National RV Holdings Inc. reported its sales increased 2% but its earnings declined 11% during the first quarter.

The company earned $6.5 million and its sales totaled $105.2 million during the three months ended March 31.

National RV’s earnings were down largely because of a $1 million one-time-only warranty expense, said Wayne Mertes, president and CEO. The warranty expense was for correcting a weight distribution issue in certain motorhomes, he said.

Meanwhile, Mertes anticipates the company’s second quarter sales revenue will be 10% to 12% lower than it was during the second quarter of 1999.

National RV broke ground recently on a new towables plant in Perris, Calif., and the company is previewing prototypes of new towables products to selected West Coast dealers now, Mertes said.

The new towables plant is scheduled for completion in September.