Winnebago Industries (WGO) 16 Dec 222023 Q1 Earnings call transcript

Good day, and thank you for standing by. Welcome to the First Quarter Fiscal 2023 Winnebago Industries Financial Results Conference Call. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to turn the call over to, Ray Posadas, Vice President of Investor Relations and Market Intelligence.

begin. may You

President and Officer. discuss everyone, first I for us President Michael joining joined Bryan Officer; Good Senior Hughes, fiscal thank XXXX to Vice Happe, our by the the call today our will our This call on the Chief results results. Chief first live today release Executive of broadcast on quarter today. and our website news Financial available and replay our morning, on and call website you and issued is being quarter at later am The earnings investor.wgo.net morning. posted and earlier website was be with to this

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

morning, Ray. Thanks, everyone. Good

Bryan more our results cover I and initiate performance in of to and interest first Industries your financial spending with a results. appreciate Winnebago detail. fiscal our in conversion pass we the quarter with the broad the review will always, XXXX to then us time As Hughes quarter during financial call overview to our

amid a turning to portfolio offer then thoughts of closing difficult are conditions. strength, Industries Winnebago will industry We first our macroeconomic the diversification quarter brand results more resiliency and to your and testament before questions. some

in XXXX XXXX the to first RV growth for RV fiscal period we of tremendous product the quarter, our for and demand lineups a years. premium our expected, lapping normalize continue As in lifestyle

underlying setting of this impact and a that record we many of long-term, diverse results are our to industry continue come. introduction many more the new, significant the families and RV of While could fiscal fiscal to believe remain RV brands as younger secular our drivers have facing for the XXXX including and of thousands XXXX. Industries positive in likely premium comparisons customers of the Winnebago to stabilizes years difficult throughout period will

in that challenges expect near-term these That and Our rates performance said, was that reasonable immensely I our balanced places operations, are for chain, supply arduous The increase line to revenue more proud of that the our increasingly economic am first team result, that slowdown, was teammates external exceeded agility factors we meaningful, in work still a result our macroeconomic at lower our managed and cycle. of outdoor consumer Industries' bottom our drive of a results. an as to This lower their impact broader also economic expectations. nimbly while and streams most interest includes challenged the higher Winnebago quarter. of several by inflation various enhance profit trending is solid efficiency outstanding confidence. results stability portfolio general the the

investing XX.X%. net gross of $XXX drive threads we margin period. the million a growth Winnebago decline recreation strengthening can We and control stay Ultimately, XX% revenues in Industries in consolidated we golden realized profitable of our quality, outdoor innovation achieved for experience come. of and years year-ago our will from of in focused quarter, to the the on cannot immediate market size While the in certainly overall that the near-term, a

fiscal to up levels, year-over-year, margin of earnings gross when down and share XXXX delivered first we it XXX $X.XX. quarter, remains well pre-pandemic consolidated above basis While per compared was adjusted points diluted

reflect strong robust to remain organization historic are of high today. these that the we year, model, of more compared down last results levels record While our resilience products a vibrancy operating our and and the

were a factors. by few results Our key driven

of our premium lifestyle strength innovative portfolio. our and product the First, outdoor brands

has Some marine voting of Day growth and simply its to They and best now chapter growth month. approach current purchase you We lineup mobility our begin at last our Barletta, focused competitiveness, of the is and a in becoming Winnebago market of and The products of premium saw function decisions. profitability of just our X% of well-rounded today action which XXXX best and with the the was of August our organic by in their the seen on customers pontoons. example Barletta are ago formula in feel, to our pontoons of market a years this material the are recreation almost five outdoor leader. health Investor story share acquired the founded more some Marine is incredibly on remained Industries, The and market. business. segment

Winnebago was and of which despite is innovation from by flexible the differentiated Index Our our market and HIKE We customer part "RV Dealer brands, that maintain in first cost Dealer quarter on profitability of off-grid FLX results highly quality. second began compliments of production Industries full our drive expand recently driver Design, Grand capabilities. to our pressure segments operating the model places commitment topline. to RV shipment XXXX Satisfaction operational recent three variable year emphasis RV XXX initiative product RVBusiness our Association, all into of was and our structure This awards the on Year" in the A and an a strong the excellence, key enabled trailer, received which with named new Winnebago, off-road travel to magazine. Newmar, a model which special

with company-wide capabilities practices, focus initiatives benefits significant Mercedes-Benz year best supplier include example insights factors our relationships. another on units certain an quarter external individual sourcing are AGs long-term consumer well. function, These dealer XXXX the first recent finally, to our And and recall an meaningful Our our enterprise. network the experience, deep, of of Sprinter across enterprise all XXXX operational business on strategic the was leverage model and excellence shared of impacts that manufacturing had The Chassis. our initiatives performance as overlapping outstanding consumer most

our negatively during last Investor is calendar sometime discussed Industries or the any affected recall quarter grew from including impacted solid our quarter issue retail profile. strength our Notably, of we segment and in month, results, cash and a line the levels bottom dealers the continued chassis in first until currently Motorhome operations delivered that of This reflecting this inventory OEMs, As XXXX. remedy the and revenue despite flow. implemented quarter first products first profitability, Day industry delivering and impact, we upfitters, prevents all shipping, of selling, Winnebago using margin our top and fundamental and this

inventory. is are towables dealer managing our RV The second we for external demand the factor wholesale actively

As I dealer have previously, and segments levels, our production our behavior, schedules in is backlog of across mentioned in ways forms reporting turn diverse each experiencing impacts varying stocking inventory of which channel portfolio.

and levels segment. in especially closely this Towable inventories align normalized with dealer to are We RV production managing

replenish in businesses various While and low dealer carefully remain that to sub-segments. work our Marine inventories Motorhome

focus to a demand production businesses are rigor and across We needs and calibrate value in of further our the exercising levels. sustainable dealers by on to focused on long-term our adjusting consumer

real supply that our disruption in market to chain to as us allows despite model operating some we adjust manufacturing profitably our dynamics. time do Our

Marine more proud of strong portfolio are can demonstrate segments in how and were the balanced our helping the of deliver challenging decline in and Motorhome We our Industries quarter offset that and performance diversified and first towables. benefits through results Winnebago to by will growth the Furthermore, in evidenced the profitability cycles. our

Our of its revenues as the Motorhome At our to and highlighting value mentioned, year-over-year our trajectory revenues and brand. quarter benefiting I initiatives XX% continue the growing the tremendous continues time, as continued in momentum the success in grew consumers for the growth with Marine XX% XX% in of Barletta market. our first that segment of see our the from products strong same in year-over-year specifically revenue, accounted segment, segment

our I call innovation to Chief enterprise review first we fiscal in quarter and to long-term Hughes, now XXXX results detail. and financial Our experience that the synergy enhance Financial will positioned broad commitment and over to well more to create and our With our value. ensure Bryan capabilities Bryan? Officer, summary, quality, turn resiliency portfolio, are

Thanks, Mike, and good morning, everyone.

First compared $X.X a XX% quarter for approximately fiscal the to decrease XXXX period. $XXX.X of reflecting revenues were million, billion

accounting was lows, all-time where diluted segment. and quarter or XX.X% prior XX.X% sales, lower of in as in of products from to extraordinary trends Reported comparing of prevented recall-related quarter, and year, decreased our earnings quarter any mentioned, last We the earnings an treatment first capital, expected $XX by when Our inflation. from that new and to out decreased strong chassis XXXX. is income period first $XX.X impact production quarter. well $XXX.X of impacted first Mike to were inefficiencies, like same the lower for by topline was in working performance compared convertible first similar first earnings back $X.XX unit million which at leverage, was XX.X% recall, adopted year $X.XX the share share in points within delivering EBITDA Towable a of XX.X% impacted impact quarter the million was Fiscal the pricing XX.X% would for accounting from factors, net was negative XX% particularly prior against million XXXX, were of $XXX.X cooling million, the Gross driven million $XXX.X us after compared recorded to XXX last a XXXX diluted the the $XX.X compared to Adjusted by to resulted quarter shipping, per the lower a profit which Operating than last impacts XXXX. for than per Consolidated we the operating $XX.X quarter taken including a related recall, adjusted sales, to to to of year-over-year as segment diluted year in margin year first inventories and basis driven million the for last net notes. $X.XX. reported seasonal our share in year. the approximately quarter was $XX decrease year. the normalization performance also to Towable million income decreased number the million selling, period dealer in during million of estimated AG Gross ahead in demand, I the during in driving of have profit profitability chassis QX Mercedes-Benz the of standard of $XXX.X for which expected quarter included a QX. call $X.XX

conversion assume or per earnings by shares result of interest notes. to added or the discount the the year The of non-cash Prior required diluted recognize a entire standard not new calculation non-cash accounting a longer affected we share convertible interest standard. related results the the no calculation. from this also As notes new accounting adoption, the expense to underlying and convertible to of charges adjusted be amount back were otherwise requires

of be Our we to of our of which call/spread how basis at pronouncement adjustment the the results Accordingly, EPS $XX.XX. adjustment adoption doing of on outstanding accounting the when warrants, the by strike price until we this notes. have that notes. exceeds benefit adjust EPS dilutive an way, economic in price been of share we the the the adjusted equivalent will is following diluted impact previously this removing recognized adjusted the new calculation we convertible the we In overlay implemented shares with convertible the issued in diluted

Segment the points historical as was down turn to starting $XX.X declines was XX.X% only down with basis production sequentially consumer This year schedules was the XX.X% from XX.X%, the compared inventories. segment primarily for performance, our to similar XX to prior a well Towable due million of segment. ongoing prior our of to by softening result Towable in demand normalized first period. impact Adjusted million, the points for as Revenues and basis the year. segment down $XXX.X XXX unit adjusted as volumes EBITDA dealer margin our the quarter, driven levels. I'll EBITDA but Now adjusted were year-over-year, of

decreased QX in fall on the against reinstated to we discussed pricing XX.X% ahead dealers our call, down traditional we their inflation increasing and inventories. were million, Backlog year of last $XXX when from are As prior focused programming QX. year comparing our in

growth to Turning revenue $XXX.X Motorhome year. quarter compared of first prior solid segment. million the to XX.X% our to delivered We

margin recall. pricing was Segment the actions chassis due X.X% offset fiscal Our year-over-year growth EBITDA increase from Adjusted was the than the the the points, of impact of in result XXXX, tied XX.X%, to production more basis prior year. $XX.X took adjusted the was million, negative primarily from chassis we inefficiencies down EBITDA an representing to which recall. XXX

adjusted Finally, towards the let's reflecting from and quarter, the were Marine and a Dealer year, strong in up EBITDA Barletta more revenues XX.X% result as Chris-Craft. and our XX the was than quarter Marine $XXX.X for points up first the the brands. than build last segment first last prior EBITDA to period were higher growth to higher the of space, prior XX.X%, million, segment. In for both year. our $XX.X compared across year to marine Adjusted turn XX.X% XX.X% inventories demand our continued levels basis segment backlogs the normalized year, margin Marine the million, strong of unit same for the was

now the Moving balance sheet. to

ratio $XXX.X X.Xx. outstanding debt-to-EBITDA of million of the representing As net end the approximately roughly we had a in debt, of quarter,

allow Our in to strategic our execute returning our us healthy has shareholders. to while allocation which continued investments drive to business capital balanced balance capital prioritizes sheet to growth strategy,

exciting a quarter For In a advanced our example, we to reached plans November, new number will future this growth that innovation develop portfolio. center. announced enable milestones of technology we across

capacity our demand pent-up to to our for those for products. meet continued expand also marine manufacturing the of businesses We help both

to As a the was comments. I back for back XX% some our fourth continued the to pay returning which XXXX. we With provide fiscal dividend Mike quarter, you. now these closing balance Mike, $X.XX as to quarter the capital always, call investments that, with will reminder shareholders per our to and quarterly during share turn of to to increased

of Thanks conditions flow, and community as market and giving very Day cash revenue, those appropriate XXXX unveiled strategic RV Investor near-term even We targets At gross we targets on and achievable share, fiscal levels. Bryan. distractions our month, margin, adjusted are much market net are yield, last the believe present. pontoon our free the EBITDA

segment XXXX, industry we RV contraction fiscal time in in XXXX be present the reach likely shipment calendar by will be do again there market that While will believe year we tailwinds year. the

order However, shipments in not is achieve a dramatic for in rebound targets. us assumption financial XXXX to RV dominant a our

We also cumulatively this growth initiatives operational investments continued during profitability clear intent stated profitable competitive strategic accretive complement a with period. excellence three-year inorganic drive and to that organic in have differentiation

our As anticipated the is slightly XXX,XXX it XXXX, forecast, updated pertains a mid-range to meantime, with projections, XXX,XXX estimate in previous of RV offered we shipment continuing engines. forecast we now sales. growth strategic October. our we in execute generally Association wholesale new XXX,XXX are calendar that our than In and to which recent RV the to priorities expectation This agree business create Industry invest the lower areas of will

market scaled Center, stated, strategic potential. within our expanding that experience, and imperative accelerate Innovation opportunities, balances adoption next-generation of products last differentiation. electrification our brands a applying for includes the Bryan intentional a both customer measured, to are announced but to month roadmap competitive for emerging lease technologies our marine This to that capacity be in our our we businesses. have all ATG execute superior we As our share which in dedicated will businesses signed We

Winnebago ahead, gains opportunity profitable long-term we Looking across Industries confident are has for share enhanced and for portfolio, our end dealers, our value growth that sustained customers, to employees leading and shareholders. significant market

open-up responsibility. commitment are the we want the our continuing to corporate to touch on to I we Before making questions, progress on line

recently by of named when Winnebago time Newsweek validated was one traction In for this first most Industries. honor responsible America's companies fact, we a were Magazine,

side, XXXX we for targets actively waste, energy XXXX. that and working product have set water, On we the the environmental on years and are lifecycle

live, and our access as the better the work passionately overall. engaged On outdoors to making as play-in and of the the are community health communities the employees well in side, we

compared XXXX initiatives. company to community shines these this on great fiscal organizations. our different recent off supporting doubling We start XXXX million, a philanthropy, we through actual targets are our down fiscal of of our giving and go heart to collecting non-profit $X.X fall, types are our XXX The campaign with

Lastly, corporate this of the our edition we responsibility just report. fourth released earlier week

to date, and good. will do team prepared you on and all priorities shows have season. turn a of concludes am the call do those substantive base our inspired safe most holiday this especially enthusiasm and That hope the commitment open by now and joyous and the We your up remarks morning. to over to our ambitions. frameworks, progress this will our publication I who Our report back aspirations well both the line achieve of specific operator our humbled levels, outlines questions. ESG and I to for

the with Baird. Thank Kennison question proceed. you. Craig [Operator W. our of Instructions] first Robert from comes Please And line

on Thanks RVIA morning. I'm you industry to next questions. and industry. where is will taking is XXXX what range for the retail Question good the the wondering for for order you hit in that finish year XXXX attainable? my think required at retail year and Hey, in this for think

Good morning, Craig. This is Mike.

which then of retail with and XXXX RVIA start similar From that move a the let's forecast in terms standpoint, XXXX wholesale a in year. will shipment to for So we back obviously very calendar very little left I'll particular it time that be has XXXX, to year. probably believe

Our slightly hope is it that above. is

to industry be over goal a to that take being with it if of that were little the retail year XXX,XXX I next out XXX,XXX a towable side of as can more for So the range on course would particularly year. the put range bit calendar XXXX today, in inventory the

conditions range in SSI that has probably front for yet is is thoughts the a going the I XXX,XXX weeks, are reported retail, XXXX completing to to we're we So that November. not be as period in Obviously that to on unit XXX,XXX retail say you we're and with few the us. again, our as see those left. here would obviously imagine play year in market of calendar that subject thinking updates, might out

have December. November We idea business and for decent into we're then weeks couple a our of a

– for retail. So in that XXX,XXX calendar RV range RV we're probably year XXXX XXX,XXX to

Mike. much looks And of just address weighs a for that your prices could consumer trending then like you a retail question up and How are you've is Thanks, on Great. more. affordability little XX% taken? or then pricing outlook? categories, around that the whether for it if on your your mix that And average both ASP selling versus action bit impact

to the about the favorably RV for you rental compares I'll would Craig, lifestyle of and longer not latter journeys. address of are to The that particularly first cars certainly the then tickets, affordability of as going the thinking give airplane lifestyle Hughes lot some economically trips certainly today. on fact, that those still other My is singular a ask the backwards. And part elements. in question thoughts forms We his Bryan be ASP hotels, inflation experiencing well. travel are cost or of message

the for are best brands, today that premium to parent the acquire take side certainly all arguably American So financing of and RV watching in higher of in great we're a consumers something cost means. of is branded very consumer compete in with and consumer those affordability loan from products. now continues five market market. the – the as in wise the both the are with to market them better, that trips rates out of prices the trip road a retail the for other interest of a but But favorably part positioned company sort the to terms And

watching are that We carefully.

time. the get reacting that the talk a spring into at on XXXX I handle where to the period how we'll more more I'm prices have as is something think we So consumer that about better sure we'll

Craig. and your side I question, on of Yes. the guess, ASP

you information, as out XX% the Towable driven. our If largely you pointed and look XX%, That's at are level Motorhome. for see both ASPs that segment up you'll

the increase. net those talked QX year's lot we've of we facing. inflation inflationary relatively we've and past, look bit much It's the commented at ASP We a in mix you a been did about at underneath But plays pressures of time. or not As a pricing in in largely price there's ahead mix that last if segments. smaller that role within as that

Thank helpful. you. Very

BMO. next line our question of comes with Please from proceed. the Tristan And Thomas

Hey, good morning.

morning, Good Tristan.

of just Craig's kind I follow-up to on wanted question.

is a Your dealer quite inventory many they from when to November [indiscernible] is channel. remove the year-over-year dealer up don't too as and think bit And well going reported. December I units

you prefer you little So wholesale think – retail, prefer do would a you came would maybe lighter? outpace bit or that wholesale in

would maybe we little reduced I That And answered, see to and have three morning, be a really business framework. pieces that moving Marine crystal Motorhome what the inventory our over condition. call of in four I and and market business. I the the that obviously Mercedes-Benz further present in fair mean here probably recall of on to the their in Good our OEMs the inventory months as dealers bit Yes. of Mike. anticipate continuing here question that I a it is, both This that lot to harm inventory position has the a in But sub-segments we time. both than and you're Bryan ball I There still would as segments is Tristan. the to because get know very where by aware, think say has won't of some different are the the place field depends well little Sprinter we it rare on interested that add have, stuck dealers mentioned and the to have to don't RV you the at next being side, RV be and towables situation course think with a

fiscal you So XXXX RV fiscal first quarter first dealer the compared the if end of Industries to of at XXXX. our end look Winnebago at inventory quarter our

necessarily position? right a has actually exceeded three, retail last side trailing grown all. at today not our are basis, towable our the turns over Our forward that meaningfully we higher. a on over in four growth on years. basis are the real has But And business question The on the is inventory

next over to what So lower. we little as spring three, four XXXX head there's we definitely the get we'll And here selling a feel the in season. field room inventory into happens see months towable bit the for

the Thank longer next in that do you Is Springer a on that? Okay. than is, you then going you of I question to just timeframe it to year. then think if offset recall, the what it And said And QX in calendar you. expected? remedy a are bit

Yes.

specific business has the of projected came of bit history product our So of the been of Mercedes-Benz in this XXXX resolution specific be week while in issue it time estimate a provided attention in QX that a resolution on to estimate that XXXX from moved what period. was October recall, you script is time. for we'd timeframe something has is Mercedes not facing want to exactly so late timeframe around. even whether resolution a best to or that our a still than for today the were the little notice, timeframe is here issue this the like and we that'll be. the implications took was the saying as our to March, But it at share what or around sometime Mercedes be something us I'm And to my little many whether the potential the understand And be January and resolution. challenge I don't the calendar really about for to other specifics not as that'll

retail systemic to OEM is see to the to wholesale OEM continue the business issue. a We biggest long-term material their a The quality ultimately the don't of chassis believe will frozen at customer shipments can whether operating So a comes market. we Mercedes OEMs retail point good continue of ourselves that do lost the and issue to From that to to deliver consumers Mercedes some back as and resolution. number view as we help. theirs smoothly And in for a being that have they concern what or standpoint, on pursue this like make impact with we'll back total get can work future. with while we to

to we transparent a So QX you, retail similar also certainly that that we've been once on QX means is in to there cannot QX. tell And is, that project issue depend as we this this be that financial largely and Tristan, the impact community resolved, impact, What morning. at the will environment morning the the time. QX for with what

Okay.

it ProMaster we're we're resolved. try So hope to going over course just kind and to everyone sound Chassis, stay the going transition of doesn't like to to it

we technically continue with Again, to the Yes. partner issue. Mercedes on

with our that products financial dealers them resolution work program are to but this a in of to consumers details to still the is size to try process they work the ourselves ultimately their provide other or impact that the retail can continue dealers our final to interested similar and We time. at platforms, in

it. Got Okay. Thanks so much.

Thanks.

One you. of Thank line Scott moment It proceed. the comes MKM next Please from for please. question, with our Stember Partners.

my questions everyone, morning, thanks well. for Good taking as and

Good morning, Scott.

on to as the you guys feeling one that to notably Mike, you have discount field, and the Design? were about XXXX process. bit are little far and any towables normal if are for headwinds talking expand in a of maybe Could more the that bigger Grand whole right-sizing is you on deal models need or as than inventories

two thank parts. my into down question. Scott, for your you I'll answer break Yes.

then and with start and retail; the latter wholesale. First, I'll wholesale, second,

and RV we used to we those benefits be with at And the Our fall structure fall the programs a timeframe house the the in in provided programs watching news pre-pandemic through not old stated product retail X/X inventories, segment rest as on November not businesses and this inventory what Grand terms fall or first to pretty branded slow and have our perspective on the dealers. to is, open as market ship time. Winnebago you both have watch to QX that abnormally probably generally retail admitted the of September/October time segment the down. the of two significant products. did XX% the of standpoint, would our so programs of aging And similar healthy we we’re the we've the piles throughout of of that excess in ample, in came XXXX the the to product to historical was the our market were inventory we The to is Design to certainly businesses, consider From do at We retail at I from Towables are our Towables steep started carefully. a dealers stuck this But to subsequently, move discounts in market. inventory good XXXX. to healthy that when are

the anxiety QX programs include inventory to the But it is uncertain OEMs with inventory inventory We each carefully. the monitoring here sense our at if retail work time, overly and aging here and not this ability time. through have brackets that a at inventory age imagined, deal dealers at have of aging determines did excessive. support Towable inventory can the But and major on then we the our of aging have we certainly our turn conditions, whether sit not Towables any that we businesses. XXXX with different excessive this I then for problem. have historical a aging standpoint, look that not over when in that But are And as the from businesses with significant conditions economic you would reporting field. the certainly today, into be to field. we'll not towables It in in a in we of retail I do from course they dealers would particular as could say tell segment is

and talk are particularly just standpoint? whether in a have House you Open but on to like, what dealers know Can from And order wasn't QX, out we production lots. XXXX lot activity about picked Got has place, that also product XXXX have of that regarding their going the looking are some there really we to towables a took it. on up coming sequentially, orders,

And make our in we those varies in rational and businesses, number So the our which them sure order with XX the adjusting activity, we around regularly other they conditions a a a and would like the RV conservative space which to with reasonable the backlog cognizant by the questions, as taking activity would It Marine to of certainly interest pattern. category. projected dealers order standpoint, be of their what of Order that rates, not two the RV and this general attempt than ordering you by as has here at And retail to as by level. time, remained expected. healthy markets, have RV we on remains has a reasonable. to production days. are Towables lower it in planning last cleanse call be Motorhome they're are From I they inflation, in years continue couple purposes. rising as Towable see The and dealers again, the ordering last difference a for sitting inflation are Motorhome we seen integrity dealers, conditions on. the very can Marine still what mean economic is, meaningful probably inventory in And Scott,

our of our rightsizing So discuss wholesale with can we to really production of schedules that don't we or share in. the almost conditions market all if I tell channel current production specific that information planning appetite partners we're you continue on and for to just the quarters and future have. businesses the that hourly, daily, our brands, not

make accordingly acting that list others, future. in Towable are the aggressively all top to of more our we overproduce we that sure do in not businesses. So some Certainly, of the RV at than

I in. Got just it. last one If could one slip

units value amount. same Looking at absolute the are it down backlog, total in the about looks like

of assume in is fair what it is is on market So ordered right on pricing being going the the to what's reflecting the now? that that realities

opportunity, – a this then to historically, year that we into seeing relates and in we year you got And inflation the Certainly, seen tell model XXXX and and how good it Scott, change. and at pricing. preferably a would not as pricing conditions adjusted inflation. we're that about with our one I time is talk or XXXX rapid Yes. unexpected to

a were timing increases to As inflation year been you're that a element all model as of take has there's try of price to And of Hughes forced that to times, to in you're the behind to a keep know, up. or during many Bryan you sort whether as multiple ahead we facing. order explained

our outside it moderated in overall, of from pretty other of very inflation our year our inflation moderate which has meaningful we're the I still deflationary, would XXXX pricing the seeing seeing and where categories, it motorized are actions model in to business now. degree. to changes We today inflation generally is call of most but is not moderate right a XXXX. our sequentially most our chassis, significant with Subsequently, exception

Our of change. businesses, recently year share generally for this don't pricing We about increases felt our a what reasons model across need call the not the here the beyond behaviors. they've priced and information have board ton competitive to to price have above on at take

would the so you won't But around particularly continue anything context RVs on to sort our framed Towable be that in tell to program I House. took the have And fall I we of programs, businesses wholesale planned. Open comment

it. so Got much. Thanks

Instructions] [Operator it Swartz Truist. And comes from Please ahead. you. go Michael with Thank

morning. Hey, guys. Good

times think to talk – Just a seasonality. you're and wanted kind said normal about to number Towable that seeing margins, return of you've I of a

in the So I in understand margins. year-over-year the to I'm guess quarter, trying maybe change just

of you think I talk gap. But pieces benefited and about maybe moving kind cost. price last the bridging from that year

I then was point, sequentially think contraction think And there that's quarters, over about couple XXX basis XXX the how that to year-over-year? basis or maybe whether of point next year-over-year? a

on. last can ahead Yes. Bryan. is and one that upfront would really Good back Mike little was on. our that margins pricing This lower the towables in address we strong XX% of had relative report had at outlier inflation. add I'll referenced the we Mike. anticipated certainly time, typical to probably was comments we seasonal for go of excess more that first QX an a to year And EBITDA I'd QX, morning, in

certainly using when explains year. take the reductions difference. and was that were That deleverage faced the equation if something QX top in you the with that you're prior bulk cost elevated of based to On of the that with that just variable the topline So we XX% that, XX% structure.

to that that we was So had then deleverage impact relative we we've the rest inflationary of And largely, talked little the about. pricing a because that probably timing year-over-year would experience.

But pretty well. So a line in other those for if margin end is into the also you our sequentially each result similar with more back and are EBITDA the more towables as typical in EBITDA history margin QX two to look QX primary drivers. and

pre-COVID just maybe look saw flow. about maybe to similar I clarify, just to mean, mean going think to would think Is maybe but forward, way is way it? quarter-to-quarter that to not what And progression magnitude, about I we Okay. the just in that the the margin terms of

our That's expectation, current Mike.

eye dealer was retail how obviously and is keeping performing earlier, be to very alluding to on how as aging. performs close we're inventory including a Mike well, going As

And follow so EBITDA quarter-by-quarter or our current similar will expectation expectation, though, at seasonality is margin. that our a That's low currently.

Okay. That's you. Thank great.

and just I understand, quarter, a just Another modeled. in Marine question Street a SG&A little what was in investment come and the had on Was percentage elevated of outperforming Towable? modeled, trying related think maybe in related cost the there Motorized what expense? people most in to I'm margins, a did sales just had as or that above that quarter the mix, i.e., segment Or factor of something SG&A I

both. absolutely Yes,

the greater have say to Motorhome SG&A a than businesses fixed fair it's our towables. in that general component think does I

possible as investments on the do And know out, in to less those things those mix continue nature. his the most in Mike so managing then that that did long-term. that for obviously, business to you doing strategic strategic do important, we to make have we be SG&A would as hold we are on thing while to are dynamic certainly right there. also best our on call And aggressively as comments, But going a

I have you would points in my answer that the two hit your provided within main So question. I think

Okay. Great. Thanks a lot.

Fred proceed. Instructions] [Operator you. Wightman Research. It Please comes from with Thank Wolfe

guys offset question. to but you is inputs, some to of favorable. of, to follow-up those that some the to Hey how that? the for wanted the guess And the to have conversations. potentially I I rising guess, dealer? on treat guys. Thanks Would you I of through just ASP Or been that move plan would conceptually, be pass the bigger material to sort consumer look costs pricing

Mike. and number of forward-looking are always times, respect we on a willing Hopefully, pricing business pricing strategies that to that. is maintained elements. do we pay generally is to But intentions. some or I'll pricing we cost-plus for. that market-based business that And choose based pricing innovation a market bring set that are to through market-based we on this maybe to at differentiation so. we years the and competitors consumers that long-term, Again, of Fred, respond our not are a the we've share don't ultimately

contemplating build within also in those just context retail our and conditions. elements means, our but be not So and that certainly, what costs, if competitors of we our as COGS, would we were materials to see significant deflationary those well of what might consider the

or So variety that future. certainly pricing of affects can businesses our any but we are a morning lack you of won't share specifically our the how scenarios talking intentions, this depending assured be about on business inflation in

candidly right that the can dilution that continue we to So sustainable in is create industries to the in think as profitable market we profitability. I argue, share the We OEMs of sweet is well, we we also other. be and one for our always compete who reinvest to to and our we ambition are. the balance find we so most focused, spot want drive in that can But strength. future of share on overly one market where to negative try We're neither would

way you that posted Fair adjusted assume drag there, I chassis but impact could guys up chassis. guys recall gave of motorized enough. too, margin that us in the category quarter? topline. And size us? you margin the the Is still despite impact frame sort to mean a for a you in on EBITDA the the there there's the baked double-digit in I

Go ahead, Bryan.

model chassis sorry. by I'm we to or not by there. Yes, disclose prefer

as probably you reasons, competitive for So appreciate. can

Thanks. Okay. Fair enough.

Instructions] Jefferies. of Jordan proceed. Bret [Operator you. It comes from with the Thank line Please

morning, Good guys. Hey.

Good morning, Bret.

of in availability last I first up? On power the is opening guess, going mean, the months. that calendar. the And a is side, chain? half a something supply marine has I obviously, could marine you issue Is bit talk see XX a better to about little that big been

one of as also From the of the standpoint, the chain a business. most but one seen the side, of of was constraints But supply probably the last categories. that years, the certainly couple categories issues over engine experienced on Bret, important, we've across some you're side aware, actual marine different

marine half, and motor/engine businesses into a from of most our a And year conscious Over the that's the the decision to a year, reasons. we put Mercury very last on a made for basket. of standpoint eggs number

with that were supply our foremost, we business. the disruptive very chain and First primary had Mercury's to challenges competitor

think about of pace really talking has we competition, continue and Mercury Secondly, standpoint set category innovation excellent done engine the really particularly here, on and versus that's an I'm outboards, others. candidly job the from the to and technology engines an outboard

Mercury as a number seen reasons. to different improve for a have supplier continue of We

be we many are those continue the level it's year, with calendar confidence brand's from the and enter consumers as product a just it very take retail. me about terms reaction the choices the have to the and to in is the pleased relative have an year chain market, shipments pleased higher though of well and retail rhythm market how opportunity the going of we we with particularly engines other again compared of Marine supply related that profitability to ago, was to as around Barletta's give as us performing absorb a Obviously, question segment, we'll XX, from well. how to we state pontoon much is as to so get half. components I in does wholesale But been and Barletta XXXX, more growth, to willing they we that that now than our the year And line in past stable to acquired Bryan have months XX business that your

step came portfolio. is think light years And years four And the also prior last closer and but first business, the and balance of terms has diversify fiscal XX% hard probably So was quarter versus is entire profitability segment. in That in diversification we've was a our our I from to the profitability off market resilience where having that business of quarters our across quarter our work done of forward and the in portfolio. I strategic paid of in about this continue prior three, Marine intent quarter underestimate execution a revenues the XX%. And things outsiders this solid to of think our our meaningful our the to another terms two around conditions.

Great. you then if the recession? a Do RVIA housekeeping. Okay. includes know forecast And quick

at recession range. I I talk the they what Bret, aligned period. know think midpoint is this somebody on that. a We generally have during you'd produce RVIA to we to to chose release here committee, particular in statistics any tell number representation But connected the the probably XXX we year of sort on but I hard to you have calendar can the not XXXX is U.S. for economy.

Thank Great. you. Okay.

you. with proceed. line Thank Altobello [Operator Raymond Please of From the Joe James. Instructions]

Good Hey, Thanks. guys. morning.

X,XXX you Just expect back second. about fill It added QX. going here you like looks that How units the to in the marine long here side into would fiscal for channel XXXX? in extend a opportunity pipeline to

This morning. Mike. good is Joe,

answering of And watching why. overall around to won't to in be this factors conditions macro call, I you explain and answer, on able be give number So there's the question. are Certainly, going result I'll the things marine industry we're which ultimately a carefully. a that precise

of the marine that than industry industry the building We are to the expect, categories. industry have five-year-old as segment the are that marine make marine similar in facing. not consumers like Towable for Barletta as immune question the is RV has been is it the year, last specifically. any across not number industry in the late and on do business. pontoons, been that than a sub-segments healthier trending positive of nor do the your much side. of to pressures categories a following. Barletta different me RV some But are healthier While the answer would we macroeconomic its Inventory certain little a elements, believe the And believe, you of difficult which is

There the of that are country we of not all markets in Barletta we new have have do have a presence the were our open around now. when presence We prioritize dealers can presence they And have we dozens Barletta that up opposed to put existing very chain believe documented brand dealers. not partly the that a believe as a markets in. have that still the setting today we in brand we because constraints can real in the supply that

difficult we of timing introducing us the to grown about yet has on only your Barletta a player are question we that market, brands The for underneath existing go Barletta is the that's other to or umbrella. Today, element lines lines five put addressable with business. pontoon new three business only to the and XX% after two top

which premium which invested called also end called stated, adding for base the reserve, ongoing. future. new line introduced for high we have a priced And [ARIA]. the capacity both And as are We lower lower-priced dealer the still been are the a the is adding of that to on brand, we in expansion line we have

a in little So the well we'll as swim we momentum, believe because a Barletta, their the marine bit and have dealer against expansion way normalizes tide as of their very product-wise do that expansion. industry disciplined can share their this market line to and

disciplined, And so though. we're going to be very

We to different our be obviously, in but overbuild you'll to that watch, than is have what overstock, see sure. other for timing to temptation and the going segments

And you earlier that. That's dealer X.Xx. helpful, RVs. like moving about turns, to then your mentioned appreciate looks Mike. I this over It maybe

fair that that assessment? Xx about stay post-COVID. Xx to running X.Xx expect within to that sounds you in running like here You're a Xx pre-COVID, Is range, It about XXXX.

will got margins have that that on dealers for I try they some at really thought in market. the degree, the of run for so the low if Motorhome X.X to a those I, was dealers believe right at be to industry some Joe, RV we But we X to you And higher trailing the by your future. do run vary the dependent, sort to frenetic they to that versus their half numbers the and of would the business know, overall. So I try on if used to basis, does time now is that probably capital. X.X time are retail you would somewhere past, turn range It came and side running a out felt segment, as think period great to going we the to as But and working have Towable. tell retail look that inspired at pandemic volatility on Bryan of you in of some

planning to sure half when today. half when turn fulfill expect production still we chaotic has mean, about it's the But the it able turns very turn and a yes, dust have adjust So higher settled I to be processes we are I'm yet. adequately dealers our a settles to not higher.

Great. Okay. Thank guys. you,

Citi. the James Thank from of you. [Operator Instructions] Hardiman with go Please line comes It ahead.

Hey, Thanks good for morning. here. fitting me in

comments really wholesale So appreciate the on both retail. and

place we is I going to again? of are the think my for as normalizes Where of there, wholesale you that that to look as to bottom you agrees if out the last XXXX. sort versus couple think a grow think the fiscal stage And everybody year right? for in at materially enough of next that you going question lines play healthy about the But sets able earnings grow industry you to, I the top obviously, inventories for XXXX? do is, pieces there's How point be expect, this we of and way XXXX of and retail the fiscal lot you down years. ASPs as guess a ultimately, be to promotional finish all that. power you'll sort we're industry thinking the environment, do moving exit are again,

morning. of James, good first you the Thank question. So for all,

be a out We Investor grow. both As net to business largely they a products could business. I see than will absolutely factors; very that Day, organic market ambitions or organic one, share it The as know, mentioned ago, tied as through to certainly interesting of to overall growth we levels RV because growth timing, sales overall and have today. would be well-considered The I opportunities new do to you of timing create our inorganic continue inorganic anything. and be you to I saw have smart, as as how to month path to on some hard of for Barletta. it at the higher put on predict. conditions; James, our will and to market plays we how those in combination be our and are still targets well. so growth at know we will out both second, ability the believe The growth is growth, will side, innovation, the two much say

those stated a higher of So market steady to reach year, during will fiscal we've a next we element years. have And XXXX of that presentation. for some been factors, make ambitions, here do need of end order neutral our the turning bit variety headwind share we the progress the little Investor three at road. back point certainly That as as but anticipate of Day positive by in over down to we our late has

just with about that well, I five well comment financially of And that to want Bryan's a careful who very we to we healthy we So XX investments like paranoid in can't of have when although inorganic to years down on status. capability very some leadership, match look we But happen. can the a strategically make as three company make But we're as structured we're the way. that some road. to to sort sure stay

see happen you'll that as well. so And

of that industry of this maybe that. I And Obviously, product, sort as the late. out little fiscal maybe know points there, of is decline there maybe helpful. a outgrow of share for out to industry? big a to do has this whole big market stand last number the that opportunity of part is Maybe a to your an in that? year growth stalled guess algorithm clearing Tier better move and years under the That's a way the And here we an this share part made X environment. now. That's put sort update. or a of I of of bit one market of you where sort with been just is beyond

No. Yes.

on the share we who James, we RVs to Our spaces. been reasonable share the take been questions the of also the, some of continue come with over earlier. Bs. consumers but what gains our obviously the were are near-term, Towable affordability price other raised very we've Class to the field, we've that OEM. is are as side, competition the conscious. premium pressure in the market market that for with seen seeing inventory a for has with Most cited, market two second expectations on also And very and businesses RV time, you in In third-tier

for been now. XX% plans and end brands brands years then to consumers businesses, XX% both Industries on of more competitors each to most have degree was be are with our hard Winnebago our candidly, that in they hold to other and plans, make candidly RV that going and to relevant, share when that for not distribution But plans of to it years predicting our and Marine hopefully, ago the engaged We have were and obviously, dealers our well. more the product the our appealing to marketing digital side, as category

our doing past the would candidly, track. the to share pricing a than to because is the lot So pass ability again, here that talk we watch better to last were dollar unit of able in difficult that suggest more about dollar year our market increases very share don't do. it's carefully. in We we our through probably I recent because share share

it's of market profitability again, balance continue So a share pursue. and we that to

predict here. Thanks but to appreciate Got anything, we're it. luck good I Obviously, macro candor if a much, the time the now it's getting. guys. difficult given uncertainty,

of comes Northcoast the John It Healy Instructions] Research. [Operator line proceed. you. Please Thank from with

taking and get my Wanted your question. big you, Thank to Mike. just thoughts, thanks for picture

imply down that that or talked XXX industry. is doesn't for that that look you that lower of look To your shipment range. I so of number, end take XXX a worked when to retail XXXX, the at me, in of if comments the the inventory ton Just at there's you about

kind to love those behind would elevated your numbers thought XXXX? shake kind logic. the And I of to just understand of I'm process. out? So that trying logic kind some somewhat goes of if the of going into Are of understand still just kind we

John. emanates RV standpoint. been of look on at As really around be actual morning, way. look from Motorhome it Towable key And as is into a the retail. Good components. we to this inventory retail. competitive business healthy could we've break like retail view example, on on Class mentioned Class year we We not a the see bottom-up We it point been RV a some have to before, A will from we be would shipment during we trailers believe certain down at Class as certain I've because many I A, fifth climb. We parts travel on and the of under logic there pressure, that times And the haven't our stable dwelled this and next an call. chain would Yes. supply which relatively That say challenges wheels categories of B over C. able be environment persists, as some share in

As that elements field that on of to a to itself, our future raise choice inventory relieves work sub-segment. in the we some continue have with certain dealers to

Towable rise RV as the particularly the are probably actually to RV would where mainstream places, those. various can to the where less That the introduced believe segments is industry we by of dealers inventory believe in grows, then B prefer market. business around There we products are As spots have of field electric offset sort carefully. Class

and a macro our the reminder plays this moving and it pieces that that's see there's at give But guess how various we numbers to we'll them, time. you So just always are best out.

– capital on XX that or or just look When would months buyback? XXX,XXX the retail then look question. environment, scale look a for make guys And at at you kind next you back so. environment enough that you the you given at comfortable that allocation you those of comfortable things for Or is acquisitions retail Understood. do environment does

take to that. I'll ask Bryan

Great I'll about have it's dynamic throughout be the talking call. a as stated question. going to Well, I environment reiterate we've been before, it. and

like that our X.Xx given of liquidity throughout focus in of which on our going this And we sufficient, our Organically we'll returning then how the Our shareholders. and higher that the priorities inorganically, change to is environment, cash terms uncertainty target forward to a to of ratio on it's all particularly growth. We're the view capital sure make about really and and at we're range don't we've times call of environment. allocation to as allocate. level dependent where there's X.Xx talked to environment leverage in continue the

So a We share did that's this reasons. up make. back the for a cash that XX% think on repurchases held pay comments quarter. that, We was I in dividend primary couple of would that we

And increases that. is cash talked working impacted a recall as second, seasonally is relatively driven First, disruptions then historically flow than lower QX it And by to our and year exception continued was this we the generating QX year. by specifically. last strong Mercedes-Benz was cash But about quarter. low was capital free historically, supply

our that repurchases QX So generated flow our free was in QX in share decisions influence cash certainly something here. around

So I it that further. capital to to relates anything would Mike, you think it as you that's the allocation. provide context I I'll turn if back to want add And

comments. further No

a have Thank season. and holiday you, guys, great

Thank you, John.

Thank Rolle line you. Come with D.A. Instructions] Brandon proceed. from [Operator from the Davidson. Please

here. and questions you me taking Thank fitting my for in

Just last step for the Do and earlier exception XXXX, XQ Towable seems have margin a quickly there? the up segments. talked progression call. about on you margins, think had like there's bottomed there's Motorhome during year like of the I you with it in the margins think seems – in margins Historically,

made Motorhome quarters in over Yes. that we've how the margin. feel is we've maintain our about that current past We talked double-digit Brandon, expectation increases that time, good business about the to and EBITDA to

margin we've And so last and like been to maintain business. were double-digit to seeing the that now, you in that we're several over Motorhome can that more able even over the we time times accomplish quarters challenged EBITDA what see able in now,

So seen most three now. the last notable change over we've the years that's where

our about that in what earlier really with I side, expectations. with historically line talked is the in our we've in On line the and Towables low seasonally seen here expectation that QX

performing is in story saw bright as to portfolio. QX, is you well the marine marine certainly very a to side So the margin relative

liking seeing And the we're we in we had what expected line with to into see marine that in when Barletta so and everything portfolio. we're the really brought

anticipated. with line in we out played our has and what expectations that So

So a good there. story

Great. And last one just one.

levels. side, right is data just the provided, been is Motorhome Thanks. how of of being filling about the expected? like the do channel quicker – feel now? you implied demand versus is from up about where XX% you might than looks On It reasonable. orders orders have down reflective Or you XXXX Kind talked had that kind of

ago. on Mike. are this dealers Yes, levels. new world I to reasonable term on the than in close the month a tell of us. of third is Winnebago-branded is Again, a certainly, inventory paying would in chassis was inventory I different November, their of we around year chassis. the attention in the on overall Brandon, is Mercedes orders as our you And light certainly guess an Almost that field no got Motorhomes Mercedes example. volatility

to. And essentially that's so the take something it's they know forward to hard see when orders really that dealers that, can't

chaotic a yes, is Marine would less these to I rank in I orders, way mean, dealer, a But small dealer variety Motorhome that at that from positive this So order a it of the categories. the orders relative again, Towable is large those. is orders, looking in way positive

get So we'll selling into season. happens dealers see as retail the what

holidays Florida third the January. of I including four show next three, the SuperShow in shows, up That over here are after a months. down the We RV the with in coming begins number think of different Tampa, on earnest season week

the about year will next the we in orders rest XX, and subsequently, And is our and definitely to prospects XXXX the so turn calendar year. XXXX the we'll activity many learn I for whatever think make a over XX the lot of respond retail of ways days fiscal calendar as

so much. Great. Thank you

Thanks.

of conference. host. call this over turn like today's you. the to portion concludes back the our to Q&A I'd And Thank

Thank to year. holiday the today. and we you. you, team, happy season wish look call a everyone, From new joining Industries you in connecting forward our and families for your Winnebago the Thank

And call. you, now you thank participating, Thank and may gentlemen. you and today's ladies concludes disconnect. This for