Fleetwood Enterprises’ Profit Driven by Strong RV Sales
After two straight years of losses, Fleetwood Enterprises Inc. said Thursday that it had a profit for its fiscal quarter ended July 27, thanks to strong RV sales and a return to profitability in its long-slumping manufactured housing business.
The Riverside-based company, which makes prefabricated homes and is the country’s largest recreational vehicle manufacturer, forecast continued profitability for the current quarter and said it would keep adding jobs in key states as business improved.
Fleetwood reported net income of $1.9 million, or 5 cents a share, for the fiscal first quarter, up from a year-earlier loss of $1.5 million, or 4 cents. The latest earnings beat analysts’ expectations by a penny. Revenue rose to $646 million from $611 million.
President and Chief Executive Edward B. Caudill told investors and analysts Thursday that the company was finally positioned for financial growth and improved performance.
The company said sales from its recreational vehicle group -- motor homes and travel trailers -- rose 18% to $437 million, a full one-fourth of the nation’s market for RVs.
Manufactured housing sales, which had been down nearly 30% in the previous quarter, fell 13% in the latest quarter to $200 million, giving Fleetwood hope that the worst of the slowdown for that industry is over.
The industry has suffered amid the weak economy and the lack of available financing for buyers of prefabricated homes. The narrowing of the sales decline “indicates positive results for the immediate future,” said Chief Financial Officer Boyd R. Plowman.
In July, Fleetwood announced it would hire more than 1,000 workers over the next year in states where it previously had closed plants, including Georgia, North Carolina, Indiana, Florida and Texas. The company cited strong orders for RVs and increasing demand for its prefabricated homes. About 700 new employees have been added.
The expansion came after Fleetwood lost more than $100 million over the last two years, as consumers delayed purchases of luxury items.
Fleetwood shares fell 44 cents to $10.29 on the New York Stock Exchange.
