FOR QUARTER ENDED April 30, 2007
|
COMMISSION FILE NUMBER 1-9235 |
Delaware | 93-0768752 | |
(State or other jurisdiction of | (I.R.S. Employer | |
incorporation or organization) | Identification No.) | |
419 West Pike Street, Jackson Center, OH | 45334-0629 | |
(Address of principal executive offices) | (Zip Code) |
Class | Outstanding at 5/31/2007 | |
Common stock, par value | 55,767,304 shares | |
$.10 per share |
1
2
April 30, 2007 | July 31, 2006 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 146,982 | $ | 196,136 | ||||
Investments short term |
105,590 | 68,237 | ||||||
Accounts receivable: |
||||||||
Trade |
213,081 | 188,104 | ||||||
Other |
8,013 | 5,639 | ||||||
Inventories |
202,725 | 183,169 | ||||||
Prepaid expenses |
9,850 | 6,533 | ||||||
Deferred income taxes |
25,367 | 4,898 | ||||||
Total current assets |
711,608 | 652,716 | ||||||
Property: |
||||||||
Land |
21,741 | 21,323 | ||||||
Buildings and improvements |
134,290 | 131,649 | ||||||
Machinery and equipment |
60,660 | 55,656 | ||||||
Total cost |
216,691 | 208,628 | ||||||
Accumulated depreciation |
60,135 | 51,163 | ||||||
Property, net |
156,556 | 157,465 | ||||||
Investment in joint ventures |
2,696 | 2,737 | ||||||
Other assets: |
||||||||
Goodwill |
165,663 | 165,663 | ||||||
Non-compete agreements |
2,171 | 2,841 | ||||||
Trademarks |
13,900 | 13,900 | ||||||
Other |
12,216 | 9,403 | ||||||
Total other assets |
193,950 | 191,807 | ||||||
TOTAL ASSETS |
$ | 1,064,810 | $ | 1,004,725 | ||||
LIABILITIES AND STOCKHOLDERS EQUITY |
||||||||
Current liabilities: |
||||||||
Accounts payable |
$ | 148,103 | $ | 145,609 | ||||
Accrued liabilities: |
||||||||
Taxes |
45,236 | 18,709 | ||||||
Compensation and related items |
38,686 | 37,161 | ||||||
Product warranties |
60,724 | 59,795 | ||||||
Promotions and rebates |
13,429 | 12,953 | ||||||
Product/property liability and related liabilities |
12,779 | 10,423 | ||||||
Other |
11,745 | 7,315 | ||||||
Total current liabilities |
330,702 | 291,965 | ||||||
Deferred income taxes and other liabilities |
15,948 | 12,911 | ||||||
Contingent liabilities and commitments |
| | ||||||
Stockholders equity: |
||||||||
Common stock authorized 250,000,000 shares;
issued 57,210,404 shares @ 4/30/07 and 57,100,286
shares @ 7/31/06; par value of $.10 per share |
5,721 | 5,710 | ||||||
Additional paid-in capital |
89,133 | 86,538 | ||||||
Accumulated other comprehensive income |
2,109 | 1,772 | ||||||
Retained earnings |
681,320 | 664,322 | ||||||
Less Treasury shares of 1,441,600 @ 4/30/07 & 1,401,200 @
7/31/06 |
(60,123 | ) | (58,493 | ) | ||||
Total stockholders equity |
718,160 | 699,849 | ||||||
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY |
$ | 1,064,810 | $ | 1,004,725 | ||||
3
Three Months Ended April 30 | Nine Months Ended April 30 | |||||||||||||||
2007 | 2006 | 2007 | 2006 | |||||||||||||
(As restated, | (As restated, | |||||||||||||||
see Note 2) | see Note 2) | |||||||||||||||
Net sales |
$ | 789,643 | $ | 857,615 | $ | 2,101,408 | $ | 2,260,985 | ||||||||
Cost of products sold |
686,663 | 733,506 | 1,848,091 | 1,941,529 | ||||||||||||
Gross profit |
102,980 | 124,109 | 253,317 | 319,456 | ||||||||||||
Selling, general and
administrative expenses |
51,834 | 50,317 | 132,703 | 135,890 | ||||||||||||
Interest income |
2,515 | 2,552 | 7,771 | 6,270 | ||||||||||||
Interest expense |
212 | 347 | 563 | 917 | ||||||||||||
Other income |
510 | 243 | 1,375 | 1,169 | ||||||||||||
Income before income taxes |
53,959 | 76,240 | 129,197 | 190,088 | ||||||||||||
Provision for income taxes |
18,390 | 27,571 | 44,779 | 70,141 | ||||||||||||
Net income |
$ | 35,569 | $ | 48,669 | $ | 84,418 | $ | 119,947 | ||||||||
Average common shares outstanding: |
||||||||||||||||
Basic |
55,696,304 | 56,656,684 | 55,654,327 | 56,605,615 | ||||||||||||
Diluted |
55,935,718 | 57,087,096 | 55,916,602 | 56,994,628 | ||||||||||||
Earnings per common share: |
||||||||||||||||
Basic |
$ | .64 | $ | .86 | $ | 1.52 | $ | 2.12 | ||||||||
Diluted |
$ | .64 | $ | .85 | $ | 1.51 | $ | 2.10 | ||||||||
Regular dividends declared per common share: |
$ | .07 | $ | .07 | $ | .21 | $ | .12 | ||||||||
Special dividends declared per common share: |
$ | | $ | | $ | 1.00 | $ | | ||||||||
Regular dividends paid per common share: |
$ | .07 | $ | .07 | $ | .21 | $ | .17 | ||||||||
Special dividends paid per common share: |
$ | | $ | | $ | 1.00 | $ | .25 |
4
2007 | 2006 | |||||||
(As restated, | ||||||||
see Note 2) | ||||||||
Cash flows from operating activities: |
||||||||
Net income |
$ | 84,418 | $ | 119,947 | ||||
Adjustments to reconcile net income to net cash (used in)
provided by operating activities: |
||||||||
Depreciation |
9,687 | 10,023 | ||||||
Amortization |
670 | 712 | ||||||
Deferred income taxes |
(20,604 | ) | (18,149 | ) | ||||
Loss on disposition of assets |
85 | (11 | ) | |||||
Loss on disposition of trading investments |
104 | 403 | ||||||
Unrealized loss on trading investments |
| (461 | ) | |||||
Stock based compensation |
455 | 791 | ||||||
Changes in non cash assets and liabilities, net of effect
from acquisitions: |
||||||||
Purchases of trading investments |
| (197,462 | ) | |||||
Proceeds from disposition of trading investments |
68,133 | 117,726 | ||||||
Accounts receivable |
(27,351 | ) | (74,934 | ) | ||||
Inventories |
(19,556 | ) | (37,787 | ) | ||||
Prepaids and other |
(6,521 | ) | (4,427 | ) | ||||
Accounts payable |
2,303 | 43,670 | ||||||
Accrued liabilities |
36,243 | 54,697 | ||||||
Other liabilities |
2,869 | 2,142 | ||||||
Net cash provided by operating activities |
130,935 | 16,880 | ||||||
Cash flows from investing activities: |
||||||||
Purchase of property, plant & equipment |
(8,885 | ) | (18,263 | ) | ||||
Proceeds from disposition of assets |
230 | 229 | ||||||
Purchase of available for sale investments |
(205,020 | ) | | |||||
Proceeds from sale of available for sale investments |
100,148 | | ||||||
Net cash used in investing activities |
(113,527 | ) | (18,034 | ) | ||||
Cash flows from financing activities: |
||||||||
Cash dividends |
(67,420 | ) | (23,807 | ) | ||||
Purchase of common stock held as treasury shares |
(1,630 | ) | | |||||
Proceeds from issuance of common stock |
2,151 | 1,863 | ||||||
Net cash used in financing activities |
(66,899 | ) | (21,944 | ) | ||||
Effect of exchange rate changes on cash |
337 | 996 | ||||||
Net decrease in cash and equivalents |
(49,154 | ) | (22,102 | ) | ||||
Cash and equivalents, beginning of period |
196,136 | 163,596 | ||||||
Cash and equivalents, end of period |
$ | 146,982 | $ | 141,494 | ||||
Supplemental cash flow information: |
||||||||
Income taxes paid |
$ | 36,552 | $ | 52,057 | ||||
Interest paid |
563 | 917 | ||||||
Non cash transactions: |
||||||||
Capital expenditures in accounts payable |
$ | 191 | $ | 1,406 | ||||
Purchase of treasury shares |
| 5,102 | ||||||
Incentive stock options disqualifying disposition |
| 339 | ||||||
Cancellation of restricted stock |
35 | 42 |
5
1. | The July 31, 2006 amounts are derived from the annual audited financial statements, as restated. The interim financial statements are unaudited. In the opinion of management, all adjustments (which consist of normal recurring adjustments) necessary to present fairly the financial position, results of operations and change in cash flows for the interim periods presented have been made. These financial statements should be read in conjunction with the Companys Annual Report on Form 10-K/A for the year ended July 31, 2006. The results of operations for the nine months ended April 30, 2007 are not necessarily indicative of the results for the full year. | |
2. | Restatement of Financial Statements | |
On January 29, 2007, we announced that the Audit Committee of our Board of Directors (the Audit Committee) initiated an independent investigation regarding certain accounting issues at our Dutchmen Manufacturing, Inc. operating subsidiary (Dutchmen). The Vice President of Finance at Dutchmen was intentionally understating the cost of products sold during the periods restated, primarily by overstating inventory and accounts receivable and understating accounts payable. We promptly and voluntarily informed the SEC of the Audit Committees investigation, and have been responding to SEC staff requests for additional information in connection with the staffs investigation. The Audit Committee, assisted by independent outside legal counsel and accounting experts, thoroughly investigated the accounting issues raised at Dutchmen. The Audit Committee and its advisors also reviewed the internal controls at Dutchmen and other subsidiaries. | ||
The Audit Committees investigation confirmed the Companys determination that the income before income taxes recorded by Dutchmen was overstated during the periods that we subsequently restated, as a result of misconduct by Dutchmens former Vice President of Finance, the senior financial officer of Dutchmen. | ||
The Company has restated its previously issued financial statements as of July 31, 2006, in conjunction with the Companys Annual Report on Form 10-K/A, and for the three and nine month periods ended April 30, 2006. The restatement followed the Companys evaluation, considering the results from the Audit Committees investigation, of accounting practices employed at Dutchmen during these periods. | ||
The following tables show the previously reported, restatement adjustment and restated amounts for those accounts in the Statements of Condensed Consolidated Income for the three months ended April 30, 2006 and the nine months ended April 30, 2006 and the Statement of Condensed Consolidated Cash Flows for the nine months ended April 30, 2006, affected by the restatements. |
Previously | Restatement | |||||||||||
reported | adjustment | Restated | ||||||||||
Statement of Condensed Consolidated Income |
||||||||||||
Three months ended April 30, 2006 |
||||||||||||
Cost of products sold |
$ | 729,604 | $ | 3,902 | $ | 733,506 | ||||||
Gross profit |
128,011 | (3,902 | ) | 124,109 | ||||||||
Income before income taxes |
80,142 | (3,902 | ) | 76,240 | ||||||||
Provision for income taxes |
29,003 | (1,432 | ) | 27,571 | ||||||||
Net income |
51,139 | (2,470 | ) | 48,669 | ||||||||
Earnings per common share |
||||||||||||
Three months ended April 30, 2006 |
||||||||||||
Basic |
$ | .90 | $ | (.04 | ) | $ | .86 | |||||
Diluted |
$ | .90 | $ | (.05 | ) | $ | .85 | |||||
Statement of Condensed Consolidated Income |
||||||||||||
Nine months ended April 30, 2006 |
6
Previously | Restatement | |||||||||||
reported | adjustment | Restated | ||||||||||
Cost of products sold |
$ | 1,931,369 | $ | 10,160 | $ | 1,941,529 | ||||||
Gross profit |
329,616 | (10,160 | ) | 319,456 | ||||||||
Income before income taxes |
200,248 | (10,160 | ) | 190,088 | ||||||||
Provision for income taxes |
73,870 | (3,729 | ) | 70,141 | ||||||||
Net income |
126,378 | (6,431 | ) | 119,947 | ||||||||
Earnings per common share |
||||||||||||
Nine months ended April 30, 2006 |
||||||||||||
Basic |
$ | 2.23 | $ | (.11 | ) | $ | 2.12 | |||||
Diluted |
$ | 2.22 | $ | (.12 | ) | $ | 2.10 | |||||
Statement of Condensed Consolidated Cash Flows |
||||||||||||
Nine months ended April 30, 2006 |
||||||||||||
Cash flows from operating activities |
||||||||||||
Net income |
$ | 126,378 | $ | (6,431 | ) | $ | 119,947 | |||||
Accounts receivable |
(77,568 | ) | 2,634 | (74,934 | ) | |||||||
Inventories |
(38,389 | ) | 602 | (37,787 | ) | |||||||
Accounts payable |
36,747 | 6,923 | 43,670 | |||||||||
Accrued liabilities |
58,425 | (3,728 | ) | 54,697 |
3. | Major classifications of inventories are: |
April 30, 2007 | July 31, 2006 | |||||||
Raw materials |
$ | 97,791 | $ | 99,807 | ||||
Chassis |
53,051 | 39,772 | ||||||
Work in process |
56,009 | 51,208 | ||||||
Finished goods |
22,071 | 13,416 | ||||||
Total |
228,922 | 204,203 | ||||||
Less excess of FIFO costs
over LIFO costs |
26,197 | 21,034 | ||||||
Total inventories |
$ | 202,725 | $ | 183,169 | ||||
4. | Earnings Per Share |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Weighted average shares
outstanding for basic
earnings per share |
55,696,304 | 56,656,684 | 55,654,327 | 56,605,615 | ||||||||||||
Stock options and
restricted stock |
239,414 | 430,412 | 262,275 | 389,013 | ||||||||||||
Total For diluted shares |
55,935,718 | 57,087,096 | 55,916,602 | 56,994,628 | ||||||||||||
7
5. | Comprehensive Income |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Net income |
$ | 35,569 | $ | 48,669 | $ | 84,418 | 119,947 | |||||||||
Foreign currency
translation adjustment |
798 | 156 | 337 | 996 | ||||||||||||
Comprehensive income |
$ | 36,367 | $ | 48,825 | $ | 84,755 | $ | 120,943 | ||||||||
6. | Segment Information | |
The Company has three reportable segments: 1.) towable recreation vehicles, 2.) motorized recreation vehicles, and 3.) buses. The towable recreation vehicle segment consists of product lines from the following operating companies that have been aggregated: Airstream, Breckenridge, CrossRoads, Dutchmen, General Coach Hensall and Oliver, Keystone, Komfort, and Thor California. The motorized recreation vehicle segment consists of product lines from the following operating companies that have been aggregated: Airstream, Damon, Four Winds and Oliver. The bus segment consists of the following operating companies that have been aggregated: Champion Bus, ElDorado California, ElDorado Kansas and Goshen Coach. During the quarter ended January 31, 2006, the Company made the decision not to produce a planned motorized product line. The impairment charge associated with the decision was $1,360 and is included in cost of products sold. |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Net Sales: |
||||||||||||||||
Recreation vehicles: |
||||||||||||||||
Towables |
$ | 524,041 | $ | 615,043 | $ | 1,397,936 | $ | 1,606,140 | ||||||||
Motorized |
159,642 | 161,593 | 412,259 | 424,528 | ||||||||||||
Total recreation vehicles |
683,683 | 776,636 | 1,810,195 | 2,030,668 | ||||||||||||
Buses |
105,960 | 80,979 | 291,213 | 230,317 | ||||||||||||
Total |
$ | 789,643 | $ | 857,615 | $ | 2,101,408 | $ | 2,260,985 | ||||||||
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Income Before Income Taxes: |
||||||||||||||||
Recreation vehicles: |
||||||||||||||||
Towables |
$ | 48,086 | $ | 67,986 | $ | 110,290 | $ | 173,154 | ||||||||
Motorized |
7,220 | 7,756 | 16,756 | 18,293 | ||||||||||||
Total recreation vehicles |
55,306 | 75,742 | 127,046 | 191,447 | ||||||||||||
Buses |
5,447 | 2,034 | 11,622 | 6,013 | ||||||||||||
Corporate |
(6,794 | ) | (1,536 | ) | (9,471 | ) | (7,372 | ) | ||||||||
Total |
$ | 53,959 | $ | 76,240 | $ | 129,197 | $ | 190,088 | ||||||||
8
April 30, 2007 | July 31, 2006 | |||||||
Identifiable Assets: |
||||||||
Recreation vehicles: |
||||||||
Towables |
$ | 495,900 | $ | 483,324 | ||||
Motorized |
177,404 | 150,058 | ||||||
Total recreation vehicles |
673,304 | 633,382 | ||||||
Buses |
104,659 | 103,861 | ||||||
Corporate |
286,847 | 267,482 | ||||||
Total |
$ | 1,064,810 | $ | 1,004,725 | ||||
7. | Treasury Shares | |
In the first quarter of fiscal 2007, the Company purchased 40,400 shares and held them as treasury stock at a cost of $1,630, an average cost of $40.33 per share. | ||
8. | Investments Short Term | |
Effective August 1, 2006, the Company began classifying all short term investment purchases as available-for-sale. This change was based on the Companys decision to change its investment strategy from one of generating profits on short term differences in price to one of preserving capital. | ||
At April 30, 2007, all investments short term are comprised of auction rate securities that are classified as available-for-sale and are reported at fair value in accordance with SFAS No. 115, Accounting for Certain Investments in Debt and Equity Securities. The Company purchases its auction rate securities at par, which either mature or reset at par, and generally there are no unrealized or realized gains or losses to report. Cost is determined on the specific identification basis. Interest income is accrued as earned. All of the available-for-sale securities held at April 30, 2007 mature within one year. | ||
As of July 31, 2006, the Company held short-term debt and equity investments classified as trading securities. These trading securities were all sold or matured during the three months ended October 31, 2006 and were recorded as trading securities activity. Realized and unrealized gains and losses on trading securities are included in earnings. Dividend and interest income were recognized when earned. | ||
9. | Goodwill and Other Intangible Assets | |
The components of other intangible assets are as follows: |
April 30, 2007 | July 31, 2006 | |||||||||||||||
Accumulated | Accumulated | |||||||||||||||
Cost | Amortization | Cost | Amortization | |||||||||||||
Amortized Intangible Assets: |
||||||||||||||||
Non-compete agreements |
$ | 15,889 | $ | 13,718 | $ | 15,889 | $ | 13,048 |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Non-compete Agreements: |
||||||||||||||||
Amortization Expense |
$ | 216 | $ | 237 | $ | 670 | $ | 712 |
Non-compete agreements are amortized on a straight-line basis. |
9
Amortization Expense: |
For the year ending July 2007 |
$ | 887 | ||
For the year ending July 2008 |
$ | 828 | ||
For the year ending July 2009 |
$ | 492 | ||
For the year ending July 2010 |
$ | 337 | ||
For the year ending July 2011 |
$ | 239 |
There was no change in the carrying amount of goodwill and trademarks for the nine month period ended April 30, 2007. | ||
As of April 30, 2007, Goodwill and Trademarks by segments totaled as follows: |
Goodwill | Trademarks | |||||||
Recreation Vehicles: |
||||||||
Towables |
$ | 143,795 | $ | 10,237 | ||||
Motorized |
17,252 | 2,600 | ||||||
Total Recreation Vehicles |
161,047 | 12,837 | ||||||
Bus |
4,616 | 1,063 | ||||||
Total |
$ | 165,663 | $ | 13,900 | ||||
10. | Warranty | |
Thor provides customers of our products with a warranty covering defects in material or workmanship for periods generally ranging from one to two years, with longer warranties on certain structural components. We record a liability based on our best estimate of the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. Factors we use in estimating the warranty liability include a history of units sold, existing dealer inventory, average cost incurred and a profile of the distribution of warranty expenditures over the warranty period. A significant increase in dealer shop rates, the cost of parts or the frequency of claims could have a material adverse impact on our operating results for the period or periods in which such claims or additional costs materialize. Management believes that the warranty reserve is adequate; however, actual claims incurred could differ from estimates, requiring adjustments to the reserves. Warranty reserves are reviewed and adjusted as necessary on a quarterly basis. |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Beginning Balance |
$ | 59,061 | $ | 53,882 | $ | 59,795 | $ | 55,118 | ||||||||
Provision |
17,049 | 17,428 | 50,243 | 45,281 | ||||||||||||
Payments |
15,386 | 14,470 | 49,314 | 43,559 | ||||||||||||
Ending Balance |
$ | 60,724 | $ | 56,840 | $ | 60,724 | $ | 56,840 | ||||||||
11. | Commercial Commitments | |
Our principal commercial commitments at April 30, 2007 are summarized in the following chart: |
Total | Term of | |||||
Commitment | Amount Committed | Guarantee | ||||
Guarantee on dealer financing |
$ | 2,972 | less than 1 year | |||
Standby repurchase obligation
on dealer financing |
$ | 956,975 | less than 1 year |
10
The Company records repurchase and guarantee reserves based on prior experience and known current events. The combined repurchase and recourse reserve balances are approximately $2,212 and $1,563 as of April 30, 2007 and July 31, 2006, respectively. |
Three Months | Three Months | Nine Months | Nine Months | |||||||||||||
Ended | Ended | Ended | Ended | |||||||||||||
April 30, 2007 | April 30, 2006 | April 30, 2007 | April 30, 2006 | |||||||||||||
Cost of units repurchased |
$ | 2,313 | $ | 881 | $ | 10,402 | $ | 2,984 | ||||||||
Realization on units resold |
2,245 | 749 | 9,262 | 2,555 | ||||||||||||
Losses due to repurchase |
$ | 68 | $ | 132 | $ | 1,140 | $ | 429 | ||||||||
12. | Provision for Income Taxes |
In April 2007, the Company reached an agreement in principle to settle a tax dispute with the State of Indiana regarding filing positions taken on its Indiana state income tax returns. It is anticipated that when the agreement is finalized, tax reserves of approximately $6,000 will be reversed by the Company, decreasing the provision for income taxes. |
11
12
13
Three Months Ended | Three Months Ended | Change | ||||||||||||||
April 30, 2007 | April 30, 2006 | Amount | % | |||||||||||||
NET SALES: |
||||||||||||||||
Recreation Vehicles |
||||||||||||||||
Towables |
$ | 524,041 | $ | 615,043 | $ | (91,002 | ) | (14.8 | ) | |||||||
Motorized |
159,642 | 161,593 | (1,951 | ) | (1.2 | ) | ||||||||||
Total Recreation Vehicles |
683,683 | 776,636 | (92,953 | ) | (12.0 | ) | ||||||||||
Buses |
105,960 | 80,979 | 24,981 | 30.8 | ||||||||||||
Total |
$ | 789,643 | $ | 857,615 | $ | (67,972 | ) | (7.9 | ) | |||||||
# OF UNITS: |
||||||||||||||||
Recreation Vehicles |
||||||||||||||||
Towables |
24,530 | 31,729 | (7,199 | ) | (22.7 | ) | ||||||||||
Motorized |
2,153 | 2,190 | (37 | ) | (1.7 | ) | ||||||||||
Total Recreation Vehicles |
26,683 | 33,919 | (7,236 | ) | (21.3 | ) | ||||||||||
Buses |
1,737 | 1,438 | 299 | 20.8 | ||||||||||||
Total |
28,420 | 35,357 | (6,937 | ) | (19.6 | ) | ||||||||||
% of | % of | |||||||||||||||||||||||
Segment | Segment | |||||||||||||||||||||||
Net Sales | Net Sales | |||||||||||||||||||||||
GROSS PROFIT: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 77,258 | 14.7 | $ | 101,841 | 16.6 | $ | (24,583 | ) | (24.1 | ) | |||||||||||||
Motorized |
16,395 | 10.3 | 15,830 | 9.8 | 565 | 3.6 | ||||||||||||||||||
Total Recreation Vehicles |
93,653 | 13.7 | 117,671 | 15.2 | (24,018 | ) | (20.4 | ) | ||||||||||||||||
Buses |
9,327 | 8.8 | 6,438 | 8.0 | 2,889 | 44.9 | ||||||||||||||||||
Total |
$ | 102,980 | 13.0 | $ | 124,109 | 14.5 | $ | (21,129 | ) | (17.0 | ) | |||||||||||||
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 29,275 | 5.6 | $ | 33,914 | 5.5 | $ | (4,639 | ) | (13.7 | ) | |||||||||||||
Motorized |
9,175 | 5.7 | 8,074 | 5.0 | 1,101 | 13.7 | ||||||||||||||||||
Total Recreation Vehicles |
38,450 | 5.6 | 41,988 | 5.4 | (3,538 | ) | (8.4 | ) | ||||||||||||||||
Buses |
3,655 | 3.4 | 4,092 | 5.1 | (437 | ) | (10.7 | ) | ||||||||||||||||
Corporate |
9,729 | | 4,237 | | 5,492 | 129.6 | ||||||||||||||||||
Total |
$ | 51,834 | 6.6 | $ | 50,317 | 5.9 | $ | 1,517 | 3.0 | |||||||||||||||
INCOME BEFORE INCOME TAXES: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 48,086 | 9.2 | $ | 67,986 | 11.1 | $ | (19,900 | ) | (29.3 | ) | |||||||||||||
Motorized |
7,220 | 4.5 | 7,756 | 4.8 | (536 | ) | (6.9 | ) | ||||||||||||||||
Total Recreation Vehicles |
55,306 | 8.1 | 75,742 | 9.8 | (20,436 | ) | (26.9 | ) | ||||||||||||||||
Buses |
5,447 | 5.1 | 2,034 | 2.5 | 3,413 | 167.8 | ||||||||||||||||||
Corporate |
(6,794 | ) | | (1,536 | ) | | (5,258 | ) | (342.4 | ) | ||||||||||||||
Total |
$ | 53,959 | 6.8 | $ | 76,240 | 8.9 | $ | (22,281 | ) | (29.2 | ) | |||||||||||||
As of | As of | Change | ||||||||||||||
April 30, 2007 | April 30, 2006 | Amount | % | |||||||||||||
ORDER BACKLOG |
||||||||||||||||
Recreation Vehicles |
||||||||||||||||
Towables |
$ | 266,448 | $ | 369,034 | $ | (102,586 | ) | (27.8 | ) | |||||||
Motorized |
111,339 | 132,109 | (20,770 | ) | (15.7 | ) | ||||||||||
Total Recreation Vehicles |
377,787 | 501,143 | (123,356 | ) | (24.6 | ) | ||||||||||
Buses |
214,755 | 196,687 | 18,068 | 9.2 | ||||||||||||
Total |
$ | 592,542 | $ | 697,830 | $ | (105,288 | ) | (15.1 | ) | |||||||
14
Average Price | ||||||||||||
Per Unit | Units | Net Change | ||||||||||
Recreation Vehicles |
||||||||||||
Towables |
7.9 | % | (22.7 | )% | (14.8 | )% | ||||||
Motorized |
.5 | % | (1.7 | )% | (1.2 | )% |
15
Average Price Per Unit | Units | Net Change | ||||||||||
Buses |
10.0 | % | 20.8 | % | 30.8 | % |
Nine Months Ended | Nine Months Ended | Change | ||||||||||||||
April 30, 2007 | April 30, 2006 | Amount | % | |||||||||||||
NET SALES: |
||||||||||||||||
Recreation Vehicles |
||||||||||||||||
Towables |
$ | 1,397,936 | $ | 1,606,140 | $ | (208,204 | ) | (13.0 | ) | |||||||
Motorized |
412,259 | 424,528 | (12,269 | ) | (2.9 | ) | ||||||||||
Total Recreation Vehicles |
1,810,195 | 2,030,668 | (220,473 | ) | (10.9 | ) | ||||||||||
Buses |
291,213 | 230,317 | 60,896 | 26.4 | ||||||||||||
Total |
$ | 2,101,408 | $ | 2,260,985 | $ | (159,577 | ) | (7.1 | ) | |||||||
16
Nine Months Ended | Nine Months Ended | Change | ||||||||||||||
April 30, 2007 | April 30, 2006 | Amount | % | |||||||||||||
# OF UNITS: |
||||||||||||||||
Recreation Vehicles |
||||||||||||||||
Towables |
65,456 | 83,289 | (17,833 | ) | (21.4 | ) | ||||||||||
Motorized |
5,529 | 5,695 | (166 | ) | (2.9 | ) | ||||||||||
Total Recreation Vehicles |
70,985 | 88,984 | (17,999 | ) | (20.0 | ) | ||||||||||
Buses |
4,825 | 4,227 | 598 | 14.2 | ||||||||||||
Total |
75,810 | 93,211 | (17,401 | ) | (18.7 | ) | ||||||||||
% of | % of | |||||||||||||||||||||||
Segment | Segment | |||||||||||||||||||||||
Net Sales | Net Sales | |||||||||||||||||||||||
GROSS PROFIT: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 191,656 | 13.7 | $ | 263,105 | 16.4 | (71,449 | ) | (27.2 | ) | ||||||||||||||
Motorized |
38,888 | 9.4 | 39,007 | 9.2 | (119 | ) | (.3 | ) | ||||||||||||||||
Total Recreation Vehicles |
230,544 | 12.7 | 302,112 | 14.9 | (71,568 | ) | (23.7 | ) | ||||||||||||||||
Buses |
22,773 | 7.8 | 17,344 | 7.5 | 5,429 | 31.3 | ||||||||||||||||||
Total |
$ | 253,317 | 12.1 | $ | 319,456 | 14.1 | (66,139 | ) | (20.7 | ) | ||||||||||||||
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 81,659 | 5.8 | $ | 90,167 | 5.6 | $ | (8,508 | ) | (9.4 | ) | |||||||||||||
Motorized |
22,118 | 5.4 | 20,711 | 4.9 | 1,407 | 6.8 | ||||||||||||||||||
Total Recreation Vehicles |
103,777 | 5.7 | 110,878 | 5.5 | (7,101 | ) | (6.4 | ) | ||||||||||||||||
Buses |
10,659 | 3.7 | 10,709 | 4.6 | (50 | ) | (.5 | ) | ||||||||||||||||
Corporate |
18,267 | | 14,303 | | 3,964 | 27.7 | ||||||||||||||||||
Total |
$ | 132,703 | 6.3 | $ | 135,890 | 6.0 | $ | (3,187 | ) | (2.3 | ) | |||||||||||||
INCOME BEFORE INCOME TAXES: |
||||||||||||||||||||||||
Recreation Vehicles |
||||||||||||||||||||||||
Towables |
$ | 110,290 | 7.9 | $ | 173,154 | 10.8 | $ | (62,864 | ) | (36.3 | ) | |||||||||||||
Motorized |
16,756 | 4.1 | 18,293 | 4.3 | (1,537 | ) | (8.4 | ) | ||||||||||||||||
Total Recreation Vehicles |
127,046 | 7.0 | 191,447 | 9.4 | (64,401 | ) | (33.6 | ) | ||||||||||||||||
Buses |
11,622 | 4.0 | 6,013 | 2.6 | 5,609 | 93.3 | ||||||||||||||||||
Corporate |
(9,471 | ) | | (7,372 | ) | | (2,099 | ) | (28.5 | ) | ||||||||||||||
Total |
$ | 129,197 | 6.1 | $ | 190,088 | 8.4 | $ | (60,891 | ) | (32.0 | ) | |||||||||||||
17
Average Price | ||||||||||||
Per Unit | Units | Net Change | ||||||||||
Recreation Vehicles |
||||||||||||
Towables |
8.4 | % | (21.4 | )% | (13.0 | )% | ||||||
Motorized |
| % | (2.9 | )% | (2.9 | )% |
18
Average Price Per Unit | Units | Net Change | ||||||||||
Buses |
12.2 | % | 14.2 | % | 26.4 | % |
19
1) | An order for a product has been received from a dealer; | ||
2) | Written or oral approval for payment has been received from the dealers flooring institution; |
20
3) | A common carrier signs the delivery ticket accepting responsibility for the product as agent for the dealer; and | ||
4) | The product is removed from the Companys property for delivery to the dealer who placed the order. |
21
22
| The Company has terminated the employment of the Dutchmen Vice President of Finance and has hired a new Vice President of Finance at Dutchmen; | ||
| The Company has eliminated the excessive accounting and information system access rights found to be available to the Dutchmen Vice President of Finance; | ||
| Since discovery of the activities of the former Dutchmen Vice President of Finance, the Company has assigned a member of its internal audit department to Dutchmen to assist in implementing full segregation of duties in Dutchmens accounting function; | ||
| The Company is modifying the duties of accounting personnel to improve segregation of duties and modifying certain information access rights at certain of its other operating subsidiaries; | ||
| The Company is providing additional training on fraud risk and awareness and assisting management and other key personnel to understand the lessons learned through the Dutchmen review; | ||
| To improve the Companys oversight of internal controls at its subsidiaries, the Companys Board of Directors has hired a professional services firm to lead and coordinate ongoing compliance efforts under Sarbanes-Oxley section 404 and partner with the internal audit function of the Company; | ||
| More frequent and in-depth periodic, unannounced internal audits of controls will be conducted at the subsidiary level; |
23
| The Company has enhanced its corporate level monitoring of the operating subsidiaries accounts receivable, accounts payable and cash reconciliations, including verification that financial information submitted by the operating subsidiaries agrees with the financial information recorded in the operating subsidiaries information systems; and | ||
| The Company has modified its reporting relationships so that heads of subsidiary accounting departments report directly to the Chief Financial Officer of the Company as opposed to subsidiary level presidents. |
24
(c) Total Number | (d) Maximum Number | |||||||||||||||
of Shares | (or Approximate | |||||||||||||||
(a) Total | (b) | (or Units) | Dollar Value) | |||||||||||||
Number | Average | Purchased as | of Shares (or Units) | |||||||||||||
of Shares | Price Paid | Part of Publicly | that May Yet Be | |||||||||||||
(or Units) | Per Share | Announced Plans | Purchased Under the | |||||||||||||
Period | Purchased | (or Unit) | or Programs (1) | Plans or Programs | ||||||||||||
February 2007 |
| | | 1,947,200 | ||||||||||||
March 2007 |
| | | 1,947,200 | ||||||||||||
April 2007 |
| | | 1,947,200 |
(1) | On June 26, 2006 our Board of Directors authorized the repurchase of an additional 2,000,000 shares extending over a 24-month period before expiring. At April 30, 2007, 1,947,200 shares of common stock remained authorized for repurchase under the repurchase program. |
Exhibit | Description | |
31.1
|
Chief Executive Officers Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
25
Exhibit | Description | |
31.2
|
Chief Financial Officers Certification filed pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1
|
Chief Executive Officers Certification furnished pursuant to Section 906 of the Sarbanes-Oxley Act 2002. | |
32.2
|
Chief Financial Officers Certification furnished pursuant to Section 906 of the Sarbanes-Oxley Act 2002. | |
99.1
|
Copy of press release issued by the Company on May 2, 2007. |
26
THOR INDUSTRIES, INC. (Registrant) |
||||
DATE: July 3, 2007 | By: | /s/ Wade F. B. Thompson | ||
Wade F. B. Thompson | ||||
Chairman of the Board, President and Chief Executive Officer |
||||
DATE: July 3, 2007 | By: | /s/ Walter L. Bennett | ||
Walter L. Bennett | ||||
Executive Vice President, Secretary and Chief Financial Officer |
||||
27