Winnebago Industries (WGO) 20 Jun 242024 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the Q3 fiscal 2024 Winnebago Industries Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Ray Posadas, Vice President, Investor Relations and Market Intelligence.

Thank you, Josh. thank third joining quarter and our to everyone, XXXX fiscal earnings morning, you us for discuss Good results. be of This on call call replay our live our will the website at later is investor.wgo.net, and being today. available on broadcast website the release quarter results with to and was third this earlier website morning. our news issued posted The our website note the earnings Investor with is remarks prepared on that slide the along Results. Please also section Relations under our of our deck that Quarterly available follows

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me are certain and conference operations statements Let that statements call number risks regarding differ company company's results may to forward-looking in encourage involve inherently cause actual today's read. you made during from could materially our beyond forward-looking we the of The and remind factors uncertain statements considered number SEC you laws. Winnebago its under of and a are are to control, you statements. of that a cautions these Industries securities be These factors, which identified filings, which many

refer the available today's financial reconciliation the In addition, the and measures press management of non-GAAP and to measures earnings release. our GAAP call, measures GAAP in comparable to are non-GAAP on will

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Winnebago conclude remarks President President call and then questions. Hughes, discuss prepared be financial strategic Bryan our an will me your to will of Officer. with Happe, and overview Mike results and Chief Joining take will performance Bryan a QX the our happy Officer Mike of on business Financial management are our level. with outlook, Vice Michael at Industries; and Chief today's the and Executive Senior will begin

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demand into fourth financial economic for to since remained joining our both we retail and that move thanks consumers and fiscal RV outdoor with year. fiscal third everyone, quarter earnings sluggish conditions inconsistent the X weeks, our morning, Good are the In evidence recreation quarter for industry discuss as call, limited us has results. our of QX Ray. Thanks, 'XX improving

recreation While consumers health this undoubtedly the key discipline, outdoor a engagement by caution term. growth of business the near-term environment is long for necessitates and of our secular future driver

mind, X I frame our to discussion. this to will in that morning's With points investors emphasize early

strong term, long challenging the stronger. markets make over companies even First,

maintaining resilient profitability relative sales on support margins discipline through unwavering. durable and focus production Our competitors and is to intentional

brands customers we Our all short choices to make collaborative total matter across be our term long-term centers differentiation, share operating greatly, essence, brand in the to best the product model and our functional excellence profitability. relevant our with in sustainable of aftermarket the ensures Maintaining support and but end are must valued premium dealers commitment interest. and balanced

composition expect inventory continue and beyond. while RV fiscal field softness year-over-year we Marine basis QX are markets in for our XXXX is an improvement seeing Second, these in to encouraging sign in in segments, we Motorhome gradual a the calendar on industry and

balance our shareholders balanced healthy and our our and execute cash return repurchases. share enable allocation priorities, cash strong capital flows to strategy continues sheet to dividends maintaining a select to through Third, that growth while us on

us call have the communicated prior poised years a to in in strengths mid-cycle Our financial earnings successfully cultural, strategic and ahead. pursue the targets

pockets Turning experience to macroeconomic elevated continue of third softness In now results. effects rates interest caused quarter, to our the the and by persistent we of inflation.

and retail with to this capacity, focus output business on costs highly aligned strategic are and in wholesale patterns order inventory ensuring levels. advantage that cost we market a Our as environment variable remains and model continue

$X.XX earnings in the quarter sequentially million. up $XXX the XXXX, of same Third per Marine million, EBITDA down were XX.X% by our but period for RV quarter from net and from supported consolidated adjusted Adjusted $XX XX.X% QX, revenue Towable was with share segments.

C which Class that business, introduction the exceptionally of ending to are with a entrance While into in our brand, aluminum in our we Barletta trailing powerful new performance performance, contributor the of our did X.X% announce quarter Lineage pleased April. XX-month the segment. Meanwhile, its officially brand's pontoons RV the share increased motorized marking period financial to product, Grand inaugural we third not for Marine Design's of U.S.

importantly, performance Barletta double-digit zone, More retail. running low that increased percentage in X-month the trailing share X- and signaling at for momentum has brand

on RV Turning to industry recent trends X. Slide

the have cautious as of third into the orders a been promotional remain head our level selling dealers activity in supports compared anticipated, last As a we on The higher rightsized from Association products data recent year. largely summer view season. resulting standpoint Towable quantity RV RV with to in inventories to same quarter, period some Industry respect that the

year-to-date model the total We industry, shipments calendar XX.X% in dealers shipments time of to portion contrast, of to wholesale anticipated. Based occurring though, year up that levels. last the and on the order XXXX. inventory Towable the date, year-to-date in ongoing industry's economic industry rapidly more industry. April industry pace. the basis the XX.X% reduced while ahead of through further Motorhome additional XX.X% and a industry were work is more as the also calendar totaled expect softness and year. for not X.X% Motorhome do April But prior the XXX,XXX in than terms across reduce backlogs the stakeholders RV wholesale RV shipments destocking still remainder 'XX. year's has recovery shipments April results we across of is as retail little growth in needed, of industry inventory first a to XXXX The year-over-year work units, bringing RVs in By down and category believe from on X were XX.X% is industry months RV from down encouraging, by

calendar to our below year have RV RV wholesale shipment the a of As XXXX slightly for of most revised forecast a industry estimate. midpoint result, the Industry units, we recent XXX,XXX Association's to range XXX,XXX

estimate Our for period XXXX is XXX,XXX latest calendar around same retail the units.

our X Slide share and market to performance. Moving recent RV

XX.X%, in is totaled XX, ended the down it XX the period from April points which For trailing XXXX. basis months same XX

see this channel would we see, future. in to integrity that is retail important due in to what share the commitment relationships part hold not in loss pricing is like healthy we ideally our and to to models wholesale While

we worked increase RV a opening being environment, to of seeing share strongly is portfolio our such is lineups, in not ours. premium point our where While slight affordability emphasized, strength have be an for so the in SKUs loss intently unexpected to as price

more will and pricing. We are this pipeline future innovative market move new products stable our trend confident upward reverse years with in an to cyclical in

at segment Looking Slide X. Marine on the

customers, Barletta with as our customers. is focused our team The customer to building and premium lasting channel X XX% continue needs top target market. its the for reach X for their a Our exceptional our well remaining over passionately pontoons to results cultivating on experience mid-cycle best relationships share Barletta superior the partners position time. in to The products Barletta on about deliver or serving end an network and innovative and dealer is path focused

customer new on M. particularly partner Grand across its to recent the country quality exciting Grand market in name dealers new Class us service X. RV this Turning The product Lineage the reflects C inception Design its first to the April, the In Grand highlights brand a with What Slide since is Series to base. the to in leading embodied Design opportunity to Design for history, XXXX. is its introduced motorized and has excellence

Grand an in Saturday, XXnd Lineage, and Eastern. celebrate on area the see in launch you The XX:XX we to Ultimate June new be hosting from invite down the and of will the Park City's Lineage we X:XX York Glamping Pop-up this the a.m. p.m. come are motorized the To New to in-person. new event, of Design's at display RV those of Bryant terrific

on deliveries this Most will for As I track take the our the stocking in fiscal initial year. QX Lineage limited on shipments Lineage noted product, are begin to place of the call, late XXXX quarter. of however,

address the fifth-wheel Before want case, over been excessive Solitude across review review, on are industry misinformation customers our performed has continue our that exceed it meet resolve products to financial ensure supplier, thorough In processes disseminated regarding a collaborating Momentum and small been directly for have products. with Design dealers network social a and and/or to also each third-party frame its media directly product flex Grand the that team large the turning experts percentage the of engineering industry, directly frame I including our and concerns. Bryan any a has to reported working structural of to The firm team industry and impacted with standards. to

commitment Our to every customers we stand continue product to build. is behind we absolute, and

all frame to warranty To we on years Design X recently reinforce products. Grand extended that our commitment,

original purchase to frame retroactively Our on warranty owners the with structural period These year X-year warranties from model and continue warranty the original will date. purchase are transferable warranty, base honored new of based warranty subsequent date X-year the be to during X-year XXXX. beginning also

day. These values how people interactions Industries, to values hand our best. over every Winnebago the core X Hughes. outdoor in first guide with recreation put across Do thing, call the I'll guide Importantly, premium operate stakeholders. With the the and all right be and now be we that, trusted to leader vision support Bryan

Thanks, Mike, and good morning, everyone.

earnings prepared my of our starting release our on detailed Slide refer key of for supplement in I on focus reminder, to will results. Please and the drivers remarks, a As earnings performance. overview our X, key documents financial a

effect marketplace conditions. Gross to well XX%, the segment segment preference units, in consolidated challenging deleveraging with customers a production competitive reflected amid delivered primarily revenue lower-priced in aggressively market quarter well as pricing as Industries with of efficiency RV RV we the a elevated the margin challenges. mix third in Marine and shift retail decrease as sales year-over-year discounts The net lower our operational Winnebago lower product and primarily as manage quarter. volumes a unit was Towable solid as in demonstrating reflecting for third continue Motorhome for

although range addressing comparing and are initiatives, last to has historical production deferral product flex in We consolidation certain year's rates. favorable the through third CapEx challenges projects. year-over-year those Warranty cost returned up including line expense, expense quarter, a days, against containment of of

free not shown QX. while which call generate on million $XX.X out, and flow, fiscal of slide, to continue a in but cash totaled robust Lastly this we worthy

repurchases, During year-to-date million total the $XX of quarter, to $XX we share the executed million. bringing

down efficiency X.X% related offset or reduction unit through performance was work with to in product. year, Towable from to consolidation segment, reflecting up Slide business mix. challenges was of margin, an last production partially XX.X% ramp-up were year the of quarter new Segment in increase up of partly average our second reflecting EBITDA RV XX. as XXX Towable per basis the in adjusted starting QX from product points versus a price volume, plant Winnebago-branded XX% on XXXX selling prior Turning a sequentially. by by unit the of Revenue or we and operational Revenues

of sales. QX there RV fiscal warranty broadly, a remains XXXX. from as comp Towable difficult for lower benefiting to XXXX more expressed prior was average percentage quarter Fiscal segment favorable year the for expense than segment And last with the third a warranty expense warranty of rates

with including we Importantly, do meaningfully percent associated flex our warranty the expect introduced of by as expense, and the not cost Grand frame expense issues to sales. the excess changes Design warranty warranty a recently elevated expense

experienced Towable profitability or to headwinds the through year, XXXX. discounts trends. RV quarter the level of was third had to profitability disciplined retail these in broadly, industry we While production direct to its from fiscal of XX.X% Towable impact prior down fiscal the way demand. we compared the in allowances demand in backlog result highly in segment reflecting current and of a a quarter trough in the current industry XXXX of as the decrease and utilization favorable third the our This is dollars moves as RV

and XX. and strict Revenues we by elevated to during stubbornly prior and were This of higher rates segment lending, continue partners retail consumer as unit season. RV soft interest down May and their With chassis credit our costs. and strengthen health the wholesale affecting to shipments partially allowances inventory. an increases closely increased the the was price offset from lower Slide volume selling remain Motorhome motorized to both with standards related level for year on discounts of the dealer to Turning work XX.X% June

of higher in points efficiency operational in year. Motorized XX.X% materialize. margin challenges, Sequentially, reflected adjusted failed leverage and decreased and the as deleverage down of strengthening was retail Backlog to Motorhome were The margins cost year. containment QX May efforts. segment to or allowances last basis market the offset volume to XX.X% by compared prior in from Segment basis and due anticipated and EBITDA the partially down April XXX variance the dollars to points RV XXX discounts

segment. upcoming for maintain capacity this in and expect We to dealer discipline retail demand heavy inventory considering in a utilization tepid fourth our levels quarter,

Marine to XX. Moving on our segment Slide

third the and with higher and retail quarter relative network. conditions, demand by a inventory. down year. economic These year be down current the preferences driven to dealer continue cautious cost were XX.X% line prior in in our Given revenues in Inventory to quarter levels interest from shipments soft considering dealer the to the prior factors compared carrying be elevated to of rates caused expectations, the

revenue mix product net was addition, toward impacted In a lower-priced offering. in product by shift

the was example, versus adjusted ARIA Barletta's down margin prior efforts. of due year. deleverage, period. the primarily points the EBITDA year. Backlog For introduction year Marine basis in the prior the for XXX segment from offering cost This partially offset by past Marine segment containment decreased to volume was

to XX. Slide now the Moving balance sheet on

quarterly of month, X.Xx. Winnebago X.Xx, dividend slightly end Industries of which the our will cash range is pay X.Xx of This a targeted to As a approximately the quarter, above of ratio had debt-to-EBITDA we of $X.XX has net in dividend. June of paid common to per shareholders as prospects. quarter sustained speaks the XX, growth Winnebago to This Industries and a performance the marking confidence our of consecutive strategy, record share Board's record XXth

we quarter, $XXX the a at repurchase million cost our shares remaining approximately quarter million. program. end, we had During repurchased of total of stock $XX At in XXX,XXX

in We fiscal million $XX million and dividends. year-to-date paid have our of have repurchased stock of $XX

we the of to selling back the sentiment will call the early expectations. end tepid part Based marked business on turning fourth the quarter, fiscal have current caution some Before on anticipate of color near-term remain provide consumer reflecting environment, dealer let Mike, the season. through the that sluggish market retail and our the me our

Our commitment remains steadfast.

will points guide we market our our the will preferred tailored navigate premium to its new price wisely, on industry our profitability exciting current products customer us long-term We capacity maintain introduce our across prioritize short-term use effect base's as downturn This share. positioning, and commitment and brands.

to call back closing turn Mike Now you. let provide the back to comments. some me to Mike,

Bryan. Thanks,

Slide XX. to Turning

favor future think joyful the their drive the with long we term of best with success with As will about their that seamless and business, a over who we partners customers. continue brands fortune experience mutual our the to believe companies the dealer for end-to-end

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Some having is dealer Industries where that relationships, Winnebago lean is certainly in. dependent and to continues area of great that on an

back demand focus settle are deeper As much and trends pattern, shed brands smaller dealers more the trustworthy into relationships normalized beginning on instead OEMs. with to a

to valleys a weigh family we with macroeconomic expand over of us peaks The dealer end to of currently inventory. of Marine outdoor and of provide seeking preferred RV over on we count the on and industries not built the real to exclusive and willingness the are and Winnebago impacted Industries delays can through time they cycles. factors order continue ownership. know calendar they have do QX, Bryan's our We on partnerships the year. notable end dealers seeing rates will more Consumer customers with difficult lowering in advantage brands life carry their the improvement comments and To by through relationships even sentiment other because of interest on dealer expect the recreation

in sequential the QX to mind, on a down top are slightly basis flat line. QX we on anticipating With factors revenue be these versus Industries Winnebago to

face market inventory the sequentially the prevailing as profitability primarily margin continue and to are, and dealer trends to be lean are industry consistent will well. pressures of heightened tied appropriately to These the pricing we levels. yield expectations anticipating with preference on and with also are challenges stay or consistent in in sentiment their expect down retail and discounts, will form We we therefore,

therefore, This also shipment mentioned consistent financial we our that wholesale with of year share, expectations full is calendar and and guidance our for the earlier. performance retail

provide call will said, and our in of future remains the calendar on We of fourth the updates during year business for October. That our calendar remainder for earnings bright. year XXXX expectations further XXXX quarter

Winnebago to storied participants than recent recreation, time of or most Industries at XX% with in outdoor Survey strong our show today saying demand in Spotlight Industries participation plan Our positioned outdoor continues is increase to current their better history. any Winnebago for they maintain level activities.

If compare when a our position share, breadth market performance we in to similar in XXXX, and of of much in performance. retail today what were in you RV where position financial are terms was to are we we industry portfolio better experiencing XXXX,

brands range compare a have robust compared products as wider portfolio reaching Likewise, of with you portfolio well we points. across array all of of XXXX, pre-pandemic price our our sits more if where brands as a today to features broader customers a

All stronger performance to more financial robust a and balance sheet. has much of this translated

signifies of in proud position the acknowledge confidence in the Newmar, appeal brands, customers Industries. team market of to have across great of X,XXX and of brands, closing, trust nameplates those the a level reliability. Design, as high each The a their extremely recovers consumers me unique regain Barletta the almost us of Grand are quality, customers Winnebago, We work economic Chris-Craft and let footing. In putting Winnebago carry safety an and our attraction members and that premium

asset, vertical our they vehicle the Great, lithium value day new the and who extremely I and people also Battery battery brands support, enable and space specialty Lithionics both deliver industry positively proud business strongest to is strategic design every Outdoors. across build mobile and The the to Be are new outdoor applications. winning of customers technology disrupting Our our in am these

the back to who line the I will the over that, for questions. your call will With open operator, turn

[Operator Instructions] BMO Markets. question Thomas-Martin comes Our first with Capital from Tristan

is the carryover it, inventory of guys to think carryover to industry? you do the and order. headwinds inventory remaining profitability where that kind you or quarter clearing fourth And Mike, for for in tied incentivizing then while dealers is at you're the the just then

start Yes. carryover question half Tristan, first of I'd your in the inventory. like with back of terms to

of conditions pleased The generally of levels as given facing the we today. sit we're space with seem total Towables inventory type composition the in are at. market us the for we're to We inventory bit in be very We work base appropriate continue but we better, a aging inventory inventory that prefer for towable to specifically. where on for field little our quite the

RV maybe our the Motorized actually inventory but inventory not in might by Our think our again, other position And in as slightly side dealers is field than aging higher on Motorized the the competitive any OEM we as very like, much. market.

very of to in brand Lastly, all significant and positive are inventory. to a comfortable way retail to Marine a to they position -- put inventory pontoons, shipments quarter to Barletta and inventory we be continue that market all, we transitioning that and will over composition minimum. share field bit But on more dealers pressure their that position okay recently side, that of at the to work a aged that to that next continue continue here in field the specific with about we while gaining in obviously the particular will a partner segment, feel levels on on the on generally inventory feel

on as introductions, of an XXXX example slightly actually of year XXXX We we our XXXX some the or that some continue model year product. to delayed can have so work model

you Bryan, the in QX. to drivers about ask I profitability might talk

our of reimbursement some that in June, biggest the the terms and the pressures have you tougher as marketplace Tristan, I to start start period, on about the programs in sorts what we industry a interest to kick to think, in, discounting to season QX have driver, right? it July, for alluded continued just we going Yes. allowances, We our example, through Marine on dealers' of to And it, anticipating on get talked of ease willingness selling is environment August take versus QX Also was kind in than, side, I think QX. you the sequentially, product. be seasonality

would guidance a well bit So sentiment. and tough continued I very market that profit a speaking, conditions characterize provided think dealer as as seasonal expectation of broadly I we as of

from Our comes next Citi. James question with Hardiman

make aging moving there? front, say that the at So been year want maybe process commentary year on from heard into the the speak that introduction you to will they some the catalyst for I orders to a exacerbate of back they're you the the some some an don't you're it model their little make we've 'XX surprised hear way actually that thought the is a dealers changeover, model think begin Maybe the Certainly, be 'XX. of model actually of further because inventory to of waiting pushing level the there, to there's issue. once industry discussion to channel? And any think year thoughts do up 'XX

Mike. is this James,

'XX be is year still same X me about aged work entire my timing model dealers carryover to think are the the in of field. our we with are comment specific delivery a inventory own we, on of any in portfolio it And more being to of comment on does Let we best model the our where have intentional pockets continue portfolio 'XX model the My the One, for lots. to number reasons. bit of apply two, very on certain year product little way. may not 'XX. and year the in There

quarter, year very of dollars our small number to a number some of nonexistent the Our the the model age we of against And select end model support year at 'XX inventory on third of units. 'XX side products. continue virtually is put promotional

So focus 'XX. really that on is our there

and year will And hopefully, move to the activity will good based by OEMs me year release a future I'm the move continue discipline mid-summer will window. -- model believe up. the year make on industry Industry my other makes future window actually appears that, to I sense. And common a say -- In seeing reasonable the terms in that in more across opinion, to of towards timing, we to continues the actually the probably it would I that model RV period. I stay it years hearing, model transition in that period in time it see think don't

There's introduction, total been a model summertime side year of to the outliers. just on some that outliers couple

in I regard. less has players disciplined the Motorhome think are The the been disciplined. that big for most part

you were at if industry to year year largely So here history certainly look Motorhome year turnover. by earlier ] when period the next segment July it is this has introduce than [ to the continued agrees model and the summer in model a segment, had shakes hands and the

Some by providers is OEM, changeover, a the the side timing on driven having of model that different Motorized the of chassis too. year

Got the a you conclusion. you sounds so on both of meaningful like to then major lead frame increased think to going that give and warranty of be expense. maybe the And warranty. don't that the through flex quantification It us warranty you transferability driver could the walk issue, it's assumptions the it. the us extending to any But

Mike. is this James,

now, excessive year standpoint, be. in around alluded, Bryan The several all unit nor warranty flex Let me most impact as been frame Wheels nominal. levels fiscal flex stakeholders Grand from actuality of of issue including frame it as excessive perspective of businesses, our Grand put as impact in financial date which to company warranty experienced Fifth sort has is Design. any a its have This for 'XX Design not in built regarding of history large in issue. we this And than of are Less everybody. X% maintaining perceive entire an is the to in historical impact

will to future and our years Grand seeing In that that we the financial on the its have customers the of in topic. announcement business future this that made little year the this the products warranty impact complete fiscal and candidly to will consumers or in current confidence provide to fiscal we're we Design rate rest in utmost signal support maximum the with very come given

and line why is a be that's used warranty word on now, future. comments. in anticipate in misinformation that the having our So impact significant to prepared expense not we This my don't the I the case topic

add that. a Yes. And just to to bit little

said, as experience We some, is Mike it, Mike said, As this. course, than experience so low of less we've rate on have do X%. seen the where

Now meaningful. it, Grand instances we it, the on has have customers, And Design goodwill taken fix per then where lastly, of the cost practices. not care likewise call is those okay? seen always So

that words, taken on from Even Design of other means of as historically in warranty, outside an issues I perspective. care industry think what well. customers most has of on know the Grand types call these

it's the run that rate, effectively just already So this additional feel was warranty in extended. we

all gives why for think our event, this those extended customers reasons, on ease any this kind not we put you it, at So some perspective that hopefully, to financial warranty. is try of we call as through

good does. That's It perspective.

Bret from with [Operator Instructions] comes question next Our Jefferies. Jordan

carrying the channels see talk deeper meaningful those one of retail downturn at attrition started but either the dealer inventory versus you RV. given Obviously, or more attrition slow incremental Could Marine we channel, after the sales? you talk of the RV downturn, a about a bit maybe about the in -- and costs the little might general could Can relative to are moment. health, be guess, I going just Marine

Mike. is this Bret,

yet. a am field didn't is as even have discipline specifically channel pontoons market As quarter, sure I'll model in, And our XXXX increasing a case we're today. in prudence so think where can both and but focus before, also Marine the and support inventory. the I we've with managing third share and Marine their our discuss because market the an single environment, stated this extremely comments the lies. the And their where been majority where I we that here my business way it retail our a year that's, segments example, in at product volume business, the pleased obviously, difficult around we the of they've that is. Barletta-branded -- I'm on of that's not don't is of end

that of continue their desire that we are of dealers turn market So lines, transactions not all year any share, the sure to they pressures in drive inventory a sure make good out and carrying that double-digit making have. to with some that costs, our Barletta, on the retail inventory are retail across Barletta focus we're and facing just of levels model flooring working their but in example, profitability an they both the on in partner rate them a their as on manage acceptable costs they're running drive help position to 'XXs that light also

that we've is share, can And our ourselves after the end stronger so happen inventory by without inventory in fourth to driving model as Barletta for anticipate the the will in quarter a 'XX brought also position that dealers the go we range of to third actually thing the lower time sacrificing position think release over so we year we somewhere do And line bit that down little quarter. of XXX probably particularly ability market here, an best units. to total of field even that for the And our period. probably double-digit August XXX

XX get to place X:X a it business. hopefully, So to going to market in think, particular be inventory really in is XXX ratio we're here even stabilize make we the decent a conditions shape days. really, where stronger and to that with, our back will in, to Marine over and next retail position can shipment then I begin And

in for and and them, to the Bret, them at get season. of profitability some Marine here, if think through least the I were flow dealer decent selling get it's cash RV broader best selling season They'll asking health right? about through year have the the you both just time as general,

and a I there call some again, to of a the dealers pulling that think heightened on in really and production very making piece, I is good and have But Marine, carrying above back that what which, they to speaking, Marine OEMs, it, hearing are trying very am job with acknowledge we're RV. costs. need sure broadly small the remaining through doing at them get is want only certainly exposure, selling help what the to season

into. broader question, wanted your just was that if So that throw to

Our from next Swartz Michael question securities. with Truist comes

specifically, down just more into and the Motorized Maybe business. a little drilling profitability bit

productions past down, come over and been sticking the range. or they've I think X% X% were EBITDA kind that as really year margins of in in this range X%, so quarter the

during understand, And the I So two, going it how guess, we maybe us XXX about about should think to drive that guess, one, points. I forward? basis quarter down third changed what help then

needed the That Mike. Certainly, might brand as get how wasn't also seeing retail to April of any heaviest. Winnebago bit of to to terms higher improvement as some a talked then thought really in pressures about little market We with be discount and conditions. and brands It ahead was production May. it say, that a aggressive be considering There market faced continues the that. specific I'd certain, the weigh the deleverage in caused, we us. we market of its on in affected result

impact. And that big a was so

down mix have you market a productivity see from and to our well. that the and that as slowed juggle were to as product production where wanting things as perspective one Productivity, becomes those expecting of our below drove we

door. the getting that So units in form the -- direct labor and in of productivity out the labor direct both

] were those QX. [ fought the So here things in that biggest our we

I on you can or give but the, the on color opportunity from dealer the doors base? And the think on levels any Lineage, then there, business? hasn't this about, of number response initial yet, maybe any what I maybe initial the new will stocking look And officially context and distribution that us around know maybe the way to Grand product the just launched Design Okay. guess, like

Mike, this is Mike.

the I City. in be comments, York product actually As specifics mentioned we in will New unveiling Saturday this our more about

we dealers our on number time Towables of list I bit that what committed We every Grand have dealer we Design the as product that list. to quality will of stocking mutually the not say But as impressive is line. share the at have can on this that

carry it brand several loyal and of fact, for dealers same, Grand Design the Motorized that fantastic includes but includes few the launch. also new Grand Design Towables, dealers to the In it specifically a

majority very earlier, probably of this I the deliveries then in begin the orders stocking said fiscal on amount shipments of of light have August and product. we will will 'XX. late the As in fourth in And quarter, a month

here, includes obviously, to I conversations, all happening. well current Motorized reflect we those Design a backlog are those And don't But stocking in commitment begin much this firm those at you any very orders time. the believe up on as Grand so we order orders, as to our backlog.

will fourth you October. that to so begin quarter impact And in we the earnings announce of see probably our when

specifics Grand products first as be I to months, we couple C in X probably is a the Class you I Grand the we're this Design the are the our bringing would months of several that The Design and more X providing next, mention, the of other to will other on thing here And on over is market will not on yet Industries probably that Lineage about products XX that Motorized drawing could say, well. hear and intentions next the Winnebago from board.

we're more is beginning and to this details So as come comfortable. the

from comes Our Capital question Zatzkin with Noah KeyBanc Markets. next

guess the of affordability just the of kind related concerns kind I industry. to in

then up if I price ASPs from had about the on OEMs. wondering motorized segments? somewhat other how think could from increases industry of some you provide Just chassis kind you're they're we any color across that of picked expecting relatedly, thinking And participants auto kind

So ASP it model increases? and 'XX, Kind is Motorized cost kind are of through as to side you offset how there? like, relates an of those year thinking the

note I'll This did I the Yes, of part question. see chassis your is Bryan. on your start costs. second with

frankly, We on I It's last as and magnitude because cited. most industry digestible be over think, size certainly, our has will the the the to of you will increases increases. I the seen years it think, that There's But minimize they remaining be and still coming those the relates we're remaining in X I the of to price mirror. those that pressures want nothing but inflationary anticipating, chassis in increases in seen some don't we've of rearview ability remaining years. increases, to have modest been motorized for chassis motorized the high.

So with affordability that gets guess broadly. start into you then it kind I'd the raised of I question And that.

seeing on of cost the environment. So I'll question. to benign side, And very shift part we're the Towable that

we at 'XX, they're our apples-to-apples look on ] neutral. to very BOMs [ if basis, an So from model year 'XX

lot on What that allows doing that our premium And address points pricing likewise compromising of do preference that new will neutral position. basis. a lower be a product without for an as brand to us introducing to we're so customer is price result apples-to-apples

all the So aggressively. an the the Access, the to is Design Transcend Reflection the that for share the but point product Influence, those position, defend help some new on model of think market Winnebago our One stick-and-tin will products price like side, maintain premium also introductions of the more branded. examples example, Grand start we XXX, These are

what So on we're the doing Towable side. that's say I'd

side, On back significant we comments, modest the X%. Motorized my -- more we don't expect earlier going apples-to-apples the expect X%, increases, to BOM don't in

on. on teams where those product address will a that think pricing, that it's with the introductions by some the we will so the appropriate Motorized as be working really well we will end us and the points price help the be entry competitive. Grand Design new accordingly And as product well are at think that customers to side find they in we terms received positioning of dealers very Certainly,

from Craig Baird. comes question with Kennison next Our

to I of most follow Mike's up question earlier. already, them wanted addressed You've but on

Would accretive it that in in philosophy in to and Motorhomes. Design margin expect Motorhomes is in way it margin be around Motorhomes Grand the profile of opportunity, that over that to Regarding within brand time the the you scaling Towable? what's

the of highly answer has I to intent profitability business. after team very have we majors. have Motorized their The stated Motorized profitability product vary in do probably overall by committed that But Certainly, candidly differentiated, But type. their will profitability profitable product profitability portfolio premium the very We to Grand anticipate is market. at Towables is, our accretive sought Design Craig. Grand first to and will valued is Design often our Design major be expect we in the that to appreciate will Grand the motorized all, comparable yes. that that question. of yield.

And be what of future projections quite the of with but of subsegments the so some volume acceptable. far on on should some based we pointed that that that product anticipate, also so their be work, line category. And on seen higher will motorized at profitability the the we've products Lineage

execute very I competition stated. isn't So freely. what the to time just will to market share will certainly, need tell, going to team hand Design Grand And

a battle, intense an that anticipate and we product we line. have very but team So focused strong on

initial Craig, will months, of some quarters the require course, In up. scale initial

be So it's immediately very not to accretive, it will certainly but soon. expected

follow you particular, around that? margin just if then that profile, revenue X.X% Motorhomes through comments help stick in up, great. profile. some That's segment could in And Is And about QX maybe you to profitability range. what I'm us and made I'm could assumptions wondering suggesting? you're that think like guessing EBITDA

specifically and refrain the the guidance, guidance been going part looking forward XXXX a into our this to we better providing Winnebago was the getting that time. come couple at from we're going that into related. and I we've fall some, last forward provide into Craig, discussion we're the of segment-level to in We'll from conversations think, industry think, But as in XXXX more -- forward-looking refrain and getting wrap-up in quarters. back our segment-level of

Stember Our comes Scott next ROTH. with from question

X dealers share. that help also that the their Towables how Grand ordering which of least, share. those on just -- near-term in some back with your may new about of about Can comment market prior that players some sounds a do made talk you there's mentioned would Or expect market Just on couple headwinds. But Mike, pre-COVID I you comments? then have the at some be a a it go starting you of to maybe -- that to like they're to pressure patterns, giving Design of you opposing couple guess,

parse Just out. trying to that

a on brands more over intense well. market better have lots particularly question make part and dealers that our mentioned their that there cases the products however, does believe you segments, but have appreciate not the their decisions. Scott, of those entrants that winners trimming mean, majority as across with not just the competition as but new still are all We dealers been Towables as I not that several in challenging, of those that and actively believe is of survivors, your brand here do in That really conditions profitable trimming assortments that focus the tried focusing last turn. they question. high narrow gotten of the the do to We have on year

make being those one of if on at Grand new a is Grand County, team some Design focused some Fifth to trailer reflect of towable industry. the on of towable We Design very this the significant battle alluded for start-up you're travel and both competitive newer with the what and quite the to brand familiar on from me, bit brands. And to earlier, share as Towables with of But Design Elkhart our competition work seeing of, success from -- a is not Grand the the very segment the Winnebago their challenges. they there travel the they particularly market side, on runway going couple Wheel results probably entrants, But is ongoing, Bryan Grand is do is headway be the new side, and Transcend on line brands. forward. to of the in companies new Grand specific do Wheel the excuse combat Design, to necessary Design that think trailer believe manufacturers a Fifth will top in on that continue share

relatively has So competition been macro rational. in

versus some some bigger response we competitors for volume especially is with aggressive And long-term buys brands. the our just of industry. this though, into our of for incentives OEM have have quite seen, recently from benefits short-term where We pricing weigh to some integrity spots a the

Scott, remains competition, intense. So

question. just last Got then it. And

standpoint? RV gave really You is and 'XXs if versus a 'XXs I much it don't Could and out information you field the the side. no on comment how in made 'XXs -- a the 'XXs in percentage of that 'XXs of left there's you know

I with morning. this bit detail here Scott, little a can you share more

model were of in in X-year on probably to of we're that third side percentage XX% year that -- we were work end the again, probably It a year RV I the teens in in so higher is range ago for of RV our better would that we product to year now with May, 'XX at year ago reduce of segment, as RV end model But the bit inventory where the in. 'XXs is And time. our May, field. a the 'XX the that's the as the at low end model on at we look than in field. the inventory that focuses quarter, business, On That when comes same the say XX% certainly, at RV model pre-COVID. actually one probably you dealers the little the historically in

teams for Again, on historically OEMs to we and existentially which focus end. position, but our dangerous it. don't need think it's will it is to is dealers, so a or in high, continue too And to we do that

date our across So trending performance is brands. the direction. RV By to than retail right way, it's our the trending June in better the May retail

hopeful are so that, to And is retail trend down helping from we years bring prior June that that inventory well. in model as

Our next question comes James. from Joe Raymond with Altobello

industry you June an as May. to Winnebago that last little about being I first, up comment better on specific? bit guess, that I than just it wanted just was Or comment well? Mike, a was pick made

Winnebago No, to brands. comment Joe. was RV My Industries specific

running at weeks X We of X-week fiscally, June retail actuals. belts versus It is performance comp of kind but total a more retail. the the favorable in a weeks' of retail a under than bit a environment. our rate is a way It's And last still rate June. from it standpoint is we This month about about of we count May have X have comp maddening our inconsistent.

macro, skies are The foot retail you where more week, week May. in retail emerging. speak traffic steady, Industries. you'll to we than X that. Winnebago better little next a we that inconsistent. bit And see the see industry. are We Yes. insight week. in can remains were then echoing dealers sequentially is in June the into for have You that's difficult think again, a blue yet we're And retail The But seeing but don't

and at on see good But What cause them a to or more other that. push X in follow-up them pattern? probably think your network to dealers order a is hearing Okay. you at cautious I need Helpful. more mentioned obviously, or ordering from what this And several I ordering do mean, start normalized what just it. do dealer are you months to normal dealers going would X times terms start of rate. you call calls. a to obviously, mean,

heads I this That following. that Number retail obviously, to think. where see is our ultimate that. prior positioned that is, two, is my inventory. confidence forward. the they'd Number in retail the call, a than in an especially they'd a I'll 'XX is going When from, ask today, the 'XX of be Joe, you and there extended question, higher for case, to little And shot period would their a one, to both what model flat-to-positive 'XX better dealers answer like question, inventory of future best like and that bit year have is it stabilized position the level in

to on of negotiations at then of on of cost make 'XX sure some competitive that being number OEM that buy times they up relief that retail end ends. to pricing or model either want trade them, real cost they or carrying understand consumer of the inventory on through down macroeconomic year some and I And Third, is lastly, directly is the rolling pressures that that they product that those of out probably the there. the support think a is four, is for cost sort i.e., financing signal

inflation believe So points. is really with our to referenced of stability materials more see factors. are bill a our competitive I days. able affordable more board the hard in those getting price price think that on stable the is that. it's across Bryan working bit we OEMs and little a future And on combination We're of lineups. world these nominal

June the little think May. bit retail than better I a pieces So are coming is together.

So sluggish, and in we to rest that accurately upside are in terms listen, remain pivot the slightly the indicated an calendar but to beginning, nobody's of sort XXXX timing around. cycle been of could conditions the improving of comments come prepared think able to that the we call our of here

Whiston Our next Morningstar. David comes with from question

Towables In the press release, you Motorhomes. called out and inefficiencies on

Motorhome more earlier, Or variables is curious, is inefficiency, talking the like direct other that about it labor? the Just is were chassis related? of you

had And launches Winnebago would plant some as on in we line, mentioned, didn't that David. them we I product as labor, we the direct Towable some to have the go had more terms liked in consolidation the It's new side, of then productivity.

things are drivers. the those that really I So mentioned

down Marine, in but Okay. about also share. rising there, And talked XX% was Barletta revenue you

is that too where the the right there maybe curious, a customers Chris-Craft sidelines So headwind much on more may just side be bit on I'm now?

earlier. the I of to on a on some Barletta terrific line, the impacting product terms we've result segment. are brand, the is small expansion dealers Aria with brands the the really our willingness dealers' Chris-Craft really don't their network Marine niche It's other too on by all of lots the take product. Even Pontoon, that's and of having story but Barletta think It's impact segment. that, the case, the just expanding to sense additional as of much in the too momentum broad dealer lots the No, dealers some mentioned, our not competitor versus side presence of David. inventory. conversations on there certainly network the expansion a got itself, with presence, when about the I dealer of

levels more carry side months to it's in dealer So of some related to inventory past over X the high X off particular. coming right appetite really now, to the in Marine inventory

actually David, brand. of last seen that I'll months on specifically mention on comp Chris-Craft year-over-year X we've positive the each that retail

little this is Chris-Craft see product the XX supplemental of higher we as currently. well Slide it from promising. that's a point, Dealer So at enthusiast look could XX, MSRP make is provide really brand which brand if day, that in for brand that water than with a slides in called which like a Sportster you'll Chris-Craft on And sports to would sort inventory, the to waves, we you be the at the during probably Bryan's some a product no a under of intended, an for think, is quite starting business. attractive premium future pun that way we Chris-Craft that that $XXX,XXX, positive new

remaining as the for competitive Bryan to of brand on brand as that that years hard but working us. the old, about team a and said, well, XXX end. also we're serious cherry It's is So top it's very Sunday on

on or quality-related All Is right. something earlier. last one issue question issue And direct talked just we labor that the else? about

the that certain that is quality done main In portfolio. The I be but environment Yes. that say on of to of there's top things with not dealing level that side main an the the it's instances, at this. that, deleverage occurs in product shipments, driver wouldn't the mix the it's we've just shifts some the like and need been driver.

would characterize that. related more I to So it

introductions initial but that's product that have terribly We well, some to had past. have productivity new unusual challenges caused not relative our some as

anybody? Are furloughing not You're you?

responsibly we react the X,XXX years David, market 'XX. 'XX, at around to several fiscal back over X,XXX almost peak employ of to the We worked fiscal in were downturn. a probably employees last We today. employees

workforce health And been the carefully so market our rightsizing size we've very hopefully to of our and of and size the and the the respectfully business.

manage that over adjustments make in been of doing office we as so workforce, standpoint the carefully. diligently this and/or a manufacturing both very years past And market. And we've we from the down couple

businesses. just the front, on great of our certainly a new management quality having and here but quantity that no constant So of right teammates news at

closing Ray Thank now the like any you. over turn for would call remarks. to to back Posadas I

joining you Thank this us morning. for

and summer, We meeting you have throughout to Please of summer. number This conferences and the investor concludes earnings QX of call. day. enjoy a look we forward your throughout the our rest non-deal the planned roadshows with

participation. Thank for the you concludes This your conference. you. Thank

You may now disconnect.