain elevated given the strong market demand, but expect our work-in-process inventory to approach more normalized levels during the second half of the fiscal year.
"We continue to have strong liquidity with $183.6 million of cash and cash equivalents as of January 31, 2021, and approximately $507.0 million available for borrowing under our ABL. At January 31, 2021, we had borrowings outstanding on our ABL of $213.6 million, which consisted of $165.0 million borrowed in connection with the Tiffin Group acquisition and the remainder utilized for European working capital. Subsequent to the end of our second fiscal quarter, we paid $47.1 million on the outstanding ABL balance. We expect to repay all of the borrowings under the ABL by the end of our fiscal year.
"Our cash utilization priorities remain consistent with our historical priorities, namely, investing in our businesses, paying our dividends, further reducing our acquisition-related debt obligations and funding strategic acquisition opportunities to enhance long-term shareholder value. Regarding investing in our business, we expect our total capital expenditures for the full year of fiscal 2021 to be approximately $150 million, reflecting the increased demand for our products in the marketplace which is driving near-term investments in production capacity expansion and reflecting investments in long-term initiatives that we expect will result in growth and market share gains for THOR over time," concluded Zuhl.
Q2 Summary
"Throughout the quarter we continued to focus first on the health of our employees. We continue to maintain robust COVID-19 protocols and will continue to do so for as long as necessary for the benefit of our employees, their families and the communities in which we work and live. Our management teams throughout the THOR organization continue to do an amazing job of managing safety protocols while increasing production volumes needed to meet dealer demand for our family of products and working through ongoing supply chain constraints. Our record financial results are a direct outcome of the efforts of our global team members, and I am proud of what the team accomplished during the first half of the fiscal year for THOR," said Bob Martin.
"During the quarter, we also acquired the Tiffin Group, comprised of Tiffin Motorhomes, Vanleigh RV and a number of related supply entities. This acquisition is in direct alignment with THOR's long-term strategic growth plan. The Tiffin Group brings great people, great products, and great potential for further growth and geographical expansion to THOR and we are thrilled to have them on our team," added Martin.
Outlook
"Our outlook for the remainder of our fiscal year is for continued strength in the RV industry, but we still must manage through temporary supply chain issues which may limit the level to which we can increase output in the near term. We experienced delays in chassis deliveries and other supply chain constraints from our European suppliers during the first half of our fiscal year primarily due to pandemic related challenges, and we anticipate these challenges will continue for the next few quarters. Within North America, we also continue to experience supply constraints and shortages of various RV component parts due to pandemic-related challenges, and the recent harsh weather conditions in the southern United States which has impacted the availability of certain petroleum-based components. We anticipate these supply chain challenges will continue to impact us in the near term and are cautiously optimistic that these constraints will lessen in the back half of calendar 2021," continued Martin.
"In the near-term, which we define as the remainder of calendar 2021, we see demand for our products outpacing supply. Our backlog is at record levels and is continuing to grow. To manage this growth, we are strategically investing in our business to increase production capacity while enhancing our quality processes.
"In calendar 2022, we expect to transition from shipping product to meet immediate end customer demand to a dealer restocking cycle. During this stage, we expect to be shipping product that will rebuild dealer inventories to more historically normal levels. Many dealers in both North America and Europe are currently significantly below historical inventory levels in relation to historical demand, so we expect this restocking cycle will take a number of quarters to complete, given that we still anticipate strong end customer demand in calendar 2022. In the longer-term, which we define as late calendar 2022 and beyond, we expect to get back to a more normal ordering cycle where dealers order to replenish sold stock.
"The tangible evidence supporting our outlook and the continued expansion of the industry beyond the pandemic include a number of items. First, Millennials, a market bigger than the baby boomers, are buying RVs earlier than previous generations. Historically, consumers that enjoy the RV lifestyle trade in, and often up, every 3 to 5 years. Next, work from home means work from anywhere, including in your RV. We are seeing the pandemic work-at-home trend turning into a lifestyle choice as more and more people choose RVs as their mobile office.
"Ongoing dealer consolidation also demonstrates a positive long-term outlook from the large dealers. Dealers are investing heavily in additional service centers and destination show rooms, all to support the current and anticipated larger end-consumer base.
"Significant investments are also being made in outdoor camping facilities, RV rental and RV sharing companies, and RV booking sites, again to support the increasing number of RVers now and in the years to come. Notably, the Great America Outdoors Act was recently approved by Congress. This Act enables federal land managers to take aggressive steps to address deferred maintenance and other infrastructure projects on national forests and grasslands. With enhanced opportunities to visit and camp on National parks and forests, we anticipate further demand from consumers for RVs.
"These are just a few of the factors that we believe will drive THOR's RV sales, and growth in the RV industry, in the long term. We also believe that investments we are making in innovation will motivate the users of our products to trade-in or trade-up on a regular cadence.
"Just last week, the RVIA issued their updated 2021 forecast which projects total North American wholesale RV shipments will grow by approximately 24% in calendar 2021, to approximately 533,400 units compared to 430,412 units in calendar 2020. We concur with this forecast and believe there is potential upside to RVIA's numbers based on current conditions. Consumers continue to show that they appreciate the value proposition RVs offer – affordability, a vacation in a controlled environment, freedom, and outdoor fun. The desire by consumers to control their own destiny and have safer, socially distanced vacation activities has only added to the demand for RVs," concluded Martin.
Supplemental Earnings Release Materials
THOR has provided a comprehensive question and answer document, as well as a PowerPoint presentation, relating to its quarterly results and other topics. To view these materials, go to http://ir.thorindustries.com.
About THOR Industries, Inc.
THOR is the sole owner of operating subsidiaries that, combined, represent the world's largest manufacturer of recreational vehicles. For more information on the Company and its products, please go to www.thorindustries.com.
Forward-Looking Statements
This release includes certain statements that are "forward-looking" statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made based on management's current expectations and beliefs regarding future and anticipated developments and their effects upon THOR, and inherently involve uncertainties and risks. These forward-looking statements are not a guarantee of future performance. We cannot assure you that actual results will not differ materially from our expectations. Factors which could cause materially different results include, among others: the extent and impact from the continuation of the COVID-19 pandemic, along with the responses to contain the spread of the virus by various governmental entities or other actors, which may have negative effects on retail customer demand, our independent dealers, our supply chain, our labor force, our production or other aspects of our business and which may have a negative impact on our consolidated results of operations, financial position, cash flows and liquidity; the ability to ramp production up or down quickly in response to rapid changes in demand while also managing costs and market share; the effect of raw material and commodity price fluctuations, and/or raw material, commodity or chassis supply constraints; the impact of tariffs on material or other input costs; the level and magnitude of warranty claims incurred; legislative, regulatory and tax law and/or policy developments including their potential impact on our dealers and their retail customers or on our suppliers; the costs of compliance with governmental regulation; legal and compliance issues including those that may arise in conjunction with recently completed transactions; lower consumer confidence and the level of discretionary consumer spending; interest rate fluctuations and their potential impact on the general economy and, specifically, on our dealers and consumers; the impact of exchange rate fluctuations; restrictive lending practices which could negatively impact our independent dealers and/or retail consumers; management changes; the success of new and existing products and services; the ability to efficiently utilize existing production facilities; changes in consumer preferences; the risks associated with acquisitions, including: the pace and successful closing of an acquisition, the integration and financial impact thereof, the level of achievement of anticipated operating synergies from acquisitions, the potential for unknown or understated liabilities related to acquisitions, the potential loss of existing customers of acquisitions and our ability to retain key management personnel of acquired companies; a shortage of necessary personnel for production and increasing labor costs to attract production personnel in times of high demand; the loss or reduction of sales to key dealers; disruption of the delivery of units to dealers; increasing costs for freight and transportation; asset impairment charges; cost structure changes; competition; the impact of potential losses under repurchase or financed receivable agreements; the potential impact of the strength of the U.S. dollar on international demand for products priced in U.S. dollars; general economic, market and political conditions in the various countries in which our products are produced and/or sold; the impact of changing emissions and other regulatory standards in the various jurisdictions in which our products are produced, used and/or sold; changes to our investment and capital allocation strategies or other facets of our strategic plan; and changes in market liquidity conditions, credit ratings and other factors that may impact our access to future funding and the cost of debt.
These and other risks and uncertainties are discussed more fully in our Quarterly Report on Form 10-Q for the quarter ended January 31, 2021 and in Item 1A of our Annual Report on Form 10-K for the year ended July 31, 2020.
We disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this release or to reflect any change in our expectations after the date hereof or any change in events, conditions or circumstances on which any statement is based, except as required by law.
THOR INDUSTRIES, INC. | ||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||||||||||||||||||
FOR THE THREE AND SIX MONTHS ENDED JANUARY 31, 2021 AND 2020 | ||||||||||||||||||||
($000's except share and per share data) (Unaudited) | ||||||||||||||||||||
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| Three Months Ended January 31, |
| Six Months Ended January 31, | ||||||||||||||||
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| 2021 | % Net
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| 2020 | % Net
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| 2021 | % Net
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| 2020 | % Net
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Net sales |
| $ | 2,727,788 |
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| $ | 2,003,133 |
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| $ | 5,265,148 |
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| $ | 4,161,918 |
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Gross profit |
| $ | 414,877 |
| 15.2% |
| $ | 256,406 |
| 12.8% |
| $ | 793,729 |
| 15.1% |
| $ | 565,217 |
| 13.6% |
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Selling, general and administrative expenses |
| 206,189 |
| 7.6% |
| 162,357 |
| 8.1% |
| 387,952 |
| 7.4% |
| 350,821 |
| 8.4% | ||||
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Amortization of intangible assets |
| 29,203 |
| 1.1% |
| 24,273 |
| 1.2% |
| 56,630 |
| 1.1% |
| 48,566 |
| 1.2% | ||||
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Impairment charges |
| — |
| —% |
| 10,057 |
| 0.5% |
| — |
| —% |
| 10,057 |
| 0.2% | ||||
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Interest expense, net |
| 23,962 |
| 0.9% |
| 26,260 |
| 1.3% |
| 47,920 |
| 0.9% |
| 53,310 |
| 1.3% | ||||
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Other income, net |
| 8,436 |
| 0.3% |
| 1,404 |
| 0.1% |
| 9,051 |
| 0.2% |
| 1,034 |
| —% | ||||
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Income before income taxes |
| 163,959 |
| 6.0% |
| 34,863 |
| 1.7% |
| 310,278 |
| 5.9% |
| 103,497 |
| 2.5% | ||||
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Income taxes |
| 32,769 |
| 1.2% |
| 7,837 |
| 0.4% |
| 63,449 |
| 1.2% |
| 24,626 |
| 0.6% | ||||
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Net income |
| 131,190 |
| 4.8% |
| 27,026 |
| 1.3% |
| 246,829 |
| 4.7% |
| 78,871 |
| 1.9% | ||||
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Less: net income (loss) attributable to non-controlling interests |
| (1,334) |
| —% |
| (1,647) |
| (0.1)% |
| 548 |
| —% |
| (867) |
| —% | ||||
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Net income attributable to THOR Industries, Inc. |
| $ | 132,524 |
| 4.9% |
| $ | 28,673 |
| 1.4% |
| $ | 246,281 |
| 4.7% |
| $ | 79,738 |
| 1.9% |
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Earnings per common share |
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Basic |
| $ | 2.39 |
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| $ | 0.52 |
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| $ | 4.45 |
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| $ | 1.45 |
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Diluted |
| $ | 2.38 |
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| $ | 0.52 |
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| $ | 4.43 |
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| $ | 1.44 |
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Weighted-avg. common shares outstanding – basic |
| 55,366,241 |
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| 55,198,756 |
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| 55,302,203 |
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| 55,146,915 |
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Weighted-avg. common shares outstanding – diluted |
| 55,568,667 |
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| 55,396,116 |
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| 55,561,675 |
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| 55,310,385 |
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(1) Percentages may not add due to rounding differences |
SUMMARY CONDENSED CONSOLIDATED BALANCE SHEETS ($000) (Unaudited) | ||||||||||||||||||
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| January 31, 2021 |
| July 31, 2020 |
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| January 31, 2021 |
| July 31, 2020 | ||||||||
Cash and equivalents |
| $ | 186,547 |
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| $ | 541,363 |
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| Current liabilities |
| $ | 1,672,407 |
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| $ | 1,515,281 |
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Accounts receivable, net |
| 943,966 |
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| 814,227 |
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| Long-term debt |
| 1,821,522 |
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| 1,652,831 |
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Inventories, net |
| 1,300,185 |
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| 716,305 |
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| Other long-term liabilities |
| 278,906 |
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| 257,779 |
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Prepaid expenses and other |
| 64,851 |
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| 30,382 |
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| Stockholders' equity |
| 2,596,711 |
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| 2,345,569 |
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Total current assets |
| 2,495,549 |
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| 2,102,277 |
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Property, plant & equipment, net |
| 1,132,722 |
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| 1,107,649 |
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Goodwill |
| 1,581,990 |
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| 1,476,541 |
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Amortizable intangible assets, net |
| 1,009,431 |
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| 914,724 |
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Deferred income taxes and other, net |
| 149,854 |
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| 170,269 |
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Total |
| $ | 6,369,546 |
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| $ | 5,771,460 |
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| $ | 6,369,546 |
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| $ | 5,771,460 |
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Contact
Investor Relations:
Mark Trinske, Vice President of Investor Relations
mtrinske@thorindustries.com
(574) 970-7912
SECOND QUARTER OF FISCAL 2021 FINANCIAL RESULTS Exhibit 99.2
Forward-Looking Statements This presentation includes certain statements that are “forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made based on management’s current expectations and beliefs regarding future and anticipated developments and their effects upon THOR, and inherently involve uncertainties and risks. These forward-looking statements are not a guarantee of future performance. We cannot assure you that actual results will not differ materially from our expectations. Factors which could cause materially different results include, among others: the extent and impact from the continuation of the COVID-19 pandemic, along with the responses to contain the spread of the virus by various governmental entities or other actors, which may have negative effects on retail customer demand, our independent dealers, our supply chain, our labor force, our production or other aspects of our business and which may have a negative impact on our consolidated results of operations, financial position, cash flows and liquidity; the ability to ramp production up or down quickly in response to rapid changes in demand while also managing costs and market share; the effect of raw material and commodity price fluctuations, and/or raw material, commodity or chassis supply constraints; the impact of tariffs on material or other input costs; the level and magnitude of warranty claims incurred; legislative, regulatory and tax law and/or policy developments including their potential impact on our dealers and their retail customers or on our suppliers; the costs of compliance with governmental regulation; legal and compliance issues including those that may arise in conjunction with recently completed transactions; lower consumer confidence and the level of discretionary consumer spending; interest rate fluctuations and their potential impact on the general economy and, specifically, on our dealers and consumers; the impact of exchange rate fluctuations; restrictive lending practices which could negatively impact our independent dealers and/or retail consumers; management changes; the success of new and existing products and services; the ability to efficiently utilize existing production facilities; changes in consumer preferences; the risks associated with acquisitions, including: the pace and successful closing of an acquisition, the integration and financial impact thereof, the level of achievement of anticipated operating synergies from acquisitions, the potential for unknown or understated liabilities related to acquisitions, the potential loss of existing customers of acquisitions and our ability to retain key management personnel of acquired companies; a shortage of necessary personnel for production and increasing labor costs to attract production personnel in times of high demand; the loss or reduction of sales to key dealers; disruption of the delivery of units to dealers; increasing costs for freight and transportation; asset impairment charges; cost structure changes; competition; the impact of potential losses under repurchase or financed receivable agreements; the potential impact of the strength of the U.S. dollar on international demand for products priced in U.S. dollars; general economic, market and political conditions in the various countries in which our products are produced and/or sold; the impact of changing emissions and other regulatory standards in the various jurisdictions in which our products are produced, used and/or sold; changes to our investment and capital allocation strategies or other facets of our strategic plan; and changes in market liquidity conditions, credit ratings and other factors that may impact our access to future funding and the cost of debt. These and other risks and uncertainties are discussed more fully in our Quarterly Report on Form 10-Q for the quarter ended January 31, 2021 and in Item 1A of our Annual Report on Form 10-K for the year ended July 31, 2020. We disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this presentation or to reflect any change in our expectations after the date hereof or any change in events, conditions or circumstances on which any statement is based, except as required by law.
Overview Second Fiscal Quarter 2021* In the near-term, which we define as the remainder of calendar 2021, we see demand for our products outpacing supply. Our backlog is at record levels and is continuing to grow. To manage this growth, we are strategically investing in our business to increase production capacity while enhancing our quality processes. We believe that THOR, and the RV industry, will continue to expand well after the pandemic officially ends. Bob Martin, President and CEO of THOR Industries NET SALES +36% GROSS PROFIT MARGIN +240 basis points EARNINGS PER SHARE +358% POSITIVE OUTLOOK for long-term growth *All comparisons within this presentation are to the Second Quarter of Fiscal 2020, unless otherwise noted
Quarterly Highlights European 26.9% $0.73 bn NA Motorized 21.2% $0.58 bn NA Towables 50.3% $1.37 bn Other 1.6% $0.04 bn 15.2% Gross Margin $2.38 Diluted EPS North American Independent Dealer Inventory of THOR Products RV Backlog $10.8 billion +276.2% Net Sales $2.73 billion Second Fiscal Quarter 2021 +36% +240 bps +358% * * Includes 700 units of Tiffin products ** ** Includes Tiffin backlog of $553.0 mm at January 31, 2021
Net Sales Net sales increased 36.2% to $2.73 billion in the second quarter of fiscal 2021 compared to the prior-year period, due to increased unit shipments across the business segments and the inclusion of $82.4 million of net sales of Tiffin Group since the December 18, 2020 acquisition date Gross Profit Gross profit increased 61.8% to $414.9 million in the second quarter of fiscal 2021 compared to the prior-year period Gross profit margin improved to 15.2% in the second quarter of fiscal 2021 from 12.8% in the prior-year period, primarily due to the impact of the increase in net motorized and towable RV sales, improved material, overhead and warranty cost percentages, partially offset by higher labor costs due to the current competitive RV labor market conditions in northern Indiana and the negative impact of $4.3 million related to the step-up in assigned value of recently acquired Tiffin Group inventory included in costs of products sold during the current-year period Financial Results Second Quarter of Fiscal 2021
Net Sales Net sales of North American Towable RVs increased 39.6% in the second quarter of fiscal 2021 compared to the prior-year period, driven primarily by an increase in unit shipments Gross Profit Margin Gross profit margin increased 330 basis points in the fiscal second quarter compared to the prior-year period, driven by the impact of the increase in net towable RV sales, reduced sales discounts as well as favorable warranty experience trends, partially offset by an increase in labor costs $5.3 billion in Backlog North American Towable backlog at January 31, 2021 increased approximately 454% compared to January 31, 2020 As of January 31, 2021, dealer inventory levels were well below optimal stocking levels, which has increased dealer orders and THOR's backlog Second Quarter of Fiscal 2021 North American Towable Segment
Net Sales Fiscal 2021 second quarter net sales of North American Motorized RVs increased 67.9% compared to the prior-year period, driven primarily by an increase in unit shipments and the inclusion of $74.6 million of net sales of Tiffin Group since the December 18, 2020 acquisition date Gross Profit Margin Gross profit margin increased 300 basis points in the fiscal second quarter compared to the prior-year period, driven by the impact of the increase in net motorized RV sales, reduced sales discounts as well as favorable warranty experience trends, partially offset by an increase in labor costs and the negative impact of $3.9 million related to the step-up in assigned value of recently acquired Tiffin Group inventory included in costs of products sold during the current-year period $2.9 billion in Backlog North American Motorized backlog at January 31, 2021 increased approximately $2.13 billion, or 272%, compared to January 31, 2020, including $520.8 million of additional motorized backlog from the recently acquired Tiffin Group North American Motorized Segment Second Quarter of Fiscal 2021
Net Sales European RV segment net sales for the fiscal second quarter increased 15.1% from the prior-year period, driven primarily by an increase in the overall net price per unit due to the impact of changes in product mix, an increase in unit shipments and a favorable impact from year-over-year changes in foreign currency exchange rates Second Quarter of Fiscal 2021 Gross Profit Margin Gross profit margin increased by 40 basis points in the fiscal second quarter compared to the prior-year period, primarily due to slight reductions in labor and warranty cost percentages $2.6 billion in Backlog THOR’s European RV backlog at January 31, 2021 increased $1.50 billion, or nearly 132%, compared to January 31, 2020 European Segment
(1) Source: Statistical Surveys, Inc., U.S. and Canada; Calendar Years 2020 and 2019 (2) Source: Recreation Vehicle Industry Association, Calendar Year 2020 (3) Source: The Conference Board, Consumer Confidence Survey®, through December 2020 (4) Tiffin Motorhomes is not included in THOR full-year RV market share data, but is included in "All Others" for all periods presented 2020 Industry Wholesale Shipments by Type (2) Consumer Confidence vs. RV Retail Registrations Full-Year RV Retail Market Share (1)(4) RV Industry Overview North America THOR Forest River Winnebago Grand Design REV Group Gulfstream All Others 2020 Towable 461,495 units 2020 Motorized 52,641 units 2019 Motorized 52,053 units 2019 Towable 408,965 units 38.6% 41.5% 37.0% 44.9% 39.0% 19.8% 8.8% 1.3% 8.0% 1.4% 20.8% 7.4% 13.4% 7.9% 7.5% 37.1% 1.1% 1.5% 15.1% 21.2% 19.7% 7.0%
RV Wholesale Market Trends (Units 000's) Towable RV Wholesale Market Trends (Units 000's) Motorized RV Wholesale Market Trends (Units 000's) Historical Data: Recreation Vehicle Industry Association (RVIA) (e) Calendar year 2021 represents the most recent RVIA "most likely" estimate from their February 2021, Spring 2021 issue of Roadsigns 5-year CAGR: 2.8% 5-year CAGR: 3.6% 5-year CAGR: (2.9)% RV Industry Overview North America
(1) Source: European Caravan Federation; Calendar Years 2020 and 2019; European retail registration data available at www.CIVD.de (2) Source: Statistical Surveys (www.statisticalsurveys.com) European Industry Unit Registrations by Country (1) The Company monitors retail trends in the European RV market as reported by the European Caravan Federation, whose industry data is reported to the public quarterly, typically issued on a one-to-two month lag, continually updated and often impacted by delays in reporting by various countries Industry wholesale shipment data for the European RV market is not available Calendar Year Registrations Full-Year Comparison of New Vehicle Registrations by Continent (Units 000's) (1) (2) RV Industry Overview Europe
Capital Management ($ millions) Cash Priorities Fund opportunistic strategic investments, including acquisitions, to enhance long-term shareholder value Repurchase of shares on a strategic and opportunistic basis, and payment of special dividends as determined by our Board of Directors Reduce our acquisition-related debt obligations Pay our dividend Invest in our businesses Annual FY21 capital expenditures projected to be approximately $150 million reflecting the increased demand for our products in the marketplace which is driving near-term investments in production capacity expansion and reflecting investments in our long-term growth initiatives
INVESTOR RELATIONS CONTACT: Mark Trinske Vice President of Investor Relations mtrinske@thorindustries.com (574) 970-7912
Exhibit 99.3
SECOND QUARTER OF FISCAL 2021
INVESTOR QUESTIONS & ANSWERS
Published March 9, 2021
Forward-Looking Statements
Reference is made to the forward-looking statements disclosure provided at the end of this document.
Executive Overview
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• |
Net sales for the second quarter were $2.73 billion, an increase of 36.2% as compared to the second quarter of the prior year. Second-quarter results include $1.95 billion in North American RV net sales and $733.5 million in European RV net sales. |
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• |
Consolidated gross profit margin for the second quarter was 15.2%, a 240 basis point improvement over the prior-year period. |
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• |
Net income attributable to THOR for the second quarter increased 362.2% to $132.5 million, or $2.38 per diluted share, as compared to $0.52 per diluted share in the same period of the prior year. |
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• |
Consolidated RV backlog as of January 31, 2021 was $10.81 billion, an increase of nearly 280% over RV backlog as of January 31, 2020. |
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• |
During the quarter, THOR acquired the Tiffin Group, comprised of Tiffin Motorhomes, Vanleigh RV and a number of related supply entities for approximately $300 million. The financial results of the Tiffin Group since the December 18, 2020 acquisition date are included in THOR’s Condensed Consolidated Statements of Income and Comprehensive Income. During this period, the Tiffin Group recorded net sales of $82.4 million and the results of operations were not material. |
Quick Reference to Contents
Current Market Conditions and Outlook Assumptions |
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Q&A |
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Segment Data |
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Summary of Key Quarterly Segment Data - North American Towable RVs |
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Summary of Key Quarterly Segment Data - North American Motorized RVs |
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Summary of Key Quarterly Segment Data - European RVs |
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Forward Looking Statements |
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Current Market Conditions and Outlook Assumptions
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Market conditions in North America. Currently, independent RV dealer inventories are at historically low levels in North America. Demand in the market remains very high, such that our recent deliveries to dealers are being sold at retail very quickly and are not yet being used to restock dealer lots. We expect the restocking cycle may take a number of quarters to complete. In the longer-term, which we define as late calendar 2022 and beyond, we expect to get back to a more normal ordering cycle where dealers order to replenish sold stock. |
RVIA recently issued its updated forecast for calendar year 2021 wholesale unit shipments. RVIA now estimates total North American shipments in calendar year 2021 will likely be approximately 533,400 units, an increase of 24% over calendar year 2020 unit shipments of 430,412. Towable RV shipments are anticipated to reach 479,800 units in calendar year 2021, an increase of approximately 23% over calendar year 2020 shipments. Motorhome shipments are projected to finish at 53,600 units in calendar year 2021, an increase of approximately 31% over calendar year 2020 shipments.
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Market conditions in Europe. Independent RV dealer inventory levels of our European RV products are generally below prior-year levels in the various countries we serve. Within Germany, which accounts for approximately 60% of our European product sales, dealer inventories are significantly below normal stocking levels. |
Total retail registrations in Europe for the fourth calendar quarter of 2020 increased 44% compared to the same time period in 2019. For the full calendar year of 2020, retail registrations increased 11.6% to 234,843 units from 210,505 units in calendar year 2020. Industry wholesale data is not available within the European market, thus retail information remains the best gauge.
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Supply chain constraints. Given the high RV retail demand, historically low dealer inventory levels and a global supply chain ramping up to meet the higher demand, while also continuing to manage the impacts of COVID-19, we, and the industry, have been experiencing various supply chain constraints and disruptions in both North America and Europe. In North America, we have recently experienced constraints and shortages of various RV component parts from a number of suppliers as a result of current market conditions, and the COVID-19 pandemic. Additionally, the recent harsh weather conditions in the southern United States have impacted the availability of certain petroleum-based components. In Europe, we continue to experience supply constraints of certain component parts from our non-chassis raw material vendors. Additionally, primarily due to pandemic-related challenges, we have experienced delays in receipt of chassis from our European chassis suppliers. In the short term, we expect these challenges to persist and, in particular, anticipate continued delays in receipt of chassis in Europe. |
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COVID-19 operational impacts. During the quarter, our operations were impacted by COVID-19 primarily in the form of the related supply chain constraints noted above, which led to certain production interruptions. The extent to which the COVID-19 pandemic may impact our business directly or indirectly in future periods remains uncertain and unpredictable. |
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dealers in North America, continue to invest heavily in their businesses with new or expanded locations, added service facilities and other amenities to serve RV consumers. |
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Positive near-term and long-term RV industry outlook in both North America and Europe. Our confident outlook is supported by favorable demographics, strong RV retail sales, favorable perception of RVing as promoting a safe, socially distanced and healthy lifestyle and adequate availability of RV dealer and consumer credit at historically low rates in both North America and Europe. |
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1. |
What was THOR’s adjusted EBITDA for the second quarter and year-to-date for both fiscal 2021 and 2020? |
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a. |
Although we do not generally disclose non-GAAP numbers, we recognize that many of the users of our financial statements find a measure of EBITDA adjusted for non-cash or non-routine items to be useful. Below are some items within our financial statements that might be helpful in considering this question: |
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Three Months Ended |
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Six Months Ended |
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Income Before Income Taxes (1) |
$ |
164.0 million |
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$ |
310.3 million |
Depreciation & Amortization (2) |
56.7 million |
|
111.0 million |
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Net Interest Expense (1) |
24.0 million |
|
47.9 million |
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Inventory Step-Up Impact on Gross Profit (5) |
4.3 million |
|
4.3 million |
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Stock-Based Compensation Expense (3) |
7.3 million |
|
13.1 million |
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Change in LIFO Reserve (4) |
2.2 million |
|
3.2 million |
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Three Months Ended |
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Six Months Ended |
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Income Before Income Taxes (1) |
$ |
34.9 million |
|
$ |
103.5 million |
Depreciation & Amortization (2) |
48.9 million |
|
99.2 million |
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Impairment Charges (1) |
10.1 million |
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10.1 million |
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Net Interest Expense (1) |
26.3 million |
|
53.3 million |
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Stock-Based Compensation Expense (3) |
5.1 million |
|
10.1 million |
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Change in LIFO Reserve (4) |
0.5 million |
|
0.5 million |
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(1) From the Income Statement |
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(2) From the Business Segments footnote |
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(5) From the Segment Information section of MD&A |
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(3) From the Statement of Cash Flows |
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(4) From the Inventories footnote |
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2. |
Can you comment on THOR’s North American wholesale shipment share in calendar year 2020? How does THOR management think about THOR’s North American wholesale shipment share going forward? |
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a. |
Given that current demand exceeds supply in the market and many state motor vehicle departments are behind in registering new RVs, we believe recent retail share indicators are not as meaningful as usual. Wholesale shipment share (as a percent of total wholesale shipments) is currently a more accurate proxy for market share growth. Our Motorized segment wholesale shipment share has steadily increased since the pandemic commenced, increasing to 45% in the second quarter of fiscal |
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2021 compared to 43% in the first quarter of fiscal 2021. Our Towable segment wholesale shipment share was 42.0% in the second quarter of fiscal 2021, as compared to 43.6% in the first quarter of fiscal 2021. |
(Note: The Tiffin group was acquired by THOR on December 18, 2020; therefore quarterly comparisons for Tiffin wholesale shipment share are excluded from the above analysis, but will be fully included in our future quarterly reporting)
THOR is expanding production capacity to capture future wholesale shipment share gains. Since August, we have retrofitted a number of existing facilities, are adding new production lines to increase capacity within our existing plant footprint, and are evaluating adding a limited number of new plants to increase production. We will continue to bring additional capacity online in our second half of fiscal 2021 and expect to see shipment and market share gains as we further accelerate production throughput. We believe prudent production capacity management is critical in our cyclical industry.
Looking ahead, THOR expects wholesale shipment share growth in fiscal 2021. RVIA’s calendar year 2021 forecast issued March 2, 2021 projects a 24% increase in wholesale shipments to approximately 533,400 units in calendar 2021 compared to 430,412 units in calendar 2020. We agree with their forecast and are fortunate to have the leading portfolio of brands, great strategic relationships with our supplier and dealer base and a record order backlog of approximately $10.8 billion.
Through increased production capacity and throughput, superior product offerings and continued operational excellence, we are cautiously optimistic that, absent a significant economic impact as a result of COVID-19 supply constraints or other events, THOR will meet or exceed RVIA’s forecasted growth and continue to increase its wholesale shipment share.
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3. |
Can you comment on THOR’s European segment? What macro trends are you seeing and what is the business outlook? |
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a. |
Macro Commentary. We are pleased with the performance of our European segment given the dynamic environment they are operating in. Over 90% of our sales are made to dealers within 13 different European countries, so our near term results will depend upon the various economic conditions and local restrictions in place to manage the COVID-19 pandemic within each of these respective countries we sell into. Currently, it is inherently difficult to provide generalized statements about the operating conditions within the entire European region. However, we do note that: |
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i. |
Germany, which represents approximately 60% of our European RV product sales, has been the strongest performing country and has experienced an increase in retail registrations of 98% in the fourth calendar quarter of 2020 and an increase of 33% for the full calendar year 2020 versus 2019. This increase was partly attributable to the German tax incentive program which lowered the VAT from 19% to 16%, and expired on December 31, 2020. Industry wholesale data is not available within the European market, thus retail information remains the best gauge. |
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ii. |
In contrast, in the UK, our third largest market in Europe, dealers and retail foot traffic have been greatly affected by strict restrictions put into place due to the COVID-19 pandemic. As a result, UK fourth calendar quarter retail unit sales increased just 1% year-over-year while full year 2020 registrations were down 19% vs 2019. |
European Consumer Trend Towards Campervans
We are seeing an influx of younger buyers and a mix shift towards products with lower average selling price products within the European market. During the first six months of our fiscal 2021, Campervans, the equivalent of Class B products in North America, have been very popular, particularly in Germany. Within our European segment, Campervans accounted for 31% of unit shipments for the six month period ended January 31, 2021 compared to 23% for the comparable period of fiscal 2020. As a result of this mix shift, our European segment gross margin profile was impacted as Campervans generally carry a higher material percentage due to the chassis content.
Business Outlook
Our European segment's operational focus continues to be on production optimization to meet strong retail demand. On the whole, dealer inventory and restocking levels in Europe are below prior year, and our wholesale shipments are being retail sold quickly. Our European business expects to continue experiencing positive year-over-year growth. We anticipate supply chain constraints will lessen in the back half of calendar 2021.
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4. |
Can you comment on your recent acquisition of Tiffin Motorhomes? |
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a. |
In December 2020, THOR acquired luxury motorized recreational vehicle manufacturer Tiffin Motorhomes, Inc., including fifth wheel towable recreational vehicle manufacturer Vanleigh RV and certain other associated operating and supply companies, which primarily supply component parts and services to Tiffin Motorhomes, Inc. and Vanleigh RV. The purchase price of approximately $300 million was funded through existing cash on-hand as well as $165 million in borrowings from THOR’s existing asset-based credit facility ("ABL"). |
With this acquisition THOR gained:
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People – Tiffin has a great management team and an excellent workforce. The business environment is very welcoming with access to a talented labor force. |
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Products – Tiffin products are well-known for their design and excellent quality. |
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Place – Tiffin is based in Alabama and Mississippi, which expands THOR’s manufacturing footprint into new geographic areas. |
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Potential – Tiffin has excellent potential for product line extensions, new products, and facility expansions. |
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5. |
What was the impact of the Tiffin acquisition for the second quarter of fiscal 2021? |
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a. |
For the second quarter of fiscal 2021, Tiffin Group accounted for approximately $82.4 million of net sales while the impact on net income before tax was not material due in part to the step-up in assigned value of recently acquired Tiffin Motorhomes inventory that was included in cost of products sold during the current-year period. As a reminder, we acquired Tiffin Group on December 18, 2020, so |
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second quarter results reflect just over one month of net sales. Of the $82.4 million of net sales related to Tiffin, $74.6 million was included in North American motorized net sales and $7.8 million was included in North American towable net sales. |
For additional details regarding the acquisition, please see Footnote 2 in our Quarterly Report on Form 10-Q for the quarter ended January 31, 2021.
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6. |
How do used RV sales impact RV wholesale sales? Do you think the increase in new units being sold will lead to an overabundance of used units in the market space in the near future? |
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a. |
We have consistently viewed a healthy used RV market as an essential ingredient for creating a healthy new RV market. Typically, much of a dealer’s used RV inventory is a result of a trade-in for a new unit. In addition, used unit sales are often made to new entrants to the RV lifestyle, and, if they enjoy the lifestyle, it typically leads to future sales of new units. |
All of our independent dealers manage their product portfolios based on current market demand and their own internal metrics. Right now, used inventory is very limited. Looking ahead, we believe any change in used inventory levels in the market space would not materially impact our sales, as we are now operating with an all-time record backlog and dealers are in need of inventory.
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7. |
THOR’s consolidated gross profit margin increased 240 basis points in the second quarter on a year-over-year basis. What drove this improvement? How should we think about gross margins going forward? |
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a. |
The improvement in consolidated gross profit margin was primarily driven by our North American segments. Total North American gross profit margin increased 310 basis points, from 12.4% in the second quarter of fiscal 2020 to 15.5% in the second quarter of fiscal 2021. North American Towable RV and North American Motorized RV gross profit margins were positively impacted by 1) a reduction in sales discounts, 2) favorable warranty experience trends and 3) lower overhead costs as a percentage of sales as a result of higher production levels and overhead spending controls. These positive impacts were partially offset by higher labor costs due to the current competitive RV labor market conditions in northern Indiana. |
European recreational vehicle gross profit margin increased from 12.5% in the second quarter of fiscal 2020 to 12.9% in the second quarter of fiscal 2021, driven primarily by slight reductions in labor and warranty costs as a percentage of sales.
Regarding future gross margins, we continue to operate in a highly complex and rapidly evolving environment due to COVID-19, supply chain constraints and a high-volume production environment given the strong demand backdrop. In the near term we expect to see a continuation of 1) material and labor cost pressures, 2) lower year-over-year discounting and promotions, 3) favorable year-over-year operating leverage given the high production levels, while also managing through the impacts of COVID and ongoing supply chain constraints.
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8. |
What were some of the key factors that affected SG&A expenses during the quarter? |
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a. |
Selling, general and administrative expenses are primarily variable in nature and fluctuate with the level of sales and income before income taxes. In dollar terms, the impact of higher net sales and |
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income before income taxes across our business segments in both North America and Europe caused related commissions, incentive and other compensation to increase during the second quarter of fiscal 2021. These increases were partially offset by reduced sales-related travel, advertising and promotional costs in the current year period, largely a result of the cancellation of the major RV shows in North America and in Europe along with travel restrictions due to the COVID-19 pandemic. |
As a percentage of net sales for the second quarter, THOR’s SG&A expenses were down compared to the prior year, at 7.6% compared to 8.1% last year, due to the increased net sales volumes in the current year period.
7
Summary of Key Quarterly Segment Data – North American Towable RVs
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NET SALES: |
Three Months Ended |
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Three Months Ended |
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% Change |
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North American Towables |
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Travel Trailers and Other |
$ |
831,359 |
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$ |
583,121 |
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42.6 |
% |
Fifth Wheels |
541,822 |
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400,786 |
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35.2 |
% |
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Total North American Towables |
$ |
1,373,181 |
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$ |
983,907 |
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39.6 |
% |
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# OF UNITS: |
Three Months Ended |
|
Three Months Ended |
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% Change |
|||||
North American Towables |
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|
|
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|
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Travel Trailers and Other |
37,346 |
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|
27,126 |
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37.7 |
% |
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Fifth Wheels |
11,057 |
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|
8,440 |
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31.0 |
% |
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Total North American Towables |
48,403 |
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|
35,566 |
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36.1 |
% |
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ORDER BACKLOG |
As of |
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As of |
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% Change |
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North American Towables |
$ |
5,253,564 |
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|
$ |
948,055 |
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454.1 |
% |
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TOWABLE RV MARKET SHARE SUMMARY (1) |
Calendar Year |
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2020 |
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2019 |
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U.S. Market |
41.0 |
% |
|
44.3 |
% |
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Canadian Market |
47.1 |
% |
|
50.0 |
% |
|
|
|||
Combined North American Market |
41.5 |
% |
|
44.9 |
% |
|
|
(1) Source: Statistical Surveys, Inc. Calendar Years 2020 and 2019. Given the proximity of the December 18, 2020 acquisition date of the Tiffin Group to the end of the 2020 calendar year data presented below, the results of the Tiffin Group are excluded from the Company's totals.
Note: Data reported by Stat Surveys is based on official state and provincial records. This information is subject to adjustment, is continuously updated, and is often impacted by delays in reporting by various states or provinces. The COVID-19 pandemic has resulted in further delays in the submission of information reported by the various states or provinces beginning with calendar 2020 results, and may also be impacting the completeness of such information.
8
Summary of Key Quarterly Segment Data – North American Motorized RVs
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NET SALES: |
Three Months Ended |
|
Three Months Ended |
|
% Change |
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North American Motorized |
|
|
|
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Class A |
$ |
222,128 |
|
|
$ |
125,474 |
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|
77.0 |
% |
Class C |
294,300 |
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|
186,761 |
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|
57.6 |
% |
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Class B |
60,567 |
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31,445 |
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92.6 |
% |
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Total North American Motorized |
$ |
576,995 |
|
|
$ |
343,680 |
|
|
67.9 |
% |
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
# OF UNITS: |
Three Months Ended |
|
Three Months Ended |
|
% Change |
|||||
North American Motorized |
|
|
|
|
|
|||||
Class A |
1,500 |
|
|
1,066 |
|
|
40.7 |
% |
||
Class C |
3,481 |
|
|
2,483 |
|
|
40.2 |
% |
||
Class B |
606 |
|
|
254 |
|
|
138.6 |
% |
||
Total North American Motorized |
5,587 |
|
|
3,803 |
|
|
46.9 |
% |
||
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
ORDER BACKLOG |
As of |
|
As of |
|
% Change |
|||||
North American Motorized |
$ |
2,916,433 |
|
|
$ |
784,355 |
|
|
271.8 |
% |
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
MOTORIZED RV MARKET SHARE SUMMARY (1) |
Calendar Year |
|
|
|||||||
|
2020 |
|
2019 |
|
|
|||||
U.S. Market |
38.4 |
% |
|
36.9 |
% |
|
|
|||
Canadian Market |
42.6 |
% |
|
38.5 |
% |
|
|
|||
Combined North American Market |
38.6 |
% |
|
37.0 |
% |
|
|
(1) Source: Statistical Surveys, Inc. Calendar Years 2020 and 2019. Given the proximity of the December 18, 2020 acquisition date of the Tiffin Group to the end of the 2020 calendar year data presented below, the results of the Tiffin Group are excluded from the Company's totals.
Note: Data reported by Stat Surveys is based on official state and provincial records. This information is subject to adjustment, is continuously updated and is often impacted by delays in reporting by various states or provinces. The COVID-19 pandemic has resulted in further delays in the submission of information reported by the various states or provinces beginning with calendar 2020 results, and may also be impacting the completeness of such information.
9
Summary of Key Quarterly Segment Data – European RVs
|
|
|
|
|
|
|||||
NET SALES: |
Three Months Ended |
|
Three Months Ended |
|
% Change |
|||||
European |
|
|
|
|
|
|||||
Motorcaravan |
$ |
419,137 |
|
|
$ |
382,422 |
|
|
9.6 |
% |
Campervan |
149,112 |
|
|
97,923 |
|
|
52.3 |
% |
||
Caravan |
71,654 |
|
|
69,909 |
|
|
2.5 |
% |
||
Other |
93,560 |
|
|
86,861 |
|
|
7.7 |
% |
||
Total European |
$ |
733,463 |
|
|
$ |
637,115 |
|
|
15.1 |
% |
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
# OF UNITS: |
Three Months Ended |
|
Three Months Ended |
|
% Change |
|||||
European |
|
|
|
|
|
|||||
Motorcaravan |
7,026 |
|
|
7,372 |
|
|
(4.7) |
% |
||
Campervan |
4,121 |
|
|
3,304 |
|
|
24.7 |
% |
||
Caravan |
3,434 |
|
|
3,620 |
|
|
(5.1) |
% |
||
Total European |
14,581 |
|
|
14,296 |
|
|
2.0 |
% |
||
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
ORDER BACKLOG |
As of |
|
As of |
|
% Change |
|||||
European |
$ |
2,644,181 |
|
|
$ |
1,141,981 |
|
|
131.5 |
% |
|
|
|
|
|
|
|||||
|
|
|
|
|
|
|||||
EUROPEAN RV MARKET SHARE SUMMARY (1) |
Calendar Year |
|
|
|||||||
|
2020 |
|
2019 (3) |
|
|
|||||
Motorcaravan and Campervan (2) |
25.7 |
% |
|
25.7 |
% |
|
|
|||
Caravan |
20.0 |
% |
|
20.6 |
% |
|
|
(1) Source: European Caravan Federation ("ECF"), Calendar Year 2020 vs. Calendar Year 2019. Data from the ECF is subject to adjustment, continuously updated and is often impacted by delays in reporting by various countries (some countries, including the United Kingdom, do not report OEM-specific data and are thus excluded from the market share calculation).
(2) The ECF reports motorcaravans and campervans together.
(3) For comparison purposes, the totals reflected above include the pre-acquisition results of Erwin Hymer Group for January 2019.
Note: Industry wholesale shipment data for the European RV market is not available.
10
This release includes certain statements that are “forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made based on management’s current expectations and beliefs regarding future and anticipated developments and their effects upon THOR, and inherently involve uncertainties and risks. These forward-looking statements are not a guarantee of future performance. We cannot assure you that actual results will not differ materially from our expectations. Factors which could cause materially different results include, among others: the extent and impact from the continuation of the COVID-19 pandemic, along with the responses to contain the spread of the virus by various governmental entities or other actors, which may have negative effects on retail customer demand, our independent dealers, our supply chain, our labor force, our production or other aspects of our business and which may have a negative impact on our consolidated results of operations, financial position, cash flows and liquidity; the ability to ramp production up or down quickly in response to rapid changes in demand while also managing costs and market share; the effect of raw material and commodity price fluctuations, and/or raw material, commodity or chassis supply constraints; the impact of tariffs on material or other input costs; the level and magnitude of warranty claims incurred; legislative, regulatory and tax law and/or policy developments including their potential impact on our dealers and their retail customers or on our suppliers; the costs of compliance with governmental regulation; legal and compliance issues including those that may arise in conjunction with recently completed transactions; lower consumer confidence and the level of discretionary consumer spending; interest rate fluctuations and their potential impact on the general economy and, specifically, on our dealers and consumers; the impact of exchange rate fluctuations; restrictive lending practices which could negatively impact our independent dealers and/or retail consumers; management changes; the success of new and existing products and services; the ability to efficiently utilize existing production facilities; changes in consumer preferences; the risks associated with acquisitions, including: the pace and successful closing of an acquisition, the integration and financial impact thereof, the level of achievement of anticipated operating synergies from acquisitions, the potential for unknown or understated liabilities related to acquisitions, the potential loss of existing customers of acquisitions and our ability to retain key management personnel of acquired companies; a shortage of necessary personnel for production and increasing labor costs to attract production personnel in times of high demand; the loss or reduction of sales to key dealers; disruption of the delivery of units to dealers; increasing costs for freight and transportation; asset impairment charges; cost structure changes; competition; the impact of potential losses under repurchase or financed receivable agreements; the potential impact of the strength of the U.S. dollar on international demand for products priced in U.S. dollars; general economic, market and political conditions in the various countries in which our products are produced and/or sold; the impact of changing emissions and other regulatory standards in the various jurisdictions in which our products are produced, used and/or sold; changes to our investment and capital allocation strategies or other facets of our strategic plan; and changes in market liquidity conditions, credit ratings and other factors that may impact our access to future funding and the cost of debt.
These and other risks and uncertainties are discussed more fully in our Quarterly Report on Form 10-Q for the quarter ended January 31, 2021 and in Item 1A of our Annual Report on Form 10-K for the year ended July 31, 2020.
We disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained in this release or to reflect any change in our expectations after the date hereof or any change in events, conditions or circumstances on which any statement is based, except as required by law.
11
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