Fleetwood Enterprises Inc. reported a $39.9 million net loss for its first nine months of fiscal 2005, ended Jan. 23, prompting the company to expand its credit line and secure “additional borrowing capacity throughout the year.”
Fleetwood reported a third quarter net loss of $54.7 million compared with a net loss of $10.2 million for the third quarter of fiscal 2004. Revenues decreased 6% to $564.9 million versus $597.8 million during the same period the year prior.
“Our third quarter encompasses the three weakest months of the year in both of our businesses,” said Edward B. Caudill, president and CEO of the Riverside, Calif.-based recreational vehicle and manufactured housing builder.
For the first nine months, the builder incurred a net loss of $39.9 million compared with a loss of $4.5 million the previous year while revenues increased 5% to $2.01 billion from $1.92 billion.
Fleetwood restated that several “short-term factors” impacted its third quarter, including RV dealers “holding the line” on their inventories during the winter months.
Caudill added, “We also received an adverse judgment of $14.6 million in the Coleman litigation and incurred higher general and administrative expenses, including the start-up costs for our new shared ownership RV program, Fleetwood Vacation Club.”
The company’s RV operations generated an operating loss of $33.5 million in the third quarter, compared to $9.5 million the previous year. The division’s quarterly revenues were down 16% to $342.6 million, including a 15% drop in motorhome sales and a 19% decrease in towable sales.
“The primary factor in the RV Group’s quarterly operating loss was the decline in sales, particularly in towables,” Caudill said.
Year to date, the RV division incurred a $9.3 million operating loss, versus operating income of $41.6 million in the prior year. Nine-month RV sales declined 1% to $1.28 billion compared with the previous year’s $1.3 billion.
Fleetwood’s housing division reported an operating loss of $14.0 million for the third quarter, while significantly narrowing its operating loss to $8.8 million for the nine months.