RV lifestyle rush boosts Winnebago sales, profits
In a pandemic, SUVs and vans just aren’t enough for many Americans.
Winnebago Industries said Wednesday its profit during the winter quarter was five times higher than a year ago, and sales were up 34% as more people decided to hit the road in recreational vehicles.
“Strong retail demand, low field inventory, and record committed dealer orders set the table for continued robust performance,” Mike Happe, the company’s chief executive, said in a statement. But he added, “We also believe there is secular and ongoing growth in outdoor lifestyle products as consumer priorities have changed due to the pandemic.”
The fastest growth not in giant
RVs that haul families and retirees on weekslong trips, but in products that are used on shorter getaways.
Winnebago’s towable product segment had a 55% jump in sales. Sales in the motor home segment were 17.5%.
Consumers showed the strongest interest in Winnebago brand Class B motor homes, such as the Solis, Revel and Travato models. These models are 21 feet long or shorter and sleep two to four people.
The company, which has its management office in Eden Prairie, said it earned $21.2 million, or $2.04 a share, for the three months ended Feb. 27. That’s up from $4 million, or 51 cents a share, a year ago. Revenue was $840 million.
Strong consumer demand has driven up order backlogs and allowed the company to offer fewer discounts and allowances. The pricing advantages helped Winnebago increase its gross profit margin 590 basis points in the quarter.
The company has been operating near its manufacturing capacity but has had periodic disruptions due to parts shortages. Suppliers have helped the company increase production, Happe told investors and analysts. But he added, “We also continue to be restrained from hitting full manufacturing potential given almost daily component availability challenges.”
Happe said the company is committed to building a more diverse and equitable culture within the company and the outdoor communities. Last week, Winnebago took steps to diversify the racial and gender makeup of its board.