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8-K


 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 
FORM 8-K
 
 
CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
 
Date of report (Date of earliest event reported)  March 24, 2016


 
 
 
Winnebago Industries, Inc.
(Exact Name of Registrant as Specified in its Charter)

Iowa
001-06403
42-0802678
(State or Other Jurisdiction
of Incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
 
 
 
P.O. Box 152, Forest City, Iowa
 
50436
(Address of Principal Executive Offices)
 
(Zip Code)
 
Registrant's telephone number, including area code   641-585-3535
 
______________________________________________________________________
(Former Name or Former Address, if Changed Since Last Report.)
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
o         Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o         Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
o         Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
o         Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




 




Item 2.02 Results of Operations and Financial Condition.
 
Winnebago Industries, Inc. is filing herewith a press release issued on March 24, 2016, as Exhibit 99.1 which is incorporated by reference herein. The press release was issued to report earnings for the second quarter of Fiscal 2016 ended February 27, 2016.

Item 7.01 Regulation FD Disclosure; 8.01 Other Events.

Winnebago Industries, Inc. (Winnebago Industries) is filing herewith a press release issued on March 24, 2016, as Exhibit 99.1 which is included herein. The press release was issued to report that on March 16, 2016, the Board of Winnebago Industries, Inc. approved a quarterly cash dividend of $0.10 per share of common stock, payable on April 27, 2016 to shareholders of record at the close of business on April 13, 2016.

Item 9.01 Financial Statements and Exhibits.

(d)    Exhibits

Exhibit
Number    Description
99.1        Press release of Winnebago Industries, Inc. dated March 24, 2016.




SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
WINNEBAGO INDUSTRIES, INC.
 
 
 
(Registrant)
 
 
 
 
 
 
Date:
March 24, 2016
By:
/s/ Scott C. Folkers
 
 
 
Name:
Scott C. Folkers
 
 
 
Title:
Vice President, General Counsel and Secretary
 



Exhibit


News Release
Contact: Samantha Dugan - Investor Relations - 641-585-6160 - sdugan@wgo.net
Media Contact: Sam Jefson - Public Relations Specialist - 641-585-6803 - sjefson@wgo.net

WINNEBAGO INDUSTRIES ANNOUNCES SECOND QUARTER FISCAL 2016 RESULTS
-- Gross Margin Improvement of 90 Basis Points Contributes to Earnings Per Share Growth of 17% --
-- Board of Directors Approved Quarterly Cash Dividend of $0.10 Per Share --

FOREST CITY, IOWA, March 24, 2016 - Winnebago Industries, Inc. (NYSE:WGO), a leading United States recreation vehicle manufacturer, today reported financial results for the Company's second quarter of Fiscal 2016.

Second Quarter Fiscal 2016 Results
Revenues for the Fiscal 2016 second quarter ended February 27, 2016, were $225.7 million, a decrease of 3.8%, compared to $234.5 million for the Fiscal 2015 period. Operating income was $13.5 million for the current quarter, an improvement of 13.0% compared to $11.9 million in the second quarter of last year. Fiscal 2016 second quarter net income was $9.4 million, or $0.35 per diluted share, an increase of 15.5% compared to $8.1 million, or $0.30 per diluted share, in the same period last year.

President and Chief Executive Officer Michael Happe commented, “Since arriving in mid-January, I have enjoyed the privilege of actively engaging with many of Winnebago's employees, dealers, and our Board of Directors. All are extremely committed to building a stronger future for this iconic brand, leveraging an already impressive legacy. While we are pleased with the improved profitability delivered this quarter and the strong continued momentum of our Towables business, we are mindful of lower motorized revenues against the industry's strong fundamentals. Our motorized team will continue to focus on delivering the industry's highest level of product quality while working to create sustainable, increased levels of manufacturing output. With the success of recent new products, a current robust backlog, and ongoing investments in new systems and facilities, we believe we have a strong foundation to continue to build future value for our dealers, customers, and shareholders.”

Second quarter Fiscal 2016 consolidated revenues decreased year over year due primarily to lower motorized unit shipments of 3.4% and the Company's exit of aluminum extrusion sales to outside customers. Partly offsetting the decline was revenue growth of 33.8% in towables due to an increase in unit deliveries.

Gross margin improved year over year in the second quarter due in part to improved product mix and the realization of cost-saving benefits related to the Company’s strategic sourcing initiative. The improvement was partly mitigated by higher manufacturing costs.

Quarterly Cash Dividend
On March 16, 2016, the Company’s board of directors approved a quarterly cash dividend of $0.10 per share payable on April 27, 2016, to common stockholders of record at the close of business on April 13, 2016.

Conference Call
Winnebago Industries, Inc. will conduct a conference call to discuss second quarter Fiscal 2016 results at 9:00 a.m. Central Time today. Members of the news media, investors and the general public are invited to access a live broadcast of the




conference call via the Investor Relations page of the Company's website at http://investor.wgo.net. The event will be archived and available for replay for the next 90 days.

About Winnebago Industries
Winnebago Industries, Inc., "The Most Recognized Name in Motor Homes®," is a leading U.S. manufacturer of recreation vehicles, which are used primarily in leisure travel and outdoor recreation activities. The Company builds quality motorhomes, travel trailers and fifth wheel products. Winnebago Industries has received the Quality Circle Award from the Recreation Vehicle Dealers Association every year since 1996. The Company's common stock is listed on the New York and Chicago Stock Exchanges and traded under the symbol WGO. Options for the Company's common stock are traded on the Chicago Board Options Exchange. For access to Winnebago Industries' investor relations material or to add your name to an automatic email list for Company news releases, visit http://investor.wgo.net.

This press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements are inherently uncertain. A number of factors could cause actual results to differ materially from these statements, including, but not limited to increases in interest rates, availability of credit, low consumer confidence, availability of labor, significant increase in repurchase obligations, inadequate liquidity or capital resources, availability and price of fuel, a slowdown in the economy, increased material and component costs, availability of chassis and other key component parts, sales order cancellations, slower than anticipated sales of new or existing products, new product introductions by competitors, the effect of global tensions, integration of operations relating to mergers and acquisitions activities, any unexpected expenses related to ERP and other factors. Additional information concerning certain risks and uncertainties that could cause actual results to differ materially from that projected or suggested is contained in the Company's filings with the Securities and Exchange Commission (SEC) over the last 12 months, copies of which are available from the SEC or from the Company upon request. The Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward looking statements contained in this release or to reflect any changes in the Company's expectations after the date of this release or any change in events, conditions or circumstances on which any statement is based, except as required by law.
# # #







Winnebago Industries, Inc.
Unaudited Consolidated Statements of Income
(In thousands, except percent and per share data)

 
Quarter Ended
 
February 27, 2016
 
February 28, 2015
Net revenues
$
225,672

 
100.0
 %
 
$
234,543

 
100.0
%
Cost of goods sold
200,396

 
88.8
 %
 
210,285

 
89.7
%
Gross profit
25,276

 
11.2
 %
 
24,258

 
10.3
%
Operating expenses:
 
 
 
 
 
 
 
Selling
4,929

 
2.2
 %
 
4,846

 
2.1
%
General and administrative
6,844

 
3.0
 %
 
7,464

 
3.2
%
Total operating expenses
11,773

 
5.2
 %
 
12,310

 
5.2
%
Operating income
13,503

 
6.0
 %
 
11,948

 
5.1
%
Non-operating (expense) income
(18
)
 
—
 %
 
28

 
—
%
Income before income taxes
13,485

 
6.0
 %
 
11,976

 
5.1
%
Provision for taxes
4,131

 
1.8
 %
 
3,880

 
1.7
%
Net income
$
9,354

 
4.1
 %
 
$
8,096

 
3.5
%
Income per common share:
 
 
 
 
 
 
 
Basic
$
0.35

 
 
 
$
0.30

 
 
Diluted
$
0.35

 
 
 
$
0.30

 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
Basic
26,936

 
 
 
26,924

 
 
Diluted
27,015

 
 
 
27,018

 
 

Percentages may not add due to rounding differences.


 
Six Months Ended
 
February 27, 2016
 
February 28, 2015
Net revenues
$
439,895

 
100.0
%
 
$
458,946

 
100.0
%
Cost of goods sold
389,370

 
88.5
%
 
410,302

 
89.4
%
Gross profit
50,525

 
11.5
%
 
48,644

 
10.6
%
Operating expenses:
 
 
 
 
 
 
 
Selling
9,944

 
2.3
%
 
9,553

 
2.1
%
General and administrative
14,319

 
3.3
%
 
12,701

 
2.8
%
Total operating expenses
24,263

 
5.5
%
 
22,254

 
4.8
%
Operating income
26,262

 
6.0
%
 
26,390

 
5.8
%
Non-operating income
117

 
—
%
 
35

 
—
%
Income before income taxes
26,379

 
6.0
%
 
26,425

 
5.8
%
Provision for taxes
8,467

 
1.9
%
 
8,434

 
1.8
%
Net income
$
17,912

 
4.1
%
 
$
17,991

 
3.9
%
Income per common share:
 
 
 
 
 
 
 
Basic
$
0.66

 
 
 
$
0.67

 
 
Diluted
$
0.66

 
 
 
$
0.67

 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
Basic
26,956

 
 
 
26,946

 
 
Diluted
27,042

 
 
 
27,048

 
 

Percentages may not add due to rounding differences.





Winnebago Industries, Inc.
Unaudited Consolidated Balance Sheets
(In thousands)

 
Feb 27,
2016
 
Aug 29,
2015
ASSETS
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
$
36,872

 
$
70,239

Receivables, net
70,060

 
66,936

Inventories
134,169

 
112,165

Prepaid expenses and other assets
13,038

 
6,882

Deferred income taxes
—

 
9,995

Total current assets
254,139

 
266,217

Total property and equipment, net
50,719

 
37,250

Investment in life insurance
26,531

 
26,172

Deferred income taxes
19,844

 
21,994

Other assets
9,109

 
10,541

Total assets
$
360,342

 
$
362,174

 
 
 
 
LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
Current liabilities:
 
 
 
Accounts payable
$
41,461

 
$
33,158

Income taxes payable
—

 
2,314

Accrued expenses
42,428

 
46,138

Total current liabilities
83,889

 
81,610

Non-current liabilities:
 
 
 
Unrecognized tax benefits
2,248

 
2,511

Postretirement health care and deferred compensation benefits, net of current portion
26,572

 
57,090

Total non-current liabilities
28,820

 
59,601

Shareholders' equity
247,633

 
220,963

Total liabilities and shareholders' equity
$
360,342

 
$
362,174





Winnebago Industries, Inc.
Unaudited Consolidated Statements of Cash Flows
(In thousands)
 
Six Months Ended
 
Feb 27,
2016
Feb 28,
2015
Operating activities:
 
 
Net income
$
17,912

$
17,991

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
2,763

2,125

LIFO expense
588

626

Stock-based compensation
1,266

1,348

Deferred income taxes
819

7,127

Postretirement benefit income and deferred compensation expenses
(1,915
)
(338
)
Provision for doubtful accounts
7

2

Loss (gain) on disposal of property
10

(35
)
Gain on life insurance
(118
)
—

Increase in cash surrender value of life insurance policies
(401
)
(462
)
Change in assets and liabilities:
 
 
Inventories
(22,592
)
(37,619
)
Receivables, prepaid and other assets
(8,988
)
(7,560
)
Investment in operating leases, net of repurchase obligations
—

(72
)
Income taxes and unrecognized tax benefits
(1,456
)
(11,258
)
Accounts payable and accrued expenses
5,265

(4,075
)
Postretirement and deferred compensation benefits
(1,972
)
(1,852
)
Net cash used in operating activities
(8,812
)
(34,052
)
 
 
 
Investing activities:
 
 
Purchases of property, plant and equipment
(16,357
)
(5,154
)
Proceeds from the sale of property
10

43

Proceeds from life insurance
295

—

Other
(3
)
294

Net cash used in investing activities
(16,055
)
(4,817
)
 
 
 
Financing activities:
 
 
Payments for purchase of common stock
(3,054
)
(6,141
)
Payments of cash dividends
(5,455
)
(4,883
)
Borrowings on loans
—

22,000

Repayment of loans
—

(22,000
)
Other
9

27

Net cash used in financing activities
(8,500
)
(10,997
)
 
 
 
Net decrease in cash and cash equivalents
(33,367
)
(49,866
)
Cash and cash equivalents at beginning of period
70,239

57,804

Cash and cash equivalents at end of period
$
36,872

$
7,938

 
 
 
Supplemental cash flow disclosure:
 
 
Income taxes paid, net
$
12,848

$
12,565

Interest paid
$
—

$
10

 
 
 
Non-cash transactions:
 
 
Capital expenditures in accounts payable
$
750

$
—







Winnebago Industries, Inc.
Unaudited Deliveries
 
Quarter Ended
 
Change
(In units)
Feb 27,
2016
Product
Mix % (1)
 
Feb 28,
2015
Product
Mix % (1)
 
Units
%
Change
Class A
836

41.1
%
 
810

38.5
%
 
26

3.2
 %
Class B
258

12.7
%
 
277

13.2
%
 
(19
)
(6.9
)%
Class C
939

46.2
%
 
1,017

48.3
%
 
(78
)
(7.7
)%
Total motorhomes
2,033

100.0
%
 
2,104

100.0
%
 
(71
)
(3.4
)%
 
 
 
 
 
 
 
 
 
Travel trailer
796

83.4
%
 
508

84.0
%
 
288

56.7
 %
Fifth wheel
158

16.6
%
 
97

16.0
%
 
61

62.9
 %
    Total Towables
954

100.0
%
 
605

100.0
%
 
349

57.7
 %
(1) Percentages may not add due to rounding differences.


Unaudited Backlog(1)  
 
As Of
 
 
 
Feb 27,
2016
 
Feb 28,
2015
 
Change
Motorhomes
2,792

 
2,275

 
517

22.7
 %
Towables
168

 
130

 
38

29.2
 %
 
 
 
 
 
 
 
Approximate backlog revenue dollars (in 000's):
 
 
 
 
 
Motorhomes
$
253,492

 
$
216,228

 
$
37,264

17.2
 %
Towables
3,336

 
4,121

 
(785
)
(19.0
)%
(1) 
Our backlog includes all accepted orders from dealers to be shipped within the next six months. Orders in backlog can be canceled or postponed at the option of the purchaser at any time without penalty and, therefore, backlog may not necessarily be an accurate measure of future sales.

Unaudited Dealer Inventory
 
Units As Of
 
 
 
Feb 27,
2016
 
Feb 28,
2015
Change
Motorhomes
4,737

 
4,778

 
(41
)
(0.9
)%
Towables
2,306

 
1,877

 
429

22.9
 %