þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Indiana (State or other jurisdiction of incorporation or organization) |
35-1038277 (I.R.S. Employer Identification No.) |
P. O. Box 743, 2520 By-Pass Road Elkhart, Indiana (Address of principal executive offices) |
46515 (Zip Code) |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer o | Smaller reporting company þ |
Shares Outstanding | ||
Title of Class | January 6, 2012 | |
Common Stock | 8,391,244 |
Item 1. | Financial Statements. |
November 30, 2011 | May 31, 2011 | |||||||
(Unaudited) | ||||||||
ASSETS |
||||||||
Current Assets: |
||||||||
Cash |
$ | 8,056 | $ | 9,727 | ||||
U.S. Treasury Bills, at cost plus accrued interest |
30,995 | 34,994 | ||||||
Accounts receivable |
7,944 | 11,477 | ||||||
Inventories |
10,034 | 8,720 | ||||||
Other current assets |
3,103 | 3,463 | ||||||
Total Current Assets |
60,132 | 68,381 | ||||||
Property, Plant and Equipment, at Cost: |
||||||||
Land |
4,063 | 4,063 | ||||||
Buildings and improvements |
45,845 | 45,760 | ||||||
Machinery and equipment |
23,460 | 23,300 | ||||||
73,368 | 73,123 | |||||||
Less accumulated depreciation |
53,815 | 52,998 | ||||||
19,553 | 20,125 | |||||||
Idle property, net of accumulated depreciation |
2,970 | 4,677 | ||||||
Net Property, Plant and Equipment |
22,523 | 24,802 | ||||||
Other Assets |
5,993 | 5,916 | ||||||
Total Assets |
$ | 88,648 | $ | 99,099 | ||||
1
Item 1. | Financial Statements (Continued). |
November 30, 2011 | May 31, 2011 | |||||||
(Unaudited) | ||||||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current Liabilities: |
||||||||
Accounts payable, trade |
$ | 2,664 | $ | 3,392 | ||||
Accrued salaries and wages |
3,021 | 3,089 | ||||||
Accrued marketing programs |
3,222 | 1,573 | ||||||
Accrued warranty and related expenses |
3,609 | 3,366 | ||||||
Accrued workers compensation |
1,509 | 822 | ||||||
Other accrued liabilities |
1,926 | 2,474 | ||||||
Total Current Liabilities |
15,951 | 14,716 | ||||||
Other Deferred Liabilities |
7,436 | 7,344 | ||||||
Commitments and Contingencies See Note 6 |
||||||||
Shareholders Equity: |
||||||||
Common
stock, $.0277 par value, 15,000,000 shares authorized; issued 11,217,144 shares |
312 | 312 | ||||||
Additional paid-in capital |
4,928 | 4,928 | ||||||
Retained earnings |
125,765 | 137,543 | ||||||
Treasury stock, at cost, 2,825,900 shares |
(65,744 | ) | (65,744 | ) | ||||
Total Shareholders Equity |
65,261 | 77,039 | ||||||
Total Liabilities and Shareholders Equity |
$ | 88,648 | $ | 99,099 | ||||
The accompanying notes are an integral part of the consolidated financial statements. |
2
Item 1. | Financial Statements (Continued). |
Three-Months Ended | Six-Months Ended | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||
OPERATIONS |
||||||||||||||||
Net sales |
$ | 45,296 | $ | 36,621 | $ | 95,580 | $ | 82,448 | ||||||||
Cost of sales |
44,031 | 37,244 | 93,271 | 81,324 | ||||||||||||
Gross profit (loss) |
1,265 | (623 | ) | 2,309 | 1,124 | |||||||||||
Selling and
administrative expenses |
7,191 | 7,151 | 15,087 | 14,981 | ||||||||||||
Gain on sale
of idle property, plant and equipment |
2,500 | | 2,500 | | ||||||||||||
Operating loss |
(3,426 | ) | (7,774 | ) | (10,278 | ) | (13,857 | ) | ||||||||
Interest income |
4 | 18 | 11 | 36 | ||||||||||||
Loss before income taxes |
(3,422 | ) | (7,756 | ) | (10,267 | ) | (13,821 | ) | ||||||||
Benefit from income taxes |
| | | | ||||||||||||
Net loss |
$ | (3,422 | ) | $ | (7,756 | ) | $ | (10,267 | ) | $ | (13,821 | ) | ||||
Basic loss per share |
$ | (.40 | ) | $ | (.93 | ) | $ | (1.22 | ) | $ | (1.65 | ) | ||||
Cash dividends per share |
$ | .09 | $ | .18 | $ | .18 | $ | .36 | ||||||||
Weighted
average number of common shares outstanding |
8,391,244 | 8,391,244 | 8,391,244 | 8,391,244 | ||||||||||||
RETAINED EARNINGS |
||||||||||||||||
Balance at beginning of period |
$ | 129,943 | $ | 162,636 | $ | 137,543 | $ | 170,211 | ||||||||
Net loss |
(3,422 | ) | (7,756 | ) | (10,267 | ) | (13,821 | ) | ||||||||
Cash dividends paid |
(756 | ) | (1,511 | ) | (1,511 | ) | (3,021 | ) | ||||||||
Balance at end of period |
$ | 125,765 | $ | 153,369 | $ | 125,765 | $ | 153,369 | ||||||||
3
Item 1. | Financial Statements (Continued). |
2011 | 2010 | |||||||
(Unaudited) | ||||||||
CASH FLOWS FROM OPERATING ACTIVITIES: |
||||||||
Net loss |
$ | (10,267 | ) | $ | (13,821 | ) | ||
Adjustments to reconcile net loss to net cash used in
operating activities: |
||||||||
Depreciation |
1,203 | 1,357 | ||||||
Gain on sale of idle property, plant and equipment |
(2,500 | ) | | |||||
Change in assets and liabilities: |
||||||||
Accrued interest receivable |
5 | (1 | ) | |||||
Accounts receivable |
3,533 | 3,648 | ||||||
Inventories |
(1,314 | ) | (166 | ) | ||||
Other current assets |
360 | 1,346 | ||||||
Accounts payable, trade |
(728 | ) | (1,183 | ) | ||||
Accrued liabilities |
1,963 | 1,239 | ||||||
Other, net |
31 | (17 | ) | |||||
Net cash used in operating activities |
(7,714 | ) | (7,598 | ) | ||||
CASH FLOWS FROM INVESTING ACTIVITIES: |
||||||||
Proceeds
from principal payments of U.S. Treasury Bills |
34,985 | 129,966 | ||||||
Purchase of U.S. Treasury Bills |
(30,991 | ) | (116,967 | ) | ||||
Proceeds from sale of idle property, plant and
equipment |
4,071 | | ||||||
Purchase of property, plant and equipment |
(466 | ) | (306 | ) | ||||
Other, net |
(45 | ) | (73 | ) | ||||
Net cash provided by investing activities |
7,554 | 12,620 | ||||||
CASH FLOWS FROM FINANCING ACTIVITIES: |
||||||||
Cash dividends paid |
(1,511 | ) | (3,021 | ) | ||||
Net cash used in financing activities |
(1,511 | ) | (3,021 | ) | ||||
Net (decrease) increase in cash |
(1,671 | ) | 2,001 | |||||
Cash at beginning of period |
9,727 | 9,268 | ||||||
Cash at end of period |
$ | 8,056 | $ | 11,269 | ||||
4
Item 1. | Financial Statements (Continued). |
5
Item 1. | Financial Statements (Continued). |
Gross Amortized | Gross Unrealized | |||||||||||
Costs | Gains | Fair Value | ||||||||||
(Dollars in thousands) | ||||||||||||
November 30, 2011 |
||||||||||||
U. S. Treasury Bills |
$ | 30,995 | $ | 6 | $ | 31,001 | ||||||
May 31, 2011 |
||||||||||||
U. S. Treasury Bills |
$ | 34,994 | $ | 11 | $ | 35.005 | ||||||
6
Item 1. | Financial Statements (Continued). |
November 30, 2011 | May 31, 2011 | |||||||
(Dollars in thousands) | ||||||||
Raw materials |
$ | 4,752 | $ | 5,016 | ||||
Work in process |
2,414 | 3,300 | ||||||
Finished goods |
2,868 | 404 | ||||||
$ | 10,034 | $ | 8,720 | |||||
Six-Months Ended | ||||||||
November 30, | ||||||||
2011 | 2010 | |||||||
(Dollars in thousands) | ||||||||
Balance at the beginning of the period |
$ | 4,966 | $ | 4,839 | ||||
Accruals for warranties |
2,936 | 2,608 | ||||||
Settlements made during the period |
(2,693 | ) | (2,603 | ) | ||||
Balance at the end of the period |
5,209 | 4,844 | ||||||
Non-current balance included in other deferred
liabilities |
1,600 | 1,500 | ||||||
Accrued warranty and related expenses |
$ | 3,609 | $ | 3,344 | ||||
7
Item 1. | Financial Statements (Continued). |
Three-Months Ended | Six-Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Number of units repurchased |
| | | | ||||||||||||
Obligations from units repurchased |
$ | | $ | | $ | | $ | | ||||||||
Net losses on repurchased units |
$ | | $ | | $ | | $ | |
8
Item 1. | Financial Statements (Continued). |
Three-Months Ended | Six-Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Housing |
||||||||||||||||
Manufactured Housing |
||||||||||||||||
Domestic |
55 | % | 59 | % | 51 | % | 57 | % | ||||||||
Canadian |
| | | 1 | ||||||||||||
55 | 59 | 51 | 58 | |||||||||||||
Modular Housing |
||||||||||||||||
Domestic |
10 | 7 | 9 | 8 | ||||||||||||
Canadian |
6 | 1 | 4 | 1 | ||||||||||||
16 | 8 | 13 | 9 | |||||||||||||
Total Housing |
71 | 67 | 64 | 67 | ||||||||||||
Recreational Vehicles |
||||||||||||||||
Domestic |
25 | 25 | 29 | 25 | ||||||||||||
Canadian |
4 | 8 | 7 | 8 | ||||||||||||
Total Recreational Vehicles |
29 | 33 | 36 | 33 | ||||||||||||
100 | % | 100 | % | 100 | % | 100 | % | |||||||||
9
Item 1. | Financial Statements (Continued). |
Three-Months Ended | Six-Months Ended | |||||||||||||||
November 30, | November 30, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
(Dollars in thousands) | (Dollars in thousands) | |||||||||||||||
NET SALES |
||||||||||||||||
Housing |
||||||||||||||||
Manufactured Housing |
||||||||||||||||
Domestic |
$ | 25,117 | $ | 21,427 | $ | 48,793 | $ | 47,100 | ||||||||
Canadian |
| 96 | | 582 | ||||||||||||
25,117 | 21,523 | 48,793 | 47,682 | |||||||||||||
Modular Housing |
||||||||||||||||
Domestic |
4,541 | 2,656 | 8,754 | 6,533 | ||||||||||||
Canadian |
2,502 | 378 | 3,756 | 971 | ||||||||||||
7,043 | 3,034 | 12,510 | 7,504 | |||||||||||||
Total Housing |
32,160 | 24,557 | 61,303 | 55,186 | ||||||||||||
Recreational Vehicles |
||||||||||||||||
Domestic |
11,437 | 9,129 | 27,599 | 20,430 | ||||||||||||
Canadian |
1,699 | 2,935 | 6,678 | 6,832 | ||||||||||||
Total Recreational Vehicles |
13,136 | 12,064 | 34,277 | 27,262 | ||||||||||||
Total Net Sales |
$ | 45,296 | $ | 36,621 | $ | 95,580 | $ | 82,448 | ||||||||
LOSS BEFORE INCOME TAXES |
||||||||||||||||
Operating Loss |
||||||||||||||||
Housing |
$ | (3,400 | ) | $ | (5,118 | ) | $ | (7,806 | ) | $ | (8,946 | ) | ||||
Recreational vehicles |
(1,865 | ) | (2,092 | ) | (3,740 | ) | (3,725 | ) | ||||||||
General corporate expense |
(661 | ) | (564 | ) | (1,232 | ) | (1,186 | ) | ||||||||
Gain on sale
of idle property, plant and equipment |
2,500 | | 2,500 | | ||||||||||||
Total operating loss |
(3,426 | ) | (7,774 | ) | (10,278 | ) | (13,857 | ) | ||||||||
Interest income |
4 | 18 | 11 | 36 | ||||||||||||
Loss before income taxes |
$ | (3,422 | ) | $ | (7,756 | ) | $ | (10,267 | ) | $ | (13,821 | ) | ||||
10
Item 1. | Financial Statements (Continued). |
11
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations. |
12
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
| Total net sales were $45,296,000, an approximate 24 percent increase from the $36,621,000 reported in the same period a year ago. | ||
| Housing net sales were $32,160,000, an approximate 31 percent increase from the $24,557,000 realized in the second quarter of fiscal 2011. | ||
| Recreational vehicle net sales were $13,136,000 in the second quarter of fiscal 2012, an approximate 9 percent increase from $12,064,000 in the second quarter of fiscal 2011. | ||
| The Corporation sold idle housing facilities located in Ocala, Florida and Ephrata, Pennsylvania. The gain on the sale of the facilities was $1,114,000 and $1,386,000, respectively. | ||
| Net loss for the second quarter of fiscal 2012 was $3,422,000 as compared to $7,756,000 for the second quarter of fiscal 2011. On a per share basis, net loss was $.40 as compared to $.93 for the same period a year ago. | ||
| The Corporation continues to maintain a full valuation allowance for deferred tax assets, and as a result recognized no benefit from income taxes from its current period loss. | ||
| The Corporation commenced recreational vehicle production at its Bristol, Indiana facility. The amount of capital expenditures and expenses incurred to convert this facility from housing to recreational vehicle production was approximately $300,000. |
13
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
| The Corporation closed its housing facility in Fair Haven, Vermont due to weak demand in the New England market. Independent dealers and communities that purchased homes from the Fair Haven facility will have their product and service needs met by the Corporations facility in Leola, Pennsylvania. | ||
| A dividend of $.09 per share was paid. Subsequent to November 30, 2011, the Board of Directors approved a resolution to suspend dividend payments on the outstanding shares of the Corporations common stock until further notice. The suspension was for cash preservation purposes. The Board will evaluate financial performance and liquidity needs in determining the timing and amount of future dividend payments. |
14
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | November 30, | Increase | ||||||||||||||||||
2011 | Percent | 2010 | Percent | (Decrease) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net Sales |
||||||||||||||||||||
Housing |
||||||||||||||||||||
Manufactured Housing |
||||||||||||||||||||
Domestic |
$ | 25,117 | 55 | % | $ | 21,427 | 59 | % | $ | 3,690 | ||||||||||
Canadian |
| | 96 | | (96 | ) | ||||||||||||||
25,117 | 55 | 21,523 | 59 | 3,594 | ||||||||||||||||
Modular Housing |
||||||||||||||||||||
Domestic |
4,541 | 10 | 2,656 | 7 | $ | 1,885 | ||||||||||||||
Canadian |
2,502 | 6 | 378 | 1 | 2,124 | |||||||||||||||
7,043 | 16 | 3,034 | 8 | 4,009 | ||||||||||||||||
Total Housing |
32,160 | 71 | 24,557 | 67 | 7,603 | |||||||||||||||
Recreational Vehicles |
||||||||||||||||||||
Domestic |
11,437 | 25 | 9,129 | 25 | 2,308 | |||||||||||||||
Canadian |
1,699 | 4 | 2,935 | 8 | (1,236 | ) | ||||||||||||||
Total Recreational Vehicles |
13,136 | 29 | 12,064 | 33 | 1,072 | |||||||||||||||
Total Net Sales |
$ | 45,296 | 100 | % | $ | 36,621 | 100 | % | $ | 8,675 | ||||||||||
Unit shipments |
||||||||||||||||||||
Housing |
||||||||||||||||||||
Manufactured Housing |
||||||||||||||||||||
Domestic |
566 | 36 | % | 507 | 34 | % | 59 | |||||||||||||
Canadian |
| | 4 | | (4 | ) | ||||||||||||||
566 | 36 | 511 | 34 | 55 | ||||||||||||||||
Modular Housing |
||||||||||||||||||||
Domestic |
83 | 5 | 51 | 4 | 32 | |||||||||||||||
Canadian |
47 | 3 | 7 | | 40 | |||||||||||||||
130 | 8 | 58 | 4 | 72 | ||||||||||||||||
Total Housing |
696 | 44 | 569 | 38 | 127 | |||||||||||||||
Recreational Vehicles |
||||||||||||||||||||
Domestic |
799 | 50 | 691 | 46 | 108 | |||||||||||||||
Canadian |
95 | 6 | 245 | 16 | (150 | ) | ||||||||||||||
Total Recreational Vehicles |
894 | 56 | 936 | 62 | (42 | ) | ||||||||||||||
Total Unit Shipments |
1,590 | 100 | % | 1,505 | 100 | % | 85 | |||||||||||||
15
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
| Domestic manufactured housing net sales increasing approximately 17 percent | ||
| Canadian manufactured housing net sales decreasing 100 percent | ||
| Domestic modular housing net sales increasing approximately 71 percent | ||
| Canadian modular housing net sales increasing approximately sixfold. |
| Domestic manufactured housing shipments increasing approximately 12 percent | ||
| Canadian manufactured housing shipments decreasing 100 percent | ||
| Domestic modular housing shipments increasing approximately 63 percent | ||
| Canadian modular housing shipments increasing approximately sixfold. |
| Domestic recreational vehicle net sales increasing approximately 25 percent | ||
| Canadian recreational vehicle net sales decreasing approximately 42 percent. |
| Domestic recreational vehicle shipments increasing approximately 16 percent | ||
| Canadian recreational vehicle shipments decreasing 61 percent. |
16
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | Percent | November 30, | Percent | |||||||||||||||||
2011 | of Sales* | 2010 | of Sales* | Increase | ||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||
Housing |
$ | 31,246 | 97 | $ | 25,099 | 102 | $ | 6,147 | ||||||||||||
Recreational vehicles |
12,785 | 97 | 12,145 | 101 | 640 | |||||||||||||||
Consolidated |
$ | 44,031 | 97 | $ | 37,244 | 102 | $ | 6,787 | ||||||||||||
* | The percentages for housing and recreational vehicles are based on segment net sales. The percentage for consolidated cost of sales is based on total net sales. |
17
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | Percent | November 30, | Percent | |||||||||||||||||
2011 | of Sales | 2010 | of Sales | Increase | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Selling and
administrative
expenses |
$ | 7,191 | 16 | $ | 7,151 | 20 | $ | 40 |
November 30, | Percent | November 30, | Percent | |||||||||||||
2011 | of Sales* | 2010 | of Sales* | |||||||||||||
(Dollars in thousands) | ||||||||||||||||
Housing |
$ | (3,400 | ) | (11 | ) | $ | (5,118 | ) | (21 | ) | ||||||
Recreational vehicles |
(1,865 | ) | (14 | ) | (2,092 | ) | (17 | ) | ||||||||
General corporate expenses |
(661 | ) | (1 | ) | (564 | ) | (2 | ) | ||||||||
Gain on sale
of idle property, plant and equipment |
2,500 | 6 | | | ||||||||||||
Total Operating loss |
$ | (3,426 | ) | (8 | ) | $ | (7,774 | ) | (21 | ) | ||||||
* | The percentages for housing and recreational vehicles are based on segment net sales. The percentage for general corporate expenses, gain on sale of idle property and equipment and total operating loss are based on total net sales. |
18
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | November 30, | Increase | ||||||||||||||||||
2011 | Percent | 2010 | Percent | (Decrease) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Net Sales |
||||||||||||||||||||
Housing |
||||||||||||||||||||
Manufactured Housing |
||||||||||||||||||||
Domestic |
$ | 48,793 | 51 | % | $ | 47,100 | 57 | % | $ | 1,693 | ||||||||||
Canadian |
| | 582 | 1 | (582 | ) | ||||||||||||||
48,793 | 51 | 47,682 | 58 | 1,111 | ||||||||||||||||
Modular Housing |
||||||||||||||||||||
Domestic |
8,754 | 9 | 6,533 | 8 | $ | 2,221 | ||||||||||||||
Canadian |
3,756 | 4 | 971 | 1 | 2,785 | |||||||||||||||
12,510 | 13 | 7,504 | 9 | 5,006 | ||||||||||||||||
Total Housing |
61,303 | 64 | 55,186 | 67 | 6,117 | |||||||||||||||
Recreational Vehicles |
||||||||||||||||||||
Domestic |
27,599 | 29 | 20,430 | 25 | 7,169 | |||||||||||||||
Canadian |
6,678 | 7 | 6,832 | 8 | (154 | ) | ||||||||||||||
Total Recreational Vehicles |
34,277 | 36 | 27,262 | 33 | 7,015 | |||||||||||||||
Total Net Sales |
$ | 95,580 | 100 | % | $ | 82,448 | 100 | % | $ | 13,132 | ||||||||||
Unit shipments |
||||||||||||||||||||
Housing |
||||||||||||||||||||
Manufactured Housing |
||||||||||||||||||||
Domestic |
1,085 | 29 | % | 1,103 | 34 | % | (18 | ) | ||||||||||||
Canadian |
| | 23 | 1 | (23 | ) | ||||||||||||||
1,085 | 29 | 1,126 | 35 | (41 | ) | |||||||||||||||
Modular Housing |
||||||||||||||||||||
Domestic |
155 | 4 | 121 | 3 | 34 | |||||||||||||||
Canadian |
69 | 2 | 18 | 1 | 51 | |||||||||||||||
224 | 6 | 139 | 4 | 85 | ||||||||||||||||
Total Housing |
1,309 | 35 | 1,265 | 39 | 44 | |||||||||||||||
Recreational Vehicles |
||||||||||||||||||||
Domestic |
1,972 | 54 | 1,489 | 46 | 483 | |||||||||||||||
Canadian |
407 | 11 | 489 | 15 | (82 | ) | ||||||||||||||
Total Recreational Vehicles |
2,379 | 65 | 1,978 | 61 | 401 | |||||||||||||||
Total Unit Shipments |
3,688 | 100 | % | 3,243 | 100 | % | 445 | |||||||||||||
19
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
| Domestic manufactured housing net sales increasing approximately 4 percent | ||
| Canadian manufactured housing net sales decreasing 100 percent | ||
| Domestic modular housing net sales increasing approximately 34 percent | ||
| Canadian modular housing net sales increasing approximately threefold. |
| Domestic manufactured housing shipments decreasing approximately 2 percent | ||
| Canadian manufactured housing shipments decreasing 100 percent | ||
| Domestic modular shipments increasing approximately 28 percent | ||
| Canadian modular shipments increasing approximately threefold. |
| Domestic recreational vehicle net sales increasing approximately 35 percent | ||
| Canadian recreational vehicle net sales decreasing approximately 2 percent. |
| Domestic recreational vehicle shipments increasing approximately 32 percent | ||
| Canadian recreational vehicle shipments decreasing 17 percent. |
20
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | Percent | November 30, | Percent | |||||||||||||||||
2011 | of Sales* | 2010 | of Sales* | Increase | ||||||||||||||||
(Dollars in Thousands) | ||||||||||||||||||||
Housing |
$ | 60,354 | 98 | $ | 54,591 | 99 | $ | 5,763 | ||||||||||||
Recreational vehicles |
32,917 | 96 | 26,733 | 98 | 6,184 | |||||||||||||||
Consolidated |
$ | 93,271 | 98 | $ | 81,324 | 99 | $ | 11,947 | ||||||||||||
* | The percentages for housing and recreational vehicles are based on segment net sales. The percentage for consolidated cost of sales is based on total net sales. |
21
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | Percent | November 30, | Percent | |||||||||||||||||
2011 | of Sales | 2010 | of Sales | Increase | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||
Selling and
administrative expenses |
$ | 15,087 | 16 | $ | 14,981 | 18 | $ | 106 |
November 30, | Percent | November 30, | Percent | |||||||||||||
2011 | of Sales* | 2010 | of Sales* | |||||||||||||
(Dollars in Thousands) | ||||||||||||||||
Housing |
$ | (7,806 | ) | (13 | ) | $ | (8,946 | ) | (16 | ) | ||||||
Recreational vehicles |
(3,740 | ) | (11 | ) | (3,725 | ) | (14 | ) | ||||||||
General corporate expenses |
(1,232 | ) | (1 | ) | (1,186 | ) | (1 | ) | ||||||||
Gain on sale of idle
property, plant and equipment |
2,500 | 3 | | | ||||||||||||
Total Operating loss |
$ | (10,278 | ) | (11 | ) | $ | (13,857 | ) | (17 | ) | ||||||
* | The percentages for housing and recreational vehicles are based on segment net sales. The percentage for general corporate expenses, gain on sale of property, plant and equipment and total operating loss are based on total net sales. |
22
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
November 30, | May 31, | Increase | ||||||||||
2011 | 2011 | (Decrease) | ||||||||||
(Dollars in thousands) | ||||||||||||
Cash and U.S. Treasury Bills |
$ | 39,051 | $ | 44,721 | $ | (5,670 | ) | |||||
Current assets, exclusive of cash and U. S. |
||||||||||||
Treasury Bills |
$ | 21,081 | $ | 23,660 | $ | (2,579 | ) | |||||
Current liabilities |
$ | 15,951 | $ | 14,716 | $ | 1,235 | ||||||
Working capital |
$ | 44,181 | $ | 53,665 | $ | (9,484 | ) |
23
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations (Continued). |
| Consumer confidence and economic uncertainty | ||
| Availability of wholesale and retail financing | ||
| The health of the U.S. housing market | ||
| Cyclical nature of the manufactured housing and recreational vehicle industries | ||
| General or seasonal weather conditions affecting sales | ||
| Potential impact of natural disasters on sales and raw material costs | ||
| Potential periodic inventory adjustments by independent retailers | ||
| Interest rate levels | ||
| Impact of inflation | ||
| Impact of rising fuel costs | ||
| Cost of labor and raw materials | ||
| Competitive pressures on pricing and promotional costs | ||
| Catastrophic events impacting insurance costs | ||
| The availability of insurance coverage for various risks to the Corporation | ||
| Market demographics | ||
| Managements ability to attract and retain executive officers and key personnel |
24
Item 3. | Quantitative and Qualitative Disclosures About Market Risk. |
Item 4. | Controls and Procedures. |
Item 1. | Legal Proceedings. |
Item 1A. | Risk Factors. |
25
Item 6. | Exhibits. |
(31.1) | Certification of Chief Executive Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002-Rule 13a-14(a)/15d-14(a) |
|||
(31.2) | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act
of 2002-Rule 13a-14(a)/15d-14(a) |
|||
(32) | Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C.
Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|||
(101.INS) | XBRL Instance Document. |
|||
(101.SCH) | XBRL Taxonomy Extension Schema Document. |
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(101.CAL) | XBRL Taxonomy Extension Calculation Linkbase Document. |
|||
(101.LAB) | XBRL Taxonomy Extension Label Linkbase Document. |
|||
(101.PRE) | XBRL Taxonomy Extension Presentation Linkbase Document. |
SKYLINE CORPORATION |
||||
DATE: January 6, 2012 | /s/ Jon S. Pilarski | |||
Jon S. Pilarski | ||||
Chief Financial Officer | ||||
DATE: January 6, 2012 | /s/ Martin R. Fransted | |||
Martin R. Fransted | ||||
Corporate Controller |
26
Exhibit Number | Descriptions | |||
31.1 | Certification of Chief Executive Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002-Rule 13a-14(a)/15d-14(a) |
|||
31.2 | Certification of Chief Financial Officer Pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002-Rule 13a-14(a)/15d-14(a) |
|||
32 | Certification of Chief Executive Officer and Chief Financial Pursuant to 18 U.S.C.
Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|||
101.INS | XBRL Instance Document. |
|||
101.SCH | XBRL Taxonomy Extension Schema Document. |
|||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. |
|||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. |
|||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
27
1. | I have reviewed this quarterly report on Form 10-Q of Skyline Corporation (the registrant); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared; | ||
b) | Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
/s/ Thomas G. Deranek | ||||
Thomas G. Deranek | ||||
Chief Executive Officer |
1. | I have reviewed this quarterly report on Form 10-Q of Skyline Corporation (the registrant); |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared; | ||
b) | Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
c) | Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
d) | Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
5. | The registrants other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of registrants board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | ||
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
/s/ Jon S. Pilarski | ||||
Jon S. Pilarski | ||||
Chief Financial Officer |
1. | The periodic report containing financial statements to which this certificate is an exhibit fully complies with the requirements of Section 13(a) or 15 (d) of the Securities Exchange Act of 1934. | ||
2. | The information contained in the periodic report to which this certificate is an exhibit fairly presents, in all material respects, the financial condition and results of operations of the Corporation. |
DATE: January 6, 2012 | /s/ Thomas G. Deranek | |||
Thomas G. Deranek | ||||
Chief Executive Officer | ||||
DATE: January 6, 2012 | /s/ Jon S. Pilarski | |||
Jon S. Pilarski | ||||
Chief Financial Officer | ||||
Warranty
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6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Nov. 30, 2011
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Warranty and Commitments and Contingencies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Warranty |
NOTE 4 Warranty
A reconciliation of accrued warranty and related expenses is as follows:
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'0O:F%V87-C