Cover Page
Cover Page - shares | 6 Months Ended | |
Feb. 25, 2023 | Mar. 16, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Feb. 25, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-06403 | |
Entity Registrant Name | WINNEBAGO INDUSTRIES, INC. | |
Entity Incorporation, State or Country Code | MN | |
Entity Tax Identification Number | 42-0802678 | |
Entity Address, Address Line One | 13200 Pioneer Trail | |
Entity Address, City or Town | Eden Prairie | |
Entity Address, State or Province | MN | |
Entity Address, Postal Zip Code | 55347 | |
City Area Code | 952 | |
Local Phone Number | 829-8600 | |
Title of each class | Common Stock, $0.50 par value per share | |
Trading Symbol(s) | WGO | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 30,556,243 | |
Entity Central Index Key | 0000107687 | |
Current Fiscal Year End Date | --08-26 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Income Statement [Abstract] | ||||
Net revenues | $ 866.7 | $ 1,164.7 | $ 1,818.9 | $ 2,320.5 |
Cost of goods sold | 719.9 | 948.1 | 1,511.7 | 1,874.5 |
Gross profit | 146.8 | 216.6 | 307.2 | 446 |
Selling, general, and administrative expenses | 66.2 | 71.8 | 136.9 | 146.7 |
Amortization | 3.8 | 8 | 7.6 | 16.2 |
Total operating expenses | 70 | 79.8 | 144.5 | 162.9 |
Operating income | 76.8 | 136.8 | 162.7 | 283.1 |
Interest expense, net | 5.3 | 10.3 | 11.2 | 20.6 |
Non-operating loss | 1.8 | 6.5 | 2.1 | 12.8 |
Income before income taxes | 69.7 | 120 | 149.4 | 249.7 |
Provision for income taxes | 16.9 | 28.8 | 36.4 | 58.9 |
Net income | $ 52.8 | $ 91.2 | $ 113 | $ 190.8 |
Earnings per common share: | ||||
Basic (in dollars per share) | $ 1.73 | $ 2.75 | $ 3.71 | $ 5.75 |
Diluted (in dollars per share) | $ 1.52 | $ 2.69 | $ 3.25 | $ 5.58 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 30.5 | 33.1 | 30.5 | 33.2 |
Diluted (in shares) | 35.5 | 33.9 | 35.5 | 34.2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Current assets | ||
Cash and cash equivalents | $ 229.3 | $ 282.2 |
Receivables, less allowance for doubtful accounts ($0.5 and $0.6, respectively) | 281.3 | 254.1 |
Inventories, net | 540.4 | 525.8 |
Prepaid expenses and other current assets | 38.5 | 31.7 |
Total current assets | 1,089.5 | 1,093.8 |
Property, plant, and equipment, net | 310.4 | 276.2 |
Goodwill | 484.2 | 484.2 |
Other intangible assets, net | 464.8 | 472.4 |
Investment in life insurance | 29 | 28.6 |
Operating lease assets | 42.2 | 41.1 |
Deferred income tax assets, net | 6.1 | 0 |
Other long-term assets | 19.2 | 20.4 |
Total assets | 2,445.4 | 2,416.7 |
Current liabilities | ||
Accounts payable | 165 | 217.5 |
Income taxes payable | 0 | 0.7 |
Accrued expenses: | ||
Accrued compensation | 42.4 | 71.6 |
Product warranties | 113.7 | 127.9 |
Self-insurance | 21.4 | 21.4 |
Promotional | 36.1 | 21.5 |
Accrued interest and dividends | 4.6 | 13 |
Other current liabilities | 51.9 | 48.5 |
Total current liabilities | 435.1 | 522.1 |
Long-term debt, net | 591 | 545.9 |
Deferred income tax liabilities, net | 0 | 6.1 |
Unrecognized tax benefits | 6 | 5.7 |
Long-term operating lease liabilities | 41.7 | 40.4 |
Deferred compensation benefits, net of current portion | 8.2 | 8.1 |
Other long-term liabilities | 26.1 | 25.4 |
Total liabilities | 1,108.1 | 1,153.7 |
Contingent liabilities and commitments (Note 11) | ||
Shareholders' equity: | ||
Preferred stock, par value $0.01: 10.0 shares authorized; Zero shares issued and outstanding | 0 | 0 |
Common stock, par value $0.50: 120.0 shares authorized; 51.8 shares issued | 25.9 | 25.9 |
Additional paid-in capital | 193.9 | 256.3 |
Retained earnings | 1,671 | 1,537.5 |
Accumulated other comprehensive loss | (0.4) | (0.5) |
Treasury stock, at cost: 21.2 and 21.5 shares, respectively | (553.1) | (556.2) |
Total shareholders' equity | 1,337.3 | 1,263 |
Total liabilities and shareholders' equity | $ 2,445.4 | $ 2,416.7 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Current assets | ||
Allowance for doubtful accounts | $ 0.5 | $ 0.6 |
Shareholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 500,000 | $ 500,000 |
Common stock, shares authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (in shares) | 51,800,000 | 51,800,000 |
Treasury stock, at cost, shares (in shares) | 21,200,000 | 21,500,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Feb. 25, 2023 | Feb. 26, 2022 | |
Operating activities | ||
Net income | $ 113 | $ 190.8 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation | 13.3 | 10.8 |
Amortization | 7.6 | 16.2 |
Non-cash interest expense, net | 0 | 7.3 |
Amortization of debt issuance costs | 1.5 | 1.2 |
Last in, first-out expense | 1.7 | 2.8 |
Stock-based compensation | 6.5 | 6.9 |
Deferred income taxes | (1.5) | (2) |
Contingent consideration fair value adjustment | 2 | 12.9 |
Other, net | 0 | 2.2 |
Change in operating assets and liabilities, net of assets and liabilities acquired | ||
Receivables, net | (27.2) | (123.6) |
Inventories, net | (16.3) | (109.3) |
Prepaid expenses and other assets | 0.4 | 5.6 |
Accounts payable | (50.1) | 26.7 |
Income taxes and unrecognized tax benefits | (5.4) | (7.9) |
Accrued expenses and other liabilities | (28.7) | 5.5 |
Net cash provided by operating activities | 16.8 | 46.1 |
Investing activities | ||
Purchases of property, plant, and equipment | (49.4) | (43.4) |
Acquisition of business, net of cash acquired | 0 | (228.2) |
Other, net | 0.8 | (0.2) |
Net cash used in investing activities | (48.6) | (271.8) |
Financing activities | ||
Borrowings on long-term debt | 1,808.5 | 1,943.6 |
Repayments on long-term debt | (1,808.5) | (1,943.6) |
Payments of cash dividends | (16.8) | (12) |
Payments for repurchases of common stock | (4.9) | (64.2) |
Other, net | 0.6 | 2.1 |
Net cash used in financing activities | (21.1) | (74.1) |
Net decrease in cash and cash equivalents | (52.9) | (299.8) |
Cash and cash equivalents at beginning of period | 282.2 | 434.6 |
Cash and cash equivalents at end of period | 229.3 | 134.8 |
Supplemental Disclosures | ||
Income taxes paid, net | 42 | 71.3 |
Interest paid | 12.1 | 11.9 |
Non-cash investing and financing activities | ||
Issuance of common stock for acquisition of business | 0 | 22 |
Capital expenditures in accounts payable | 4.5 | 1.1 |
Increase in lease assets in exchange for lease liabilities: | ||
Operating leases | 3.5 | 17.2 |
Finance leases | $ 0 | $ 1.7 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Adoption of Accounting Standards Update (ASU) 2020-06 | Common Shares | Additional Paid-In Capital | Additional Paid-In Capital Adoption of Accounting Standards Update (ASU) 2020-06 | Retained Earnings | Retained Earnings Adoption of Accounting Standards Update (ASU) 2020-06 | Accumulated Other Comprehensive Income (Loss) | Treasury Stock |
Beginning balance (in shares) at Aug. 28, 2021 | 51.8 | ||||||||
Beginning balance at Aug. 28, 2021 | $ 1,056.9 | $ 25.9 | $ 218.5 | $ 1,173 | $ (0.5) | $ (360) | |||
Treasury stock, beginning balance (in shares) at Aug. 28, 2021 | (18.7) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | 6.9 | 6.9 | |||||||
Issuance of stock for employee benefit and stock-based awards, net | 2.6 | (1.9) | $ 4.5 | ||||||
Issuance of stock for employee benefit and stock-based awards, net (in shares) | 0.2 | ||||||||
Issuance of stock for acquisition | 22 | 14.7 | $ 7.3 | ||||||
Issuance of stock for acquisition (in shares) | 0.4 | ||||||||
Repurchase of common stock (in shares) | (0.9) | ||||||||
Repurchase of common stock | (64.2) | $ (64.2) | |||||||
Common stock dividends | (6.1) | (6.1) | |||||||
Other | 0.1 | 0.1 | |||||||
Net income | 190.8 | 190.8 | |||||||
Ending balance (in shares) at Feb. 26, 2022 | 51.8 | ||||||||
Ending balance at Feb. 26, 2022 | 1,209 | $ 25.9 | 238.2 | 1,357.8 | (0.5) | $ (412.4) | |||
Treasury stock, ending balance (in shares) at Feb. 26, 2022 | (19) | ||||||||
Beginning balance (in shares) at Aug. 28, 2021 | 51.8 | ||||||||
Beginning balance at Aug. 28, 2021 | 1,056.9 | $ 25.9 | 218.5 | 1,173 | (0.5) | $ (360) | |||
Treasury stock, beginning balance (in shares) at Aug. 28, 2021 | (18.7) | ||||||||
Ending balance (in shares) at Aug. 27, 2022 | 51.8 | ||||||||
Ending balance at Aug. 27, 2022 | $ 1,263 | $ (33) | $ 25.9 | 256.3 | $ (62) | 1,537.5 | $ 29 | (0.5) | $ (556.2) |
Treasury stock, ending balance (in shares) at Aug. 27, 2022 | (21.5) | (21.5) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Accounting standards update, extensible enumeration | Accounting Standards Update 2020-06 | ||||||||
Beginning balance (in shares) at Nov. 27, 2021 | 51.8 | ||||||||
Beginning balance at Nov. 27, 2021 | $ 1,159.3 | $ 25.9 | 233.8 | 1,272.7 | (0.5) | $ (372.6) | |||
Treasury stock, beginning balance (in shares) at Nov. 27, 2021 | (18.5) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | 4.2 | 4.2 | |||||||
Issuance of stock for employee benefit and stock-based awards, net | 0.9 | 0.2 | $ 0.7 | ||||||
Issuance of stock for employee benefit and stock-based awards, net (in shares) | 0.1 | ||||||||
Repurchase of common stock (in shares) | (0.6) | ||||||||
Repurchase of common stock | (40.5) | $ (40.5) | |||||||
Common stock dividends | (6.1) | (6.1) | |||||||
Net income | 91.2 | 91.2 | |||||||
Ending balance (in shares) at Feb. 26, 2022 | 51.8 | ||||||||
Ending balance at Feb. 26, 2022 | 1,209 | $ 25.9 | 238.2 | 1,357.8 | (0.5) | $ (412.4) | |||
Treasury stock, ending balance (in shares) at Feb. 26, 2022 | (19) | ||||||||
Beginning balance (in shares) at Aug. 27, 2022 | 51.8 | ||||||||
Beginning balance at Aug. 27, 2022 | $ 1,263 | $ (33) | $ 25.9 | 256.3 | $ (62) | 1,537.5 | $ 29 | (0.5) | $ (556.2) |
Treasury stock, beginning balance (in shares) at Aug. 27, 2022 | (21.5) | (21.5) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | $ 6.5 | 6.5 | |||||||
Issuance of stock for employee benefit and stock-based awards, net | 1.1 | (6.9) | $ 8 | ||||||
Issuance of stock for employee benefit and stock-based awards, net (in shares) | 0.4 | ||||||||
Repurchase of common stock (in shares) | (0.1) | ||||||||
Repurchase of common stock | (4.9) | $ (4.9) | |||||||
Common stock dividends | (8.5) | (8.5) | |||||||
Total comprehensive income | 0.1 | 0.1 | |||||||
Net income | 113 | 113 | |||||||
Ending balance (in shares) at Feb. 25, 2023 | 51.8 | ||||||||
Ending balance at Feb. 25, 2023 | $ 1,337.3 | $ 25.9 | 193.9 | 1,671 | (0.4) | $ (553.1) | |||
Treasury stock, ending balance (in shares) at Feb. 25, 2023 | (21.2) | (21.2) | |||||||
Beginning balance (in shares) at Nov. 26, 2022 | 51.8 | ||||||||
Beginning balance at Nov. 26, 2022 | $ 1,288.6 | $ 25.9 | 191.2 | 1,626.7 | (0.5) | $ (554.7) | |||
Treasury stock, beginning balance (in shares) at Nov. 26, 2022 | (21.3) | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Stock-based compensation | 3.5 | 3.5 | |||||||
Issuance of stock for employee benefit and stock-based awards, net | 1.2 | (0.8) | $ 2 | ||||||
Issuance of stock for employee benefit and stock-based awards, net (in shares) | 0.1 | ||||||||
Repurchase of common stock (in shares) | 0 | ||||||||
Repurchase of common stock | (0.4) | $ (0.4) | |||||||
Common stock dividends | (8.5) | (8.5) | |||||||
Total comprehensive income | 0.1 | 0.1 | |||||||
Net income | 52.8 | 52.8 | |||||||
Ending balance (in shares) at Feb. 25, 2023 | 51.8 | ||||||||
Ending balance at Feb. 25, 2023 | $ 1,337.3 | $ 25.9 | $ 193.9 | $ 1,671 | $ (0.4) | $ (553.1) | |||
Treasury stock, ending balance (in shares) at Feb. 25, 2023 | (21.2) | (21.2) |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||
Common stock dividends (in dollars per share) | $ 0.27 | $ 0.18 | $ 0.27 | $ 0.18 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Feb. 25, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The consolidated financial statements include the accounts of Winnebago Industries, Inc. and its wholly owned subsidiaries. Significant intercompany account balances and transactions have been eliminated. The use of the terms "Winnebago Industries," "Winnebago," "we," "our," and "us" in this Quarterly Report on Form 10-Q, unless the context otherwise requires, refers to Winnebago Industries, Inc. and its wholly owned subsidiaries. The interim unaudited consolidated financial statements included herein are prepared pursuant to the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”). The information furnished in these consolidated financial statements includes normal recurring adjustments, unless noted otherwise in the Notes to Consolidated Financial Statements, and reflects all adjustments that are, in management’s opinion, necessary for a fair presentation of such financial statements. The consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). GAAP requires us to make estimates and assumptions that affect amounts reported. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations. The consolidated financial statements included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 filed with the SEC. Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year ending August 26, 2023. Comprehensive Income Comprehensive income refers to the change in stockholders’ equity from transactions and other events and circumstances from non-owner sources. As of February 25, 2023 and February 26, 2022, the difference between comprehensive income and net income was not material. Change in Presentation In the first quarter of Fiscal 2023, we changed our presentation in tables from thousands to millions, unless otherwise designated. As a result, certain rounding adjustments have been made to prior period disclosed amounts in order to conform to the current year presentation. In addition, certain prior period amounts may not recalculate due to rounding. These changes were not significant, and no other updates were made to previously reported financial information. Subsequent Events In preparing the accompanying unaudited consolidated financial statements, we have evaluated subsequent events for potential recognition and disclosure through the date of this filing noting no material subsequent events. Recently Adopted Accounting Pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) which reduces the number of models used to account for convertible instruments, amends diluted earnings per share ("EPS") calculations for convertible instruments, and amends the requirements for a contract (or embedded derivative) that is potentially settled in an entity's own shares to be classified in equity. Certain disclosure requirements were also added to increase transparency and decision-usefulness regarding a convertible instrument's terms and features. Additionally, the if-converted method must be used for including convertible instruments in diluted EPS as opposed to the treasury stock method. We adopted the new guidance in the first quarter of Fiscal 2023 using the modified retrospective approach, resulting in a decrease to additional paid-in capital of $62.0 million, an increase to long-term debt of $43.8 million, a decrease in the deferred income tax liability of $10.8 million, and an increase to beginning retained earnings of $29.0 million. In addition, the adoption of the amended guidance reduced our non-cash interest expense by $3.7 million (pre-tax) for the three months ended February 25, 2023 and $7.3 million (pre-tax) for the six months ended February 25, 2023. The if-converted method will be used prospectively to calculate the impact of our convertible instruments on diluted EPS. Under the if-converted method, the 4.7 million shares underlying our convertible instruments are assumed to have been outstanding at the beginning of the reporting period, and any interest expense related to these instruments is excluded from the calculation of diluted EPS. Refer to Note 15 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for more information on the change from the treasury stock method to the if-converted method. |
Business Combinations
Business Combinations | 6 Months Ended |
Feb. 25, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations On August 31, 2021, we purchased 100% of the equity interests of Barletta Boat Company, LLC and Three Limes, LLC (collectively, "Barletta"), a manufacturer of high-quality, premium pontoon boats that are sold through a network of independent authorized dealers. We acquired Barletta for a purchase price of $286.3 million, including cash payments of $240.1 million, $25.0 million in common stock issued to the sellers (subject to a discount noted below), and contingent consideration from earnout provisions. The common stock fair value included in the purchase price reflects a 12% discount, due to the lack of marketability as these are unregistered shares that have a one-year lockup restriction, which reduced the value of the common stock to $22.0 million. The contingent consideration includes both a potential stock payout as well as a potential cash payment based on achievement of certain financial performance metrics over the next few years. The maximum payout under the earnout is $50.0 million in cash and $15.0 million in stock if all metrics are achieved. The fair value of the earnout as of August 31, 2021 was $24.2 million. As of February 25, 2023 and August 27, 2022, the fair value of the earnout was $41.8 million and $39.8 million, respectively. The portion of the earnout liability that will be settled within a year is included in other current liabilities on the Consolidated Balance Sheets, and the remaining earnout liability is included in other long-term liabilities on the Consolidated Balance Sheets. As of February 25, 2023 and August 27, 2022, $21.9 million and $21.3 million was included in other current liabilities, respectively, and $19.9 million and $18.5 million was included in other long-term liabilities on the Consolidated Balance Sheets, respectively. The total purchase price was allocated to the acquired net tangible and intangible assets of Barletta, based on their preliminary fair values at the date of the acquisition. This resulted in the recognition of goodwill of $136.1 million and other intangible assets of $111.4 million. Goodwill from the Barletta acquisition is recognized in our Marine segment. The other intangible assets acquired include a trade name, dealer network, and backlog. The trade name has an indefinite life, while the dealer network is being amortized on a straight line basis over 12 years. The backlog, which was being amortized over 10 months, was fully amortized as of August 27, 2022. We finalized the allocation of the purchase price in the third quarter of Fiscal 2022. Total transaction costs related to the Barletta acquisition were $3.1 million, of which $2.4 million were expensed during the first quarter of Fiscal 2022. Transaction costs were included in selling, general and administrative expenses in the accompanying Consolidated Statements of Income. |
Business Segments
Business Segments | 6 Months Ended |
Feb. 25, 2023 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments We have seven operating segments: 1) Grand Design towables, 2) Winnebago towables, 3) Winnebago motorhomes, 4) Newmar motorhomes, 5) Chris-Craft marine, 6) Barletta marine and 7) Winnebago specialty vehicles. Financial performance is evaluated based on each operating segment's Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA"), as defined below, which excludes certain corporate administration expenses and non-operating income and expense. Our three reportable segments are: Towable (an aggregation of the Grand Design towables and the Winnebago towables operating segments); Motorhome (an aggregation of the Winnebago motorhomes and Newmar motorhomes operating segments); and Marine (an aggregation of the Chris-Craft marine and Barletta marine operating segments). Towable is comprised of non-motorized products that are generally towed by another vehicle, along with other related manufactured products and services. Motorhome is comprised of products that include a motorized chassis, along with other related manufactured products and services. Marine is comprised of products that include boats, along with other related manufactured products and services. The Corporate / All Other category includes the Winnebago specialty vehicles operating segment as well as certain corporate administration expenses related to the oversight of the enterprise, such as corporate leadership and administration costs. Identifiable assets of the reportable segments exclude general corporate assets, which principally consist of cash and cash equivalents and certain deferred tax balances. The general corporate assets are included in the Corporate / All Other category. Our Chief Executive Officer (the Chief Operating Decision Maker ("CODM")) regularly reviews consolidated financial results in their entirety and operating segment financial information through Adjusted EBITDA and has ultimate responsibility for enterprise decisions. Our CODM is responsible for allocating resources and assessing performance of the consolidated enterprise, reportable segments and between operating segments. Management of each operating segment has responsibility for operating decisions, allocating resources and assessing performance within their respective operating segment. The accounting policies of all reportable segments are the same as those described in Note 1 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended August 27, 2022. We monitor and evaluate operating performance of our reportable segments based on Adjusted EBITDA. We believe disclosing Adjusted EBITDA is useful to securities analysts, investors and other interested parties when evaluating companies in our industries. EBITDA is defined as net income before interest expense, provision for income taxes, and depreciation and amortization expense. Adjusted EBITDA is defined as net income before interest expense, provision for income taxes, depreciation and amortization expense, and other pretax adjustments made in order to present comparable results period over period. Examples of items excluded from Adjusted EBITDA include acquisition-related costs, litigation reserves, contingent consideration fair value adjustment, and non-operating income or loss. Financial information by reportable segment is as follows: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Net Revenues Towable $ 342.5 $ 646.6 $ 689.8 $ 1,297.6 Motorhome 403.8 417.6 868.0 839.0 Marine 112.9 97.3 244.3 176.6 Corporate / All Other 7.5 3.2 16.8 7.3 Consolidated $ 866.7 $ 1,164.7 $ 1,818.9 $ 2,320.5 Adjusted EBITDA Towable $ 39.3 $ 100.6 $ 75.6 $ 212.7 Motorhome 42.5 46.1 92.8 96.2 Marine 14.4 13.0 32.9 23.5 Corporate / All Other (7.8) (9.0) (15.9) (14.4) Consolidated $ 88.4 $ 150.7 $ 185.4 $ 318.0 Capital Expenditures Towable $ 6.2 $ 10.2 $ 20.5 $ 21.3 Motorhome 9.0 7.9 14.8 15.6 Marine 5.3 1.9 12.6 2.5 Corporate / All Other 1.1 0.2 1.5 4.0 Consolidated $ 21.6 $ 20.2 $ 49.4 $ 43.4 (in millions) February 25, August 27, Assets Towable $ 871.4 $ 874.9 Motorhome 856.9 823.4 Marine 443.6 416.1 Corporate / All Other 273.5 302.3 Consolidated $ 2,445.4 $ 2,416.7 Reconciliation of net income to consolidated Adjusted EBITDA is as follows: Three Months Ended Six Months Ended (in millions) February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022 Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Interest expense, net 5.3 10.3 11.2 20.6 Provision for income taxes 16.9 28.8 36.4 58.9 Depreciation 6.7 5.5 13.3 10.8 Amortization 3.8 8.0 7.6 16.2 EBITDA 85.5 143.8 181.5 297.3 Acquisition-related costs 1.1 0.4 1.7 3.8 Litigation reserves — — — 4.0 Contingent consideration fair value adjustment 1.6 6.5 2.0 12.9 Non-operating loss 0.2 — 0.2 — Adjusted EBITDA $ 88.4 $ 150.7 $ 185.4 $ 318.0 |
Investments and Fair Value Meas
Investments and Fair Value Measurements | 6 Months Ended |
Feb. 25, 2023 | |
Fair Value Disclosures [Abstract] | |
Investments and Fair Value Measurements | Investments and Fair Value Measurements In determining the fair value of financial assets and liabilities, we utilize market data or other assumptions that we believe market participants would use in pricing the asset or liability in the principal or most advantageous market and adjust for non-performance and/or other risks associated with us as well as counterparties, as appropriate. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date: Level 1 — Unadjusted quoted prices which are available in active markets for identical assets or liabilities accessible at the measurement date. Level 2 — Inputs other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 — Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at the measurement date. Assets and Liabilities that are Measured at Fair Value on a Recurring Basis Financial assets and liabilities measured at fair value on a recurring basis are as follows: Fair Value at Fair Value Hierarchy (in millions) February 25, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.7 $ 1.7 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds — — — — Total assets at fair value $ 1.8 $ 1.8 $ — $ — Contingent consideration Earnout liability $ 41.8 $ — $ — $ 41.8 Total liabilities at fair value $ 41.8 $ — $ — $ 41.8 Fair Value at Fair Value Hierarchy (in millions) August 27, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.2 $ 1.2 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds 0.1 0.1 — — Total assets at fair value $ 1.4 $ 1.4 $ — $ — Contingent consideration Earnout liability $ 39.8 $ — $ — $ 39.8 Total liabilities at fair value $ 39.8 $ — $ — $ 39.8 Assets that Fund Deferred Compensation Our assets that fund deferred compensation are marketable equity securities measured at fair value using quoted market prices and primarily consist of equity-based mutual funds. These securities, used to fund the Executive Share Option Plan and the Executive Deferred Compensation Plan, are classified as Level 1 as they are traded in an active market for which closing stock prices are readily available. Refer to Note 11 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 for additional information regarding these plans. The proportion of the assets that will fund options which expire within a year are included in prepaid expenses and other current assets on the Consolidated Balance Sheets. The remaining assets are classified as non-current and are included in other assets on the Consolidated Balance Sheets. Contingent Consideration Contingent consideration represents the earnout liability related to the Barletta acquisition and is valued using a probability-weighted scenario analysis of projected gross profit results and discounted at a risk-free rate. The contingent consideration is classified as Level 3. Actual gross profit results may differ significantly from those used in the estimate above, which may affect future payments. Changes in future payments will be reflected in future operating results as they occur. The following table provides a reconciliation of the beginning and ending balances of the contingent consideration: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Beginning fair value - contingent consideration $ 40.2 $ 30.6 $ 39.8 $ — Additions — — — 24.2 Fair value adjustments 1.6 6.5 2.0 12.9 Ending fair value - contingent consideration $ 41.8 $ 37.1 $ 41.8 $ 37.1 The fair value of the earnout liability that will be settled within a year is included in other current liabilities on the Consolidated Balance Sheets. The remaining earnout liability is included in other long-term liabilities on the Consolidated Balance Sheets. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain financial instruments are measured at fair value on a nonrecurring basis. These assets primarily include goodwill, intangible assets, property, plant and equipment, and right-of-use lease assets. These assets were originally recognized at amounts equal to the fair value determined at date of acquisition or purchase. If certain triggering events occur, or if an annual impairment test is required, we will evaluate the non-financial asset for impairment. If an impairment has occurred, the asset will be written down to its current estimated fair value. No impairments were recorded for non-financial assets in the six months ended February 25, 2023 or February 26, 2022. Assets and Liabilities Not Measured at Fair Value Certain financial instruments are not measured at fair value but are recorded at carrying amounts approximating fair value based on their short-term nature. These financial instruments include cash and cash equivalents, receivables, accounts payable, other payables, and long-term debt. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. The fair value of our long-term debt was determined using current quoted prices in active markets for our publicly traded debt obligations, which is classified as Level 1 in the fair value hierarchy. See Note 9 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for the fair value of our long-term debt. |
Inventories
Inventories | 6 Months Ended |
Feb. 25, 2023 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following: (in millions) February 25, August 27, Finished goods $ 89.8 $ 59.3 Work-in-process 183.4 198.9 Raw materials 316.3 315.0 Total 589.5 573.2 Less: Excess of FIFO over LIFO cost 49.1 47.4 Inventories, net $ 540.4 $ 525.8 Inventory valuation methods consist of the following: (in millions) February 25, August 27, LIFO basis $ 260.4 $ 212.3 First-in, first-out basis 329.1 360.9 Total $ 589.5 $ 573.2 |
Property, Plant, and Equipment
Property, Plant, and Equipment | 6 Months Ended |
Feb. 25, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment | Property, Plant, and Equipment Property, plant, and equipment is stated at cost, net of accumulated depreciation, and consists of the following: (in millions) February 25, August 27, Land $ 14.6 $ 14.6 Buildings and building improvements 201.6 171.0 Machinery and equipment 150.8 142.6 Software 44.1 43.8 Transportation 6.7 6.5 Construction in progress 83.9 76.8 Property, plant, and equipment, gross 501.7 455.3 Less: Accumulated depreciation 191.3 179.1 Property, plant, and equipment, net $ 310.4 $ 276.2 Depreciation expense was $6.7 million and $5.5 million for the three months ended February 25, 2023 and February 26, 2022, respectively; and $13.3 million and $10.8 million for the six months ended February 25, 2023 and February 26, 2022, respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Feb. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The changes in the carrying amount of goodwill by reportable segment, with no accumulated impairment losses, for the six months ended February 25, 2023 and February 26, 2022 are as follows: (in millions) Towable Motorhome Marine Total Balances at August 28, 2021 $ 244.7 $ 73.1 $ 30.3 $ 348.1 Acquisition of Barletta (1) — — 136.1 136.1 Balances at February 26, 2022 $ 244.7 $ 73.1 $ 166.4 $ 484.2 Balances at August 27, 2022 and February 25, 2023 (2) $ 244.7 $ 73.1 $ 166.4 $ 484.2 (1) The change in marine activity is related to the acquisition of Barletta that occurred on August 31, 2021. See Note 2 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q. (2) There was no activity in the six months ended February 25, 2023. Other intangible assets, net of accumulated amortization, consist of the following: February 25, 2023 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Value Trade names $ 352.3 $ 352.3 Dealer networks 180.0 $ 67.9 112.1 Backlog 42.3 42.3 — Non-compete agreements 6.6 6.2 0.4 Other intangible assets $ 581.2 $ 116.4 $ 464.8 August 27, 2022 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Value Trade names $ 352.3 $ 352.3 Dealer networks 180.0 $ 60.5 119.5 Backlog 42.3 42.3 — Non-compete agreements 6.6 6.0 0.6 Other intangible assets $ 581.2 $ 108.8 $ 472.4 The weig hted average remaining amortization period for intangible assets as of February 25, 2023 was approximatel y eight years . Estimated future amortization expense related to finite-lived intangible assets is as follows: (in millions) Amortization Remainder of Fiscal 2023 $ 7.6 Fiscal 2024 15.1 Fiscal 2025 14.9 Fiscal 2026 14.9 Fiscal 2027 14.9 Fiscal 2028 14.9 Thereafter 30.2 Total amortization expense remaining $ 112.5 |
Product Warranties
Product Warranties | 6 Months Ended |
Feb. 25, 2023 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | Product Warranties We provide certain service and warranty on our products. From time to time, we also voluntarily incur costs for certain warranty-type expenses occurring after the normal warranty period expires to help protect the reputation of our products and maintain the goodwill of our customers. Estimated costs related to product warranty are accrued at the time of sale and are based upon historical warranty and service claims experience. Adjustments are made to accruals as claim data and cost experience becomes available. In addition to the costs associated with the contractual warranty coverage provided on products, we also occasionally incur costs as a result of additional service actions not covered by warranties, including product recalls and customer satisfaction actions. Although we estimate and reserve for the cost of these service actions when probable and estimable, there can be no assurance that expense levels will remain at current levels or such reserves will continue to be adequate. Changes in the product warranty liability are as follows: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Balance at beginning of period $ 122.2 $ 102.4 $ 127.9 $ 91.2 Business acquisition (1) — — — 4.7 Provision 16.0 31.2 34.1 57.2 Claims paid (24.5) (19.8) (48.3) (39.3) Balance at end of period $ 113.7 $ 113.8 $ 113.7 $ 113.8 (1) Relates to the acquisition of Barletta on August 31, 2021. See Note 2 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Feb. 25, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt Long-term debt consists of the following: (in millions) February 25, August 27, ABL Credit Facility $ — $ — Senior Secured Notes 300.0 300.0 Convertible Notes 300.0 300.0 Long-term debt, gross 600.0 600.0 Convertible Notes unamortized interest discount (1) — (45.3) Debt issuance costs, net (9.0) (8.8) Long-term debt, net $ 591.0 $ 545.9 (1) In connection with the adoption of ASU 2020-06, the unamortized interest discount was derecognized in the first quarter of Fiscal 2023. Refer to Note 1 in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional information. Credit Agreements On July 15, 2022, we amended and restated our existing asset-backed revolving credit agreement ("ABL Credit Facility") to, among other things, increase the commitments available from $192.5 million to $350.0 million, and extend the maturity date from October 22, 2024 to July 15, 2027 (subject to certain factors which may accelerate the maturity date). The $350.0 million credit facility is on a revolving basis, subject to availability under a borrowing base consisting of eligible accounts receivable and eligible inventory. The ABL Credit Facility is available for issuance of letters of credit to a specified limit of $35.0 million. We pay a commitment fee of 0.25% based on the average daily amount of the facility available, but unused during the most recent quarter. We can elect to base the interest rate on various rates plus specific spreads depending on the borrowing amount outstanding. If drawn, interest on ABL Credit Facility borrowings is at a floating rate based upon our election, either term SOFR or REVSOFR30 (as defined in the ABL Credit Facility agreement), plus, in each case, a credit spread adjustment of 0.10%, as well as an applicable spread between 1.25% and 1.75%, depending on the usage of the facility during the most recent quarter. Based on current usage, we would pay an applicable spread of 1.25%. In connection with the amendment, we capitalized $1.2 million of issuance costs that will be amortized over the five-year term of the ABL Credit Facility. On July 8, 2020, we closed our private offering (the “Senior Secured Notes Offering”) of $300.0 million aggregate principal amount of 6.25% Senior Secured Notes due 2028 (the “Senior Secured Notes”). The Senior Secured Notes were issued in accordance with an Indenture dated as of July 8, 2020 (the “Indenture”). The Senior Secured Notes will mature on July 15, 2028 unless earlier redeemed or repurchased. Interest on the Senior Secured Notes accrues starting July 8, 2020 and is payable semi-annually in arrears on January 15 and July 15 of each year, which began on January 15, 2021. Debt issuance costs incurred and capitalized are amortized on a straight-line basis over the term of the associated debt agreement. If early principal payments are made on the Senior Secured Notes, a proportional amount of the unamortized debt issuance costs is expensed. As part of the Senior Secured Notes Offering, we capitalized $7.5 million in debt issuance costs that will be amortized over the eight-year term of the agreement. Refer to Note 9 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 for additional information regarding these credit agreements. Convertible Notes On November 1, 2019, we issued $300.0 million in aggregate principal amount of 1.5% unsecured convertible senior notes due 2025 (“Convertible Notes”). The net proceeds from the issuance of the Convertible Notes, after deducting the initial purchasers' transaction fees and offering expense payable by us, were approximately $290.2 million. The Convertible Notes bear interest at the annual rate of 1.5%, payable on April 1 and October 1 of each year, beginning on April 1, 2020, and will mature on April 1, 2025, unless earlier converted or repurchased by us. The Convertible Notes will be convertible into cash, shares of our common stock or a combination thereof, at our election, at an initial conversion rate of 15.6906 shares of common stock per $1 thousand principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $63.73 per share, as adjusted pursuant to the terms of the indenture governing the Convertible Notes. The Convertible Notes may be converted at any time on or after October 1, 2024, until the close of business on the second scheduled trading day immediately preceding the maturity date. Prior to the close of business on the business day immediately preceding October 1, 2024, the Convertible Notes will be convertible only under the following circumstances: 1. during any calendar quarter commencing after December 31, 2019 if the closing sale price of the common stock is more than 130% of the applicable conversion price on each applicable trading day for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; 2. during the five consecutive business day period after any five consecutive trading day period (the "measurement period") in which the trading price per $1 thousand principal amount of Convertible Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the common stock and the conversion rate for the Convertible Notes on each such trading day; or 3. upon the occurrence of certain specified corporate events set forth in the indenture for the Convertible Notes. We may not redeem the Convertible Notes at our option prior to the maturity date, and no sinking fund is provided for the Convertible Notes. The conversion rate of the Convertible Notes may be adjusted in certain circumstances, including in connection with a conversion of the Convertible Notes made following certain fundamental changes and under other circumstances set forth in the indenture. It is our current intent to settle all conversions of the Convertible Notes in cash. Our ability to cash settle may be limited depending on the stock price at the time of conversion. On October 29, 2019 and October 30, 2019, in connection with the offering of the Convertible Notes, we entered into privately negotiated convertible note hedge transactions (collectively, the “Hedge Transactions”) that cover, subject to customary anti-dilution adjustments, the number of shares of our common stock that initially underlie the Convertible Notes. On October 29, 2019 and October 30, 2019, we also entered into privately negotiated warrant transactions (collectively, the “Warrant Transactions” and, together with the Hedge Transactions, the “Call Spread Transactions”), whereby we sold warrants at a higher strike price relating to the same number of shares of our common stock that initially underlie the Convertible Notes, subject to customary anti-dilution adjustments. The Hedge Transactions and the Warrant Transactions are separate transactions, in each case, and are not part of the terms of the Convertible Notes and will not affect any holder’s rights under the Convertible Notes. Holders of the Convertible Notes will not have any rights with respect to the Call Spread Transactions. Refer to Note 9 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 for additional information regarding the Convertible Notes and the Call Spread Transactions. Accounting Treatment of the Convertible Notes and Related Hedge Transactions and Warrant Transactions In the first quarter of Fiscal 2023, we adopted ASU 2020-06 using the modified retrospective approach. The new guidance simplifies the accounting for convertible instruments by removing certain separation models. As a result, more convertible debt instruments will be accounted for as a single liability measured at amortized cost. Prior to our adoption of ASU 2020-06, we bifurcated the proceeds from the offering of the Convertible Notes between liability and equity components. On the date of issuance, the liability and equity components were calculated to be approximately $215.0 million and $85.0 million, respectively. The initial $215.0 million liability component was determined based on the fair value of similar debt instruments excluding the conversion feature assuming a hypothetical interest rate of 8%. The initial $85.0 million ($64.1 million net of tax) equity component represented the difference between the fair value of the initial $215.0 million in debt and the $300.0 million of gross proceeds. The initial debt discount of $85.0 million was being amortized over the life of the Convertible Notes as non-cash interest expense using the effective interest method. We recognized $3.7 million and $7.3 million of non-cash interest expense during the three and six months ended February 26, 2022, respectively. In addition, offering-related costs of $9.8 million were allocated to the liability and equity components in proportion to the allocation of proceeds. In connection with our adoption of ASU 2020-06, we derecognized the remaining unamortized interest discount on the Convertible Notes and therefore recorded no non-cash interest expense related to the amortization of the debt discount during the six months ended February 25, 2023. As a result, the Convertible Notes are now accounted for as a single liability measured at amortized cost. Interest expense, representing the amortization of the debt issuance costs as well as the contractual interest expense is amortized using an effective interest rate of 2.1% over the term of the Convertible Notes. We recorded $1.6 million and $3.1 million of interest expense during the three and six months ended February 25, 2023, respectively. Refer to Note 15 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for more information related to the earnings per share impact associated with the Convertible Notes and our adoption of ASU-2020-06. The net cost incurred in connection with the Call Spread Transactions was $11.2 million. These transactions are classified as equity and are not remeasured each reporting period. Fair Value and Future Maturities As of February 25, 2023 and August 27, 2022, the fair value of long-term debt, gross, was $636.3 million and $634.2 million, respectively. The fair value of the Convertible Notes was $351.8 million as of February 25, 2023. Aggregate contractual maturities of debt in future fiscal years are as follows: (in millions) Amount Remainder of Fiscal 2023 $ — Fiscal 2024 — Fiscal 2025 300.0 Fiscal 2026 — Fiscal 2027 — Fiscal 2028 300.0 Total Senior Secured Notes and Convertible Notes $ 600.0 |
Employee and Retiree Benefits
Employee and Retiree Benefits | 6 Months Ended |
Feb. 25, 2023 | |
Retirement Benefits [Abstract] | |
Employee and Retiree Benefits | Employee and Retiree Benefits Deferred compensation liabilities are as follows: (in millions) February 25, August 27, Non-qualified deferred compensation $ 7.2 $ 7.9 Supplemental executive retirement plan 1.4 1.4 Executive deferred compensation plan 1.8 1.4 Total deferred compensation benefits 10.4 10.7 Less: current portion (1) 2.2 2.6 Deferred compensation benefits, net of current portion $ 8.2 $ 8.1 (1) Included in accrued compensation on the Consolidated Balance Sheets. |
Contingent Liabilities and Comm
Contingent Liabilities and Commitments | 6 Months Ended |
Feb. 25, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent Liabilities and Commitments | Contingent Liabilities and Commitments Repurchase Commitments Generally, manufacturers in the same industries as us enter into repurchase agreements with lending institutions which have provided wholesale floorplan financing to dealers. Most dealers are financed on a "floorplan" basis under which a bank or finance company lends the dealer all, or substantially all, of the purchase price, collateralized by a security interest in the units purchased. Our repurchase agreements generally provide that, in the event of default by the dealer on the agreement to pay the lending institution, we will repurchase the financed merchandise. The terms of these agreements, which generally can last up to 24 months, provide that our liability will be the lesser of remaining principal owed by the dealer to the lending institution, or dealer invoice less periodic reductions based on the time since the date of the original invoice. Our liability cannot exceed 100% of the dealer invoice. In certain instances, we also repurchase inventory from dealers due to state law or regulatory requirements that govern voluntary or involuntary relationship terminations. Although laws vary from state to state, some states have laws in place that require manufacturers of recreational vehicles or boats to repurchase current inventory if a dealership exits the business. The total contingent liability on all of our repurchase agreements was approximately $2,174.3 million and $1,783.7 million at February 25, 2023 and August 27, 2022, respectively. Our loss reserve for repurchase commitments contains uncertainties because the calculation requires management to make assumptions and apply judgment regarding a number of factors. Our risk of loss related to these repurchase commitments is significantly reduced by the potential resale value of any products that are subject to repurchase and is spread over numerous dealers and lenders. The aggregate contingent liability related to our repurchase agreements represents all financed dealer inventory at the period-end reporting date subject to a repurchase agreement, net of the greater of periodic reductions per the agreement or dealer principal payments. Based on these repurchase agreements and our historical loss experience, an associated loss reserve is established which is included in other current liabilities on the Consolidated Balance Sheets. Our repurchase accrual was $1.4 million and $1.4 million at February 25, 2023 and August 27, 2022, respectively. Repurchase risk is affected by the credit worthiness of our dealer network. We do not believe there is a reasonable likelihood that there will be a material change in the estimates or assumptions used to establish the loss reserve for repurchase commitments. There was no material activity related to repurchase agreements during the six months ended February 25, 2023 and February 26, 2022. Litigation |
Revenue
Revenue | 6 Months Ended |
Feb. 25, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue All operating revenue is generated from contracts with customers. Our primary revenue source is generated through the sale of manufactured towable units, motorhome units and marine units to our independent dealer network (our customers). The following table disaggregates revenue by reportable segment and product category: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Net Revenues Towable Fifth Wheel $ 175.3 $ 281.1 $ 363.0 $ 606.9 Travel Trailer 157.2 356.8 305.5 672.2 Other (1) 10.0 8.7 21.3 18.5 Total Towable 342.5 646.6 689.8 1,297.6 Motorhome Class A 183.1 165.0 414.2 360.3 Class B 106.6 167.7 253.5 312.7 Class C and Other (1) 114.1 84.9 200.3 166.0 Total Motorhome 403.8 417.6 868.0 839.0 Marine 112.9 97.3 244.3 176.6 Corporate / All Other (2) 7.5 3.2 16.8 7.3 Consolidated Net Revenues $ 866.7 $ 1,164.7 $ 1,818.9 $ 2,320.5 (1) Relates to parts, accessories, services, and other miscellaneous revenue. (2) Relates to specialty vehicle units, parts, accessories, and services. We do not have material contract assets or liabilities. Allowances for uncollectible receivables are established based on historical collection trends, write-off history, consideration of current conditions and expectations for future economic conditions. Concentration of Risk No single dealer organization accounted for more than 10% of net revenue for the six months ended February 25, 2023 or February 26, 2022. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Feb. 25, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation On December 11, 2018, our shareholders approved the Winnebago Industries, Inc. 2019 Omnibus Incentive Plan ("2019 Plan") as detailed in our Proxy Statement for the 2018 Annual Meeting of Shareholders. The 2019 Plan allows us to grant or issue non-qualified stock options, incentive stock options, restricted share units, and other equity compensation to key employees and to non-employee directors. The 2019 Plan replaces the 2014 Omnibus Equity, Performance Award, and Incentive Compensation Plan (as amended, the "2014 Plan"). The number of shares of our common stock that may be awarded and issued under the 2019 Plan is 4.1 million shares, plus the shares subject to any awards outstanding under the 2014 Plan and our predecessor plan, the 2004 Incentive Compensation Plan (the “2004 Plan”), on December 11, 2018 that subsequently expire, are forfeited or canceled, or are settled for cash. Until such time, awards under the 2014 Plan and the 2004 Plan, respectively, that were outstanding on December 11, 2018 will continue to be subject to the terms of the 2014 Plan or 2004 Plan, as applicable. Shares remaining available for future awards under the 2014 Plan were not carried over into the 2019 Plan. Stock-based compensation expense was $3.5 million and $4.2 million for the three months ended February 25, 2023 and February 26, 2022, respectively; and $6.5 million and $6.9 million for the six months ended February 25, 2023 and February 26, 2022, respectively. Compensation expense is recognized over the requisite service or performance period of the award, unless accelerated by certain retirement eligibility provisions. |
Income Taxes
Income Taxes | 6 Months Ended |
Feb. 25, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Our effective tax rate was 24.3% and 24.0% for the three months ended February 25, 2023 and February 26, 2022, respectively, and 24.4% and 23.6% for the six months ended February 25, 2023 and February 26, 2022, respectively. The increase in tax rate for the three months ended February 25, 2023 compared to the three months ended February 26, 2022 was driven primarily by the impact of a favorable reserve release in the prior year. The increase in tax rate for the six months ended February 25, 2023 compared to the six months ended February 26, 2022 was driven primarily by the impact of both a net favorable impact related to stock compensation and a favorable reserve release in the prior year. On August 16, 2022, the Inflation Reduction Act (“IRA”) was signed into law in the United States. Among other provisions, the IRA includes a 15% corporate minimum tax rate applied to certain large corporations and a 1% excise tax on corporate stock repurchases made after December 31, 2022. We do not expect the IRA to have a material impact on our consolidated financial statements. We file a U.S. Federal tax return, as well as returns in various international and state jurisdictions. As of February 25, 2023, our Federal returns from Fiscal 2019 to present are subject to review by the Internal Revenue Service. With limited exceptions, state returns from Fiscal 2018 to present continue to be subject to review by state taxing jurisdictions. We are currently under review by certain U.S. state tax authorities for Fiscal 2019 through Fiscal 2021. We believe we have adequately reserved for our exposure to potential additional payments for uncertain tax positions in our liability for unrecognized tax benefits. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Feb. 25, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share In the first quarter of Fiscal 2023, we adopted ASU 2020-06. Prior to adoption, we utilized the treasury stock method for calculating the dilutive impact of our Convertible Notes. Upon adoption, we prospectively utilized the if-converted method to calculate the dilutive impact of our Convertible Notes. Under the if-converted method, the Convertible Notes are assumed to be converted into common stock at the beginning of the reporting period, and the resulting shares are included in the denominator of the calculation. In addition, interest charges, net of any income tax effects are added back to the numerator of the calculation. Basic and diluted earnings per share are calculated as follows: Three Months Ended Six Months Ended (in millions, except per share data) February 25, February 26, February 25, February 26, Earnings per share - basic Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Weighted average common shares outstanding 30.5 33.1 30.5 33.2 Basic earnings per common share (1) $ 1.73 $ 2.75 $ 3.71 $ 5.75 Earnings per share - diluted Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Interest expense on convertible notes, net of tax 1.2 — 2.4 — Diluted net income $ 54.0 $ 91.2 $ 115.4 $ 190.8 Weighted average common shares outstanding 30.5 33.1 30.5 33.2 Dilutive impact of stock compensation awards 0.3 0.4 0.3 0.5 Dilutive impact of convertible notes 4.7 0.4 4.7 0.5 Weighted average common shares outstanding, assuming dilution 35.5 33.9 35.5 34.2 Anti-dilutive securities excluded from weighted average common shares outstanding, assuming dilution 0.2 — 0.1 0.1 Diluted earnings per common share (1) $ 1.52 $ 2.69 $ 3.25 $ 5.58 (1) Earnings per share amounts are calculated based on unrounded numbers and therefore may not recalculate using the rounded numbers provided. For both periods presented, the dilutive effect of stock compensation awards was determined using the treasury stock method. Under the treasury stock method, shares associated with certain anti-dilutive securities have been excluded from the diluted weighted average shares outstanding calculation because the exercise of those options would lead to a net reduction in common shares outstanding or anti-dilution. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 6 Months Ended |
Feb. 25, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The consolidated financial statements include the accounts of Winnebago Industries, Inc. and its wholly owned subsidiaries. Significant intercompany account balances and transactions have been eliminated. The use of the terms "Winnebago Industries," "Winnebago," "we," "our," and "us" in this Quarterly Report on Form 10-Q, unless the context otherwise requires, refers to Winnebago Industries, Inc. and its wholly owned subsidiaries. The interim unaudited consolidated financial statements included herein are prepared pursuant to the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”). The information furnished in these consolidated financial statements includes normal recurring adjustments, unless noted otherwise in the Notes to Consolidated Financial Statements, and reflects all adjustments that are, in management’s opinion, necessary for a fair presentation of such financial statements. The consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). GAAP requires us to make estimates and assumptions that affect amounts reported. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations. The consolidated financial statements included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 filed with the SEC. Interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year ending August 26, 2023. |
Comprehensive Income | Comprehensive income refers to the change in stockholders’ equity from transactions and other events and circumstances from non-owner sources. |
Subsequent Events | In preparing the accompanying unaudited consolidated financial statements, we have evaluated subsequent events for potential recognition and disclosure through the date of this filing noting no material subsequent events. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting PronouncementsIn August 2020, the Financial Accounting Standards Board ("FASB") issued ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40) which reduces the number of models used to account for convertible instruments, amends diluted earnings per share ("EPS") calculations for convertible instruments, and amends the requirements for a contract (or embedded derivative) that is potentially settled in an entity's own shares to be classified in equity. Certain disclosure requirements were also added to increase transparency and decision-usefulness regarding a convertible instrument's terms and features. Additionally, the if-converted method must be used for including convertible instruments in diluted EPS as opposed to the treasury stock method. |
Fair Value Measurements | Assets that Fund Deferred Compensation Our assets that fund deferred compensation are marketable equity securities measured at fair value using quoted market prices and primarily consist of equity-based mutual funds. These securities, used to fund the Executive Share Option Plan and the Executive Deferred Compensation Plan, are classified as Level 1 as they are traded in an active market for which closing stock prices are readily available. Refer to Note 11 in the Notes to Consolidated Financial Statements included in Item 8 of Part II of our Annual Report on Form 10-K for the fiscal year ended August 27, 2022 for additional information regarding these plans. The proportion of the assets that will fund options which expire within a year are included in prepaid expenses and other current assets on the Consolidated Balance Sheets. The remaining assets are classified as non-current and are included in other assets on the Consolidated Balance Sheets. Contingent Consideration Contingent consideration represents the earnout liability related to the Barletta acquisition and is valued using a probability-weighted scenario analysis of projected gross profit results and discounted at a risk-free rate. The contingent consideration is classified as Level 3. Actual gross profit results may differ significantly from those used in the estimate above, which may affect future payments. Changes in future payments will be reflected in future operating results as they occur. The following table provides a reconciliation of the beginning and ending balances of the contingent consideration: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Beginning fair value - contingent consideration $ 40.2 $ 30.6 $ 39.8 $ — Additions — — — 24.2 Fair value adjustments 1.6 6.5 2.0 12.9 Ending fair value - contingent consideration $ 41.8 $ 37.1 $ 41.8 $ 37.1 The fair value of the earnout liability that will be settled within a year is included in other current liabilities on the Consolidated Balance Sheets. The remaining earnout liability is included in other long-term liabilities on the Consolidated Balance Sheets. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Certain financial instruments are measured at fair value on a nonrecurring basis. These assets primarily include goodwill, intangible assets, property, plant and equipment, and right-of-use lease assets. These assets were originally recognized at amounts equal to the fair value determined at date of acquisition or purchase. If certain triggering events occur, or if an annual impairment test is required, we will evaluate the non-financial asset for impairment. If an impairment has occurred, the asset will be written down to its current estimated fair value. No impairments were recorded for non-financial assets in the six months ended February 25, 2023 or February 26, 2022. Assets and Liabilities Not Measured at Fair Value Certain financial instruments are not measured at fair value but are recorded at carrying amounts approximating fair value based on their short-term nature. These financial instruments include cash and cash equivalents, receivables, accounts payable, other payables, and long-term debt. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. The fair value of our long-term debt was determined using current quoted prices in active markets for our publicly traded debt obligations, which is classified as Level 1 in the fair value hierarchy. See Note 9 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q for the fair value of our long-term debt. |
Repurchase Commitments | Generally, manufacturers in the same industries as us enter into repurchase agreements with lending institutions which have provided wholesale floorplan financing to dealers. Most dealers are financed on a "floorplan" basis under which a bank or finance company lends the dealer all, or substantially all, of the purchase price, collateralized by a security interest in the units purchased. Our repurchase agreements generally provide that, in the event of default by the dealer on the agreement to pay the lending institution, we will repurchase the financed merchandise. The terms of these agreements, which generally can last up to 24 months, provide that our liability will be the lesser of remaining principal owed by the dealer to the lending institution, or dealer invoice less periodic reductions based on the time since the date of the original invoice. Our liability cannot exceed 100% of the dealer invoice. In certain instances, we also repurchase inventory from dealers due to state law or regulatory requirements that govern voluntary or involuntary relationship terminations. Although laws vary from state to state, some states have laws in place that require manufacturers of recreational vehicles or boats to repurchase current inventory if a dealership exits the business. The total contingent liability on all of our repurchase agreements was approximately $2,174.3 million and $1,783.7 million at February 25, 2023 and August 27, 2022, respectively. Our loss reserve for repurchase commitments contains uncertainties because the calculation requires management to make assumptions and apply judgment regarding a number of factors. Our risk of loss related to these repurchase commitments is significantly reduced by the potential resale value of any products that are subject to repurchase and is spread over numerous dealers and lenders. The aggregate contingent liability related to our repurchase agreements represents all financed dealer inventory at the period-end reporting date subject to a repurchase agreement, net of the greater of periodic reductions per the agreement or dealer principal payments. Based on these repurchase agreements and our historical loss experience, an associated loss reserve is established which is included in other current liabilities on the Consolidated Balance Sheets. Our repurchase accrual was $1.4 million and $1.4 million at February 25, 2023 and August 27, 2022, respectively. Repurchase risk is affected by the credit worthiness of our dealer network. We do not believe there is a reasonable likelihood that there will be a material change in the estimates or assumptions used to establish the loss reserve for repurchase commitments. |
Revenue | We do not have material contract assets or liabilities. Allowances for uncollectible receivables are established based on historical collection trends, write-off history, consideration of current conditions and expectations for future economic conditions. |
Business Segments (Tables)
Business Segments (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Financial information by reportable segment is as follows: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Net Revenues Towable $ 342.5 $ 646.6 $ 689.8 $ 1,297.6 Motorhome 403.8 417.6 868.0 839.0 Marine 112.9 97.3 244.3 176.6 Corporate / All Other 7.5 3.2 16.8 7.3 Consolidated $ 866.7 $ 1,164.7 $ 1,818.9 $ 2,320.5 Adjusted EBITDA Towable $ 39.3 $ 100.6 $ 75.6 $ 212.7 Motorhome 42.5 46.1 92.8 96.2 Marine 14.4 13.0 32.9 23.5 Corporate / All Other (7.8) (9.0) (15.9) (14.4) Consolidated $ 88.4 $ 150.7 $ 185.4 $ 318.0 Capital Expenditures Towable $ 6.2 $ 10.2 $ 20.5 $ 21.3 Motorhome 9.0 7.9 14.8 15.6 Marine 5.3 1.9 12.6 2.5 Corporate / All Other 1.1 0.2 1.5 4.0 Consolidated $ 21.6 $ 20.2 $ 49.4 $ 43.4 (in millions) February 25, August 27, Assets Towable $ 871.4 $ 874.9 Motorhome 856.9 823.4 Marine 443.6 416.1 Corporate / All Other 273.5 302.3 Consolidated $ 2,445.4 $ 2,416.7 Reconciliation of net income to consolidated Adjusted EBITDA is as follows: Three Months Ended Six Months Ended (in millions) February 25, 2023 February 26, 2022 February 25, 2023 February 26, 2022 Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Interest expense, net 5.3 10.3 11.2 20.6 Provision for income taxes 16.9 28.8 36.4 58.9 Depreciation 6.7 5.5 13.3 10.8 Amortization 3.8 8.0 7.6 16.2 EBITDA 85.5 143.8 181.5 297.3 Acquisition-related costs 1.1 0.4 1.7 3.8 Litigation reserves — — — 4.0 Contingent consideration fair value adjustment 1.6 6.5 2.0 12.9 Non-operating loss 0.2 — 0.2 — Adjusted EBITDA $ 88.4 $ 150.7 $ 185.4 $ 318.0 |
Investments and Fair Value Me_2
Investments and Fair Value Measurements (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis are as follows: Fair Value at Fair Value Hierarchy (in millions) February 25, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.7 $ 1.7 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds — — — — Total assets at fair value $ 1.8 $ 1.8 $ — $ — Contingent consideration Earnout liability $ 41.8 $ — $ — $ 41.8 Total liabilities at fair value $ 41.8 $ — $ — $ 41.8 Fair Value at Fair Value Hierarchy (in millions) August 27, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.2 $ 1.2 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds 0.1 0.1 — — Total assets at fair value $ 1.4 $ 1.4 $ — $ — Contingent consideration Earnout liability $ 39.8 $ — $ — $ 39.8 Total liabilities at fair value $ 39.8 $ — $ — $ 39.8 |
Fair Value, Liabilities Measured on Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis are as follows: Fair Value at Fair Value Hierarchy (in millions) February 25, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.7 $ 1.7 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds — — — — Total assets at fair value $ 1.8 $ 1.8 $ — $ — Contingent consideration Earnout liability $ 41.8 $ — $ — $ 41.8 Total liabilities at fair value $ 41.8 $ — $ — $ 41.8 Fair Value at Fair Value Hierarchy (in millions) August 27, Level 1 Level 2 Level 3 Assets that fund deferred compensation Domestic equity funds $ 1.2 $ 1.2 $ — $ — International equity funds 0.1 0.1 — — Fixed income funds 0.1 0.1 — — Total assets at fair value $ 1.4 $ 1.4 $ — $ — Contingent consideration Earnout liability $ 39.8 $ — $ — $ 39.8 Total liabilities at fair value $ 39.8 $ — $ — $ 39.8 |
Fair Value Disclosure Of Contingent Consideration | The following table provides a reconciliation of the beginning and ending balances of the contingent consideration: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Beginning fair value - contingent consideration $ 40.2 $ 30.6 $ 39.8 $ — Additions — — — 24.2 Fair value adjustments 1.6 6.5 2.0 12.9 Ending fair value - contingent consideration $ 41.8 $ 37.1 $ 41.8 $ 37.1 |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consist of the following: (in millions) February 25, August 27, Finished goods $ 89.8 $ 59.3 Work-in-process 183.4 198.9 Raw materials 316.3 315.0 Total 589.5 573.2 Less: Excess of FIFO over LIFO cost 49.1 47.4 Inventories, net $ 540.4 $ 525.8 Inventory valuation methods consist of the following: (in millions) February 25, August 27, LIFO basis $ 260.4 $ 212.3 First-in, first-out basis 329.1 360.9 Total $ 589.5 $ 573.2 |
Property, Plant, and Equipment
Property, Plant, and Equipment (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment | Property, plant, and equipment is stated at cost, net of accumulated depreciation, and consists of the following: (in millions) February 25, August 27, Land $ 14.6 $ 14.6 Buildings and building improvements 201.6 171.0 Machinery and equipment 150.8 142.6 Software 44.1 43.8 Transportation 6.7 6.5 Construction in progress 83.9 76.8 Property, plant, and equipment, gross 501.7 455.3 Less: Accumulated depreciation 191.3 179.1 Property, plant, and equipment, net $ 310.4 $ 276.2 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill by reportable segment, with no accumulated impairment losses, for the six months ended February 25, 2023 and February 26, 2022 are as follows: (in millions) Towable Motorhome Marine Total Balances at August 28, 2021 $ 244.7 $ 73.1 $ 30.3 $ 348.1 Acquisition of Barletta (1) — — 136.1 136.1 Balances at February 26, 2022 $ 244.7 $ 73.1 $ 166.4 $ 484.2 Balances at August 27, 2022 and February 25, 2023 (2) $ 244.7 $ 73.1 $ 166.4 $ 484.2 (1) The change in marine activity is related to the acquisition of Barletta that occurred on August 31, 2021. See Note 2 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q. (2) There was no activity in the six months ended February 25, 2023. |
Schedule of Other Intangible Assets | Other intangible assets, net of accumulated amortization, consist of the following: February 25, 2023 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Value Trade names $ 352.3 $ 352.3 Dealer networks 180.0 $ 67.9 112.1 Backlog 42.3 42.3 — Non-compete agreements 6.6 6.2 0.4 Other intangible assets $ 581.2 $ 116.4 $ 464.8 August 27, 2022 (in millions) Gross Carrying Amount Accumulated Amortization Net Carrying Value Trade names $ 352.3 $ 352.3 Dealer networks 180.0 $ 60.5 119.5 Backlog 42.3 42.3 — Non-compete agreements 6.6 6.0 0.6 Other intangible assets $ 581.2 $ 108.8 $ 472.4 |
Schedule of Remaining Estimated Aggregate Annual Amortization Expense | Estimated future amortization expense related to finite-lived intangible assets is as follows: (in millions) Amortization Remainder of Fiscal 2023 $ 7.6 Fiscal 2024 15.1 Fiscal 2025 14.9 Fiscal 2026 14.9 Fiscal 2027 14.9 Fiscal 2028 14.9 Thereafter 30.2 Total amortization expense remaining $ 112.5 |
Product Warranties (Tables)
Product Warranties (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Product Warranty Liability | Changes in the product warranty liability are as follows: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Balance at beginning of period $ 122.2 $ 102.4 $ 127.9 $ 91.2 Business acquisition (1) — — — 4.7 Provision 16.0 31.2 34.1 57.2 Claims paid (24.5) (19.8) (48.3) (39.3) Balance at end of period $ 113.7 $ 113.8 $ 113.7 $ 113.8 (1) Relates to the acquisition of Barletta on August 31, 2021. See Note 2 in the Notes to Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt consists of the following: (in millions) February 25, August 27, ABL Credit Facility $ — $ — Senior Secured Notes 300.0 300.0 Convertible Notes 300.0 300.0 Long-term debt, gross 600.0 600.0 Convertible Notes unamortized interest discount (1) — (45.3) Debt issuance costs, net (9.0) (8.8) Long-term debt, net $ 591.0 $ 545.9 (1) In connection with the adoption of ASU 2020-06, the unamortized interest discount was derecognized in the first quarter of Fiscal 2023. Refer to Note 1 in the Notes to Consolidated Financial Statements in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional information. |
Schedule of Maturities of Long-term Debt | Aggregate contractual maturities of debt in future fiscal years are as follows: (in millions) Amount Remainder of Fiscal 2023 $ — Fiscal 2024 — Fiscal 2025 300.0 Fiscal 2026 — Fiscal 2027 — Fiscal 2028 300.0 Total Senior Secured Notes and Convertible Notes $ 600.0 |
Employee and Retiree Benefits (
Employee and Retiree Benefits (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of Deferred Compensation Liabilities | Deferred compensation liabilities are as follows: (in millions) February 25, August 27, Non-qualified deferred compensation $ 7.2 $ 7.9 Supplemental executive retirement plan 1.4 1.4 Executive deferred compensation plan 1.8 1.4 Total deferred compensation benefits 10.4 10.7 Less: current portion (1) 2.2 2.6 Deferred compensation benefits, net of current portion $ 8.2 $ 8.1 (1) Included in accrued compensation on the Consolidated Balance Sheets. |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table disaggregates revenue by reportable segment and product category: Three Months Ended Six Months Ended (in millions) February 25, February 26, February 25, February 26, Net Revenues Towable Fifth Wheel $ 175.3 $ 281.1 $ 363.0 $ 606.9 Travel Trailer 157.2 356.8 305.5 672.2 Other (1) 10.0 8.7 21.3 18.5 Total Towable 342.5 646.6 689.8 1,297.6 Motorhome Class A 183.1 165.0 414.2 360.3 Class B 106.6 167.7 253.5 312.7 Class C and Other (1) 114.1 84.9 200.3 166.0 Total Motorhome 403.8 417.6 868.0 839.0 Marine 112.9 97.3 244.3 176.6 Corporate / All Other (2) 7.5 3.2 16.8 7.3 Consolidated Net Revenues $ 866.7 $ 1,164.7 $ 1,818.9 $ 2,320.5 (1) Relates to parts, accessories, services, and other miscellaneous revenue. (2) Relates to specialty vehicle units, parts, accessories, and services. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Feb. 25, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Income Per Share | Basic and diluted earnings per share are calculated as follows: Three Months Ended Six Months Ended (in millions, except per share data) February 25, February 26, February 25, February 26, Earnings per share - basic Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Weighted average common shares outstanding 30.5 33.1 30.5 33.2 Basic earnings per common share (1) $ 1.73 $ 2.75 $ 3.71 $ 5.75 Earnings per share - diluted Net income $ 52.8 $ 91.2 $ 113.0 $ 190.8 Interest expense on convertible notes, net of tax 1.2 — 2.4 — Diluted net income $ 54.0 $ 91.2 $ 115.4 $ 190.8 Weighted average common shares outstanding 30.5 33.1 30.5 33.2 Dilutive impact of stock compensation awards 0.3 0.4 0.3 0.5 Dilutive impact of convertible notes 4.7 0.4 4.7 0.5 Weighted average common shares outstanding, assuming dilution 35.5 33.9 35.5 34.2 Anti-dilutive securities excluded from weighted average common shares outstanding, assuming dilution 0.2 — 0.1 0.1 Diluted earnings per common share (1) $ 1.52 $ 2.69 $ 3.25 $ 5.58 (1) Earnings per share amounts are calculated based on unrounded numbers and therefore may not recalculate using the rounded numbers provided. |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | Nov. 26, 2022 | Aug. 27, 2022 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Decrease in additional paid-in capital | $ (193.9) | $ (193.9) | $ (256.3) | |||
Long-term debt, net | 591 | 591 | 545.9 | |||
Decrease in deferred income tax liability | 0 | 0 | (6.1) | |||
Increase in retained earnings | $ 1,671 | 1,671 | $ 1,537.5 | |||
Reduction of non-cash interest expense | $ (3.7) | $ 0 | $ (7.3) | |||
Dilutive impact of convertible notes (in shares) | 4.7 | 0.4 | 4.7 | 0.5 | ||
Accounting Standards Update 2020-06 | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Decrease in additional paid-in capital | $ 62 | |||||
Long-term debt, net | 43.8 | |||||
Decrease in deferred income tax liability | 10.8 | |||||
Increase in retained earnings | $ 29 | |||||
Reduction of non-cash interest expense | $ 3.7 | $ 7.3 | ||||
Dilutive impact of convertible notes (in shares) | 4.7 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||||
Aug. 31, 2021 | Feb. 25, 2023 | Feb. 26, 2022 | Nov. 27, 2021 | Feb. 25, 2023 | Feb. 26, 2022 | Aug. 27, 2022 | Aug. 28, 2021 | |
Business Acquisition [Line Items] | ||||||||
Goodwill | $ 484.2 | $ 484.2 | $ 484.2 | $ 484.2 | $ 484.2 | $ 348.1 | ||
Acquisition-related costs expensed | 1.1 | $ 0.4 | 1.7 | $ 3.8 | ||||
Barletta | ||||||||
Business Acquisition [Line Items] | ||||||||
Percent of voting interest acquired | 100% | |||||||
Purchase price | $ 286.3 | |||||||
Cash payments | 240.1 | |||||||
Purchase price, common stock issued | $ 25 | |||||||
Discount percentage on purchase price | 12% | |||||||
Lockup restriction period | 1 year | |||||||
Purchase price, common stock issued after discount | $ 22 | |||||||
Earnout liability | 24.2 | 41.8 | 41.8 | 39.8 | ||||
Goodwill | 136.1 | |||||||
Other intangible assets | $ 111.4 | |||||||
Transaction costs | $ 3.1 | |||||||
Acquisition-related costs expensed | $ 2.4 | |||||||
Barletta | Dealer networks | ||||||||
Business Acquisition [Line Items] | ||||||||
Weighted-average useful life | 12 years | |||||||
Barletta | Backlog | ||||||||
Business Acquisition [Line Items] | ||||||||
Weighted-average useful life | 10 months | |||||||
Barletta | Other Current Liabilities | ||||||||
Business Acquisition [Line Items] | ||||||||
Earnout liability | 21.9 | 21.9 | 21.3 | |||||
Barletta | Other Noncurrent Liabilities | ||||||||
Business Acquisition [Line Items] | ||||||||
Earnout liability | $ 19.9 | $ 19.9 | $ 18.5 | |||||
Barletta | Earnout Paid In Stock | ||||||||
Business Acquisition [Line Items] | ||||||||
Earnout amount | $ 50 | |||||||
Barletta | Earnout Paid In Cash | ||||||||
Business Acquisition [Line Items] | ||||||||
Earnout amount | $ 15 |
Business Segments (Details)
Business Segments (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 25, 2023 USD ($) | Feb. 26, 2022 USD ($) | Feb. 25, 2023 USD ($) segment | Feb. 26, 2022 USD ($) | Aug. 27, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of operating segments | segment | 7 | ||||
Number of reportable segments | segment | 3 | ||||
Net Revenues | $ 866.7 | $ 1,164.7 | $ 1,818.9 | $ 2,320.5 | |
Adjusted EBITDA | 88.4 | 150.7 | 185.4 | 318 | |
Capital Expenditures | 21.6 | 20.2 | 49.4 | 43.4 | |
Assets | 2,445.4 | 2,445.4 | $ 2,416.7 | ||
Net income | 52.8 | 91.2 | 113 | 190.8 | |
Interest expense, net | 5.3 | 10.3 | 11.2 | 20.6 | |
Provision for income taxes | 16.9 | 28.8 | 36.4 | 58.9 | |
Depreciation | 6.7 | 5.5 | 13.3 | 10.8 | |
Amortization | 3.8 | 8 | 7.6 | 16.2 | |
EBITDA | 85.5 | 143.8 | 181.5 | 297.3 | |
Acquisition-related costs | 1.1 | 0.4 | 1.7 | 3.8 | |
Litigation reserves | 0 | 0 | 0 | 4 | |
Contingent consideration fair value adjustment | 1.6 | 6.5 | 2 | 12.9 | |
Non-operating loss | 0.2 | 0 | 0.2 | 0 | |
Operating Segments | Towable | |||||
Segment Reporting Information [Line Items] | |||||
Net Revenues | 342.5 | 646.6 | 689.8 | 1,297.6 | |
Adjusted EBITDA | 39.3 | 100.6 | 75.6 | 212.7 | |
Capital Expenditures | 6.2 | 10.2 | 20.5 | 21.3 | |
Assets | 871.4 | 871.4 | 874.9 | ||
Operating Segments | Motorhome | |||||
Segment Reporting Information [Line Items] | |||||
Net Revenues | 403.8 | 417.6 | 868 | 839 | |
Adjusted EBITDA | 42.5 | 46.1 | 92.8 | 96.2 | |
Capital Expenditures | 9 | 7.9 | 14.8 | 15.6 | |
Assets | 856.9 | 856.9 | 823.4 | ||
Operating Segments | Marine | |||||
Segment Reporting Information [Line Items] | |||||
Net Revenues | 112.9 | 97.3 | 244.3 | 176.6 | |
Adjusted EBITDA | 14.4 | 13 | 32.9 | 23.5 | |
Capital Expenditures | 5.3 | 1.9 | 12.6 | 2.5 | |
Assets | 443.6 | 443.6 | 416.1 | ||
Corporate / All Other | |||||
Segment Reporting Information [Line Items] | |||||
Net Revenues | 7.5 | 3.2 | 16.8 | 7.3 | |
Adjusted EBITDA | (7.8) | (9) | (15.9) | (14.4) | |
Capital Expenditures | 1.1 | $ 0.2 | 1.5 | $ 4 | |
Assets | $ 273.5 | $ 273.5 | $ 302.3 |
Investments and Fair Value Me_3
Investments and Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - USD ($) | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Aug. 27, 2022 | |
Fair Value, Measurements, Recurring | |||
Assets that fund deferred compensation | |||
Domestic equity funds | $ 1,700,000 | $ 1,200,000 | |
International equity funds | 100,000 | 100,000 | |
Fixed income funds | 0 | 100,000 | |
Total assets at fair value | 1,800,000 | 1,400,000 | |
Contingent consideration | |||
Earnout liability | 41,800,000 | 39,800,000 | |
Total liabilities at fair value | 41,800,000 | 39,800,000 | |
Fair Value, Measurements, Recurring | Level 1 | |||
Assets that fund deferred compensation | |||
Domestic equity funds | 1,700,000 | 1,200,000 | |
International equity funds | 100,000 | 100,000 | |
Fixed income funds | 0 | 100,000 | |
Total assets at fair value | 1,800,000 | 1,400,000 | |
Contingent consideration | |||
Earnout liability | 0 | 0 | |
Total liabilities at fair value | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 2 | |||
Assets that fund deferred compensation | |||
Domestic equity funds | 0 | 0 | |
International equity funds | 0 | 0 | |
Fixed income funds | 0 | 0 | |
Total assets at fair value | 0 | 0 | |
Contingent consideration | |||
Earnout liability | 0 | 0 | |
Total liabilities at fair value | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 3 | |||
Assets that fund deferred compensation | |||
Domestic equity funds | 0 | 0 | |
International equity funds | 0 | 0 | |
Fixed income funds | 0 | 0 | |
Total assets at fair value | 0 | 0 | |
Contingent consideration | |||
Earnout liability | 41,800,000 | 39,800,000 | |
Total liabilities at fair value | 41,800,000 | $ 39,800,000 | |
Fair Value, Nonrecurring | |||
Contingent consideration | |||
Asset impairment charges | $ 0 | $ 0 |
Investments and Fair Value Me_4
Investments and Fair Value Measurements - Fair Value of Contingent Consideration (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning fair value - contingent consideration | $ 40.2 | $ 30.6 | $ 39.8 | $ 0 |
Additions | 0 | 0 | 0 | 24.2 |
Fair value adjustments | 1.6 | 6.5 | 2 | 12.9 |
Ending fair value - contingent consideration | $ 41.8 | $ 37.1 | $ 41.8 | $ 37.1 |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 89.8 | $ 59.3 |
Work-in-process | 183.4 | 198.9 |
Raw materials | 316.3 | 315 |
Total | 589.5 | 573.2 |
Less: Excess of FIFO over LIFO cost | 49.1 | 47.4 |
Inventories, net | $ 540.4 | $ 525.8 |
Inventories - Inventory Valuati
Inventories - Inventory Valuation Methods (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Inventory Disclosure [Abstract] | ||
LIFO basis | $ 260.4 | $ 212.3 |
First-in, first-out basis | 329.1 | 360.9 |
Total | $ 589.5 | $ 573.2 |
Property, Plant, and Equipmen_2
Property, Plant, and Equipment (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | Aug. 27, 2022 | |
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | $ 501.7 | $ 501.7 | $ 455.3 | ||
Less: Accumulated depreciation | 191.3 | 191.3 | 179.1 | ||
Property, plant, and equipment, net | 310.4 | 310.4 | 276.2 | ||
Depreciation | 6.7 | $ 5.5 | 13.3 | $ 10.8 | |
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | 14.6 | 14.6 | 14.6 | ||
Buildings and building improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | 201.6 | 201.6 | 171 | ||
Machinery and equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | 150.8 | 150.8 | 142.6 | ||
Software | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | 44.1 | 44.1 | 43.8 | ||
Transportation | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | 6.7 | 6.7 | 6.5 | ||
Construction in progress | |||||
Property, Plant and Equipment [Line Items] | |||||
Property, plant, and equipment, gross | $ 83.9 | $ 83.9 | $ 76.8 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) | 6 Months Ended | |
Feb. 25, 2023 | Feb. 26, 2022 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 484,200,000 | $ 348,100,000 |
Acquisition of Barletta | 136,100,000 | |
Ending balance | 484,200,000 | 484,200,000 |
Goodwill activity | 0 | |
Towable | ||
Goodwill [Roll Forward] | ||
Beginning balance | 244,700,000 | 244,700,000 |
Acquisition of Barletta | 0 | |
Ending balance | 244,700,000 | 244,700,000 |
Motorhome | ||
Goodwill [Roll Forward] | ||
Beginning balance | 73,100,000 | 73,100,000 |
Acquisition of Barletta | 0 | |
Ending balance | 73,100,000 | 73,100,000 |
Marine | ||
Goodwill [Roll Forward] | ||
Beginning balance | 166,400,000 | 30,300,000 |
Acquisition of Barletta | 136,100,000 | |
Ending balance | $ 166,400,000 | $ 166,400,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Intangible Assets (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Schedule of Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 581.2 | $ 581.2 |
Accumulated Amortization | 116.4 | 108.8 |
Net Carrying Value | 464.8 | 472.4 |
Dealer networks | ||
Schedule of Intangible Assets [Line Items] | ||
Gross Carrying Amount | 180 | 180 |
Accumulated Amortization | 67.9 | 60.5 |
Net Carrying Value | 112.1 | 119.5 |
Backlog | ||
Schedule of Intangible Assets [Line Items] | ||
Gross Carrying Amount | 42.3 | 42.3 |
Accumulated Amortization | 42.3 | 42.3 |
Net Carrying Value | 0 | 0 |
Non-compete agreements | ||
Schedule of Intangible Assets [Line Items] | ||
Gross Carrying Amount | 6.6 | 6.6 |
Accumulated Amortization | 6.2 | 6 |
Net Carrying Value | 0.4 | 0.6 |
Trade names | ||
Schedule of Intangible Assets [Line Items] | ||
Gross Carrying Amount | 352.3 | 352.3 |
Net Carrying Value | $ 352.3 | $ 352.3 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) | 6 Months Ended |
Feb. 25, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Weighted average remaining amortization period (in years) | 8 years |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization of Intangible Assets (Details) $ in Millions | Feb. 25, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Remainder of Fiscal 2023 | $ 7.6 |
Fiscal 2024 | 15.1 |
Fiscal 2025 | 14.9 |
Fiscal 2026 | 14.9 |
Fiscal 2027 | 14.9 |
Fiscal 2028 | 14.9 |
Thereafter | 30.2 |
Total amortization expense remaining | $ 112.5 |
Product Warranties (Details)
Product Warranties (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ||||
Balance at beginning of period | $ 122.2 | $ 102.4 | $ 127.9 | $ 91.2 |
Business acquisition | 0 | 0 | 0 | 4.7 |
Provision | 16 | 31.2 | 34.1 | 57.2 |
Claims paid | (24.5) | (19.8) | (48.3) | (39.3) |
Balance at end of period | $ 113.7 | $ 113.8 | $ 113.7 | $ 113.8 |
Long-Term Debt - Components of
Long-Term Debt - Components of Long-Term Debt (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 600 | $ 600 |
Convertible Notes unamortized interest discount | 0 | (45.3) |
Debt issuance costs, net | (9) | (8.8) |
Long-term debt, net | 591 | 545.9 |
ABL Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 0 | 0 |
Senior Secured Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | 300 | 300 |
Convertible Notes | ||
Debt Instrument [Line Items] | ||
Long-term debt, gross | $ 300 | $ 300 |
Long-Term Debt - Credit Agreeme
Long-Term Debt - Credit Agreements (Details) - USD ($) | Jul. 15, 2022 | Jul. 08, 2020 | Jul. 14, 2022 |
ABL Credit Facility | |||
Debt Instrument [Line Items] | |||
Debt, face amount | $ 350,000,000 | $ 192,500,000 | |
Debt instrument, basis spread on variable rate | 0.10% | ||
Debt issuance costs | $ 1,200,000 | ||
Debt term | 5 years | ||
ABL Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on variable rate | 1.25% | ||
ABL Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Debt instrument, basis spread on variable rate | 1.75% | ||
ABL Credit Facility | Letter of Credit | |||
Debt Instrument [Line Items] | |||
Debt amount | $ 35,000,000 | ||
ABL Credit Facility | Letter of Credit | Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.25% | ||
Senior Secured Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Debt amount | $ 300,000,000 | ||
Debt issuance costs | $ 7,500,000 | ||
Debt term | 8 years | ||
Interest rate, stated percentage | 6.25% |
Long-Term Debt - Convertible No
Long-Term Debt - Convertible Notes (Details) | 3 Months Ended | 6 Months Ended | ||||
Nov. 01, 2019 USD ($) tradingDay consecutiveTradingDay $ / shares Rate | Feb. 25, 2023 USD ($) | Feb. 26, 2022 USD ($) | Feb. 25, 2023 USD ($) | Feb. 26, 2022 USD ($) | Aug. 27, 2022 USD ($) | |
Debt Instrument [Line Items] | ||||||
Non-cash interest expense | $ 3,700,000 | $ 0 | $ 7,300,000 | |||
Offering-related costs | $ 9,000,000 | 9,000,000 | $ 8,800,000 | |||
Interest expense, net | $ 5,300,000 | $ 10,300,000 | $ 11,200,000 | $ 20,600,000 | ||
Call Spread Transactions | ||||||
Debt Instrument [Line Items] | ||||||
Equity component of issuance | 85,000,000 | |||||
Equity component of issuance, net of tax | 64,100,000 | |||||
Offering-related costs | 9,800,000 | |||||
Convertible Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt amount | $ 300,000,000 | 300,000,000 | ||||
Interest rate, stated percentage | 1.50% | |||||
Proceeds from issuance of notes | $ 290,200,000 | |||||
Conversion rate (in shares) | Rate | 1.56906% | |||||
Conversion price (in dollars per share) | $ / shares | $ 63.73 | |||||
Number of consecutive trading days | tradingDay | 30 | |||||
Consecutive business days | consecutiveTradingDay | 5 | |||||
Consecutive trading days | consecutiveTradingDay | 5 | |||||
Convertible Notes | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of the conversion price | 130% | |||||
Number of trading days | tradingDay | 20 | |||||
Convertible Notes | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of the conversion price | 98% | |||||
Convertible Notes | Call Spread Transactions | ||||||
Debt Instrument [Line Items] | ||||||
Debt amount | $ 215,000,000 | |||||
Interest rate, stated percentage | 8% | |||||
Debt instrument, interest rate, effective percentage | 2.10% | 2.10% | ||||
Interest expense, net | $ 1,600,000 | $ 3,100,000 | ||||
Net cost incurred transaction, amount | $ 11,200,000 |
Long-Term Debt - Long-Term Debt
Long-Term Debt - Long-Term Debt Contractual Maturities (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Debt Instrument [Line Items] | ||
Fair value of long-term debt, gross | $ 636.3 | $ 634.2 |
Remainder of Fiscal 2023 | 0 | |
Fiscal 2024 | 0 | |
Fiscal 2025 | 300 | |
Fiscal 2026 | 0 | |
Fiscal 2027 | 0 | |
Fiscal 2028 | 300 | |
Total Senior Secured Notes and Convertible Notes | 600 | 600 |
Convertible Notes | ||
Debt Instrument [Line Items] | ||
Fair value of long-term debt, gross | 351.8 | |
Total Senior Secured Notes and Convertible Notes | $ 300 | $ 300 |
Employee and Retiree Benefits_2
Employee and Retiree Benefits (Details) - USD ($) $ in Millions | Feb. 25, 2023 | Aug. 27, 2022 |
Retirement Benefits [Abstract] | ||
Non-qualified deferred compensation | $ 7.2 | $ 7.9 |
Supplemental executive retirement plan | 1.4 | 1.4 |
Executive deferred compensation plan | 1.8 | 1.4 |
Total deferred compensation benefits | 10.4 | 10.7 |
Less current portion | 2.2 | 2.6 |
Deferred compensation benefits, net of current portion | $ 8.2 | $ 8.1 |
Contingent Liabilities and Co_2
Contingent Liabilities and Commitments (Details) - USD ($) $ in Millions | 6 Months Ended | |
Feb. 25, 2023 | Aug. 27, 2022 | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Repurchase agreement term | 24 months | |
Percentage of dealer invoice that liability cannot exceed | 100% | |
Accrued loss on repurchases | $ 1.4 | $ 1.4 |
Obligation to Repurchase from Dealers | ||
Purchase Commitment, Excluding Long-term Commitment [Line Items] | ||
Contingent liability on repurchase agreements | $ 2,174.3 | $ 1,783.7 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | $ 866.7 | $ 1,164.7 | $ 1,818.9 | $ 2,320.5 |
Operating Segments | Towable | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 342.5 | 646.6 | 689.8 | 1,297.6 |
Operating Segments | Towable | Fifth Wheel | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 175.3 | 281.1 | 363 | 606.9 |
Operating Segments | Towable | Travel Trailer | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 157.2 | 356.8 | 305.5 | 672.2 |
Operating Segments | Towable | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 10 | 8.7 | 21.3 | 18.5 |
Operating Segments | Motorhome | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 403.8 | 417.6 | 868 | 839 |
Operating Segments | Motorhome | Class A | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 183.1 | 165 | 414.2 | 360.3 |
Operating Segments | Motorhome | Class B | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 106.6 | 167.7 | 253.5 | 312.7 |
Operating Segments | Motorhome | Class C and Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 114.1 | 84.9 | 200.3 | 166 |
Operating Segments | Marine | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | 112.9 | 97.3 | 244.3 | 176.6 |
Corporate / All Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Consolidated Net Revenues | $ 7.5 | $ 3.2 | $ 16.8 | $ 7.3 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | Dec. 11, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock-based compensation | $ 3.5 | $ 4.2 | $ 6.5 | $ 6.9 | |
Incentive Compensation Plan 2019 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of awards issued under the plan (in shares) | 4.1 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 24.30% | 24% | 24.40% | 23.60% |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 25, 2023 | Feb. 26, 2022 | Feb. 25, 2023 | Feb. 26, 2022 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 52.8 | $ 91.2 | $ 113 | $ 190.8 |
Weighted average common shares outstanding (in shares) | 30.5 | 33.1 | 30.5 | 33.2 |
Basic earnings per common share (in dollars per share) | $ 1.73 | $ 2.75 | $ 3.71 | $ 5.75 |
Interest expense on convertible notes, net of tax | $ 1.2 | $ 0 | $ 2.4 | $ 0 |
Diluted net income | $ 54 | $ 91.2 | $ 115.4 | $ 190.8 |
Dilutive impact of stock compensation awards (in shares) | 0.3 | 0.4 | 0.3 | 0.5 |
Dilutive impact of convertible notes (in shares) | 4.7 | 0.4 | 4.7 | 0.5 |
Weighted average common shares outstanding, assuming dilution (in shares) | 35.5 | 33.9 | 35.5 | 34.2 |
Anti-dilutive securities excluded from weighted average common shares outstanding, assuming dilution (in shares) | 0.2 | 0 | 0.1 | 0.1 |
Diluted earnings per common share (in dollars per share) | $ 1.52 | $ 2.69 | $ 3.25 | $ 5.58 |