UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

~~Washington,~~

WASHINGTON, D.C. 20549

FORM10-Q

☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended January 31, ~~2018.~~

2024.

☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 for the transition period from ____ to.

____.

COMMISSION FILE NUMBER001-09235

~~THOR INDUSTRIES, INC.~~

~~(Exact name of registrant as specified in its charter)~~

THOR INDUSTRIES, INC.

~~Delaware~~

~~93-0768752~~

(Exact name of registrant as specified in its charter)

Delaware

93-0768752

(State or other jurisdiction of

(I.R.S. Employer

incorporation or organization)

~~(I.R.S. Employer~~

Identification No.)

601 E. Beardsley Ave., Elkhart, IN

46514-3305

(Address of principal executive offices)

(Zip Code)

~~(574)970-7460~~

(574) 970-7460

(~~Registrant’s~~Registrant's telephone number, including area code)

None

(Former name, former address and former fiscal year, if changed since last report)

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

Name of each exchange

Title of each class

Trading Symbol(s)

on which registered

Common stock (Par value $0.10 Per Share)

THO

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, ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of RegulationS-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files).

Yes☑No☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule12b-2 of the Exchange Act.


~~Large accelerated filer~~	☑	~~Accelerated filer~~	☐
~~Non-accelerated filer~~	☐ ~~(Do not check if a smaller reporting company)~~	~~Smaller reporting company~~	☐
~~Emerging growth company~~	☐

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 Rule12b-2 of the Exchange Act).

Yes☐No☑

As of February ~~28, 2018, 52,695,365~~29, 2024, 53,324,545 shares of the registrant’s common stock, par value $0.10 per share, were outstanding.

PART I – FINANCIAL INFORMATION (Unless otherwise indicated, amounts in thousands except share and per share data.)

~~ITEM~~1.

~~FINANCIAL STATEMENTS~~

ITEM 1. FINANCIAL STATEMENTS

THOR INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

   January 31, 2018 July 31, 2017
ASSETS
Current assets:

Cash and cash equivalents
   $ 109,775 $ 223,258
Accounts receivable, trade, net
   598,908 453,754
Accounts receivable, other, net
   25,177 31,090
Inventories, net
   590,363 460,488
Prepaid expenses and other
   9,979 11,577


Total current assets
   1,334,202 1,180,167


Property, plant and equipment, net
   466,215 425,238


Other assets:

Goodwill
   377,693 377,693
Amortizable intangible assets, net
   416,112 443,466
Deferred income taxes, net
   69,657 92,969
Other
   45,080 38,398


Total other assets
   908,542 952,526


TOTAL ASSETS
   $ 2,708,959 $ 2,557,931


LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable
   $ 354,499 $ 328,601
Accrued liabilities:

Compensation and related items
   105,882 100,114
Product warranties
   243,310 216,781
Income and other taxes
   13,818 51,211
Promotions and rebates
   51,717 46,459
Product, property and related liabilities
   19,332 16,521
Other
   28,559 21,359


Total current liabilities
   817,117 781,046


Long-term debt
   80,000 145,000
Unrecognized tax benefits
   10,507 10,263
Other liabilities
   53,406 45,082


Total long-term liabilities
   143,913 200,345


Contingent liabilities and commitments

Stockholders’ equity:

Preferred stock – authorized 1,000,000 shares; none outstanding
   —   —
Common stock – par value of $.10 per share; authorized 250,000,000 shares; issued 62,765,824 and 62,597,110 shares, respectively
   6,277 6,260
Additionalpaid-in capital
   245,390 235,525
Retained earnings
   1,839,990 1,670,826
Less treasury shares of 10,070,459 and 10,011,069, respectively, at cost
   (343,728 ) (336,071 )


Total stockholders’ equity
   1,747,929 1,576,540


TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
   $ 2,708,959 $ 2,557,931


	January 31, 2024		July 31, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	340,192	$	441,232

Accounts receivable, trade, net	534,402		543,865

Accounts receivable, other, net	91,216		99,354
Inventories, net	1,776,268		1,653,070
Prepaid income taxes, expenses and other	97,184		56,059

Total current assets	2,839,262		2,793,580
Property, plant and equipment, net	1,382,227		1,387,808
Other assets:
Goodwill	1,787,761		1,800,422
Amortizable intangible assets, net	925,515		996,979
Deferred income tax assets, net	9,455		5,770
Equity investments	128,572		126,909
Other	153,037		149,362
Total other assets	3,004,340		3,079,442
TOTAL ASSETS	$	7,225,829	$	7,260,830

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	762,095	$	736,275
Current portion of long-term debt	17,234		11,368
Short-term financial obligations	68,593		49,433
Accrued liabilities:
Compensation and related items	147,531		189,324
Product warranties	319,614		345,197
Income and other taxes	69,820		100,631
Promotions and rebates	132,948		163,410
Product, property and related liabilities	38,619		54,720


Other	70,007		66,124

Total current liabilities	1,626,461		1,716,482
Long-term debt, net	1,390,469		1,291,311
Deferred income tax liabilities, net	68,517		75,668
Unrecognized tax benefits	15,931		14,835
Other liabilities	181,856		179,136
Total long-term liabilities	1,656,773		1,560,950
Contingent liabilities and commitments
Stockholders’ equity:
Preferred stock – authorized 1,000,000 shares; none outstanding	—		—
Common stock – par value of $.10 per share; authorized 250,000,000 shares; issued 66,859,738 and 66,344,340 shares, respectively	6,686		6,634
Additional paid-in capital	560,365		539,032
Retained earnings	4,101,210		4,091,563
Accumulated other comprehensive loss, net of tax	(92,894)		(68,547)
Less: Treasury shares of 13,535,193 and 13,030,030, respectively, at cost	(638,949)		(592,667)
Stockholders’ equity attributable to THOR Industries, Inc.	3,936,418		3,976,015
Non-controlling interests	6,177		7,383
Total stockholders’ equity	3,942,595		3,983,398
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,225,829	$	7,260,830

See Notes to the Condensed Consolidated Financial Statements.

THOR INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

~~FOR THE THREE AND SIX MONTHS ENDED JANUARY 31, 2018 AND 2017~~ (UNAUDITED)

   Three Months Ended
January 31,    Six Months Ended
January 31,
   2018    2017    2018    2017
Net sales
   $ 1,971,560    $ 1,588,525    $ 4,203,228    $ 3,297,056
Cost of products sold
   1,701,232    1,376,823    3,599,715    2,848,602








Gross profit
   270,328    211,702    603,513    448,454
Selling, general and administrative expenses
   117,088    96,969    251,351    199,279
Amortization of intangible assets
   13,796    15,279    27,354    33,494
Interest income
   401    177    782    330
Interest expense
   1,354    2,486    2,766    5,046
Other income, net
   2,574    1,220    5,332    3,200








Income before income taxes
   141,065    98,365    328,156    214,165
Income taxes
   61,313    33,583    119,998    70,638








Net income and comprehensive income
   $ 79,752    $ 64,782    $ 208,158    $ 143,527








Weighted-average common shares outstanding:

Basic
   52,694,680    52,582,134    52,653,303    52,543,050
Diluted
   52,861,140    52,740,959    52,839,752    52,723,450
Earnings per common share:

Basic
   $ 1.51    $ 1.23    $ 3.95    $ 2.73
Diluted
   $ 1.51    $ 1.23    $ 3.94    $ 2.72
Regular dividends declared and paid per common share
   $ 0.37    $ 0.33    $ 0.74    $ 0.66


	Three Months Ended January 31,				Six Months Ended January 31,
	2024		2023		2024		2023
Net sales	$	2,207,369	$	2,346,635	$	4,708,128	$	5,454,719
Cost of products sold	1,936,522		2,063,700		4,079,349		4,685,308
Gross profit	270,847		282,935		628,779		769,411
Selling, general and administrative expenses	220,125		208,743		438,021		450,367
Amortization of intangible assets	32,464		35,199		64,808		70,418


Interest expense, net	28,229		25,633		48,426		48,440
Other income, net	16,865		19,358		1,952		11,803
Income before income taxes	6,894		32,718		79,476		211,989
Income tax provision	1,568		6,912		19,117		48,760
Net income	5,326		25,806		60,359		163,229
Less: Net loss attributable to non-controlling interests	(1,891)		(1,274)		(423)		(36)
Net income attributable to THOR Industries, Inc.	$	7,217	$	27,080	$	60,782	$	163,265

Weighted-average common shares outstanding:
Basic	53,322,504		53,518,878		53,309,169		53,587,646
Diluted	53,650,583		53,810,910		53,752,150		53,869,830

Earnings per common share:
Basic	$	0.14	$	0.51	$	1.14	$	3.05
Diluted	$	0.13	$	0.50	$	1.13	$	3.03




Comprehensive income:
Net income	$	5,326	$	25,806	$	60,359	$	163,229
Other comprehensive income (loss), net of tax
Foreign currency translation adjustment	35,627		128,377		(25,019)		85,048
Unrealized gain (loss) on derivatives, net of tax	—		(661)		—		143
Other loss, net of tax	(111)		(39)		(111)		(39)
Total other comprehensive income (loss), net of tax	35,516		127,677		(25,130)		85,152
Total Comprehensive income	40,842		153,483		35,229		248,381
Less: Comprehensive loss attributable to non-controlling interests	(1,952)		(1,249)		(1,206)		(445)
Comprehensive income attributable to THOR Industries, Inc.	$	42,794	$	154,732	$	36,435	$	248,826

See Notes to the Condensed Consolidated Financial Statements.

THOR INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

~~FOR THE SIX MONTHS ENDED JANUARY 31, 2018 AND 2017~~ (UNAUDITED)

   Six Months Ended January 31,
   2018    2017
Cash flows from operating activities:

Net income
   $ 208,158    $ 143,527
Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation
   18,619    16,911
Amortization of intangibles
   27,354    33,494
Amortization of debt issuance costs
   785    785
Deferred income tax provision (benefit)
   23,312    (4,291)
Gain on disposition of property, plant and equipment
   (1,482)    (2,262)
Stock-based compensation expense
   8,731    5,892
Changes in assets and liabilities (excluding acquisitions):

Accounts receivable
   (138,930)    (96,712)
Inventories
   (129,875)    (73,729)
Prepaid income taxes, expenses and other
   (7,140)    (8,455)
Accounts payable
   27,235    28,591
Accrued liabilities
   11,283    6,353
Long-term liabilities and other
   8,795    2,712




Net cash provided by operating activities
   56,845    52,816




Cash flows from investing activities:

Purchases of property, plant and equipment
   (63,003)    (50,924)
Proceeds from dispositions of property, plant and equipment
   3,552    4,554
Acquisitions
   —       (5,039)
Other
   960    (2,213)




Net cash used in investing activities
   (58,491)    (53,622)




Cash flows from financing activities:

Principal payments on revolving credit facility
   (65,000)    (35,000)
Regular cash dividends paid
   (38,994)    (34,704)
Principal payments on capital lease obligations
   (186)    (165)
Payments related to vesting of stock-based awards
   (7,657)    (4,572)




Net cash used in financing activities
   (111,837)    (74,441)




Net decrease in cash and cash equivalents
   (113,483)    (75,247)
Cash and cash equivalents, beginning of period
   223,258    209,902




Cash and cash equivalents, end of period
   $ 109,775    $ 134,655




Supplemental cash flow information:

Income taxes paid
   $ 137,169    $ 97,180
Interest paid
   $ 2,114    $ 4,466
Non-cash transactions:

Capital expenditures in accounts payable
   $ 4,929    $ 2,904


	Six Months Ended January 31,
	2024		2023
Cash flows from operating activities:
Net income	$	60,359	$	163,229
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation	70,589		64,257
Amortization of intangible assets	64,808		70,418
Amortization of debt issuance costs and extinguishment charges	11,864		5,697


Deferred income tax benefit	(11,858)		(6,149)
Gain on disposition of property, plant and equipment	(7,807)		(371)
Stock-based compensation expense	19,698		16,935
Changes in assets and liabilities:
Accounts receivable, net	15,188		301,269
Inventories, net	(149,742)		(83,564)
Prepaid income taxes, expenses and other	(24,312)		(14,572)
Accounts payable	33,813		(209,557)

Accrued liabilities	(133,798)		(125,590)
Long-term liabilities and other	6,998		3,319
Net cash provided by (used in) operating activities	(44,200)		185,321
Cash flows from investing activities:
Purchases of property, plant and equipment	(78,901)		(100,985)
Proceeds from dispositions of property, plant and equipment	12,872		3,832
Business acquisitions, net of cash acquired	(3,814)		(6,184)


Other	(11,100)		(10,411)
Net cash used in investing activities	(80,943)		(113,748)
Cash flows from financing activities:
Borrowings on term-loan credit facilities	186,723		—
Payments on term-loan credit facilities	(127,626)		(12,355)
Borrowings on revolving asset-based credit facilities	113,502		—
Payments on revolving asset-based credit facilities	(51,925)		(15,000)


Payments on other debt	(5,574)		(6,383)
Payments of debt issuance costs	(10,480)		—
Cash dividends paid	(51,135)		(48,165)
Payments on finance lease obligations	(365)		(604)
Purchases of treasury shares	(30,037)		(25,407)
Payments related to vesting of stock-based awards	(16,245)		(6,765)
Short-term financial obligations and other, net	19,916		12,937
Net cash provided by (used in) financing activities	26,754		(101,742)
Effect of exchange rate changes on cash and cash equivalents	(2,651)		172
Net decrease in cash and cash equivalents	(101,040)		(29,997)
Cash and cash equivalents, beginning of period	441,232		311,553


Cash and cash equivalents, end of period	$	340,192	$	281,556

Supplemental cash flow information:
Income taxes paid	$	90,528	$	110,662
Interest paid	$	41,414	$	44,981
Non-cash investing and financing transactions:
Capital expenditures in accounts payable	$	3,098	$	5,183

See Notes to the Condensed Consolidated Financial Statements.

THOR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE AND SIX MONTHS ENDED JANUARY 31, 2024 AND 2023 (UNAUDITED)
Three Months Ended January 31, 2024
Accumulated Stockholders’
Additional Other Equity Non- Total
Common Stock Paid-In Retained Comprehensive Treasury Stock Attributable controlling Stockholders’
Shares Amount Capital Earnings Income (Loss) Shares Amount to THOR Interests Equity
Balance at November 1, 2023 66,686,498 $ 6,669 $ 551,491 $ 4,119,589 $ (128,471) 13,480,026 $ (633,817) $ 3,915,461 $ 8,129 $ 3,923,590
Net income (loss) — — — 7,217 — — — 7,217 (1,891) 5,326
Purchases of treasury shares — — — — — — — — — —
Restricted stock unit activity 173,240 17 (372) — — 55,167 (5,132) (5,487) — (5,487)
Dividends $0.48 per common share — — — (25,596) — — — (25,596) — (25,596)
Stock-based compensation expense — — 9,246 — — — — 9,246 — 9,246
Other comprehensive income (loss) — — — — 35,577 — — 35,577 (61) 35,516
Balance at January 31, 2024 66,859,738 $ 6,686 $ 560,365 $ 4,101,210 $ (92,894) 13,535,193 $ (638,949) $ 3,936,418 $ 6,177 $ 3,942,595
Six Months Ended January 31, 2024
Accumulated Stockholders’
Additional Other Equity Non- Total
Common Stock Paid-In Retained Comprehensive Treasury Stock Attributable controlling Stockholders’
Shares Amount Capital Earnings Income (Loss) Shares Amount to THOR Interests Equity
Balance at August 1, 2023 66,344,340 $ 6,634 $ 539,032 $ 4,091,563 $ (68,547) 13,030,030 $ (592,667) $ 3,976,015 $ 7,383 $ 3,983,398
Net income (loss) — — — 60,782 — — — 60,782 (423) 60,359
Purchases of treasury shares — — — — — 327,876 (30,037) (30,037) — (30,037)
Restricted stock unit activity 515,398 52 1,635 — — 177,287 (16,245) (14,558) — (14,558)
Dividends $0.96 per common share — — — (51,135) — — — (51,135) — (51,135)
Stock-based compensation expense — — 19,698 — — — — 19,698 — 19,698
Other comprehensive income (loss) — — — — (24,347) — — (24,347) (783) (25,130)
Balance at January 31, 2024 66,859,738 $ 6,686 $ 560,365 $ 4,101,210 $ (92,894) 13,535,193 $ (638,949) $ 3,936,418 $ 6,177 $ 3,942,595

See Notes to the Condensed Consolidated Financial Statements.

THOR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE AND SIX MONTHS ENDED JANUARY 31, 2024 AND 2023 (UNAUDITED)
Three Months Ended January 31, 2023
Accumulated Stockholders’
Additional Other Equity Non- Total
Common Stock Paid-In Retained Comprehensive Treasury Stock Attributable controlling Stockholders’
Shares Amount Capital Earnings Income (Loss) Shares Amount to THOR Interests Equity
Balance at November 1, 2022 66,326,135 $ 6,633 $ 509,579 $ 3,925,365 $ (223,698) 12,813,019 $ (575,516) $ 3,642,363 $ 8,596 $ 3,650,959
Net income (loss) — — — 27,080 — — — 27,080 (1,274) 25,806
Restricted stock unit activity 7,937 — (612) — — 2,080 (159) (771) — (771)
Dividends $0.45 per common share — — — (24,084) — — — (24,084) — (24,084)
Stock-based compensation expense — — 8,543 — — — — 8,543 — 8,543
Other comprehensive income (loss) — — — — 127,652 — — 127,652 25 127,677
Balance at January 31, 2023 66,334,072 $ 6,633 $ 517,510 $ 3,928,361 $ (96,046) 12,815,099 $ (575,675) $ 3,780,783 $ 7,347 $ 3,788,130
Six Months Ended January 31, 2023
Accumulated Stockholders’
Additional Other Equity Non- Total
Common Stock Paid-In Retained Comprehensive Treasury Stock Attributable controlling Stockholders’
Shares Amount Capital Earnings Income (Loss) Shares Amount to THOR Interests Equity
Balance at August 1, 2022 66,059,403 $ 6,606 $ 497,946 $ 3,813,261 $ (181,607) 12,382,441 $ (543,344) $ 3,592,862 $ 7,792 $ 3,600,654
Net income (loss) — — — 163,265 — — — 163,265 (36) 163,229
Purchases of treasury shares — — — — — 338,733 (25,407) (25,407) — (25,407)
Restricted stock unit activity 274,669 27 2,629 — — 93,925 (6,924) (4,268) — (4,268)
Dividends $0.90 per common share — — — (48,165) — — — (48,165) — (48,165)
Stock-based compensation expense — — 16,935 — — — — 16,935 — 16,935
Other comprehensive income (loss) — — — — 85,561 — — 85,561 (409) 85,152
Balance at January 31, 2023 66,334,072 $ 6,633 $ 517,510 $ 3,928,361 $ (96,046) 12,815,099 $ (575,675) $ 3,780,783 $ 7,347 $ 3,788,130

See Notes to the Condensed Consolidated Financial Statements.

6

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(All ~~dollar~~U.S. Dollar and Euro amounts presented in thousands except share and per share ~~data)~~

1.	~~Nature of Operations and Accounting Policies~~

data or except as otherwise specified)

1. Nature of Operations

~~Thor~~ and Accounting Policies

Nature of Operations

THOR Industries, Inc. was founded in 1980 and ~~through its~~is the sole owner of operating subsidiaries (collectively, the “Company” or “THOR”), ~~manufactures a wide range~~that, combined, represent the world's largest manufacturer of recreational vehicles (“RVs”) ~~at various manufacturing facilities located~~. The Company manufactures a wide variety of RVs in the United States and Europe and sells those vehicles, as well as related parts and accessories, primarily ~~in Indiana, with additional facilities in Ohio, Oregon, Idaho and Michigan. These products are sold~~ to independent,non-franchise dealers ~~primarily~~ throughout the United States, Canada and ~~Canada.~~Europe. Unless the context requires or indicates otherwise, all references to ~~“Thor”,~~“THOR,” the ~~“Company”, “we”,~~“Company,” “we,” “our” and “us” refer to ~~Thor~~THOR Industries, Inc. and its subsidiaries.

The July 31, ~~2017~~2023 amounts are derived from the annual audited financial ~~statements.~~statements of THOR. 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 cash flows for the interim periods presented have been made. These financial statements should be read in conjunction with the Company’s Annual Report on Form10-K for the fiscal year ended July 31, ~~2017.~~2023. Due to seasonality within the recreational vehicle industry, the impact of supply chain disruptions primarily in Europe, inflation and shifting consumer demand on our industry, among other factors, annualizing the results of operations for the six months ended January 31, ~~2018~~2024 would not necessarily be indicative of the results expected for athe full fiscal ~~year, and recreational vehicle sales are historically lowest during the second fiscal quarter ending January 31.~~

year.

Recently Issued Accounting ~~Pronouncements~~

Standards Not Yet Adopted

In ~~January 2017,~~November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting ~~Standards~~Standard Update ~~(“ASU”)~~No. ~~2017-04,~~ ~~“Intangibles—Goodwill and Other~~2023-07 (“ASU 2023-07”) “Segment Reporting (Topic ~~350)~~280): ~~Simplifying the Test for Goodwill Impairment,”~~Improvements to Reportable Segment Disclosures”, which eliminates the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge (referred to as Step 2 in the goodwill impairment test). Instead, if the carrying amount of a reporting unit exceeds its fair value, an impairment charge equal to that excess shall be recognized, not to exceed the amount of goodwill allocatedrequires additional disclosures about significant segment expenses regularly provided to the ~~reporting unit. This~~Chief Operating Decision Maker. ASU 2023-07 is effective for annual ~~and any interim impairment tests for~~reporting periods beginning after December 15, ~~2019, with early~~2023, or the annual report for fiscal 2025 for the Company, and interim periods within fiscal years beginning after December 15, 2024, or interim periods starting in fiscal 2026 for the Company. Early adoption ~~permitted~~is permitted. We are currently evaluating the impact of ASU 2023-07 on our consolidated financial statements and related disclosures.

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”, requiring enhancements and further transparency to certain income tax disclosures. Under this ASU, entities must disclose, on an annual basis, specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. In addition, ASU 2023-09 requires entities to disclose additional information about income taxes paid. The new standard also eliminates certain existing disclosure requirements related to uncertain tax positions and unrecognized deferred tax liabilities. ASU 2023-09 is effective for financial statements for annual periods beginning after ~~January 1, 2017.~~December 15, 2024. This ASU is effective for the Company in its fiscal year ~~2021~~2026 beginning on August 1, ~~2020.~~2025. The Company is currently evaluating the potential impact of adopting this ~~ASU on its consolidated financial statements, which will depend on the outcomes of future goodwill impairment tests.~~

~~In February 2016, the FASB issued ASUNo. 2016-02,~~ ~~“Leases (Topic 842),” which provides~~ guidance on the ~~recognition, measurement, presentation, and disclosure of leases. ASUNo. 2016-02~~ requires the recognition of lease assets and lease liabilities by lessees for all leases with terms greater than 12 months. The principal difference from current guidance is that the lease assets and lease liabilities arising from operating leases will be recognized on the Consolidated Balance Sheet. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2018. Early adoption is permitted. This ASU is effective for the Company in its fiscal year 2020 beginning on August 1, 2019. The Company is currently evaluating the impact that implementing this ASU will have on its financial statements.

~~In July 2015, the FASB issued ASUNo. 2015-11,~~ ~~“Inventory (Topic 330): Simplifying the Measurement of Inventory.” ASUNo. 2015-11~~ ~~requires inventory measured using any method other thanlast-in,first-out~~ (“LIFO”) or the retail inventory method to be subsequently measured at the lower of cost or net realizable value, rather than at the lower of cost or market. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. Under this ASU, subsequent measurement of inventory using the LIFO and retail inventory method is unchanged. ASU~~No. 2015-11~~ ~~is effective prospectively for fiscal years, and for interim periods within those years, beginning after December 15, 2016. The Company adopted ASUNo. 2015-11~~ ~~on August 1, 2017 and there was no material impact on the Condensed Consolidated Financial Statements.~~

~~In May 2014, the FASB issued ASUNo. 2014-09,~~ “Revenue from Contracts with Customers (Topic 606),” which outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. This ASU will supersede most current revenue recognition guidance. Under this ASU, entities are required to identify the contract with a customer, identify the separate performance obligations in the contract, determine the transaction price, allocate the transaction price to the separate performance obligations in the contract and recognize the appropriate amount of revenue when (or as) the entity satisfies each performance obligation. This ASU will also require additional qualitative and quantitative disclosures about contracts with customers, significant judgments made in applying the revenue guidance, and assets recognized from the costs to obtain or fulfill a contract. ASU~~No. 2014-09~~ is effective for fiscal years, and the interim periods within those years, beginning after December 15, 2017. This ASU is effective for the Company in its fiscal year 2019 beginning on August 1, 2018. In applying this ASU, entities have the option of using either a full retrospective transition or a modified retrospective approach with the cumulative effect recognized as of the date of adoption. The Company plans to use the modified retrospective approach in applying this ASU.

The Company is in the process of analyzing and quantifying the adoption impact of this ASU as well as evaluating the impact to internal controls, business processes and financial statement disclosures under this ASU. While the Company is still completing its assessment of all the potential impacts of this ASU, the Company does not anticipate adoption will have a material impact to the consolidated financial statements. The ASU will, however, require more extensive revenue-related disclosures. The Company will continue evaluation of the adoption of this ASU through the date of adoption, including assessing the impact of required financial statement disclosures.

2.	~~Acquisition~~

~~Jayco, Corp.~~

On June 30, 2016, the Company closed on a Stock Purchase Agreement (“Jayco SPA”) for the acquisition of all the issued and outstanding capital stock of towable and motorized recreational vehicle manufacturer Jayco, Corp. (“Jayco”) for initial cash consideration of $576,060, subject to adjustment. This acquisition was funded from the Company’s cash on hand and $360,000 from an asset-based revolving credit facility as more fully described in Note 11 to the Condensed Consolidated Financial Statements. The final purchase price adjustment of $5,039 was based on the final determination of net assets as of the June 30, 2016 closing date and was paid during the first quarter of fiscal 2017. Jayco operates as an independent operation in the same manner as the Company’s other recreational vehicle subsidiaries, and its towables operations are aggregated within the Company’s towable recreational vehicle reportable segment and its motorized operations are aggregated within the Company’s motorized recreational vehicle reportable segment. The Company purchased Jayco to complement its existing towable and motorized RV product offerings and dealer base.

~~The following table summarizes the final fair values assigned to the Jayco net assets acquired, which were based on internal and independent external valuations:~~

Cash
   $ 18,409
Other current assets
   258,158
Property, plant and equipment
   80,824
Dealer network
   261,100
Trademarks
   92,800
Backlog
   12,400
Goodwill
   74,184
Current liabilities
   (216,776 )


Total fair value of net assets acquired
   581,099
Less cash acquired
   (18,409 )


Total cash consideration for acquisition, less cash acquired
   $ 562,690

On the acquisition date, amortizable intangible assets had a weighted-average useful life of 19.3 years. The dealer network was valued based on the Discounted Cash Flow Method and is amortized on an accelerated basis over 20 years. The trademarks were valued on the Relief from Royalty Method and are amortized on a straight-line basis over 20 years. Backlog was valued based on the Discounted Cash Flow Method and was amortized on a straight-line basis over 3 months. Goodwill is deductible for tax purposes.

3.	~~Business Segments~~

2. Business Segments

The Company has ~~two~~three reportable segments, ~~both~~all related to recreational vehicles: (1) ~~towables~~North American Towable Recreational Vehicles, (2) North American Motorized Recreational Vehicles and (2) motorized. The towable recreational vehicle reportable segment consists of the following operating segments that have been aggregated: Airstream (towable), Heartland (including Bison, Cruiser RV and DRV), Jayco (including Jayco towable, Starcraft and Highland Ridge), Keystone (including CrossRoads and Dutchmen) and KZ (including Livin’ Lite). The motorized recreational vehicle reportable segment consists of the following operating segments that have been aggregated: Airstream (motorized), Jayco (including Jayco motorized and Entegra Coach) and Thor Motor Coach.

(3) European Recreational Vehicles. The operations of the ~~Company’s~~Company's Airxcel and Postle ~~subsidiary~~subsidiaries are included in ~~“Other,” which is anon-reportable~~ ~~segment.~~“Other”. Net sales included in Other ~~mainly~~ relate primarily to the sale of ~~aluminum extrusions and~~ specialized component ~~products.~~parts and aluminum extrusions. Intercompany eliminations adjust for Airxcel and Postle sales to the Company’s ~~towable~~North American Towable and ~~motorized~~North American Motorized segments, which are consummated at established~~arm’s-length~~ transfer prices generally consistent with the selling prices of ~~extrusion components~~products to ~~third-party customers.~~

~~All manufacturing is conducted within the United States. Total assets include those assets used in the operation of each~~third parties.

The following tables reflect certain financial information by reportable ~~andnon-reportable~~ segment, and the Corporate assets consist primarily of cash and cash equivalents, deferred net income tax and deferred compensation plan assets and certain Corporate real estate holdings primarily utilized by Thor operating subsidiaries.

   Three Months Ended
January 31,    Six Months Ended
January 31,
Net sales:    2018    2017    2018    2017
Recreational vehicles

Towables
   $ 1,373,118    $ 1,082,249    $ 2,991,619    $ 2,293,122
Motorized
   559,909    474,972    1,126,520    936,426








Total recreational vehicles
   1,933,027    1,557,221    4,118,139    3,229,548
Other
   68,013    53,891    150,932    112,887
Intercompany eliminations
   (29,480 )    (22,587 )    (65,843 )    (45,379 )








Total
   $ 1,971,560    $ 1,588,525    $ 4,203,228    $ 3,297,056








   Three Months Ended
January 31,    Six Months Ended
January 31,
Income (loss) before income taxes:    2018    2017    2018    2017
Recreational vehicles

Towables
   $ 116,728    $ 78,000    $ 275,579    $ 172,173
Motorized
   37,538    28,488    75,124    57,411








Total recreational vehicles
   154,266    106,488    350,703    229,584
Other, net
   5,290    5,696    13,773    12,074
Corporate
   (18,491 )    (13,819 )    (36,320 )    (27,493 )








Total
   $ 141,065    $ 98,365    $ 328,156    $ 214,165








Total assets:    January 31, 2018    July 31, 2017
Recreational vehicles

Towables
   $ 1,689,874    $ 1,535,029
Motorized
   625,140    500,761





Total recreational vehicles
   2,315,014    2,035,790
Other, net
   159,630    156,996
Corporate
   234,315    365,145





Total
   $ 2,708,959    $ 2,557,931

segment:


	Three Months Ended January 31,				Six Months Ended January 31,
NET SALES:	2024		2023		2024		2023
Recreational vehicles
North American Towable	$	730,968	$	829,751	$	1,676,422	$	2,147,557
North American Motorized	570,424		738,583		1,281,583		1,862,102
Total North America	1,301,392		1,568,334		2,958,005		4,009,659
European	782,294		646,938		1,490,495		1,151,240
Total recreational vehicles	2,083,686		2,215,272		4,448,500		5,160,899
Other	166,534		164,859		365,455		397,507
Intercompany eliminations	(42,851)		(33,496)		(105,827)		(103,687)
Total	$	2,207,369	$	2,346,635	$	4,708,128	$	5,454,719


	Three Months Ended January 31,				Six Months Ended January 31,
INCOME (LOSS) BEFORE INCOME TAXES:	2024		2023		2024		2023

Recreational vehicles
North American Towable	$	661	$	(7,119)	$	49,910	$	103,888
North American Motorized	26,460		61,544		63,512		185,977
Total North America	27,121		54,425		113,422		289,865
European	38,057		12,015		66,824		5,547
Total recreational vehicles	65,178		66,440		180,246		295,412
Other, net	7,343		8,289		16,819		13,034
Corporate	(65,627)		(42,011)		(117,589)		(96,457)
Total	$	6,894	$	32,718	$	79,476	$	211,989


TOTAL ASSETS:	January 31, 2024		July 31, 2023
Recreational vehicles
North American Towable	$	1,375,699	$	1,429,899
North American Motorized	1,226,909		1,268,109
Total North America	2,602,608		2,698,008
European	2,988,415		2,898,175
Total recreational vehicles	5,591,023		5,596,183
Other	1,023,371		1,048,076
Corporate	611,435		616,571
Total	$	7,225,829	$	7,260,830

   Three Months Ended
January 31,    Six Months Ended
January 31,
Depreciation and intangible amortization expense:    2018    2017    2018    2017
Recreational vehicles

Towables
   $ 17,223    $ 18,238    $ 34,016    $ 39,164
Motorized
   2,909    2,246    5,637    4,589








Total recreational vehicles
   20,132    20,484    39,653    43,753
Other
   2,748    3,012    5,557    6,016
Corporate
   395    314    763    636








Total
   $ 23,275    $ 23,810    $ 45,973    $ 50,405








   Three Months Ended
January 31,    Six Months Ended
January 31,
Capital acquisitions:    2018    2017    2018    2017
Recreational vehicles

Towables
   $ 18,821    $ 15,453    $ 36,413    $ 36,318
Motorized
   1,754    6,889    14,069    12,045








Total recreational vehicles
   20,575    22,342    50,482    48,363
Other
   1,983    314    2,593    610
Corporate
   7,016    1,141    8,591    1,317








Total
   $ 29,574    $ 23,797    $ 61,666    $ 50,290

4.	~~Earnings Per Common Share~~


DEPRECIATION AND INTANGIBLE ASSET AMORTIZATION EXPENSE:	Three Months Ended January 31,				Six Months Ended January 31,
	2024		2023		2024		2023
Recreational vehicles
North American Towable	$	13,788	$	15,028	$	27,552	$	30,465
North American Motorized	8,849		8,172		17,791		16,333
Total North America	22,637		23,200		45,343		46,798
European	31,136		28,713		61,533		56,015
Total recreational vehicles	53,773		51,913		106,876		102,813
Other	13,668		15,338		27,294		30,986
Corporate	678		431		1,227		876
Total	$	68,119	$	67,682	$	135,397	$	134,675


	Three Months Ended January 31,				Six Months Ended January 31,
CAPITAL ACQUISITIONS:	2024		2023		2024		2023
Recreational vehicles
North American Towable	$	4,443	$	16,820	$	11,373	$	37,994
North American Motorized	5,386		10,266		12,861		29,330
Total North America	9,829		27,086		24,234		67,324
European	16,116		12,151		30,876		21,071
Total recreational vehicles	25,945		39,237		55,110		88,395
Other	6,244		7,957		14,535		12,769
Corporate	4,172		151		6,907		271
Total	$	36,361	$	47,345	$	76,552	$	101,435

3. Earnings Per Common Share

The following table reflects the weighted-average common shares used to compute basic and diluted earnings per common share as included on the Condensed Consolidated Statements of Income and Comprehensive Income:

   Three Months Ended
January 31,    Six Months Ended
January 31,
   2018    2017    2018    2017
Weighted-average shares outstanding for basic earnings per share
   52,694,680    52,582,134    52,653,303    52,543,050
Unvested restricted stock and restricted stock units
   166,460    158,825    186,449    180,400








Weighted-average shares outstanding assuming dilution
   52,861,140    52,740,959    52,839,752    52,723,450


	Three Months Ended January 31,		Six Months Ended January 31,
	2024	2023	2024	2023
Weighted-average common shares outstanding for basic earnings per share	53,322,504	53,518,878	53,309,169	53,587,646
Unvested restricted and performance stock units	328,079	292,032	442,981	282,184
Weighted-average common shares outstanding assuming dilution	53,650,583	53,810,910	53,752,150	53,869,830

For the three months ended January 31, ~~2018~~2024 and ~~2017,~~2023, the Company had ~~35,149~~8,078 and ~~27,742, respectively, of~~169,350 unvested restricted stock units and ~~restricted~~performance stock units outstanding, respectively, which were excluded from this calculation as their effect would behave been antidilutive.

5.	~~Fair Value Measurements~~

For the six months ended January 31, 2024 and 2023, the Company had 29,688 and 186,895 unvested restricted stock units and performance stock units outstanding, respectively, which were excluded from this calculation as their effect would have been antidilutive.

4. Derivatives and Hedging

The ~~Company assesses~~total amounts presented in the ~~inputs used~~Condensed Consolidated Statements of Income and Comprehensive Income due to ~~measure~~changes in the fair value of the derivative instruments are as follows:


	Three Months Ended January 31,
	2024		2023
Gain (Loss) on Derivatives Designated as Cash Flow Hedges

Gain (Loss) recognized in Other Comprehensive Income, net of tax

Interest rate swap agreements (1)	$	—	$	(661)
Total gain (loss)	$	—	$	(661)

(1)Other comprehensive income (loss), net of tax, before reclassification from accumulated other comprehensive income (“AOCI”) was $0 and $(136) for the three months ended January 31, 2024 and 2023, respectively.


	Six Months Ended January 31,
	2024		2023
Gain (Loss) on Derivatives Designated as Cash Flow Hedges

Gain (Loss) recognized in Other Comprehensive Income, net of tax

Interest rate swap agreements (2)	$	—	$	85
Total gain (loss)	$	—	$	85

(2)Other comprehensive income (loss), net of tax, before reclassification from AOCI was $0 and $718 for the six months ended January 31, 2024 and 2023, respectively.


	Three Months Ended January 31,
	2024				2023
			Interest					Interest
	Sales		Expense			Sales		Expense
Gain (Loss) Reclassified from AOCI, Net of Tax

Interest rate swap agreements	$	—	$	—		$	—	$	525
Gain (Loss) on Derivatives Not Designated as Hedging Instruments
Gain (loss) recognized in income, net of tax
Foreign currency forward contracts	(236)		—			1,118		—
Commodities swap agreements	—		—			(1,567)		—
Interest rate swap agreements	—		(205)			—		(83)
Total gain (loss)	$	(236)	$	(205)		$	(449)	$	442


	Six Months Ended January 31,
	2024				2023
			Interest					Interest
	Sales		Expense			Sales		Expense
Gain (Loss) Reclassified from AOCI, Net of Tax
Foreign currency forward contracts	$	—	$	—		$	(58)	$	—
Interest rate swap agreements	—		—			—		633
Gain (Loss) on Derivatives Not Designated as Hedging Instruments
Gain (loss) recognized in income, net of tax
Foreign currency forward contracts	(75)		—			1,946		—
Commodities swap agreements	—		—			(2,229)		—
Interest rate swap agreements	—		(139)			—		171
Total gain (loss)	$	(75)	$	(139)		$	(341)	$	804

As of January 31, 2024 and July 31, 2023 there were no derivative instruments designated as cash flow hedges. The Company has certain other derivative instruments which have not been designated as hedges. These other derivative instruments had a notional amount totaling approximately $78,772 and a fair value liability of $1,509 as of January 31, 2024. These other derivative instruments had a notional amount totaling approximately $25,248 and a fair value liability of $932 as of July 31, 2023. For these derivative instruments, changes in fair value are recognized in earnings.

Net Investment Hedges

The foreign currency transaction gains and losses on the Euro-denominated portion of the term loan, which is designated and effective as a hedge of the Company’s net investment in its Euro-denominated functional currency subsidiaries, are included as a component of the foreign currency translation adjustment. A loss, net of tax, was included in the foreign currency translation adjustment of $6,237 for the three months ended January 31, 2024 and a gain of $7,172 was included for the six months ended January 31, 2024. Losses, net of tax, included in the foreign currency translation adjustments were $30,297 for the three months ended January 31, 2023 and $20,912 for the six months ended January 31, 2023.

There were no amounts reclassified out of AOCI pertaining to the net investment hedge during the three and six-month periods ended January 31, 2024 and January 31, 2023, respectively.

5. Inventories

Major classifications of inventories are as follows:


	January 31, 2024		July 31, 2023
Finished goods – RV	$	283,273	$	164,456
Finished goods – other	87,933		93,476
Work in process	330,193		313,006
Raw materials	494,791		563,614
Chassis	739,682		681,122
Subtotal	1,935,872		1,815,674
Excess of FIFO costs over LIFO costs	(159,604)		(162,604)
Total inventories, net	$	1,776,268	$	1,653,070

Of the $1,935,872 and $1,815,674 of inventories at January 31, 2024 and July 31, 2023, $1,344,893 and $1,224,069, respectively, were valued on the first-in, first-out (“FIFO”) method, and $590,979 and $591,605, respectively, were valued on the last-in, first-out (“LIFO”) method.

6. Property, Plant and Equipment

Property, plant and equipment consists of the following:


	January 31, 2024		July 31, 2023
Land	$	155,021	$	147,633
Buildings and improvements	1,045,796		1,038,394
Machinery and equipment	691,731		672,499
Rental vehicles	111,686		99,360
Lease right-of-use assets – operating	43,741		47,969
Lease right-of-use assets – finance	5,145		5,518
Total cost	2,053,120		2,011,373
Less: Accumulated depreciation	(670,893)		(623,565)
Property, plant and equipment, net	$	1,382,227	$	1,387,808

See Note 15 to the Condensed Consolidated Financial Statements for further information regarding the lease right-of-use assets.

7. Intangible Assets and Goodwill

The components of Amortizable intangible assets, net are as follows:



	January 31, 2024				July 31, 2023
			Accumulated				Accumulated
	Cost		Amortization		Cost		Amortization
Dealer networks/customer relationships	$	1,106,507	$	567,048	$	1,112,273	$	526,327
Trademarks	353,500		104,621		355,560		96,087
Design technology and other intangibles	255,892		118,715		258,868		107,483

Non-compete agreements	1,400		1,400		1,400		1,225
Total amortizable intangible assets	$	1,717,299	$	791,784	$	1,728,101	$	731,122

Estimated future amortization expense is as follows:


For the remainder of the fiscal year ending July 31, 2024	$	64,729
For the fiscal year ending July 31, 2025	117,739
For the fiscal year ending July 31, 2026	106,480
For the fiscal year ending July 31, 2027	97,769
For the fiscal year ending July 31, 2028	90,398
For the fiscal year ending July 31, 2029 and thereafter	448,400
	$	925,515

Changes in the carrying amount of Goodwill by reportable segment for the six months ended January 31, 2024 are summarized as follows:


	North American Towable		North American Motorized		European		Other		Total
Net balance as of August 1, 2023	$	337,883	$	65,064	$	965,758	$	431,717	$	1,800,422
Fiscal 2024 activity:
Goodwill acquired	—		—		—		3,635		3,635

Foreign currency translation	—		—		(16,296)		—		(16,296)

Net balance as of January 31, 2024	$	337,883	$	65,064	$	949,462	$	435,352	$	1,787,761

Changes in the carrying amount of Goodwill by reportable segment for the six months ended January 31, 2023 are summarized as follows:


	North American Towable		North American Motorized		European		Other		Total
Net balance as of August 1, 2022	$	344,975	$	53,875	$	893,383	$	511,918	$	1,804,151
Fiscal 2023 activity:
Goodwill acquired	4,097		—		—		—		4,097
Measurement period adjustments	—		—		—		4,682		4,682
Foreign currency translation	—		—		55,729		—		55,729
Deconsolidation of Roadpass Digital	—		—		—		(84,883)		(84,883)
Net balance as of January 31, 2023	$	349,072	$	53,875	$	949,112	$	431,717	$	1,783,776

8. Equity Investments

As discussed in Note 8 to the Company’s Consolidated Financial Statements included in the Fiscal 2023 Form 10-K, effective December 30, 2022, the Company formed a joint venture with TechNexus Holdings LLC (“TechNexus”), whereby the Company transferred TH2Connect, LLC d/b/a Roadpass Digital and its associated legal entities to TN-RP Holdings, LLC (“TN-RP”), following which the Company and TechNexus own 100% of the Class A-RP units and Class C-RP units, respectively, issued by TN-RP.

TN-RP is a variable interest entity (“VIE”), in which both the Company and TechNexus each have a variable interest. The Company’s equity interest, which entitles the Company to a share of future distributions from TN-RP, represents a variable interest. The Company has significant influence due to its Class A-RP unit ownership interest, non-majority seats on the TN-RP advisory board and certain protective rights, and therefore the Company’s investment in TN-RP is accounted for under the equity method of accounting and reported as a component of Equity investments in the Condensed Consolidated Balance Sheets. Similarly, the Company holds an additional investment that is also a VIE over which the Company has significant influence. This is also reported as a component of Equity investments in the Condensed Consolidated Balance Sheets.

The Company had the following aggregate investment and maximum exposure to loss related to these VIEs:


	January 31, 2024		July 31, 2023
Carrying amount of investments	$	128,572	$	126,909
Maximum exposure to loss	$	145,622	$	161,459

The Company’s share of gains and losses accounted for under the equity method of accounting are included in Other income, net in the Condensed Consolidated Statements of Income and Comprehensive Income. The losses recognized in the three and six months ended January 31, 2024 were $3,502 and $9,437, respectively, and the amounts recognized in the three and six months ended January 31, 2023 were not material.

9. Concentration of Risk

One dealer, FreedomRoads, LLC, accounted for 15% of the Company’s consolidated net sales for the three-month period ended January 31, 2024 and 14% of the Company’s consolidated net sales for the three-month period ended January 31, 2023, and accounted for 14% of the Company’s consolidated net sales for both the six-month periods ended January 31, 2024 and January 31, 2023. The majority of the sales to this dealer are reported within the North American Towable and North American Motorized segments. This dealer also accounted for 17% of the Company’s consolidated trade accounts receivable at January 31, 2024 and 13% at July 31, 2023. The loss of this dealer could have a material effect on the Company’s business.

10. Fair Value Measurements

The financial assets and liabilities using a three-level hierarchy as prescribed in ASC 820, “Fair Value Measurements and Disclosures”, and as discussed in Note 9 in the Notes to the Consolidated Financial Statements in our fiscal 2017 Form~~10-K.~~

~~The financial assets~~ that ~~were~~are accounted for at fair value on a recurring basis at January 31, ~~2018~~2024 and July 31, ~~2017, all using Level 1 inputs,~~2023 are as follows:

   January 31, 2018    July 31, 2017
Cash equivalents
   $ 47,258    $ 176,663
Deferred compensation plan assets
   $ 36,776    $ 28,095


	Input Level	January 31, 2024		July 31, 2023
Cash equivalents	Level 1	$	194,454	$	286,984
Deferred compensation plan mutual fund assets	Level 1	$	42,042	$	40,220
Equity investments	Level 1	$	704	$	4,105

Foreign currency forward contract liability	Level 2	$	399	$	—

Interest rate swap liability	Level 2	$	1,110	$	932

Cash equivalents represent investments in ~~government and other~~short-term money market ~~funds traded in an active market, and~~instruments that are direct obligations of the U.S. Treasury and/or repurchase agreements backed by U.S. Treasury obligations. These investments are reported as a component of Cash and cash equivalents in the Condensed Consolidated Balance Sheets.

Deferred compensation plan assets ~~represent~~accounted for at fair value are investments in securities (primarily mutual funds) traded in an active market held for the benefit of certain employees of the Company as part of a deferred compensation ~~plan. Deferred compensation~~ plan, ~~asset balances~~which are ~~recorded as a component of~~reported within Other ~~long-term~~ assets in the Condensed Consolidated Balance Sheets. ~~An equal~~Additional plan investments in corporate-owned life insurance are recorded at their cash surrender value, not fair value, and ~~offsetting liability is also recorded~~therefore are not included above.

Equity investments represent stock investments that are publicly traded in ~~regards to the deferred compensation plan as a component of~~an active market and are reported within Other ~~long-term liabilities~~assets in the Condensed Consolidated Balance Sheets. ~~Changes in the~~

The fair value of foreign currency forward contracts is estimated by discounting the ~~plan assets~~difference between the contractual forward price and the ~~related liability are reflected in Other income, net and Selling, general and administrative expenses, respectively, in~~current available forward price for the ~~Condensed Consolidated Statements of Income and Comprehensive Income.~~

6.	~~Inventories~~

~~Major classifications of inventories are as follows:~~

      January 31, 2018    July 31, 2017
Finished goods – RV
   $ 54,722    $ 24,904
Finished goods – other
   34,177    27,862
Work in process
   144,714    117,319
Raw materials
   257,765    214,518
Chassis
   135,555    109,555




Subtotal
   626,933    494,158
Excess of FIFO costs over LIFO costs
   (36,570 )    (33,670 )




Total inventories, net
   $ 590,363    $ 460,488

~~Of the $626,933 and $494,158 of inventories at January 31, 2018 and July 31, 2017, $351,612 and $284,897, respectively, was valued on thelast-in,first-out~~ ~~(LIFO) basis, and $275,321 and $209,261, respectively, was valued on thefirst-in,first-out~~ ~~(FIFO) method.~~

7.	~~Property, Plant and Equipment~~

~~Property, plant and equipment is stated at cost, net of accumulated depreciation, and consists~~residual maturity of the ~~following:~~

   January 31, 2018    July 31, 2017
Land
   $ 53,045    $ 48,812
Buildings and improvements
   415,794    380,139
Machinery and equipment
   180,559    161,724




Total cost
   649,398    590,675
Less accumulated depreciation
   (183,183 )    (165,437 )




Property, plant and equipment, net
   $ 466,215    $ 425,238

~~Property, plant and equipment at both January 31, 2018 and July 31, 2017 includes buildings and improvements under capital leases~~contract using observable market rates.

The fair value of ~~$6,527 and related amortization included in accumulated depreciation of $1,496 and $1,224 at January 31, 2018 and July 31, 2017, respectively.~~

8.	~~Intangible Assets and Goodwill~~

~~The components of amortizable intangible assets are as follows:~~

   Weighted-Average
   Remaining    January 31, 2018    July 31, 2017
   Life in Years at    Cost    Accumulated    Cost    Accumulated
   January 31, 2018       Amortization       Amortization
Dealer networks/customer relationships
   16    $ 404,960    $ 124,519    $ 404,960    $ 101,795
Trademarks
   18    147,617    21,434    147,617    17,570
Design technology and other intangibles
   8    19,300    9,925    19,300    9,203
Non-compete agreements
   1    450    337    450    293








Total amortizable intangible assets
      $ 572,327    $ 156,215    $ 572,327    $ 128,861

~~Estimated annual amortization expense~~interest rate swaps is ~~as follows:~~

For the fiscal year ending July 31, 2018
   $ 55,118
For the fiscal year ending July 31, 2019
   50,043
For the fiscal year ending July 31, 2020
   46,194
For the fiscal year ending July 31, 2021
   42,860
For the fiscal year ending July 31, 2022
   37,753
For the fiscal year ending July 31, 2023 and thereafter
   211,498


   $ 443,466

Ofdetermined by discounting the ~~recorded goodwill of $377,693 at both January 31, 2018 and July 31, 2017, $334,822 relates to the towable recreational vehicle reportable segment and $42,871 relates to the othernon-reportable~~ ~~segment.~~

9.	~~Concentration of Risk~~

One dealer, FreedomRoads, LLC, accounted for 22% and 18% of the Company’s consolidated net sales for the six-month periods ended January 31, 2018 and January 31, 2017, respectively. Sales to this dealer are reported within both the towables and motorized segments. This dealer also accounted for 20% of the Company’s consolidated trade accounts receivable at January 31, 2018 and 30% at July 31, 2017. The loss of this dealer could have a significant effectestimated future cash flows based on the ~~Company’s business.~~

~~10.~~

~~Product Warranties~~

applicable observable yield curves.

11. Product Warranties

The Company generally provides retail customers of its products with aone-year ortwo-year warranty covering defects in material or workmanship, with longer warranties on certain structural components. The Company records a liability based on its best estimate of the amounts necessary to settle future and existing claims on products sold as of the balance sheet date. Factors used 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. Management believes that the recorded warranty liabilities are adequate, however, actual claims incurred could differ from estimates, requiring adjustments to the liabilities. Warranty liabilities are reviewed and adjusted as necessary on at least a quarterly basis.

Changes in our product warranty ~~reserves~~liability during the indicated periods are as follows:

   Three Months Ended
January 31,    Six Months Ended
January 31,
   2018    2017    2018    2017
Beginning balance
   $ 231,999    $ 208,988    $ 216,781    $ 201,840
Provision
   63,209    44,149    127,042    96,096
Payments
   (51,898 )    (43,964 )    (100,513 )    (88,763 )








Ending balance
   $ 243,310    $ 209,173    $ 243,310    $ 209,173


	Three Months Ended January 31,				Six Months Ended January 31,
	2024		2023		2024		2023
Beginning balance	$	333,274	$	325,713	$	345,197	$	317,908
Provision	66,478		72,356		140,913		161,781
Payments	(81,355)		(75,503)		(165,526)		(155,644)

Foreign currency translation	1,217		4,099		(970)		2,620

Ending balance	$	319,614	$	326,665	$	319,614	$	326,665

~~11.~~

~~Long-Term Debt~~

12. Long-Term Debt

The ~~Company has a five-year credit agreement, which was entered into on June 30, 2016 and matures on June 30, 2021. See~~components of long-term debt are as follows:


	January 31, 2024		July 31, 2023
Term loan	$	807,621	$	758,094
Asset-based credit facility	59,604		—
Senior unsecured notes	500,000		500,000
Unsecured notes	27,093		27,558
Other debt	35,468		41,753
Total long-term debt	1,429,786		1,327,405
Debt issuance costs, net of amortization	(22,083)		(24,726)
Total long-term debt, net of debt issuance costs	1,407,703		1,302,679
Less: Current portion of long-term debt	(17,234)		(11,368)
Total long-term debt, net, less current portion	$	1,390,469	$	1,291,311

As discussed in Note ~~11 in the Notes~~13 to the Company’s Consolidated Financial Statements included in ~~our~~the Fiscal 2023 Form 10-K, the Company is a party to a term loan (“term loan”) agreement, which consists of a U.S. dollar-denominated term loan tranche and a Euro-denominated term loan tranche, and a $1,000,000 revolving asset-based credit facility (“ABL”).

On November 15, 2023, the Company entered into amendments to both its term loan and ABL agreements to extend maturities and lower the applicable margins used to determine the interest rate on the U.S. dollar-denominated term loan tranche. Pursuant to the term loan amendments, the applicable margin used to determine the interest rate on U.S. dollar-denominated loans was reduced by 0.25% so that the applicable margin for Alternate Base Rate ("ABR")-based loans is 1.75% and 2.75% for Secured Overnight Financing Rate (“SOFR”)-based loans. The SOFR credit spread adjustment applicable to U.S. dollar-denominated SOFR-based loans was eliminated. The applicable margin for Euro-denominated EURIBOR-based loans was unchanged. The maturity date for the term loan was extended from February 1, 2026 to November 15, 2030. Covenants and other material provisions of the term loan agreement remain materially unchanged. Following the amendments, the principal amounts outstanding under the term loan agreement were $450,000 on the U.S. dollar-denominated term loan tranche and 330,000 Euro on the Euro-denominated term loan tranche. Under the provisions of the amended term loan, both the U.S. and Euro tranches require annual principal payments of 1.0% of the new term loan balance, payable quarterly in 0.25% installments starting on May 1, 2024. Pursuant to the ABL amendment, the maturity date for loans under the ABL agreement was extended from September 1, 2026 to November 15, 2028. Maximum availability under the ABL remains at $1,000,000 and there were no borrowings outstanding as of the November 15, 2023 amendment date. The applicable margin, covenants and other material provisions of the ABL remain materially unchanged.

The November 15, 2023 debt amendments noted above were evaluated on a creditor-by-creditor basis pursuant to the requirements in ASC 470-50 related to syndicated loan arrangements. Extinguishment accounting was applied to the creditors that were deemed to have a substantial difference in terms based on an analysis of the present values of cash flows before and after the amendments. As a result of this analysis, the Company recorded expense of $14,741 in the second quarter of fiscal ~~2017 Form10-K~~2024. $7,566 of this $14,741 expense is classified as interest expense in the Company’s Condensed Consolidated Statements of Income and Comprehensive Income and primarily represents extinguishment charges, while the remaining $7,175 is classified as administrative expense and primarily represents third-party costs attributed to the modified loans.In addition, during the second quarter of fiscal 2024 the Company capitalized qualifying financing-related costs of $10,480 related to these amendments which will be amortized over the remaining term of the amended agreements subject to acceleration for ~~details regarding the credit agreement. Borrowings outstanding on this facility totaled $80,000 at January 31, 2018 and $145,000 at July 31, 2017.~~ early term loan principal payments.

As of January 31, ~~2018,~~2024, the ~~available and unused credit line under~~outstanding U.S. term loan tranche balance of $450,000 was subject to a SOFR-based rate totaling 8.083%. As of July 31, 2023, the ~~revolver~~outstanding U.S. term loan tranche balance of $271,900 was ~~$417,675,~~subject to a SOFR-based rate totaling 8.433%. The interest rate on the January 31, 2024 outstanding Euro term loan tranche balance of $357,621 was 6.88%, and the ~~Company~~interest rate on the July 31, 2023 outstanding Euro term loan tranche of $486,194 was ~~in compliance with the financial covenant in the credit agreement.~~

~~For the three-month periods ended~~6.625%.

As of January 31, ~~2018 and January 31, 2017, the total interest expense on the facility was $547 and $1,826, respectively, and~~2024, the weighted-average interest rate on the outstanding ABL borrowings of $59,604 was 5.108%. As of July 31, 2023, there were no outstanding ABL borrowings. The Company may, generally at its option, pay any borrowings under the ABL, in whole or in part, at any time and from time to time, without penalty or premium.

Availability under the ~~facility was 2.70%~~ABL agreement is subject to a borrowing base based on a percentage of applicable eligible receivables and ~~2.23%, respectively.~~ eligible inventory. The unused availability under the ABL is generally available to the Company for general operating purposes and, based on January 31, 2024 eligible receivables and inventory balances, net of amounts drawn, totaled approximately $938,000.

As discussed in Note 13 to the Company’s Consolidated Financial Statements included in the Fiscal 2023 Form 10-K, on October 14, 2021, the Company issued an aggregate principal amount of $500,000 of 4.000% Senior Unsecured Notes (“Senior Unsecured Notes”) that will mature on October 15, 2029 unless redeemed or repurchased earlier. Interest on the Senior Unsecured Notes is payable in semi-annual installments on April 15 and October 15 of each year.

The unsecured notes of 25,000 Euro ($27,093) relate to long-term debt of our European segment. There are two series, 20,000 Euro ($21,674) with an interest rate of 1.945% maturing in March 2025, and 5,000 Euro ($5,419) with an interest rate of 2.534% maturing in March 2028. Other debt relates primarily to real estate loans with varying maturity dates through September 2032 and interest rates ranging from 2.38% to 2.87%.

Total contractual gross debt maturities are as follows:


For the remainder of the fiscal year ending July 31, 2024	$	7,532
For the fiscal year ending July 31, 2025	40,626
For the fiscal year ending July 31, 2026	11,201
For the fiscal year ending July 31, 2027	10,731
For the fiscal year ending July 31, 2028	16,215
For the fiscal year ending July 31, 2029 and thereafter	1,343,481
	$	1,429,786

For the~~six-month~~ ~~periods~~ three and six months ended January 31, ~~2018 and January 31, 2017, the total~~2024, interest expense on the ~~facility~~term loan, ABL, Senior Unsecured Notes and other debt facilities was ~~$1,158~~$30,548 and ~~$3,704,~~$53,747, respectively, which includes amortization of capitalized debt issuance costs and the ~~weighted-average interest rate on borrowings from~~debt extinguishment charges noted above totaling $8,992 and $11,864, respectively. For the ~~facility was 2.63%~~three and 2.19%, respectively. The Company incurred fees to secure the facility of $7,850 in fiscal 2016, and those fees are being amortized ratably over the five-year term of the agreement, or a shorter period if the credit agreement period is shortened for any reason. The Company recorded charges related to the amortization of these fees, which are classified as interest expense, of $392 for both the three-month periodssix months ended January 31, ~~2018~~2023, interest expense on the term loan, ABL and ~~January 31, 2017,~~other debt facilities was $26,926 and ~~$785 for both~~$49,940, respectively, which includes amortization of debt issuance costs of $2,862 and $5,697, respectively.

The fair value of the~~six-month~~ ~~periods ended January 31, 2018 and January 31, 2017. The unamortized balances of these facility fees were $5,364~~ Company’s Senior Unsecured Notes at January 31, ~~2018~~2024 and ~~$6,149 at~~ July 31, ~~2017,~~2023 was $444,950 and ~~are included in Other long-term assets in~~$430,650, respectively. The fair value of all other debt held by the ~~Condensed Consolidated Balance Sheets.~~

Company approximates carrying value. The ~~carrying value~~fair values of the Company’s long-term debt ~~at January 31, 2018 approximates fair value as the entire balance is subject to variable interest rates that the Company believes~~ are ~~market rates for a similarly situated company. The fair value of debt is largely~~primarily estimated using ~~level~~Level 2 inputs as defined by ASC ~~820.~~

~~12.~~

~~Provision for Income Taxes~~

820, based on quoted prices in markets that are not active.

13. Provision for Income Taxes

The overall effective income tax rate for the three months ended January 31, ~~2018~~2024 was 43.5% compared with 34.1% for the three months ended January 31, 2017. The primary reason for the increase in the effective income tax rate was the impact of the Tax Cuts and Jobs Act (the “Tax Act”) that was signed into law on December 22, 2017. Under the Tax Act, the federal corporate income tax rate has been reduced from 35.0% to 21.0% starting January 1, 2018, which results in the use of an estimated blended federal corporate income tax rate of 26.9% for the Company’s 2018 fiscal year. In addition, the Company was also required to revalue its net deferred tax assets to reflect the impact of the lower tax rates. This revaluation caused a~~non-recurring,non-cash~~ ~~reduction of the Company’s net deferred tax assets, and a corresponding charge to income tax expense, of approximately $34,000. This charge, with respect to the reduced federal income tax rate~~22.7%, and the potential impact of limitations on the deductibility of executive compensation, among other items, represents a provisional amount in accordance with SEC Staff Accounting Bulletin No. 118 (“SAB 118”) based on currently available information and is subject to further refinement during the measurement period as defined by SAB 118. The Company also recorded a tax benefit of $12,535 in the three months ended January 31, 2018 from applying the lower federal income tax rate for fiscal 2018 to the results of operations for the first quarter of fiscal 2018.

~~The overall~~ effective income tax rate for the six months ended January 31, ~~2018~~2024 was ~~36.6% compared with 33.0%~~24.0%. These rates were both favorably impacted by certain foreign tax rate differences which include certain interest income not subject to corporate income tax.

The overall effective income tax rate for the three months ended January 31, 2023 was 21.1%, and the effective income tax rate for the six months ended January 31, ~~2017. Income~~2023 was 23.0%. These rates were both favorably impacted by certain foreign rate differences and the mix of earnings between foreign and domestic operations which include certain interest income not subject to corporate income tax. The tax ~~expense~~rate for ~~the six months ended January 31, 2018 included approximately $34,000 of additional income tax expense resulting~~this six-month period includes an unfavorable impact from the ~~revaluation~~vesting of share-based compensation awards.

Within the ~~Company’s net deferred tax assets~~next 12 months, the Company does not anticipate any material changes in ~~connection with the Tax Act. Income tax expense for thesix-month~~ ~~period ended January 31, 2018 also reflects the use of the estimated blended federal corporate income tax rate of 26.9% as a result of the Tax Act.~~

~~The Company anticipates a decrease of approximately $2,730 in unrecognized tax benefits, and $370 in accrued interest related to~~its unrecognized tax benefits recorded as of January 31, ~~2018, within the next 12 months from expected settlements or payments of uncertain tax positions and lapses of the applicable statutes of limitations. Actual results may differ from these estimates.~~

~~Generally, fiscal years 2015 and 2016 remain open for federal~~2024.

The Company files income tax ~~purposes~~returns in the U.S. federal jurisdiction and ~~fiscal years 2013, 2014, 2015 and 2016 remain open for~~in many U.S. state and ~~Canadian income tax purposes. The Company and its subsidiaries file a consolidated U.S. federal income tax return and multiple state income tax returns.~~foreign jurisdictions. The Company is currently under ~~examination~~exam by certain ~~state authorities~~foreign jurisdictions for ~~the~~ fiscal years ended ~~July 31, 2013~~2016 through ~~2015.~~2021. The Company believes it has adequately reserved for its exposure to additional payments for uncertain tax positions ~~related to its state income tax returns~~ in its liability for unrecognized tax benefits.

~~13.~~

~~Contingent Liabilities, Commitments and Legal Matters~~

14. Contingent Liabilities, Commitments and Legal Matters

The Company’s total commercial commitments under standby repurchase obligations on global dealer inventory financing ~~as discussed in Note 13 in the Notes to the Consolidated Financial Statements in our fiscal 2017 Form10-K,~~were ~~$3,076,327~~$3,949,915 and ~~$2,200,544~~$3,893,048 as of January 31, ~~2018~~2024 and July 31, ~~2017,~~2023, respectively. The commitment term is generally up to ~~eighteen~~18 months.

The Company accounts for the guarantee under repurchase agreements of dealers’ financing by deferring a portion of the related product sale that represents the estimated fair value of the guarantee at inception. The estimated fair value takes into account an estimate of the losses that may be incurred upon resale of any repurchases. This estimate is based on recent historical experience supplemented by the Company’s assessment of current economic and other conditions affecting its dealers. This deferred amount is included in the repurchase and guarantee reserve balances of ~~$8,550~~$15,621 and ~~$6,345~~$12,114 as of January 31, ~~2018~~2024 and July 31, ~~2017,~~2023, respectively, which ~~are~~is included in Other current liabilities in the Condensed Consolidated Balance Sheets.

Losses incurred related to repurchase agreements that were settled during the ~~three-month periods~~three and six months ended January 31, ~~2018~~2024 totaled $2,892 and $6,060, respectively, and losses during the three and six months ended January 31, ~~2017~~2023 were not ~~significant.~~material. Based on current market conditions, the Company believes that any future losses under these agreements will not have a ~~significant~~material effect on the Company’s consolidated financial position, results of operations or cash flows.

The Company is also involved in certain litigation arising out of its operations in the normal course of its business, most of which is based upon state “lemon ~~laws”,~~laws,” warranty claims and vehicle accidents (for which the Company carries insurance above a specified self-insured retention or deductible amount). The outcomes of legal proceedings and claims brought against the Company are subject to significant uncertainty. There is significant judgment required in assessing both the probability of an adverse outcome and the determination as to whether an exposure can be reasonably estimated. Based on current conditions, ~~in management’s opinion~~management does not believe the ultimate disposition of any current legal proceedings or claims against the Company will ~~not~~ have a material effect on the Company’s financial condition, operating results or cash flows. Litigation is, however, inherently uncertain and an adverse outcome from such litigation could have a material effect on the operating results of a particular reporting period.

~~14.~~

~~Stockholders’ Equity~~

~~Under~~

A product recall was issued in late fiscal 2021 related to certain purchased parts utilized in certain of our products, and a reserve to cover anticipated costs was established at that time. Starting in fiscal 2022, the reserve has been adjusted quarterly based on developments involving the recall, including our expectations regarding the extent of vendor reimbursements and the estimated total cost of the recall. The Company has been, and will continue to be, reimbursed for a portion of the costs it will incur related to this recall. In addition, the Company accrued expenses during fiscal 2022 based on developments related to an ongoing investigation by certain German-based authorities regarding the adequacy of historical disclosures of vehicle weight in advertisements and other Company-provided literature in Germany. The Company is fully cooperating with the investigation. For the three and six months ended January 31, 2024, the Company recognized income of $4,200 and $14,200, respectively, as a component of selling, general and administrative expense from adjustments related to these matters. For the three months and six months ended January 31, 2023, the Company’s ~~restricted stock unit (“RSU”) program, as discussed in Note 16~~adjustments related to these two matters were not material. Based on current available information, the Company does not believe there will be a material adverse impact to our future results of operations and cash flows due to these matters.

15. Leases

The Company has operating leases principally for land, buildings and equipment, and has various finance leases for certain land and buildings expiring through 2035.

Certain of the Company’s leases include options to extend or terminate the leases, and these options have been included in the ~~Notes~~relevant lease term to the ~~Consolidated Financial Statements~~extent that they are reasonably certain to be exercised.

The Company does not include significant restrictions or covenants in our ~~fiscal 2017 Form10-K,~~ ~~RSU awards have been approved each October~~lease agreements, and residual value guarantees are not generally included within our operating leases.

The components of lease costs for the three and six-month periods ended January 31, 2024 and January 31, 2023 were as

follows:


	Three Months Ended January 31,				Six Months Ended January 31,
	2024		2023		2024		2023
Operating lease cost	$	7,628	$	7,584	$	15,639	$	14,463
Finance lease cost
Amortization of right-of-use assets	187		187		373		373
Interest on lease liabilities	78		100		161		205
Total lease cost	$	7,893	$	7,871	$	16,173	$	15,041

Other information related to ~~the financial performance~~leases was as follows:


	Six Months Ended January 31,
Supplemental Cash Flows Information	2024		2023
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	15,593	$	14,405
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	2,108	$	12,464


Supplemental Balance Sheet Information	January 31, 2024		July 31, 2023
Operating leases:
Operating lease right-of-use assets	$	43,741	$	47,969

Operating lease liabilities:
Other current liabilities	$	10,713	$	11,238
Other long-term liabilities	33,197		36,775
Total operating lease liabilities	$	43,910	$	48,013

Finance leases:
Finance lease right-of-use assets	$	5,145	$	5,518

Finance lease liabilities:
Other current liabilities	$	804	$	754
Other long-term liabilities	2,307		2,722
Total finance lease liabilities	$	3,111	$	3,476


	January 31, 2024		July 31, 2023
Weighted-average remaining lease term:
Operating leases	9.4 years		9.3 years
Finance leases	3.3 years		3.8 years
Weighted-average discount rate:
Operating leases	4.8	%	4.7	%
Finance leases	9.7	%	9.7	%

Future minimum payments required under operating and finance leases as of the most recently completed fiscal year since October 2012. The awarded employee restricted stock units vest, and shares of common stock are issued, in equal installments on the first, second and third anniversaries of the date of grant. In addition, concurrent with the timing of the employee awards, the Nominating and Governance Committee of the Board of Directors (“Board”) has awarded restricted stock units to Board members that will vest, and shares of common stock will be issued, on the first anniversary of the date of the grant.

January 31, 2024 were as follows:


	Operating Leases		Finance Leases
For the remainder of the fiscal year ending July 31, 2024	$	8,838	$	532
For the fiscal year ending July 31, 2025	13,938		1,083
For the fiscal year ending July 31, 2026	9,924		1,107
For the fiscal year ending July 31, 2027	6,707		896
For the fiscal year ending July 31, 2028	4,309		59
For the fiscal year ending July 31, 2029 and thereafter	16,250		—
Total future lease payments	59,966		3,677
Less: Amount representing interest	(16,056)		(566)
Total reported lease liability	$	43,910	$	3,111

16. Stockholders’ Equity

Stock-based Compensation

Total stock-based compensation expense recognized in the three-month periods ended January 31, ~~2018~~2024 and January 31, ~~2017~~2023 for ~~these restricted stock unit~~stock-based awards totaled $9,246 and ~~other~~$8,543, respectively. Total stock-based compensation ~~was $4,413 and $3,154, respectively. Total~~ expense recognized in thesix-month periods ended January 31, ~~2018~~2024 and January 31, ~~2017~~2023 for ~~these restricted~~stock-based awards totaled $19,698 and $16,935, respectively.

Share Repurchase Program

As discussed in Note 17 to the Company’s Consolidated Financial Statements included in the Fiscal 2023 Form 10-K, on December 21, 2021, the Company’s Board of Directors authorized Company management to utilize up to $250,000 to purchase shares of the Company’s common stock ~~unit awards and other stock-based compensation was $8,731 and $5,892, respectively.~~

~~For~~through December 21, 2024. On June 24, 2022, the ~~restricted~~Board authorized Company management to utilize up to an additional $448,321 to repurchase shares of the Company’s common stock ~~units that vested during~~through July 31, 2025.

During the~~six-month~~ ~~periods~~ three months ended January 31, ~~2018 and January 31, 2017, portions of the vested shares awarded were withheld as treasury shares to cover the recipients’ estimated withholding taxes. Tax payments made by~~2024, the Company ~~related to these stock-based awards for~~did not purchase any shares of its common stock. During the six months ended January 31, ~~2018~~2024, the Company purchased 327,876 shares of its common stock, at various times in the open market, at a weighted-average price of $91.61 and held them as treasury shares at an aggregate purchase price of $30,037, all from the December 21, 2021 authorization. Since the inception of the initial December 21, 2021 authorization, the Company has purchased 2,821,651 shares of its common stock, at various times in the open market, at a weighted-average price of $84.05 and held them as treasury shares at an aggregate purchase price of $237,151.

As of January 31, ~~2017 totaled $7,657 and $4,572, respectively.~~

~~15.~~

~~Subsequent Event~~

~~On February 15, 2018,~~2024, the remaining amount of the Company's common stock that may be repurchased under the December 21, 2021 $250,000 authorization expiring on December 21, 2024 is $12,849. As of January 31, 2024, the remaining amount of the Company’s common stock that may be repurchased under the June 24, 2022 authorization expiring on July 31, 2025 is $448,321. As of January 31, 2024, the total remaining amount of the Company’s common stock that may be repurchased under these two authorizations is $461,170.

17. Revenue Recognition

The table below disaggregates revenue to the level that the Company ~~announced~~believes best depicts how the ~~formation~~nature, amount, timing and uncertainty of the Company’s revenue and cash flows are affected by economic factors. Other RV-related revenues shown below in the European Recreational Vehicle segment include sales related to accessories and services, new and used vehicle sales at owned dealerships and RV rentals. Performance obligations for all material revenue streams are recognized at a ~~joint venture with Tourism Holdings Limited~~point-in-time. Other sales relate primarily to component part sales to RV original equipment manufacturers and aftermarket sales through dealers and retailers, as well as aluminum extruded components.


	Three Months Ended January 31,				Six Months Ended January 31,
NET SALES:	2024		2023		2024		2023
Recreational vehicles
North American Towable
Travel Trailers	$	471,483	$	527,829	$	1,091,021	$	1,350,698
Fifth Wheels	259,485		301,922		585,401		796,859
Total North American Towable	730,968		829,751		1,676,422		2,147,557
North American Motorized
Class A	178,308		244,128		386,219		648,706
Class C	275,632		334,911		609,408		825,698
Class B	116,484		159,544		285,956		387,698
Total North American Motorized	570,424		738,583		1,281,583		1,862,102
Total North America	1,301,392		1,568,334		2,958,005		4,009,659
European
Motorcaravan	424,813		267,782		771,324		507,567
Campervan	244,724		227,136		466,333		366,302
Caravan	51,087		94,494		115,714		156,109
Other RV-related	61,670		57,526		137,124		121,262
Total European	782,294		646,938		1,490,495		1,151,240
Total recreational vehicles	2,083,686		2,215,272		4,448,500		5,160,899
Other	166,534		164,859		365,455		397,507
Intercompany eliminations	(42,851)		(33,496)		(105,827)		(103,687)
Total	$	2,207,369	$	2,346,635	$	4,708,128	$	5,454,719

18. Accumulated Other Comprehensive Income (Loss)

The components of other comprehensive income (loss) (“~~thl~~”OCI”) ~~called TH2. The Company and~~~~thl~~ ~~each have a 50% ownership position in TH2 and equal representation on the board of directors of TH2. The Company contributed cash totaling approximately $47,000 to TH2 in early March 2018 while~~~~thl~~ contributed various assets with a fair value of approximately $47,000. The Company’s investment in TH2 was funded entirely from cash on hand. In accordance with the operating agreement, TH2’s future capital needs, which are not expected to be material to the Company, will be funded proportionally by~~thl~~ and the ~~Company. The~~changes in the Company’s ~~investment~~accumulated other comprehensive income (loss) (“AOCI”) by component were as follows:


	Three Months Ended January 31, 2024
	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivatives		Other		AOCI, net of tax, Attributable to THOR		Non-controlling Interests		Total AOCI
Balance at beginning of period, net of tax	$	(128,835)	$	—	$	364	$	(128,471)	$	(3,305)	$	(131,776)
OCI before reclassifications	35,688		—		(111)		35,577		(61)		35,516
Income taxes associated with OCI before reclassifications (1)	—		—		—		—		—		—
Amounts reclassified from AOCI	—		—		—		—		—		—
Income taxes associated with amounts reclassified from AOCI	—		—		—		—		—		—
OCI, net of tax for the fiscal period	35,688		—		(111)		35,577		(61)		35,516
Balance at end of period, net of tax	$	(93,147)	$	—	$	253	$	(92,894)	$	(3,366)	$	(96,260)

	Three Months Ended January 31, 2023
	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivatives		Other		AOCI, net of tax, Attributable to THOR		Non-controlling Interests		Total AOCI
Balance at beginning of period, net of tax	$	(226,348)	$	1,479	$	1,171	$	(223,698)	$	(2,639)	$	(226,337)
OCI before reclassifications	128,352		(178)		(39)		128,135		25		128,160
Income taxes associated with OCI before reclassifications (1)	—		42		—		42		—		42
Amounts reclassified from AOCI	—		(691)		—		(691)		—		(691)
Income taxes associated with amounts reclassified from AOCI	—		166		—		166		—		166
OCI, net of tax for the fiscal period	128,352		(661)		(39)		127,652		25		127,677
Balance at end of period, net of tax	$	(97,996)	$	818	$	1,132	$	(96,046)	$	(2,614)	$	(98,660)


	Six Months Ended January 31, 2024
	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivatives		Other		AOCI, net of tax, Attributable to THOR		Non-controlling Interests		Total AOCI
Balance at beginning of period, net of tax	$	(68,911)	$	—	$	364	$	(68,547)	$	(2,583)	$	(71,130)
OCI before reclassifications	(24,236)		—		(111)		(24,347)		(783)		(25,130)
Income taxes associated with OCI before reclassifications (1)	—		—		—		—		—		—
Amounts reclassified from AOCI	—		—		—		—		—		—
Income taxes associated with amounts reclassified from AOCI	—		—		—		—		—		—
OCI, net of tax for the fiscal period	(24,236)		—		(111)		(24,347)		(783)		(25,130)
Balance at end of period, net of tax	$	(93,147)	$	—	$	253	$	(92,894)	$	(3,366)	$	(96,260)

	Six Months Ended January 31, 2023
	Foreign Currency Translation Adjustment		Unrealized Gain (Loss) on Derivatives		Other		AOCI, net of tax, Attributable to THOR		Non-controlling Interests		Total AOCI
Balance at beginning of period, net of tax	$	(183,453)	$	675	$	1,171	$	(181,607)	$	(2,205)	$	(183,812)
OCI before reclassifications	85,457		945		(39)		86,363		(409)		85,954
Income taxes associated with OCI before reclassifications (1)	—		(227)		—		(227)		—		(227)
Amounts reclassified from AOCI	—		(753)		—		(753)		—		(753)
Income taxes associated with amounts reclassified from AOCI	—		178		—		178		—		178
OCI, net of tax for the fiscal period	85,457		143		(39)		85,561		(409)		85,152
Balance at end of period, net of tax	$	(97,996)	$	818	$	1,132	$	(96,046)	$	(2,614)	$	(98,660)

(1)We do not recognize deferred taxes for a majority of the foreign currency translation gains and losses because we do not anticipate reversal in ~~TH2 will be accounted for under~~ the ~~equity method of accounting.~~

TH2 was formed to own, improve and sell innovative and comprehensive digital platforms throughout the world. TH2 will offer a variety of products focused on enhancing the enjoyment, safety, connectivity and convenience of RV ownership and use.

foreseeable future.

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

~~Unless~~

~~otherwise indicated, all dollar amounts are presented in thousands except per share data.~~

~~Forward Looking~~

Unless otherwise indicated, all U.S. Dollar and Euro amounts are presented in thousands except share and per share data.

Forward-Looking Statements

This report includes certain statements that are ~~“forward looking”~~“forward-looking” statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These ~~forward looking~~forward-looking statements are made based on management’s current expectations and beliefs regarding future and anticipated developments and their effects upon ~~Thor,~~THOR, and inherently involve uncertainties and risks. These ~~forward looking~~forward-looking statements are not a guarantee of future performance. We cannot assure you that actual results will not differ materially from our expectations. Factors which could cause materially different results include, among ~~others,~~others:

•the impact of inflation on the cost of our products as well as on general consumer demand;

•the effect of raw material and commodity price fluctuations, and/or raw material, commodity or chassis supply ~~restrictions,~~ constraints;

•the impact of war, military conflict, terrorism and/or cyber-attacks, including state-sponsored or ransom attacks;

•the impact of sudden or significant adverse changes in the cost and/or availability of energy or fuel, including those caused by geopolitical events, on our costs of operation, on raw material prices, on our suppliers, on our independent dealers or on retail customers;

•the dependence on a small group of suppliers for certain components used in production, including chassis;

•interest rates and interest rate fluctuations and their potential impact on the general economy and, specifically, on our profitability and on our independent dealers and consumers;

•the ability to ramp production up or down quickly in response to rapid changes in demand while also managing costs and market share;

•the level and magnitude of warranty and recall claims ~~incurred,~~ incurred;

•the ability of our suppliers to financially support any defects in their products;

•legislative, regulatory and tax law (including recent and pending tax-law changes implementing new, widely adopted "Pillar II" tax principles) and/or policy developments including their potential impact on our independent dealers, ~~and their~~ retail customers or on our suppliers;

•the costs of compliance with governmental ~~regulation,~~ regulation;

•the impact of an adverse outcome or conclusion related to current or future litigation or regulatory investigations;

•public perception of and the costs related to environmental, social and governance matters;

•legal and compliance issues including those that may arise in conjunction with ~~recent transactions,~~ recently completed transactions;

•lower consumer confidence and the level of discretionary consumer ~~spending, interest rate fluctuations,~~ spending;

•the ~~potential~~ impact of ~~interest~~exchange rate ~~fluctuations on the general economy and specifically on our dealers and consumers,~~ fluctuations;

•restrictive lending practices which could negatively impact our independent dealers and/or retail consumers;

•management ~~changes,~~ changes;

•the success of new and existing products and ~~services,~~services;

•the ability to maintain strong brands and develop innovative products that meet consumer ~~preferences,~~demands;

•the ability to efficiently utilize existing production facilities;

•changes in consumer preferences;

•the risks associated with acquisitions, including: the pace ~~of obtaining~~ and ~~producing at new production facilities, the pace of acquisitions and the~~ successful closing of an acquisition, the integration and financial impact thereof, the level of achievement of anticipated operating synergies from acquisitions, the potential for unknown or understated liabilities related to acquisitions, the potential loss of existing customers of acquisitions ~~the integration of new acquisitions,~~and our ability to retain key management personnel of acquired ~~companies,~~ companies;

•a shortage of necessary personnel for production and increasing labor costs and related employee benefits to attract and retain production personnel in times of high demand;

•the loss or reduction of sales to key independent dealers, and stocking level decisions of our independent dealers;

•disruption of the ~~availability~~delivery of units to independent dealers or the disruption of delivery ~~personnel,~~ of raw materials, including chassis, to our facilities;

•increasing costs for freight and transportation;

•the ability to protect our information technology systems from data breaches, cyber-attacks and/or network disruptions;

•asset impairment ~~charges, cost structure changes, competition,~~ charges;

•competition;

•the impact of ~~potential~~ losses under repurchase ~~agreements,~~ agreements;

•the ~~potential~~ impact of the strength of the U.S. dollar on international demand for products priced in U.S. dollars;

•general economic, market, public health and political conditions in the various countries in which our products are produced and/or sold;

•the impact of changing emissions and other related climate change regulations in the various jurisdictions in which our products are produced, used and/or sold;

•changes to our investment and capital allocation strategies or other facets of our strategic ~~plan,~~plan; and

•changes in market liquidity conditions, credit ratings and other factors that may impact our access to future funding and the cost of debt.

These and other risks and uncertainties are discussed more fully in ~~ITEM~~Item 1A of our Annual Report on Form10-K for the year ended July 31, ~~2017.~~

2023.

We disclaim any obligation or undertaking to disseminate any updates or revisions to any ~~forward looking~~forward-looking statements contained in this report or to reflect any change in our expectations after the date hereof or any change in events, conditions or circumstances on which any statement is based, except as required by law.

Executive Overview

We were founded in 1980 and have grown to bebecome the largest manufacturer of recreational vehicles (“RVs”) in the world based on units sold and revenue. We are also the largest manufacturer of RVs in North ~~America. According~~America, and one of the largest manufacturers of RVs in Europe. In North America, according to Statistical Surveys, Inc. (“Stat Surveys”), for the calendar year ended December 31, ~~2017, Thor’s~~2023, THOR’s combined U.S. and Canadian market share was approximately ~~50.4%~~41.8% for travel trailers and fifth wheels combined and approximately ~~39.1%~~48.7% for motorhomes. In Europe, according to the European Caravan Federation (“ECF”) and based on unit registrations for Europe's original equipment manufacturer (“OEM”) reporting countries, our European market share for the calendar year ended December 31, 2023 was approximately 20.9% for motorcaravans and campervans combined and approximately 18.2% for caravans.

Our business model includes decentralized operating units, and our RV products are primarily sold to independent,non-franchise dealers who, in turn, retail those products. The Company also sells component parts to both RV and other original equipment manufacturers, including aluminum extruded components, and sells aftermarket component parts through dealers and retailers. Our growth has been achieved both organically and bythrough acquisition, and our strategy is designed to increase our profitability by driving innovation, servicing our customers, manufacturing quality products, improving the efficiencies of our facilities and making strategic acquisitions.

We generally do not finance independent dealers directly, but we do provide repurchase agreements to the independent dealers’ floor plan lenders.

We generally have financed our growth ~~acquisitions.~~

~~Recent Events~~

~~Tax~~

~~Reform~~

~~On December 22, 2017,~~through a combination of internally generated cash flows from operations and, when needed, outside credit facilities. Ongoing supply chain challenges, particularly chassis issues within our European operations, have and could continue to impact our business and our consolidated financial results and financial position. In addition, the ~~Tax Cuts~~impact of ongoing inflation on consumer confidence, which historically has been highly correlated with RV retail sales, and ~~Jobs Act (the “Tax Act”), was signed into law. The Tax Act includes numerous changes to tax laws impacting business,~~ the most significant being a permanent reduction in the federal corporate income tax rate from 35.0% to 21.0%. The rate reduction took effect on January 1, 2018. As the Company’s 2018 fiscal year ends on July 31, 2018, the Company’s estimated federal corporate income tax rate for fiscal year 2018 will be prorated to a blended 26.9% rate, basedimpact of inflation on the ~~applicable tax~~availability of discretionary funds of our end consumers, combined with significantly higher interest rates ~~before and after the Tax Act~~compared to recent years impacting both our independent dealers and the ~~number~~end consumer, had a negative impact on demand for our products at both the wholesale and retail levels during the first half of ~~days~~fiscal 2024 and are expected to continue to impact the remainder of our fiscal year. These risks to our business are more fully described in Part 1, Item 1A of our Annual Report on Form 10-K for the fiscal year ended July 31, 2023.

Recent Events

Refinancing of Credit Agreements

On November 15, 2023, the Company entered into amendments to ~~which~~both its term loan and ABL agreements to extend maturities and lower the ~~two different rates applied.~~applicable margins used to determine the interest rate on the U.S. dollar-denominated loan tranche. The maturity date for the term loan was extended from February 1, 2026 to November 15, 2030. Covenants and other material provisions of the term loan agreement remain materially unchanged. Following the amendments, the principal amounts outstanding under the term loan agreement were $450,000 on the U.S. dollar-denominated term loan tranche and 330,000 Euro on the Euro-denominated term loan tranche. Under the provisions of the amended term loan, both the U.S. and Euro tranches require annual principal payments of 1.0% of the new term loan balance, payable quarterly in 0.25% installments starting on May 1, 2024. Pursuant to the ABL amendment, the maturity date for loans under the ABL agreement was extended from September 1, 2026 to November 15, 2028. Maximum availability under the ABL remains at $1,000,000 and the applicable margin, covenants and other material provisions of the ABL remain materially unchanged. As a result of ~~other Tax Act changes, the Company’s income tax rate for fiscal year 2019 will be negatively impacted by the repeal of the domestic production activities (“Code Section 199”) deduction~~these amendments and ~~limitations on the deductibility of executive compensation.~~

~~As a result of the reduction of the federal corporate income tax rate,~~associated maturity date extensions, the Company was required to perform a revaluation of its net deferred tax assets. Based on currently available information, the Company has performed a preliminary analysis of the impact of the Tax Act as of the enactment date and has recorded a~~non-recurring,non-cash~~ ~~reduction of its net deferred tax assets due to the reduced federal income tax rate, and a corresponding charge to income tax~~recognized total expense of ~~approximately $34,000~~$14,741 in the three months ended January 31, 2018. The Company’s revaluation of its net deferred tax assets, with respect to the reduced federal income tax rate and the potential impact of limitations on the deductibility of executive compensation, among other items, are subject to further refinement, review and clarification under the new law as additional information becomes available. In addition to the benefit of a lower income tax rate in the three months ended January 31, 2018, an income tax benefit of $12,535 was also recorded in the three months ended January 31, 2018 to reflect the benefit of applying the lower federal tax rate to the results of operations for the firstsecond quarter of fiscal ~~2018.~~

~~The reduction in the statutory US federal income tax rate is expected to positively impact the Company’s fiscal 2018 and future USafter-tax~~ earnings. The Company currently estimates an overall effective income tax rate between 27.0% and 29.0% for the remainder of fiscal year 2018, before consideration of any discrete tax items, as compared to an effective income tax rate of 32.7% for fiscal 2017. For fiscal 2019, after considering the lower federal income tax rate of 21.0%, an estimated blended state income tax rate, the elimination of the Code Section 199 deduction and the limitations on the deductibility of executive compensation, the Company currently estimates an overall effective income tax rate between 23.0% and 25.0%, before consideration of any discrete tax items.

While the Tax Act is expected to generate additional cash flow in the future, our main priorities for the use of current and future available cash generated from operations will continue to focus on funding our growth, both organically and through acquisitions, maintaining and growing our regular dividends over time, and reducing indebtedness. Strategic share repurchases or special dividends, as determined by the Company’s Board, will also continue to be considered. As a component of funding our growth, we anticipate making additional investments in our workforce through a variety of initiatives, including enhanced employee training and development programs and other initiatives that will be introduced in fiscal 2018 and fiscal 2019 and targeted to the varying needs of our individual operating entities.

~~Joint~~

~~Venture~~

~~On February 15, 2018, the Company announced the formation of a joint venture with Tourism Holdings Limited (“~~~~thl~~~~”) called TH2. The Company and~~~~thl~~ ~~each have a 50% ownership position in TH2 and equal representation on the board of directors of TH2. The Company contributed cash totaling approximately $47,000 to TH2 in early March 2018 while~~~~thl~~ contributed various assets with a fair value of approximately $47,000. The Company’s investment in TH2 was funded entirely from cash on hand. In accordance with the operating agreement, TH2’s future capital needs, which are not expected to be material to the Company, will be funded proportionally by~~thl~~ ~~and the Company. The Company’s investment in TH2 will be accounted for under the equity method of accounting.~~

2024.

Industry Outlook

— North America

The Company monitors industry conditions in the North American RV market ~~through the use~~using a number of resources including its own performance tracking and modeling. The Company also considers monthly wholesale shipment data as reported by the ~~Recreation Vehicle~~RV Industry Association (“RVIA”), which is typically issued on aone-month lag and represents manufacturers’ North American RV production and delivery to dealers. In addition, we ~~also~~ monitor monthly North American retail sales trends as reported by Stat Surveys, whose data is typically issued on amonth-and-a-half lag. The Company believes that monthly RV retail sales data is important as consumer purchases impact future dealer orders and ultimately our ~~production.~~

~~In correlation with current retail demand,~~production and net sales.

North American RV independent dealer inventory of ~~Thor~~our North American RV products as of January 31, ~~2018 increased 25.5%~~2024 decreased 27.6% to approximately ~~155,650~~87,800 units, compared to approximately ~~124,000~~121,300 units as of January 31, ~~2017. We~~2023. As of January 31, 2024, we believe ~~our~~North American dealer inventory levels for most products are ~~appropriate for seasonal consumer demand.~~

~~Thor’s~~generally at, or slightly higher than, the levels that dealers are comfortable stocking given the current retail sales levels and associated carrying costs. We believe dealers will continue to closely evaluate the unit stocking levels that they will elect to carry in future periods, which may be less than historical unit stocking levels, due to a combination of factors such as retail activity, RV wholesale prices as well as interest rates and other carrying costs.

THOR’s North American RV backlog as of January 31, ~~2018 increased $708,013,~~2024 decreased $1,092,226, or ~~33.9%~~36.4%, to ~~$2,798,357~~$1,908,889 compared to ~~$2,090,344~~$3,001,115 as of January 31, ~~2017.~~

2023. The decrease in backlog is primarily a result of a reduction in orders from dealers, which we believe is due to lower retail sales and dealer concerns over current interest costs and other carrying costs compared to the prior-year period.

North American Industry Wholesale Statistics

Key wholesale statistics for the North American RV industry, as reported by RVIA for the periods indicated, are as follows:

   U.S. and Canada Wholesale Unit
Shipments
   Calendar Year       %
   2017    2016    Increase    Change
Towable Units
   441,961    375,950    66,011    17.6
Motorized Units
   62,638    54,741    7,897    14.4







Total
   504,599    430,691    73,908    17.2


	U.S. and Canada Wholesale Unit Shipments
	Calendar Year		Increase	%
	2023	2022	(Decrease)	Change
North American Towable units	267,295	434,858	(167,563)	(38.5)
North American Motorized units	45,879	58,410	(12,531)	(21.5)
Total	313,174	493,268	(180,094)	(36.5)

In February 2024, RVIA releases calendar year unit shipment forecasts periodically throughout the calendar year, updating their prior forecast by factoring actual year-to-date wholesale and retail unit shipments and current economic indicators into their new forecast. We expect the next RVIAissued a revised forecast for calendar year ~~2018 will~~2024 wholesale unit shipments. Under the RVIA’s most likely scenario, towable and motorized unit shipments are projected to be ~~published in March 2018~~approximately 301,800 units and ~~will take into consideration~~48,300 units, respectively, for an annual total of approximately 350,100 units, up 11.8% from the ~~current~~2023 calendar year wholesale ~~and retail shipment trends, such as the 8,238 unit or 11.7% increase in retail registrations~~shipments. The RVIA’s most likely forecast for ~~the three months ended December 31, 2017 vs. the comparable prior-year period as reported by Stat Surveys.~~

calendar year 2024 of 350,100 total units could range from a lower estimate of approximately 334,700 total units to an upper estimate of approximately 365,500 total units.

North American Industry Retail Statistics

~~We believe that retail demand is the key to continued growth in the RV industry, and that annual RV industry wholesale shipments will generally be in line with annual retail sales going forward.~~

Key retail statistics for the North American RV industry, as reported by Stat Surveys for the periods indicated, are as follows:

   U.S. and Canada Retail Unit
Registrations
   Calendar Year       %
   2017    2016    Increase    Change
Towable Units
   408,309    365,773    42,536    11.6
Motorized Units
   56,963    50,281    6,682    13.3







Total
   465,272    416,054    49,218    11.8

U.S. and Canada Retail Unit Registrations
Calendar Year Increase %
2023 2022 (Decrease) Change
North American Towable units 334,250 399,815 (65,565) (16.4)
North American Motorized units 44,955 48,811 (3,856) (7.9)
Total 379,205 448,626 (69,421) (15.5)

Note: Data reported by Stat Surveys is based on official state and provincial records. This information is subject to adjustment, is continuously updated and is ~~continuously updated.~~

often impacted by delays in reporting by various states or provinces.

We believe that North American retail consumer interest remains high due to an ongoing interest in the RV lifestyle. While we anticipate that near-term demand will be influenced by many factors, including consumer confidence and the level of consumer spending on discretionary products, we believe future retail demand over the longer term will exceed historical, pre-pandemic levels as consumers continue to value the perceived benefits offered by the RV lifestyle, which provides people with the ability to connect with loved ones and nature as well as the potential to get away for short, frequent breaks or longer adventures.

Company North American Wholesale Statistics

The Company’s North American wholesale RV shipments, for the calendar years ended December 31, ~~2017~~2023 and ~~2016~~2022 to correspond to the North American industry wholesale periods noted above, were as ~~follows (includes Jayco results from the June 30, 2016 date of acquisition forward):~~

   U.S. and Canada Wholesale Unit
Shipments
   Calendar Year       %
   2017    2016    Increase    Change
Towable Units
   232,231    164,015    68,216    41.6
Motorized Units
   26,029    17,827    8,202    46.0







Total
   258,260    181,842    76,418    42.0

follows:

U.S. and Canada Wholesale Unit Shipments
Calendar Year Increase %
2023 2022 (Decrease) Change
North American Towable units 102,141 181,645 (79,504) (43.8)
North American Motorized units 21,416 29,643 (8,227) (27.8)
Total 123,557 211,288 (87,731) (41.5)

Company North American Retail Statistics

Retail statistics of the Company’s North American RV products, as reported by Stat Surveys, for the calendar years ended December 31, ~~2017~~2023 and ~~2016~~2022 to correspond to the North American industry retail periods noted above, ~~(and adjusted to include Jayco’s results from the June 30, 2016 date of acquisition forward)~~ were as follows:

   U.S. and Canada Retail Unit
Registrations
   Calendar Year       %
   2017    2016    Increase    Change
Towable Units
   200,931    150,566    50,365    33.5
Motorized Units
   22,283    15,986    6,297    39.4







Total
   223,214    166,552    56,662    34.0

~~Our outlook for future growth~~


	U.S. and Canada Retail Unit Registrations
	Calendar Year		Increase	%
	2023	2022	(Decrease)	Change
North American Towable units	135,648	163,575	(27,927)	(17.1)
North American Motorized units	21,906	23,633	(1,727)	(7.3)
Total	157,554	187,208	(29,654)	(15.8)

Note: Data reported by Stat Surveys is based on official state and provincial records. This information is subject to adjustment, is continuously updated and is often impacted by delays in ~~retail~~reporting by various states or provinces.

North American Outlook

Historically, RV industry sales ~~is dependent upon various~~have been impacted by a number of economic conditions faced by RV dealers, and ultimately retail consumers, such as the rate of unemployment, the rate of inflation, the level of consumer confidence, the ~~growth in~~ disposable income of consumers, ~~changes in~~ interest rates, credit availability, the health of the housing market, ~~and changes in~~ tax rates and fuel availability and prices. ~~With continued stability or improvement~~We believe these factors will continue to affect retail sales in ~~consumer confidence, availability of retail and wholesale credit, low~~2024. In addition, due to inflationary pressures, higher interest rates and ~~the absence of negative economic~~other factors, we ~~would~~believe that RV dealers will be continuously reevaluating their desired stocking levels, which may result in lower than historical dealer inventory stocking levels on a unit basis. It is difficult to predict the extent to which any or all of these factors will impact the RV industry or our business in a particular future period, however, we currently believe the remainder of our fiscal 2024 will continue to be negatively impacted by these factors.

Despite the near-term challenges, we remain optimistic about future growth in North American retail sales in the long term, as there are many factors driving product interest. Surveys conducted by THOR, RVIA and others show that Americans of all generations love the freedom of the outdoors and the enrichment that comes with living an active lifestyle. RVs allow people to be in control of their travel experiences, going where they want, when they want and with the people they want. The RV units we design, produce and sell allow people to spend time outdoors pursuing their favorite activities, creating cherished moments and deeply connecting with family and friends. Based on the on-going value consumers place on these factors, we expect to see ~~continued~~long-term growth in the North American RV industry.

A The growth in industry-wide RV sales during late 2020 through early 2023 has also resulted in exposing a wider range of consumers to the RV lifestyle. We believe many of those who have been recently exposed to the industry for the first time will become future owners, and that those who became first-time owners since the onset of the pandemic will become long-term RVers, resulting in future repeat and upgrade sales opportunities. We also believe many consumers are likely to continue opting for fewer vacations via air travel, cruise ships and hotels, while preferring vacations that RVs are uniquely positioned to provide, allowing consumers the ability to explore or unwind, often close to home. In addition, we believe that the availability of camping and RV parking facilities will be an important factor in the future growth of the industry and view both the significant recent investments and the future committed investments by campground owners, states and the federal government in camping facilities and accessibility to state and federal parks and forests to be positive long-term factors.

Economic and industry-wide factors that have historically affected, and which we believe will continue to affect, our operating results include the costs of commodities, the availability of critical supply components and labor costs incurred in the production of our products. Material and labor costs are the primary factors determining our cost of products sold, and any future increases in raw material or labor costs will impact our profit margins negatively if we are unable to offset those cost increases through a combination of product recontenting, material sourcing strategies, efficiency improvements or raising the selling prices for our products by corresponding amounts. Historically, we have generally been able to offset net cost increases over time.

It is extremely difficult to predict when or whether future supply chain issues related to chassis or other components used in the production of RVs will arise. Modifying available chassis for certain motorized products to use for other products is not a viable alternative, particularly in the short term, due to engineering requirements. The North American recreational vehicle industry has, from time to time in the past, experienced shortages of chassis for various reasons, including component shortages, production delays or other production issues and work stoppages at the chassis manufacturers.

While the North American RV industry has at times faced supply shortages or delivery delays of other, non-chassis raw material components, the supply chain is currently able to support our demand. If any factors were to impact our suppliers' ability to fully supply our needs for key components, our costs of such components and our production output could be adversely affected.

Industry Outlook — Europe

The Company monitors industry conditions in the European RV market using a number of resources including its own performance tracking and modeling. The Company also considers retail trends in the European RV market as reported by the European Caravan Federation (“ECF”) and its members. On a monthly basis, the Company receives original equipment manufacturer ("OEM")-specific reports for most of the individual member countries that make up the ECF through the Caravaning Industrie Verband e.V. (“CIVD”). The timing of these reports may vary, but typically they are issued on a one-to-two-month lag. While most countries provide OEM-specific information, the United Kingdom, which made up 20.7% and 8.3% of the caravan and motorcaravan (including campervans) European market for the calendar year ended December 31, 2023, respectively, does not provide OEM-specific information. Industry wholesale shipment data for the European RV market is not available.

Within Europe, over 90% of our sales are made to dealers within 10 different European countries. The market conditions, as well as the operating status of our independent dealers within each country, vary based on the various local economic and other conditions. It is inherently difficult to generalize about the operating conditions within the entire European region.

Independent dealer inventory of our European RV products as of January 31, 2024 was approximately 24,800 units. Independent RV dealer inventory levels of our European products are generally in line with historic levels in the various countries we serve. Within Germany, which accounts for approximately 60% of our European product sales, independent dealer inventory levels are also generally in line with historical norms. Comparable independent dealer inventory unit information was not available as of January 31, 2023.

THOR’s European RV backlog as of January 31, 2024 decreased $309,431, or 10.1%, to $2,746,307 compared to $3,055,738 as of January 31, 2023, primarily due to improved chassis supply availability as chassis constraints in the prior year resulted in elevated backlogs.

European Industry Retail Statistics

Key retail statistics for the European RV industry, as reported by the ECF for the periods indicated, are as follows:


	European Unit Registrations
	Motorcaravan and Campervan (2)			Caravan
	Calendar Year		%	Calendar Year		%
	2023	2022	Change	2023	2022	Change
OEM Reporting Countries (1)	129,269	130,849	(1.2)	47,740	54,565	(12.5)
Non-OEM Reporting Countries (1)	17,070	16,955	0.7	16,011	16,980	(5.7)
Total	146,339	147,804	(1.0)	63,751	71,545	(10.9)

(1)Industry retail registration statistics have been compiled from individual countries' reporting of retail sales, and include the following countries: Germany, France, Sweden, Netherlands, Norway, Italy, Spain and others, collectively the “OEM Reporting Countries.” The “Non-OEM Reporting Countries” are primarily the United Kingdom and others. Total European unit registrations are reported quarterly by the ECF.

(2)The ECF reports motorcaravans and campervans together.

Note: Data from the ECF is subject to adjustment, is continuously updated and is often impacted by delays in reporting by various countries. (The "Non-OEM Reporting Countries" either do not report OEM-specific data to the ECF or do not have it available for the entire time period covered).

Company European Retail Statistics (1)


	European Unit Registrations (1)
	Calendar Year		Increase	%
	2023	2022	(Decrease)	Change
Motorcaravan and Campervan	27,005	27,664	(659)	(2.4)
Caravan	8,704	10,075	(1,371)	(13.6)
Total OEM-Reporting Countries	35,709	37,739	(2,030)	(5.4)

(1)Company retail registration statistics have been compiled from individual countries reporting of retail sales, and include the following countries: Germany, France, Sweden, Netherlands, Norway, Italy, Spain and others, collectively the “OEM Reporting Countries.”

Note: Data from the ECF is subject to adjustment, is continuously updated and is often impacted by delays in reporting by various countries.

European Outlook

Our European operations offer a full lineup of leisure vehicles including caravans and motorized products including urban vehicles, campervans and small-to-large motorcaravans. Our product offerings are not limited to vehicles only but also include accessories and services, including vehicle rentals. We address European retail customers through a sophisticated brand management approach based on consumer segmentation according to target group, core values and emotions. With the help of data-based and digital marketing, we intend to continue expanding our retail customer reach to new and younger consumer segments.

The impact of current macroeconomic factors on our business, including inflation and interest rates, supply chain constraints, environmental and sustainability regulations and geopolitical events, is uncertain. Our outlook for future European RV retail sales depends upon the various economic and regulatory conditions in the respective countries in which we sell our products, and on our ability to manage through supply chain issues that have, and are expected to continue to, impact the efficiency of our production of our motorized products in the near term. End-customer demand for RVs depends strongly on consumer confidence. Factors such as the rate of unemployment, the rate of inflation, private consumption and investments, the level of disposable income of consumers, interest rates, the health of the housing market, tax rates and regulatory restrictions and, since the pandemic, travel safety considerations all influence retail sales. Our long-term outlook for future growth in European RV ~~segment is supported by favorable demographics,~~retail sales remains positive as more people reach the age brackets that historically have accounted for the bulk of retail RV sales. The number of consumers between the ages of 55 and 74 will total 79 million by 2025, 15% higher than in 2015 according to the RVIA. In addition, in recent years the industry has benefited from growing retail sales to younger consumers with new product offerings targeted to younger, more active families, as they place a higher value on family outdoor recreation than any prior generation. Based on a study from the Pew Research Center, the “Millennial” generation, defined as those between the ages of 18 and 34, consisted of more than 75 million people in 2015. In general, these consumers are more technologically savvy, but still value active outdoor experiences shared with family and friends, making them strong potential customers for our industry in the decades to come. Based on the Kampgrounds of America (KOA) 2017 North American Camping Report, their millennial group comprised 31% of the total population in the most recent census, yet accounted for 38% of the total campers in 2016, which increased from 34% of the total campers in 2015. Younger RV consumers are generally attracted to lower and moderately-priced travel trailers, as affordability is a key driver at this stage in their lives.

As the first generation of the internet age, Millennials are generally more comfortable gathering information online, and are therefore generally more knowledgeable about products and competitive pricing than any prior generation. This generation is camping more as they view camping as an opportunity to spend time with family and friends as welldiscover RVs as a way to ~~reduce stress,~~support their lifestyle in search of independence and individuality, as well as using the RV as a multi-purpose vehicle to escape urban life and explore outdoor activities and nature.

We and our independent European dealers market our European recreational vehicles through multiple avenues including at numerous RV fairs at the ~~pressures~~country and regional levels which occur throughout the calendar year. These fairs have historically been well-attended events that allow retail consumers the ability to see the newest products, features and designs and to talk with product experts in addition to being able to purchase or order an RV. The most recent 2023 Caravan Salon show in late August 2023 experienced near-record attendance, demonstrating the high level of ~~everyday life, be more active and lead a healthier lifestyle.~~interest in the RV lifestyle despite the current macroeconomic uncertainties facing many consumers. In addition to ~~younger age demographics, there are opportunities to expand sales to a more ethnically diverse customer base. In~~ our ~~efforts to connect with RV consumers of all generations, beginning in the first quarter of fiscal 2017~~attendance at various strategic trade fairs, we ~~launched a new consumer-facing website designed to inspire consumers to explore the RV lifestyle. The new website includes video~~have and interactive features to help consumers determine the type of RV which may suit their specific camping needs, while providing video footage that can be utilized by dealers to market our products. In the second quarter of fiscal 2018, we launched a targeted campaign towards Millennials, and have begun exploring related marketing opportunities. We will continue to ~~consider additional marketing opportunities~~strengthen and expand our digital activities to ~~younger~~reach high potential target groups, generate leads and ~~more diverse consumers over the remainder~~steer customers directly to dealerships. With approximately 1,100 active independent dealers in Germany and throughout Europe with whom we do business, we believe our European brands have one of the ~~year. We anticipate our recent formation of the joint venture TH2, as discussed~~strongest and most professionally structured dealer and service networks in ~~Note 15 to the Condensed Consolidated Financial Statements, will further enhance the RV value proposition and ownership experience for this younger, more technically savvy customer group.~~

Europe.

Economic or industry-wide factors affecting our European RV ~~business~~operating results include the availability and costs of commodities and component parts and the labor used in the manufacture of our products. Material and labor costs are the primary factors determining our cost of products sold and any future increases in ~~raw material or labor~~these costs ~~would~~will impact our profit margins negatively if we ~~were~~are unable to ~~raise~~offset those cost increases through a combination of product recontenting, material sourcing strategies, efficiency improvements or raising the selling prices for our products by corresponding amounts. ~~Historically,~~

Throughout fiscal 2023, we ~~have been able~~experienced delays in the receipt of, and significant reductions in the volume of, chassis from our European chassis suppliers, limiting our ability to ~~pass along those~~further increase production of our motorized products. While overall chassis supply has improved, we anticipate disruptions in the sequence of delivery of chassis to continue through the majority of calendar year 2024. The sequence of chassis supply inhibits our ability to efficiently and consistently maintain our planned production levels. Uncertainties related to changing emission standards may also impact the availability of chassis used in our production of certain European motorized RVs and could also impact consumer buying patterns.

In Europe, we also continue to experience cost increases, supply shortages and delivery delays of other, non-chassis raw material components which negatively impacted the efficiency of our production in the current fiscal year, and which resulted in the continuation of an elevated level of work in process inventory on hand compared to ~~customers.~~

historical norms. We ~~have not experienced any recent unusual cost increases or supply constraints from our chassis suppliers. The recreational vehicle industry has, from time~~believe these shortages and delays will continue to ~~time, experienced shortages~~result in production inefficiencies and a continuation of ~~chassis for various reasons, including component shortages, production delays and~~the elevated level of work ~~stoppages at~~in process inventory in the ~~chassis manufacturers. These shortages~~near term, which will have ~~had~~ a negative impact on our ~~sales~~European operating results as well as on our consolidated results due to the negative impact of carrying excess inventory levels and ~~earnings~~the negative impact of completing units off the production line.

Where possible, to minimize the future impact of supply chain constraints, we have identified a second-source supplier base for certain component parts, however, the engineering requirements required with an alternate component part, particularly the chassis our various units are built upon, limits the impact of these alternative suppliers on reducing any near-term supply constraints.

In addition to potential material supply constraints, labor shortages may also impact our European operations. Currently, we are experiencing a shortage of available skilled workers due to near full employment rates in the ~~past. We believe that~~European countries where the ~~current supply~~majority of ~~chassis used in~~ our ~~motorized RV production is adequate for current production levels, and that available inventory would compensate for short-term changes in supply schedules if they occur.~~

manufacturing sites are located.

Three Months Ended January 31, ~~2018~~2024 Compared to the Three Months Ended January 31, ~~2017~~

   Three Months Ended
January 31, 2018    Three Months Ended
January 31, 2017    Change
Amount %
Change
NET SALES:

Recreational vehicles

Towables
   $ 1,373,118    $ 1,082,249    $ 290,869 26.9
Motorized
   559,909    474,972    84,937 17.9






Total recreational vehicles
   1,933,027    1,557,221    375,806 24.1
Other
   68,013    53,891    14,122 26.2
Intercompany eliminations
   (29,480 )    (22,587 )    (6,893 ) (30.5 )






Total
   $ 1,971,560    $ 1,588,525    $ 383,035 24.1






# OF UNITS:

Recreational vehicles

Towables
   55,346    45,754    9,592 21.0
Motorized
   6,735    5,831    904 15.5






Total
   62,081    51,585    10,496 20.3






GROSS PROFIT:    % of
Segment
Net
Sales    % of
Segment
Net
Sales    Change
Amount %
Change
Recreational vehicles

Towables
   $ 198,305 14.4    $ 151,767 14.0    $ 46,538 30.7
Motorized
   62,961 11.2    50,288 10.6    12,673 25.2






Total recreational vehicles
   261,266 13.5    202,055 13.0    59,211 29.3
Other, net
   9,062 13.3    9,647 17.9    (585 ) (6.1 )






Total
   $ 270,328 13.7    $ 211,702 13.3    $ 58,626 27.7






SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:


Recreational vehicles

Towables
   $ 70,367 5.1    $ 61,155 5.7    $ 9,212 15.1
Motorized
   24,309 4.3    20,868 4.4    3,441 16.5






Total recreational vehicles
   94,676 4.9    82,023 5.3    12,653 15.4
Other
   2,239 3.3    2,272 4.2    (33 ) (1.5 )
Corporate
   20,173 —      12,674 —      7,499 59.2






Total
   $ 117,088 5.9    $ 96,969 6.1    $ 20,119 20.7






INCOME (LOSS) BEFORE INCOME TAXES:


Recreational vehicles

Towables
   $ 116,728 8.5    $ 78,000 7.2    $ 38,728 49.7
Motorized
   37,538 6.7    28,488 6.0    9,050 31.8






Total recreational vehicles
   154,266 8.0    106,488 6.8    47,778 44.9
Other, net
   5,290 7.8    5,696 10.6    (406 ) (7.1 )
Corporate
   (18,491 ) —      (13,819 ) —      (4,672 ) (33.8 )






Total
   $ 141,065 7.2    $ 98,365 6.2    $ 42,700 43.4

ORDER BACKLOG:    As of
January 31, 2018    As of
January 31, 2017    Change
Amount    %
Change
Recreational vehicles

Towables
   $ 1,816,520    $ 1,323,451    $ 493,069    37.3
Motorized
   981,837    766,893    214,944    28.0







Total
   $ 2,798,357    $ 2,090,344    $ 708,013    33.9

2023


NET SALES:	Three Months Ended January 31, 2024		Three Months Ended January 31, 2023		Change Amount		% Change
Recreational vehicles
North American Towable	$	730,968	$	829,751	$	(98,783)	(11.9)
North American Motorized	570,424		738,583		(168,159)		(22.8)
Total North America	1,301,392		1,568,334		(266,942)		(17.0)
European	782,294		646,938		135,356		20.9
Total recreational vehicles	2,083,686		2,215,272		(131,586)		(5.9)
Other	166,534		164,859		1,675		1.0
Intercompany eliminations	(42,851)		(33,496)		(9,355)		(27.9)
Total	$	2,207,369	$	2,346,635	$	(139,266)	(5.9)


# OF UNITS:
Recreational vehicles
North American Towable	21,958	19,934	2,024	10.2
North American Motorized	4,438	5,438	(1,000)	(18.4)
Total North America	26,396	25,372	1,024	4.0
European	13,080	12,588	492	3.9
Total	39,476	37,960	1,516	4.0


GROSS PROFIT:			% of Segment Net Sales			% of Segment Net Sales	Change Amount		% Change
Recreational vehicles
North American Towable	$	53,897	7.4	$	52,863	6.4	$	1,034	2.0
North American Motorized	60,721		10.6	107,212		14.5	(46,491)		(43.4)
Total North America	114,618		8.8	160,075		10.2	(45,457)		(28.4)
European	119,325		15.3	91,430		14.1	27,895		30.5
Total recreational vehicles	233,943		11.2	251,505		11.4	(17,562)		(7.0)
Other, net	36,904		22.2	31,430		19.1	5,474		17.4
Total	$	270,847	12.3	$	282,935	12.1	$	(12,088)	(4.3)


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
Recreational vehicles
North American Towable	$	56,006	7.7	$	53,955	6.5	$	2,051	3.8
North American Motorized	30,792		5.4	42,418		5.7	(11,626)		(27.4)
Total North America	86,798		6.7	96,373		6.1	(9,575)		(9.9)
European	69,263		8.9	64,981		10.0	4,282		6.6
Total recreational vehicles	156,061		7.5	161,354		7.3	(5,293)		(3.3)
Other	19,049		11.4	16,293		9.9	2,756		16.9
Corporate	45,015		—	31,096		—	13,919		44.8
Total	$	220,125	10.0	$	208,743	8.9	$	11,382	5.5

INCOME (LOSS) BEFORE INCOME TAXES: Three Months Ended
January 31, 2024 % of
Segment
Net Sales Three Months Ended
January 31, 2023 % of
Segment
Net Sales Change
Amount %
Change
Recreational vehicles
North American Towable $ 661 0.1 $ (7,119) (0.9) $ 7,780 109.3
North American Motorized 26,460 4.6 61,544 8.3 (35,084) (57.0)
Total North America 27,121 2.1 54,425 3.5 (27,304) (50.2)
European 38,057 4.9 12,015 1.9 26,042 216.7
Total recreational vehicles 65,178 3.1 66,440 3.0 (1,262) (1.9)
Other, net 7,343 4.4 8,289 5.0 (946) (11.4)
Corporate (65,627) — (42,011) — (23,616) (56.2)
Total $ 6,894 0.3 $ 32,718 1.4 $ (25,824) (78.9)

ORDER BACKLOG: As of
January 31, 2024 As of
January 31, 2023 Change
Amount %
Change
Recreational vehicles
North American Towable $ 836,202 $ 1,152,991 $ (316,789) (27.5)
North American Motorized 1,072,687 1,848,124 (775,437) (42.0)
Total North America 1,908,889 3,001,115 (1,092,226) (36.4)
European 2,746,307 3,055,738 (309,431) (10.1)
Total $ 4,655,196 $ 6,056,853 $ (1,401,657) (23.1)

CONSOLIDATED

Consolidated net sales for the three months ended January 31, ~~2018 increased $383,035,~~2024 decreased $139,266, or ~~24.1%~~5.9%, compared to the three months ended January 31, ~~2017.~~ 2023. The decrease in consolidated net sales is primarily due to lower dealer and consumer demand in comparison to the prior-year period, primarily in the North American RV markets. Approximately 35.4% of the Company’s consolidated net sales for the quarter ended January 31, 2024 were transacted in a currency other than the U.S. dollar. The Company’s most material exchange rate exposure is sales in Euros. The decrease in consolidated net sales includes an increase of $26,558 from the change in currency exchange rates between the two periods. To determine this impact, net sales transacted in currencies other than U.S. dollars have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative period.

Consolidated gross profit for the three months ended January 31, ~~2018 increased $58,626,~~2024 decreased $12,088, or ~~27.7%~~4.3%, compared to the three months ended January 31, ~~2017.~~2023. Consolidated gross profit was ~~13.7%~~12.3% of consolidated net sales for the three months ended January 31, ~~2018~~2024 and ~~13.3%~~12.1% for the three months ended January 31, ~~2017.~~

2023. The decrease in consolidated gross profit was primarily due to the impact of the decrease in consolidated net sales while the slight increase in the consolidated gross profit percentage is due to the favorable impacts of selling price increases, stable material costs and cost-saving initiatives in the current-year quarter compared to the prior-year quarter.

Selling, general and administrative expenses for the three months ended January 31, ~~2018~~2024 increased ~~$20,119,~~$11,382, or ~~20.7%~~5.5%, compared to the three months ended January 31, ~~2017. Amortization of intangible assets expense for the three months ended January 31, 2018 decreased $1,483, or 9.7%, compared to the three months ended January 31, 2017,~~2023, primarily due to ~~lower dealer network amortization as compared~~third-party fees of $7,175 related to the ~~prior-year period. Income~~debt refinancing in the second quarter of fiscal 2024 as discussed in Note 12 to the Condensed Consolidated Financial Statements.

The decrease of $25,824, or 78.9%, in income before income taxes for the three months ended January 31, ~~2018 was $141,065,~~2024 as compared to ~~$98,365~~the three months ended January 31, 2023 was primarily driven by the decrease in consolidated net sales and the increase in consolidated selling, general and administrative expenses noted above.

The overall effective income tax rate for the three months ended January 31, ~~2017, an~~2024 was 22.7% compared with 21.1% for the three months ended January 31, 2023. The primary reason for the increase relates to the jurisdictional mix of ~~$42,700, or 43.4%.~~

pre-tax income between foreign and domestic operations between the comparable periods.

Additional information concerning the changes in net sales, gross profit, selling, general and administrative expenses and income before income taxes are addressed below and in the segment reporting that follows.

Corporate costs included in consolidated selling, general and administrative expenses increased ~~$7,499 to $20,173~~$13,919 for the three months ended January 31, ~~2018~~2024 compared to ~~$12,674~~the three months ended January 31, 2023. This increase includes an increase of $7,990 in legal and professional fees, including the debt financing-related third-party fees of $7,175 discussed above. This increase also includes an increase in deferred compensation expense of $5,231 due to market value fluctuations between the two periods, an increase in innovation-led research and development costs of $2,578 and an increase in stock-based and other compensation of $1,015. These increases were partially offset by $4,200 of income from adjustments made during the quarter related to certain legal and recall matters as discussed in Note 14 to the Condensed Consolidated Financial Statements.

Net expense in Corporate interest and other income and expense increased $9,697 for the three months ended January 31, ~~2017. The~~2024 compared to the three months ended January 31, 2023. This net expense increase ~~is due in part to~~included an increase in ~~compensation costs, as incentive compensation increased $761 in correlation with the increase in income before income taxes compared~~net interest expense of $1,336 on our debt, primarily due to extinguishment charges of $7,566 related to the ~~prior year, and stock-based compensation increased $1,259. The stock-based compensation increase is due to increasing income before income taxes over the past three years,~~refinancing of our debt facilities as most stock awards vest ratably over a three-year period. Deferred compensation expense also increased $1,419, which relates to the equal and offsetting increase in other income noted below due to the increase in the related deferred compensation plan assets. Legal and professional fees, including costs related to sales and marketing initiatives and the joint venture discussed in Note 1512 to the Condensed Consolidated Financial Statements more than offsetting increased ~~$2,541.~~

~~Corporate~~ interest income received from higher average cash balances held and ~~other~~higher interest income rates and lower debt interest expense ~~was $1,682~~primarily due to lower average debt balances outstanding. In addition, the current-year period included a non-cash foreign currency loss of ~~net income for the three months ended January 31, 2018~~$2,627 on certain Euro-denominated loans as compared to ~~$1,145~~a $6,923 gain in the prior-year period. The current-year period also included operating losses of ~~net expense for~~$3,502 related to our Roadpass Digital joint venture as discussed in Note 8 to the ~~three months ended January 31, 2017. This~~Condensed Consolidated Financial Statements. These increases were partially offset by a favorable change of $2,827 is partially due to interest expense and fees of $1,202 incurred in the current-year period related to the revolving credit facility, as compared to $2,325 in the prior-year period, a decrease of $1,123 primarily as a result of the lower outstanding debt balance. In addition, the change$5,156 in the fair value of the ~~Company’s~~Company's deferred compensation plan assets due to market fluctuations ~~and investment income resulted in $2,460 of net income in~~between the ~~current-year period as compared to net income of $1,041 in the prior-year period, an increase of $1,419.~~

The overall effective income tax rate for the three months ended January 31, 2018 was 43.5% compared with 34.1% for the three months ended January 31, 2017. The primary reason for the increase in the effective income tax rate was the impact of the Tax Cuts and Jobs Act (the “Tax Act”) that was signed into law on December 22, 2017. Under the Tax Act, the federal corporate income tax rate has been reduced from 35.0% to 21.0% starting January 1, 2018, which results in the use of an estimated blended federal corporate income tax rate of 26.9% for the Company’s 2018 fiscal year. As a result of the Tax Act, the Company was also required to revalue its net deferred tax assets to reflect the impact of the lower tax rates. This revaluation caused a~~non-recurring,non-cash~~ reduction of the Company’s net deferred tax assets, and a corresponding charge to income tax expense, of approximately $34,000. This charge was partially offset by the benefits of both the lower federal income tax rate for the three months ended January 31, 2018 and a tax benefit of $12,535 recorded in the three months ended January 31, 2018 from applying the lower federal income tax rate for fiscal 2018 to the results of operations for the first quarter of fiscal 2018.

two periods.

Segment Reporting

NORTH AMERICAN TOWABLE RECREATIONAL VEHICLES

Analysis of the change in net sales for the three months ended January 31, ~~2018~~2024 compared to the three months ended January 31, ~~2017:~~

   Three Months
Ended
January 31, 2018    % of
Segment
Net Sales    Three Months
Ended
January 31, 2017    % of
Segment
Net Sales    Change
Amount    %
Change
NET SALES:

Towables

Travel Trailers and Other
   $ 829,318    60.4    $ 653,524    60.4    $ 175,794    26.9
Fifth Wheels
   543,800    39.6    428,725    39.6    115,075    26.8











Total Towables
   $ 1,373,118    100.0    $ 1,082,249    100.0    $ 290,869    26.9











   Three Months
Ended
January 31, 2018    % of
Segment
Shipments    Three Months
Ended
January 31, 2017    % of
Segment
Shipments    Change
Amount    %
Change
# OF UNITS:

Towables

Travel Trailers and Other
   42,979    77.7    35,730    78.1    7,249    20.3
Fifth Wheels
   12,367    22.3    10,024    21.9    2,343    23.4











Total Towables
   55,346    100.0    45,754    100.0    9,592    21.0


~~Impact of Change in Product Mix and Price on Net Sales:~~	% ~~Increase~~
~~Towables~~
~~Travel Trailers and Other~~		~~6.6~~
~~Fifth Wheels~~		~~3.4~~
~~Total Towables~~		~~5.9~~

2023:


	Three Months Ended January 31, 2024		% of Segment Net Sales	Three Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
North American Towable
Travel Trailers	$	471,483	64.5	$	527,829	63.6	$	(56,346)	(10.7)
Fifth Wheels	259,485		35.5	301,922		36.4	(42,437)		(14.1)
Total North American Towable	$	730,968	100.0	$	829,751	100.0	$	(98,783)	(11.9)

	Three Months Ended January 31, 2024		% of Segment Shipments	Three Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
North American Towable
Travel Trailers	17,652		80.4	15,494		77.7	2,158		13.9
Fifth Wheels	4,306		19.6	4,440		22.3	(134)		(3.0)
Total North American Towable	21,958		100.0	19,934		100.0	2,024		10.2

IMPACT OF CHANGE IN PRODUCT MIX AND PRICE ON NET SALES:									% Change
North American Towable
Travel Trailers									(24.6)
Fifth Wheels									(11.1)
Total North American Towable									(22.1)

The ~~increase~~decrease in total ~~towables~~North American Towable net sales of ~~26.9%~~11.9% compared to the prior-year quarter resulted from a ~~21.0%~~10.2% increase in unit shipments and a ~~5.9% increase~~22.1% decrease in the overall net price per unit due to the combined impact of changes in product mix and price. The increase in unit shipments is primarily due to the heightened demand for the lower cost travel trailers units, which increased 13.9% over the prior-year quarter. According to statistics published by RVIA, for the three months ended January 31, ~~2018,~~2024, combined North American travel trailer and fifth wheel wholesale unit shipments increased ~~19.1%~~12.9% compared to the same period last year.

According to the most recently published statistics from Stat Surveys, for the three months ended December 31, 2023 and 2022, our North American market share for travel trailers and fifth wheels combined was 39.7% and 41.2%, respectively. Comparisons of Company shipments to industry shipments on a quarterly basis would not necessarily be indicative of the results expected for a full fiscal year.

The decreases in the overall net price per unit within both the travel trailer product line of 24.6% and the fifth wheel product line of 11.1% were primarily due to the combined impact of sales price reductions due to lower input costs, higher sales discounting levels and product mix changes trending toward more moderately-priced units as compared to the prior-year quarter.

North American Towable cost of products sold decreased $99,817 to $677,071, or 92.6% of North American Towable net sales, for the three months ended January 31, 2024 compared to $776,888, or 93.6% of North American Towable net sales, for the three months ended January 31, 2023. Changes in material, labor, freight-out and warranty costs comprised $91,773 of the $99,817 decrease in cost of products sold. Material, labor, freight-out and warranty costs as a combined percentage of North American Towable net sales decreased to 82.2% for the three months ended January 31, 2024 compared to 83.5% for the three months ended January 31, 2023, primarily due to a decrease in the material costs percentage from the combined favorable impacts of cost-saving initiatives and product mix changes. This decrease was partially offset by an increase in the labor percentage primarily due to product mix changes.

Total manufacturing overhead decreased $8,044 in correlation with the decrease in sales but increased as a percentage of North American Towable net sales from 10.1% to 10.4% as the decreased net sales levels resulted in higher overhead costs per unit sold.

The increase in North American Towable gross profit of $1,034 for the three months ended January 31, 2024 compared to the three months ended January 31, 2023 was due to the decrease in net sales being more than offset by the favorable impact of the decrease in the cost of products sold percentage noted above.

The increase in North American Towable selling, general and administrative expenses of $2,051 for the three months ended January 31, 2024 compared to the three months ended January 31, 2023 is primarily due to increases in costs related to our repurchase obligations of $2,085 and legal and professional fees of $1,845, partially offset by the decrease in North American Towable net sales and income before income taxes causing related commissions, incentive and other compensation to decrease by $1,538. The increase in the overall selling, general and administrative expense as a percentage of North American Towable net sales is primarily due to the decrease in net sales.

The increase in North American Towable income before income taxes of $7,780 for the three months ended January 31, 2024 compared to the loss before income taxes for the three months ended January 31, 2023 was primarily attributable to lower amortization costs and larger gains on the sales of fixed assets in the current-year quarter.

NORTH AMERICAN MOTORIZED RECREATIONAL VEHICLES

Analysis of the change in net sales for the three months ended January 31, 2024 compared to the three months ended January 31, 2023:


	Three Months Ended January 31, 2024		% of Segment Net Sales	Three Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
North American Motorized
Class A	$	178,308	31.3	$	244,128	33.1	$	(65,820)	(27.0)
Class C	275,632		48.3	334,911		45.3	(59,279)		(17.7)
Class B	116,484		20.4	159,544		21.6	(43,060)		(27.0)
Total North American Motorized	$	570,424	100.0	$	738,583	100.0	$	(168,159)	(22.8)

	Three Months Ended January 31, 2024		% of Segment Shipments	Three Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
North American Motorized
Class A	875		19.7	1,194		22.0	(319)		(26.7)
Class C	2,539		57.2	2,935		54.0	(396)		(13.5)
Class B	1,024		23.1	1,309		24.0	(285)		(21.8)
Total North American Motorized	4,438		100.0	5,438		100.0	(1,000)		(18.4)

IMPACT OF CHANGE IN PRODUCT MIX AND PRICE ON NET SALES:									% Change
North American Motorized
Class A									(0.3)
Class C									(4.2)
Class B									(5.2)
Total North American Motorized									(4.4)

The decrease in total North American Motorized net sales of 22.8% compared to the prior-year quarter resulted from a 18.4% decrease in unit shipments and a 4.4% decrease in the overall net price per unit due to the combined impact of changes in product mix and price, which included elevated sales discounts compared to the prior-year quarter. The decrease in unit shipments is primarily due to a softening in current dealer and consumer demand in comparison with the demand in the prior-year quarter, which included independent dealer restocking of certain motorized products. According to statistics published by RVIA, for the three months ended January 31, 2024, combined North American motorhome wholesale unit shipments decreased 15.8% compared to the same period last year. According to the most recently published statistics from Stat Surveys, for the three months ended December 31, 2023 and 2022, our North American market share for motorhomes was 47.3% for both periods. Comparisons of Company shipments to industry shipments on a quarterly basis would not necessarily be indicative of the results expected for a full fiscal year.

The decreases in the overall net price per unit within the ~~travel trailer and other~~Class A product ~~lines~~line of ~~6.6%~~0.3%, the Class C product line of 4.2% and the ~~fifth wheel~~Class B product ~~lines~~line of ~~3.4%~~5.2% were ~~both~~all primarily due to ~~changes in product mix and selective net price increases~~higher discounting levels since the prior-year quarter, and consumers trending toward more moderately-priced units compared to the prior-year quarter.

~~Cost~~

North American Motorized cost of products sold ~~increased $244,331~~decreased $121,668 to ~~$1,174,813,~~$509,703, or ~~85.6%~~89.4% of ~~towables~~North American Motorized net sales, for the three months ended January 31, ~~2018~~2024 compared to ~~$930,482,~~$631,371, or ~~86.0%~~85.5% of ~~towables~~North American Motorized net sales, for the three months ended January 31, ~~2017.~~2023. The changes in material, labor,freight-out and warranty costs comprised ~~$232,286~~$114,854 of the ~~$244,331 increase in cost of products sold.~~$121,668 decrease primarily due to the decreased net sales volume. Material, labor,freight-out and warranty costs as a combined percentage of ~~towables~~North American Motorized net sales increased ~~slightly~~ to ~~79.5%~~82.3% for the three months ended January 31, ~~2018~~2024 compared to ~~79.4%~~79.1% for the three months ended January 31, ~~2017. This~~2023, with the increase ~~in percentage was primarily the result of an increase in the labor cost percentage,~~ due to ~~the continued competitive RV labor market, and~~ an increase in the warranty cost percentage, which was partially due to offering extended coverage on certain structural components of certain products since the prior-year period. These increases in percentage were mostly offset by a decrease in the material cost percentage, ~~to net sales,~~primarily due to ~~selective~~higher sales discounting, which effectively decreases net ~~price increase~~selling prices and ~~operating efficiencies attained since~~correspondingly increases the ~~prior-year period, primarily by Jayco.~~ material cost percentage, as well as increased chassis costs.

Total manufacturing overhead ~~increased $12,045~~decreased $6,814 in correlation with the ~~increase in~~net sales decrease but ~~decreased~~increased as a percentage of ~~towables~~North American Motorized net sales from ~~6.6%~~6.4% to ~~6.1%,~~7.1% as the ~~increased production~~decrease in net sales levels resulted in ~~better absorption of fixed~~higher overhead ~~costs.~~

~~Towables~~costs per unit sold.

The decrease in North American Motorized gross profit ~~increased $46,538~~of $46,491 for the three months ended January 31, 2024 compared to ~~$198,305, or 14.4%~~the three months ended January 31, 2023 was driven by the decrease in net sales, and the decrease in the gross profit percentage is due to the increase in the cost of ~~towables~~products sold percentage noted above.

The decrease in North American Motorized selling, general and administrative expenses of $11,626 for the three months ended January 31, 2024 compared to the three months ended January 31, 2023 was primarily due to the decrease in North American Motorized net sales and income before income taxes, which caused related commissions, incentive and other compensation to decrease by $10,228. The decrease in commissions, incentive and other compensation also drove the slight decrease in the overall selling, general and administrative expense as a percentage of North American Motorized net sales.

The decrease in North American Motorized income before income taxes of $35,084 for the three months ended January 31, 2024 compared to the three months ended January 31, 2023 was primarily due to the decrease in North American Motorized net sales, and the primary reason for the decrease in percentage was the increase in the cost of products sold percentage noted above.

EUROPEAN RECREATIONAL VEHICLES

Analysis of the change in net sales for the three months ended January 31, ~~2018~~2024 compared to ~~$151,767,~~the three months ended January 31, 2023:


	Three Months Ended January 31, 2024		% of Segment Net Sales	Three Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
European
Motorcaravan	$	424,813	54.3	$	267,782	41.4	$	157,031	58.6
Campervan	244,724		31.3	227,136		35.1	17,588		7.7
Caravan	51,087		6.5	94,494		14.6	(43,407)		(45.9)
Other	61,670		7.9	57,526		8.9	4,144		7.2
Total European	$	782,294	100.0	$	646,938	100.0	$	135,356	20.9

	Three Months Ended January 31, 2024		% of Segment Shipments	Three Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
European
Motorcaravan	5,563		42.5	3,632		28.9	1,931		53.2
Campervan	5,382		41.1	4,826		38.3	556		11.5
Caravan	2,135		16.4	4,130		32.8	(1,995)		(48.3)
Total European	13,080		100.0	12,588		100.0	492		3.9


IMPACT OF CHANGES IN FOREIGN CURRENCY, PRODUCT MIX AND PRICE ON NET SALES:

	Foreign Currency %	Mix and Price %	% Change

European
Motorcaravan	4.1	1.3	5.4
Campervan	4.1	(7.9)	(3.8)
Caravan	4.1	(1.7)	2.4
Total European	4.1	12.9	17.0

The increase in total European Recreational Vehicle net sales of 20.9% compared to the prior-year quarter resulted from a 3.9% increase in unit shipments and a 17.0% increase in the overall net price per unit due to the total combined impact of changes in foreign currency, product mix and price. The increase in European Recreational Vehicle net sales of $135,356 includes an increase of $26,558, or ~~14.0%~~4.1%, due to the increase in foreign exchange rates since the prior-year quarter.

The overall net price per unit increase of ~~towables~~17.0% includes a 4.1% increase due to the impact of foreign currency exchange rate changes and a 12.9% increase due to the combined impact of product mix and selling prices, primarily due to the much higher concentration of Motorcaravan sales in the current-year quarter due to improved chassis supply and fewer other component constraints in the current-year quarter.

The constant-currency increase in the overall net price per unit within the Motorcaravan product line of 1.3% was primarily due to the impact of selling price increases and product mix changes. The constant-currency decreases in the overall net price per unit within the Campervan product line of 7.9% and the Caravan product line of 1.7% are primarily due to product mix changes and increased sales discounting. In addition, the current-year quarter included a higher concentration of Campervan units with a customer-supplied chassis that is not included in the unit sales price as opposed to a purchased chassis that is included in the unit sales price.

European Recreational Vehicle cost of products sold increased $107,461 to $662,969, or 84.7% of European Recreational Vehicle net sales, for the three months ended January 31, ~~2017.~~2024 compared to $555,508, or 85.9% of European Recreational Vehicle net sales, for the three months ended January 31, 2023. Changes in material, labor, freight-out and warranty costs comprised $92,861 of the $107,461 increase. Material, labor, freight-out and warranty costs as a combined percentage of European Recreational Vehicle net sales decreased to 73.6% for the three months ended January 31, 2024 compared to 74.8% for the three months ended January 31, 2023, with the decrease primarily due to a decrease in the material cost percentage due to net selling price increases and product mix changes. The labor cost percentage also improved. Total manufacturing overhead increased $14,600 with the increase in net sales but remained constant as a percentage of European Recreational Vehicle net sales at 11.1%.

European Recreational Vehicle gross profit isincreased $27,895 for the three months ended January 31, 2024 compared to the three months ended January 31, 2023 primarily due to the ~~21.0%~~ increase in ~~unit~~European Recreational Vehicle net sales, ~~volume noted above, while~~and the increase in the gross profit percentage is due to the decrease in the cost of products sold percentage noted above.

~~Selling,~~

European Recreational Vehicle selling, general and administrative expenses ~~were $70,367, or 5.1% of towables net sales,~~increased $4,282 for the three months ended January 31, ~~2018~~2024 compared to ~~$61,155, or 5.7% of towables net sales, for~~ the three months ended January 31, ~~2017. The primary reason for~~2023 primarily due to the ~~$9,212~~ increase ~~was increased towables net sales and towables income before income taxes, which caused related commissions, bonuses and other compensation to increase by $8,864. Sales-related~~in sales-related travel, advertising and promotional costs ~~also increased $1,041~~of $2,019 in correlation with the ~~sales increase. These increases were partially offset by a reduction of $1,562~~increase in ~~legal, professional and related settlement costs primarily due to a reduction~~European Recreational Vehicle net sales. The decrease in the ~~estimated costs to satisfy certain outstanding legal liability and product recall costs. The~~ overall selling, general and administrative expense as a percentage of ~~towables~~European Recreational Vehicle net sales ~~decreased by 0.6%~~is primarily due to the ~~significant~~ increase in ~~towables~~European Recreational Vehicle net ~~sales.~~

~~Towables~~sales noted above.

The increase in European Recreational Vehicle income before income taxes ~~was $116,728, or 8.5%~~ of ~~towables net sales,~~$26,042 for the three months ended January 31, ~~2018~~2024 compared to ~~$78,000, or 7.2% of towables net sales, for~~ the three months ended January 31, ~~2017.~~2023 was primarily due to the increase in European Recreational Vehicle net sales. The primary reasons for the increase in percentage were the decreases in both the cost of products sold and selling, general and administrative expense percentages ~~to sales~~ noted above.

~~MOTORIZED RECREATIONAL VEHICLES~~

~~Analysis~~ Amortization expense was also 0.4% lower as a percentage of ~~the change in net~~ sales ~~for the three months ended January 31, 2018 compared to the three months ended January 31, 2017:~~

   Three Months
Ended
January 31, 2018    % of
Segment
Net Sales    Three Months
Ended
January 31, 2017    % of
Segment
Net Sales    Change
Amount    %
Change
NET SALES:

Motorized

Class A
   $ 257,092    45.9    $ 223,818    47.1    $ 33,274    14.9
Class C
   278,853    49.8    233,197    49.1    45,656    19.6
Class B
   23,964    4.3    17,957    3.8    6,007    33.5











Total Motorized
   $ 559,909    100.0    $ 474,972    100.0    $ 84,937    17.9











   Three Months
Ended
January 31, 2018    % of
Segment
Shipments    Three Months
Ended
January 31, 2017    % of
Segment
Shipments    Change
Amount    %
Change
# OF UNITS:

Motorized

Class A
   2,364    35.1    2,059    35.3    305    14.8
Class C
   4,191    62.2    3,631    62.3    560    15.4
Class B
   180    2.7    141    2.4    39    27.7











Total Motorized
   6,735    100.0    5,831    100.0    904    15.5


~~Impact of Change in Product Mix and Price on Net Sales:~~	% ~~Increase~~
~~Motorized~~
~~Class A~~		~~0.1~~
~~Class C~~		~~4.2~~
~~Class B~~		~~5.8~~
~~Total Motorized~~		~~2.4~~

The increase in total motorized net sales of 17.9% compared to the prior-year period resulted from a 15.5% increase in unit shipments and a 2.4% increase in the overall net price per unit due to the impact of changes in product mix and price. According to statistics published by RVIA, for the three months ended January 31, 2018, combined motorhome wholesale unit shipments increased 15.8% compared to the same period last year.

~~The increases in the overall net price per unit within the Class A product line of 0.1% and the Class C product line of 4.2% were~~ primarily due to the ~~net impact of product mix changes and selective net price increases. The~~ increase in ~~the overall~~European Recreational Vehicle net price per unit within the Class B product line of 5.8% is primarily due to the introduction of a new, higher-priced model since the prior-year period, and more option content per unit in the current-year period.

sales.

Cost of products sold increased $72,264 to $496,948, or 88.8% of motorized net sales, for the three months ended January 31, 2018 compared to $424,684, or 89.4% of motorized net sales, for the three months ended January 31, 2017. The changes in material, labor,~~freight-out~~ ~~and warranty costs comprised $69,738 of the $72,264 increase due to increased sales volume. Material, labor,freight-out~~ and warranty costs as a combined percentage of motorized net sales decreased to 84.6% for the three months ended January 31, 2018 compared to 85.0% for the three months ended January 31, 2017. This decrease in percentage was primarily the result of a decrease in the material cost percentage, which was partially due to operating efficiencies attained in the past year, primarily at Jayco, but this decrease was partially offset by an increase in labor costs associated with increasing employment levels and the continued competitive RV labor market. Total manufacturing overhead increased $2,526 with the volume increase, but decreased as a percentage of motorized net sales from 4.4% to 4.2%, as the increase in production resulted in better absorption of fixed overhead costs.

Motorized gross profit increased $12,673 to $62,961, or 11.2% of motorized net sales, for the three months ended January 31, 2018 compared to $50,288, or 10.6% of motorized net sales, for the three months ended January 31, 2017. The $12,673 increase in gross profit was due primarily to the 15.5% increase in unit sales volume noted above, and the increase as a percentage of motorized net sales is due to the decrease in the cost of products sold percentage noted above.

Selling, general and administrative expenses were $24,309, or 4.3% of motorized net sales, for the three months ended January 31, 2018 compared to $20,868, or 4.4% of motorized net sales, for the three months ended January 31, 2017. The $3,441 increase was partially due to increased motorized net sales and motorized income before income taxes, which caused related commissions, bonuses and other compensation to increase by $2,509. In addition, legal, professional and related settlement costs increased $462, primarily due to estimated product liability settlement costs. Sales-related travel, advertising and promotional costs also increased $254 in connection with the sales increase.

Motorized income before income taxes was $37,538, or 6.7% of motorized net sales, for the three months ended January 31, 2018 compared to $28,488, or 6.0% of motorized net sales, for the three months ended January 31, 2017. The primary reason for this increase in percentage was the impact of the decrease in the cost of products sold percentage as noted above.

Six Months Ended January 31, ~~2018~~2024 Compared to the Six Months Ended January 31, ~~2017~~

   Six Months Ended
January 31, 2018    Six Months Ended
January 31, 2017    Change
Amount %
Change
NET SALES:

Recreational vehicles

Towables
   $ 2,991,619    $ 2,293,122    $ 698,497 30.5
Motorized
   1,126,520    936,426    190,094 20.3






Total recreational vehicles
   4,118,139    3,229,548    888,591 27.5
Other
   150,932    112,887    38,045 33.7
Intercompany eliminations
   (65,843 )    (45,379 )    (20,464 ) (45.1 )






Total
   $ 4,203,228    $ 3,297,056    $ 906,172 27.5






# OF UNITS:

Recreational vehicles

Towables
   121,441    96,928    24,513 25.3
Motorized
   13,578    11,250    2,328 20.7






Total
   135,019    108,178    26,841 24.8






GROSS PROFIT:    % of
Segment
Net
Sales    % of
Segment
Net
Sales    Change
Amount %
Change
Recreational vehicles

Towables
   $ 455,018 15.2    $ 326,745 14.2    $ 128,273 39.3
Motorized
   126,864 11.3    101,725 10.9    25,139 24.7






Total recreational vehicles
   581,882 14.1    428,470 13.3    153,412 35.8
Other, net
   21,631 14.3    19,984 17.7    1,647 8.2






Total
   $ 603,513 14.4    $ 448,454 13.6    $ 155,059 34.6






SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:


Recreational vehicles

Towables
   $ 157,127 5.3    $ 128,743 5.6    $ 28,384 22.0
Motorized
   51,017 4.5    42,182 4.5    8,835 20.9






Total recreational vehicles
   208,144 5.1    170,925 5.3    37,219 21.8
Other
   4,808 3.2    4,592 4.1    216 4.7
Corporate
   38,399 —      23,762 —      14,637 61.6






Total
   $ 251,351 6.0    $ 199,279 6.0    $ 52,072 26.1






INCOME (LOSS) BEFORE INCOME TAXES:


Recreational vehicles

Towables
   $ 275,579 9.2    $ 172,173 7.5    $ 103,406 60.1
Motorized
   75,124 6.7    57,411 6.1    17,713 30.9






Total recreational vehicles
   350,703 8.5    229,584 7.1    121,119 52.8
Other, net
   13,773 9.1    12,074 10.7    1,699 14.1
Corporate
   (36,320 ) —      (27,493 ) —      (8,827 ) (32.1 )






Total
   $ 328,156 7.8    $ 214,165 6.5    $ 113,991 53.2

2023


NET SALES:	Six Months Ended January 31, 2024		Six Months Ended January 31, 2023		Change Amount		% Change
Recreational vehicles
North American Towable	$	1,676,422	$	2,147,557	$	(471,135)	(21.9)
North American Motorized	1,281,583		1,862,102		(580,519)		(31.2)
Total North America	2,958,005		4,009,659		(1,051,654)		(26.2)
European	1,490,495		1,151,240		339,255		29.5
Total recreational vehicles	4,448,500		5,160,899		(712,399)		(13.8)
Other	365,455		397,507		(32,052)		(8.1)
Intercompany eliminations	(105,827)		(103,687)		(2,140)		(2.1)
Total	$	4,708,128	$	5,454,719	$	(746,591)	(13.7)


# OF UNITS:
Recreational vehicles
North American Towable	50,065	52,225	(2,160)	(4.1)
North American Motorized	10,020	13,588	(3,568)	(26.3)
Total North America	60,085	65,813	(5,728)	(8.7)
European	24,972	22,538	2,434	10.8
Total	85,057	88,351	(3,294)	(3.7)


GROSS PROFIT:			% of Segment Net Sales			% of Segment Net Sales	Change Amount		% Change
Recreational vehicles
North American Towable	$	171,908	10.3	$	248,729	11.6	$	(76,821)	(30.9)
North American Motorized	140,113		10.9	292,947		15.7	(152,834)		(52.2)
Total North America	312,021		10.5	541,676		13.5	(229,655)		(42.4)
European	242,153		16.2	160,295		13.9	81,858		51.1
Total recreational vehicles	554,174		12.5	701,971		13.6	(147,797)		(21.1)
Other, net	74,605		20.4	67,440		17.0	7,165		10.6
Total	$	628,779	13.4	$	769,411	14.1	$	(140,632)	(18.3)


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
Recreational vehicles
North American Towable	$	119,822	7.1	$	132,001	6.1	$	(12,179)	(9.2)
North American Motorized	69,267		5.4	100,595		5.4	(31,328)		(31.1)
Total North America	189,089		6.4	232,596		5.8	(43,507)		(18.7)
European	148,952		10.0	127,877		11.1	21,075		16.5
Total recreational vehicles	338,041		7.6	360,473		7.0	(22,432)		(6.2)
Other	36,818		10.1	35,375		8.9	1,443		4.1
Corporate	63,162		—	54,519		—	8,643		15.9
Total	$	438,021	9.3	$	450,367	8.3	$	(12,346)	(2.7)

INCOME (LOSS) BEFORE INCOME TAXES: Six Months Ended
January 31, 2024 % of
Segment
Net Sales Six Months Ended
January 31, 2023 % of
Segment
Net Sales Change
Amount %
Change
Recreational vehicles
North American Towable $ 49,910 3.0 $ 103,888 4.8 $ (53,978) (52.0)
North American Motorized 63,512 5.0 185,977 10.0 (122,465) (65.8)
Total North America 113,422 3.8 289,865 7.2 (176,443) (60.9)
European 66,824 4.5 5,547 0.5 61,277 1,104.7
Total recreational vehicles 180,246 4.1 295,412 5.7 (115,166) (39.0)
Other, net 16,819 4.6 13,034 3.3 3,785 29.0
Corporate (117,589) — (96,457) — (21,132) (21.9)
Total $ 79,476 1.7 $ 211,989 3.9 $ (132,513) (62.5)

CONSOLIDATED

Consolidated net sales for the six months ended January 31, ~~2018 increased $906,172,~~2024 decreased $746,591, or ~~27.5%~~13.7%, compared to the six months ended January 31, ~~2017.~~ 2023. The decrease in consolidated net sales is primarily due to lower current dealer and consumer demand in comparison to demand in the prior-year period, primarily in the North American Towable and Motorized segments. Approximately 31.7% of the Company’s net sales for the six months ended January 31, 2024 were transacted in a currency other than the U.S. dollar. The Company’s most material exchange rate exposure is sales in Euros. The decrease in consolidated net sales includes an increase of $77,163 from the change in currency exchange rates between the two periods. To determine this impact, net sales transacted in currencies other than U.S. dollars have been translated to U.S. dollars using the average exchange rates that were in effect during the comparative periods.

Consolidated gross profit for the six months ended January 31, ~~2018 increased $155,059, or 34.6%,~~2024 decreased $140,632 compared to the six months ended January 31, ~~2017.~~2023. Consolidated gross profit was ~~14.4%~~13.4% of consolidated net sales for the six months ended January 31, ~~2018~~2024 and ~~13.6%~~14.1% for the six months ended January 31, ~~2017.~~

2023. The decreases in consolidated gross profit and the consolidated gross profit percentage were both primarily due to the impact of the decrease in consolidated net sales in the current-year period compared to the prior-year period.

Selling, general and administrative expenses for the six months ended January 31, ~~2018 increased $52,072,~~2024 decreased $12,346, or ~~26.1%~~2.7%, compared to the six months ended January 31, ~~2017. Amortization of intangible assets expense for the six months ended January 31, 2018 decreased $6,140, or 18.3%, compared to the six months ended January 31, 2017,~~2023, primarily due to ~~backlog amortization~~the 13.7% decrease in ~~the prior-year period~~consolidated net sales and a decrease in net costs related to the ~~Jayco acquisition~~ongoing investigation of the Company’s advertising practices in Germany and ~~lower dealer network amortization~~a product recall as ~~compared~~discussed in Note 14 to the ~~prior-year period. Income~~Condensed Consolidated Financial Statements, partially offset by an increase in third-party fees related to the debt refinancing in the second quarter of fiscal 2024.

The decrease of $132,513, or 62.5%, in income before income taxes for the six months ended January 31, ~~2018 was $328,156, as~~2024 compared to ~~$214,165~~the six months ended January 31, 2023 was primarily driven by the decrease in consolidated net sales noted above.

The overall effective income tax rate for the six months ended January 31, ~~2017, an~~2024 was 24.0% compared with 23.0% for the six months ended January 31, 2023. The primary reason for the increase relates to the jurisdictional mix of ~~$113,991, or 53.2%.~~

pre-tax income between foreign and domestic operations between the comparable periods.

Additional information concerning the changes in net sales, gross profit, selling, general and administrative expenses ~~amortization of intangible assets expense~~ and income before income taxes are addressed below and in the segment reporting that follows.

The $8,643 increase in Corporate costs included in selling, general and administrative expenses ~~increased $14,637 to $38,399~~ for the six months ended January 31, ~~2018~~2024 compared to ~~$23,762 for~~ the six months ended January 31, ~~2017. The increase is due in part to~~2023 includes an increase of $9,355 in compensation costs, as incentive compensation increased $2,265 in correlation with the increase in income before income taxes compared to the prior year, and stock-based compensation increased $2,839. The stock-based compensation increase is due to increasing income before income taxes over the past three years, as most stock awards vest ratably over a three-year period. Deferred compensation expense also increased $2,949, which relates to the equal and offsetting increase in other income noted below due to the increase in the related deferred compensation plan assets. Legallegal and professional fees, ~~including costs~~primarily related to ~~sales and marketing initiatives and~~third-party fees of $7,175 incurred with the ~~joint venture~~debt refinancing discussed in Note 1512 to the Condensed Consolidated Financial ~~Statements, increased $3,928.~~

Statements. The $8,643 increase also includes an increase in deferred compensation expense of $3,684 due to market value fluctuations between the two periods, an increase in innovation-led research and development costs of $4,167 and an increase in stock-based and other compensation of $5,531. These increases were partially offset by income of $14,200 related to the legal and recall matters discussed in Note 14 to the Condensed Consolidated Financial Statements.

The $12,489 increase in net expense in Corporate interest and other income and ~~expense was $2,079 of net income for the six months ended January 31, 2018 compared to $3,731 of net~~ expense for the six months ended January 31, ~~2017. This favorable change~~2024 compared to the six months ended January 31, 2023 includes a decrease of ~~$5,810 is partially due to interest expense and fees of $2,459 incurred~~$8,405 in non-cash foreign currency gains on certain Euro-denominated loans in the current-year period ~~related to the revolving credit facility,~~ as compared to ~~$4,723 in~~ the prior-year period, ~~a decrease~~and the current-year period included operating losses of ~~$2,264 primarily~~$9,437 related to our Roadpass Digital joint venture as ~~a result~~discussed in Note 8 to the Condensed Consolidated Financial Statements. These increases in net expense were partially offset by the favorable change of ~~the lower outstanding debt balance. In addition, the change~~$3,226 in the fair value of the ~~Company’s~~Company's deferred compensation plan assets due to market fluctuations between the two periods, and ~~investment income resulted~~a decrease in ~~$3,734~~net interest expense of ~~net income~~$2,496, in ~~the current-year period as compared to net income of $785 in the prior-year period, an increase of $2,949.~~

The overall effective income tax rate for the six months ended January 31, 2018 was 36.6% compared with 33.0% for the six months ended January 31, 2017. The primary reason for the increase in the effective income tax rate was the impactspite of the Tax Cuts and Jobs Act (the “Tax Act”) that was signed into law on December 22, 2017. Under the Tax Act, the federal corporate income tax rate was reduced from 35.0% to 21.0% starting January 1, 2018, which results in the use of an estimated blended federal corporate income tax rate of 26.9% for the Company’s 2018 fiscal year. In addition, the Company was also required to revalue its net deferred tax assets to reflect the impact of the lower tax rates. This revaluation caused a~~non-recurring,non-cash~~ ~~reduction of the Company’s net deferred tax assets, and a corresponding charge to income tax expense, of approximately $34,000~~one-time debt refinancing fees incurred in the second quarter of fiscal ~~2018. This charge was partially offset by the lower tax expense reflected in thesix-month~~ ~~period ended January 31, 2018~~2024, primarily due to ~~the decrease in our federal corporate~~increased interest income ~~tax rate~~received from higher average cash balances held and higher interest income rates and lower debt interest expense primarily due to ~~26.9% for fiscal 2018 as a result of the Tax Act.~~

lower average debt balances outstanding.

Segment Reporting

NORTH AMERICAN TOWABLE RECREATIONAL VEHICLES

Analysis of the change in net sales for the six months ended January 31, ~~2018~~2024 compared to the six months ended January 31, ~~2017:~~

   Six Months
Ended
January 31, 2018    % of
Segment
Net Sales    Six Months
Ended
January 31, 2017    % of
Segment
Net Sales    Change
Amount    %
Change
NET SALES:

Towables

Travel Trailers and Other
   $ 1,822,922    60.9    $ 1,376,873    60.0    $ 446,049    32.4
Fifth Wheels
   1,168,697    39.1    916,249    40.0    252,448    27.6











Total Towables
   $ 2,991,619    100.0    $ 2,293,122    100.0    $ 698,497    30.5











   Six Months
Ended
January 31, 2018    % of
Segment
Shipments    Six Months
Ended
January 31, 2017    % of
Segment
Shipments    Change
Amount    %
Change
# OF UNITS:

Towables

Travel Trailers and Other
   94,647    77.9    75,374    77.8    19,273    25.6
Fifth Wheels
   26,794    22.1    21,554    22.2    5,240    24.3











Total Towables
   121,441    100.0    96,928    100.0    24,513    25.3


~~Impact of Change in Product Mix and Price on Net Sales:~~	% ~~Increase~~
~~Towables~~
~~Travel Trailers and Other~~		~~6.8~~
~~Fifth Wheels~~		~~3.3~~
~~Total Towables~~		~~5.2~~

2023:


	Six Months Ended January 31, 2024		% of Segment Net Sales	Six Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
North American Towable
Travel Trailers	$	1,091,021	65.1	$	1,350,698	62.9	$	(259,677)	(19.2)
Fifth Wheels	585,401		34.9	796,859		37.1	(211,458)		(26.5)
Total North American Towable	$	1,676,422	100.0	$	2,147,557	100.0	$	(471,135)	(21.9)

	Six Months Ended January 31, 2024		% of Segment Shipments	Six Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
North American Towable
Travel Trailers	40,282		80.5	40,849		78.2	(567)		(1.4)
Fifth Wheels	9,783		19.5	11,376		21.8	(1,593)		(14.0)
Total North American Towable	50,065		100.0	52,225		100.0	(2,160)		(4.1)

IMPACT OF CHANGE IN PRODUCT MIX AND PRICE ON NET SALES:									% Change
North American Towable
Travel Trailers									(17.8)
Fifth Wheels									(12.5)
Total North American Towable									(17.8)

The ~~increase~~decrease in total ~~towables~~North American Towable net sales of ~~30.5%~~21.9% compared to the prior-year period resulted from a ~~25.3% increase~~4.1% decrease in unit shipments and a ~~5.2% increase~~17.8% decrease in the overall net price per unit due to the combined impact of changes in product mix and price. The decrease in unit shipments is primarily due to a softening in dealer and consumer demand in comparison with demand in the prior-year period. According to statistics published by RVIA, for the six months ended January 31, ~~2018,~~2024, combined North American travel trailer and fifth wheel wholesale unit shipments ~~increased 24.4%~~decreased 0.3% compared to the same period last year.

According to the most recently published statistics from Stat Surveys, for the six-month periods ended December 31, 2023 and 2022, our North American market share for travel trailers and fifth wheels combined was 40.6% and 42.1%, respectively. Comparisons of Company shipments to industry shipments on a quarterly basis would not necessarily be indicative of the results expected for a full fiscal year.

The ~~increases~~decreases in the overall net price per unit within the travel trailer ~~and other~~ product ~~lines~~line of ~~6.8%~~17.8% and the fifth wheel product ~~lines~~line of ~~3.3%~~12.5% were ~~both~~ primarily due to ~~changes in~~the combined impact of sales price reductions due to lower input costs, higher sales discounting levels and product mix ~~and selective net price increases since~~changes trending toward more moderately-priced units as compared to the prior-year period.

~~Cost~~

North American Towable cost of products sold ~~increased $570,224~~decreased $394,314 to ~~$2,536,601,~~$1,504,514, or ~~84.8%~~89.7% of ~~towables~~North American Towable net sales, for the six months ended January 31, ~~2018~~2024 compared to ~~$1,966,377,~~$1,898,828, or ~~85.8%~~88.4% of ~~towables~~North American Towable net sales, for the six months ended January 31, ~~2017. The changes~~2023. Changes in material, labor,freight-out and warranty costs comprised ~~$541,280~~$376,989 of the ~~$570,224 increase~~$394,314 decrease in cost of products sold. Material, labor,freight-out and warranty costs as a combined percentage of ~~towables~~North American Towable net sales ~~decreased~~increased slightly to ~~79.2%~~80.9% for the six months ended January 31, ~~2018~~2024 compared to ~~79.7%~~80.7% for the six months ended January 31, ~~2017. This decrease~~2023, as modest increases in ~~percentage was primarily~~ the ~~result of~~labor and warranty percentages were mostly offset by a decrease in the material cost percentage. Total manufacturing overhead decreased $17,325 in correlation with the decrease in sales but increased as a percentage toof North American Towable net sales from 7.7% to 8.8%, as the decreased net sales levels resulted in higher overhead costs per unit sold.

The decrease of $76,821 in North American Towable gross profit for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 was driven by the decrease in net sales and the decrease in the gross profit percentage is due to ~~selective~~the increase in the cost of products sold percentage noted above.

The decrease of $12,179 in North American Towable selling, general and administrative expenses for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 includes the impact of the decrease in North American Towable net ~~price increases~~sales and ~~operating efficiencies attained since the prior-year period, primarily~~income before income taxes, which caused related commissions, incentive and other compensation to decrease by ~~Jayco. This decrease was~~$17,038. These decreases were partially offset by an increase of $8,006 in professional fees and related settlement and RV repurchase costs. The increase in the ~~labor cost percentage due to the continued competitive RV labor market. Total manufacturing overhead increased $28,944 with the increase in sales, but decreased~~overall selling, general and administrative expense as a percentage of ~~towables~~North American Towable net sales ~~from 6.1%~~is primarily due to ~~5.6%, as~~ the ~~increased production resulted~~decrease in ~~better absorption~~net sales.

The decrease of ~~fixed overhead costs.~~

~~Towables gross profit increased $128,273~~$53,978 in North American Towable income before income taxes for the six months ended January 31, 2024 compared to ~~$455,018, or 15.2%~~the six months ended January 31, 2023 was primarily due to the decrease in North American Towable net sales, and the primary reasons for the decrease in percentage were the increases in the cost of ~~towables~~products sold and selling, general and administrative expense percentages noted above.

NORTH AMERICAN MOTORIZED RECREATIONAL VEHICLES

Analysis of the change in net sales for the six months ended January 31, ~~2018~~2024 compared to ~~$326,745,~~the six months ended January 31, 2023:


	Six Months Ended January 31, 2024		% of Segment Net Sales	Six Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
North American Motorized
Class A	$	386,219	30.1	$	648,706	34.8	$	(262,487)	(40.5)
Class C	609,408		47.6	825,698		44.3	(216,290)		(26.2)
Class B	285,956		22.3	387,698		20.9	(101,742)		(26.2)
Total North American Motorized	$	1,281,583	100.0	$	1,862,102	100.0	$	(580,519)	(31.2)

	Six Months Ended January 31, 2024		% of Segment Shipments	Six Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
North American Motorized
Class A	1,955		19.5	3,120		23.0	(1,165)		(37.3)
Class C	5,584		55.7	7,281		53.6	(1,697)		(23.3)
Class B	2,481		24.8	3,187		23.4	(706)		(22.2)
Total North American Motorized	10,020		100.0	13,588		100.0	(3,568)		(26.3)

IMPACT OF CHANGE IN PRODUCT MIX AND PRICE ON NET SALES:									% Change
North American Motorized
Class A									(3.2)
Class C									(2.9)
Class B									(4.0)
Total North American Motorized									(4.9)

The decrease in total North American Motorized net sales of 31.2% compared to the prior-year period resulted from a 26.3% decrease in unit shipments and a 4.9% decrease in the overall net price per unit due to the combined impact of changes in product mix and price, which included elevated sales discounts compared to the prior-year period. The decrease in unit shipments is primarily due to a softening in current dealer and consumer demand in comparison with the demand in the prior-year period, which included independent dealer restocking of certain motorized products. According to statistics published by RVIA, for the six months ended January 31, 2024, combined North American motorhome wholesale unit shipments decreased 25.7% compared to the same period last year. According to statistics published by Stat Surveys, for the six-month periods ended December 31, 2023 and 2022, our North American market share for motorhomes was 48.3% and 47.2%, respectively. Comparisons of Company shipments to industry shipments on a quarterly basis would not necessarily be indicative of the results expected for a full fiscal year.

The decreases in the overall net price per unit within the Class A product line of 3.2%, the Class C product line of 2.9% and the Class B product line of 4.0% were all primarily due to higher discounting levels since the prior-year period and consumers trending toward more moderately-priced units compared to the prior-year period.

North American Motorized cost of products sold decreased $427,685 to $1,141,470, or ~~14.2%~~89.1% of ~~towables~~North American Motorized net sales, for the six months ended January 31, ~~2017. The~~2024 compared to $1,569,155, or 84.3% of North American Motorized net sales, for the six months ended January 31, 2023. Changes in material, labor, freight-out and warranty costs comprised $406,092 of the $427,685 decrease. Material, labor, freight-out and warranty costs as a combined percentage of North American Motorized net sales increased to 82.8% for the six months ended January 31, 2024 compared to 78.8% for the six months ended January 31, 2023, with the increase due to an increase in the material cost percentage, primarily due to higher sales discounting, which effectively decreases net selling prices and correspondingly increases the material cost percentage, as well as increased chassis costs. Total manufacturing overhead decreased $21,593 with the decrease in net sales but increased as a percentage of North American Motorized net sales from 5.5% to 6.3% as the decrease in net sales levels resulted in higher overhead costs per unit sold.

The decrease of $152,834 in North American Motorized gross profit for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 was driven by the decrease in net sales, while the decrease in the gross profit percentage is due to the increase in the cost of products sold percentage noted above.

The decrease of $31,328 in North American Motorized selling, general and administrative expenses for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 is primarily due to the ~~25.3% increase~~decreases in ~~unit~~North American Motorized net sales ~~volume noted above, while~~and income before income taxes, which caused related commissions, incentive and other compensation to decrease by $30,763.

The decrease of $122,465 in North American Motorized income before income taxes for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 was primarily due to the decrease in North American Motorized net sales, and the primary reason for the decrease in percentage was the increase in the cost of products sold percentage noted above.

EUROPEAN RECREATIONAL VEHICLES

Analysis of the change in net sales for the six months ended January 31, 2024 compared to the six months ended January 31, 2023:


	Six Months Ended January 31, 2024		% of Segment Net Sales	Six Months Ended January 31, 2023		% of Segment Net Sales	Change Amount		% Change
NET SALES:
European
Motorcaravan	$	771,324	51.7	$	507,567	44.1	$	263,757	52.0
Campervan	466,333		31.3	366,302		31.8	100,031		27.3
Caravan	115,714		7.8	156,109		13.6	(40,395)		(25.9)
Other	137,124		9.2	121,262		10.5	15,862		13.1
Total European	$	1,490,495	100.0	$	1,151,240	100.0	$	339,255	29.5

	Six Months Ended January 31, 2024		% of Segment Shipments	Six Months Ended January 31, 2023		% of Segment Shipments	Change Amount		% Change
# OF UNITS:
European
Motorcaravan	10,113		40.5	7,184		31.9	2,929		40.8
Campervan	10,122		40.5	8,159		36.2	1,963		24.1
Caravan	4,737		19.0	7,195		31.9	(2,458)		(34.2)
Total European	24,972		100.0	22,538		100.0	2,434		10.8


IMPACT OF CHANGES IN FOREIGN CURRENCY, PRODUCT MIX AND PRICE ON NET SALES:

	Foreign Currency %	Mix and Price %	% Change

European
Motorcaravan	6.7	4.5	11.2
Campervan	6.7	(3.5)	3.2
Caravan	6.7	1.6	8.3
Total European	6.7	12.0	18.7

The increase in total European Recreational Vehicle net sales of 29.5% compared to the prior-year period resulted from increases of 10.8% in unit shipments and 18.7% in the overall net price per unit due to the total combined impact of changes in foreign currency, product mix and price. The increase in European Recreational Vehicle net sales of $339,255 includes an increase of $77,163, or 6.7% of the 29.5% increase, due to the increase in foreign exchange rates since the prior-year period. Sales on a constant-currency basis increased by 22.8%.

The overall net price per unit increase of 18.7% includes increases of 6.7% due to the impact of foreign currency exchange rate changes and 12.0% due to the combined impact of product mix and selling price increases, primarily due to the much higher concentration of Motorcaravan sales in the current-year period due primarily to improved supply of chassis and other components in the current-year period compared to the prior-year period.

The constant-currency increases in the overall net price per unit within the Motorcaravan product line of 4.5% and the Caravan product line of 1.6% were primarily due to the impact of selling price increases and product mix changes. The constant-currency decrease in the overall net price per unit within the Campervan product line of 3.5% was primarily due to the impact of product mix changes.

European Recreational Vehicle cost of products sold increased $257,397 to $1,248,342, or 83.8% of European Recreational Vehicle net sales, for the six months ended January 31, 2024 compared to $990,945, or 86.1% of European Recreational Vehicle net sales, for the six months ended January 31, 2023. Changes in material, labor, freight-out and warranty costs comprised $222,851 of the $257,397 increase. Material, labor, freight-out and warranty costs as a combined percentage of European Recreational Vehicle net sales decreased to 72.6% for the six months ended January 31, 2024 compared to 74.6% for the six months ended January 31, 2023, with the decrease primarily due to a decrease in the material cost percentage due to net selling price increases and product mix changes. The labor cost percentage also improved. Total manufacturing overhead increased with the increase in European Recreational Vehicle net sales but decreased as a percentage of European Recreational Vehicle net sales from 11.5% to 11.2% primarily due to the increase in net sales resulting in decreased overhead costs per unit sold.

The increase of $81,858 in European Recreational Vehicle gross profit ~~percentage is~~for the six months ended January 31, 2024 compared to the six months ended January 31, 2023 was primarily due to the increase in European Recreational Vehicle net sales and the decrease in the cost of products sold percentage noted above.

~~Selling,~~

The increase of $21,075 in European Recreational Vehicle selling, general and administrative expenses ~~were $157,127, or 5.3% of towables net sales,~~ for the six months ended January 31, ~~2018~~2024 compared to ~~$128,743, or 5.6% of towables net sales, for~~ the six months ended January 31, ~~2017. The primary reason for~~2023 was primarily due to the ~~$28,384~~ increase ~~was increased towables~~in European Recreational Vehicle net sales and ~~towables~~ income before income taxes, which caused related commissions, ~~bonuses~~incentive and other compensation to increase by $22,938. Legal, professional and related settlement costs increased $1,989, primarily due to estimated costs related to an industry-wide recall of certain vendor-supplied components and estimated product liability settlement costs. In addition, sales-related$7,381. Sales-related travel, advertising and promotional costs also increased ~~$2,111 in correlation with the sales increase. In spite of these increased amounts, the overall selling, general and administrative expense percentage of towables net sales decreased by 0.3%~~$8,927, primarily due to increased display space at the ~~significant~~annual Dusseldorf show and attending more regional shows in comparison to the prior-year period.

The increase of $61,277 in ~~towables net sales.~~

~~Towables~~European Recreational Vehicle income before income taxes ~~was $275,579, or 9.2% of towables net sales,~~ for the six months ended January 31, ~~2018~~2024 compared to ~~$172,173, or 7.5% of towables net sales, for~~ the six months ended January 31, ~~2017.~~2023 was primarily due to the increase in European Recreational Vehicle net sales. The primary reasons for the increase in percentage were the decreases in both the cost of products sold and selling, general and administrative expense percentages ~~to sales~~ noted above. ~~In addition, the towables amortization cost~~Amortization expense was also 0.6% lower as a percentage ~~decreased by 0.5%, primarily due tonon-recurring~~ ~~backlog amortization~~of sales in the ~~prior-year period related to the Jayco acquisition.~~

~~MOTORIZED RECREATIONAL VEHICLES~~

~~Analysis of the change in net sales for the six months ended January 31, 2018 compared to the six months ended January 31, 2017:~~

   Six Months
Ended
January 31, 2018    % of
Segment
Net Sales    Six Months
Ended
January 31, 2017    % of
Segment
Net Sales    Change
Amount    %
Change
NET SALES:

Motorized

Class A
   $ 509,515    45.2    $ 463,932    49.5    $ 45,583    9.8
Class C
   565,519    50.2    433,092    46.3    132,427    30.6
Class B
   51,486    4.6    39,402    4.2    12,084    30.7











Total Motorized
   $ 1,126,520    100.0    $ 936,426    100.0    $ 190,094    20.3











   Six Months
Ended
January 31, 2018    % of
Segment
Shipments    Six Months
Ended
January 31, 2017    % of
Segment
Shipments    Change
Amount    %
Change
# OF UNITS:

Motorized

Class A
   4,631    34.1    4,248    37.8    383    9.0
Class C
   8,555    63.0    6,690    59.5    1,865    27.9
Class B
   392    2.9    312    2.7    80    25.6











Total Motorized
   13,578    100.0    11,250    100.0    2,328    20.7


~~Impact of Change in Product Mix and Price on Net Sales:~~	% ~~Increase~~ ~~(Decrease)~~
~~Motorized~~
~~Class A~~		~~0.8~~
~~Class C~~		~~2.7~~
~~Class B~~		~~5.1~~
~~Total Motorized~~		~~(0.4~~	)

~~The increase in total motorized net sales of 20.3%~~current year compared to the prior-year ~~period resulted from a 20.7% increase in unit shipments~~period.

Liquidity and a 0.4% decrease in the overall net price per unit due to the impact of changes in product mix and price. The 0.4% decrease in the overall motorized net price per unit, in spite of increases within the individual Class A, B and C product lines, is primarily due to a higher concentration of the more moderately-priced Class C units, as compared to Class A units, in the current-year period as compared to the prior-year period. According to statistics published by RVIA, for the six months ended January 31, 2018, combined motorhome wholesale unit shipments increased 16.1% compared to the same period last year.

The modest increases in the overall net price per unit within the Class A product line of 0.8% and the Class C product line of 2.7% were primarily due to the net impact of product mix changes and selective net price increases. The increase in the overall net price per unit within the Class B product line of 5.1% is primarily due to the introduction of a new, higher-priced model since the prior-year period, and more option content per unit in the current-year period.

Cost of products sold increased $164,955 to $999,656, or 88.7% of motorized net sales, for the six months ended January 31, 2018 compared to $834,701, or 89.1% of motorized net sales, for the six months ended January 31, 2017. The changes in material, labor,~~freight-out~~ ~~and warranty costs comprised $158,958 of the $164,955 increase due to increased sales volume. Material, labor,freight-out~~ ~~and warranty costs as a combined percentage of motorized net sales was 84.7% for thesix-month~~ ~~period ended January 31, 2018 and 84.9% for thesix-month~~ period ended January 31, 2017. The primary reason for this decrease in percentage was a decrease in the material cost percentage, which was partially due to operating efficiencies attained in the past year, primarily at Jayco, and purchase accounting charges related to Jayco included in the prior-year period. This decrease was partially offset by an increase in labor costs associated with increasing employment levels and the continued competitive RV labor market. Total manufacturing overhead increased $5,997 with the volume increase, but decreased as a percentage of motorized net sales from 4.2% to 4.0%, as the increase in production resulted in better absorption of fixed overhead costs.

Motorized gross profit increased $25,139 to $126,864, or 11.3% of motorized net sales, for the six months ended January 31, 2018 compared to $101,725, or 10.9% of motorized net sales, for the six months ended January 31, 2017. The $25,139 increase in gross profit was due primarily to the 20.7% increase in unit sales volume noted above, and the increase as a percentage of motorized net sales is due to the decrease in the cost of products sold percentage noted above.

Selling, general and administrative expenses were $51,017, or 4.5% of motorized net sales, for the six months ended January 31, 2018 compared to $42,182, or 4.5% of motorized net sales, for the six months ended January 31, 2017. The $8,835 increase was partially due to increased motorized net sales and motorized income before income taxes, which caused related commissions, bonuses and other compensation to increase by $4,730. In addition, legal, professional and related settlement costs increased $2,757, primarily due to estimated product liability settlement costs and estimated costs related to an industry-wide recall of certain vendor-supplied components. Sales related travel, advertising and promotional costs also increased $804 in connection with the sales increase.

Motorized income before income taxes was $75,124, or 6.7% of motorized net sales, for the six months ended January 31, 2018 compared to $57,411, or 6.1% of motorized net sales, for the six months ended January 31, 2017. The primary reason for this increase in percentage was the impact of the decrease in the cost of products sold percentage noted above. In addition, the motorized income before income taxes percentage increased due to a gain of $1,506 on the sale of certain motorized buildings and equipment during the six months ended January 31, 2018.

~~Financial Condition and Liquidity~~

Capital Resources

As of January 31, ~~2018,~~2024, we had ~~$109,775~~$340,192 in cash and cash equivalents, of which $257,635 was held in the U.S. and the equivalent of $82,557, predominantly in Euros, was held in Europe, compared to ~~$223,258~~$441,232 on July 31, ~~2017.~~2023, of which $338,703 was held in the U.S. and the equivalent of $102,529, predominantly in Euros, was held in Europe. Cash and cash equivalents held internationally may be subject to foreign withholding taxes if repatriated to the U.S. The components of ~~this $113,483~~the $101,040 decrease in cash and cash equivalents are described in more detail below, but the decrease was primarily attributable to ~~capital expenditures~~cash used in operations of ~~$63,003, principal payments on long-term debt~~$44,200 and cash used in investing activities of ~~$65,000 and $38,994 paid for dividends,~~$80,943, partially offset by cash provided by ~~operations~~financing activities of ~~$56,845.~~

~~Working~~$26,754.

Net working capital at January 31, ~~2018~~2024 was ~~$517,085~~$1,212,801 compared to ~~$399,121~~$1,077,098 at July 31, ~~2017, with the increase primarily attributable to increases in accounts receivable and inventory due to the increases in sales, backlog and production lines.~~2023. Capital expenditures of ~~$63,003~~$78,901 for the six months ended January 31, ~~2018~~2024 were made primarily for ~~land and~~ production building additions and improvements ~~as well as~~and replacing machinery and equipment used in the ordinary course of business.

We strive to maintain adequate cash balances to ensure we have sufficient resources to respond to opportunities and changing business conditions. In addition, the unused availability under our revolving asset-based credit facility is generally available to the Company for general operating purposes and approximated $938,000 at January 31, 2024. We believe ouron-hand cash and cash equivalents and funds generated from ~~continuing~~ operations, along with funds available under the revolving asset-based credit facility, will be sufficient to fund expected ~~future~~ operational requirements for the foreseeable future. We have historically relied on internally generated cash flows from operations to finance substantially all our growth, however, we obtained a revolving asset-based credit facility to partially fund the fiscal 2016 acquisition of Jayco as discussed in Notes 2 and 11 to the Condensed Consolidated Financial Statements.

~~While the Tax Act enacted in December 2017 is expected to generate additional cash flow in the future, our main~~

Our priorities for the use of current and future available cash generated from operations ~~will continue to focus on~~remain consistent with our history, and include reducing our indebtedness, maintaining and, over time, growing our dividend payments and funding our growth, both organically and, opportunistically, through ~~acquisitions, maintaining~~acquisitions. We may also consider strategic and ~~growing~~opportunistic repurchases of shares of THOR stock under the share repurchase authorizations as discussed in Note 16 to the Condensed Consolidated Financial Statements, and special dividends based upon market and business conditions and excess cash availability, subject to potential customary limits and restrictions pursuant to our ~~regular dividends over time,~~credit facilities, applicable legal limitations and ~~reducing indebtedness. Strategic~~determination by the Company's Board of Directors ("Board"). We believe our on-hand cash and cash equivalents and funds generated from operations will be sufficient to fund expected cash dividend payments and share repurchases ~~or special dividends, as determined by~~for the ~~Company’s Board, will also continue to be considered. As a component~~foreseeable future.

Our current estimate of ~~funding our growth, we anticipate making additional investments in our workforce through a variety of initiatives, including enhanced employee training~~committed and ~~development programs and other initiatives that will be introduced in fiscal 2018 and fiscal 2019 and targeted to the varying needs of our individual operating entities.~~

~~In regard to growing our business, we anticipate~~internally approved capital ~~expenditures during~~spend for the remainder of fiscal ~~2018 of approximately $110,000,~~2024 is $100,000, primarily for ~~the continued expansion of our facilities~~certain building projects and certain automation projects, as well as replacing and upgrading machinery, equipment and other assets throughout our facilities to be used in the ordinary course of business.

~~These~~ We anticipate that these expenditures ~~are in addition to the approximately $47,000~~will be funded by cash investment in the joint venture as discussed in Note 15 to the Condensed Financial Statements. In regard to reducing indebtedness, absent an alternative to strategically employ funds available under the credit facility, we expect to pay off the current remaining indebtedness of $80,000 in its entiretyprovided by ~~the end of fiscal 2018. We may also consider additional strategic growth acquisitions that complement or expand~~ our ~~ongoing operations.~~

operating activities.

The Company’s Board currently intends to continue regular quarterly cash dividend payments in the future. As is customary under ~~asset-based lines of~~ credit facilities, certain actions, including our ability to pay dividends, are subject to the satisfaction of certain ~~payment~~ conditions prior to payment. The conditions for the ~~payments~~payment of dividends under the existing debt facilities include a minimum level of adjusted excess cash availability and a fixed charge coverage ratio test, both as defined in the credit ~~agreement.~~agreements. The declaration of future dividends and the establishment of the per share amounts, record dates and payment dates for any such future dividends are subject to the determination of the Board, and will be dependent upon future earnings, cash flows and other ~~factors.~~

~~Future purchases of the Company’s common stock or special cash dividends may occur based upon market and business conditions and excess cash availability, subject~~factors, in addition to ~~potential customary limits and restrictions pursuant to the credit facility, applicable legal limitations and determination by the Board.~~

compliance with any then-existing financing facilities.

Operating Activities

Net cash ~~provided by~~used in operating activities for the six months ended January 31, ~~2018~~2024 was ~~$56,845~~$44,200 as compared to net cash provided by operating activities of ~~$52,816~~$185,321 for the six months ended January 31, ~~2017.~~

2023.

For the six months ended January 31, ~~2018,~~2024, net income adjusted fornon-cash items (primarily depreciation, amortization of intangibles ~~deferred income tax provision~~ and stock-based compensation) provided ~~$285,477~~$207,653 of operating cash. The change in net working capital ~~used $228,632~~resulted in a net use of operating cash during that period, primarily as a result of a larger than usual seasonal increase in accounts receivable due to both the timing of shipments and the increase in sales. Inventory also increased in conjunction with the increases in backlog and production facilities and lines, and required income tax payments exceeded the income tax provision during the period as well. These increases were partially offset by increases in accounts payable and accrued liabilities.

~~For the six months ended January 31, 2017, net income adjusted fornon-cash~~ items (primarily depreciation, amortization of intangibles, deferred income tax provision and stock-based compensation) provided $194,056 of operating cash. The changes in working capital used $141,240$251,853 of operating cash during that period, primarily due to ~~seasonal increases~~an increase in ~~accounts receivable and~~chassis inventory ~~in correlation with the increases in sales,~~as European chassis suppliers continue to get caught up delivering their order backlog, and ~~production lines.~~RV finished goods had a seasonal increase heading into the spring selling season. In addition, required income tax payments during the period exceeded the income tax ~~provisions~~provision for the period, and certain accrued liabilities decreased with the reduction in sales and production when compared to the prior-year end period.

For the six months ended January 31, 2023, net income adjusted for non-cash items (primarily depreciation, amortization of intangibles and stock-based compensation) provided $314,016 of operating cash. The change in working capital resulted in the use of $128,695 of operating cash during that period, primarily due to an increase in chassis inventory to support the ~~period.~~

motorized sales and production and as North American chassis suppliers got caught up delivering their order backlog, as the cash impact of the reductions in accounts receivable, accounts payable and accrued liabilities due to the net sales and production decreases mostly offset each other.

Investing Activities

Net cash used in investing activities for the six months ended January 31, ~~2018~~2024 was ~~$58,491,~~$80,943, primarily due to capital expenditures of ~~$63,003, partially offset by proceeds received on the disposition of property, plant and equipment of $3,552.~~

$78,901.

Net cash used in investing activities for the six months ended January 31, ~~2017~~2023 was ~~$53,622,~~$113,748, primarily due to capital expenditures of ~~$50,924~~$100,985.

Financing Activities

Net cash provided by financing activities for the six months ended January 31, 2024 was $26,754, which included borrowings of $113,502 on the asset-based credit facility for temporary working capital needs and ~~a final purchase price adjustment payment~~payments of ~~$5,039 related~~$51,925 on the asset-based credit facility. In addition, borrowings of $186,723 and payments of $127,626 were made on the term-loan credit facilities in connection with the debt refinancing as discussed in Note 12 to the Condensed Consolidated Financial Statements. Treasury share repurchases of $30,037 were made and regular quarterly dividend payments of $0.48 per share for each of the first two quarters of fiscal ~~2016 acquisition of Jayco, partially offset by proceeds received on the dispositions of property, plant and equipment of $4,554.~~

~~Financing Activities~~

2024 were also made totaling $51,135.

Net cash used in financing activities for the six months ended January 31, ~~2018~~2023 was ~~$111,837, primarily for principal~~$101,742, including payments of $15,000 on the ~~revolving~~asset-based credit facility ~~totaling $65,000~~ and ~~regular~~$12,355 on the term-loan credit facilities, in addition to treasury share repurchases of $25,407. Regular quarterly ~~cash~~ dividend payments of ~~$0.37~~$0.45 per share for each of the first two quarters of fiscal ~~2018~~2023 were also made totaling ~~$38,994.~~

Net cash used in financing activities for the six months ended January 31, 2017 was $74,441, primarily for principal payments on the revolving credit facility totaling $35,000 and regular quarterly cash dividend payments of $0.33 per share for each of the first two quarters of fiscal 2017 totaling $34,704.

$48,165.

The Company increased its previous regular quarterly dividend of ~~$0.33~~$0.45 per share to ~~$0.37~~$0.48 per share in October ~~2017.~~2023. In October ~~2016,~~2022, the Company increased its previous regular quarterly dividend of ~~$0.30~~$0.43 per share to ~~$0.33~~$0.45 per share.

Accounting ~~Pronouncements~~

~~Reference is made to~~Standards

See Note 1 ~~of our~~in the Notes to the Condensed Consolidated Financial Statements ~~contained~~included in Item 1 of Part 1 of this ~~report~~Quarterly Report on Form 10-Q.

Critical Accounting Estimates

For a discussion of our critical accounting estimates, refer to "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 and the notes to our Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for ~~a summary of recently issued~~the year ended July 31, 2023. There have been no material changes to our critical accounting ~~pronouncements, which summary is hereby incorporated by reference.~~

estimates since our Annual Report on Form 10-K for the year ended July 31, 2023.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~We have exposure~~

The Company is exposed to market risk from changes in ~~short-term~~foreign currency exchange rates and interest rates. At times, the Company enters into hedging transactions to mitigate certain of these risks in accordance with guidelines established by the Company’s management. The Company does not use financial instruments for trading or speculative purposes.

CURRENCY EXCHANGE RISK – The Company’s principal currency exposures mainly relate to the Euro and British Pound Sterling. The Company periodically uses foreign currency forward contracts to manage certain foreign exchange rate exposure related to anticipated sales transactions in Pounds Sterling with financial instruments whose maturity date, along with the realized gain or loss, occurs on or near the execution of the anticipated transaction.

The Company also holds $479,786 of debt denominated in Euros at January 31, 2024. A hypothetical 10% change in the Euro/U.S. Dollar exchange rate would change our January 31, 2024 debt balance by approximately $47,978.

INTEREST RATE RISK – Based on our assumption of the Company’s floating-rate debt levels over the next 12 months, a one-percentage-point increase in interest rates on(approximately 13.2% of our variable-rate debt. Depending upon the borrowing option chosen, the interest charged is based upon either the Base Rate or LIBOR of a selected time period, plus an applicable margin. If interest rates increased by 0.25% (which approximates a 10% increase of the weighted-average interest rate ~~on our borrowings as of~~at January 31, ~~2018), our results of operations and cash flows for the six months ended January 31, 2018~~2024) would ~~not have been materially affected.~~

result in an estimated $8,776 reduction in income before income taxes over a one-year period.

ITEM 4. CONTROLS AND PROCEDURES

The Company maintains “disclosure controls and ~~procedures”,~~procedures,” as such term is defined under Exchange Act Rule13a-15(e), that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosures. In designing and evaluating the disclosure controls and procedures, our management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives and our management ~~necessarily~~ is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. The Company has carried out an evaluation, as of the end of the period covered by this report, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at attaining the level of reasonable assurance noted above.

During the quarter ended January 31, ~~2018,~~2024, there were no changes in our internal ~~control~~controls over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal ~~control~~controls over financial reporting.

ITEM 5. OTHER INFORMATION

Rule 10b5-1 Trading Arrangements

The Company’s Insider Trading Policy permits its directors and officers to trade Company stock under a “Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K) that is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act, subject to compliance with applicable regulations as well as the Company’s Insider Trading Policy and share ownership requirements. The Insider Trading Policy provides that each officer or director Rule 10b5-1 trading arrangement must be entered into in writing during an open trading window and at a time that the officer or director is not aware of material nonpublic information. The Company generally requires that any Rule 10b5-1 trading arrangement adopted by an officer or director must not expire within one year of implementation and is subject to a mandatory cooling-off period requirement.

On January 16, 2024, our Chief Financial Officer, Colleen Zuhl, adopted a Rule 10b5-1 trading arrangement (providing for the sale of up to 9,728 shares of Company common stock) that is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act. Mrs. Zuhl’s Rule 10b5-1 trading arrangement provides for a mandatory cooling-off period as required by Rule 10b5-1 and is scheduled to expire on January 16, 2025 or such earlier date as of which all of the shares covered by the arrangement have been sold. As of January 31, 2024, Mrs. Zuhl held 118,028 shares of Company common stock not subject to trading under her Rule 10b5-1 trading arrangement.

Except as described above, no director or officer of the Company adopted or terminated a Rule 10b5-1 trading arrangement or “non-Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K) during the three months ended January 31, 2024.

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Company is involved in certain litigation arising out of its operations in the normal course of its business, most of which is based upon state “lemon ~~laws”,~~laws,” warranty claims and vehicle accidents (for which the Company carries insurance above a specified self-insured retention or deductible amount). The outcomes of legal proceedings and claims brought against the Company are subject to significant uncertainty. There is significant judgment required in assessing both the probability of an adverse outcome and the determination as to whether an exposure can be reasonably estimated. In management’s opinion, the ultimate disposition of any current legal proceedings or claims against the Company will not have a material effect on the Company’s financial condition, operating results or cash flows. Litigation is, however, inherently uncertain and an adverse outcome from such litigation could have a material effect on the operating results of a particular reporting period.

ITEM 1A. RISK FACTORS

~~There~~

Although risks specific to the supply chain disruptions are ongoing, and macroeconomic issues like general inflation, as well as certain geopolitical events, including military conflicts, remain, at this point there have been no material changes in those risks or any others from the risk factors previously disclosed in Part I, Item 1A of our Annual Report on Form10-K for the fiscal year ended July 31, ~~2017.~~

2023.

ITEM 6. EXHIBITS


Exhibit			Description
~~Exhibit~~ 3.1			~~Description~~

~~3.1~~	Thor Industries, Inc. Amended and Restated~~By-Laws~~ Certificate of ~~Thor Industries, Inc.~~Incorporation, as amended (incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form8-K ~~dated~~ filed with the SEC on December ~~13, 2017)~~20, 2018)
3.2		Thor Industries, Inc. Amended and Restated By-Laws, as amended (incorporated by reference to Exhibit 3.2 of the Company’s Current Report on Form 8-K filed with the SEC on December 20, 2018)
~~31.1~~10.1		Amendment No. 3 to the Term Loan Credit Agreement dated as of November 15 , 2023, by and among the Company, certain subsidiaries of the Company and JPMorgan Chase Bank, N.A., as Administrative Agent and Term B-1 Lender
10.2		Amendment No. 3 to the ABL Credit Agreement, dated as of November 15, 2023, by and among the Company, certain domestic subsidiaries of the Company, certain subsidiaries of EHG organized under the laws of Germany and a subsidiary of EHG organized under the laws of the United Kingdom, the several lenders from time to time parties thereto and JPMorgan Chase Bank, N.A., as Administrative Agent
10.3		Form of Employment Agreement between the Company and Michele McDermott dated January 29, 2024 +
31.1		Chief Executive Officer’s Rule13a-14(a) Certification
31.2
~~31.2~~	Chief Financial Officer’s Rule13a-14(a) Certification
32.1
~~32.1~~	Chief Executive Officer’s Section 1350 Certification
32.2
~~32.2~~	Chief Financial Officer’s Section 1350 Certification
101.INS
~~101.INS~~	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
~~101.SCH~~	Inline XBRL Taxonomy Extension Schema Document
101.CAL
~~101.CAL~~	Inline XBRL Taxonomy Calculation Linkbase Document
101.PRE
~~101.PRE~~	Inline XBRL Taxonomy Presentation Linkbase Document
101.LAB
~~101.LAB~~	Inline XBRL Taxonomy Label Linkbase Document
101.DEF
~~101.DEF~~	Inline XBRL Taxonomy Extension Definition Linkbase Document
104		Cover Page Interactive Data File (formatted in inline XBRL and contained in Exhibit 101)

Attached as Exhibits 101 to this report are the following financial statements from the ~~Company’s~~Company's Quarterly report on Form10-Q for the quarter ended January 31, ~~2018~~2024 formatted in XBRL (“eXtensible Business Reporting Language”): (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income and Comprehensive Income, (iii) the Condensed Consolidated Statements of Cash Flows, (iv) the Condensed Consolidated Statements of Changes in Stockholders' Equity and ~~(iv)~~(v) related notes to these financial statements.


+			Designates management contract or compensatory plan or arrangement

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.

THOR INDUSTRIES, INC.

(Registrant)


DATE:		March 6, 2024	~~THOR INDUSTRIES, INC.~~
	~~(Registrant)~~

~~DATE: March 7, 2018~~	/s/ Robert W. Martin
			Robert W. Martin
			President and Chief Executive Officer

DATE:		March ~~7, 2018~~ 6, 2024		/s/ Colleen Zuhl
			Colleen Zuhl
			Senior Vice President and Chief Financial Officer


	January 31, 2018			July 31, 2017
ASSETS
Current assets:
Cash and cash equivalents	$	109,775		$	223,258
Accounts receivable, trade, net		598,908			453,754
Accounts receivable, other, net		25,177			31,090
Inventories, net		590,363			460,488
Prepaid expenses and other		9,979			11,577

Total current assets		1,334,202			1,180,167


Property, plant and equipment, net		466,215			425,238


Other assets:
Goodwill		377,693			377,693
Amortizable intangible assets, net		416,112			443,466
Deferred income taxes, net		69,657			92,969
Other		45,080			38,398

Total other assets		908,542			952,526

TOTAL ASSETS	$	2,708,959		$	2,557,931


LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	354,499		$	328,601
Accrued liabilities:
Compensation and related items		105,882			100,114
Product warranties		243,310			216,781
Income and other taxes		13,818			51,211
Promotions and rebates		51,717			46,459
Product, property and related liabilities		19,332			16,521
Other		28,559			21,359

Total current liabilities		817,117			781,046


Long-term debt		80,000			145,000
Unrecognized tax benefits		10,507			10,263
Other liabilities		53,406			45,082

Total long-term liabilities		143,913			200,345


Contingent liabilities and commitments

Stockholders’ equity:
Preferred stock – authorized 1,000,000 shares; none outstanding		—			—
Common stock – par value of $.10 per share; authorized 250,000,000 shares; issued 62,765,824 and 62,597,110 shares, respectively		6,277			6,260
Additionalpaid-in capital		245,390			235,525
Retained earnings		1,839,990			1,670,826
Less treasury shares of 10,070,459 and 10,011,069, respectively, at cost		(343,728	)		(336,071	)

Total stockholders’ equity		1,747,929			1,576,540

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,708,959		$	2,557,931


	Three Months Ended January 31,				Six Months Ended January 31,
	2018		2017		2018		2017
Net sales	$	1,971,560	$	1,588,525	$	4,203,228	$	3,297,056
Cost of products sold		1,701,232		1,376,823		3,599,715		2,848,602

Gross profit		270,328		211,702		603,513		448,454
Selling, general and administrative expenses		117,088		96,969		251,351		199,279
Amortization of intangible assets		13,796		15,279		27,354		33,494
Interest income		401		177		782		330
Interest expense		1,354		2,486		2,766		5,046
Other income, net		2,574		1,220		5,332		3,200

Income before income taxes		141,065		98,365		328,156		214,165
Income taxes		61,313		33,583		119,998		70,638

Net income and comprehensive income	$	79,752	$	64,782	$	208,158	$	143,527


Weighted-average common shares outstanding:
Basic		52,694,680		52,582,134		52,653,303		52,543,050
Diluted		52,861,140		52,740,959		52,839,752		52,723,450

Earnings per common share:
Basic	$	1.51	$	1.23	$	3.95	$	2.73
Diluted	$	1.51	$	1.23	$	3.94	$	2.72

Regular dividends declared and paid per common share	$	0.37	$	0.33	$	0.74	$	0.66


THOR INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE THREE AND SIX MONTHS ENDED JANUARY 31, 2024 AND 2023 (UNAUDITED)

	Three Months Ended January 31, 2024
								Accumulated					Stockholders’
				Additional				Other					Equity		Non-		Total
	Common Stock			Paid-In		Retained		Comprehensive		Treasury Stock			Attributable		controlling		Stockholders’
	Shares	Amount		Capital		Earnings		Income (Loss)		Shares	Amount		to THOR		Interests		Equity
Balance at November 1, 2023	66,686,498	$	6,669	$	551,491	$	4,119,589	$	(128,471)	13,480,026	$	(633,817)	$	3,915,461	$	8,129	$	3,923,590
Net income (loss)	—	—		—		7,217		—		—	—		7,217		(1,891)		5,326
Purchases of treasury shares	—	—		—		—		—		—	—		—		—		—
Restricted stock unit activity	173,240	17		(372)		—		—		55,167	(5,132)		(5,487)		—		(5,487)
Dividends $0.48 per common share	—	—		—		(25,596)		—		—	—		(25,596)		—		(25,596)
Stock-based compensation expense	—	—		9,246		—		—		—	—		9,246		—		9,246
Other comprehensive income (loss)	—	—		—		—		35,577		—	—		35,577		(61)		35,516


Balance at January 31, 2024	66,859,738	$	6,686	$	560,365	$	4,101,210	$	(92,894)	13,535,193	$	(638,949)	$	3,936,418	$	6,177	$	3,942,595

	Six Months Ended January 31, 2024
								Accumulated					Stockholders’
				Additional				Other					Equity		Non-		Total
	Common Stock			Paid-In		Retained		Comprehensive		Treasury Stock			Attributable		controlling		Stockholders’
	Shares	Amount		Capital		Earnings		Income (Loss)		Shares	Amount		to THOR		Interests		Equity
Balance at August 1, 2023	66,344,340	$	6,634	$	539,032	$	4,091,563	$	(68,547)	13,030,030	$	(592,667)	$	3,976,015	$	7,383	$	3,983,398
Net income (loss)	—	—		—		60,782		—		—	—		60,782		(423)		60,359
Purchases of treasury shares	—	—		—		—		—		327,876	(30,037)		(30,037)		—		(30,037)
Restricted stock unit activity	515,398	52		1,635		—		—		177,287	(16,245)		(14,558)		—		(14,558)
Dividends $0.96 per common share	—	—		—		(51,135)		—		—	—		(51,135)		—		(51,135)
Stock-based compensation expense	—	—		19,698		—		—		—	—		19,698		—		19,698
Other comprehensive income (loss)	—	—		—		—		(24,347)		—	—		(24,347)		(783)		(25,130)


Balance at January 31, 2024	66,859,738	$	6,686	$	560,365	$	4,101,210	$	(92,894)	13,535,193	$	(638,949)	$	3,936,418	$	6,177	$	3,942,595


Cash	$	18,409
Other current assets		258,158
Property, plant and equipment		80,824
Dealer network		261,100
Trademarks		92,800
Backlog		12,400
Goodwill		74,184
Current liabilities		(216,776	)

Total fair value of net assets acquired		581,099
Less cash acquired		(18,409	)

Total cash consideration for acquisition, less cash acquired	$	562,690



	Three Months Ended January 31,				Six Months Ended January 31,
Depreciation and intangible amortization expense:	2018		2017		2018		2017
Recreational vehicles
Towables	$	17,223	$	18,238	$	34,016	$	39,164
Motorized		2,909		2,246		5,637		4,589

Total recreational vehicles		20,132		20,484		39,653		43,753
Other		2,748		3,012		5,557		6,016
Corporate		395		314		763		636

Total	$	23,275	$	23,810	$	45,973	$	50,405


	Three Months Ended January 31,				Six Months Ended January 31,
Capital acquisitions:	2018		2017		2018		2017
Recreational vehicles
Towables	$	18,821	$	15,453	$	36,413	$	36,318
Motorized		1,754		6,889		14,069		12,045

Total recreational vehicles		20,575		22,342		50,482		48,363
Other		1,983		314		2,593		610
Corporate		7,016		1,141		8,591		1,317

Total	$	29,574	$	23,797	$	61,666	$	50,290


	Weighted-Average
	Remaining		January 31, 2018				July 31, 2017
	Life in Years at		Cost		Accumulated		Cost		Accumulated
	January 31, 2018		Cost		Amortization		Cost		Amortization
Dealer networks/customer relationships		16	$	404,960	$	124,519	$	404,960	$	101,795
Trademarks		18		147,617		21,434		147,617		17,570
Design technology and other intangibles		8		19,300		9,925		19,300		9,203
Non-compete agreements		1		450		337		450		293

Total amortizable intangible assets			$	572,327	$	156,215	$	572,327	$	128,861


For the fiscal year ending July 31, 2018	$	55,118
For the fiscal year ending July 31, 2019		50,043
For the fiscal year ending July 31, 2020		46,194
For the fiscal year ending July 31, 2021		42,860
For the fiscal year ending July 31, 2022		37,753
For the fiscal year ending July 31, 2023 and thereafter		211,498

	$	443,466


	Three Months Ended January 31, 2018					Three Months Ended January 31, 2017					Change Amount			% Change
NET SALES:
Recreational vehicles
Towables	$	1,373,118				$	1,082,249				$	290,869			26.9
Motorized		559,909					474,972					84,937			17.9

Total recreational vehicles		1,933,027					1,557,221					375,806			24.1
Other		68,013					53,891					14,122			26.2
Intercompany eliminations		(29,480	)				(22,587	)				(6,893	)		(30.5	)

Total	$	1,971,560				$	1,588,525				$	383,035			24.1


# OF UNITS:
Recreational vehicles
Towables		55,346					45,754					9,592			21.0
Motorized		6,735					5,831					904			15.5

Total		62,081					51,585					10,496			20.3


GROSS PROFIT:				% of Segment Net Sales					% of Segment Net Sales		Change Amount			% Change
Recreational vehicles
Towables	$	198,305			14.4	$	151,767			14.0	$	46,538			30.7
Motorized		62,961			11.2		50,288			10.6		12,673			25.2

Total recreational vehicles		261,266			13.5		202,055			13.0		59,211			29.3
Other, net		9,062			13.3		9,647			17.9		(585	)		(6.1	)

Total	$	270,328			13.7	$	211,702			13.3	$	58,626			27.7


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
Recreational vehicles
Towables	$	70,367			5.1	$	61,155			5.7	$	9,212			15.1
Motorized		24,309			4.3		20,868			4.4		3,441			16.5

Total recreational vehicles		94,676			4.9		82,023			5.3		12,653			15.4
Other		2,239			3.3		2,272			4.2		(33	)		(1.5	)
Corporate		20,173			—		12,674			—		7,499			59.2

Total	$	117,088			5.9	$	96,969			6.1	$	20,119			20.7


INCOME (LOSS) BEFORE INCOME TAXES:
Recreational vehicles
Towables	$	116,728			8.5	$	78,000			7.2	$	38,728			49.7
Motorized		37,538			6.7		28,488			6.0		9,050			31.8

Total recreational vehicles		154,266			8.0		106,488			6.8		47,778			44.9
Other, net		5,290			7.8		5,696			10.6		(406	)		(7.1	)
Corporate		(18,491	)		—		(13,819	)		—		(4,672	)		(33.8	)

Total	$	141,065			7.2	$	98,365			6.2	$	42,700			43.4


ORDER BACKLOG:	As of January 31, 2018		As of January 31, 2017		Change Amount		% Change
Recreational vehicles
Towables	$	1,816,520	$	1,323,451	$	493,069		37.3
Motorized		981,837		766,893		214,944		28.0

Total	$	2,798,357	$	2,090,344	$	708,013		33.9


ORDER BACKLOG:	As of January 31, 2024		As of January 31, 2023		Change Amount		% Change
Recreational vehicles
North American Towable	$	836,202	$	1,152,991	$	(316,789)	(27.5)
North American Motorized	1,072,687		1,848,124		(775,437)		(42.0)
Total North America	1,908,889		3,001,115		(1,092,226)		(36.4)
European	2,746,307		3,055,738		(309,431)		(10.1)
Total	$	4,655,196	$	6,056,853	$	(1,401,657)	(23.1)


	Three Months Ended January 31, 2018		% of Segment Net Sales		Three Months Ended January 31, 2017		% of Segment Net Sales		Change Amount		% Change
NET SALES:
Towables
Travel Trailers and Other	$	829,318		60.4	$	653,524		60.4	$	175,794		26.9
Fifth Wheels		543,800		39.6		428,725		39.6		115,075		26.8

Total Towables	$	1,373,118		100.0	$	1,082,249		100.0	$	290,869		26.9


	Three Months Ended January 31, 2018		% of Segment Shipments		Three Months Ended January 31, 2017		% of Segment Shipments		Change Amount		% Change
# OF UNITS:
Towables
Travel Trailers and Other		42,979		77.7		35,730		78.1		7,249		20.3
Fifth Wheels		12,367		22.3		10,024		21.9		2,343		23.4

Total Towables		55,346		100.0		45,754		100.0		9,592		21.0


	Six Months Ended January 31, 2018					Six Months Ended January 31, 2017					Change Amount			% Change
NET SALES:
Recreational vehicles
Towables	$	2,991,619				$	2,293,122				$	698,497			30.5
Motorized		1,126,520					936,426					190,094			20.3

Total recreational vehicles		4,118,139					3,229,548					888,591			27.5
Other		150,932					112,887					38,045			33.7
Intercompany eliminations		(65,843	)				(45,379	)				(20,464	)		(45.1	)

Total	$	4,203,228				$	3,297,056				$	906,172			27.5


# OF UNITS:
Recreational vehicles
Towables		121,441					96,928					24,513			25.3
Motorized		13,578					11,250					2,328			20.7

Total		135,019					108,178					26,841			24.8


GROSS PROFIT:				% of Segment Net Sales					% of Segment Net Sales		Change Amount			% Change
Recreational vehicles
Towables	$	455,018			15.2	$	326,745			14.2	$	128,273			39.3
Motorized		126,864			11.3		101,725			10.9		25,139			24.7

Total recreational vehicles		581,882			14.1		428,470			13.3		153,412			35.8
Other, net		21,631			14.3		19,984			17.7		1,647			8.2

Total	$	603,513			14.4	$	448,454			13.6	$	155,059			34.6


SELLING, GENERAL AND ADMINISTRATIVE EXPENSES:
Recreational vehicles
Towables	$	157,127			5.3	$	128,743			5.6	$	28,384			22.0
Motorized		51,017			4.5		42,182			4.5		8,835			20.9

Total recreational vehicles		208,144			5.1		170,925			5.3		37,219			21.8
Other		4,808			3.2		4,592			4.1		216			4.7
Corporate		38,399			—		23,762			—		14,637			61.6

Total	$	251,351			6.0	$	199,279			6.0	$	52,072			26.1


INCOME (LOSS) BEFORE INCOME TAXES:
Recreational vehicles
Towables	$	275,579			9.2	$	172,173			7.5	$	103,406			60.1
Motorized		75,124			6.7		57,411			6.1		17,713			30.9

Total recreational vehicles		350,703			8.5		229,584			7.1		121,119			52.8
Other, net		13,773			9.1		12,074			10.7		1,699			14.1
Corporate		(36,320	)		—		(27,493	)		—		(8,827	)		(32.1	)

Total	$	328,156			7.8	$	214,165			6.5	$	113,991			53.2


	Six Months Ended January 31, 2018		% of Segment Net Sales		Six Months Ended January 31, 2017		% of Segment Net Sales		Change Amount		% Change
NET SALES:
Towables
Travel Trailers and Other	$	1,822,922		60.9	$	1,376,873		60.0	$	446,049		32.4
Fifth Wheels		1,168,697		39.1		916,249		40.0		252,448		27.6

Total Towables	$	2,991,619		100.0	$	2,293,122		100.0	$	698,497		30.5


	Six Months Ended January 31, 2018		% of Segment Shipments		Six Months Ended January 31, 2017		% of Segment Shipments		Change Amount		% Change
# OF UNITS:
Towables
Travel Trailers and Other		94,647		77.9		75,374		77.8		19,273		25.6
Fifth Wheels		26,794		22.1		21,554		22.2		5,240		24.3

Total Towables		121,441		100.0		96,928		100.0		24,513		25.3