10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 2, 2021

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-04714

Skyline Champion Corporation

(Exact name of registrant as specified in its charter)

Indiana	35-1038277
(State of Incorporation)	(I.R.S. Employer Identification No.)
755 West Big Beaver Road, Suite 1000
Troy, Michigan	48084
(Address of Principal Executive Offices)	(Zip Code)

(248) 614-8211

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	SKY	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filers,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:):

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐
Smaller reporting company	☐	Emerging growth company	☐

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 provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Number of shares of common stock outstanding as of October 21, 2021: 56,799,419

SKYLINE CHAMPION CORPORATION

FORM 10-Q

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Consolidated Balance Sheets as of October 2, 2021 (unaudited) and April 3, 2021	1
Condensed Consolidated Income Statements (unaudited) for the three and six months ended October 2, 2021 and September 26, 2020	2
Condensed Consolidated Statements of Comprehensive Income (unaudited) for the three and six months ended October 2, 2021 and September 26, 2020	3
Condensed Consolidated Statements of Cash Flows (unaudited) for the six months ended October 2, 2021 and September 26, 2020	4
Condensed Consolidated Statements of Stockholders’ Equity (unaudited) for the three and six months ended October 2, 2021 and September 26, 2020	5
Notes to Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	15
Item 3. Quantitative and Qualitative Disclosures About Market Risk	29
Item 4. Controls and Procedures	29
PART II – OTHER INFORMATION
Item 1. Legal Proceedings	30
Item 6. Exhibits	31
SIGNATURES	32

i

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Skyline Champion Corporation

Condensed Consolidated Balance Sheets

(Dollars and shares in thousands, except per share amounts)

	October 2, 2021			April 3, 2021
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	310,258		$	262,581
Trade accounts receivable, net		72,886			57,481
Inventories, net		179,976			166,113
Other current assets		20,315			13,592
Total current assets		583,435			499,767
Long-term assets:
Property, plant, and equipment, net		122,905			115,140
Goodwill		191,970			191,803
Amortizable intangible assets, net		55,073			58,835
Deferred tax assets		13,832			19,914
Other noncurrent assets		43,115			32,443
Total assets	$	1,010,330		$	917,902
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Floor plan payable	$	30,840		$	25,733
Accounts payable		57,694			57,214
Other current liabilities		200,747			180,695
Total current liabilities		289,281			263,642
Long-term liabilities:
Long-term debt		12,430			39,330
Deferred tax liabilities		4,620			4,280
Other		41,021			42,039
Total long-term liabilities		58,071			85,649
Stockholders' Equity:
Common stock, $0.0277 par value, 115,000 shares authorized, 56,796 and 56,640 shares issued as of October 2, 2021 and April 3, 2021, respectively		1,572			1,569
Additional paid-in capital		496,059			491,668
Retained earnings		173,513			82,898
Accumulated other comprehensive loss		(8,166	)		(7,524	)
Total stockholders’ equity		662,978			568,611
Total liabilities and stockholders’ equity	$	1,010,330		$	917,902

See accompanying Notes to Condensed Consolidated Financial Statements.

1

Skyline Champion Corporation

Condensed Consolidated Income Statements

(Unaudited, dollars in thousands, except per share amounts)

	Three months ended					Six months ended
	October 2, 2021		September 26, 2020			October 2, 2021			September 26, 2020
Net sales	$	524,225	$	322,366		$	1,034,422		$	595,651
Cost of sales		394,898		259,573			793,565			478,855
Gross profit		129,327		62,793			240,857			116,796
Selling, general, and administrative expenses		61,340		41,373			115,363			82,180
Operating income		67,987		21,420			125,494			34,616
Interest expense, net		845		864			1,494			1,806
Other expense (income)		11		(2,599	)		(43	)		(6,813	)
Income before income taxes		67,131		23,155			124,043			39,623
Income tax expense		16,408		5,644			30,419			10,209
Net income	$	50,723	$	17,511		$	93,624		$	29,414
Net income per share:
Basic	$	0.89	$	0.31		$	1.65		$	0.52
Diluted	$	0.89	$	0.31		$	1.64		$	0.52

See accompanying Notes to Condensed Consolidated Financial Statements.

2

Skyline Champion Corporation

Condensed Consolidated Statements of Comprehensive Income

(Unaudited, dollars in thousands)

	Three months ended					Six months ended
	October 2, 2021			September 26, 2020		October 2, 2021			September 26, 2020
Net income	$	50,723		$	17,511	$	93,624		$	29,414
Other comprehensive income (loss):
Foreign currency translation adjustments		(1,520	)		861		(642	)		1,956
Total comprehensive income	$	49,203		$	18,372	$	92,982		$	31,370

See accompanying Notes to Condensed Consolidated Financial Statements.

3

Skyline Champion Corporation

Condensed Consolidated Statements of Cash Flows

(Unaudited, dollars in thousands)

	Six months ended
	October 2, 2021			September 26, 2020
Cash flows from operating activities
Net income	$	93,624		$	29,414
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		6,521			5,969
Amortization of intangible assets		3,762			2,721
Amortization of deferred financing fees		509			253
Equity-based compensation		4,213			3,624
Deferred taxes		6,421			2,655
Loss on disposal of property, plant, and equipment		686			15
Foreign currency transaction loss (gain)		35			(219	)
Change in assets and liabilities:
Accounts receivable		(15,351	)		(984	)
Inventories		(14,138	)		(990	)
Prepaids and other assets		(17,934	)		(2,063	)
Accounts payable		407			5,406
Accrued expenses and other liabilities		20,132			18,041
Net cash provided by operating activities		88,887			63,842
Cash flows from investing activities
Additions to property, plant, and equipment		(15,105	)		(2,552	)
Cash paid for acquisition		(207	)		—
Proceeds from maturity of Company owned life insurance policy		—			1,186
Proceeds from disposal of property, plant, and equipment		66			32
Net cash used in investing activities		(15,246	)		(1,334	)
Cash flows from financing activities
Changes in floor plan financing, net		5,107			(7,316	)
Payments on deferred financing fees		(1,130	)		—
Payments on revolving debt facility		(26,900	)		—
Stock option exercises		377			67
Tax payments for equity-based compensation		(3,007	)		(1,687	)
Net cash used in financing activities		(25,553	)		(8,936	)
Effect of exchange rate changes on cash and cash equivalents		(411	)		1,259
Net increase in cash and cash equivalents		47,677			54,831
Cash and cash equivalents at beginning of period		262,581			209,455
Cash and cash equivalents at end of period	$	310,258		$	264,286

See accompanying Notes to Condensed Consolidated Financial Statements.

4

Skyline Champion Corporation

Condensed Consolidated Statements of Stockholders’ Equity

(Unaudited, dollars and shares in thousands)

	Three months ended October 2, 2021
	Common Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at July 3, 2021		56,699	$	1,571	$	493,191	$	124,467		$	(6,646	)	$	612,583
Net income		—		—		—		50,723			—			50,723
Equity-based compensation		—		—		2,772		—			—			2,772
Net common stock issued under equity-based compensation plans		97		1		96		(1,677	)		—			(1,580	)
Foreign currency translation adjustments		—		—		—		—			(1,520	)		(1,520	)
Balance at October 2, 2021		56,796	$	1,572	$	496,059	$	173,513		$	(8,166	)	$	662,978
	Six months ended October 2, 2021
	Common Stock
	Shares		Amount		Additional Paid in Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at April 3, 2021		56,640	$	1,569	$	491,668	$	82,898		$	(7,524	)	$	568,611
Net income		—		—		—		93,624			—			93,624
Equity-based compensation		—		—		4,213		—			—			4,213
Net common stock issued under equity-based compensation plans		156		3		178		(3,009	)		—			(2,828	)
Foreign currency translation adjustments		—		—		—		—			(642	)		(642	)
Balance at October 2, 2021		56,796	$	1,572	$	496,059	$	173,513		$	(8,166	)	$	662,978

	Three months ended September 26, 2020
	Common Stock
	Shares			Amount			Additional Paid in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at June 27, 2020		56,665		$	1,570		$	487,781		$	11,610		$	(11,664	)	$	489,297
Net income		—			—			—			17,511			—			17,511
Equity-based compensation		—			—			1,398			—			—			1,398
Net common stock issued under equity-based compensation plans		(27	)		(1	)		(1,622	)		—			—			(1,623	)
Foreign currency translation adjustments		—			—			—			—			861			861
Balance at September 26, 2020		56,638		$	1,569		$	487,557		$	29,121		$	(10,803	)	$	507,444
	Six months ended September 26, 2020
	Common Stock
	Shares			Amount			Additional Paid in Capital			Retained Earnings			Accumulated Other Comprehensive Loss			Total
Balance at March 28, 2020		56,665		$	1,570		$	485,552		$	(48	)	$	(12,759	)	$	474,315
Net income		—			—			—			29,414			—			29,414
Equity-based compensation		—			—			3,624			—			—			3,624
Cumulative adjustment for adoption of ASU 2016-13		—			—			—			(245	)		—			(245	)
Net common stock issued under equity-based compensation plans		(27	)		(1	)		(1,619	)		—			—			(1,620	)
Foreign currency translation adjustments		—			—			—			—			1,956			1,956
Balance at September 26, 2020		56,638		$	1,569		$	487,557		$	29,121		$	(10,803	)	$	507,444

Components of accumulated other comprehensive income (loss) consisted solely of foreign currency translation adjustments.

See accompanying Notes to Condensed Consolidated Financial Statements.

5

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements

1. Basis of Presentation and Business

Nature of Operations: Skyline Champion Corporation (the “Company”) is a leading producer of factory-built housing in the United States (“U.S.”) and Canada. The Company’s operations consist of manufacturing, retail, and transportation activities. The Company operates 35 manufacturing facilities throughout the U.S. and five manufacturing facilities in western Canada. These facilities primarily construct factory-built, timber-framed manufactured, and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 18 sales centers that sell manufactured houses to consumers primarily in the Southern U.S. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles and other products throughout the U.S. and Canada.

COVID-19 Government Financial Assistance: The outbreak of a novel strain of coronavirus ("COVID-19") was declared a global pandemic by the World Health Organization in March 2020. Various government programs were announced to provide financial relief for affected businesses, including the Employee Retention Credit under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") and state level programs in the United States and the Canada Emergency Wage Subsidy ("CEWS") under the COVID-19 Economic Response Plan in Canada. The Company recognized $0.6 million for wage subsidies under the CARES Act and other state level programs in the United States during the first quarter of fiscal 2021. The Company recognized $2.6 million and $6.2 million of payroll subsidies under CEWS during the three and six months ended September 26, 2020, respectively. The Company’s policy is to account for these subsidies as Other Income in the period in which the related costs are incurred and the Company is reasonably assured to receive payment. In addition, the CARES Act allows for deferring payment of certain payroll taxes. Through October 2, 2021, the Company has deferred $11.8 million of payroll taxes that will be paid beginning in December 2021.

Basis of Presentation: The accompanying unaudited condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Quarterly Reports on Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations.

The condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries after elimination of intercompany balances and transactions. In the opinion of management, these statements include all normal recurring adjustments necessary to fairly state the Company’s consolidated results of operations, cash flows, and financial position. The Company has evaluated subsequent events after the balance sheet date through the date of the filing of this report with the SEC. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on May 26, 2021 (the “Fiscal 2021 Annual Report”).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes thereto. Actual results could differ from those estimates. The condensed consolidated income statements, condensed consolidated statements of comprehensive income, and condensed consolidated statements of cash flows for the interim periods are not necessarily indicative of the results of operations or cash flows for the full year.

The Company’s allowance for credit losses on financial assets measured at amortized cost reflects management’s estimate of credit losses over the remaining expected life of such assets, measured primarily using historical experience, as well as current economic conditions and forecasts that affect the collectability of the reported amount. Expected credit losses for newly recognized financial assets, as well as changes to expected credit losses during the period, are recognized in earnings. Accounts receivable are reflected net of reserves of $0.5 million and $0.4 million at October 2, 2021 and April 3, 2021, respectively. At both October 2, 2021 and April 3, 2021, other notes receivable are reflected net of reserves of $0.4 million.

The Company’s fiscal year is a 52- or 53-week period that ends on the Saturday nearest to March 31. The Company’s current fiscal year, “fiscal 2022,” will end on April 2, 2022 and will include 52 weeks. References to “fiscal 2021” refer to the Company’s fiscal year ended April 3, 2021. The three and six months ended October 2, 2021 and September 26, 2020 each included 13 and 26 weeks, respectively.

There were no accounting standards recently issued that are expected to have a material impact on the Company’s financial position or results of operations. 

6

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

2. Business Acquisition

ScotBilt Acquisition

On February 28, 2021, the Company acquired 100% of the membership interests of ScotBilt Homes, LLC and related companies (“ScotBilt”), a builder of manufactured homes with annual revenues of approximately $79.0 million, for a purchase price of $53.0 million. Under the terms of the purchase agreement, the preliminary purchase price was adjusted for cash held by ScotBilt at the closing date and working capital adjustments resulting in an initial total purchase consideration of $54.5 million. In the first quarter of fiscal 2022, the Company adjusted the preliminary purchase price allocation by $0.2 million as a result of the final working capital settlement. The Company accounted for the acquisition as a business combination under the acquisition method of accounting provided by FASB ASC 805, Business Combinations (“ASC 805”). As such, the purchase price was allocated to the net assets acquired, inclusive of intangible assets, with the excess fair value recorded to goodwill. The purchase price allocation for this acquisition is preliminary and could change.

The preliminary allocation of the purchase price was as follows:
 

(Dollars in thousands)
Cash	$	1,521
Trade accounts receivable		2,256
Inventory		6,752
Property, plant, and equipment		10,466
Other assets		1,164
Accounts payable and accrued liabilities		(7,432	)
Intangibles		21,100
Goodwill		18,449
Total purchase price allocation	$	54,276

Goodwill is primarily attributable to expected synergies from the combination of the companies, including, but not limited to, expected cost synergies through procurement activities and operational improvements through sharing of best practices. Goodwill, which is deductible for income tax purposes, was allocated to the U.S. Factory-built Housing reporting unit.

Cash, trade accounts receivable, inventory, other assets, accounts payable, and accrued liabilities were generally stated at historical carrying values given the short-term nature of these assets and liabilities. Intangible assets include $13.0 million in customer relationships and $8.1 million associated with the ScotBilt trade name and were based on an independent appraisal. The fair value of the customer relationships was determined using the multi-period excess earnings method and the fair value of the trade name was determined using the relief-from-royalty method. The Company estimates that each intangible asset has a weighted average useful life of ten years from the acquisition date. Fair value estimates of property, plant, and equipment were based on independent appraisals, giving consideration to the highest and best use of the assets. Key assumptions used in the appraisals were based on a combination of market, cost, and sales comparison approaches, as appropriate. Level 3 fair value estimates of $10.5 million related to property, plant, and equipment and $21.1 million related to intangible assets were recorded in the accompanying consolidated balance sheet as of April 3, 2021.

The acquisition of ScotBilt was a taxable business combination. Therefore, the Company’s tax basis in the assets acquired and the liabilities assumed approximate the respective fair values at the acquisition date.

3. Inventories, net

The components of inventory, net of reserves for obsolete inventory, were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Raw materials	$	104,179	$	91,916
Work in process		24,036		21,642
Finished goods and other		51,761		52,555
Total inventories, net	$	179,976	$	166,113

At October 2, 2021 and April 3, 2021, reserves for obsolete inventory were $4.5 million and $4.6 million, respectively.

7

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

4. Property, Plant, and Equipment

Property, plant, and equipment are stated at cost. Depreciation is calculated primarily on a straight-line basis, generally over the following estimated useful lives: land improvements – 3 to 10 years; buildings and improvements – 8 to 25 years; and vehicles and machinery and equipment – 3 to 8 years. Depreciation expense for the three months ended October 2, 2021 and September 26, 2020 was $3.3 million and $3.1 million, respectively. Depreciation expense for the six months ended October 2, 2021 and September 26, 2020 was $6.5 million and $6.0 million, respectively.

The components of property, plant, and equipment were as follows:

(Dollars in thousands)	October 2, 2021			April 3, 2021
Land and improvements	$	38,966		$	36,470
Buildings and improvements		96,324			97,005
Machinery and equipment		61,384			57,790
Construction in progress		10,591			1,889
Property, plant, and equipment, at cost		207,265			193,154
Less: accumulated depreciation		(84,360	)		(78,014	)
Property, plant, and equipment, net	$	122,905		$	115,140

5. Goodwill, Intangible Assets, and Cloud Computing Arrangements

Goodwill

Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. At October 2, 2021 and April 3, 2021, the Company had goodwill of $192.0 million and $191.8 million, respectively.

Intangible Assets

The components of amortizable intangible assets were as follows:

(Dollars in thousands)	October 2, 2021									April 3, 2021
	Customer Relationships			Trade Names			Total			Customer Relationships			Trade Names			Total
Gross carrying amount	$	61,923		$	21,393		$	83,316		$	61,963		$	21,409		$	83,372
Accumulated amortization		(20,934	)		(7,309	)		(28,243	)		(18,158	)		(6,379	)	$	(24,537	)
Amortizable intangibles, net	$	40,989		$	14,084		$	55,073		$	43,805		$	15,030		$	58,835

During the three months ended October 2, 2021 and September 26, 2020, amortization of intangible assets was $1.9 million and $1.3 million, respectively. During the six months ended October 2, 2021 and September 26, 2020, amortization of intangible assets was $3.8 million and $2.7 million, respectively.

Cloud Computing Arrangements

The Company capitalizes costs associated with the development of cloud computing arrangements in a manner consistent with internally developed technology. At October 2, 2021 and April 3, 2021, the Company had capitalized cloud computing costs of $10.6 million and $0.3 million within other noncurrent assets, respectively. There was no amortization of capitalized cloud computing costs during the three and six months ended October 2, 2021 and September 26, 2020, respectively, as the related cloud computing technology has not yet been placed in service.

8

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

6. Other Current Liabilities

The components of other current liabilities were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Customer deposits	$	59,807	$	58,888
Accrued volume rebates		23,048		18,207
Accrued warranty obligations		25,419		24,033
Accrued compensation and payroll taxes		45,484		42,560
Accrued insurance		15,716		12,421
Other		31,273		24,586
Total other current liabilities	$	200,747	$	180,695

7. Accrued Warranty Obligations

Changes in the accrued warranty obligations were as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Balance at beginning of period	$	31,079		$	24,695		$	30,469		$	24,969
Warranty expense		10,880			8,394			21,184			14,753
Cash warranty payments		(10,104	)		(8,629	)		(19,798	)		(15,262	)
Balance at end of period		31,855			24,460			31,855			24,460
Less: noncurrent portion in other long-term liabilities		(6,436	)		(5,790	)		(6,436	)		(5,790	)
Total current portion	$	25,419		$	18,670		$	25,419		$	18,670

8. Debt and Floor Plan Payable

Long-term debt consisted of the following:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Revolving credit facility maturing in 2026	$	—	$	26,900
Obligations under industrial revenue bonds due 2029		12,430		12,430
Total debt		12,430		39,330
Less: current portion		—		—
Total long-term debt	$	12,430	$	39,330

On July 7, 2021, the Company entered into an Amended and Restated Credit Agreement with a syndicate of banks that provides for a revolving credit facility of up to $200.0 million, including a $45.0 million letter of credit sub-facility (“Amended Credit Agreement”). The Amended Credit Agreement replaced the Company’s previously existing $100.0 million revolving credit facility. Outstanding borrowings of $26.9 million on the Company’s previous revolving credit facility were repaid in July 2021. The Amended Credit Agreement allows the Company to draw down, repay and re-draw loans on the available funds during the term, subject to certain terms and conditions, matures in July 2026 and has no scheduled amortization. The Company capitalized $1.1 million of deferred financing fees associated with the Amended Credit Agreement, which is included in other noncurrent assets on the consolidated balance sheet. The Company wrote off $0.3 million of deferred financing fees associated with the previously existing credit facility, which is included in interest expense, net for the three and six months ended October 2, 2021.

The interest rate on borrowings under the Amended Credit Agreement adjusts based on the consolidated total net leverage of the Company from a high of LIBOR plus 1.875% and ABR plus 0.875%, at the election of the Company, when the consolidated total net leverage ratio is equal to or greater than 2.25:1.00, to a low of LIBOR plus 1.125% and ABR plus 0.125% when the consolidated total net leverage is below 0.50:1.00. In addition, the Company is obligated to pay an unused line fee ranging between 0.15% and 0.3% (depending on the consolidated total net leverage ratio) in respect of unused commitments under the Amended Credit Agreement. At October 2, 2021 the interest rate under the Amended Credit Agreement was 1.2%. At October 2, 2021, letters of credit issued under the Amended Credit Agreement totaled $30.4 million and total available borrowings were $169.6 million.

9

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

Obligations under industrial revenue bonds are supported by letters of credit and bear interest based on a municipal bond index rate. The weighted-average interest rate at October 2, 2021, including related costs and fees, was 1.74%. The industrial revenue bonds require lump-sum payments of principal upon maturity in 2029.

The Amended Credit Agreement contains covenants that restrict the amount of additional debt, liens and certain payments, including equity buybacks, investments, dispositions, mergers and consolidations, among other restrictions as defined. The Company was in compliance with all covenants of the Amended Credit Agreement as of October 2, 2021.

Floor Plan Payable

The Company’s retail operations utilize floor plan financing to fund the purchase of manufactured homes for display or resale. At October 2, 2021 and April 3, 2021, the Company had outstanding borrowings on floor plan financing agreements of $30.8 million and $25.7 million, respectively. Total credit line capacity provided under the agreements was $57.0 million as of October 2, 2021. Borrowings are secured by the homes and are required to be repaid when the Company sells the home to a customer.

10

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

9. Revenue Recognition

The following tables disaggregate the Company’s revenue by sales category for the three and six months ended October 2, 2021 and September 26, 2020:

	Three months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	469,127	$	38,501	$	—	$	507,628
Commercial		2,572		—		—		2,572
Transportation		—		—		14,025		14,025
Total	$	471,699	$	38,501	$	14,025	$	524,225
	Six months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	925,018	$	76,332	$	—	$	1,001,350
Commercial		4,001		—		—		4,001
Transportation		—		—		29,071		29,071
Total	$	929,019	$	76,332	$	29,071	$	1,034,422
	Three months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	275,969	$	24,558	$	—	$	300,527
Commercial		7,391		—		—		7,391
Transportation		—		—		14,448		14,448
Total	$	283,360	$	24,558	$	14,448	$	322,366
	Six months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	524,828	$	39,753	$	—	$	564,581
Commercial		7,391		—		—		7,391
Transportation		—		—		23,679		23,679
Total	$	532,219	$	39,753	$	23,679	$	595,651

11

Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

10. Income Taxes

For the three months ended October 2, 2021 and September 26, 2020, the Company recorded $16.4 million and $5.6 million of income tax expense and had an effective tax rate during each period of 24.4%. For the six months ended October 2, 2021 and September 26, 2020, the Company recorded $30.4 million and $10.2 million of income tax expense and had an effective tax rate of 24.5% and 25.8%, respectively.

The Company’s effective tax rate for the three months and six months ended October 2, 2021 differs from the federal statutory rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, results in foreign jurisdictions, and tax benefits from vested equity compensation. The Company’s effective tax rate for the three months and six months ended September 26, 2020 differs from the federal statutory rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, and results in foreign jurisdictions.

At October 2, 2021, the Company had no unrecognized tax benefits. The Company does not anticipate any material changes to uncertain tax benefits in the next twelve months. The Company records interest and penalties related to unrecognized tax benefits as a component of income tax expense.

11. Earnings Per Share

Basic net income per share (“EPS”) attributable to the Company was computed by dividing net income attributable to the Company by the average number of common shares outstanding during the period. Certain of the Company’s time-based restricted share awards were considered participating securities prior to the completion of the vesting period. The vesting for these time-based shares occurred in the second quarter of fiscal 2021. Diluted earnings per common share is computed based on the more dilutive of: (i) the two class method, assuming the participating securities are not exercised or converted; or (ii) the summation of average common shares outstanding and additional common shares that would have been outstanding if the dilutive potential common shares had been issued. During the three and six months ended September 26, 2020, the two-class method was more dilutive.

The following table sets forth the computation of basic and diluted earnings per common share:

	Three months ended					Six months ended
(Dollars and shares in thousands, except per share data)	October 2, 2021		September 26, 2020				October 2, 2021		September 26, 2020
Numerator:
Net income	$	50,723	$	17,511			$	93,624	$	29,414
Undistributed earnings allocated to participating securities		—		(19	)			—		(53	)
Net income attributable to the Company's common shareholders	$	50,723	$	17,492			$	93,624	$	29,361
Denominator:
Basic weighted-average shares outstanding		56,808		56,654				56,757		56,593
Dilutive securities		400		255				455		238
Diluted weighted-average shares outstanding		57,208		56,909				57,212		56,831
Basic net income per share	$	0.89	$	0.31			$	1.65	$	0.52
Diluted net income per share	$	0.89	$	0.31			$	1.64	$	0.52

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Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

12. Segment Information

Financial results for the Company's reportable segments have been prepared using a management approach, which is consistent with the basis and manner in which financial information is evaluated by the Company's chief operating decision maker in allocating resources and in assessing performance. The Company’s chief operating decision maker, the Chief Executive Officer, evaluates the performance of the Company’s segments primarily based on net sales, earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and operating assets.

The Company operates in two reportable segments: (i) U.S. Factory-built Housing, which includes manufacturing and retail housing operations and (ii) Canadian Factory-built Housing. Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments and intersegment eliminations. Segments are generally determined by geography. Segment data includes intersegment revenues and corporate office costs that are directly and exclusively incurred for each segment. Total assets for Corporate/Other primarily includes cash and certain deferred tax items not specifically allocated to another segment.

Selected financial information by reportable segment was as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Net sales:
U.S. Factory-built Housing	$	471,699		$	283,360		$	929,019		$	532,219
Canadian Factory-built Housing		38,501			24,558			76,332			39,753
Corporate/Other		14,025			14,448			29,071			23,679
Consolidated net sales	$	524,225		$	322,366		$	1,034,422		$	595,651
Operating income:
U.S. Factory-built Housing EBITDA	$	78,075		$	28,697		$	141,092		$	53,090
Canadian Factory-built Housing EBITDA		6,390			5,951			12,056			10,857
Corporate/Other EBITDA		(11,351	)		(6,221	)		(17,328	)		(13,828	)
Other income		11			(2,599	)		(43	)		(6,813	)
Depreciation		(3,264	)		(3,048	)		(6,521	)		(5,969	)
Amortization		(1,874	)		(1,360	)		(3,762	)		(2,721	)
Consolidated operating income	$	67,987		$	21,420		$	125,494		$	34,616
Depreciation:
U.S. Factory-built Housing	$	2,619		$	2,391		$	5,229		$	4,789
Canadian Factory-built Housing		273			248			558			363
Corporate/Other		372			409			734			817
Consolidated depreciation	$	3,264		$	3,048		$	6,521		$	5,969
Amortization of U.S. Factory-built Housing intangible assets:	$	1,874		$	1,360		$	3,762		$	2,721
Capital expenditures:
U.S. Factory-built Housing	$	5,269		$	1,054		$	12,527		$	1,939
Canadian Factory-built Housing		236			85			341			242
Corporate/Other		379			102			2,237			371
Consolidated capital expenditures	$	5,884		$	1,241		$	15,105		$	2,552
(Dollars in thousands)							October 2, 2021			April 3, 2021
Total Assets:
U.S. Factory-built Housing (1)							$	605,669		$	578,897
Canadian Factory-built Housing (1)								93,773			87,224
Corporate/Other (1)								310,888			251,781
Consolidated total assets							$	1,010,330		$	917,902

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Skyline Champion Corporation

Notes to Condensed Consolidated Financial Statements - Continued

(1)Deferred tax assets for the Canadian operations are reflected in the Canadian Factory-built Housing segment. U.S. deferred tax assets are presented in Corporate/Other because an allocation between segments is not practicable. 

13. Commitments, Contingencies and Legal Proceedings

Repurchase Contingencies and Guarantees

The Company is contingently liable under terms of repurchase agreements with lending institutions that provide wholesale floor plan financing to retailers. These arrangements, which are customary in the manufactured housing industry, provide for the repurchase of products sold to retailers in the event of default by the retailer on its agreement to pay the financial institution. The risk of loss from these agreements is spread over numerous retailers. The repurchase price is generally determined by the original sales price of the product less contractually defined curtailment payments. Excluding the resale value of the homes, the contingent repurchase obligation as of October 2, 2021 was estimated to be $243.4 million. The Company accounts for the guarantees under its repurchase agreements with the retailers’ financing institutions by estimating and deferring a portion of the related product sale that represents the estimated fair value of the repurchase obligation. In addition, the Company has estimated the expected contingent net loss the Company will incur upon resale of any repurchases. These estimates are based on recent historical experience supplemented by management’s assessment of current economic and other conditions affecting retailers for which the Company has a contingent repurchase obligation. Based on these repurchase agreements and historical loss experience, as well as current economic conditions and forecasts that affect the potential loss exposure, a loss reserve of $1.5 million and $1.4 million was recorded as of October 2, 2021 and April 3, 2021, respectively. Losses incurred on homes repurchased were not significant during the three or six months ended October 2, 2021 or September 26, 2020.

At October 2, 2021, the Company was contingently obligated for $30.4 million under letters of credit, primarily consisting of $12.6 million to support long-term debt, $17.5 million to support the casualty insurance program, and $0.3 million to support bonding agreements. The letters of credit are issued from a sub-facility of the Amended Credit Agreement. The Company was also contingently obligated for $35.1 million under surety bonds, generally to support performance on long-term construction contracts and license and service bonding requirements.

In the normal course of business, the Company’s former subsidiaries that operated in the United Kingdom historically provided certain guarantees to two customers. Those guarantees provide contractual liability for proven construction defects up to 12 years from the date of delivery of certain products. The guarantees remain a contingent liability of the Company which declines over time through October 2027. As of the date of this report, the Company expects few, if any, claims to be reported under the terms of the guarantees.

Legal Proceedings

The Company has agreed to indemnify counterparties in the ordinary course of its business in agreements to acquire and sell business assets and in financing arrangements. The Company is subject to various legal proceedings and claims that arise in the ordinary course of its business. As of the date of this filing, the Company believes the ultimate liability with respect to these contingent obligations will not have, either individually or in the aggregate, a material adverse effect on the Company’s financial condition, results of operations, or cash flows.

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Item 2. MANAGEMENT’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following should be read in conjunction with Skyline Champion Corporation’s condensed consolidated financial statements and the related notes that appear in Item 1 of this Report.

Overview

Skyline Champion Corporation (the “Company”) is a leading producer of factory-built housing in the U.S. and Canada. The Company serves as a complete solutions provider across complementary and vertically integrated businesses including manufactured offsite construction, company-owned retail locations, and transportation logistics services. The Company is the largest independent publicly traded factory-built solutions provider in North America (based on revenue) and markets its homes under several nationally recognized brand names including Skyline Homes, Champion Home Builders, Genesis Homes, Athens Park Models, Dutch Housing, Excel Homes, Homes of Merit, New Era, Redman Homes, ScotBilt Homes, Shore Park, Silvercrest, and Titan Homes in the U.S., and Moduline and SRI Homes in western Canada. The Company operates 35 manufacturing facilities throughout the U.S. and five manufacturing facilities in western Canada that primarily construct factory-built, timber-framed, manufactured and modular houses that are sold mainly to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 18 sales centers that sell manufactured homes to consumers primarily in the southern U.S. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles, and other products throughout the U.S. and Canada.

Industry and Company Outlook

Since July 2020, U.S. and Canadian housing industry demand has been robust. The limited availability of existing homes for sale and the broader need for newly built affordable, single-family housing has continued to drive demand for new homes in these markets. In recent years, manufactured home construction experienced revenue growth due to a number of favorable demographic trends and demand drivers in the United States, including underlying growth trends in key homebuyer groups, such as the population over 55 years of age, the population of first-time home buyers, and the population of households earning less than $60,000 per year. We have also seen a number of market trends pointing to increased sales of accessory dwelling units and urban-to-rural migration as customers accommodate working-from-home patterns, as well as people seeking rent-to-own single-family options.

The robust demand environment has resulted in backlog of $1,369 million as of October 2, 2021 compared to $390.1 million as of September 26, 2020. Generally higher backlog at our manufacturing facilities creates an opportunity to increase production efficiencies. Although the higher demand brings opportunities, it also has resulted in significant increases in certain material input costs, most significantly forest products for much of fiscal 2022. In addition, we are also experiencing supply disruption, higher freight costs and fluctuating prices for many of our other material inputs. Finding and retaining qualified labor continues to be a challenge for our plants which requires us to review our compensation programs and adjust accordingly. We manage our business to anticipate or quickly react to these supply challenges and cost increases and generally are able to pass along increased costs to our customers. Historically, order cancellation rates have been very low, but the longer lead-time caused by larger backlogs and changing prices could result in cancellations in future periods.

For the six months ended October 2, 2021, approximately 77% of the Company’s U.S. manufacturing sales were generated from the manufacture of homes that comply with the U.S. Department of Housing and Urban Development ("HUD") code construction standard in the U.S. Industry shipments of HUD-code homes are reported on a one-month lag. According to data reported by the Manufactured Housing Institute ("MHI"), HUD-code industry home shipments were 43,949 and 36,312 units during the five months ended August 31, 2021 and 2020, respectively. Based on industry data, the Company’s U.S. wholesale market share of HUD code homes sold was 19.5% and 15.6%, for the five months ended August 31, 2021 and 2020, respectively. Annual shipments have generally increased each year since calendar year 2009 when only 50,000 HUD-coded manufactured homes were shipped, the lowest level since the industry began recording statistics in 1959. While shipments of HUD-coded manufactured homes have improved modestly in recent years, manufactured housing’s most recent annual shipment levels still operate at lower levels than the long-term historical average of over 200,000 units.

Acquisitions and Expansions

Over the last several years, demand for the Company’s products, primarily affordable housing in the U.S., has continued to improve. As a result, the Company has focused on operational improvements to make existing manufacturing facilities more profitable as well as executing measured expansion of its manufacturing and retail footprints.

The Company has increased capacity through strategic acquisitions and expansions of its manufacturing operations. The Company is focused on growing in strong housing markets across the U.S.

On June 21, 2021, the Company acquired two idle facilities in Navasota, Texas in order to strengthen its production capabilities in the Texas market. The Company intends to initiate production in one of these facilities by the end of fiscal 2022. On February 28, 2021, the Company acquired ScotBilt. In calendar 2020, ScotBilt shipped over 1,600 homes from its two manufacturing facilities in Georgia providing affordable housing throughout Alabama, Florida, Georgia and the Carolinas. ScotBilt has approximately 400 employees in its two

15

manufacturing facilities. The Company believes ScotBilt is an excellent fit because of the compatible company cultures and because of ScotBilt’s strong presence in the attractive Mid-South region, which helps to balance national distribution and complements the Company’s existing manufacturing footprint. The operations of ScotBilt are included in the financial results of the Company since the date of the acquisition. On January 14, 2021, the Company acquired two idled facilities in Pembroke, North Carolina, which provides an opportunity to further expand its manufacturing footprint in the South and Southeast markets. The Company is currently assessing prospects for initiating production in one or both of these facilities.

The Company's acquisitions and investments are part of a strategy to grow and diversify revenue with a focus on increasing the Company’s HUD and modular homebuilding presence in the U.S. as well as improving the results of operations. These acquisitions and investments are included in the Company's consolidated results for periods subsequent to their respective acquisition dates.

COVID-19 Pandemic

The outbreak of a novel strain of coronavirus ("COVID-19") was declared a global pandemic by the World Health Organization in March 2020. There remains continued uncertainty regarding the extent and duration of the impact that the COVID-19 pandemic will have on the economy, the housing market, and the Company, as well as the Company’s employees, customers, and suppliers.

The Company has prioritized the safety and well-being of its employees and customers and has implemented standards to operate in accordance with social-distancing protocols and public health authority guidelines. Beginning in March 2020, the Company took actions to temporarily idle certain facilities in response to government shutdown orders or reduced demand. By late April 2020, most of the temporarily idled manufacturing facilities had reopened, but at reduced production levels due to employee absenteeism, difficulty hiring new team members, and social distancing protocols. During fiscal 2021, the Company experienced intermittent closures due to COVID-19 outbreaks at the facilities or surrounding communities causing higher than normal absenteeism. In the second half of fiscal 2021, the Company was able to increase daily production rates over the levels achieved in the prior fiscal year period as direct labor staffing levels increased and production efficiencies improved. As of October 2, 2021, availability of labor and certain materials remain subject to disruption and uncertainty. Prices for key raw materials have experienced increased volatility and, overall, manufacturing costs have trended higher than prior periods.

As part of the initial response to the pandemic, the Company offered extended benefits to employees, including increased sick pay and waived premium payments on healthcare benefits for furloughed employees during the first quarter of fiscal 2021. The Company’s U.S. operations incurred $1.9 million of expense related to the extended benefits. Various government programs have been announced to provide financial relief for affected businesses, including the Employee Retention Credit under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") in the United States and the Canada Emergency Wage Subsidy ("CEWS") under the COVID-19 Economic Response Plan in Canada. CEWS provided a cash subsidy of up to 75% of eligible employees’ remuneration, subject to certain criteria. The Company recognized $2.6 million and $6.2 million, respectively, for payroll subsidies under CEWS during the three and six months ended September 26, 2020. The Company also recognized $0.6 million for payroll subsidies under the CARES Act during the first quarter of fiscal 2021. In addition, the CARES Act allowed for deferring payment of certain payroll taxes. Through October 2, 2021, the Company has deferred $11.8 million of payroll taxes that will be paid beginning in December 2021.

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UNAUDITED INCOME STATEMENTS FOR THE SECOND QUARTER OF FISCAL 2022 VS. 2021

	Three months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020
Results of Operations Data:
Net sales	$	524,225		$	322,366
Cost of sales		394,898			259,573
Gross profit		129,327			62,793
Selling, general, and administrative expenses		61,340			41,373
Operating income		67,987			21,420
Interest expense, net		845			864
Other income (expense)		11			(2,599	)
Income before income taxes		67,131			23,155
Income tax expense		16,408			5,644
Net income	$	50,723		$	17,511
Reconciliation of Adjusted EBITDA:
Net income	$	50,723		$	17,511
Income tax expense		16,408			5,644
Interest expense, net		845			864
Depreciation and amortization		5,138			4,408
Equity-based compensation (for awards granted prior to December 31, 2018)		—			388
Other		—			122
Adjusted EBITDA	$	73,114		$	28,937
As a percent of net sales:
Gross profit		24.7	%		19.5	%
Selling, general, and administrative expenses		11.7	%		12.8	%
Operating income		13.0	%		6.6	%
Net income		9.7	%		5.4	%
Adjusted EBITDA		13.9	%		9.0	%

NET SALES

The following table summarizes net sales for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021		September 26, 2020		$ Change			% Change
Net sales	$	524,225	$	322,366	$	201,859			62.6	%
U.S. manufacturing and retail net sales	$	471,699	$	283,360	$	188,339			66.5	%
U.S. homes sold		5,902		4,689		1,213			25.9	%
U.S. manufacturing and retail average home selling price	$	79.9	$	60.4	$	19.5			32.3	%
Canadian manufacturing net sales	$	38,501	$	24,558	$	13,943			56.8	%
Canadian homes sold		358		302		56			18.5	%
Canadian manufacturing average home selling price	$	107.5	$	81.3	$	26.2			32.2	%
Corporate/Other net sales	$	14,025	$	14,448	$	(423	)		(2.9	%)
U.S. manufacturing facilities in operation at end of period		35		33
U.S. retail sales centers in operation at end of period		18		18
Canadian manufacturing facilities in operation at end of period		5		5

Net sales for the three months ended October 2, 2021 were $524.2 million, an increase of $201.9 million, or 62.6%, over the three months ended September 26, 2020. The following is a summary of the change by operating segment.

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U.S. Factory-built Housing:

Net sales for the Company’s U.S. manufacturing and retail operations increased by $188.3 million, or 66.5%, for the three months ended October 2, 2021 compared to the three months ended September 26, 2020. The change was primarily due to an increase in the number of homes sold during the period of 25.9%, an increase in the average home selling price of 32.3%, and the impact of the acquisition of ScotBilt. Demand for our products has increased significantly in recent periods and we have been able to increase production in response to that demand. The average selling price increased during the period due to pricing actions enacted in response to rising material, freight, and labor costs. Generally, we are able to pass the increase in input costs along to our customers.

Canadian Factory-built Housing:

The Canadian Factory-built Housing segment net sales increased by $13.9 million, or 56.8% for the three months ended October 2, 2021 compared to the same period in the prior fiscal year, primarily due to an 18.5% increase in the number of homes sold and a 32.2% increase in average home selling price. The increase in volume was due to an increase in demand and production rates. The increase in average selling price was due to pricing actions enacted in response to rising material and labor costs. On a constant currency basis, net sales for the Canadian segment were unfavorably impacted by approximately $0.6 million due to fluctuations in the translation of the Canadian dollar to the U.S. dollar during the three months ended October 2, 2021 as compared to the same period of the prior fiscal year.

Corporate/Other:

Net sales for Corporate/Other includes the Company’s transportation business and the elimination of intersegment sales. For the three months ended October 2, 2021, net sales decreased $0.4 million, or 2.9%, primarily attributable to lower revenue from the shipment of recreational vehicles.

GROSS PROFIT

The following table summarizes gross profit for the three months ended October 2, 2021 and September 26, 2020:
 

	Three months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Gross profit:
U.S. Factory-built Housing	$	116,604		$	54,546		$	62,058		113.8	%
Canadian Factory-built Housing		8,868			4,787			4,081		85.3	%
Corporate/Other		3,855			3,460			395		11.4	%
Total gross profit	$	129,327		$	62,793		$	66,534		106.0	%
Gross profit as a percent of net sales		24.7	%		19.5	%

Gross profit as a percent of sales during the three months ended October 2, 2021 was 24.7% compared to 19.5% during the three months ended September 26, 2020. The following is a summary of the change by operating segment.

U.S. Factory-built Housing:

Gross profit for the U.S. Factory-built Housing segment increased by $62.1 million, or 113.8%, during the three months ended October 2, 2021 compared to the same period in the prior fiscal year. Gross profit was 24.7% as a percent of segment net sales for the three months ended October 2, 2021, compared to 19.2% in the same period of the prior fiscal year. The increase in gross profit is due to the increase in homes sold and operational efficiencies and increased leverage of manufacturing fixed costs resulting from higher production volumes.

Canadian Factory-built Housing:

Gross profit for the Canadian Factory-built Housing segment increased by $4.1 million, or 85.3%, during the three months ended October 2, 2021, compared to the same period in the prior fiscal year, primarily due to increased sales volume. Gross profit as a percent of net sales was 23.0% for the three months ended October 2, 2021, compared to 19.5% in the same period of the prior fiscal year. The improvement is due to direct labor and manufacturing efficiencies from the increase in home sales, partially offset by higher material costs.

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Corporate/Other:

Gross profit for the Corporate/Other segment increased $0.4 million, or 11.4%, during the three months ended October 2, 2021, compared to the same period of the prior fiscal year, as a result of changes in revenue mix.

SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES

Selling, general, and administrative expenses include foreign currency transaction gains and losses, equity compensation, and intangible amortization expense. The following table summarizes selling, general, and administrative expenses for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Selling, general, and administrative expenses:
U.S. Factory-built Housing	$	43,014		$	29,601		$	13,413		45.3	%
Canadian Factory-built Housing		2,751			1,683			1,068		63.5	%
Corporate/Other		15,575			10,089			5,486		54.4	%
Total selling, general, and administrative expenses	$	61,340		$	41,373		$	19,967		48.3	%
Selling, general, and administrative expense as a percent of net sales		11.7	%		12.8	%

Selling, general, and administrative expenses were $61.3 million for the three months ended October 2, 2021, an increase of $20.0 million, or 48.3%, compared to the same period in the prior fiscal year. The following is a summary of the change by operating segment.

U.S. Factory-built Housing:

Selling, general, and administrative expenses for the U.S. Factory-built Housing segment increased $13.4 million, or 45.3%, during the three months ended October 2, 2021, as compared to the same period in the prior fiscal year. Selling, general, and administrative expenses as a percent of segment net sales decreased to 9.1% for the three months ended October 2, 2021, compared to 10.4% during the comparable period of the prior fiscal year, primarily due to increased leverage of fixed costs resulting from the increase in sales. The increase in expenses resulted from the following factors: (i) higher sales commissions and incentive compensation, which is generally based on sales volume or a measure of profitability; (ii) higher wage expense from headcount increases due to the growth in housing demand; and (iii) the impact of the acquisition of the ScotBilt operations.

Canadian Factory-built Housing:

Selling, general, and administrative expenses for the Canadian Factory-built Housing segment increased $1.1 million, or 63.5%, for the three months ended October 2, 2021 when compared to the same period of the prior fiscal year. Selling, general, and administrative expenses as a percent of segment net sales increased to 7.1% for the three months ended October 2, 2021, compared to 6.9% during the comparable period of the prior fiscal year. The increase in expenses resulted from an increase in commissions and incentive compensation as well as wage expense from headcount increases due to the growth in housing demand.

Corporate/Other:

Selling, general, and administrative expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. Selling, general, and administrative expenses for Corporate/Other increased $5.5 million, or 54.4%, during the three months ended October 2, 2021, compared to the same period of the prior fiscal year, due to an increase in employee compensation, primarily equity and incentive compensation as well as $2.1 million of costs related to investments made to enhance our customer buying experience and supporting systems.

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INTEREST EXPENSE, NET

The following table summarizes the components of interest expense, net for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change			% Change
Interest expense	$	993		$	974		$	19			2.0	%
Less: Interest income		(148	)		(110	)		(38	)		34.5	%
Interest expense, net	$	845		$	864		$	(19	)		(2.2	%)
Average outstanding floor plan payable	$	29,300		$	27,309
Average outstanding long-term debt	$	12,430		$	77,330

Interest expense, net was $0.8 million for the three months ended October 2, 2021, remaining consistent with the same period of the prior fiscal year. The Company wrote off $0.3 million of deferred financing fees during the second quarter ended October 2, 2021, which offset the reduction in interest expense from lower average outstanding borrowing balance on the Company's revolving credit facility during the second quarter ended October 2, 2021 versus the same quarter in fiscal 2021.

OTHER EXPENSE (INCOME)

The following table summarizes other income for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021		September 26, 2020			$ Change		% Change
Other expense (income)	$	11	$	(2,599	)	$	2,610		(100.4	%)

Other income decreased $2.6 million, or 100.4%, during the three months ended October 2, 2021, as compared to the same period of the prior fiscal year. The decrease is due to a reduction in the wage subsidies provided by a Canadian government sponsored financial assistance program initially enacted in response to the pandemic.

INCOME TAX EXPENSE

The following table summarizes income tax expense for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Income tax expense	$	16,408		$	5,644		$	10,764		190.7	%
Effective tax rate		24.4	%		24.4	%

Income tax expense for the three months ended October 2, 2021 was $16.4 million, representing an effective tax rate of 24.4%, compared to income tax expense of $5.6 million, representing an effective tax rate of 24.4% for the three months ended September 26, 2020.

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The Company’s effective tax rate for the three months ended October 2, 2021 differs from the federal statutory income tax rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, results in foreign jurisdictions, and tax benefits from vested equity compensation. The Company’s effective tax rate for the three months ended September 26, 2020 differs from the federal statutory income tax rate of 21.0% due primarily to the effect of non-deductible expenses, state and local income taxes, tax credits, and results in foreign jurisdictions.


ADJUSTED EBITDA

The following table reconciles net income, the most directly comparable U.S. GAAP measure, to Adjusted EBITDA, a non-GAAP financial measure, for the three months ended October 2, 2021 and September 26, 2020:

	Three months ended
(Dollars in thousands)	October 2, 2021		September 26, 2020		$ Change			% Change
Net income	$	50,723	$	17,511	$	33,212		*
Income tax expense		16,408		5,644		10,764		*
Interest expense, net		845		864		(19	)		(2.2	%)
Depreciation and amortization		5,138		4,408		730			16.6	%
Equity-based compensation (for awards granted prior to December 31, 2018)		—		388		(388	)	*
Other		—		122		(122	)	*
Adjusted EBITDA	$	73,114	$	28,937	$	44,177		*

* indicates that the calculated percentage is not meaningful

Adjusted EBITDA for the three months ended October 2, 2021 was $73.1 million, an increase of $44.2 million from the same period of the prior fiscal year. The increase is primarily a result of higher operating income due to increases in sales volume and gross margin, partially offset by higher SG&A expenses.

UNAUDITED INCOME STATEMENTS FOR THE FIRST HALF OF FISCAL 2022 VS. 2021

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020
Results of Operations Data:
Net sales	$	1,034,422		$	595,651
Cost of sales		793,565			478,855
Gross profit		240,857			116,796
Selling, general, and administrative expenses		115,363			82,180
Operating income		125,494			34,616
Interest expense, net		1,494			1,806
Other income		(43	)		(6,813	)
Income before income taxes		124,043			39,623
Income tax expense		30,419			10,209
Net income	$	93,624		$	29,414
Reconciliation of Adjusted EBITDA:
Net income	$	93,624		$	29,414
Income tax expense		30,419			10,209
Interest expense, net		1,494			1,806
Depreciation and amortization		10,283			8,690
Equity-based compensation (for awards granted prior to December 31, 2018)		—			1,358
Adjusted EBITDA	$	135,820		$	51,477
As a percent of net sales:
Gross profit		23.3	%		19.6	%
Selling, general, and administrative expenses		11.2	%		13.8	%
Operating income		12.1	%		5.8	%
Net income		9.1	%		4.9	%
Adjusted EBITDA		13.1	%		8.6	%

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NET SALES

The following table summarizes net sales for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021		September 26, 2020		$ Change		% Change
Net sales	$	1,034,422	$	595,651	$	438,771		73.7	%
U.S. manufacturing and retail net sales	$	929,019	$	532,219	$	396,800		74.6	%
U.S. homes sold		12,274		8,717		3,557		40.8	%
U.S. manufacturing and retail average home selling price	$	75.7	$	61.1	$	14.6		23.9	%
Canadian manufacturing net sales	$	76,332	$	39,753	$	36,579		92.0	%
Canadian homes sold		743		494		249		50.4	%
Canadian manufacturing average home selling price	$	102.7	$	80.5	$	22.2		27.6	%
Corporate/Other net sales	$	29,071	$	23,679	$	5,392		22.8	%
U.S. manufacturing facilities in operation at end of period		35		33
U.S. retail sales centers in operation at end of period		18		18
Canadian manufacturing facilities in operation at end of period		5		5

Net sales for the six months ended October 2, 2021 were $1,034.4 million, an increase of $438.8 million, or 73.7%, over the six months ended September 26, 2020. The following is a summary of the change by operating segment.

U.S. Factory-built Housing:

Net sales for the Company’s U.S. manufacturing and retail operations increased by $396.8 million, or 74.6%, for the six months ended October 2, 2021 compared to the six months ended September 26, 2020. The increase was primarily due to an increase in the number of homes sold during the period of 3,557, an increase in the average selling price of 23.9%, and the impact of the acquisition of ScotBilt. The increase in the number of homes sold was a result of increased production levels at many of the Company’s manufacturing locations in reaction to strong demand. The average selling price increased due to pricing actions enacted in response to rising material and labor costs. Generally, we are able to pass the increase in input costs along to our customers. Net sales in the six months ended September 26, 2020 were more negatively impacted by COVID-19 related plant shutdowns and higher than normal absenteeism.

Canadian Factory-built Housing:

The Canadian Factory-built Housing segment net sales increased by $36.6 million, or 92.0%, for the six months ended October 2, 2021 compared to the same period in the prior fiscal year, primarily due to an increase in homes sold of 249, coupled with a 27.6% increase in average home selling price. The increase in volume was due to an increase in demand and production rates. The increase in average selling price was due to pricing actions enacted in response to rising material and labor costs. On a constant currency basis, net sales for the Canadian segment were favorably impacted by approximately $6.8 million due to fluctuations in the translation of the Canadian dollar to the U.S. dollar during the first six months of fiscal 2022 as compared to the same period of the prior fiscal year. Net sales in the six months ended September 26, 2020 were more negatively impacted by COVID-19 related plant shutdowns and higher than normal absenteeism.

Corporate/Other:

Net sales for Corporate/Other includes the Company’s transportation business and the elimination of intersegment sales. For the six months ended October 2, 2021, net sales increased $5.4 million, or 22.8%, primarily attributable to an increase in shipments of manufactured homes and recreational vehicles.

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GROSS PROFIT

The following table summarizes gross profit for the six months ended October 2, 2021 and September 26, 2020:
 

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Gross profit:
U.S. Factory-built Housing	$	215,815		$	102,956		$	112,859		109.6	%
Canadian Factory-built Housing		17,193			7,569			9,624		127.2	%
Corporate/Other		7,849			6,271			1,578		25.2	%
Total gross profit	$	240,857		$	116,796		$	124,061		106.2	%
Gross profit as a percent of net sales		23.3	%		19.6	%

Gross profit as a percent of sales during the six months ended October 2, 2021 was 23.3% compared to 19.6% during the six months ended September 26, 2020. The following is a summary of the change by operating segment.

U.S. Factory-built Housing:

Gross profit for the U.S. Factory-built Housing segment increased by $112.9 million, or 109.6%, during the six months ended October 2, 2021 compared to the same period in the prior fiscal year. Gross profit was 23.2% as a percent of segment net sales for the six months ended October 2, 2021 compared to 19.3% in the same period of the prior fiscal year. The increase in gross profit is due to operational efficiencies and increased leverage of manufacturing fixed costs resulting from higher production volumes and a reduction of COVID-19 related sick-pay and health benefits provided in the prior fiscal year, all partially offset by higher material costs.

Canadian Factory-built Housing:

Gross profit for the Canadian Factory-built Housing segment increased by $9.6 million, or 127.2% during the six months ended October 2, 2021 compared to the same period in the prior fiscal year primarily due to increased sales volume. Gross profit as a percent of net sales was 22.5% for the six months ended October 2, 2021, compared to 19.0% in the same period of the prior fiscal year primarily due to operational efficiencies from the increase in home sales, partially offset by higher material and labor costs.

Corporate/Other:

Gross profit for the Corporate/Other segment increased $1.6 million, or 25.2%, during the six months ended October 2, 2021 compared to the same period of the prior fiscal year, primarily due to increased net sales in the Company’s transportation operations.

SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES

Selling, general, and administrative expenses include foreign currency transaction gains and losses, equity compensation, and intangible amortization expense. The following table summarizes selling, general, and administrative expenses for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Selling, general, and administrative expenses:
U.S. Factory-built Housing	$	83,769		$	57,977		$	25,792		44.5	%
Canadian Factory-built Housing		5,696			3,289			2,407		73.2	%
Corporate/Other		25,898			20,914			4,984		23.8	%
Total selling, general, and administrative expenses	$	115,363		$	82,180		$	33,183		40.4	%
Selling, general, and administrative expense as a percent of net sales		11.2	%		13.8	%

Selling, general, and administrative expenses were $115.4 million for the six months ended October 2, 2021, an increase of $33.2 million, or 40.4%, compared to the same period in the prior fiscal year. The following is a summary of the change by operating segment.

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U.S. Factory-built Housing:

Selling, general, and administrative expenses for the U.S. Factory-built Housing segment increased $25.8 million, or 44.5%, during the six months ended October 2, 2021 as compared to the same period in the prior fiscal year. Selling, general, and administrative expenses, as a percent of segment net sales decreased to 9.0% for the six months ended October 2, 2021 compared to 10.9% during the comparable period of the prior fiscal year. The increase in expenses resulted from the following factors: (i) higher sales commissions and incentive compensation, which is generally based on sales volume or a measure of profitability; (ii) higher wage expense from headcount increases to support increased production; (iii) an increase in travel expenses compared to the same period in the prior fiscal year; and (iv) the impact of the acquisition of the ScotBilt operations.

Canadian Factory-built Housing:

Selling, general, and administrative expenses for the Canadian Factory-built Housing segment increased $2.4 million, or 73.2%, for the six months ended October 2, 2021 when compared to the same period of the prior fiscal year. Selling, general, and administrative expenses as a percent of segment net sales decreased to 7.5% for the six months ended October 2, 2021 compared to 8.3% during the comparable period of the prior fiscal year. The increase in selling, general, and administrative expenses resulted from an increase in commissions and incentive compensation as well as wage expense from additional headcount to support the increase in production.

Corporate/Other:

Selling, general, and administrative expenses for Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments, and intersegment eliminations. Selling, general, and administrative expenses for Corporate/Other increased $5.0 million, or 23.8%, during the six months ended October 2, 2021 as compared to the same period of the prior fiscal year due to an increase in wages, incentive and equity compensation costs as well as $1.9 million for the investment made to enhance our customer buying experience and supporting systems.

INTEREST EXPENSE, NET

The following table summarizes the components of interest expense, net for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change			% Change
Interest expense	$	1,801		$	2,061		$	(260	)		(12.6	%)
Less: Interest income		(307	)		(255	)		(52	)		20.4	%
Interest expense, net	$	1,494		$	1,806		$	(312	)		(17.3	%)
Average outstanding floor plan payable	$	28,946		$	29,188
Average outstanding long-term debt	$	25,882		$	77,330

Interest expense, net was $1.5 million for the six months ended October 2, 2021, a decrease of $0.3 million, or 17.3%, compared to the same period of the prior fiscal year. The net decrease in expense was primarily due to a lower average outstanding balance on the Company’s revolving credit facility, partially offset by the write-off of deferred financing fees of $0.3 million in association with the previously existing revolving credit facility.

OTHER EXPENSE (INCOME)

The following table summarizes other income for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Other expense (income)	$	(43	)	$	(6,813	)	$	6,770		(99.4	%)

Other income decreased $6.8 million, or 99.4%, during the six months ended October 2, 2021, compared to the same period of the prior fiscal year. The decrease is due to a reduction in the wage subsidies provided by government sponsored financial assistance programs that were

24

enacted in response to the COVID-19 pandemic. The programs included a Canadian wage subsidy benefit of $6.2 million and U.S. federal and state wage subsidy benefit of $0.6 million during the six months ended September 26, 2020.

INCOME TAX EXPENSE

The following table summarizes income tax expense for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			$ Change		% Change
Income tax expense	$	30,419		$	10,209		$	20,210		198.0	%
Effective tax rate		24.5	%		25.8	%

Income tax expense for the six months ended October 2, 2021 was $30.4 million, representing an effective tax rate of 24.5%, compared to income tax expense of $10.2 million, representing an effective tax rate of 25.8% for the six months ended September 26, 2020.

The Company’s effective tax rate for the six months ended October 2, 2021 differs from the federal statutory income tax rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, results in foreign jurisdictions, and tax benefits from vested equity compensation. The Company’s effective tax rate for the six months ended September 26, 2020 differs from the federal statutory income tax rate of 21.0% due primarily to the effect of non-deductible expenses, state and local income taxes, tax credits, and results in foreign jurisdictions.

25

ADJUSTED EBITDA

The following table reconciles net income, the most directly comparable U.S. GAAP measure, to Adjusted EBITDA, a non-GAAP financial measure, for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021		September 26, 2020		$ Change			% Change
Net income	$	93,624	$	29,414	$	64,210		*
Income tax expense		30,419		10,209		20,210		*
Interest expense, net		1,494		1,806		(312	)		(17.3	%)
Depreciation and amortization		10,283		8,690		1,593			18.3	%
Equity-based compensation (for awards granted prior to December 31, 2018)		—		1,358		(1,358	)	*
Adjusted EBITDA	$	135,820	$	51,477	$	84,343		*

* Indicates that the calculated percentage is not meaningful

Adjusted EBITDA for the six months ended October 2, 2021 was $135.8 million, an increase of $84.3 million, from the same period of the prior fiscal year. The increase is primarily a result of higher operating income due to increases in sales volume and gross margin, partially offset by higher SG&A expenses.

The Company defines Adjusted EBITDA as net income or loss plus; (a) the provision for income taxes; (b) interest expense, net; (c) depreciation and amortization; (d) gain or loss from discontinued operations; (e) equity based compensation for awards granted prior to December 31, 2018; (f) non-cash restructuring charges and impairment of assets; and (g) other non-operating costs including those for the acquisition and integration or disposition of businesses and idle facilities. Adjusted EBITDA is not a measure of earnings calculated in accordance with U.S. GAAP and should not be considered an alternative to, or more meaningful than, net income or loss prepared on a U.S. GAAP basis. Adjusted EBITDA does not purport to represent cash flow provided by, or used in, operating activities as defined by U.S. GAAP, which is presented in the Statement of Cash Flows. In addition, Adjusted EBITDA is not necessarily comparable to similarly titled measures reported by other companies.

In evaluating Adjusted EBITDA, investors should be aware that, in the future, the Company may incur expenses similar to those adjusted for in this presentation. This presentation of Adjusted EBITDA should not be construed as an implication that the Company’s future results will be unaffected by unusual or nonrecurring items.

Adjusted EBITDA has important limitations as an analytical tool and you should not consider it in isolation or as a substitute for analysis of our results as reported under U.S. GAAP. Some of these limitations are:

Adjusted EBITDA:

does not reflect the interest expense on our debt;

excludes impairments; and

does not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;

Also about Adjusted EBITDA:

although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements; and

other companies in our industry may calculate Adjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.

Given these limitations, Adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our U.S. GAAP results and using non-GAAP financial measures only on a supplemental basis.

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BACKLOG

Although orders from customers can be cancelled at any time without penalty, and unfilled orders are not necessarily an indication of future business, the Company’s unfilled U.S. and Canadian manufacturing orders at October 2, 2021 totaled $1,369 million compared to $390.1 million at September 26, 2020. The increase in backlog was driven by increased demand for single-family homes, which resulted in order levels that significantly outpaced production in both the U.S. and Canada. Our ability to increase production rates to keep pace with orders is limited by individual plant capacity, the availability of and time needed to train new employees, employee attendance and availability of materials, including (most recently) raw material allocations by certain of our suppliers. We may experience greater order cancellations in the future as a result of higher prices and the longer time required to manufacture and deliver our products.

Liquidity and Capital Resources

Sources and Uses of Cash

The following table presents summary cash flow information for the six months ended October 2, 2021 and September 26, 2020:

	Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020
Net cash provided by (used in):
Operating activities	$	88,887		$	63,842
Investing activities		(15,246	)		(1,334	)
Financing activities		(25,553	)		(8,936	)
Effect of exchange rate changes on cash, cash equivalents		(411	)		1,259
Net increase in cash and cash equivalents		47,677			54,831
Cash and cash equivalents at beginning of period		262,581			209,455
Cash and cash equivalents at end of period	$	310,258		$	264,286

The Company’s primary sources of liquidity are cash flows from operations and existing cash balances. Cash balances and cash flows from operations for the next year are expected to be adequate to cover working capital requirements, capital expenditures, and debt payment obligations. The Company does not have any scheduled long-term debt maturities in the next twelve months. On July 7, 2021, the Company entered into an Amended and Restated Credit Agreement which provides for a $200.0 million revolving credit facility, including a $45.0 million letter of credit sub-facility. At October 2, 2021 $169.6 million was available for borrowing under the Amended Credit Agreement. The Company’s revolving credit facility includes (i) a maximum consolidated total net leverage ratio of 3.25 to 1.00, subject to an upward adjustment upon the consummation of a material acquisition, and (ii) a minimum interest coverage ratio of 3.00 to 1.00. The Company anticipates compliance with its debt covenants and projects its level of cash availability to be in excess of cash needed to operate the business for the next year. In the event operating cash flow and existing cash balances were deemed inadequate to support the Company’s liquidity needs, and one or more capital resources were to become unavailable, the Company would revise operating strategies accordingly.

Cash provided by operating activities was $88.9 million for the six months ended October 2, 2021 compared to $63.8 million for the six months ended September 26, 2020. Cash provided by operating activities increased due to higher net income, partially offset by an increase in inventory from higher material costs and higher stocking levels to mitigate supply chain challenges, an increase in accounts receivable from higher sales volumes, and an increase in prepaid and other assets primarily from the capitalization of cloud computing costs in fiscal 2022.

Cash used in investing activities was $15.2 million for the six months ended October 2, 2021 compared to $1.3 million for the six months ended September 26, 2020. The increase in cash used for investing activities was primarily related to an increase in capital expenditures in the current period which was related to the acquisition of two idle manufacturing facilities in Texas and investments in plant operations which were deferred in the prior-year due to the pandemic. The Company suspended all but critical capital projects in the first half of fiscal 2021 due to COVID-19 concerns. Capital spending in the first half of fiscal 2022 reflects our reversion to normal, planned spending.

Cash used in financing activities was $25.6 million for the six months ended October 2, 2021 compared to $8.9 million for the six months ended September 26, 2020. The increase in cash used for financing was primarily related to the repayment of the Company's previously existing revolving credit facility and payments of deferred financing fees related to the Amended Credit Agreement.

Critical Accounting Policies

For a discussion of our critical accounting policies that management believes affect its more significant judgments and estimates used in the preparation of our Consolidated Financial Statements, see Part II, Item 7 of the Fiscal 2021 Annual Report, under the heading “Critical Accounting Policies.” There have been no significant changes in our significant accounting policies or critical accounting estimates discussed in the Fiscal 2021 Annual Report.

27

Recently Issued Accounting Pronouncements

For information on the impact of recently issued accounting pronouncements, see Note 1, “Basis of Presentation – Recently Issued Accounting Pronouncements,” to the condensed consolidated financial statements included in this Report.

Forward-Looking Statements
 

Some of the statements in this Report are not historical in nature and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about our expectations regarding our future liquidity, earnings, expenditures, and financial condition. These statements are often identified by the words “will,” “could”, “should,” “anticipate,” “believe,” “expect,” “intend,” “estimate,” “hope,” or similar expressions. These statements reflect management’s current views with respect to future events and are subject to risks and uncertainties. There are risks and uncertainties, many of which are beyond our control, that could cause our actual results to differ materially from those in our forward-looking statements, including regional, national and international economic, financial, public health and labor conditions, and the following:

The COVID-19 pandemic, which has had, and could continue to have, significant adverse effects on us;

supply-related issues, including prices and availability of materials;

labor-related issues;

the cyclicality and seasonality of the housing industry and its sensitivity to changes in general economic or other business conditions;

demand fluctuations in the housing industry;

the possible unavailability of additional capital when needed;

competition and competitive pressures;

changes in consumer preferences for our products or our failure to gauge those preferences;

quality problems, including the quality of parts sourced from suppliers and related liability and reputational issues;

data security breaches, cybersecurity attacks, and other information technology disruptions;

the potential disruption of operations caused by the conversion to new information systems;

the extensive regulation affecting the production and sale of factory-built housing and the effects of possible changes in laws with which we must comply;

the potential impact of natural disasters on sales and raw material costs;

the risks associated with mergers and acquisitions, including integration of operations and information systems;

periodic inventory adjustments by, and changes to relationships with, independent retailers;

changes in interest and foreign exchange rates;

insurance coverage and cost issues;

the possibility that all or part of our intangible assets, including goodwill, might become impaired;

the possibility that our risk management practices may leave us exposed to unidentified or unanticipated risks; and

other risks described in Part I — Item 1A, "Risk Factors," included in the Fiscal 2021 Annual Report, as well as the risks and information provided from time to time in our other periodic reports filed with the Securities and Exchange Commission.

If any of the risks or uncertainties referred to above materializes or if any of the assumptions underlying our forward-looking statements proves to be incorrect, then differences may arise between our forward-looking statements and our actual results, and such differences may be material. Investors should not place undue reliance on our forward-looking statements, which speak only as of the date of this report. We assume no obligation to update, amend or clarify them to reflect events, new information or circumstances occurring after the date hereof, except as required by law.

28

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

For a discussion of the Company’s interest rate and foreign exchange risks, see Part II, Item 7A of the Fiscal 2021 Annual Report, under the heading "Quantitative and Qualitative Disclosures about Market Risk." There have been no significant changes in such risks since April 3, 2021.

Item 4. CONTROLS AND PROCEDURES

Evaluation of disclosure controls and procedures

The Company maintains disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) is recorded, processed, summarized, and reported within the specified time periods and accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

The Company’s management, with the participation of the CEO and CFO, evaluated the effectiveness of the Company’s disclosure controls and procedures pursuant to Rule 13a-15(e) of the Exchange Act at October 2, 2021. Based upon this evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective as of October 2, 2021.

Changes in internal control over financial reporting

There have been no changes in our internal control over financial reporting during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting

29

PART II – OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

We are involved from time to time in various legal proceedings and claims, including, without limitation, commercial or contractual disputes, product liability claims and other matters. For additional information on legal proceedings, see Note 13 “Commitments, Contingencies and Legal Proceedings – Legal Proceedings,” to the condensed consolidated financial statements included in this Report.

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Item 6. EXHIBITS

Exhibit Number	Description
31.1	Certification of Chief Executive Officer pursuant to Exchange Act rules 13a-4 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. †
31.2	Certification of Chief Financial Officer pursuant to Exchange Act rules 13a-4 and 15d-14, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. †
32	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. †
101 (INS)	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101(SCH)	Inline XBRL Taxonomy Extension Schema Document.
101(CAL)	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101(DEF)	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101(LAB)	Inline XBRL Taxonomy Extension Label Linkbase Document.
101(PRE)	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

† Filed herewith.

31

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 thereunto duly authorized.

Skyline Champion Corporation

Registrant

Signature	Title	Date
/s/ Mark Yost	President and Chief Executive Officer	November 3, 2021
Mark Yost	(Principal Executive Officer)
/s/ Laurie Hough	Executive Vice President, Chief Financial Officer and Treasurer	November 3, 2021
Laurie Hough	(Principal Financial Officer)

32

EX-31.1

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Mark Yost, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Skyline Champion Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	November 3, 2021
By:	/s/ Mark Yost
	Mark Yost
	Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Laurie Hough, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Skyline Champion Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated:	November 3, 2021
By:	/s/ Laurie Hough
	Laurie Hough
	Executive Vice President, Chief Financial Officer, and Treasurer (Principal Financial Officer)

EX-32

Exhibit 32

CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND

CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. §1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Skyline Champion Corporation (the “Registrant”) for the period ending October 2, 2021 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Registrant hereby certifies, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that to his or her knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

November 3, 2021

/s/ Mark Yost

Mark Yost

Chief Executive Officer (Principal Executive Officer)

/s/ Laurie Hough

Laurie Hough

Executive Vice President, Chief Financial Officer, and Treasurer

(Principal Financial Officer)

XML

Document and Entity Information - shares	6 Months Ended
	Oct. 02, 2021	Oct. 21, 2021
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Oct. 02, 2021
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Entity Registrant Name	Skyline Champion Corporation
Entity Central Index Key	0000090896
Current Fiscal Year End Date	--04-02
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		56,799,419
Entity File Number	001-04714
Entity Tax Identification Number	35-1038277
Entity Address, Address Line One	755 West Big Beaver Road
Entity Address, Address Line Two	Suite 1000
Entity Address, City or Town	Troy
Entity Address, State or Province	MI
Entity Address, Postal Zip Code	48084
City Area Code	248
Local Phone Number	614-8211
Title of 12(b) Security	Common Stock
Trading Symbol	SKY
Security Exchange Name	NYSE
Entity Incorporation, State or Country Code	IN
Entity Interactive Data Current	Yes
Document Transition Report	false
Document Quarterly Report	true

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021
Current assets:
Cash and cash equivalents	$ 310,258	$ 262,581
Trade accounts receivable, net	72,886	57,481
Inventories, net	179,976	166,113
Other current assets	20,315	13,592
Total current assets	583,435	499,767
Long-term assets:
Property, plant, and equipment, net	122,905	115,140
Goodwill	191,970	191,803
Amortizable intangible assets, net	55,073	58,835
Deferred tax assets	13,832	19,914
Other noncurrent assets	43,115	32,443
Total assets	1,010,330	917,902
Current liabilities:
Floor plan payable	30,840	25,733
Accounts payable	57,694	57,214
Other current liabilities	200,747	180,695
Total current liabilities	289,281	263,642
Long-term liabilities:
Long-term debt	12,430	39,330
Deferred tax liabilities	4,620	4,280
Other	41,021	42,039
Total long-term liabilities	58,071	85,649
Stockholders' Equity:
Common stock, $0.0277 par value, 115,000 shares authorized, 56,796 and 56,640 shares issued as of October 2, 2021 and April 3, 2021, respectively	1,572	1,569
Additional paid-in capital	496,059	491,668
Retained earnings	173,513	82,898
Accumulated other comprehensive loss	(8,166)	(7,524)
Total stockholders' equity	662,978	568,611
Total liabilities and stockholders' equity	$ 1,010,330	$ 917,902

XML

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Oct. 02, 2021	Apr. 03, 2021
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.0277	$ 0.0277
Common stock, shares authorized	115,000,000	115,000,000
Common stock, shares issued	56,796,000	56,640,000

XML

Condensed Consolidated Income Statements - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Income Statement [Abstract]
Net sales	$ 524,225	$ 322,366	$ 1,034,422	$ 595,651
Cost of sales	394,898	259,573	793,565	478,855
Gross profit	129,327	62,793	240,857	116,796
Selling, general, and administrative expenses	61,340	41,373	115,363	82,180
Operating income	67,987	21,420	125,494	34,616
Interest expense, net	845	864	1,494	1,806
Other expense (income)	11	(2,599)	(43)	(6,813)
Income before income taxes	67,131	23,155	124,043	39,623
Income tax expense	16,408	5,644	30,419	10,209
Net income	$ 50,723	$ 17,511	$ 93,624	$ 29,414
Net income per share:
Basic	$ 0.89	$ 0.31	$ 1.65	$ 0.52
Diluted	$ 0.89	$ 0.31	$ 1.64	$ 0.52

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Statement Of Income And Comprehensive Income [Abstract]
Net income	$ 50,723	$ 17,511	$ 93,624	$ 29,414
Other comprehensive income (loss):
Foreign currency translation adjustments	(1,520)	861	(642)	1,956
Total comprehensive income	$ 49,203	$ 18,372	$ 92,982	$ 31,370

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020
Cash flows from operating activities
Net income	$ 93,624	$ 29,414
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	6,521	5,969
Amortization of intangible assets	3,762	2,721
Amortization of deferred financing fees	509	253
Equity-based compensation	4,213	3,624
Deferred taxes	6,421	2,655
Loss on disposal of property, plant, and equipment	686	15
Foreign currency transaction loss (gain)	35	(219)
Change in assets and liabilities:
Accounts receivable	(15,351)	(984)
Inventories	(14,138)	(990)
Prepaids and other assets	(17,934)	(2,063)
Accounts payable	407	5,406
Accrued expenses and other liabilities	20,132	18,041
Net cash provided by operating activities	88,887	63,842
Cash flows from investing activities
Additions to property, plant, and equipment	(15,105)	(2,552)
Cash paid for acquisition	(207)
Proceeds from maturity of Company owned life insurance policy		1,186
Proceeds from disposal of property, plant, and equipment	66	32
Net cash used in investing activities	(15,246)	(1,334)
Cash flows from financing activities
Changes in floor plan financing, net	5,107	(7,316)
Payments on deferred financing fees	(1,130)
Payments on revolving debt facility	(26,900)
Stock option exercises	377	67
Tax payments for equity-based compensation	(3,007)	(1,687)
Net cash used in financing activities	(25,553)	(8,936)
Effect of exchange rate changes on cash and cash equivalents	(411)	1,259
Net increase in cash and cash equivalents	47,677	54,831
Cash and cash equivalents at beginning of period	262,581	209,455
Cash and cash equivalents at end of period	$ 310,258	$ 264,286

XML

Consolidated Statement of Equity - USD ($) shares in Thousands, $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Retained Earnings [Member] Cumulative Effect, Period of Adoption, Adjustment [Member]	Accumulated Other Comprehensive Loss [Member]
Beginning balance at Mar. 28, 2020	$ 474,315	$ (245)	$ 1,570	$ 485,552	$ (48)	$ (245)	$ (12,759)
Beginning balance, shares at Mar. 28, 2020			56,665
Net income	$ 29,414				29,414
Accounting Standards Update [Extensible List]	Accounting Standards Update 2016-13 [Member]
Equity-based compensation	$ 3,624			3,624
Net common stock issued under equity-based compensation plans	(1,620)		$ (1)	(1,619)
Net common stock issued under equity-based compensation plans, shares			(27)
Foreign currency translation adjustments	1,956						1,956
Ending balance at Sep. 26, 2020	507,444		$ 1,569	487,557	29,121		(10,803)
Ending balance, shares at Sep. 26, 2020			56,638
Beginning balance at Jun. 27, 2020	489,297		$ 1,570	487,781	11,610		(11,664)
Beginning balance, shares at Jun. 27, 2020			56,665
Net income	17,511				17,511
Equity-based compensation	1,398			1,398
Net common stock issued under equity-based compensation plans	(1,623)		$ (1)	(1,622)
Net common stock issued under equity-based compensation plans, shares			(27)
Foreign currency translation adjustments	861						861
Ending balance at Sep. 26, 2020	507,444		$ 1,569	487,557	29,121		(10,803)
Ending balance, shares at Sep. 26, 2020			56,638
Beginning balance at Apr. 03, 2021	568,611		$ 1,569	491,668	82,898		(7,524)
Beginning balance, shares at Apr. 03, 2021			56,640
Net income	93,624				93,624
Equity-based compensation	4,213			4,213
Net common stock issued under equity-based compensation plans	(2,828)		$ 3	178	(3,009)
Net common stock issued under equity-based compensation plans, shares			156
Foreign currency translation adjustments	(642)						(642)
Ending balance at Oct. 02, 2021	662,978		$ 1,572	496,059	173,513		(8,166)
Ending balance, shares at Oct. 02, 2021			56,796
Beginning balance at Jul. 03, 2021	612,583		$ 1,571	493,191	124,467		(6,646)
Beginning balance, shares at Jul. 03, 2021			56,699
Net income	50,723				50,723
Equity-based compensation	2,772			2,772
Net common stock issued under equity-based compensation plans	(1,580)		$ 1	96	(1,677)
Net common stock issued under equity-based compensation plans, shares			97
Foreign currency translation adjustments	(1,520)						(1,520)
Ending balance at Oct. 02, 2021	$ 662,978		$ 1,572	$ 496,059	$ 173,513		$ (8,166)
Ending balance, shares at Oct. 02, 2021			56,796

XML

Basis of Presentation and Business

6 Months Ended

Oct. 02, 2021

Accounting Policies [Abstract]

Basis of Presentation and Business

1. Basis of Presentation and Business

Nature of Operations: Skyline Champion Corporation (the “Company”) is a leading producer of factory-built housing in the United States (“U.S.”) and Canada. The Company’s operations consist of manufacturing, retail, and transportation activities. The Company operates 35 manufacturing facilities throughout the U.S. and five manufacturing facilities in western Canada. These facilities primarily construct factory-built, timber-framed manufactured, and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 18 sales centers that sell manufactured houses to consumers primarily in the Southern U.S. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles and other products throughout the U.S. and Canada.

COVID-19 Government Financial Assistance: The outbreak of a novel strain of coronavirus ("COVID-19") was declared a global pandemic by the World Health Organization in March 2020. Various government programs were announced to provide financial relief for affected businesses, including the Employee Retention Credit under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") and state level programs in the United States and the Canada Emergency Wage Subsidy ("CEWS") under the COVID-19 Economic Response Plan in Canada. The Company recognized $0.6 million for wage subsidies under the CARES Act and other state level programs in the United States during the first quarter of fiscal 2021. The Company recognized $2.6 million and $6.2 million of payroll subsidies under CEWS during the three and six months ended September 26, 2020, respectively. The Company’s policy is to account for these subsidies as Other Income in the period in which the related costs are incurred and the Company is reasonably assured to receive payment. In addition, the CARES Act allows for deferring payment of certain payroll taxes. Through October 2, 2021, the Company has deferred $11.8 million of payroll taxes that will be paid beginning in December 2021.

Basis of Presentation: The accompanying unaudited condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Quarterly Reports on Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations.

The condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries after elimination of intercompany balances and transactions. In the opinion of management, these statements include all normal recurring adjustments necessary to fairly state the Company’s consolidated results of operations, cash flows, and financial position. The Company has evaluated subsequent events after the balance sheet date through the date of the filing of this report with the SEC. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on May 26, 2021 (the “Fiscal 2021 Annual Report”).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes thereto. Actual results could differ from those estimates. The condensed consolidated income statements, condensed consolidated statements of comprehensive income, and condensed consolidated statements of cash flows for the interim periods are not necessarily indicative of the results of operations or cash flows for the full year.

The Company’s allowance for credit losses on financial assets measured at amortized cost reflects management’s estimate of credit losses over the remaining expected life of such assets, measured primarily using historical experience, as well as current economic conditions and forecasts that affect the collectability of the reported amount. Expected credit losses for newly recognized financial assets, as well as changes to expected credit losses during the period, are recognized in earnings. Accounts receivable are reflected net of reserves of $0.5 million and $0.4 million at October 2, 2021 and April 3, 2021, respectively. At both October 2, 2021 and April 3, 2021, other notes receivable are reflected net of reserves of $0.4 million.

The Company’s fiscal year is a 52- or 53-week period that ends on the Saturday nearest to March 31. The Company’s current fiscal year, “fiscal 2022,” will end on April 2, 2022 and will include 52 weeks. References to “fiscal 2021” refer to the Company’s fiscal year ended April 3, 2021. The three and six months ended October 2, 2021 and September 26, 2020 each included 13 and 26 weeks, respectively.

There were no accounting standards recently issued that are expected to have a material impact on the Company’s financial position or results of operations. 

XML

Business Acquisition

6 Months Ended

Oct. 02, 2021

Business Combinations [Abstract]

Business Acquisition

2. Business Acquisition

ScotBilt Acquisition

On February 28, 2021, the Company acquired 100% of the membership interests of ScotBilt Homes, LLC and related companies (“ScotBilt”), a builder of manufactured homes with annual revenues of approximately $79.0 million, for a purchase price of $53.0 million. Under the terms of the purchase agreement, the preliminary purchase price was adjusted for cash held by ScotBilt at the closing date and working capital adjustments resulting in an initial total purchase consideration of $54.5 million. In the first quarter of fiscal 2022, the Company adjusted the preliminary purchase price allocation by $0.2 million as a result of the final working capital settlement. The Company accounted for the acquisition as a business combination under the acquisition method of accounting provided by FASB ASC 805, Business Combinations (“ASC 805”). As such, the purchase price was allocated to the net assets acquired, inclusive of intangible assets, with the excess fair value recorded to goodwill. The purchase price allocation for this acquisition is preliminary and could change.

The preliminary allocation of the purchase price was as follows:
 

(Dollars in thousands)
Cash	$	1,521
Trade accounts receivable		2,256
Inventory		6,752
Property, plant, and equipment		10,466
Other assets		1,164
Accounts payable and accrued liabilities		(7,432	)
Intangibles		21,100
Goodwill		18,449
Total purchase price allocation	$	54,276

Goodwill is primarily attributable to expected synergies from the combination of the companies, including, but not limited to, expected cost synergies through procurement activities and operational improvements through sharing of best practices. Goodwill, which is deductible for income tax purposes, was allocated to the U.S. Factory-built Housing reporting unit.

Cash, trade accounts receivable, inventory, other assets, accounts payable, and accrued liabilities were generally stated at historical carrying values given the short-term nature of these assets and liabilities. Intangible assets include $13.0 million in customer relationships and $8.1 million associated with the ScotBilt trade name and were based on an independent appraisal. The fair value of the customer relationships was determined using the multi-period excess earnings method and the fair value of the trade name was determined using the relief-from-royalty method. The Company estimates that each intangible asset has a weighted average useful life of ten years from the acquisition date. Fair value estimates of property, plant, and equipment were based on independent appraisals, giving consideration to the highest and best use of the assets. Key assumptions used in the appraisals were based on a combination of market, cost, and sales comparison approaches, as appropriate. Level 3 fair value estimates of $10.5 million related to property, plant, and equipment and $21.1 million related to intangible assets were recorded in the accompanying consolidated balance sheet as of April 3, 2021.

The acquisition of ScotBilt was a taxable business combination. Therefore, the Company’s tax basis in the assets acquired and the liabilities assumed approximate the respective fair values at the acquisition date.

XML

Inventories, Net

6 Months Ended

Oct. 02, 2021

Inventory Disclosure [Abstract]

Inventories, Net

3. Inventories, net

The components of inventory, net of reserves for obsolete inventory, were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Raw materials	$	104,179	$	91,916
Work in process		24,036		21,642
Finished goods and other		51,761		52,555
Total inventories, net	$	179,976	$	166,113

At October 2, 2021 and April 3, 2021, reserves for obsolete inventory were $4.5 million and $4.6 million, respectively.

XML

Property, Plant, and Equipment

6 Months Ended

Oct. 02, 2021

Property Plant And Equipment [Abstract]

Property, Plant, and Equipment

4. Property, Plant, and Equipment

Property, plant, and equipment are stated at cost. Depreciation is calculated primarily on a straight-line basis, generally over the following estimated useful lives: land improvements – 3 to 10 years; buildings and improvements – 8 to 25 years; and vehicles and machinery and equipment – 3 to 8 years. Depreciation expense for the three months ended October 2, 2021 and September 26, 2020 was $3.3 million and $3.1 million, respectively. Depreciation expense for the six months ended October 2, 2021 and September 26, 2020 was $6.5 million and $6.0 million, respectively.

The components of property, plant, and equipment were as follows:

(Dollars in thousands)	October 2, 2021			April 3, 2021
Land and improvements	$	38,966		$	36,470
Buildings and improvements		96,324			97,005
Machinery and equipment		61,384			57,790
Construction in progress		10,591			1,889
Property, plant, and equipment, at cost		207,265			193,154
Less: accumulated depreciation		(84,360	)		(78,014	)
Property, plant, and equipment, net	$	122,905		$	115,140

XML

Goodwill, Intangible Assets, and Cloud Computing Arrangements

6 Months Ended

Oct. 02, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill, Intangible Assets, and Cloud Computing Arrangements

5. Goodwill, Intangible Assets, and Cloud Computing Arrangements

Goodwill

Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. At October 2, 2021 and April 3, 2021, the Company had goodwill of $192.0 million and $191.8 million, respectively.

Intangible Assets

The components of amortizable intangible assets were as follows:

(Dollars in thousands)	October 2, 2021									April 3, 2021
	Customer Relationships			Trade Names			Total			Customer Relationships			Trade Names			Total
Gross carrying amount	$	61,923		$	21,393		$	83,316		$	61,963		$	21,409		$	83,372
Accumulated amortization		(20,934	)		(7,309	)		(28,243	)		(18,158	)		(6,379	)	$	(24,537	)
Amortizable intangibles, net	$	40,989		$	14,084		$	55,073		$	43,805		$	15,030		$	58,835

During the three months ended October 2, 2021 and September 26, 2020, amortization of intangible assets was $1.9 million and $1.3 million, respectively. During the six months ended October 2, 2021 and September 26, 2020, amortization of intangible assets was $3.8 million and $2.7 million, respectively.

Cloud Computing Arrangements

The Company capitalizes costs associated with the development of cloud computing arrangements in a manner consistent with internally developed technology. At October 2, 2021 and April 3, 2021, the Company had capitalized cloud computing costs of $10.6 million and $0.3 million within other noncurrent assets, respectively. There was no amortization of capitalized cloud computing costs during the three and six months ended October 2, 2021 and September 26, 2020, respectively, as the related cloud computing technology has not yet been placed in service.

XML

Other Current Liabilities

6 Months Ended

Oct. 02, 2021

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

6. Other Current Liabilities

The components of other current liabilities were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Customer deposits	$	59,807	$	58,888
Accrued volume rebates		23,048		18,207
Accrued warranty obligations		25,419		24,033
Accrued compensation and payroll taxes		45,484		42,560
Accrued insurance		15,716		12,421
Other		31,273		24,586
Total other current liabilities	$	200,747	$	180,695

XML

Accrued Warranty Obligations

6 Months Ended

Oct. 02, 2021

Guarantees And Product Warranties [Abstract]

Accrued Warranty Obligations

7. Accrued Warranty Obligations

Changes in the accrued warranty obligations were as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Balance at beginning of period	$	31,079		$	24,695		$	30,469		$	24,969
Warranty expense		10,880			8,394			21,184			14,753
Cash warranty payments		(10,104	)		(8,629	)		(19,798	)		(15,262	)
Balance at end of period		31,855			24,460			31,855			24,460
Less: noncurrent portion in other long-term liabilities		(6,436	)		(5,790	)		(6,436	)		(5,790	)
Total current portion	$	25,419		$	18,670		$	25,419		$	18,670

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Debt and Floor Plan Payable

6 Months Ended

Oct. 02, 2021

Debt Disclosure [Abstract]

Debt and Floor Plan Payable

8. Debt and Floor Plan Payable

Long-term debt consisted of the following:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Revolving credit facility maturing in 2026	$	—	$	26,900
Obligations under industrial revenue bonds due 2029		12,430		12,430
Total debt		12,430		39,330
Less: current portion		—		—
Total long-term debt	$	12,430	$	39,330

On July 7, 2021, the Company entered into an Amended and Restated Credit Agreement with a syndicate of banks that provides for a revolving credit facility of up to $200.0 million, including a $45.0 million letter of credit sub-facility (“Amended Credit Agreement”). The Amended Credit Agreement replaced the Company’s previously existing $100.0 million revolving credit facility. Outstanding borrowings of $26.9 million on the Company’s previous revolving credit facility were repaid in July 2021. The Amended Credit Agreement allows the Company to draw down, repay and re-draw loans on the available funds during the term, subject to certain terms and conditions, matures in July 2026 and has no scheduled amortization. The Company capitalized $1.1 million of deferred financing fees associated with the Amended Credit Agreement, which is included in other noncurrent assets on the consolidated balance sheet. The Company wrote off $0.3 million of deferred financing fees associated with the previously existing credit facility, which is included in interest expense, net for the three and six months ended October 2, 2021.

The interest rate on borrowings under the Amended Credit Agreement adjusts based on the consolidated total net leverage of the Company from a high of LIBOR plus 1.875% and ABR plus 0.875%, at the election of the Company, when the consolidated total net leverage ratio is equal to or greater than 2.25:1.00, to a low of LIBOR plus 1.125% and ABR plus 0.125% when the consolidated total net leverage is below 0.50:1.00. In addition, the Company is obligated to pay an unused line fee ranging between 0.15% and 0.3% (depending on the consolidated total net leverage ratio) in respect of unused commitments under the Amended Credit Agreement. At October 2, 2021 the interest rate under the Amended Credit Agreement was 1.2%. At October 2, 2021, letters of credit issued under the Amended Credit Agreement totaled $30.4 million and total available borrowings were $169.6 million.

Obligations under industrial revenue bonds are supported by letters of credit and bear interest based on a municipal bond index rate. The weighted-average interest rate at October 2, 2021, including related costs and fees, was 1.74%. The industrial revenue bonds require lump-sum payments of principal upon maturity in 2029.

The Amended Credit Agreement contains covenants that restrict the amount of additional debt, liens and certain payments, including equity buybacks, investments, dispositions, mergers and consolidations, among other restrictions as defined. The Company was in compliance with all covenants of the Amended Credit Agreement as of October 2, 2021.

Floor Plan Payable

The Company’s retail operations utilize floor plan financing to fund the purchase of manufactured homes for display or resale. At October 2, 2021 and April 3, 2021, the Company had outstanding borrowings on floor plan financing agreements of $30.8 million and $25.7 million, respectively. Total credit line capacity provided under the agreements was $57.0 million as of October 2, 2021. Borrowings are secured by the homes and are required to be repaid when the Company sells the home to a customer.

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Revenue Recognition

6 Months Ended

Oct. 02, 2021

Revenue From Contract With Customer [Abstract]

Revenue Recognition

9. Revenue Recognition

The following tables disaggregate the Company’s revenue by sales category for the three and six months ended October 2, 2021 and September 26, 2020:

	Three months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	469,127	$	38,501	$	—	$	507,628
Commercial		2,572		—		—		2,572
Transportation		—		—		14,025		14,025
Total	$	471,699	$	38,501	$	14,025	$	524,225
	Six months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	925,018	$	76,332	$	—	$	1,001,350
Commercial		4,001		—		—		4,001
Transportation		—		—		29,071		29,071
Total	$	929,019	$	76,332	$	29,071	$	1,034,422
	Three months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	275,969	$	24,558	$	—	$	300,527
Commercial		7,391		—		—		7,391
Transportation		—		—		14,448		14,448
Total	$	283,360	$	24,558	$	14,448	$	322,366
	Six months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	524,828	$	39,753	$	—	$	564,581
Commercial		7,391		—		—		7,391
Transportation		—		—		23,679		23,679
Total	$	532,219	$	39,753	$	23,679	$	595,651

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Income Taxes

6 Months Ended

Oct. 02, 2021

Income Tax Disclosure [Abstract]

Income Taxes

10. Income Taxes

For the three months ended October 2, 2021 and September 26, 2020, the Company recorded $16.4 million and $5.6 million of income tax expense and had an effective tax rate during each period of 24.4%. For the six months ended October 2, 2021 and September 26, 2020, the Company recorded $30.4 million and $10.2 million of income tax expense and had an effective tax rate of 24.5% and 25.8%, respectively.

The Company’s effective tax rate for the three months and six months ended October 2, 2021 differs from the federal statutory rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, results in foreign jurisdictions, and tax benefits from vested equity compensation. The Company’s effective tax rate for the three months and six months ended September 26, 2020 differs from the federal statutory rate of 21.0% due primarily to the effect of state and local income taxes, non-deductible expenses, tax credits, and results in foreign jurisdictions.

At October 2, 2021, the Company had no unrecognized tax benefits. The Company does not anticipate any material changes to uncertain tax benefits in the next twelve months. The Company records interest and penalties related to unrecognized tax benefits as a component of income tax expense.

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Earnings Per Share

6 Months Ended

Oct. 02, 2021

Earnings Per Share [Abstract]

Earnings Per Share

11. Earnings Per Share

Basic net income per share (“EPS”) attributable to the Company was computed by dividing net income attributable to the Company by the average number of common shares outstanding during the period. Certain of the Company’s time-based restricted share awards were considered participating securities prior to the completion of the vesting period. The vesting for these time-based shares occurred in the second quarter of fiscal 2021. Diluted earnings per common share is computed based on the more dilutive of: (i) the two class method, assuming the participating securities are not exercised or converted; or (ii) the summation of average common shares outstanding and additional common shares that would have been outstanding if the dilutive potential common shares had been issued. During the three and six months ended September 26, 2020, the two-class method was more dilutive.

The following table sets forth the computation of basic and diluted earnings per common share:

	Three months ended					Six months ended
(Dollars and shares in thousands, except per share data)	October 2, 2021		September 26, 2020				October 2, 2021		September 26, 2020
Numerator:
Net income	$	50,723	$	17,511			$	93,624	$	29,414
Undistributed earnings allocated to participating securities		—		(19	)			—		(53	)
Net income attributable to the Company's common shareholders	$	50,723	$	17,492			$	93,624	$	29,361
Denominator:
Basic weighted-average shares outstanding		56,808		56,654				56,757		56,593
Dilutive securities		400		255				455		238
Diluted weighted-average shares outstanding		57,208		56,909				57,212		56,831
Basic net income per share	$	0.89	$	0.31			$	1.65	$	0.52
Diluted net income per share	$	0.89	$	0.31			$	1.64	$	0.52

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Segment Information

6 Months Ended

Oct. 02, 2021

Segment Reporting [Abstract]

Segment Information

12. Segment Information

Financial results for the Company's reportable segments have been prepared using a management approach, which is consistent with the basis and manner in which financial information is evaluated by the Company's chief operating decision maker in allocating resources and in assessing performance. The Company’s chief operating decision maker, the Chief Executive Officer, evaluates the performance of the Company’s segments primarily based on net sales, earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and operating assets.

The Company operates in two reportable segments: (i) U.S. Factory-built Housing, which includes manufacturing and retail housing operations and (ii) Canadian Factory-built Housing. Corporate/Other includes the Company’s transportation operations, corporate costs incurred for all segments and intersegment eliminations. Segments are generally determined by geography. Segment data includes intersegment revenues and corporate office costs that are directly and exclusively incurred for each segment. Total assets for Corporate/Other primarily includes cash and certain deferred tax items not specifically allocated to another segment.

Selected financial information by reportable segment was as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Net sales:
U.S. Factory-built Housing	$	471,699		$	283,360		$	929,019		$	532,219
Canadian Factory-built Housing		38,501			24,558			76,332			39,753
Corporate/Other		14,025			14,448			29,071			23,679
Consolidated net sales	$	524,225		$	322,366		$	1,034,422		$	595,651
Operating income:
U.S. Factory-built Housing EBITDA	$	78,075		$	28,697		$	141,092		$	53,090
Canadian Factory-built Housing EBITDA		6,390			5,951			12,056			10,857
Corporate/Other EBITDA		(11,351	)		(6,221	)		(17,328	)		(13,828	)
Other income		11			(2,599	)		(43	)		(6,813	)
Depreciation		(3,264	)		(3,048	)		(6,521	)		(5,969	)
Amortization		(1,874	)		(1,360	)		(3,762	)		(2,721	)
Consolidated operating income	$	67,987		$	21,420		$	125,494		$	34,616
Depreciation:
U.S. Factory-built Housing	$	2,619		$	2,391		$	5,229		$	4,789
Canadian Factory-built Housing		273			248			558			363
Corporate/Other		372			409			734			817
Consolidated depreciation	$	3,264		$	3,048		$	6,521		$	5,969
Amortization of U.S. Factory-built Housing intangible assets:	$	1,874		$	1,360		$	3,762		$	2,721
Capital expenditures:
U.S. Factory-built Housing	$	5,269		$	1,054		$	12,527		$	1,939
Canadian Factory-built Housing		236			85			341			242
Corporate/Other		379			102			2,237			371
Consolidated capital expenditures	$	5,884		$	1,241		$	15,105		$	2,552
(Dollars in thousands)							October 2, 2021			April 3, 2021
Total Assets:
U.S. Factory-built Housing (1)							$	605,669		$	578,897
Canadian Factory-built Housing (1)								93,773			87,224
Corporate/Other (1)								310,888			251,781
Consolidated total assets							$	1,010,330		$	917,902

(1)Deferred tax assets for the Canadian operations are reflected in the Canadian Factory-built Housing segment. U.S. deferred tax assets are presented in Corporate/Other because an allocation between segments is not practicable. 

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Commitments, Contingencies and Legal Proceedings

6 Months Ended

Oct. 02, 2021

Commitments And Contingencies Disclosure [Abstract]

Commitments, Contingencies and Legal Proceedings

13. Commitments, Contingencies and Legal Proceedings

Repurchase Contingencies and Guarantees

The Company is contingently liable under terms of repurchase agreements with lending institutions that provide wholesale floor plan financing to retailers. These arrangements, which are customary in the manufactured housing industry, provide for the repurchase of products sold to retailers in the event of default by the retailer on its agreement to pay the financial institution. The risk of loss from these agreements is spread over numerous retailers. The repurchase price is generally determined by the original sales price of the product less contractually defined curtailment payments. Excluding the resale value of the homes, the contingent repurchase obligation as of October 2, 2021 was estimated to be $243.4 million. The Company accounts for the guarantees under its repurchase agreements with the retailers’ financing institutions by estimating and deferring a portion of the related product sale that represents the estimated fair value of the repurchase obligation. In addition, the Company has estimated the expected contingent net loss the Company will incur upon resale of any repurchases. These estimates are based on recent historical experience supplemented by management’s assessment of current economic and other conditions affecting retailers for which the Company has a contingent repurchase obligation. Based on these repurchase agreements and historical loss experience, as well as current economic conditions and forecasts that affect the potential loss exposure, a loss reserve of $1.5 million and $1.4 million was recorded as of October 2, 2021 and April 3, 2021, respectively. Losses incurred on homes repurchased were not significant during the three or six months ended October 2, 2021 or September 26, 2020.

At October 2, 2021, the Company was contingently obligated for $30.4 million under letters of credit, primarily consisting of $12.6 million to support long-term debt, $17.5 million to support the casualty insurance program, and $0.3 million to support bonding agreements. The letters of credit are issued from a sub-facility of the Amended Credit Agreement. The Company was also contingently obligated for $35.1 million under surety bonds, generally to support performance on long-term construction contracts and license and service bonding requirements.

In the normal course of business, the Company’s former subsidiaries that operated in the United Kingdom historically provided certain guarantees to two customers. Those guarantees provide contractual liability for proven construction defects up to 12 years from the date of delivery of certain products. The guarantees remain a contingent liability of the Company which declines over time through October 2027. As of the date of this report, the Company expects few, if any, claims to be reported under the terms of the guarantees.

Legal Proceedings

The Company has agreed to indemnify counterparties in the ordinary course of its business in agreements to acquire and sell business assets and in financing arrangements. The Company is subject to various legal proceedings and claims that arise in the ordinary course of its business. As of the date of this filing, the Company believes the ultimate liability with respect to these contingent obligations will not have, either individually or in the aggregate, a material adverse effect on the Company’s financial condition, results of operations, or cash flows.

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Basis of Presentation and Business (Policies)

6 Months Ended

Oct. 02, 2021

Accounting Policies [Abstract]

Nature of Operations

Nature of Operations: Skyline Champion Corporation (the “Company”) is a leading producer of factory-built housing in the United States (“U.S.”) and Canada. The Company’s operations consist of manufacturing, retail, and transportation activities. The Company operates 35 manufacturing facilities throughout the U.S. and five manufacturing facilities in western Canada. These facilities primarily construct factory-built, timber-framed manufactured, and modular houses that are sold primarily to independent retailers, builders/developers, and manufactured home community operators. The Company’s retail operations consist of 18 sales centers that sell manufactured houses to consumers primarily in the Southern U.S. The Company’s transportation business engages independent owners/drivers to transport manufactured homes, recreational vehicles and other products throughout the U.S. and Canada.

COVID-19 Government Financial Assistance

COVID-19 Government Financial Assistance: The outbreak of a novel strain of coronavirus ("COVID-19") was declared a global pandemic by the World Health Organization in March 2020. Various government programs were announced to provide financial relief for affected businesses, including the Employee Retention Credit under the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") and state level programs in the United States and the Canada Emergency Wage Subsidy ("CEWS") under the COVID-19 Economic Response Plan in Canada. The Company recognized $0.6 million for wage subsidies under the CARES Act and other state level programs in the United States during the first quarter of fiscal 2021. The Company recognized $2.6 million and $6.2 million of payroll subsidies under CEWS during the three and six months ended September 26, 2020, respectively. The Company’s policy is to account for these subsidies as Other Income in the period in which the related costs are incurred and the Company is reasonably assured to receive payment. In addition, the CARES Act allows for deferring payment of certain payroll taxes. Through October 2, 2021, the Company has deferred $11.8 million of payroll taxes that will be paid beginning in December 2021.

Basis of Presentation

Basis of Presentation: The accompanying unaudited condensed consolidated financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for Quarterly Reports on Form 10-Q and Article 10 of SEC Regulation S-X. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with United States Generally Accepted Accounting Principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations.

The condensed consolidated financial statements include the accounts of the Company and its majority-owned subsidiaries after elimination of intercompany balances and transactions. In the opinion of management, these statements include all normal recurring adjustments necessary to fairly state the Company’s consolidated results of operations, cash flows, and financial position. The Company has evaluated subsequent events after the balance sheet date through the date of the filing of this report with the SEC. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes to the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on May 26, 2021 (the “Fiscal 2021 Annual Report”).

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes thereto. Actual results could differ from those estimates. The condensed consolidated income statements, condensed consolidated statements of comprehensive income, and condensed consolidated statements of cash flows for the interim periods are not necessarily indicative of the results of operations or cash flows for the full year.

The Company’s allowance for credit losses on financial assets measured at amortized cost reflects management’s estimate of credit losses over the remaining expected life of such assets, measured primarily using historical experience, as well as current economic conditions and forecasts that affect the collectability of the reported amount. Expected credit losses for newly recognized financial assets, as well as changes to expected credit losses during the period, are recognized in earnings. Accounts receivable are reflected net of reserves of $0.5 million and $0.4 million at October 2, 2021 and April 3, 2021, respectively. At both October 2, 2021 and April 3, 2021, other notes receivable are reflected net of reserves of $0.4 million.

The Company’s fiscal year is a 52- or 53-week period that ends on the Saturday nearest to March 31. The Company’s current fiscal year, “fiscal 2022,” will end on April 2, 2022 and will include 52 weeks. References to “fiscal 2021” refer to the Company’s fiscal year ended April 3, 2021. The three and six months ended October 2, 2021 and September 26, 2020 each included 13 and 26 weeks, respectively.

There were no accounting standards recently issued that are expected to have a material impact on the Company’s financial position or results of operations. 

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Business Acquisition (Tables)

6 Months Ended

Oct. 02, 2021

Business Combinations [Abstract]

Schedule of Purchase Price Preliminary Allocation on Assets and Liabilities

The preliminary allocation of the purchase price was as follows:
 

(Dollars in thousands)
Cash	$	1,521
Trade accounts receivable		2,256
Inventory		6,752
Property, plant, and equipment		10,466
Other assets		1,164
Accounts payable and accrued liabilities		(7,432	)
Intangibles		21,100
Goodwill		18,449
Total purchase price allocation	$	54,276

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Inventories, Net (Tables)

6 Months Ended

Oct. 02, 2021

Inventory Disclosure [Abstract]

Summary of Components of Inventory, Net of Reserves for Obsolete Inventory

The components of inventory, net of reserves for obsolete inventory, were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Raw materials	$	104,179	$	91,916
Work in process		24,036		21,642
Finished goods and other		51,761		52,555
Total inventories, net	$	179,976	$	166,113

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Property, Plant, and Equipment (Tables)

6 Months Ended

Oct. 02, 2021

Property Plant And Equipment [Abstract]

Summary of Components of Property, Plant, and Equipment

The components of property, plant, and equipment were as follows:

(Dollars in thousands)	October 2, 2021			April 3, 2021
Land and improvements	$	38,966		$	36,470
Buildings and improvements		96,324			97,005
Machinery and equipment		61,384			57,790
Construction in progress		10,591			1,889
Property, plant, and equipment, at cost		207,265			193,154
Less: accumulated depreciation		(84,360	)		(78,014	)
Property, plant, and equipment, net	$	122,905		$	115,140

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Goodwill, Intangible Assets, and Cloud Computing Arrangements (Tables)

6 Months Ended

Oct. 02, 2021

Goodwill And Intangible Assets Disclosure [Abstract]

Components of Amortizable Intangible Assets

The components of amortizable intangible assets were as follows:

(Dollars in thousands)	October 2, 2021									April 3, 2021
	Customer Relationships			Trade Names			Total			Customer Relationships			Trade Names			Total
Gross carrying amount	$	61,923		$	21,393		$	83,316		$	61,963		$	21,409		$	83,372
Accumulated amortization		(20,934	)		(7,309	)		(28,243	)		(18,158	)		(6,379	)	$	(24,537	)
Amortizable intangibles, net	$	40,989		$	14,084		$	55,073		$	43,805		$	15,030		$	58,835

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Other Current Liabilities (Tables)

6 Months Ended

Oct. 02, 2021

Other Liabilities Disclosure [Abstract]

Components of Other Current Liabilities

The components of other current liabilities were as follows:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Customer deposits	$	59,807	$	58,888
Accrued volume rebates		23,048		18,207
Accrued warranty obligations		25,419		24,033
Accrued compensation and payroll taxes		45,484		42,560
Accrued insurance		15,716		12,421
Other		31,273		24,586
Total other current liabilities	$	200,747	$	180,695

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Accrued Warranty Obligations (Tables)

6 Months Ended

Oct. 02, 2021

Guarantees And Product Warranties [Abstract]

Summary of Changes in Accrued Warranty Obligations

Changes in the accrued warranty obligations were as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Balance at beginning of period	$	31,079		$	24,695		$	30,469		$	24,969
Warranty expense		10,880			8,394			21,184			14,753
Cash warranty payments		(10,104	)		(8,629	)		(19,798	)		(15,262	)
Balance at end of period		31,855			24,460			31,855			24,460
Less: noncurrent portion in other long-term liabilities		(6,436	)		(5,790	)		(6,436	)		(5,790	)
Total current portion	$	25,419		$	18,670		$	25,419		$	18,670

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Debt and Floor Plan Payable (Tables)

6 Months Ended

Oct. 02, 2021

Debt Disclosure [Abstract]

Summary of Long Term Debt

Long-term debt consisted of the following:

(Dollars in thousands)	October 2, 2021		April 3, 2021
Revolving credit facility maturing in 2026	$	—	$	26,900
Obligations under industrial revenue bonds due 2029		12,430		12,430
Total debt		12,430		39,330
Less: current portion		—		—
Total long-term debt	$	12,430	$	39,330

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Revenue Recognition (Tables)

6 Months Ended

Oct. 02, 2021

Revenue From Contract With Customer [Abstract]

Summary of Corporate Net Sales

The following tables disaggregate the Company’s revenue by sales category for the three and six months ended October 2, 2021 and September 26, 2020:

	Three months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	469,127	$	38,501	$	—	$	507,628
Commercial		2,572		—		—		2,572
Transportation		—		—		14,025		14,025
Total	$	471,699	$	38,501	$	14,025	$	524,225
	Six months ended October 2, 2021
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	925,018	$	76,332	$	—	$	1,001,350
Commercial		4,001		—		—		4,001
Transportation		—		—		29,071		29,071
Total	$	929,019	$	76,332	$	29,071	$	1,034,422
	Three months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	275,969	$	24,558	$	—	$	300,527
Commercial		7,391		—		—		7,391
Transportation		—		—		14,448		14,448
Total	$	283,360	$	24,558	$	14,448	$	322,366
	Six months ended September 26, 2020
(Dollars in thousands)	U.S. Factory-Built Housing		Canadian Factory-Built Housing		Corporate/ Other		Total
Manufacturing and retail	$	524,828	$	39,753	$	—	$	564,581
Commercial		7,391		—		—		7,391
Transportation		—		—		23,679		23,679
Total	$	532,219	$	39,753	$	23,679	$	595,651

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Earnings Per Share (Tables)

6 Months Ended

Oct. 02, 2021

Earnings Per Share [Abstract]

Computation of Basic and Diluted Earnings per Common Share

The following table sets forth the computation of basic and diluted earnings per common share:

	Three months ended					Six months ended
(Dollars and shares in thousands, except per share data)	October 2, 2021		September 26, 2020				October 2, 2021		September 26, 2020
Numerator:
Net income	$	50,723	$	17,511			$	93,624	$	29,414
Undistributed earnings allocated to participating securities		—		(19	)			—		(53	)
Net income attributable to the Company's common shareholders	$	50,723	$	17,492			$	93,624	$	29,361
Denominator:
Basic weighted-average shares outstanding		56,808		56,654				56,757		56,593
Dilutive securities		400		255				455		238
Diluted weighted-average shares outstanding		57,208		56,909				57,212		56,831
Basic net income per share	$	0.89	$	0.31			$	1.65	$	0.52
Diluted net income per share	$	0.89	$	0.31			$	1.64	$	0.52

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Segment Information (Tables)

6 Months Ended

Oct. 02, 2021

Segment Reporting [Abstract]

Schedule of Financial Information by Reportable Segments

Selected financial information by reportable segment was as follows:

	Three months ended						Six months ended
(Dollars in thousands)	October 2, 2021			September 26, 2020			October 2, 2021			September 26, 2020
Net sales:
U.S. Factory-built Housing	$	471,699		$	283,360		$	929,019		$	532,219
Canadian Factory-built Housing		38,501			24,558			76,332			39,753
Corporate/Other		14,025			14,448			29,071			23,679
Consolidated net sales	$	524,225		$	322,366		$	1,034,422		$	595,651
Operating income:
U.S. Factory-built Housing EBITDA	$	78,075		$	28,697		$	141,092		$	53,090
Canadian Factory-built Housing EBITDA		6,390			5,951			12,056			10,857
Corporate/Other EBITDA		(11,351	)		(6,221	)		(17,328	)		(13,828	)
Other income		11			(2,599	)		(43	)		(6,813	)
Depreciation		(3,264	)		(3,048	)		(6,521	)		(5,969	)
Amortization		(1,874	)		(1,360	)		(3,762	)		(2,721	)
Consolidated operating income	$	67,987		$	21,420		$	125,494		$	34,616
Depreciation:
U.S. Factory-built Housing	$	2,619		$	2,391		$	5,229		$	4,789
Canadian Factory-built Housing		273			248			558			363
Corporate/Other		372			409			734			817
Consolidated depreciation	$	3,264		$	3,048		$	6,521		$	5,969
Amortization of U.S. Factory-built Housing intangible assets:	$	1,874		$	1,360		$	3,762		$	2,721
Capital expenditures:
U.S. Factory-built Housing	$	5,269		$	1,054		$	12,527		$	1,939
Canadian Factory-built Housing		236			85			341			242
Corporate/Other		379			102			2,237			371
Consolidated capital expenditures	$	5,884		$	1,241		$	15,105		$	2,552
(Dollars in thousands)							October 2, 2021			April 3, 2021
Total Assets:
U.S. Factory-built Housing (1)							$	605,669		$	578,897
Canadian Factory-built Housing (1)								93,773			87,224
Corporate/Other (1)								310,888			251,781
Consolidated total assets							$	1,010,330		$	917,902

(1)Deferred tax assets for the Canadian operations are reflected in the Canadian Factory-built Housing segment. U.S. deferred tax assets are presented in Corporate/Other because an allocation between segments is not practicable. 

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Basis of Presentation and Business - Additional information (Detail) $ in Thousands		3 Months Ended	6 Months Ended
	Jun. 27, 2020 USD ($)	Sep. 26, 2020 USD ($)	Oct. 02, 2021 USD ($) Facility Center	Sep. 26, 2020 USD ($)	Apr. 03, 2021 USD ($)
Significant Accounting Policies [Line Items]
Trade accounts receivable, net			$ 72,886		$ 57,481
Accounting Standards Update 2016-13 [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member]
Significant Accounting Policies [Line Items]
Trade accounts receivable, net			500		400
Other notes receivable net of reserves			$ 400		$ 400
U.S [Member]
Significant Accounting Policies [Line Items]
Number of manufacturing facilities | Facility			35
Number of sales centers | Center			18
Canada [Member]
Significant Accounting Policies [Line Items]
Number of manufacturing facilities | Facility			5
COVID-19 [Member]
Significant Accounting Policies [Line Items]
CEWS payroll subsidies recognized		$ 2,600		$ 6,200
CARES act and other state level programs subsidies recognized	$ 600
Deferred payroll taxes paid			$ 11,800

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Business Acquisition - ScotBilt Acquisition - Additional Information (Detail) - USD ($) $ in Thousands		12 Months Ended
	Feb. 28, 2021	Apr. 03, 2021	Oct. 02, 2021
Business Acquisition [Line Items]
Estimated weighted average useful lives		10 years
ScotBilt [Member]
Business Acquisition [Line Items]
Date of acquired	Feb. 28, 2021
Percentage of membership interest	100.00%
Annual revenues	$ 79,000
Purchase price	53,000
Initial total purchase consideration	54,500		$ 54,276
Preliminary purchase price allocation			200
Intangible assets			$ 21,100
ScotBilt [Member] | Level 3 Fair Value Estimates [Member]
Business Acquisition [Line Items]
Property, plant and equipment, fair value		$ 10,500
Intangible assets, fair value		$ 21,100
ScotBilt [Member] | Customer Relationships [Member]
Business Acquisition [Line Items]
Intangible assets	13,000
ScotBilt [Member] | Trade Name [Member]
Business Acquisition [Line Items]
Intangible assets	$ 8,100

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Business Acquisition - Schedule of Purchase Price Preliminary Allocation on Assets and Liabilities (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021	Feb. 28, 2021
Business Acquisition [Line Items]
Goodwill	$ 191,970	$ 191,803
ScotBilt [Member]
Business Acquisition [Line Items]
Cash	1,521
Trade accounts receivable	2,256
Inventory	6,752
Property, plant, and equipment	10,466
Other assets	1,164
Accounts payable and accrued liabilities	(7,432)
Intangibles	21,100
Goodwill	18,449
Total purchase price allocation	$ 54,276		$ 54,500

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Inventories, Net - Summary of Components of Inventory, Net of Reserves for Obsolete Inventory (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 104,179	$ 91,916
Work in process	24,036	21,642
Finished goods and other	51,761	52,555
Total inventories, net	$ 179,976	$ 166,113

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Inventories, Net - Additional Information (Detail) - USD ($) $ in Millions	Oct. 02, 2021	Apr. 03, 2021
Inventory Disclosure [Abstract]
Reserves for obsolete inventory	$ 4.5	$ 4.6

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Property Plant, and Equipment - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Property, Plant and Equipment [Line Items]
Depreciation expense	$ 3,264	$ 3,048	$ 6,521	$ 5,969
Minimum [Member] | Land and Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			3 years
Minimum [Member] | Building and Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			8 years
Minimum [Member] | Vehicles [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			3 years
Minimum [Member] | Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			3 years
Maximum [Member] | Land and Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			10 years
Maximum [Member] | Building and Improvements [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			25 years
Maximum [Member] | Vehicles [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			8 years
Maximum [Member] | Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Estimated useful lives of property, plant and equipment			8 years

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Property Plant, and Equipment - Summary of Components of Property, Plant, and Equipment (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021
Property, Plant and Equipment [Line Items]
Property, plant and equipment, at cost	$ 207,265	$ 193,154
Less accumulated depreciation	(84,360)	(78,014)
Property, plant, and equipment, net	122,905	115,140
Land and Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, at cost	38,966	36,470
Building and Improvements [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, at cost	96,324	97,005
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, at cost	61,384	57,790
Construction in Progress [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, at cost	$ 10,591	$ 1,889

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Goodwill, Intangible Assets, and Cloud Computing Arrangements - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020	Apr. 03, 2021
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill	$ 191,970,000		$ 191,970,000		$ 191,803,000
Amortization of intangible assets	1,900,000	$ 1,300,000	3,762,000	$ 2,721,000
Capitalized cloud computing costs	10,600,000		10,600,000		$ 300,000
Amortization of capitalized cloud computing costs	$ 0	$ 0	$ 0	$ 0

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Goodwill, Intangible Assets, and Cloud Computing Arrangements - Components of Amortizable Intangible Assets (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	$ 83,316	$ 83,372
Accumulated amortization	(28,243)	(24,537)
Amortizable intangibles, net	55,073	58,835
Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	61,923	61,963
Accumulated amortization	(20,934)	(18,158)
Amortizable intangibles, net	40,989	43,805
Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	21,393	21,409
Accumulated amortization	(7,309)	(6,379)
Amortizable intangibles, net	$ 14,084	$ 15,030

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Other Current Liabilities - Components of Other Current Liabilities (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021	Sep. 26, 2020
Other Liabilities Disclosure [Abstract]
Customer deposits	$ 59,807	$ 58,888
Accrued volume rebates	23,048	18,207
Accrued warranty obligations	25,419	24,033	$ 18,670
Accrued compensation and payroll taxes	45,484	42,560
Accrued insurance	15,716	12,421
Other	31,273	24,586
Total other current liabilities	$ 200,747	$ 180,695

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Accrued Warranty Obligations - Summary of Changes in Accrued Warranty Obligations (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020	Apr. 03, 2021
Guarantees And Product Warranties [Abstract]
Balance at beginning of period	$ 31,079	$ 24,695	$ 30,469	$ 24,969
Warranty expense	10,880	8,394	21,184	14,753
Cash warranty payments	(10,104)	(8,629)	(19,798)	(15,262)
Balance at end of period	31,855	24,460	31,855	24,460
Less noncurrent portion in other long-term liabilities	(6,436)	(5,790)	(6,436)	(5,790)
Total current portion	$ 25,419	$ 18,670	$ 25,419	$ 18,670	$ 24,033

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Debt and Floor Plan Payable - Summary of Long Term Debt (Detail) - USD ($) $ in Thousands	Oct. 02, 2021	Apr. 03, 2021
Debt Instrument [Line Items]
Total debt	$ 12,430	$ 39,330
Total long-term debt	12,430	39,330
Revolving Credit Facility Maturing in 2026 [Member]
Debt Instrument [Line Items]
Total debt		26,900
Obligations Under Industrial Revenue Bonds Due 2029 [Member]
Debt Instrument [Line Items]
Total debt	$ 12,430	$ 12,430

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Debt and Floor Plan Payable - Additional Information (Detail)	3 Months Ended	6 Months Ended
	Oct. 02, 2021 USD ($)	Oct. 02, 2021 USD ($)	Sep. 26, 2020 USD ($)	Jul. 07, 2021 USD ($)	Jul. 03, 2021 USD ($)	Apr. 03, 2021 USD ($)
Debt Instrument [Line Items]
Revolving credit facility, maturity month and year		2026-07
Deferred financing fees written off		$ 509,000	$ 253,000
Interest Expense, Net [Member]
Debt Instrument [Line Items]
Deferred financing fees written off	$ 300,000	$ 300,000
Obligations Under Industrial Revenue Bonds Due 2029 [Member]
Debt Instrument [Line Items]
Weighted-average interest rate	1.74%	1.74%
Industrial revenue bonds maturity		2029
Floor Plan Financing Arrangements [Member]
Debt Instrument [Line Items]
Outstanding borrowings	$ 30,800,000	$ 30,800,000				$ 25,700,000
Line of Credit Facility, description		Borrowings are secured by the homes and are required to be repaid when the Company sells the home to a customer.
Credit Agreement [Member] | Other Noncurrent Assets [Member]
Debt Instrument [Line Items]
Deferred financing fees capitalized				$ 1,100,000
Credit Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Revolving credit facility				200,000,000.0	$ 100,000,000.0
First lien leverage ratio	2.25	2.25
Interest rate on borrowings		1.20%
Outstanding borrowings					$ 26,900,000
Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage Ratio Equal to Or Greater Than 2.25:1.00 [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		1.875%
Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage Ratio Equal to Or Greater Than 2.25:1.00 [Member] | Base Rate [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		0.875%
Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage Below 0.50:1.00 [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		1.125%
Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage Below 0.50:1.00 [Member] | Base Rate [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		0.125%
Minimum [Member] | Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage [Member]
Debt Instrument [Line Items]
Unused line fee percentage		0.15%
Maximum [Member] | Floor Plan Financing Arrangements [Member]
Debt Instrument [Line Items]
Revolving credit facility	$ 57,000,000.0	$ 57,000,000.0
Maximum [Member] | Credit Agreement [Member] | Revolving Credit Facility [Member] | Consolidated Total Net Leverage [Member]
Debt Instrument [Line Items]
Unused line fee percentage		0.30%
Letter of Credit [Member] | Credit Agreement [Member]
Debt Instrument [Line Items]
Revolving credit facility				$ 45,000,000.0
Letters of credit issued	30,400,000	$ 30,400,000
Available borrowings under Credit Agreement	$ 169,600,000	$ 169,600,000

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Revenue Recognition - Summary of Corporate Net Sales (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	$ 524,225	$ 322,366	$ 1,034,422	$ 595,651
Manufacturing and Retail [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	507,628	300,527	1,001,350	564,581
Commercial [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	2,572	7,391	4,001	7,391
Transportation [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	14,025	14,448	29,071	23,679
U.S Factory-Built Housing [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	471,699	283,360	929,019	532,219
U.S Factory-Built Housing [Member] | Manufacturing and Retail [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	469,127	275,969	925,018	524,828
U.S Factory-Built Housing [Member] | Commercial [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	2,572	7,391	4,001	7,391
Canadian Factory-Built Housing [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	38,501	24,558	76,332	39,753
Canadian Factory-Built Housing [Member] | Manufacturing and Retail [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	38,501	24,558	76,332	39,753
Corporate Other [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	14,025	14,448	29,071	23,679
Corporate Other [Member] | Transportation [Member]
Disaggregation of Revenue [Line Items]
Consolidated Net Sales	$ 14,025	$ 14,448	$ 29,071	$ 23,679

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Income Taxes - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Income Tax Contingency [Line Items]
Income tax expense	$ 16,408,000	$ 5,644,000	$ 30,419,000	$ 10,209,000
Effective tax rate	24.40%	24.40%	24.50%	25.80%
Statutory federal income tax rate	21.00%	21.00%	21.00%	21.00%
Unrecognized tax benefits	$ 0		$ 0

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Earnings Per Share - Computation of Basic and Diluted Earnings Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020
Numerator:
Net income (loss)	$ 50,723	$ 17,511	$ 93,624	$ 29,414
Undistributed earnings allocated to participating securities		(19)		(53)
Net income attributable to the Company's common shareholders	$ 50,723	$ 17,492	$ 93,624	$ 29,361
Denominator:
Basic weighted average shares outstanding	56,808	56,654	56,757	56,593
Dilutive securities	400	255	455	238
Diluted weighted average shares outstanding	57,208	56,909	57,212	56,831
Basic net income per share	$ 0.89	$ 0.31	$ 1.65	$ 0.52
Diluted net income per share	$ 0.89	$ 0.31	$ 1.64	$ 0.52

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Segment Information - Additional Information (Detail)	6 Months Ended
	Oct. 02, 2021 Segment
Segment Reporting [Abstract]
Number of reportable segments	2

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Segment Information - Schedule of Financial Information by Reportable Segments (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Oct. 02, 2021	Sep. 26, 2020	Oct. 02, 2021	Sep. 26, 2020	Apr. 03, 2021
Segment Reporting Information [Line Items]
Net sales	$ 524,225	$ 322,366	$ 1,034,422	$ 595,651
Operating income (loss)	67,987	21,420	125,494	34,616
Other income	11	(2,599)	(43)	(6,813)
Depreciation	3,264	3,048	6,521	5,969
Amortization	(1,874)	(1,360)	(3,762)	(2,721)
Amortization of intangible assets	1,900	1,300	3,762	2,721
Assets	1,010,330		1,010,330		$ 917,902
U.S Factory-Built Housing [Member]
Segment Reporting Information [Line Items]
Net sales	471,699	283,360	929,019	532,219
Amortization of intangible assets	1,874	1,360	3,762	2,721
Canadian Factory-Built Housing [Member]
Segment Reporting Information [Line Items]
Net sales	38,501	24,558	76,332	39,753
Operating Segments [Member] | U.S Factory-Built Housing [Member]
Segment Reporting Information [Line Items]
Net sales	471,699	283,360	929,019	532,219
Operating income (loss)	78,075	28,697	141,092	53,090
Depreciation	2,619	2,391	5,229	4,789
Capital expenditures	5,269	1,054	12,527	1,939
Assets	605,669		605,669		578,897
Operating Segments [Member] | Canadian Factory-Built Housing [Member]
Segment Reporting Information [Line Items]
Net sales	38,501	24,558	76,332	39,753
Operating income (loss)	6,390	5,951	12,056	10,857
Depreciation	273	248	558	363
Capital expenditures	236	85	341	242
Assets	93,773		93,773		87,224
Corporate, Non-Segment [Member]
Segment Reporting Information [Line Items]
Net sales	14,025	14,448	29,071	23,679
Operating income (loss)	(11,351)	(6,221)	(17,328)	(13,828)
Depreciation	372	409	734	817
Capital expenditures	379	102	2,237	371
Assets	310,888		310,888		251,781
Segment Reconciling Items [Member]
Segment Reporting Information [Line Items]
Net sales	524,225	322,366	1,034,422	595,651
Operating income (loss)	67,987	21,420	125,494	34,616
Depreciation	3,264	3,048	6,521	5,969
Capital expenditures	5,884	$ 1,241	15,105	$ 2,552
Assets	$ 1,010,330		$ 1,010,330		$ 917,902

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Commitments, Contingencies and Legal Proceedings - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended
	Oct. 02, 2021	Apr. 03, 2021
Commitment And Contingencies [Line Items]
Losses under repurchase obligations	$ 243.4
Reserve for estimated losses under repurchase agreements	$ 1.5	$ 1.4
Guarantee obligations term	12 years
Letters of Credit [Member]
Commitment And Contingencies [Line Items]
Contingent obligation	$ 30.4
Long-term Debt [Member]
Commitment And Contingencies [Line Items]
Contingent obligation	12.6
Casualty Insurance Program [Member]
Commitment And Contingencies [Line Items]
Contingent obligation	17.5
Bonding Agreements [Member]
Commitment And Contingencies [Line Items]
Contingent obligation	0.3
Surety Bond [Member]
Commitment And Contingencies [Line Items]
Contingent obligation	$ 35.1