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Fleetwood Enterprises Inc.’s RV Group posted a $17.7 million operating profit for the first quarter of its fiscal year 2003, although the parent company reported a net loss of $1.5 million for the period.
However, Ed Caudill, Fleetwood’s new president and CEO, believes the leading RV and manufactured home producer will report a net profit for its second fiscal quarter, which will end in late October.
A net profit for the August-through-October period would be Fleetwood’s first in more than two years.
Fleetwood reported a net loss for the three months ended July 28 primarily because of the $9.7 million operating loss posted by its manufactured home retail business.
In addition to the $17.7 million operating profit from Fleetwood’s RV Group, the company’s manufactured home-building group reported a $3 million operating profit for the May-through-July period.
The net loss of $1.5 million for the three months ended July 28, compares with a $91.8 million net loss that Fleetwood reported for the first quarter of its fiscal year 2002.
Fleetwood’s net loss for the May-through-July period of last year was expanded by the $80.6 million write-off that Fleetwood took to represent the lower current market value of the manufactured home retail businesses that it acquired during the late 1990s.
Caudill said he was particularly pleased with the turnaround at the RV Group, which experienced a 39% increase in sales revenue during the May-through-July period to $371 million.
“All three of the RV divisions (motorhomes, travel trailers and fifth-wheels, and folding campers) were strongly profitable this (past) quarter,” Caudill said. “Our motorhome division produced a 73% upsurge in diesel sales primarily due to the introduction of new products.
“In addition to increased sales, the travel trailer division reduced its operating expenses by 16% and improved its gross margin significantly, which was key to achieving profitability,” he continued. “It is especially gratifying to see the recovery on the RV side of our business, where our team has been proactive in dealing with past mistakes and has, we believe, re-established the Fleetwood brand.
“I expect to be an active presence in driving our exceptional associates through the remaining challenges and in seizing opportunities,” added Caudill, who assumed the helm at Fleetwood last month.