Monaco Coach Corp.’s sales in the third quarter were better than anticipated, so the Coburg, Ore., company is gradually increasing production, Chairman and CEO Kay Toolson reported today (Oct. 21).
However, Monaco’s financial performance in its third quarter, which ended Sept. 27, continued to show the impact of the accumulation of excess finished goods inventory this spring, which led to product cutbacks and worker layoffs in April.
For the July-through-September period, Monaco’s net earnings declined 47% to $6.3 million and its sales revenue declined 4% to $303.2 million.
For the third quarter of 2002, Monaco earned $11.8 million on sales of $314.7 million.
After the first nine months of this year, Monaco’s earnings were down 66% to $11.2 million and its sales were down 8% to $845.1 million.
In the first nine months of last year, Monaco’s net earnings amounted to $32.4 million and its sales totaled $922 million.
“The retail market remained strong throughout the third quarter and our retail partners responded with increased orders resulting in better than anticipated revenue,” Toolson said. “Combined with the successful reduction in our finished goods inventory, this positive sales environment is allowing us to gradually increase our overall production rates.”
Monaco’s model-year 2003 and 2004 units both “retailed well during the third quarter,” Toolson continued. “We remained aggressive in terms of retail promotions to help move 2003 products throughout the quarter. Our retail dealers’ inventories fell again in the third quarter as retail sales outpaced wholesale shipments.”
Monaco’s finished goods, also referred to as factory yard inventory, totaled $20.9 million as of late September, compared with $46.5 million as of late June, said Marty Daley, vice president and CFO.