Fleetwood Enterprises Inc. reported today (March 1) that it lost $205 million during its third fiscal quarter, which ended Jan. 28, and that it most likely will incur another loss during its fourth fiscal quarter.
The loss included a $56.1 million deficit from operations plus a $163.2 million non-cash write down for “goodwill impairment” and $10.9 million in other one-time only items.
As a result of the huge third fiscal quarter loss, Fleetwood now is in the red $239.5 million after the first nine months of its fiscal 2001.
In an effort to stop the tide of red ink, Fleetwood has eliminated 5,500 jobs, or 28% of its workforce, since October 1999, said Nelson Potter, president and COO.
Because of the third fiscal quarter loss, Fleetwood now is “in violation of certain financial covenants in the agreement governing $80 million of unsecured notes with the Prudential Insurance Company of America.” Fleetwood is current on its interest and principal repayments, but defaults allow Prudential to ask for speedier payments or other remedies. Fleetwood currently is discussing a waiver of the covenants with Prudential.
A default on the Prudential notes could lead to Fleetwood defaulting on another $100 million of secured financing on the inventory at its manufactured home retail centers, according to the company