Segment Reporting

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

The Company has two reportable segments; the recreational vehicle products segment (the "RV Segment") and the manufactured housing products segment (the "MH Segment"). Intersegment sales are insignificant.

The RV Segment, which accounted for 90 percent, 88 percent, and 87 percent of consolidated net sales for the years ended December 31, 2014, 2013 and 2012 respectively, manufactures a variety of products used in the production of RVs, including:

● Steel chassis for towable RVs	● Chassis components
● Axles and suspension solutions for towable RVs	● Furniture and mattresses
● Slide-out mechanisms and solutions	● Entry, luggage, patio and ramp doors
● Thermoformed bath, kitchen and other products	● Electric and manual entry steps
● Windows	● Awnings and slide toppers
● Manual, electric and hydraulic stabilizer and     leveling systems	● Other accessories and electronic components

The Company also supplies certain of these products to the RV aftermarket, and to adjacent industries, including buses and trailers used to haul boats, livestock, equipment and other cargo. Approximately 79 percent of the Company’s RV Segment net sales in 2014 were of products to original equipment manufacturers ("OEMs") of travel trailer and fifth-wheel RVs.

The MH Segment, which accounted for 10 percent, 12 percent and 13 percent of consolidated net sales for the years ended December 31, 2014, 2013 and 2012, respectively, manufactures a variety of products used in the production of manufactured homes, including:

●Vinyl and aluminum windows	●Steel chassis
●Thermoformed bath and kitchen products	●Steel chassis parts
●Steel and fiberglass entry doors	●Axles
●Aluminum and vinyl patio doors

The Company also supplies certain of these products to the manufactured housing aftermarket, and to adjacent industries, including modular housing and mobile office units. Certain of the Company’s MH Segment customers manufacture both manufactured homes and modular homes, and certain of the products manufactured by the Company are suitable for both types of homes. As a result, the Company is not always able to determine in which type of home its products are installed.

Decisions concerning the allocation of the Company's resources are made by the Company's key executives, with oversight by the Board of Directors. This group evaluates the performance of each segment based upon segment operating profit or loss, generally defined as income or loss before interest and income taxes. Decisions concerning the allocation of resources are also based on each segment’s utilization of assets. Management of debt is a corporate function. The accounting policies of the RV and MH Segments are the same as those described in Note 1 of the Notes to Consolidated Financial Statements.

Effective with the second quarter of 2013, in connection with the management succession and relocation of the corporate office from New York to Indiana, corporate expenses, accretion related to contingent consideration and other non-segment items, which were previously reported on separate lines, have been included as part of segment operating profit. Corporate expenses are allocated between the segments based upon net sales. Accretion related to contingent consideration and other non-segment items are included in the segment to which they relate. The segment disclosures from prior years have been reclassified to conform to the current year presentation.

Information relating to segments follows for the years ended December 31:

	Segments						Corporate
(In thousands)	RV		MH		Total		and Other			Total
2014
Net sales to external customers (a)	$	1,074,448	$	116,334	$	1,190,782	$	—		$	1,190,782
Operating profit (loss) (b)	$	86,571	$	10,870	$	97,441	$	(1,954	)	$	95,487
Total assets (c)	$	451,264	$	29,482	$	480,746	$	63,095		$	543,841
Expenditures for long - lived assets (d)	$	145,406	$	2,039	$	147,445	$	—		$	147,445
Depreciation and amortization	$	29,933	$	2,568	$	32,501	$	95		$	32,596

	Segments						Corporate
(In thousands)	RV		MH		Total		and Other			Total
2013
Net sales to external customers (a)	$	893,694	$	121,882	$	1,015,576	$	—		$	1,015,576
Operating profit (loss) (b)	$	68,248	$	11,926	$	80,174	$	(1,876	)	$	78,298
Total assets (c)	$	306,139	$	32,948	$	339,087	$	114,097		$	453,184
Expenditures for long - lived assets (d)	$	34,989	$	2,682	$	37,671	$	—		$	37,671
Depreciation and amortization	$	24,615	$	2,806	$	27,421	$	79		$	27,500
2012
Net sales to external customers (a)	$	780,925	$	120,198	$	901,123	$	—		$	901,123
Operating profit (loss) (b)	$	47,172	$	12,416	$	59,588	$	(1,456	)	$	58,132
Total assets (c)	$	281,728	$	35,668	$	317,396	$	56,472		$	373,868
Expenditures for long - lived assets (d)	$	30,893	$	2,739	$	33,632	$	—		$	33,632
Depreciation and amortization	$	22,750	$	2,822	$	25,572	$	93		$	25,665

(a) Thor Industries, Inc., a customer of the RV Segment, accounted for 33 percent, 34 percent and 37 percent of the Company’s consolidated net sales for the years ended December 31, 2014, 2013 and 2012, respectively. Berkshire Hathaway Inc. (through its subsidiaries Forest River, Inc. and Clayton Homes, Inc.), a customer of both segments, accounted for 28 percent, 28 percent and 27 percent of the Company’s consolidated net sales for the years ended December 31, 2014, 2013 and 2012, respectively. No other customer accounted for more than 10 percent of consolidated net sales in the years ended December 31, 2014, 2013 and 2012.

(b) Certain general and administrative expenses are allocated between the segments based upon net sales or operating profit, depending upon the nature of the expense.

(c) Segment assets include accounts receivable, inventories, fixed assets, goodwill and other intangible assets. Corporate and other assets include cash and cash equivalents, prepaid expenses and other current assets, deferred taxes, and other assets.

(d) Expenditures for long-lived assets include capital expenditures, as well as fixed assets, goodwill and other intangible assets purchased as part of the acquisition of businesses. The Company purchased $105.0 million, $4.8 million and $1.5 million of long-lived assets, as part of the acquisitions of businesses in the years ended December 31, 2014, 2013 and 2012, respectively.

Net sales by product were as follows for the years ended December 31:

(In thousands)	2014		2013		2012
RV Segment:
Chassis, chassis parts and slide-out mechanisms	$	564,543	$	493,244	$	443,850
Windows and doors	204,054		181,934		173,436
Furniture and mattresses	133,371		100,196		78,082
Axles and suspension solutions	92,261		69,818		57,275
Other	80,219		48,502		28,282
Total RV Segment net sales	$	1,074,448	$	893,694	$	780,925
MH Segment:
Windows and doors	$	66,140	$	67,029	$	63,655
Chassis and chassis parts	33,842		38,359		41,874
Other	16,352		16,494		14,669
Total MH Segment net sales	$	116,334	$	121,882	$	120,198
Total net sales	$	1,190,782	$	1,015,576	$	901,123

The composition of net sales was as follows for the years ended December 31:

(In thousands)	2014		2013		2012
Net sales:
RV Segment:
RV OEMs:
Travel trailers and fifth-wheels	$	844,096	$	727,783	$	653,478
Motorhomes	67,774		47,937		34,612
RV aftermarket	49,570		25,334		19,119
Adjacent industries	113,008		92,640		73,716
Total RV Segment net sales	$	1,074,448	$	893,694	$	780,925
MH Segment:
Manufactured housing OEMs	$	77,421	$	80,245	$	80,392
Manufactured housing aftermarket	14,186		13,719		13,110
Adjacent industries	24,727		27,918		26,696
Total MH Segment net sales	$	116,334	$	121,882	$	120,198
Total net sales	$	1,190,782	$	1,015,576	$	901,123

Potential Future Changes to Reporting Segments

Over the past several years, largely due to the growth the Company has experienced in its RV Segment, the MH Segment is now a smaller part of the Company. Net sales to manufactured housing OEMs are 7 percent of consolidated net sales for the year ending December 31, 2014. In addition, the Company has recently increased its focus on the significant opportunities in the RV aftermarket, which is currently included in the RV Segment. While there were no changes to the Company’s segment reporting through December 31, 2014, the Company will continue to evaluate the information provided to its Chief Operating Decision Maker ("CODM"), and assess the impact of any changes to its reporting structures that will reflect how its CODM will assess the performance of the Company's operating segments and make decisions about resource allocations which impact the operating segments the Company reports.