Winnebago Industries reports third quarter profits down, CEO says continuing to adjust to uncertain economic environment
EDEN PRAIRIE, MINNESOTA — Third quarter profits for Winnebago Industries are down compared to last year, but the company’s CEO says they are continuing to adjust to the challenges posed by an uncertain economic environment.
The outdoor lifestyle products manufacturer with factory locations in Forest City, Lake Mills, Charles City and Waverly says net income for the quarter ending on May 31st was $17.6 million. That compares to a net loss of $400,000 in the second quarter and a net income of $29 million in the third quarter of last year. Winnebago in May announced the layoffs of about 200 hourly employees at their Iowa facilities as they were pausing their Class A motorhome production line due to current inventory levels, challenging market conditions and lower consumer demand.
President and CEO Michael Happe the company needed to address the challenges of the economy. “As we navigate an increasingly dynamic market environment, we are focused on executing the areas of the business within our control. As part of the business transformation of the Winnebago motorhome business, we have taken decisive steps to lower field inventory, improve working capital in the future, align our production schedule to market demand, reduce discretionary expenses, and accelerate stronger product value for our customers.”
Happe says the turnaround plan for the business has been in motion for some time, and that included the decision to reduce production. “One of the most important decisions we made during the fiscal third quarter here recently was to significantly reduce production of units that we otherwise would likely have had to push to the field with higher sales allowances or discounts than we were comfortable with. That decision allowed us then to make some adjustments from a production discipline standpoint and go after some other short-term cost adjustments in the business.”
Net revenue was $775.1 million for the third quarter, a decrease of 1.4% compared to the third quarter a year ago.
