Recreational Vehicle Maker Thor's European Sales Hit By Dip, Cautions On Macro Outlook
Thor Industries, Inc. (NYSE:THO) shares are trading higher on Wednesday after the company reported third-quarter EPS of $2.53 beating the street consensus of $1.83.
Quarterly sales of $2.89 billion, up 3.3% year over year (Y/Y), outpaced the analyst consensus estimate of $2.48 billion.
Gross profit margin in the quarter under review expanded by 20 basis points year over year to 15.3%.
Adjusted EBITDA increased 7.9% Y/Y to $254.8 million in the quarter.
North American Towable Recreational Vehicle (RV) net sales increased 9.1% Y/Y, while North American Motorized RV net sales rose 3.1% Y/Y in the quarter.
North American Towable RV net sales benefitted from 5.5% higher unit shipments and a 3.6% increase in net price per unit.
Gross profit margin improved 200 basis points to 14.9%, attributed to higher sales, less discounting, better warranty costs, and ongoing savings.
North American Motorized RV net sales increased due to a 10.9% rise in unit shipments (partly from promotions), though a 7.8% decrease in net price per unit (due to product mix shift and higher discounting) partially offset this.
Gross profit margin fell to 10.5% from 11.1%, primarily owing to increased sales discounting.
As of April 30, the order backlog for North American Towable RV stood at $634.3 million (-14.4%) and North American Motorized RV came in at $883.7 million (-4.5%).
European RV net sales decreased 5.1% Y/Y for the quarter, led by a 12.2% decrease in unit shipments, which was offset in part by a 7.1% Y/Y increase in the overall net price per unit.
European RV net sales fell due to a 12.2% drop in unit shipments, partially offset by a 7.1% increase in net price per unit. The price increase included a 6.8% rise from product mix and pricing changes, plus a 0.3% benefit from foreign currency exchange rates.
European RV gross profit margin contracted 130 basis points to 16.2% on increased sales discounting.
As of April 30, the order backlog for European RV came in at $1.34 billion (-30.6%).
The company exited the quarter with cash and cash equivalents worth $508.3 million, with net inventories worth $1.35 billion. Long-term debt (net) at the end of the quarter stood at $1.01 billion.
Todd Woelfer, senior VP and COO, said, ”As we anticipated and messaged at the beginning of our fiscal year, our North American Motorized and European segments have both seen year-over-year declines in gross margin but still achieved resilient results considering the challenging environments facing those segments.”
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