Winnebago posts $8.6M loss on falling sales

Winnebago Industries WGO, the nation's biggest motor-home manufacturer, posted a loss of $8.6 million in its fiscal third quarter as revenue continued to crumble in the face of falling motor-home sales.

The Forest City, Iowa-based company reported a per-share loss of 29 cents per share for the quarter ended May 30. It earned $3 million, or 10 cents per share, last year.

Revenue plunged 64% to $50.8 million, as motor-home shipments fell 62% during the quarter.

Wall Street analysts surveyed by Reuters predicted a loss of 27 cents per share, on average.

Chief Executive Robert Olson said lack of access to credit "remains the biggest hurdle" for the industry. Motor-home sales, which are closely tied to consumer confidence, have been falling for more than a year as the recession drives consumers away from showrooms.

Yet Winnebago said it held up better than the competition during the quarter. During the first two months of its fiscal third quarter, industry wide motor-home sales fell a steeper 77%, the company said.

It also said it has managed to cut dealer inventory by 50% from a year ago and its sales backlog has climbed 14% since the end of the last quarter.

"We continue to believe we are in a strong financial position with sufficient cash, no long-term debt and the benefit of a respected brand name," Olson said in a statement.

Winnebago has been cutting costs to cope with the downturn. Last week, the company announced the closure of a fiberglass factory in Hampton, Iowa, resulting in the loss of 40 jobs. The announcement came just months after it announced pay cuts across its salaried work force.

Several of Winnebago's competitors, including Monaco Coach MCOAQ and Fleetwood Enterprises FLTWQ, have sought bankruptcy protection and sold off assets in recent months.

Shares of Winnebago closed Wednesday at $6.48. The stock has more than doubled from a 52-week low of $3.14 in March, but is off from a high of $15.20 last year.

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