Coachmen Housing Group Profitable, RV Group Operations Improve, Despite Loss
“Although we continued to implement substantial operational improvements and cost saving projects, because of the unexpectedly rapid and deep fall in the RV markets, Coachmen Industries Inc. reported a $3.0 million loss for the quarter ending June 30, 2008. Our Housing Group achieved another profitable quarter. However, the tremendous strides in cost reductions accomplished by our RV Group were insufficient to overcome the effects of extreme fuel prices and a continuing credit crisis which has resulted in the lowest consumer confidence in over 16 years,”.Our loss of $3 million for the quarter is obviously not what we strove to achieve, but it does represent an improvement in bottom line performance of $7.2 million or 71% from 2007 in the face of a 35% decrease in net sales. Through the first half, we have reduced our loss to $1.6 million from $21.5 million in 2007, an improvement of 93%, which is commendable given what is happening in both the housing and RV markets. Our operating expenses are tracking at less than 55% of last year’s level. These results demonstrate that the actions we have taken are working, and will allow us to weather this down cycle. Nevertheless, we must - and will - take even further measures to bring our costs in line with the revenues that are the reality of these market conditions.”
Net Sales for the second quarter were $96.7 million compared to $149.8 million reported for the same period in 2007. Gross profits for the quarter improved to $6.9 million or 7.1% of revenues from $6.0 million, or 4.0% of revenues for second quarter of 2007. Operating expenses decreased $7.6 million from last year to $9.2 million. At the bottom line, the Company reported net loss of $3.0 million, or ($0.18) per share, versus a net loss of $10.1 million, or ($0.64) per share in the second quarter of 2007.
“While we turned in a loss for the quarter, we have made significant progress in reducing our break even through cost reductions, capacity utilization, consolidation, and radically improved products … both appeal and quality, however it simply is not enough in light of the current and projected market conditions and economic climate,”.And while a quarter over quarter improvement in bottom line performance for the RV Group of 44.0% on 47.2% fewer sales conclusively demonstrates the improvements we have made, we simply must make further adjustments throughout our Company to navigate the worst market conditions our Industry has seen in decades”.
Coachmen Industries, Inc. is one of America’s leading manufacturers of recreational vehicles, systems-built homes and commercial buildings, with prominent subsidiaries in each industry. Coachmen is one of the nation’s largest producers of systems-built homes, and also a major builder of commercial structures with its ALL AMERICAN BUILDING SYSTEMS products.
