Class A motorhome manufacturer Rexhall Industries Inc. reported lower sales and earnings during the first quarter because of the Chapter 11 bankruptcy filing by its largest customer, the RV Supercenter dealership in Arizona.
Rexhall’s earnings declined 23% to $964,000 and its sales were down 7% to $20.7 million during the three months ended March 31.
RV Supercenter accounted for 16% of Rexhall’s sales revenue in 1999 and it currently is Rexhall’s only dealer in Arizona, according to the company.
“Excluding this one dealer, sales of our premium Class A products were up in the period although we did see some softening in the overall RV markets as gas prices and concern over interest rates have eased demand,” according to William J. Rex, chairman.
“We are working closely with the management (of RV Supercenter) and the bankers involved in the reorganization to recover our lost sales,” Rex continued. “Although difficult in the short-term, we expect this issue will result in an opportunity to expand our distribution with new dealers and in turn minimize our risk in the important Arizona market.”