Interest in the RV lifestyle remains strong, resulting in a 32% increase in quarterly profits for Winnebago Industries despite backlogs for the Eden Prairie-based company's recreational vehicles and boats caused by supply-chain issues and inflationary pressures.
The company has gained market share, now controlling 14.3% of the RV retail market as of January.
"The healthy demand environment, and the unique strength of our brands, positioned Winnebago Industries well to take continued pricing actions to offset component and material cost inflation and continue to deliver strong margin performance across our segments," said Mike Happe, Winnebago's president and chief executive, in a news release.
Still, Winnebago shares lost 12% of their value on Wednesday, closing at $55.05, a 52-week low.
The company earned $91.2 million, or $2.75 a share, in its second quarter ended Feb. 26. Sales increased 39% to $1.2 billion, the third consecutive quarter of sales over $1 billion.
Earnings adjusted for the $320 million July acquisition of the Barletta pontoon boat business, amortization and other factors, were $3.14 a share, up 42% from the same period a year ago and above analyst expectations of $2.94 a share.
The strong demand, paired with operational leverage and price actions during the quarter, helped to keep the gross profit margin at 18.6%, level with the same quarter last year.
The war in Ukraine is causing further supply-chain disruption, likely meaning more inflationary pressure for the rest of the year. The result will likely be more price increases to protect profit margins, as well as cost containment measures, the company said.
