MNC Monaco Coach Cp

Monaco Coach Corporation Reports First Quarter 2005 Profits COBURG, Ore., April 27 /PRNewswire-FirstCall/ -- Monaco Coach Corporation (NYSE:MNC) today reported revenues and earnings for its first quarter ended April 2, 2005. (Logo: http://www.newscom.com/cgi-bin/prnh/19991018/MONACO) First quarter earnings per share were 18 cents, compared to earnings of 40 cents for the first quarter of 2004. Revenues for the first quarter were $331.5 million compared to revenues of $355.0 million for the first quarter of 2004. Net income for the first quarter was $5.3 million compared to $11.9 million for the first quarter of 2004. First quarter 2005 motorhome sales totaled 1,798 units and first quarter towable sales totaled 1,227 units for a combined total of 3,025. "Discounting during the first quarter allowed us to retain shelf space at our dealers' lots, but it chipped away at our first quarter gross profit margin," said Monaco Coach Corporation President John Nepute. "We introduced incentives earlier this year to help prevent a build-up of finished goods inventory and to support our dealer partners in retailing their inventory, and we are seeing positive results from these efforts. We do expect to see some level of discounting as we move into the 2006 model year. Being proactive in reducing run rates and making production cuts during the first quarter enabled us to manage dealer and Company inventories and to attain the level of profitability that we accomplished." "Shifting our product mix to yield a higher percentage of towables during the first quarter generated an increase in our direct material costs as a percentage of sales, however, this was more than offset by savings in labor costs," said Monaco Coach Vice President and Chief Financial Officer Marty Daley. "And while the reduced production and run rates contributed to our overall profitability during the first quarter, the corresponding reduction in plant efficiencies affected coverage of our indirect costs on a per unit basis." The Company reported minor improvements in several expense areas during the quarter which helped compensate for increased settlement costs and resulted in a slight reduction in selling, general and administrative expenses in the first quarter of 2005, compared to the fourth quarter of 2004. "Looking toward the second quarter, we expect that revenue will be in the $340 million to $350 million range. Improvements in the level of discounting and additional savings in certain direct and indirect costs should lead to second quarter gross margins between 11.3% and 11.5%. Sales, general, and administrative expenses for the second quarter are expected to be in the 8.0% to 8.2% range," said Daley. "Additionally, as we have previously announced, there will be one-time pre-tax charges of approximately $3.5 million in the second quarter related to the closure of the Bend manufacturing plant." "The market conditions that have been affecting the industry over the past few quarters impacted our financial results in the first quarter," stated Monaco Coach Corporation Chairman and Chief Executive Officer Kay Toolson. "Nonetheless, we are very positive about the strong acceptance of our 2005 product line by our dealer network and our retail customers. We believe that our 2005 product line-up has been one of the strongest in our company's history. As we move into the 2006 model year, we will continue to focus on delivering the industry's most innovative products, seek to further improve quality, find ways to lower our costs, and continue to provide the best after-market service support in the industry." Monaco Coach Corporation will conduct a conference call in conjunction with this news release at 2:00 p.m. ET today, Wednesday, April 27, 2005. Members of the news media, investors, and the general public are invited to access a live broadcast of the conference call via the Investor Relations page of the Company's website at http://www.monaco-online.com/. The event will be archived and available for replay for the next 90 days. Headquartered in Coburg, Oregon, with additional manufacturing facilities in Eastern Oregon and Indiana, Monaco Coach Corporation employs more than 5,900 people and is one of the nation's leading manufacturers of recreational vehicles. The Company offers entry-level priced towable RVs up to custom made luxury recreational vehicle models under the Monaco, Holiday Rambler, Safari, Beaver, McKenzie and Royale Coach brand names. For additional information about Monaco Coach Corporation please visit http://www.monaco-online.com/. The statements above regarding discounting, revenue, gross margin and sales, general, and administrative expenses, guidance for the second quarter of 2005, are forward-looking statements based on current information and expectations and involve a number of risks and uncertainties. A number of factors could cause actual results to differ materially from these statements, including slower than anticipated sales of new and existing products, a general slowdown in the economy, new product introductions by competitors, or the loss of dealers or deterioration in the relationships with dealers. Please refer to the Company's SEC reports, including but not limited to the most recent Form 10-Q, the annual report on Form 10-K for 2004, and the 2004 Annual Report to Shareholders for additional factors. These filings can be accessed over the Internet at http:%5Chttp://www.sec.gov/ and on the company website. MONACO COACH CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited: dollars in thousands, except share and per share data) April 2, January 1, 2005 2005 (unaudited) ASSETS Current assets: Cash $0 $1,477 Trade receivables, net 127,380 138,770 Inventories 169,777 169,018 Resort lot inventory 7,315 8,228 Prepaid expenses 5,190 4,937 Deferred income taxes 33,188 33,350 Total current assets 342,850 355,780 Property, plant, and equipment, net 141,563 140,112 Debt issuance costs, net of accumulated amortization of $572 and $616, respectively 571 537 Goodwill 55,254 55,254 Total assets $540,238 $551,683 LIABILITIES Current liabilities: Book overdraft $1,587 $0 Line of credit 34,062 25,000 Accounts payable 79,072 96,095 Product liability reserve 20,233 20,053 Product warranty reserve 32,369 32,159 Income taxes payable 2,087 3,984 Accrued expenses and other liabilities 31,533 30,891 Total current liabilities 200,943 208,182 Deferred income taxes 19,679 19,713 Total liabilities 220,622 227,895 STOCKHOLDERS' EQUITY Common stock, $.01 par value; 50,000,000 shares authorized, 29,425,787 and 29,488,513 issued and outstanding, respectively 294 295 Additional paid-in capital 57,454 58,071 Retained earnings 261,868 265,422 Total stockholders' equity 319,616 323,788 Total liabilities and stockholders' equity $540,238 $551,683 MONACO COACH CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited: dollars in thousands, except share and per share data) Quarter Ended April 3, April 2, 2004 2005 Net sales $354,976 $331,512 Cost of sales 310,493 295,295 Gross profit 44,483 36,217 Selling, general, and administrative expenses 24,800 27,343 Operating income 19,683 8,874 Other income, net 86 114 Interest expense (405) (485) Income before income taxes 19,364 8,503 Provision for income taxes 7,441 3,180 Net income $11,923 $5,323 Earnings per common share: Basic $ .41 $ .18 Diluted $ .40 $ .18 Weighted average common shares outstanding: Basic 29,296,193 29,460,137 Diluted 29,967,452 29,893,889 Units sold: 3,136 3,025 MONACO COACH CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited: dollars in thousands) Quarter Ended April 3, April 2, 2004 2005 Increase (Decrease) in Cash: Cash flows from operating activities: Net income $11,923 $5,323 Adjustments to reconcile net income to net cash provided (used) by operating activities: Loss (Gain) on sale of assets 78 (1) Depreciation and amortization 2,536 2,537 Deferred income taxes 459 (128) Changes in working capital accounts: Trade receivables, net (25,447) (11,390) Inventories (18,805) 759 Resort lot inventory 3,360 139 Prepaid expenses (3,547) 228 Accounts payable 39,075 17,023 Product liability reserve (1,120) (180) Product warranty reserve 1,068 (210) Income taxes payable 2,967 1,897 Accrued expenses and other liabilities 3,556 (642) Net cash provided by operating activities 16,103 15,355 Cash flows from investing activities: Additions to property, plant, and equipment (2,553) (2,119) Proceeds from sale of assets 145 52 Net cash used in investing activities (2,408) (2,067) Cash flows from financing activities: Book overdraft 0 (1,587) Payments on lines of credit, net 0 (9,062) Payments on long-term notes payable (3,750) 0 Debt issuance costs 129 (11) Dividends paid (1,465) (1,769) Issuance of common stock 769 618 Net cash used by financing activities (4,317) (11,811) Net change in cash 9,378 1,477 Cash at beginning of period 13,398 0 Cash at end of period $22,776 $1,477 FOR MORE INFORMATION CONTACT: Craig Wanichek - Investor Relations Monaco Coach Corporation (541) 681-8011 http://www.monaco-online.com/ http://www.newscom.com/cgi-bin/prnh/19991018/MONACO http://photoarchive.ap.org/ DATASOURCE: Monaco Coach Corporation CONTACT: Craig Wanichek, Investor Relations, of Monaco Coach Corporation, +1-541-681-8011 Web site: http://www.monaco-online.com/ Company News On-Call: http://www.prnewswire.com/comp/123493.html

Copyright