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Winnebago (WGO) Q2 Earnings Miss, Up Y/Y on Newmar Buyout

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Winnebago Industries, Inc. (WGO - Free Report) reported earnings of 67 cents per share in second-quarter fiscal 2020, missing the Zacks Consensus Estimate of 70 cents. High SG&A costs and lower-than-expected deliveries of motorhomes and fifth-wheel towable can be attributed to the underperformance. Precisely, motorhomes and fifth wheel towable deliveries totaled 2,239 and 3,287, missing the respective Zacks Consensus Estimate of 2,319 and 3,328.

Nonetheless, the bottom line compared favorably with 61 cents a share recorded in the year-ago quarter. Impressive lineup of high-quality innovative products and the strategic acquisitions of Newmar and Grand Design enabled the company to deliver improved year-over-year results.

Revenues in the reported quarter increased 44.8% year over year to $626.8 million. The revenue figure also beat the Zacks Consensus Estimate of $610 million. While the company recorded higher year-over-year operating expenses, operating income increased to $29.6 million from the year-ago figure of $28.9 million due to the uptick in revenues.

Winnebago Industries, Inc. Price, Consensus and EPS Surprise

 

Winnebago Industries, Inc. Price, Consensus and EPS Surprise

Winnebago Industries, Inc. price-consensus-eps-surprise-chart | Winnebago Industries, Inc. Quote

Segment Results

Revenues in the Motorhome segment were up 97.7% year over year to $325.5 million, mainly aided by strength in the Class B line-up and the addition of Newmar revenues in the quarter. Adjusted EBITDA skyrocketed 243% year over year to $15 million.

Revenues in the Towable segment improved 13% year over year to $283.5 million. This upside was driven by robust unit growth in the Grand Design RV product line. Adjusted EBITDA was $34.7 million, up 3.3% from the prior-year quarter.

Financials & Dividend

Winnebago — whose peers include Thor Industries (THO - Free Report) , Skyline Champion Corporation (SKY - Free Report) and LCI Industries (LCII - Free Report) — had cash and cash equivalents of $122.9 million as of Feb 29, 2020 compared with $37.4 million on Aug 31, 2019. Long-term debt totaled $451.1 million, representing a debt-to-capital ratio of 36%

The Zacks Rank #3 (Hold) firm approved quarterly dividend of 11 cents per share, payable on Apr 29 to its shareholders of record as of Apr 15, 2020. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Operations Halted Amid COVID-19

Amid the coronavirus pandemic, the recreational vehicle maker has temporarily suspended most production activities at its facilities including Grand Design RV, Newmar and Chris-Craft till Apr 12.

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