Losses at high line Class A motorhome manufacturer SMC Corp. continued with the company reporting it was $2.1 million in the red for the three months ended Sept. 30.
SMC’s losses for the nine months ended Sept. 30 now total $5.5 million.
In comparison, SMC earned a profit of $130,000 during the third quarter of 1999 and it was in the black a total of $89,000 after the first nine months of last year.
The company’s sales increased 6% during the July-through-September period to $49.5 million but its sales were down 6% during the first nine months of this year to $148 million.
“Operating results continued to reflect the costs of converting the factories to a build-to-order method and the costs associated with the completion of the model year changes,” said Michael Jacque, president and COO.
If there are any more costs related to converting to a build-to-order system and the introduction of model year 2001 units, they will be minimal, he added.
In an effort to lower its breakeven point, SMC reduced its inventories 46%, or $22 million, since Oct. 2, 1999, and it lowered its labor and personal costs by 15% during that period, Jacque said.
SMC also reduced its operating line of credit 73%, or $5 million, and its overall liabilities by 16%, or $8 million, he continued. The company has no borrowings against its operating line of credit and has around $2 million in its investment account, Jacque said.