Winnebago Industries (WGO)

Steven Stuber Director, IR & Financial Planning and Analysis
Michael Happe President and CEO
Bryan Hughes CFO, SVP, Finance, IT & Strategic Planning
Gerrick Johnson BMO Capital Markets
Scott Stember C.L. King & Associates
Craig Kennison Robert W. Baird & Co.
Michael Swartz Truist Securities
Brett Andress KeyBanc Capital Markets
Frederick Wightman Wolfe Research
Ethan Huntley Jefferies
David Whiston Morningstar
Joseph Altobello Raymond James & Associates
Call transcript
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Ladies and gentlemen, thank you for standing by and welcome to the Q2 Fiscal 2022 Winnebago Industries Financial Results Conference Call. [Operator Instructions] I would now like to turn the conference over to your speaker for today, Steve Stuber, Vice President, Investor Relations.

You may begin.

Steven Stuber

Thank you, Towanda [ph], and good morning, everyone and thank you for joining us today to discuss fiscal 2022 second quarter earnings results. I am joined on the call today by Michael Happe, President and Chief Executive Officer; and Bryan Hughes, Senior Vice President and Chief Financial Officer. broadcast of our available the website today. being and at on is later replay a call call live website on investor.wgo.net our This will be the our posted and our website results The were morning. to second this release earnings supplement with along news with second earlier quarter issued quarter

you considered remind The start, regarding its of many and Mike? call which factors, Winnebago to certain forward-looking forward-looking over under made laws. you like CEO, to these you that beyond from be securities statements. the could control, statements we These cautions a uncertain Before risks I and Michael like to during involve statements Happe. company Industries read. are factors operations that turn and of With I'd I cause in encourage number that, in today's call company's would filings, statements actual which may are conference now number a to of to SEC materially are results President differ identified our the our inherently

Michael Happe

call morning, Thanks, the for joining thanks again Good everyone and Steve. today.

by elevated on $X.X for robust results the key premium dynamics. XX% shaped quarter, pass financial second I of always, year-over-year second results on of some your sales set Overall, Winnebago were built more results. start delivered it strong we demand what our in who billion, fiscal sustained make an appreciate our momentum performance quarter As revenues those to Winnebago and by to record results. discuss and call walk and the portfolio products. grew will turn and interest quarter. Industries the our the we our fiscal in overview quarter questions. last second through factors before over remarks our two of I XXXX, the capitalizing Hughes, Then driving taking are with matching results 'XX will and your closing our in to Industries time previous Bryan during We detail to I will

relentless with from periods study products our our to continues and Winnebago new believe actions and in a spend business, company's this market drove expectations and quality, on our second, suggested material propel of to threads market. affinity the will sustained August, pontoon an our Boat that time and is lifestyle, growth to to as we execution a want XXXX A these brands. the feedback year fiscal the RV. Barletta of consumer the demand Pontoon the acquired the of contributed current that Also, impetus our strong continued consumers recent and through unit X a pricing outdoor year; and higher powerful clearly costs. surrounding minute compared focus recently drivers with continue XX% differentiation about result sales our First, consumers certainly offset higher in Industries percentage talking points exceed Winnebago detail. premium growth Through association powerful of for RV component and being and Robust industry RVers more to past Industries share golden gain successful prior for I in undercurrent all the dealers, particular our in the were XXXX begins reasons consumers COVID purchasing our and It boat confirmed of recognize and service we is innovation. This beyond. demand differentiated. interactions receive consumer that

data pursue thesis. the interest become many of that supports products outdoors. their for enable though consumers our that ingrained, and in these confident Compelling are trends continue to We to will that have invest them love

the the in friends households of versus through XXXX. camping increase same XXXX projected Our XX% November at cited a America period campgrounds of in

beyond, via are new the and already recently from upgrade and some first low XX% RV already future. bought parts owner X RV nuggets who released of seeking theory in other in and on RVs, use conducted purchase time an most new XXXX to time the and for new different into to possibly another say noted survey retention RVIA. current XXXX speculating purchasers XXXX millennial or the XX their and Here first RV RV are an the those keep to with Contrary altogether. a RV XXXX, RV and by previously they some XXXX new likely are buyers, likely

of an to stated while As the reason XX% GenXers for millennials as RV. of they it working relates place popularity of growing XX% the a stay a use for new RV that and RVers, amongst purchasing work flexible to

on sustained the Importantly, Winnebago drivers. capitalizing is demand already Industries

Show our year-over-year exceeded attendance Our quarter sales comparison resulted a second COVID-XX-driven RV Miami Show second total tough sales height unit to Boat and grew the Tampa that spike. Strong retail at expectations. nearing quarter XXXX, which fiscal of of was in the despite demand the recent the the

In in in through has Barletta pontoon fifth same X-month fact, XX.X%, boat This market that societal XXXX. spring this a are combined brands. share for is execution remains in selling in market to January, the largest that and breaking RV tailwinds Industries Winnebago on up was And On and trends, our This a continue historically share record proven recent grown at and be Barletta from points a trailing and spring segment, sales the consumers the basis now basis is positioned X-month basis improvement our the show sharp full Marine approaching X.X% both retail barrier. December, by industries. retail Marine meaningful for in months strength, in market our through most by a Industries when our to our a seeing Winnebago season growing company for reflected half XXX second the business. is just opportunity the we strong great of We of confident outdoors X% share RV future portfolio solid The ago XX.X% our there shows trailing acquisition. and X period results brand spells foreshadows remain results. them completed engagement from the

I’m in pleased to see Speaking and targets opportunity We differentiated performance above market product XXXX its our continued has the pontoon on network portfolio pontoon sustain we of focus calendar leveraging strong forward announced market, which dealer unique we to acknowledge perform when and set exceeded the one Barletta of growth. look fastest-growing to that acquisition. their the quality, to for expectations tremendous and boating service Barletta, retail we share segments report is the further innovation,

and strength of our Industries pricing unique to our was driver and to of results demand positioned take margin inflation Winnebago actions. component brands second major cost The revenue and environment performance pricing well preserve material actions The continued positive the to We pricing strategic inflation anticipating ahead Industries year. approach Thanks segments. experiencing began second and across actions of the inflationary for are sophisticated to Winnebago of in our has taking we sourcing, preparing today. environment last our quarter been the offset that

As quality the we underway, market a evaluate as demand offset the power gains. lever the environment spring continue pricing clear resiliency of gets is testament of needed This to driving component still to share a portfolio. will season selling the balancing higher as our costs, expanded and and product to our and while materials

is my another quarter supply efficiencies execution, excellent coupled volatile. especially was team the performance net with the tip line top of chain strong days strong I internally. appreciated which for as operational to cap entire Our these remains Industries Winnebago

sacrificing with continue not our products time dealer efficiently We while to so get quality partners, and to work as as we for materials get the suppliers service. our customers collaboratively can door on out possible and

holding Motorhome segment faced that performance business past constraints, in back the probably chain optimal from Our this significant supply this period. quarter most

area last teammates year. equal Due quarter, at quality. fiscal quarter high operational ensuring a second to to second focus flexible productivity rise though, efforts, organic keeping the and driving XXXX experience year of all higher critical in chain of is pressures the on the the to to fully focus demand, teams. for all consumer industry-leading and going first manner. at continue disciplined and wholesale power our have year backlogs A levels us are opportunities throughout continue With the Winnebago to strategy last product period. strong margin delivered acceptable strong Our for the in in confident And Industries increased demand our levels our Industries and during and am segments versus level supply that I our key constraints pricing continued XX.X% to a we levels comparable a and through dealer inventories meet at than quarter. retail capacity, and continue creating of enabled partners Winnebago will the to our component a great inflationary they dealer to XXXX significantly robust challenge actions, will be execution of improvement consolidated excellence forward, the to gross results margin

to Chief XXXX more Bryan fiscal families in our review second Financial over fortunate we remain to of to Officer, to all delivering great a together, I Winnebago world-class will uniquely Industries financials take more the have to and Working employees as outsized outdoors. call to our well-positioned With team value continue now turn growth strategic the detail. our capturing that, Hughes, stakeholders are We quarter partners. and Bryan?

Bryan Hughes

Thanks, good Mike, and everyone. morning,

for million increase Mike an revenues, fiscal XXXX $X.X for XX% mentioned, $XXX.X As Barletta second the compared results were to including quarter reflecting of billion, period.

Gross growth We profit and increase in Gross for the pricing three well period. of see $XXX chain that and actions by compared some of driven operating quarter second million meaningful last a component million the against a the last delivered was revenue year. year-over-year another associated organic XX% total costs Operating strong despite very by segments for fiscal XXXX as quarter, to $XXX.X period. million, pleased pricing of very $XXX.X and Excluding constraints of in leverage was Barletta, growth by $XXX.X offset XX.X% shipments. comparison XX% of supply a inconsistencies as subcomponents. were steep representing for the evidenced and parts to in quarter, the of compared growth Growth achieved to by operating an deliveries for year, driven profitability all caused and was quarter comparison. second our unit inefficiencies was of margin increase an equal in was XXXX million higher We profit combination the income to robust by was XX%. period material

of year million includes associated of income with adjustment, deal is an in the included earnout second the value included XXXX related income of quarter. the quarter $X.X $XX.X that structure non-operating in to costs income incremental second compared the million the in net acquisition-related fair acquisition. $XX.X prior fiscal amortization to contingent million increase acquisition. income includes to quarter operating related and consideration Fiscal was which Barletta assets Our XXXX Note net XX% intangible of in Barletta $X.X million, $X.X million

are calculation removing we that this deal note the You EPS. consideration adjusted will in of

We the of the as XXXX million to earnout that through are result XXXX end performance note to calendar full of the purchase $XX maximum the tied which agreement dispensation is Barletta July pleased year performance. by in XXXX for period calendar payout the first specified will

the previously, is compared of per per represents in in to earnings $X.XX recall an we earnings year. share of same a diluted adjusted Adjusted that structured manner share share as that diluted last reduced earnings reported increases. increase earnout to diluted the paid year. XX% was $X.XX period last of same in per such earnout which the the As earnings $X.XX Reported diluted period this the share compared $X.XX, further on stated deal that is multiple was per

will I EBITDA the inflation. period. year year's input XX.X% over million, offset XX% leverage the year prior increased million for XX%. EBITDA Unit of for XXXX our of segment by our last of pricing increases segment the the fiscal XX% prior by the was segment same and XXX driven by Adjusted given were primarily up $XXX.X XX% prior growth growth revenues margin driven Segment cost across strong Towable and starting adjusted over over year, quarter, versus to growth the unit Towable basis operating $XXX.X XX% up points Now especially second segment. year, is time with performance, turn partially period. pricing,

our supply to operations a as chain from the in compared our adjusted the Motorhome XX.X%, the the the quarter, while margin were revenues across up the year. the segment. productivity $XX.X for to Segment points delivery other turn year. flow, segment key representing our ongoing from we inefficiencies by from the were increases EBITDA In prior Motorhome Adjusted quarter, decrease a disruptive year components pricing driven year. of million, let's very high strong million, across XX% basis X% prior in segment. of that to chassis was prior was environment and a and experienced XXX the current EBITDA Next, second introduce decrease In $XXX.X inconsistencies operational the into of prior

While remedied the our versus noted they of did continued reduction pricing be we taken expect impacts on products. current It to a Motorhome is term, and margin year. inflation quarter. the in versus longer should be date pricing such impact in the outpace the inefficiencies to the to not the inflationary equation the driver actions segment that last

our Barletta EBITDA higher of Marine inventories remain business. EBITDA higher second million remain segment adjusted revenues turn than Chris-Craft In and $XX.X million period to XXX year, the year, $XX.X was basis retail than the the last reflecting the segment same the strong let's segment. last Marine million. addition and trends points adjusted was for dealer the of margin XX.X%, Finally, and were quarter, Marine low. Barletta $XX.X for businesses The

now balance sheet. the Turning to

to including an million approximately ABL $XXX.X continue a position maintain liquidity of available, healthy $XXX untapped million. We with

at leverage CapEx higher allocation than is currently to investment our is perspective, capital is year's $XX.X On fuel spending which growth. we to Our CapEx. a last million, X.Xx. ratio year-to-date prioritize basis, fiscal businesses year-to-date From a Xx in organic continue

elevated some mitigating a We a the supply of of continue on means to encounter inconsistencies that inventory carry as daily we basis.

eventual is priorities believe investment from a the flow to working capital high that operations in to as the view this prudent continue as longer this and be other for this the liquidate allocation in generating capital near-term, drawdown While cash we and a will term support occurs. action detraction in our available cash

share shares. the million, worth we’ve year-to-date bought of $XX back totaled a $XX.X basis, During quarter, on buybacks million and

trailing the I Combining As XX% will Mike discussed review is to year. a to some running on robust XX-month dividends, with XXXX. through call to closing concludes previously, now XX-month at provide trailing to is back year's That was returned buybacks quarterly higher turn our Xx the approximately have period. of fiscal This our the dividend prior this year quarter of my With that, $XXX financials. a share basis Mike, a last we shareholders than comments. it second back million you.

Michael Happe

Bryan. very Thanks much,

the package technology as more ERV and closer battery of all area Designed powers also sustainable as of advanced preserve ERV drivetrain innovative world enjoy financial and vehicle deep in RV as an We Industries and from a the a commitment and first In it, that responsibility materials. RV about the our advanced all much growth, market forward our want addition the to to delivering shareholders. living ERV all-electric to combines in strong the who communities all-electric zero-emission RV natural want for they the our operation share with Consumer January continued systems generation to for Winnebago our At results our corporate Show RVers home motor incorporates talking the is new Tampa, emission manufacturing. group revealed by the coach. to look we The ERV, zero commercialization. major concept we electric concept to an entirely move that new

enhanced is significantly Our the concept to than version sure and features go-to-market shown. capabilities model bring

to of Advanced our engaged on investors our towable addition communities. benefit lifestyle to actively of we products and as legacy electrification Group relevant is and exciting and new and for In explore frontiers our the innovation outdoor marine the Technology ERV, also continue customers, products RV

for of remainder Industries be outlook XXXX. lifestyle to our reiterate robust. particularly the and I to my for brands the turning outdoor to confidence that will Now Winnebago demand very continue want products

Backlogs elevated the to be which single persist, in RV the an mid compared wholesale percentage-wise Looking remain a we calendar chain supply low down calendar reality XXXX. at XXX,XXX to shipments at be believe could constraints as as units digits we level, year throughout shipped expect record ongoing the for industry macro to XXXX.

as be motorized by recover, later continue recover Marine some with to our total new are to From our XXXX We work will into suppliers sustainable industry will inventories into retail much of we’ve to or to earlier, an high their and perspective that mentioned with the for especially dealer XXXX, single still well that brands our be be closely wholesale followed mitigate previously, will a bring sales the brand. second to with maintain it year we to into calendar level inventories we sales first will retail future. digits quality calendar the RV retail to We perspective, to could as beyond likely percentage-wise. More retail industry sales, anticipate dealer provide units mid-XXXX, that and combined towable and expect and and issues normal happen. and Newmar possible to partners mid back reasonable mentioned replenish the last inventories. this for dealer be believe foreseeable in This reflect on levels record. turns believe XXXX shipment RV we highest sales will inventories specifically, down

targeting We be also generate levels versus historical higher and will inventory turns believe that profits. that dealers will operating times elevated

product. our produce As this very dynamic always, enterprise will responsibly and industry, ship in

mandate strategies In is executing especially industry within to we the we as the replenish, impact to to to short, will strong we model overdrive but inventory at our not enterprise-wide Industries continue match forces constraints with on we the building will on business much Winnebago work those dealer our mitigate continuing and our levels anticipate of supply our imperative confirmed as levels. as important are works and orders. to possible. suppliers This and is While proven Most with dealer chain continue, inflation production our closely focus momentum. importantly,

intimacy customer tools. keep to as Winnebago in with brands And our inflation, capital allow to deliver dedication and future Industries constantly constraints hard supply especially line despite of employees' product our related of business strength The in future the monitoring. new are environment. chain us winning superior significant stronger We projects, will which we're investing innovation to demand position us well, expansion, the execution relentless work positive and will unique and

to room in and our investors for of X last continued the progress significant I'd years. X to much have navigate improvement. the made We we've to remind like

million to Our trailing XX-month XXXX. compares the sales $XXX at of of billion $X.X end fiscal

Our fiscal fiscal XX.X% year-to-date in XXXX. XX.X% gross margin to compares

Our current of end RV at share to the of compares XXXX. X.X% XX.X% X-month trailing

XX% of XXXX. capital year compares fiscal working XX% favorably approximate Our in this to in

more is under than four months, quarters, cash of Our fiscal the the million last for have leverage each ratio XX of $XXX in and last shareholders. to returned Xx we

We is short-term and the work, but but long-term, are marketplace, the the in team's in shareholders. bar high hard our proud we in with our recognize of both the

We are profitable confident end for portfolio and our growth and consumers, creation dealers, shareholders. for that sustained headroom Winnebago Industries employees has significant our enhanced across value

Before I remiss to it we would the open to in situation acknowledge be Ukraine. up questions, devastating not

by have do we we supply feel any everyone people and Ukrainian that affected not tragic manage our can the indirect chain situation. and region in implications, are While this the physical with thoughts any operations

we As Industries commitment Russian National Manufacturers to aggression. for hope grant you in Disaster for our it support part demon will for Q&A Association with time. all your back to morning, Winnebago peaceful resolution of sincerely has Philanthropy session. this For the a the Like recent the operator you, of prepared turn citizenship now concludes our joined the and a of values, I resolution. can to corporate made Center and remarks and to Thank over That our again


with Gerrick comes question BMO Instructions] [Operator Johnson of Markets. the first from line you. Our Capital Thank

is open. Your line

Gerrick Johnson

Hey, good I questions. you. Thank morning. two have

little be And in that this talk forward of say, you environment? you pricing you different about First, going Where ASP or price power highest classes pricing bit? on would confidence what growth. Where less driving on the gives the power? having having you're a models? Can increases level

Bryan Hughes

Gerrick. Bryan. morning, is This Good

balanced and We across consistent are seeing pretty the brands. it

inflationary seen it course. our pricing the doing as I our characterized the trying the match We we're on think already we’ve And we’ve best towards of inflation as are pressures. that’s products come that get as to inflation that well through ahead to anticipating, of how historically

brand, significantly. quite If varies at it by it you look

range is. of keeping And so, any kind to And inflationary to take we've in higher. and it numbers. certainly It that the double-digit with is give is specific I in But some it pricing. as had pressures to date, material, say, our you stated, cases, to the are we suffice pace

we is historical the relates of pressure. inflationary that and where position it the continue from is to monitor forward see our That some the in going will the for continued to we a view, half year, thought As environment easing back current inflation. expectations have a our pressures. go-forward we of Certainly, would change inflationary

current the the XXXX. what geopolitical some understands situation we half everybody see the sustained that pressures Ukraine as now inflationary back unrest think will into of the and I in

to monitor that. continue marketplace. will We do in we we the believe pricing So, have that power

initiatives with maintain offset will extent pressures to We will our but or That cost with seek inflationary goal be. to has initiatives, it unit, per need and just avoidance been cost we to continue margin, the savings per the dollar first the price not and the margin to that to will continue we to unit. historically stance

Gerrick Johnson

you Okay. you, hands? I How Are door deposits, or out those going measuring the actually units orders can ask sales are changing Thanks. results? placed you Marine [ph] And RV results those Thank shows. at record you. mentioned and

Michael Happe

at our the of those Yes, off lots at is Each is various retail Mike. not the sales retail throughout Gerrick, Usually, brands shows. spring. the shows this retail tracks shipped product of

physically, agreement consummated a taken as well. most in usually transacted there financing but not So, deposit product is cases is physically a often and

importantly, this something the especially close shows more see positive. versus And setting been brands in years. And spring our very last for shows. X to retail rates been we've been at records doing the So, retail is at the But years traffic pleased X the or we've for have foot again, this decent

Gerrick Johnson

Thanks. Okay, great. Thank you, Mike.


Thank you.

Stember with King. Scott Our line next C.L. from comes the question of

Your line is open.

Scott Stember

questions. Thanks my guys. taking for morning, Good

Michael Happe

Good morning, Scott.

Scott Stember

that. pricing a guess fuel front point, some in costs would go of the other some at narrative last was the to end before recent there I everything dealers we But the skyrocket? absorb The guess, just to since to fuel and that, changed have else we that, months this were sorry I seen of we’ve would to commodities. they that prices back and had pricing environment? belief on Can start has moderate. skyrocketing and

Michael Happe

retail of good Scott, to week higher talk Georgia. in of We most in at beginning Yes, they're opportunity we the opportunity And meeting to last the X of one for able in flagship prepared One run last our morning. that dynamics are their pricing meeting are brand comments, they Mike. This maximum notable host in throughout seeing dealer levels A very profitability national had turn probably way dealers their business a it were brands, to about doing determined power see at XXXX a environment where had the the that pre-COVID. Winnebago is and sales hundreds sustained business. was versus levels couple attendance months. the at is, to the what be to mentioned higher to in dealers our that I in beyond of of retail to and XX They things. as not is

react seeing and you preferences. little dealers become deem retail margin acceptable a in the as be what room And market they consumers' to are able have sharper so, the the pricing pricing to bit to versus

pricing to and that are business of specific quarter, Our brands is until products have have with the around delayed little they dealer effectively, efficiently market our innovate the particularly some motorhome When that’s power with were in this new where pricing to products work appeal products consumers we a to we get ability the find can can brands and If that bit position new get our market that as delayed new to going. the power we to stream that optimal degree new products. those pricing the to in those market. and we is really

Scott Stember

fears just maybe the people like again, you being that talk and what it. as concerns the your XXXX. allay judicious, share that seeing of in be back refilling happened once you that maybe in Can of investment then anything well lots competitors it of Got to you the have is can body. a And go if that community equilibrium past obviously, any we about But the everybody a seems guys dealer in will lot repeat more XXXX? just about inventory talking could pipeline

Michael Happe

our can speak Yes, Scott, we can't as can competitors. We reflect for marketplace what's happening in you imagine, today. the only

We extreme inventory yet not stock any discounting open hearing significant dealers. signs OEMs of of by to are the

some within seeing make are OEMs. the at manufacturers in OEMs orders the cases, that want when what refine the to and they those exactly fresh dealers take orders dealer a We know industry to to review sure look want orders And those and their products them.

refreshing are not irrational So, we’ve the this market into of in going major we hearing of but hearing some on the many by time. of loading dealers industry, any been inventory order the at

continue We time, in orders and will of rational, make retail continue and confirmed own production a to think this But of an to to a house and see continue every what as of on that land our to marketplace our will take in unit only are can we inventory care either the it we appropriate customer's of new it system. we return normal is believe manner. dealer the to name sure has make or a customers on name

Scott Stember

all That’s you. Thank right it. Got now. have I

Michael Happe

Thank you.


you. Thank

comes Kennison of the question next Baird. Craig with Our from line

Your line is open.

Craig Kennison

as Ukraine, Hey, good Mike, taking morning. the well. my a higher rising for and prices Thanks interest potentially you mentioned situation and questions oil we have in also rates.

seen the the preparing sort how channel for the does that of past be there. given recession? economic than what of might in maybe Winnebago and brand, with one your we’ve happens, inventory upcoming recession, And How lots situation this in if concerns the different with is next out dynamics? how So, other

Michael Happe

leadership, any, the a call has look Industries, did based playbook Bryan recession knowledge collapse elevated looked also XXXX foreshadowing systems did think, based we and in morning. the in we the we of the a company because we in different and a Thanks, variable company. discipline, probably call Hughes are of our in of our this demand both access predicting just to process and on on Specific industry. is want And highly outdoor business a XXXX sheet retailer on wholesale the XXXX balance than clear, company the within in commitment down is past people to information, and our based business cycles we to I strong are and But may does each With but Yes. our not we products we significant And lines structure not are XXXX in economically. of different have, in an profitability what Winnebago environments. to in higher guess, cost have, levels in manage the liquidity and of our of candidly, portfolio I access recessionary Craig be good industry of and than position. to condition.

a So, the in but forward. industry one a selective we downturn new candidly to go systems healthy the have in invest products downturn in that's continuing midst and we or that significant And economic a right or that. have short of through business answer long believe can to future, its whether to new any question, still we as wherewithal be

record of cases, anywhere severity. And the most have ranged industry that. downturns the As its to generally, X in industry in almost XX of in they have out all you been RV from But to brief market a tenure. new the high know, coming in returns relatively months

momentum importantly, invest way So, business ride any we difficult as through going future so forward. be And have coming difficult a out times. of our prepared be prepared to continue some that disciplined should will we times, any will to to in

Craig Kennison

even of are that, significant margin. if those improvement changes volume structural can Thanks. they're gains, you think Wondering follow-up to you've sustainable scenario, business better Motorhome whether made that your whether think just in in one to you to change recessionary or on you been was substantial which a have the and hang think margins. And a as dependent I

Michael Happe

that belief our structural is of our Craig, some step in a degree, be Yes, changes sustainable. we’ve to the made large should, business stair profitability that Motorhome

that bring in double-digit Motorhome high business way I if to believe years be, to scenario a got we were discussion Motorhome is now would business certain gross yield is sustainable that X hypothetical be and the future. worst-case our our at but area want And profitability. run into in today the -- something that a our EBITDA based a our plus we of a what would like strongly changes that scenarios, we what don't roughly there they adjusted could a look now good can believe what are is into business, that we on level the Now margins in a test case Certainly, factors double but get profitability to profitability it worst majority sustaining at market. we on ago, where what the you shot have the

Bryan Hughes

add to would of variable Craig, only the a is thing that structure. our just reminder cost I

talking XX% in You volume? you're business what question your asked range, at way which on to continue XX% intentionally happens in hey, a structure maintain cost very of, to the highly We about. variable to depending profitability a with that

the structure. And right so that is still cost variable part very intentional our assumption that it's to on and maintain

Craig Kennison

Great. Thank you.


you. Thank

next line question Swartz of comes from the Our Mike Truist. with

line is Your open.

Michael Swartz

guys. Hey,

I'm understand over takes quarter, seen the of towable we step Maybe pricing help and had pricing, was along increases in and some discussion. being past continue there to but the in of the in with sequentially pretty just the can back business, to a years. price increases you maybe saw just pullback there understand consistent trying why that Towable? on puts the lines quarter-over-quarter in the Just the couple we of us ASPs put through, Obviously,

Bryan Hughes

time, question. -- sorts, certainly an QX The for -- a Yes Towables thanks was I to of some that to with pressures when think perfectly in cases, are the the as in outlier referencing up pricing with little the XX% necessarily the the P&L. At in the and over it realized don’t high that Mike, XX% the timing of increases mentioned that we inflationary segment relative acknowledged such you're saw we XX%. very XX% match in that

in cases. So, some in words, other price ahead of inflation you

And so answer certainly the of part there. that was

our disruptions had weather productivity supply also We that We affected bit. in acute the the to have second We some chain some well productivity. a as had events. challenges some quarter did

QX it about little of and couple bit QX we very the we a think that margins the of business strong yes, the feel really matter. was for So, there a did But we takeaway is the sequentially, step see we good realized from for big Towables in things. Motorized for a But, still down the margins I business realized.

Michael Swartz

a just I the that the maybe And the a talking Okay. in quarter, just quarter was ASPs there total I clarification. second between I’m and change mean about Was margins, the didn’t mix business. sorry, significant? first was

Bryan Hughes


I the fifth think the towards tilted than growing travel it's more faster trailers. They are wheels. much

ASP see you And that impact so, an change. from mix do

Michael Swartz

the maybe know better with trying to with dealers. given been been dealer constrained to Barletta, that’s on understand to share opportunity expansion, switching Okay. inventory at going maybe somewhat just just Perfect. over I there. growth then existing rebuild they've everything trying And

to a So sense fruition? we start give us come to those of see maybe when of future opportunities some should

Michael Happe

dealer are continues way, through you product some future to multiple, Barletta new future and add as experience network network. growth you'll dealers line as opportunity in to Mike, additionally, and to expansion existing see organic the the its have by stated, its Yes, both their of ideas that And, well.

new able that carry quickly feel business share almost across to as set product So, been market country. not new additional primary we the next three existing has being to we Barletta Barletta and I that and they’ve you'll And the dealers course go to with grow do the make loyalty that like in the obligation sure that before committed supply dealer The orders catalog. channel as in think we product an dealers and the candidly expand We the several its new to business would deliver see solely believe line to the and up factor the over today penetration can exclusively and that, that chain to constraints. the products of can team us a dealer ways: the years. that dealers,

and production have are but also yet, our can 'XX any we share team fiscal to to we output specific I as more details as begin point that XXXX. line probably for into at a product with the year fall the the won't some so stability corner entertain We turn calendar that this expansion We chain year plans into getting within well. business Barletta and think that supply

Barletta with industry North maintain Barletta top that I convicted around potential X months we’ve percentage is of referenced from the their at range we potentially around here to market the to in still in today. are that that double-digit we pontoon the continued business comments, as is market and as American date. is someday. So, share And X very with first And performance pleased as sit X% share brand the a in my

Michael Swartz

the great. for Okay, Thanks color.


question of the KeyBanc. Andress next line Brett comes Thank you. our from with

is line open. Your

Brett Andress

Hey. morning, Good guys.

trying think I think, results are end, out I to one trying thing maybe I'm two saw today that’s not But compared I’m your don't and investors to January approach. a from you in did that or the question. compare necessarily in this what quarter? change tease the to peer is your February a is quarter of comparing pricing standpoint power anything right months maybe X to at first chain the either margin getting the in what had supply

Michael Happe

is macro, companies. between just volatile January this business. is change and direct February. in did could the peer noise, I our Certainly, with would within of not than half -- we say external and factors that not a I demonstrably different I important enough overnight stay and Mike. all list is them. comparisons say at some January to times it would of dramatically industry Brett, dozen the again, between February marketplace I was today think But clear

portfolio-wise complexion that Our is different.

integrated. or less companies Some are vertically more

geographically Some companies less or more diversified. are

on companies disciplined are more production and Some share versus market candidly shipment share systems. less or

as we healthy here results. gains, in sit are morning to market our the back And pleased this we year our continue half margin produce to we with stability. Share have so, And confidence of results. consistent

Brett Andress

to Scott's but I think call last in it you're sentiment Is there the around it two I you have insights. retail real-time historically, week dashboard? want however up the what answered have anything to on as us, call, Understood. then, that consumer Mike, you're this to you think it. some in like gas things or And you Got some you. up of that think, your rates, come relates giving right, or question, a seeing frame I it lot of this

Michael Happe

maybe that just you of believe don’t in Well, we're element, several interest We stock believe we factors needle factors, move or on more certainly have gas any prices, are tracking than a a short-term. obviously, consumers demand. impact or in recent of those dramatically can which of volatility, a consumer there. aggregate of that rates, in together drop feeling, can metric nervous the in the year single maybe negative last And certainly any of the combination element are released and an probably today did put the do net was that how mentioned a bit believer net that positive result all always We not been itself market that consumer X, for when single We notice, confidence recently. sure. in a they little

but spot in much So, we've been some a as year have now. for will that stronger than describing retail our Not recent years time results you ago, strong as been that I ago. quite tell sweet X

lower. it believe results calendar RVs year stated, X little probably describe worst-case the still, of in environment the we retail fall if for March two XXXX we X.X can selling But demand how XXXX. I that's healthy calendar as recent environment. our in in result very early And top be year that probably would were and million a a industry So retail opinion, a consumer than is in more top a to RV

Brett Andress

I appreciate Very helpful. it.


Thank you.

the next Wolfe comes Wightman of Our from question with Fred Research. line

line is Your open.

Frederick Wightman

just your Hey, to guys. I outlook. wanted wholesale follow-up on

of to to RVIA currently, a the the range. I think down even for is year. where That low little mid-single-digit seems you at the be bit below said low-single-digit end the

you're the think be a of walk more will of at next Do you not level? it control could be few but in that Do through you of step see wholesale down? how it high will trending? sort you sort entire understanding function of the months just So, you gradual a industry, think

Michael Happe

on the the XXX, certainly of midpoint Yes, I their conversation the of control ultimately that is sort communicated that’s mean end think, higher wholesale Association morning. in We around the aren't of that’s I ultimately contribute the number. projection we the the range correct. entire we that of forecast RV this that within to Industry releases. industry The

OEMs bit downside to all our is So, around around probably to will hope there infer little as could is relative that to of be in And we that will normalize start that. and responsible industry we this But the retail in continue industry. RV that turns environment you could the hope/anticipation be to what the other turns believe a well. X

put a say dramatically So, range just a I wouldn't but downward environment slightly thinking, healthy still extends a today, have but opinion. in we wholesale probably it's that environment new our

Frederick Wightman

how at replenishment March sense. and trends last retail sort April look inventory then Mike, just highlighted Makes comments just you've just horizon. be the would for quarter, February, your And of important if we

of that could of has shaken sort to into you normalizing out how in the you to would what how of that Just hoped middle towable sort summarize date feeds 'XX? versus this see have and inventory

Michael Happe


supply That’s probably I to key think to a industry have work would maybe than segment enough X replenishment the faster product gone chain OEMs the Towables those backlogs. suppliers the in credit thought to has to down and the of try months ago. get the some category Towable us of in about able being candidly

probably to on say the in last biggest been the pace development that's the would X towable of has recovery segment. I months RV the X So,

seen segment inventory. field not the have nor pace of of that recovery We type boating on motorized RV on

segment, in category RV XXXX we and motorized the in have XXXX be in, the that two inventories into believe both before still will normal. field that we compete so, Marine categories the And runway

chatter our the from production not about are unhealthy how us the understand an overstocking see RV to we their shipment OEMs standpoint. what the production dealers I with to they're are competitors But behavior things of hearing schedules. And wait we'll back March from how earlier, to and as frequent So, doing the positive in said coming managing other were numbers are standpoint. industry a

think And industry we dealers has in settles. work enough the think on the the X I in go here, to see will the future. sure of months have I how product continuously sort making towables then So, to motorized market next

Frederick Wightman

Perfect. Thanks guys.


you. Thank

Bret comes the line Our Jefferies. Jordan from of next question with

open. is line Your


with of chain things with This Ethan can maybe Thanks engines? about for And cadence I for improve, is talk questions. Bret. guess, front morning. taking our good you marine and seen on Maybe on supply Hi, secondly, both just Huntley motorhomes then you've chassis? the whether

Michael Happe

that front, engines good say been the brands consistent both the brands. of primary one predominantly been with X in leading engines very last the relatively to of here on to months. the on I of supplier And our has On our and would product of Marine Marine we side work use marine has X

Marine to And suppliers month, be can so best continues word there. just inconsistent, some business get them have more There bit chassis supply motorized Motorized will for earn months else. to prospects The right challenges. anticipate and the that one supply our And that growth in giving environment We is to stable. be next us use chassis category then work I'll is from someone happen. both a is in continue to the the of the certainly certain it we'll are supplier where of future, the with we which

time. the constant and And chip to won't periods inventory you unavailable a see where chassis face. for of obviously challenges of that see can can ask We chassis they manufacturers sometimes to ample periods of drought buy become those that take and on it's just into or flow period semiconductor sometimes supply us not -- chassis get the the as especially details I in motorized into with well But always how -- sort daily chassis works. a of due so supply

stability to Unfortunately, that think anticipate chain of the And through we word inconsistency. so probably is rest fight again, there. chassis the motorized continue supply will we for XXXX, best don't inconsistent I


your just at the that business. of Can use business? here, significant side might we’ve retail and the placed is Got maybe heard takes some just walk you through emphasis on helpful. as to being then And lastly level, how sort it. of us puts any the affect That’s

Michael Happe

product the We the the do very business to inventory It want Yes. consumers certainly, that emphasis exit and activating of We allows a we does allows And as and little is a secular it thing. plans a and so of we certainly reemerge also often vary popularity healthy imperative the model lifestyle than in more to business within believe to this it's turn buying from growth consumers both partners, And been able here dealer. product their their who some a as an have people against work we to are And time. market in efficiently, want good models, get dealer in aware on at direct pricing. well. dealers continue our dealer continue of OEM, think with way to industry lifestyle and bit be on outdoors, our inventory who used inventory in used not of used particularly intentions larger so supply believe that allows we used within market around that a their for a do to the healthy are affordable new. strategies to terms but to used the into the with stable something as

to that market are elevated so, creative or moderating year And very how new us and used businesses we on ago. closely on with market, we products. partners improving and are But impact just still our to dealers do understand dealer two product have any to there they'll from work they're the what secure be bit continuing see our on if across product a although versus to a prices take

used field product as itself that new heal will with along market that anticipate we inventory So, the well.


color. appreciate the I Great.


you. Thank

with David Morningstar. next Our of from Whiston line the question comes

open. Your is line

David Whiston

Thanks. Good morning.

favorable were for A impacting C and result B? B First fell. supply up, A segment? it problems on are a that more curious, demand units C is Motorized, of just is the that and Class the chain while B than Or [ph] more I'm

Michael Happe

was in QX. we challenged Our issues quarter seen in segment more chain past QX than this probably Motorhome with supply had

is branded and flocking I other only say the have would our supply consumers both mix And of reasons The David, that of very the some efficiencies the ASP that chain will shipped though, products factor consequently that Winnebago across as will that called you within motorized brands. the product we the well affect margin and affect mix segment. new see to. a Echo Newmar so for Winnebago are that tremendous and for

And orders viral challenges did resolved a it. That’s the around continue the in increase Class to we RV like There's anticipate marketplace. quarter. else which really to try this output to product a be and some product market we and and are in back QX is nothing of that. than We Echo, past flow on C And those QX. have very a amount of our QX will product, into run that significant on in better being echoes the we hot in

very So, healthy of the and to reasons vary, but to chain it our many almost motorized at all is months point related supply backlog long. as continues constraints this be

David Whiston

it like supply other company. the and chassis? it are made you’ve of that other Is more X And mostly chain or issues chassis that the parts you Is areas? than -- like clear seems motorized impacting X definitely key it

Michael Happe

challenges that continue But the -- on elevated mean that some times. category waiting the to phone this it has sitting motorhomes within of it the an before like you inventory shipped at terms market. door. unfinished of product of component we will part in a out say numbers, to generation have if some challenged at always going on would we for we are see us is see times and you which in probably never I with name of final QX inventory our numbers, getting terms specific suppliers. have look At I’m key Unfortunately, that’s the Chassis parts. means grounds I the still to call a portable I at names our -- products. in power times,

do So, than we motorized days. we continue to battle the these supply chain more so towables on

David Whiston

first working AR this was big of flow on that? there's headwind And statement, in through capital and a cash driving at not year. last What's the time present that half

Bryan Hughes

this is David. Bryan, Yes,

the quarter, the all happen. seeing are deliveries. Some be the we It's resolved that issues same. later the the might extent of that timing it's chain of And to is supply in which

that So, will understand we have we shipped. that us, the end quarter the through therefore, towards at the end more the results tilted quarter receivable our to shipments timing to And the accounts the end come with get of of and and elevated. help the of pressure be of in units for oftentimes, quarter vendors

mitigating inventory the into accounts at from some of quarter So, it timing problem In some the problem those efforts. respects, an shifts. of end receivable just

David Whiston

the fuel probably release to emerging And be interested saw in XXX be Winnebago ERV, and miles they development and Okay. the that’s oversimplification. cell, someone or casually your must electric well, finally, just was then RV on an if of miles XXX with and someone integrated think, an in battery not might and space, it's with fair tempted ahead

what curious be? response would Just your

Michael Happe

product David, we're having a that very features and RV interested in in marketplace capabilities acceptable are electric for focused that on has consumers the high-quality that product.

concept technology existing vehicle driven that’s extensively with has in the Our the been product.

exactly a are that’s this real We at with what communicating that’s is been extensively. product we been driven know a concept model time

technology And in with not number our and will been electric commercially partners and extension to our that technology proven motor engineering our range test stick environment be descriptors feature feasible. chassis may teams and Our or any or that does include our to not continue may have financially motorized we partners. through

in the extensive an to actual as for the what what through we’ve whoever way release in the market products will what long-term consume. testing. product competition worried RVs let we describe are communicated products that future market in And know in future. their and our they in we today choose. around will we sell is it about not having So, the the But is, not the competitive And we electric

We have higher we today. stated market range product X what goes times several to that in anticipate last we the the when be than are to communicating months the

project. So, engineering patient and that through we development as everybody product work the would be of to just ask I stages

David Whiston

you. Thank That sense. makes


Thank you.

comes Raymond James. question from Joe Altobello line Our of next with the

open. line is Your

Joseph Altobello

Good Hey, guys. morning.

part Just but it. your for order, represents a clarification, more that you mentioned the dealers. that you. dealer name order quick necessarily on ones two the firm doesn't of first, mean point say a of guess, refreshing When you on of customer's backlog, I

retail you of point? backlog your what is sold do So, know at percentage this today

Michael Happe

and and The that and sold as can dealers canceled varies by use positions. the our our in higher been -- lowest That our somewhere certainly and double is morning. back cases, highest could categories on we how It's in even number Newmar approaching percentage dealers does our as number low that good Chris-Craft probably brands continue deem. the some volume travel revisit probably orders as is collectively retail Joe, on brands be high they luxury XX%. by where brand. to those as vary team probably trailer of define And be digits. integrity process very we they that the of clear It order we've sales the in and on

between retail answer brand. and environment sold retail heats the varies will your rate are inventory. the our refresh high March We probably mix of field and in in up seasonally orders July, increase the cancellation especially seeing question, that the orders are at of to of widely we this just the of and dealers a anticipate stocking the dealer do inconsistency through that seeing based that go as unfortunately, of We mix Rather, some in to just product, on timing category inventory not -- channel. time. continue But

Joseph Altobello

to were new as margins but elevated at same it well wouldn't back and swallow I down you guess most increases. margin this elevated, to are that expected Okay. almost Obviously, expect your to pushback towable normal helpful. to does the dealers on secondly, since versus side is historical. retail inventories see That’s is you And price of why sound like their be expect your the year. on some maybe time,

So, I'm for discussions are a get trying to those sense going. just how

Michael Happe

them. we from or handle. subsided in would degree increase are hands that terms of our QX times with cost pressures teams frequency QX. And accept. there market unfortunately, again, presidents the conversations have very the dealers the assure can the everyone having about you our believe not with and we our are where direct can what I feels tied very Joe, in market inflationary what I of tell you can those that about face their unit our the robust the discussions suppliers dealers by are significantly But pricing are the And business versus

us a again, and was that we’ve in the inflationary an have continue price pricing new our recognize going price period. price time than in sort you year. increase day can not in for on we It refresh that environment plans, whether some more on parties future be been I healthy for to cycle probably very, be now to sort But so, terms of dealers. partnership it raise we X. late in ability continue increase margin we But products, with here call time if challenged our roughly floor longer. will And for of between stability of come that believe both dealers, would very out with a high-quality And our or just surprising to conversations that about the say probably wouldn't are we

Joseph Altobello

great. guys. Thanks Okay,


Thank you.

a of line have C.L. Stember with follow-up Scott King. from We the

Your line is open.

Scott Stember

My question you. has been already answered. Thank


for Thank showing back to the questions remarks. I in turn call over to I’m closing no further you. queue. would the now Steve like

Steven Stuber

Towanda, Thank today. call joining everyone, for thank Great. you, our you, and

outdoors. official everyone of enjoy more again With past a is we for hope this certainly thanks Sunday, in our have to time us. that, great plans the the day, enjoying joining spring and start With


Thank call. conference Ladies your and concludes this you for participation. gentlemen, today's

disconnect. now may You