EX-99.1 2 p73381exv99w1.htm EX-99.1 exv99w1
 

EXHIBIT 99.1

(CAVCO INDUSTRIES, INC. LOGO)
            N e w s            R e l e a s e
For additional information, contact:
Joseph Stegmayer
Chairman and CEO
Phone: 602-256-6263
joes@cavco.com
On the Internet:
www.cavco.com


FOR IMMEDIATE RELEASE
CAVCO INDUSTRIES REPORTS THIRD QUARTER RESULTS
Sales $38.2 million
Net income $2.2 million
PHOENIX, AZ — (January 25, 2007) – Cavco Industries, Inc. (NASDAQ: CVCO) today announced financial results for the third quarter and first nine months of its fiscal year 2007 ended December 31, 2006.
     Net sales for the third quarter of fiscal 2007 were $38,189,000, down 16% from $45,320,000 for the third quarter of fiscal year 2006.
     Net income for the third quarter of $2,239,000 decreased 41% compared with $3,774,000 in the same quarter one year ago and net income per share based on basic weighted average shares outstanding was $0.35 versus $0.60. Net income per share based on diluted weighted average shares outstanding was $0.34 versus $0.56 last year. Included in net income for the third quarter of fiscal 2007 is income from discontinued retail operations of $134,000 or $0.02 per basic and diluted share, as compared to $252,000 or $0.04 per basic and diluted share during the same quarter one year ago.
     Income from continuing operations after income taxes for the third quarter of this year was $2,105,000 or $0.33 and $0.32 per share based on basic and diluted weighted average shares outstanding, respectively, versus $3,522,000 or $0.56 and $0.52 per share, respectively, for the same period last year.
     For the first nine months of fiscal 2007, net sales decreased 2% to $135,302,000 from $138,287,000 for the comparable prior year period and net income declined 10% to $9,790,000 from $10,833,000 last year. For the first nine months of fiscal 2007, net income per share based on basic weighted average shares outstanding was $1.54 versus $1.72 for the first nine months last year, and net income per share based on diluted weighted average shares outstanding was $1.48 versus $1.61 last year.
     Joseph Stegmayer, Chairman, President and Chief Executive Officer, said, “We achieved solid performance in a very difficult market environment. Industry wide shipments of factory built homes have declined nationwide, including the Southwest and Pacific regions in which we participate. Consistent with industry trends, Cavco’s incoming order rates were soft during the quarter and order backlogs were depleted. Accordingly, we lowered our rates of production which had an adverse effect on efficiency and profitability.”
     Mr. Stegmayer concluded, “The outlook for the housing industry is uncertain, as evidenced by the diverse opinions of economists and analysts. However, we feel that we are well positioned in the marketplace with a broad product line ranging from entry level affordable housing to custom designed homes. In addition, the geographic markets in which we participate offer positive population growth and demographic factors that are generally favorable for the manufactured housing market.”
     Cavco’s senior management will hold a conference call to review these results tomorrow, January 26, 2007, at 11:00 a.m. (Eastern Time). Interested parties can access a live webcast of the conference call on the Internet at www.cavco.com under the Investor Relations link, or the web site www.earnings.com. An archive of the webcast and presentation will be available for 90 days at these website addresses.
     Cavco Industries, Inc., headquartered in Phoenix, is the largest producer of manufactured homes in Arizona, based on wholesale shipments. The Company is also a leading producer of park model homes and vacation cabins in the United States.

 

 

     Certain statements contained in this release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the Private Securities Litigation Reform Act of 1995. In general, all statements that are not historical in nature are forward-looking. Forward-looking statements are typically included, for example, in discussions regarding the manufactured housing industry; our financial performance and operating results; and the expected effect of certain risks and uncertainties on our business, financial condition and results of operations. All forward-looking statements are subject to risks and uncertainties, many of which are beyond our control. As a result, our actual results or performance may differ materially from anticipated results or performance. Factors that could cause such differences to occur include, but are not limited to, adverse industry conditions, the cyclical and seasonal nature of our business, limitations on our ability to raise capital, curtailment of available financing in the manufactured housing industry, our contingent repurchase obligations related to wholesale financing, competition, our ability to maintain relationships with retailers, labor shortages, pricing and availability of raw materials, unfavorable zoning ordinances and our lack of recent operating history as an independent public company, together with all of the other risks described in our filings with the Securities and Exchange Commission. Readers are specifically referred to the Risk Factors described in Item 1A of the 2006 Form 10-K, as may be amended from time to time, which identify important risks that could cause actual results to differ from those contained in the forward-looking statements. Cavco expressly disclaims any obligation to update any forward-looking statements contained in this release, whether as a result of new information, future events or otherwise. Investors should not place any reliance on any such forward-looking statements.
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CAVCO INDUSTRIES, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
                 
    December 31,     March 31,  
    2006     2006  
    (Unaudited)          
ASSETS
                
Current assets
                
Cash and cash equivalents
   $ 9,701     $      15,122  
Short-term investments
     49,900       42,900  
Restricted cash
     191       1,223  
Accounts receivable
     11,426       11,568  
Inventories
     13,039       12,733  
Prepaid expenses and other current assets
     2,582       1,446  
Deferred income taxes
     4,100       4,040  
 
            
Total current assets
     90,939       89,032  
 
            
 
                
Property, plant and equipment, at cost:
                
Land
     6,050       6,050  
Buildings and improvements
     6,857       6,744  
Machinery and equipment
     7,450       6,752  
 
            
 
     20,357       19,546  
Accumulated depreciation
     (7,721 )     (7,202 )
 
            
 
     12,636       12,344  
 
            
Goodwill
     67,346       67,346  
 
            
 
                
Total assets
   $ 170,921     $ 168,722  
 
            
 
                
LIABILITIES AND STOCKHOLDERS’ EQUITY
                
Current liabilities
                
Accounts payable
   $ 3,304     $ 6,269  
Accrued liabilities
     19,296       26,384  
 
            
Total current liabilities
     22,600       32,653  
 
            
 
                
Deferred income taxes
     12,290       11,040  
 
                
Commitments and contingencies
                
 
                
Stockholders’ equity
                
Preferred Stock, $.01 par value; 1,000,000 shares authorized; No shares issued or outstanding
     —       —  
Common Stock, $.01 par value; 20,000,000 shares authorized; Outstanding 6,374,480 and 6,352,980 shares, respectively
     64       64  
Additional paid-in capital
     122,566       121,354  
Retained earnings
     13,401       3,611  
 
            
Total stockholders’ equity
     136,031       125,029  
 
            
 
                
Total liabilities and stockholders’ equity
   $ 170,921     $ 168,722  
 
            
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CAVCO INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except per share amounts)
(Unaudited)
                                 
    Three Months Ended     Nine Months Ended  
    December 31,     December 31,  
    2006     2005     2006     2005  
Net sales
   $ 38,189     $ 45,320     $ 135,302     $ 138,287  
Cost of sales
     31,871       36,365       110,316       110,086  
 
                        
Gross profit
     6,318       8,955       24,986       28,201  
Selling, general and administrative expenses
     3,765       3,946       11,904       12,265  
 
                        
Income from operations
     2,553       5,009       13,082       15,936  
Interest income
     589       387       1,782       1,033  
 
                        
Income from continuing operations before income taxes
     3,142       5,396       14,864       16,969  
Income tax expense
     1,037       1,874       5,208       6,388  
 
                        
Income from continuing operations
     2,105       3,522       9,656       10,581  
Income from discontinued retail operations net of income taxes of $66 and $148
     134       252       134       252  
 
                        
Net income
   $ 2,239     $ 3,774     $ 9,790     $ 10,833  
 
                        
 
                                
Net income per share (basic):
                                
Continuing operations
   $ 0.33     $ 0.56     $ 1.52     $ 1.68  
Discontinued retail operations
   $ 0.02     $ 0.04     $ 0.02     $ 0.04  
 
                        
Net income
   $ 0.35     $ 0.60     $ 1.54     $ 1.72  
 
                        
 
                                
Net income per share (diluted):
                                
Continuing operations
   $ 0.32     $ 0.52     $ 1.46     $ 1.57  
Discontinued retail operations
   $ 0.02     $ 0.04     $ 0.02     $ 0.04  
 
                        
Net income
   $ 0.34     $ 0.56     $ 1.48     $ 1.61  
 
                        
 
                                
Weighted average shares outstanding:
                                
Basic
     6,361,869       6,336,342       6,358,889       6,309,010  
 
                        
Diluted
     6,615,263       6,775,614       6,625,725       6,721,977  
 
                        
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CAVCO INDUSTRIES, INC.
Other Operating Data – Continuing Operations
(Dollars in thousands, except average sales price amounts)
(Unaudited)
                                 
    Three Months Ended     Nine Months Ended  
    December 31,     December 31,  
    2006     2005     2006     2005  
Net sales
                                
Manufacturing
   $ 35,814     $ 44,013     $ 128,758     $ 133,923  
Retail
     4,078       3,864       11,874       10,211  
Less: Intercompany
     (1,703 )     (2,557 )     (5,330 )     (5,847 )
 
                        
Net sales
   $ 38,189     $ 45,320     $ 135,302     $ 138,287  
 
                        
 
                                
Floor shipments — manufacturing
     1,353       1,732       4,703       5,369  
 
                        
Average sales price per floor — manufacturing
   $ 26,470     $ 25,412     $ 27,378     $ 24,944  
 
                        
 
                                
Home shipments — manufacturing
     898       1,049       2,866       3,168  
 
                        
Average sales price per home — manufacturing
   $ 39,882     $ 41,957     $ 44,926     $ 42,274  
 
                        
 
                                
Home shipments — retail
     39       41       115       122  
 
                        
 
                                
Capital expenditures
   $ 97     $ 135     $ 811     $ 5,212  
 
                        
Depreciation
   $ 147     $ 235     $ 519     $ 696  
 
                        
###