Exhibit 99.1
FOR MORE INFORMATION CONTACT:
Mike Duncan
Investor Relations
Monaco Coach Corporation
(541) 686-8011
MONACO COACH CORPORATION REPORTS FIRST QUARTER 2003 PROFITS
COBURG, Oregon, April 23, 2003 — Monaco Coach Corporation (NYSE:MNC) today reported revenue and earnings for its first quarter ended March 29, 2003. First quarter earnings per share were 15 cents on revenue of $273.6 million. Gross profit for the first quarter was $33.6 million. Operating income for the first quarter was $8.0 million, and net income for the first quarter was $4.3 million. First quarter unit sales of Monaco Coach Corporation products totaled 2,367 units. First quarter motorhome sales totaled 1,698 units, and first quarter towable recreational vehicles totaled 669 units.
“Our market is starting to show signs of improvement,” stated Kay L. Toolson, Monaco Coach Corporation Chairman and Chief Executive Officer. “As of today, our internal tracking indicates that our motorized retail sales are up more than 10% year-to-date over the same period last year. Our retail dealer partners are beginning to experience heavier lot traffic, strengthening their outlook and optimism. We remain excited about our company’s long-term future, as exceptional demographic trends and changing attitudes toward leisure travel should continue to fuel our industry.”
Monaco Coach Corporation President John Nepute commented, “We continue to focus on reducing our finished goods inventory between now and the end of the second quarter – an important part of our overall debt reduction strategy. The improvement in retail demand should help us reach this goal as retail dealers replenish units sold from their inventory. Although we’re encouraged by the strengthening retail market, we expect second quarter sales similar to the first quarter.”
According to Monaco Coach Corporation Vice President and Chief Financial Officer Marty Daley, “Reduced production rates, combined with effective retail and wholesale incentive programs, are also helping us work down inventory levels. However, these activities pressured
our gross margins and increased our sales expenses. First quarter gross margins were 12.3% and sales, general and administrative expenses were 9.4% of sales. We expect similar gross margin and sales expense levels in the second quarter.”
Headquartered in Coburg, Oregon, with additional manufacturing facilities in Indiana, Monaco Coach Corporation is one of the nation’s leading manufacturers of recreational vehicles. The company offers customers luxury recreational vehicle models under the Monaco, Holiday Rambler, Safari, Beaver, McKenzie and Royale Coach brand names.
The statements above regarding expected improvement in the retail market for the Company’s products, the Company’s second quarter revenue expectations, the Company’s ability to reduce finished goods inventory and debt levels, and the Company’s expectations for second quarter gross margins and sales, general and administrative expenses are forward-looking statements. 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 other factors. Please refer to the Company’s SEC reports, including but not limited to the annual report on Form 10-K for 2002, and the 2002 Annual Report to Shareholders for additional factors.
2
MONACO COACH CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited: dollars in thousands, except share and per share data)
|
|
|
December
28, |
|
March 29, |
|
||
|
ASSETS |
|
|
|
|
|
||
|
Current assets: |
|
|
|
|
|
||
|
Trade receivables, net |
|
$ |
116,647 |
|
$ |
98,826 |
|
|
Inventories |
|
175,609 |
|
199,901 |
|
||
|
Resort lot inventory |
|
26,883 |
|
24,277 |
|
||
|
Prepaid expenses |
|
3,612 |
|
2,818 |
|
||
|
Deferred income taxes |
|
33,379 |
|
34,965 |
|
||
|
Total current assets |
|
356,130 |
|
360,787 |
|
||
|
|
|
|
|
|
|
||
|
Property, plant and equipment, net |
|
135,350 |
|
140,909 |
|
||
|
Debt issuance
costs, net of accumulated amortization of $388, |
|
683 |
|
611 |
|
||
|
Goodwill, net |
|
55,254 |
|
55,254 |
|
||
|
|
|
|
|
|
|
||
|
Total assets |
|
$ |
547,417 |
|
$ |
557,561 |
|
|
|
|
|
|
|
|
||
|
LIABILITIES |
|
|
|
|
|
||
|
Current liabilities: |
|
|
|
|
|
||
|
Book overdraft |
|
$ |
3,518 |
|
$ |
18,216 |
|
|
Line of credit |
|
51,413 |
|
35,700 |
|
||
|
Current portion of long-term note payable |
|
21,667 |
|
21,667 |
|
||
|
Accounts payable |
|
78,055 |
|
87,916 |
|
||
|
Product liability reserve |
|
21,322 |
|
22,413 |
|
||
|
Product warranty reserve |
|
31,745 |
|
30,674 |
|
||
|
Income taxes payable |
|
4,536 |
|
7,128 |
|
||
|
Accrued expenses and other liabilities |
|
29,633 |
|
26,969 |
|
||
|
Total current liabilities |
|
241,889 |
|
250,683 |
|
||
|
|
|
|
|
|
|
||
|
Long-term note payable |
|
30,333 |
|
26,000 |
|
||
|
Deferred income taxes |
|
14,568 |
|
15,145 |
|
||
|
Total liabilities |
|
286,790 |
|
291,828 |
|
||
|
|
|
|
|
|
|
||
|
STOCKHOLDERS’ EQUITY |
|
|
|
|
|
||
|
Common stock,
$.01 par value; 50,000,000 shares |
|
289 |
|
290 |
|
||
|
Additional paid-in capital |
|
51,501 |
|
52,280 |
|
||
|
Retained earnings |
|
208,837 |
|
213,163 |
|
||
|
Total stockholders’ equity |
|
260,627 |
|
265,733 |
|
||
|
Total liabilities and stockholders’ equity |
|
$ |
547,417 |
|
$ |
557,561 |
|
3
MONACO COACH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited: dollars in thousands, except share and per share data)
|
|
|
Quarter Ended |
|
||||
|
|
|
March 30, |
|
March 29, |
|
||
|
|
|
|
|
|
|
||
|
Net sales |
|
$ |
293,600 |
|
$ |
273,574 |
|
|
Cost of sales |
|
255,855 |
|
239,968 |
|
||
|
Gross profit |
|
37,745 |
|
33,606 |
|
||
|
|
|
|
|
|
|
||
|
Selling, general and administrative expenses |
|
21,166 |
|
25,649 |
|
||
|
|
|
|
|
|
|
||
|
Operating income |
|
16,579 |
|
7,957 |
|
||
|
|
|
|
|
|
|
||
|
Other income, net |
|
41 |
|
206 |
|
||
|
Interest expense |
|
(698 |
) |
(1,012 |
) |
||
|
Income before income taxes |
|
15,922 |
|
7,151 |
|
||
|
|
|
|
|
|
|
||
|
Provision for income taxes |
|
6,249 |
|
2,825 |
|
||
|
|
|
|
|
|
|
||
|
Net income |
|
$ |
9,673 |
|
$ |
4,326 |
|
|
|
|
|
|
|
|
||
|
Earnings per common share: |
|
|
|
|
|
||
|
Basic |
|
$ |
.34 |
|
$ |
.15 |
|
|
Diluted |
|
$ |
.33 |
|
$ |
.15 |
|
|
|
|
|
|
|
|
||
|
Weighted average common shares outstanding: |
|
|
|
|
|
||
|
Basic |
|
28,712,998 |
|
28,956,906 |
|
||
|
Diluted |
|
29,624,722 |
|
29,340,788 |
|
||
|
|
|
|
|
|
|
||
|
Units Sold: |
|
2,692 |
|
2,367 |
|
||
4
MONACO COACH CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited: dollars in thousands)
|
|
|
Quarter Ended |
|
||||
|
|
|
March 30, |
|
March 29, |
|
||
|
|
|
|
|
|
|
||
|
Increase (Decrease) in Cash: |
|
|
|
|
|
||
|
|
|
|
|
|
|
||
|
Cash flows from operating activities: |
|
|
|
|
|
||
|
Net income |
|
$ |
9,673 |
|
$ |
4,326 |
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
||
|
Loss on sale of assets |
|
0 |
|
16 |
|
||
|
Depreciation and amortization |
|
1,340 |
|
2,262 |
|
||
|
Deferred income taxes |
|
4,628 |
|
(1,010 |
) |
||
|
Changes in working capital accounts: |
|
|
|
|
|
||
|
Trade receivables, net |
|
(18,334 |
) |
17,821 |
|
||
|
Inventories |
|
(7,812 |
) |
(24,292 |
) |
||
|
Resort lot inventory |
|
0 |
|
2,607 |
|
||
|
Prepaid expenses |
|
(2,860 |
) |
792 |
|
||
|
Accounts payable |
|
24,510 |
|
9,861 |
|
||
|
Product liability reserve |
|
0 |
|
1,091 |
|
||
|
Product warranty reserve |
|
0 |
|
(1,071 |
) |
||
|
Income taxes payable |
|
545 |
|
2,592 |
|
||
|
Accrued expenses and other liabilities |
|
2,232 |
|
(2,664 |
) |
||
|
Net cash provided by operating activities |
|
13,922 |
|
12,331 |
|
||
|
Cash flows from investing activities: |
|
|
|
|
|
||
|
Additions to property, plant and equipment |
|
(3,768 |
) |
(8,439 |
) |
||
|
Proceeds from sale of assets |
|
0 |
|
687 |
|
||
|
Net cash used in investing activities |
|
(3,768 |
) |
(7,752 |
) |
||
|
Cash flows from financing activities: |
|
|
|
|
|
||
|
Book overdraft |
|
6,645 |
|
14,698 |
|
||
|
Borrowings (payments) on lines of credit, net |
|
(15,000 |
) |
(15,713 |
) |
||
|
(Payments) on long-term note |
|
(2,500 |
) |
(4,333 |
) |
||
|
Debt issuance costs |
|
0 |
|
(11 |
) |
||
|
Issuance of common stock |
|
701 |
|
780 |
|
||
|
Net cash used by financing activities |
|
(10,154 |
) |
(4,579 |
) |
||
|
Net change in cash |
|
0 |
|
0 |
|
||
|
Cash at beginning of period |
|
0 |
|
0 |
|
||
|
Cash at end of period |
|
$ |
0 |
|
$ |
0 |
|
5